Economic Fear and Personal Responsibility

15 Oct

Dave RamseyAs I listen to the news I am struck by the lack of personal responsibility among everyone involved in this financial crisis. From the politicians who advocated the wrong positions years ago that encouraged the bad behavior of the banks and those who borrowed more money than they could repay. If you listen, everyone is blaming everybody else – without taking any blame themselves.

The politicians have a knack to vote in such a way that they can claim they were for something if it turns out good, or against something if it turns out bad. Of course, they are never responsible for any position they hold.

The banks are blaming everyone. The people they lent the money to aren’t paying the money back. The assets that support the loans are being devalued. Never mind that they lent money to people who shouldn’t even have qualified for the loans in the first place. They took the risk – now they don’t want to live with the results.

The people who borrowed more money than they can pay back. How may people borrowed money with adjustable rate mortgages that once adjusted couldn’t afford them anymore. They are blaming the banks for getting them into an adjustable rate mortgage. I even heard a story of Oprah’s Mom saying that the bank shouldn’t have lent her any money. They should have known better!

Where is the personal responsibility? Shouldn’t we all get our own financial houses in order? If you borrow money – it is your responsibility to repay it. If you can’t repay it, you shouldn’t borrow it. If you are going to borrow money over a period of 30 years – you should make sure you will be able to continue to make those payments for 30 years. If things are getting a little tight financially – who says you can’t work two jobs?

If you are a lending institution – why are you lending money to people who can’t pay it back? I have heard stories of banks lending money to people without jobs! Incredible! Lending standards need to be tightened. Does that mean that some people won’t be able to purchase a house? Yes – until they get their own financial houses in order. Depending on their own situation – it may always be more economical to rent than to buy. A good way to determine this is to use one of many rent vs. buy calculators like this one.

If you are a politician – God help you. Please support policies that limits Government intervention into our everyday lives. History is rife with examples of situations getting worse when government gets involved. Does the government really need to own banks? With government printing all of this bailout money – can this be good for the economy? I don’t think so.

Anybody and everybody should stop right now and embrace a dependency on God. I just read a post by Jeff Leake at the LaunchPad where he paraphrased Dave Ramsey. In it, Dave said that we should “shake off the spirit of fear and declare our dependence on God, who is far bigger than this economic crisis.”

Speaking of economic fear – the news keeps harping that home values are going down. Who does that really affect? Anyone trying to sell their house or refinance their house, right? If you are currently in your home, and planning to stay there for a long time – it doesn’t really matter does it? As for me – I’m actually looking forward to protesting my valuation for property tax purposes. If the value of homes are going down, I definitely want to pay lower property taxes! I’ll use the savings to add an extra payment toward debt elimination!

We Need More Space…and the money to pay for it!

18 Feb

I am going to begin this by saying that I don’t have the answer. I want to be clear right up front that I am as perplexed about this as the next person. But… I do have some things on my mind and hopefully, this will spawn a bit of a discussion.

A while back, I was teaching a course on Discovering God’s Way of Handling Money and I wrote almost daily emails to my class hopefully keeping the subject fresh in their mind throughout the week. One of the first emails I wrote had to do with Faith or Fundraising. I had been receiving (and still do) mailings from different Christian organizations requesting funds for their ministry. I know that I gave $50 to one of them 5 years ago and I still get monthly mailings from them asking for more money. They have most likely spent that whole $50 trying to get me to donate more. I haven’t opened a letter from them in years. It goes directly to the trash. So, I ask you…is that being good stewards of God’s money?

The church that I attend is currently having a space problem. We don’t have enough room to offer small group studies for adults or children on Sunday mornings. In fact, our Sunday mornings are getting more and more packed. It is obvious that we need more space. Our first attempt was to rent the gymnasium across the street for our services and let the kids have full use of our currently building. That relieved the space pressure – but for various reasons, we also lost a large number of people. About a month or so after we moved to the school, we decided to move back. Once we moved back to the church, we started filling up again. So, what do we do? We know we need more space but as a church, we want to be good stewards. Temporary buildings or more permanent buildings? Do we look at other locations? If so, will the people move with the church? I don’t have the answers. I see good points and bad points to all of the alternatives.

