Published on January 15, 2025 3:40 AM GMT
Until recently Ithought Julia and I were digging a bit into savings todonate more. With the tighter funding climate for effective altruismwe thoughtit was worth spending down a bit, especially considering that ourexpenses should decrease significantly in 1.5y when our youngeststarts kindergarten.
I was surprised, then, when I ran thenumbers and realized that despite donating 50% of a reducedincome, we were $9k (0.5%) [1] richer than when I leftGoogle two years earlier.
This is a good problem to have! After thinking it over for the lastmonth, however, I've decided to start earningless: I've asked for a voluntary salary reduction of $15k/y(10%). [2] This is something I've been thinking about off and on sinceI started working at a non-profit: it's much more efficientto reduce your salary than it is to make a donation. Additionally,since I'm askingothers to fund our work I like the idea of putting my money (orwhat would be my money if I weren't passing it up) where my mouth is.
Despite doing this myself, voluntary salary reduction isn't somethingthat I'd like to see become a norm:
I think it's really valuable for people to have a choice aboutwhere to apply their money to making the world better.
The organization where you have a comparative advantage inapplying your skills will often not be the one that can do the mostwith additional funds, even after considering the tax advantages.
I especially don't think this is a good fit for junioremployees and people without a lot of savings, where I'm concernedsocial pressure to take a reduction could keep people from makingprudent financial decisions.
Still, I think this is a good choice for me, and I feel good aboutefficiently putting my money towards a better world.
[1] In current dollars. If you don't adjust for inflation it's $132kmore, but that's not meaningful.
[2] I'm not counting this towards my 50% goal, just likeI'm not counting the pay cut I took when I stopped earning to give.
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