The Amish are an incredible strong and united community. The Amish, in many ways, are an example to follow. However, there is one area about the Amish that people don’t talk about much. That is their approach to finances. Perhaps people don’t acknowledge it, because of their simple way of life. Or perhaps because it seems mysterious to the outside world. Or maybe because they don’t have “investments” in the traditional contemporary form. However, the Amish are a community that to a degree have vital financial principles figured out.
On this article, I wanted to explain 5 attractive secrets about Amish’s financial practices that I believe are helpful to build a solid financial IQ today. But before we get started you may ask, why the Amish? To which my reply will be: read on, and you will soon understand why!
The Amish live simply! And this of course does not mean just live below your means, but it means live fully and joyful!! People these days are miserable thinking how to spend money they don’t have, and how to get more stuff that they don’t need. The Amish are an exceptional community that can teach us a lot about living fully but simply. Amish simply avoid debt at all cost, and never use credit cards or credit. There is a simplicity to this. However, in the financial world, people believe this concept alone will solve more than half of your financial problems. Click To Tweet Items like debt, financial stress, the ‘keeping up with the Joneses effect’, and many more, can be mitigated and overcome.
They produce more than what they need. This is a strong principle that the Amish continues to impart into the newer generations. Although their economy is limited to agriculture and construction (for the most part) the Amish apply this principle to their simple economy well. They produce crops like corn, in excess to keep some, sell some, to invest on other items, and exchange some for other foods and goods. Even if agriculture is not what you do, you can still apply this Amish principle to your income. Yes, your income!! Produce more than what you need when it comes to your income and invest it wisely to continue to build wealth. Click To Tweet One way to produce more, is to maximize what you do for a living. For example, if you are a teacher, try to tutor part-time on the weekends, or pick up classes in the evening. The extra money produced use it to pay off debt and to invest, which leads to the next point.
For the Amish saving is a priority! They save as a priority not as a “leftover” concept. Statistics shows that most people in the US saved about 5% of their income. Amish save on average about 20%. They do so by prioritizing saving over spending. Even when their income sometimes is much less than most ‘Englishmen’ (the Amish term for people in the US that are not Amish), their saving habits are to be admirable. From never paying retail prices, to using and repairing what they have, to never wasting much, the Amish know how to save. Frugal living helps you save. Save out of priority, not out of what is left over after spending. Click To Tweet Some people call this principle: pay yourself first.
Most Amish own a business. They are farmers, construction business owners, hotel managers (a la B and B), retail stores owners, gourmet pastry chefs, and many others. Their lifestyle is marked by rejecting government handouts (although they do have some tax benefits and exceptions) and having a strong sense of communal commerce. They love to produce, sell and save. A fool-proof formula to become wealthy and to be joyful in the process. Start a business today! Some e-commerce business can be started with very little to no money. Figure out what your passion is, and put it to work. Click To Tweet
Share the most you can. In this current egocentric world, the Amish had taught us all how to share. They build houses for one another (especially for newlyweds) they share their food and goods they produced, they help families during illnesses and hard times, they take care of each other’s children, and much more. This tells you that sharing and giving is way more than just donating some money. Sharing is empathizing with others and helping at all cost. Amish faith of course has a lot to do with this core believe. But even if you don’t care about their faith, you can relate to the idea that helping others and sharing is essential for human wellness. Don’t wait to help! Donate money or time to a local charity. Get involved in your community at a school, church, or even a non-for-profit program (religious or not). This is going to bring a deep joy into your life and to those around you! Click To Tweet
Experts had summarized Amish’s financial IQ to 3 simple rules: Live simply, save and invest wisely, and share and help abundantly. All three core believes, are exactly in line with Saving For Hope’s action plan for future generations: budget, save/invest, and plan for the future to give. It is our Hope that these simple core believes helps you and your loved ones achieve financial freedom. In a world where more and more people are stressed out because of their finances, the Amish can teach us how to be free!
New to finances, but want to be stress free? Have kids and don’t know how to start teaching them better financial habits? Don’t worry, you are not alone. Take advantage of our free resources, and you can start your own journey HERE. Enjoy!