How Much Net Worth I’ve Lost Being Generous (And Why I Wish It Was More)
I decided to go back and calculate how much net worth I’ve “lost” over the years by being charitable. This seems like a rather strange topic to explore, but honestly, I was just simply curious. I feel like a big part of the journey is being able to give back to others in need. That’s one of the reasons why I chose to start blogging. I hope our journey being documented for the world to see will inspire others to take control of their finances and make wiser decisions with their money.
So how much have I “lost”?
First things first: How did I come up with the numbers?
I took a pretty simple approach to estimating the total number. Here’s what I did.
- Pulled every charitable transaction for the last decade.
- Exported them into Excel.
- Calculated the time from the transaction date to today.
- Plugged in the calculated time into a future value function to calculate the estimated growth of each transaction, using a static 7% yearly growth number.
- Finally, added up all the numbers together.
That get us to the final number – $8,730.88
What would I have done differently?
My first reaction after seeing the final results were – that’s it? I honestly expected it to be more. Our donations have certainly been sporadic over the years, with the best months giving several hundreds dollars. But over 10 years, and adding the potential growth in, it was still under $10,000.
Part of me wishes our net worth was higher (and $8,730.88 more would be nice). I am, however, striving for financial freedom. I want to make the best choices for my family not based on a paycheck. The other part of me knows that this life is short, and there are people out there that need help more than we need a higher net worth. We can do more.
there are people out there that need help more than we need a higher net worth
Going forward, we’re going to look for how we can donate more. Right now, our automatic contributions only amount to $83 a month. I don’t want to look back at the end with millions saved and have done so little to help those around me.
The initial sum of every transaction before applying any growth was $6,790.33. This was from the year 2011 until today, October 25 2020.