Saving : A necessary evil

Mauritius is presently living an economic paradox. Everything seems to point out (at last!) to an economic recovery: The country is progressively leaving the grey list of the Financial Action Task Force on Money Laundering (FATF); the reopening of our boundaries brings a flow of tourists into our hotels, and investors for the many building programmes.

A paradox, indeed; because we might have thought that this long-awaited recovery would immediately bring about an easier and cheaper daily life, in the form of decreased prices; but we are compelled to acknowledge that life seems to have become more expensive. A rupee kept at a very low rate, the increase of shipping costs, the worldwide demand for energy, a weak production, or the climatic conditions, which have brought about the low production of some agricultural raw materials (for instance, wheat), may explain this situation.

A paradox, also, because we might have expected a decrease in the consumption by the families; but it seems that the official statistics point out rather to an increase. The consumption by the families in 2020 was Rs315 billion, revealing a decrease of 63 billion as compared with 2019. But the first two quarters of 2021 reveal that we have consumed Rs14 billion more than during the first two quarters of 2020.

A paradox, also, because the reported recovery is still low, and particularly fragile, as it depends of factors which are beyond human control. The return of other pandemic waves, more aggressive and more contaminating variants, a worldwide economic slowdown brought about by scandals in the new dominating Chinese economy, rumours of war in the Chinese Sea, financial scandals weakening our financial basis, are only a few of the serious possibilities. Anyhow, we, Seventh-day Adventist Christians, do not believe in a world which will become better, but we rather expect a final upheaval, announcing Christ’s second coming. At last, I dare to hope that we shall not forget our heavenly home while working for this Earth, which we all wish to see in a better condition.

Yet, these paradoxes demand that we should foresee. To foresee means to take precautionary measures, advanced measures. But I suggest particularly this definition: to make the necessary preparations. A convincing example from the Bible is Joseph, when he proposed to Pharaoh to take measures to store of food, after his dream of the fat and lean cows. The Bible, particularly the Book of Proverbs, mentions also the necessity of preparing in advance: Proverbs 6.6–8: Go to the ant, you sluggard; consider its ways and be wise! It has no commander, no overseer or ruler, Yet it stores its provisions in summer and gathers its food at harvest.

The same Bible teaches it also in Matthew 6.19: Do not store up for yourselves treasures on earth, where moth and rust destroy, and where thieves break in and steal. Should we therefore foresee? Do we need to make the necessary preparations? Several Bible verses hint that wisdom fosters a good management of the resources placed at our disposal, particularly Proverbs 21.20: In the house of the wise are stores of choice foods and oil, but a foolish man devours all he has. The Bible also teaches that we must assume our responsibilities as members of a family; else, we would be “worse than an unbeliever”: 1 Timothy 5.8: If anyone does not provide for his relatives, and especially for his immediate family, he has denied the faith and is worse than an unbeliever.

Such is not the topic of this communication; but we may reconcile these opposing ideals if we understand that we must prepare what is necessary, in the hope that God will bless us beyond what we need for our own welfare, the welfare of His cause, and the welfare of the others; but particularly, that we should not love the earthly goods more than those which are eternal: 1 John 2.15–17: Do not love the world or anything in the world. If anyone loves the world, the love of the Father is not in him. For everything in the world— the cravings of sinful man, the lust of his eyes and the boasting of what he has and does—comes not from the Father but from the world. The world and its desires pass away, but the man who does the will of God lives forever.

So, in these advantageous times of bonuses for performances, of the PRB report, of the 13th month bonus, I challenge all of you to save, and make the necessary preparations. Several schools of thought and several methods exist and are of equivalent value; but I shall limit myself to what is well-known and simple to implement immediately.

Prepare a budget

Preparing a budget is the basis of everything. It demands discipline and organization. The model proposed by the Stewardship Department (available at the FEAM offices) is totally adapted. Step 1 – Make a balance of all your mandatory payments/expenses Step 2 – Rationalize by imposing on yourself the proportions not to be overstepped as compared with the model Step 3 – Respect what has been decided

Keep an emergency fund

A beach vendor I met recently explained to me that the last 18 months were difficult, but that the reserves accumulated during the previous years had saved the situation. The above-mentioned paradoxes demand that we should keep an emergency fund. The estimations vary between 3, 6, or 12 months of survival fund in the case of a loss of income; but it would be wise to determine a minimum of three months of emergency fund. Step 1 – Add up your mandatory expenses for one month; for instance: food, rent, bills. Step 2 – Aim at saving twice the amount added up in Step 1. This fund should cover your monthly expenses during at least three months. Therefore, if the total of Step 1 is Rs25,000, your fund should contain at least Rs75,000.

Additional information. This money should be liquid and easily available, since it will be used to cover unexpected expenses. It is therefore recommended to keep it in a savings fund, instead of a long-range investment. It is always difficult to start an emergency fund when our means are limited; we therefore propose that you start with the surpluses which will be available at the end of this year.