Today we’re going to talk about everyone’s favorite topic: finances! Before you leave, scoffing at my insolence to discuss such a taboo topic, just remember this:
“Jesus talked much about money. Sixteen of the thirty-eight parables were concerned with how to handle money and possessions. In the Gospels, an amazing one out of ten verses (288 in all) deal directly with the subject of money. The Bible offers 500 verses on prayer, less than 500 verses on faith, but more than 2,000 verses on money and possessions.” – from Preaching Today
I don’t plan to make 16 money posts for every 38 blogs I write, but I would be remiss to ignore the topic altogether. The reality is, our world does a terrible job teaching people about managing their finances. Did you know that in 2015, banks collected $11.16 billion in overdraft and non-sufficient fund fees? And the latest numbers indicate that 2016 increased that number by 4%.
It’s now 2017 – let’s see if we can do better.
God calls us to be good stewards, and that certainly includes the way we handle money. We often think that maintaining a budget will be an unpleasant burden, but the reality is, it actually provides much freedom. I’m not a financial planner, but these Biblical principles have gone a long way in helping our family manage money well.
1) Plan a budget and keep track of your spending
Luke 14:28-30 “For which of you, desiring to build a tower, does not first sit down and count the cost, whether he has enough to complete it? Otherwise, when he has laid a foundation and is not able to finish, all who see it begin to mock him, saying, ‘This man began to build and was not able to finish.’”
In the “olden” days, tracking your spending was a difficult task. You had to use a combination of spreadsheets or a ledger in your checkbook. Thanks to websites like Mint, however, planning and tracking your spending has never been easier. All of your expenses are automatically imported and categorized, saving you a large portion of the work. You might need to adjust some automatic categorizations, but a few minutes each week will do the job.
It’s an amazing tool and will help you realize that you’re spending $843 on eating out when you thought you were only spending about $300. It also creates nice looking graphs, which are wonderful for people like me who enjoy pretty pictures but feel that their head might explode upon reading an excel spreadsheet.
I also love Mint because it tracks all spending, whether credit or debit. There is a big green number for income, and a big red number for all spending. This is very motivational and a clear reminder to not let the red number get bigger than the green number.
Most consider this process to be too restrictive, but I’ve found it quite freeing. Instead of paying for something and then getting worried or stressed that I can’t afford it, I can check the app on my phone and say, “great, I have $50 left for eating out this month!” Alternatively, if there isn’t money left, I know that another month is around the corner and I can survive without Popeye’s chicken until then.
2) Avoid debt as often as you can
Proverbs 22:7b says, “the borrower is the slave of the lender.”
I’m not entirely against all forms of debt (mortgages you can afford, for instance), but for the most part, debt is a bad thing for the borrower, and should be avoided when possible. The reason for this, of course, is that it makes everything more expensive. According to Nerd Wallet, “The average household is paying a total of $6,658 in interest per year. This is 9% of the average household income ($75,591).” That means that the average household could have an extra $6,658
That means that the average household could have an extra $6,658 to spend each year. Imagine what you could do with that!
Dave Ramsey has a great blog post and video that explains how a car loan turns a $26,000 payment into a $33,000 car. Saving for the car and paying in cash, however, can earn you interest along the way, which means your car will actually cost less.
Credit Card debt can be particularly stressful and expensive. The US currently has $729 billion in credit card debt. With interest rates in the teens or twenties, that debt can be difficult to pay off. So if you aren’t in debt, be thankful and avoid it! If you already are in debt, then start paying it off. It might take months or years, but you can do it, and this will give you significantly more freedom than you believe is possible.
One popular way to pay off debt is the debt snowball method. Another is the debt avalanche method. Both methods are described in the Forbes video below, but whichever you choose, it will require discipline, extra work, and/or cutting your spending. Still, the reward is worth it!
3) Find Satisfaction in the Lord
Jeremiah 2:13 says, “For my people have committed two evils: they have forsaken me, the fountain of living waters, and hewed out cisterns for themselves, broken cisterns that can hold no water.“
Everyone is guilty of this. We constantly reject God, the only true source of satisfaction, and look for it in other places. A broken cistern can be anything – work, sex, alcohol, and of course, possessions.
The advertising industry spends countless dollars to convince you that their product will bring you happiness and satisfaction. Life will be better once you have your new car/iPhone/Red Rider BB Gun. When we believe this, we typically spend more money than we should and get ourselves into financial trouble. When you find your satisfaction in the Lord, those other things become superfluous and less of a temptation to purchase.
As Hebrews 13:5 says, “Keep your life free from love of money, and be content with what you have, for he has said, “I will never leave you nor forsake you.”
4) Give Generously
2 Corinthians 9:6-7: The point is this: whoever sows sparingly will also reap sparingly, and whoever sows bountifully will also reap bountifully. Each one must give as he has decided in his heart, not reluctantly or under compulsion, for God loves a cheerful giver.
One of the benefits of good financial management is that it frees up money for you to give, but giving can be tough. After all, you worked hard to earn that money! Giving, however, is vital to a healthy relationship with God and for taking care of your finances. First, giving is a very tangible reminder that God comes first in your life, which makes giving an act of worship. When you give, you make much of God, not just with your words, but also with your actions.
It also reminds us that God is our true provider – we may have worked for the money, but He provided us with the skills and abilities to do the job. When we keep this in mind, we’re able to better serve others who are in need as well.
Giving may be tough at first, cheerful givers are rarely natural. Once you start, however, you might be surprised at how satisfying it can be. When first things are put first, then the rest of life falls into place. When you give, your finances cannot control you, and that can change your life.
When most people think of worship, they think about singing praise songs. But God calls us to make everything an act of worship, and that certainly includes how we manage the resources He provides. By taking a Biblical approach to your finances and making God more important than money, you will enjoy more financial freedom and, indeed, you will worship.