I have recently made my first major donation to an EA cause. I have been very convinced by the EA argument for several years, but up until this point I have only made small donations, averaging maybe .5% of my income. This is despite me being older and wealthier than a lot of my EA peers, who have been making substantially higher donations in proportion to their income. It was a deliberate decision on my part to delay my serious giving, as I felt that the best way to maximize both my own utility and my contribution to the world was by giving more later in life, having first consolidated my own financial security. I would like to give a brief explanation of why I hold this view.

I see financial life essentially as a race. We are born and temporarily given a place to live (generally our parents house). We are dependent on others to provide for our daily needs and our education until we enter the workforce. Once we start working, we pay our own way, including for the cost of accommodation. We can then choose to save to purchase our own property, to avoid having to rent. Generally, once we have made such a purchase, we are only a couple of years away from considering starting a family. The cycle renews at this point but we are in a different role, now we are doing much of the supporting for our children. During this period our costs are much higher than they would be we did not have kids. You need to buy more food, require bigger living space, holidays are more expensive... the list goes on and on. Once the kids reach an age where they become financially independent, our costs of living drop substantially, this usually occurs somewhere between 5 and 10 years before our own retirement, at which point our income will also fall. 

From my experience and listening to those around me, it feels like the race is quite uneven depending on whether you are 'ahead' or 'behind' the pack. There are any number of analogies you can use here, but the point is that if you get ahead early, it can feel like you are riding the crest of a wave or out for any easy jog - but if you fall behind, it can feel like you are swimming against the current or running while breathing only the dust kicked up by those in front. If this is true, then giving a substantial part of you income (say 10% or more) in the early part of your life is not a good idea. It is counterproductive for both your own life and your total giving. 

If we make any kind of reasonable assumptions about renting, house price increases and mortgage repayments, it makes a lot of sense for people to save to purchase their own home as soon as possible. Once you own your home you are protected from future increases in house prices and rents. I also think it's a good idea to have a reasonable amount of savings to cover emergencies or large expected costs (such as college education or retirement). Once you have achieved these levels of wealth accumulation, you will be in a much better position to donate money. If you accept this argument, then it is counterproductive to make substantial donations to charities until you reach this level of financial security.

I have nothing but respect for the people whom I have spoken to within the EA community, who make serious lifestyle choices to allow themselves to donate large proportions of their incomes, but I'm suggesting that not only is there an easier way (by securing one's own financial situation first) but that this way will be more constructive in the long run. To be clear, this approach works regardless of your spending level relative to your income level. So if you want to only spend half of what you earn, and you are currently saving half of the surplus and giving half away, you would still be better off saving all of it, until you are financially secure and then increasing the proportion you give away substantially. 

There are risks to this approach - Lifestyle Drift is one, and Value Drift is another. Further, if we believe that there is a high discount rate to EA donations over time, as the best interventions steadily get fully funded then this is another factor. Nonetheless, I think this approach is worth more EAs considering - in particular giving away .5% per year (to stay in habit) and having a fixed target (say of home ownership, 6 months living expenses in savings, and well funded retirement plan) after which you plan to substantially increase donation to say 60% of discretionary income.

But there are also risks to the approach of giving substantially from an early age. I would also expect that doing so causes donor burnout, which may be one of the causes of Value Drift that was posted about recently. It's really hard to give away large sums of money (relative to income) when doing so requires sacrifice. This becomes increasingly true when you are faced with making financial decisions on the part of your children as well as yourself. Whereas, it's actively enjoyable to give away large sums when you have already covered all of your personal expenses and do not feel like donations are going to have a big impact on your spending choices. 

I tried to put together a numerical example for this post, but even with several simplifying assumptions, looking at the financial situation of a household over a 40 year time period becomes too complicated to easily explain in an article such as this. But if anyone wishes to discuss in more detail I would be happy to at least attempt to do so.