All Things Financial Planning Blog

A few days ago as I was driving along North Druid Hill Road I passed by a church.  On the marquee it read in big letters “Joseph the Dreamer.” I assumed that it was some indication of the sermon for the coming week. Ironically, this occurred on the anniversary of the Poor People’s March on Washington where Atlanta native Dr. Martin Luther King, Jr. delivered his famous “I Have a Dream” speech. Being the son of a preacher I felt that was too much coincidence for me not to spend a little time in my bible with Joseph the Dreamer.

In the Book of Genesis, we find that Pharaoh at the time was having dreams that he wanted interpreted. He found the dreams incredibly troubling and felt that they must have some sort of deeper meaning. In one dream there were seven fat and healthy cows that devoured by seven skinny sickly cows. The next dream followed the same pattern. Seven healthy full heads of grain were devoured by seven skinny heads of grain. Joseph explains to Pharaoh that he is having the same dream. The meaning of the dreams was that there would be seven good years of plenty followed by seven bad years of famine throughout Egypt. 

Here is where things get interesting for me. Joseph takes off his interpreter hat and puts on his financial planner hat. (Please allow for literary license here.) Joseph advises Pharaoh to take 20% of everything that is produced during the seven good years and set aside in storage so that there will be enough when the seven bad years come along. Does the concept sound familiar? Joseph could be the first financial planner in history.

Perhaps we don’t have to worry about the prospect of facing anything as severe as a seven-year famine but the admonition to save a little something extra while things are good is no less important. The last few years have shown the importance of savings. Old rules of thumb suggested three months of savings but the specter of being out of work for more than a year in many cases has caused many to re-think that rule of thumb. There are encouraging signs that our collective attitudes towards saving has changed. Based on recent data the savings rate has bounced back from a low of near zero in 2005 to more than 6% recently. 

It may not be possible for many of us to save 20% of our earnings but that doesn’t mean Joseph’s advice is outdated or old-fashioned. The most important thing is to start a program of saving. Making a good faith attempt at following Joseph’s advice could help keep your dreams from turning into a financial nightmare.

Lee Baker, CFP®
President
Apex Financial Services
Tucker, GA