One couple, one full-time job at the Department of Agriculture, a couple of other gigs running a janitorial business and a cake-making venture, plus the pastor position at New Jerusalem Missionary Baptist Church in Ferguson, Missouri.
That’s what it takes for Alonzo Adams and his wife, Ronica, to make ends meet, and that’s without any money left for retirement savings.
But they are raising their children in a neighborhood they like better, a few miles up the road in Florissant, Missouri. Their children, they have concluded, are a product of their environment. So what must the couple give up now to give their children a better future? “I give up the ability to have a better later,” Alonzo said.
Every one of us makes money trade-offs nearly every day, whether we realize it or not. Residence over retirement. Later over now. Needs over wants. Faith over financial facts.
But all too often these trade-offs are subconscious, which means we don’t discuss them openly and fail to question them relentlessly.
“It’s like money is just this big blob,” said Sallie Krawcheck, a co-founder and chief executive of Ellevest, an online investment service for women that tries to make these trade-offs visible. “People think about it conceptually and not in terms of wanting to start a business, retire well, buy a house or have a baby.”
The blob, she concluded when she was starting her business, needed clearing up. “This is not money to get more money,” she said. “It’s money to do these things. Help me figure out what I can afford and when and what the trade-offs are to getting there.”
The people you’ll encounter in this section have been sorting it out for themselves for some time now. Their household income is at or close to the median in their area.
Meeting the most basic of needs is usually not a problem, but it’s a challenge to figure out how often to allow themselves things they want and to weigh those desires against long-standing debt or the contributions they probably ought to make to their futures.
Below are some of the most common trade-offs that they — and all of us — face most often.
Today’s Experience Vs. Tomorrow’s First Home
In January 2010, Jordan Hightower’s younger sister, Molly, was killed in an earthquake while volunteering in Haiti. Jordan soon resolved that she would end her “one day” saving mentality and focus on today.
That meant travel, to a dozen bachelorette parties around the U.S. and to 23 countries around the world in the past seven years. While she’s traveled on a hostel budget and managed $4,000 in annual retirement savings, her down payment savings have suffered, even as prices for starter homes in Tacoma, Washington, have risen.
Jordan, 31, has no regrets, though. A wedding and kids are on the horizon in the next few years, and she plans to adjust her house savings accordingly now that she’s been able to see and do so much.
“I’m not worried or sad about changing those things,” she said.
Time With Family Vs. Time for Work
Martin and Raquel Vergara met as rivals, operating neighboring mall kiosks. She eventually became a personal banker, while he is a mixed martial arts fighter and a personal trainer.
Now that they’re the parents of two small children, Raquel, 26, has hit the pause button on her career to care for the kids. They don’t want to miss too much time with them, wondering if their hours with their children will add up to more than those of day-care providers.
“We are investing time in our kids,” said Martin, who is 25. “That means more than money.”
Even single parents make similar decisions if they possibly can, and some believe it’s necessary.
Natalie Davis was 31 and pregnant when her husband died unexpectedly five years ago. Now, she has a 10-year-old boy and a 4-year-old girl. She’s also no longer a full-time executive, even though she ran up some credit-card debt and sacrificed savings after her decision to work less.
For her, the choice wasn’t a close call. “They needed it,” she said, even though her husband did not have life insurance. Being with her children more often also helped clarify what counted as a mere want when it came to the family budget.
“Sometimes my son will really want something and I used to feel guilty, being that he doesn’t have his dad,” she said. “I used to do everything I could to get him what he wants, and now I don’t stress on that anymore.”
The Job You Love Vs. the One You Trained For
Chris and Tanya Brashers have faced health problems, landlord problems and employment problems. Both have declared personal bankruptcy. Soon, they will move from Bryan, Arkansas, to Fairhope, Alabama.
They are both veterans, and they are crossing their fingers that the optimistic new postal address will bring new career opportunities for Chris, who is 46. He trained as an engineer, but his passion is photography, and his research suggests that he will be able to get freelance work there.
While the couple is in debt, Tanya, who is 41, professes a certain serenity about their circumstances given all they have experienced. “I’ve learned not to depend on money for your happiness,” she said. “Now, living as simply as we do, I’m kind of at peace.”
Investments for Today Vs. Inheritance for Tomorrow
Alonzo, 46, the minister with multiple other jobs, works 65 to 70 hours each week so his children can grow up in a safe neighborhood. The family has a security system, but they sometimes forget to turn it on and then leave the doors unlocked.
Nobody comes in. “Would I be that comfortable in another neighborhood?” he said. “The neighborhood where I grew up in? Nope.”
So the family has physical security, paying now so that the kids can have a better later, as Alonzo puts it. But hanging over that trade-off is another one that he said so many African-American families face.
“What can I leave for them?” he wondered. “Most black people leave their families a bill when they die, not a legacy. Not an estate. We don’t have estates. The only thing we know about estates is when we see the sign for estate sales, and we get happy because this is a real big garage sale.”
All joking aside, Alonzo doesn’t need to look far to see where a lack of retirement savings can get you, given that his father is still a pastor at the church as well. Black preachers just die, he said. They don’t retire.
Still, at least his choice is deliberate: Trade a better later for himself for a better later for his children. It’s the same trade-off parents have made for centuries, and it’s a swap that many parents continue to make without much hesitation.