You may feel like you don’t have much money, but the reality is, if you’re reading this, you’re probably rich.
So what should we know about money? What should we teach our kids?
It’s that time of year again, last night we started our first night of “Financial Peace University.” I remember when Dave Ramsey’s program was started at my former church, and we saw hundreds of people feed from the bondage of debt. When I came to my current position, I knew that FPU was something I wanted to see implemented here, and we’ve also seen hundreds of families liberated from the slavery of indebtedness. If you’ve never taken this class, you need to do it!
So what is is that we need to know about money? Here are four things (plus one bonus from me) that you need to not only know, but need to teach other people. The financial crisis that our country faces will not simply fix itself, it is going to take each of us getting our own financial houses in order, and helping our neighbors do the same:
- Work: This is where money comes from. I think many people today have the idea that “society” owes them a living, or that some how, simply by virtue of their being alive, someone deserves to have things like food, clothing, shelter, a car, cable TV, etc. When I think of the Bible’s attitude regarding work and pay, the first (famous) verse that I think of is “If anyone is not willing to work, let him not eat.” (2Thess 3:10). Work is the means by which God provides us with our needs, do you want more money? Work for it.
- Spend: Every person/family should have a budget. A budget is not a listing of where all your money went, it is a directive to tell your money where to go. You make it before you earn your money. Far too often we spend our money based on the amount we earn, as in “well, I make ‘X’ so I can buy…” If you spend all of your money every month, you will never have enough. If you are constantly spending all of what (or even more than) you have, you are making yourself a slave to your money. This is the point of the verse “You cannot serve God and money.” (Matt 6:24)
- Save: Jesus spoke of the foolishness of amassing great wealth simply to keep it all to yourself (cf. Luke 12:20) however, this is not an encouragement to not save your money. In fact, the Bible is very clear that it is your responsibility to plan for your future needs (household, medical, retirement, etc.) If you spend everything, and don’t save anything, you are not being a good steward of the abilities and resources that God has given you. “Go to the ant, O sluggard; consider her ways, and be wise. Without having any chief, officer, or ruler, she prepares her bread in summer and gathers her food in harvest. How long will you lie there, O sluggard? When will you arise from your sleep? A little sleep, a little slumber, a little folding of the hands to rest, and poverty will come upon you like a robber, and want like an armed man.” (Prov 6:6-11)
- Give: Why does God bless us with financial resources? God blesses us so that we can give. We cannot all give the same, but we are expected to give to the degree that we have been given to. Attitudes like “I earned this money” or “this is mine” have no place in a Believer’s vocabulary. If you are not giving, you are like the dead sea, always receiving and never releasing, stagnant and stale. “Every man shall give as he is able, according to the blessing of the LORD your God which He has given you.” (Deut 16:17)
BONUS: Don’t spend money you don’t have. This is my mantra on finances. It really comes down to this for living within your means. I have talked with many many many people in my office or at my house who are absolutely covered in debt and they can’t seem to see a way out. Then, when I try to help them, I find that they have satellite TV, smart phones, expensive electronics like flatscreen TVs, car payments, they frequent places like Starbucks, and eat almost every meal. These are the things that you must sell and stop before you ask someone (like your church family) to give you money for nothing.
Look, statistically speaking, more than 50% of people spend some time below the poverty line, so we all need help from time to time, and that is one of the functions of the church (cf. the “least of these my brothers” in Matt 25), but make sure you actually need the help before you ask for it.
My wife and I wanted to give to the building campaign at our church. We try to budget fairly tightly so in order to make a 3-year commitment, we canceled our Cable TV service and committed that money to our church. When Kennedy (our second daughter) came along, my wife wanted a minivan. We didn’t go and take a loan against money we hoped we’d make in the future, no, we sold our truck (that we bought used and owned outright) and found a used minivan that we could pay cash for. I also needed a car, so I found a car (used 2002 Hyundai Accent) that I could buy for $3,000. We have not been on a vacation, just my wife and I, since our first daughter, Reagan, was born in 2008. So, for my wife’s 35th birthday we are going on a cruise, a nice cruise, but we booked it almost a year in advance and I sold my motorcycle to cover the cost.
What you have to do is first wait, and then spend what you have. Do you want a specific car? Great, buy it when you have the money. If you will never have the money, then you should never have the car… This is why our country is in a mess. We have bought the lie of the credit industry that tells you to go ahead and get the thing you want on the hope that you will be able to pay for it later.
When you buy on (unsecured) credit, you are obligating yourself for the future… if you are a Christian, your life has already been bought, who are you to say “well, I have to work for 7 more years to pay for ‘X'” what if God wants you to sell everything and move overseas in 2-years? What if He wants you to give $1,000 to someone going on a mission trip? What if the Lord is calling you to give a special gift to your church? Not only have you already spent God’s money, you’ve enslaved yourself to MasterCard.
the borrower is the slave of the lender.
Obviously there are times when there are emergencies that you would not have been able to save for (like a medical emergency), and in rare occasions “promotional cards” (like for airline miles) can give you a slight advantage (but remember, the point of “promotional cards” is to make the credit card company more money, more money from you, the sucker), but please don’t use unsecured credit to buy things on a regular basis, this is what Prov 22 is talking about.
If you are going to buy a house, put at least 20% down. It is up to you to ensure that you are never “underwater.” People who paid more money than (a) they could afford and (b) the house was really worth, are not victims, they are poor managers of their resources. We should not deprive them of the valuable lesson that losing what they though was “their home” will teach them. You can even finance a car (though I don’t recommend it), but make sure you put enough cash down to ensure that the vehicle will always be more valuable on the open market than you owe, again, that is your responsibility. Never buy consumable resources (food, gas, clothing, etc…) on credit. If you have to, go hungry and naked for a month to save up the cash.
I’ll end with this word: responsibility. We each have to take responsibility for our own lives, and the lives of our own family, as well as those who are truly in need in our churches and communities (cf. 1Tim 5:8ff). No one else is responsible for you but you. God has given each of us what we need