Does your culture support saving?
My brother told me once that, when he was in college, he handled money this way: "When I got paid, I set aside enough money for cigarettes, then spent the rest buying pizza and beer for everyone until the money ran out. The other people I hung around with did the same."
As I was researching my previous article (on a way to raise capital to start a business without banks or saving) one of the advantages mentioned was that it was an alternative to saving for people whose cultural or family values frowned on saving.
I started wondering if there were other cultural mechanisms to support accumulating capital for people whose culture frowned on saving, and that got me thinking about why a culture would frown on saving. That actually turns out to be pretty easy to explain: Saving only works when there are things to save, and there are plenty of circumstances where there isn't much to save.
Hunter-gatherers, for example, probably had very little that was worth saving. Trying to hoard meat or berries beyond what you could use immediately would just mean that they'd go to waste. Everyone would be better off if the general rule was to share any bounty--less went to waste, and fewer people would starve just because they had a string of bad luck. Making it a cultural value made everyone more secure, because you could count on others reciprocating.
Agriculture worked a change, of course. Suddenly there were both reasons to save, and the means: Grain could be stored, and you had to keep seed, or you couldn't plant next year. On top of that, a culture of sharing didn't help the community as much as it had for hunter-gatherers, because you and your neighbors all got your harvest at the same time. When things got tight, you couldn't expect anyone else to have stuff to share with you--their supplies would be running out at the exact same time as yours.
The fine points of these pressures for and against saving versus sharing would be different, depending on the kind of agriculture. Wheat can be stored for decades. Root vegetable for a season. Milk hardly at all. Live animals can live for a long time, but they need to be cared for right along--you can't just stick them in a granary--and once you slaughter them, they're gone whether you use the meat or not.
You'd expect, then, for different kinds of agriculture to lead to different kinds of cultural traditions about saving. The more your crops could just be saved (such as wheat or rice), the more the culture would tend to encourage families to be self-relient. The more your crops tended to be hard to preserve--and especially if they produced their bounty in irregular bursts, rather than all at once--the more the culture would tend to discourage saving in favor of sharing any surplus.
Fishing might be an example of the latter, and among the Native Americans of the Pacific Northwest coast (where fishing provided ample food), there were cultures that encouraged sharing to the point of making big ritualized productions out of it.
Other things besides agriculture might influence this. Feudal social structures often specify how the harvest is supposed to be divided up, but details matter. If any surplus tends to be seized by the lord, then there's not much advantage to saving over consuming, and no reason not to share any surplus with others. On the other hand, if there's a strong tradition of the peasants keeping their surplus, traditions of saving could begin to form.
My brother calls the way he managed money the "three musketeers model for financial management," since they did much the same thing. They not only provided for one another whenever any one of them had money, they would also treat all their friends when they were flush, and then mooch off them when things got tight. From chapter 8:
The hungry friends, followed by their lackeys, were seen haunting the quays and Guard rooms, picking up among their friends abroad all the dinners they could meet with; for according to the advice of Aramis, it was prudent to sow repasts right and left in prosperity, in order to reap a few in time of need.
Among Wise Bread readers, I would expect the "three musketeers model" to be generally considered improvident at best--irresponsible, reckless, and foolish all come to mind as well.
You'd think that the fact that American English even has a word for "improvident" told you where our cultural traditions come from, but we also have words like stingy, miserly, niggardly, and tightfisted, which shows considerable diversity of tradition. If your natural inclination is to be a saver, you can find endless support and role models, from the "millionaires next door" back to Benjamin Franklin. On the other hand, if your natural inclination is to spend money as fast as it comes in (or faster), you can find lots of only half-joking references to debt as "the American way."
Even where the culture strongly supports saving as a way to get ahead, there are still tensions when people try to put money aside, mostly from members of the household that would like to have a higher standard of living, but also from friends who feel threatened if one of the group takes steps to move ahead, and from neighbors who fear that property values will be threatened if someone doesn't spend as much as they do on conspicuous consumption.
I can think of a few other structures that provide the advantages of saving without running afoul of social prohibitions against saving, although none as clever as ROSCAs. Most of the ones I can think of really are "saving," just with a bit of a disguise. (I'd be interested to hear of others in the comments.)
Many kinds of insurance policies include a savings element, such as providing dividends or a lump sum to anyone who pays up the policy for its full lifetime. (Most such insurance policies are poor deals, by the way--one of the costs of lying to yourself and your family about what you're doing is that you can't get the best value for your dollar. But, if your family will let you buy insurance, but will insist on spending any money that you put in a savings account, then even an expensive insurance policy might be better than nothing.)
If lottery tickets were fair (as they are some places), they could serve this function--you buy a ticket every week, and then eventually get a lump sum when you win. Lotteries in the US are such a poor deal they don't provide an alternative to saving (although some people seem to treat them as if the did).
Anything you do to improve your land or your business--planting trees or buying tools--can serve the same function as saving. In fact, this is often a better investment than just putting money in the bank. (Which may explain why frowning on saving persists as a factor in many cultures.)
And, of course, sharing your bounty with your friends and your neighbors builds up a kind of good will that can bring some of the benefits of saving--food when you're hungry, for example--which brings us full circle.
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