Another question I always ask myself is how much of our tithe should go toward financing church expenses? This is a big issue for me since I am a preachers kid. We grew up being paid by the members of the church my Dad was a pastor at. But the big question is, what is the tithe for? Is it to support big buildings and large salaries? (I will be the first to tell you that most full-time ministers don’t make large salaries – but there are those small percentages that make a lot of money.) Large staffs of church workers? Programs, programs and more programs? Or is it to care for the homeless, the sick, the widowed? Jesus conducted his ministry without a building or a salary. So did the disciples. Paul worked so his parishioners didn’t have to support him. When we give our money to the church we attend, how much should be spent on facilities and salaries and all of the expenses that go along with it, and how much should be dedicated to caring for the sick, homeless and poor? What is our primary function as a church?

My idealistic mind says that we should be spending as little as we have to on “overhead” and the majority of the money received toward caring for the homeless, the poor, the sick. Some have suggested that we only use 10% of the money given to cover the overhead and the rest toward caring for others who need it. That means that for a church with a $100,000 budget, $10,000 goes toward administration and $90,000 toward caring for those in need. Do you know of a church that does that now? I tend to lean toward more of a middle ground option. Here’s an example I read about. A church decided that it needed a larger building to meet their current needs. It was decided that the church needed to raise $500,000 to build a new multipurpose building. The leadership of the church was also in tune with what their primary mission should be so the leadership approached the church with the proposal that although they needed $500,000 to build the building for the church, they wouldn’t start building until they raised $1,000,000. $500,000 for the building and $500,000 to be used to directly benefit the homeless, sick, poor and needy in their community. Can you guess whether or not they had trouble raising all of the money? Of course the congregation got behind the leadership and giving actually went up. They raised the money faster than they had planned for.

Like I said at the beginning of this post, I don’t have any answers yet. For me, every question begets another question. I see a legitimate need for a full-time staff to serve the needs of the local congregation – more and more who have never attended church before. There is also a need for the church to be actively serving the needy in their community both financially and physically. Here’s a thought. If churches actively supported organizations and ministries that served the homeless and needy in our community, those organizations wouldn’t have to spend millions on fund raising.

One last question to leave you with – As Christians, what is our main purpose here on earth?

I’d like to hear from you….

Want to know where your money goes when you give to your favorite charity?

Charity Navigator is a great resource.

Wrapping It Up

28 Oct

As we wrap up this study on Managine Money God’s Way, I want to review the main points of the study. I hope that you have been working on utilizing these principles of money management in your daily life.

  1. God owns everything. “The earth is the Lord’s, and all it contains” (Psalm 24:1)
  2. Avoid Debt. “Just as the rich rule the poor, so the borrower is servant to the lender.” (Proverbs 22:7)
  3. Seek Counsel. “And one standing alone can be attacked and defeated, but two can stand back-to-back and conquer; three is even better, for a triple-braided cord is not easily broken.” (Ecclesiastes 4:12)
  4. Absolute Honesty. “The Lord loathes all cheating and dishonesty.” (Proverbs 20:23)
  5. Generous Giving. “Remember the words of the Lord Jesus, that He Himself said, ‘It is more blessed to give than to receive'” (Acts 20:35)
  6. Hard Work. “The Lord God took the man and put him into the garden of Eden to cultivate it and keep it” (Genesis 2:15)
  7. Save, Invest. “Steady plodding brings prosperity; hasty speculation brings poverty.” (Proverbs 21:5)
  8. Train Children. “Train up a child in the way he should go, even when he is old he will not depart from it.” (Proverbs 22:6)

As Pastor Bart said in his message last Sunday,

Financial freedom is achieved by becoming a faithful steward. Financial success is achieved by remaining a faithful steward.

If you enjoyed this study, you may also like to complete the more in depth study offered by Crown Financial. If you know what podcasts are and would like to subscribe to a daily 3-minute podcast from Crown entitled “Managing Your Money”, here is the link.

