The promised followup: What would I do?
My advice comes from a very different perspective than most on this site, and from the US in general (I know there are others on this site, but I can only speak to my own experience).
The situation We're basically trained to follow an every man for himself model. From elementary school up, we're taught that every person following their individual interest is The American Way and The Right Way. You can see the pervasiveness of this line of thinking in Drifterrider's comments, "Charity begins at home" and "never have to rely on the charity of others." He's not an outsider on the issue. This is the predominant line of thinking in our country, almost a virtue even.
The Alternative I posit that we're better off caring for and relying on one another. For me that start's with Jesus' teaching. But if you don't buy that, even economists and historians will both tell you that the aggregate is better off when everyone cooperates. Ex.: The fault's in early communist countries wasn't that everyone in the country wouldn't work to support one another. The problem was they said as a country they'd do make everything they needed themselves, and not trade with other countries. The countries floundered (starvation level) when they closed themselves off economically from the support of other nations. North Korea has continued to suffer as the holdout independent economy, and would be a failed state if not for accepting aid from China. We're better off setting up systems, and patterns where we rely on one another, rather than insisting on being self-sufficient.
Take my advice with that difference in mind. My primary perspective is not: what is the best life I can live given my resource status?. Instead my question is: what is the best set of live's lived across humanity given my resource status?. My advice won't make sense to the first question askers, just as FI principles don't make sense to the spendypants public.
Here's my adivce by phase.
While accumulating debt: give to charity.
While paying off debt: give to charity.
While saving for FI: give a lot to charity.
When FI: give all income above 'Stache maintenence to charity.
That's is my advice, and I practice what I preach.
While accumulating debt: In college, I lived off student loans. I took summer work to earn money to give.
While paying off debt: After college, I married into more student debt: $90k total. We slowed giving and hit this hard over 2 years and wiped it out.
While saving for FI / out of debt: give a lot to charity. We switched the total of out money from loan payments straight into charities. We surveyed groups, met with CEO's of charities, and commited to a couple. Last year our charitable giving was about 2x our spending. (That tax return though....) And we have no savings. At times, we only had $400 in our checking account.
When FI: We are and aren't FI. We don't have savings with passive income, but I or my wife will always individually be able to earn double our annual expenses.
Why Now that we've said it's best to consider how to benefit the whole of people, what does that whole of people look like. 3 Realities. 1. If you're reading this forum, you are incredibly wealthy. 2. Much of the world is incomprehensibly poor by relative and absolute standards. 3. I minor decrease in out consumption can fund a disproportinaely massive improvement in the lives of many of the world's poor.
The first thing to realize is that global incomes don't exist on the levels of percentage differences. They exist on the level of orders of magnitude differences.
We sort of get that. We talk on this forum of people like Buffet and Bogle, and other phenominal investers far wealthier than we can imagine. What we fail to see often though is that we are orders of magnitude wealthier than most human beings. If you earn $30k / yr. That puts you at the 96th percentile of income. You're better off than 96% of human beings and and only 3.8% of people stand between you and WARREN BUFFET in terms of income. At $80k per year, you're in the top 0.3%. I pick those levels because, they seem normal to us, but they're excessively large. That's MMM's entire point. We can live excessive, lavish, spendipants, comforable lives on $30k/yr.
We're not just a little wealthier though. Just like Buffet is way above us, the world is comparably below us. Now that we know $30k is high, everyone else is probably in the $20k-$25k range, right? Not even close. Let's not skip to poor. We'll start with average. Average is: $1375 / yr. Imagine what it would be like to life off of $1375 / year. Imagine what you couldn't afford. You're might be about right. You'd own a set or two of clothes, live in a basic house you built with your family from local raw materials, without common ammenities (no plumbing, maybe 1 electric cable, certainly no appliances, no car, a family bike is a luxury not a cost-saver). But you could buy basic food (rice with every meal) most days (unless someone gets sick and needs antibiotics that week), your kids could get probably an elementary school education or so. But you're doing well. Food, water, shelter, family: most likly covered. The essentials you can cover. That's how far from average we are, not a few grand here or there, we're 20x-50x better off than an average person.
Now let's consider what poverty looks like. Let's go with $550/yr. That still covers 20% of people or about 1.5 billion people (about 4 entire United States). Lots of people. What could you buy for $550/yr? Imagine being that mustacian? Not a good idea. At that point, you're a few tiers away from buying clothes or soap. At that point, you almost exclusively buy food. You work enough to get your kids a meal once a day, and yourself 5-7 meals a week. Things like sanitary water or antibitics aren't even one the radar. All this common level, things like mosquito bites and diarhea are leading causes of death. Clean water or basic antibiotics to the 20% are like that Tesla or a Mansion on a hill to us. Unaffordable luxeries that we never intend to own, but know are out there. Can these people improve their lives on their own though? Yes, if you live long enough, and make it through school, work hard, be responsible, you could get your family up from $500/yr. to that $1375/yr average. described above. Then you've made it. But that's about all your country has to offer. (No wonder the west is struggling with immigration).
In America, we don't really realize the world's income are scaled this way. The places are too far away. It's hard to really believe that places like Kazakhstan or Mali actually exist, but they do. And the living standard I discribed is not an anomaly there. It's the status quo. It's not a few unlucky people. It's almost everyone.
So now what You can say this sucks. Yes, it does. But it's also amazing how much good we can do. We like to fantasize about how much good we could do if we had Buffet level money. The thing is, to 50+% of the world's people you are crazy rich like buffet, and you can do crazy things to make lives better. Remember that family eating one meal a day? For $1.36/day you can double their entire families annual budget. Imagine that you can double a families entire budget simply by cutting your cable! That's doubling the number of meals those children get. For $10,000 you can build a well to provide sanitary water to 400 people for 20 years! That's $1.25 to provide non-poisonous water to a person for an entire year! My water bill is like $40 month. $1.25 / yr. is a crazy bargain. And it goes on acroos food, health, and water. When our income is 50-fold another families income, the impact of our giving is multiplied 50-fold. To these people, we are crazy rich, and a small donation on our part, will have a massive impact.
Why am I saying this I assume most of us don't know this. I'm not trying to argue. I'm trying to present reality to people perhaps for the first time, and let them have a chance to respond appropriately, to their knew knowlege. We're too sheltered. Do some research. Maybe, do some traveling, but not to the resorts. Learn what the world is like, then decide.
Each of us must decide We are super rich. Not enough to fix everything (at least not alone). So do we live our lives in luxury, and ignore the plight of others because we can never give enough. Or do we ask what's the least I need? And is it worth trading the extra so that 1000's of others can have food, water, and basic healthcare. Most people here will say no. I only hope I can recruit a few more to say yes. For me, the right answer is yes, to give what I can, because Jesus has given to me. I'm convinced that he'll one day reckognize all people based on what they've done for others and the poor. I know that doesn't work for everyone here, so I've tried to make a compelling case, on other items. But that's where I stand. I know, I'm on the losing side of a few arguments here, but I figured this is the right type of question to stake a case in this community.
If you want to talk more, send me a PM.
A couple charts are attached, and a good set of links below to explore.
https://www.gatesnotes.com/2017-Annual-Letterhttps://www.givingwhatwecan.org/get-involved/how-rich-am-i/?country=USA&income=50000&adults=1&children=0http://www.pewglobal.org/interactives/global-population-by-income/