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Yeah, hey what wait, isn’t it the other way around? As regular readers will know I have a manic obsession with turning things on their head and making fun of them (just ask our dog), but there is some truth to this.

Consider the regular idea of making small sacrifices now to get big differences later. Usually the concept of saving small monthly amounts and compounding the interest (a pf blogger favorite) is brought out as an example. However, the small changes may easily be lost in the noise of daily operations. One week of saving $2 a day are eliminated by an extra expenditure on Sunday because the money was there.

Conversely, current big sacrifices are very visible and can not be ignored. And later on they will still cause small ripples. For instance, today I bought another 50 shares of GE stock (I got it close to the 4 year low price) which over the next year will pay $62 in dividends and so and on so forth, hopefully. Not a lot compared to the bigger splash of around $1400, but every three months from now on there will be a small difference from the dividend pay out.

Originally posted 2008-06-20 07:08:05.