Keeping up with the Joneses

27 Oct

JonesesI have a confession to make. I used to make a lot less money. I used to dream of the day that I would make more money so I could save more. It always seemed as though I was living paycheck to paycheck. Today, I’m making more money and yet, I’m still living paycheck to paycheck. Why is that?

Without trying to get too bogged down in self-analysis, the simple reason is that I didn’t (and sometimes still don’t) discipline myself. As my income increased, my standard of living increased. I wanted things that I saw others have. Granted, we have four kids now – they cost something! (And I am beginning to believe that girls are more expensive than boys.) But isn’t there truth to the concept of “keeping up with the Joneses”?

Bling Covered AlbumnAds on TV and our culture in general encourage this type of thinking. According to them, you have to have the latest, greatest, biggest, coolest, hippest lifestyle available today! And tomorrow, you need more. If you watch any music television, you know you aren’t cool unless you are covered in bling, wear baggy clothes and show your underwear. We should all be driving hummers – the H1 for me – and your car is old if it is over 2 years old. In fact, you can get more car if you lease it because you should always be driving a new car! Everyone has two car payments – it’s no big deal!

Do you see what you are up against? That is why we have to develop the attitude that all the stuff we surround ourselves with is not ours but Gods and that we shouldn’t ask ourself, how much should we give God, but how much of Gods stuff should we keep for ourselves? Consider things with an eternal perspective. Our culture tries to persuade us to gratify ourselves now with no thought to tomorrow. An eternal perspective would have us deny immediate gratification for future rewards.

Moses faced a similar decision. Moses was Pharaoh’s adopted son. He could have a lavish lifestyle. But Moses had an eternal perspective. Read Hebrews 11:24-26. Moses chose to live (and be ill-treated) with his people instead of being called son of Pharaoh’s daughter. By having this eternal perspective, he was used by God in a great way!

Pastor Bart said it on Sunday – “Financial freedom is achieved by becoming a faithful steward. Financial success is achieved by remaining a faithful steward.”

Teach Your Children

26 Oct

One of my all-time favorite bands is Crosby, Stills, Nash and Young. I like the harmonies, the simple melodies and thought provoking lyrics. When I listen to them, it just puts me in a relaxed mood. It takes me back to my childhood. I’m sure most of you could sing the words to the hippie anthem “Teach Your Children” even if you didn’t know who sang it. It almost has a campfire feel to it.

Have you ever just concentrated on what the words actually say? Here’s the first verse:

You Who Are On The Road
Must Have A Code
That You Can Live By
And So Become Yourself
Because The Past
Is Just A Goodbye.

Teach Your Children Well
Their Father’s Hell
Will Slowly Go By
And Feed Them On Your Dreams
The One They Picks
The One You’ll Know By.

Don’t You Ever Ask Them Why
If They Told You, You Would Cry
So Just Look At Them And Sigh
And Know They Love You.
Teach Your Children, Graham Nash, CSN, Deja Vu (Released 1970)

Teach Your Children

Somewhere in Graham Nashes lyrics, came the truth of our lives as parents. Our children learn from our “hell” and from our vocalized “dreams”. We need to have a “code” to live by because they will learn by our example. It is up to us to “teach them well” so that when they get older, they will be able to make the right decisions because ultimately, they are the ones who inherit the world that we are leaving.

Let’s all try to make sure they’re prepared.

Deny Yourself

25 Oct

I want a garage full of power tools. I know that given the right tools, I could build anything. I could also use a new computer. The laptop I use is years old and on it’s last leg. I would like a new car. My current one was totaled in a hail storm and has dents all over it. I would like a camper so I can take my family camping. I would like to replace my regular camera with a new digital camera.

There are a lot of things that I would like to have. There are times when I am out shopping that I could just buy something for myself. I don’t. I deny myself these wants in order that I can buy the things that I need. I can plan – take care of my tithe, my savings, my needs and then save for the things I want – or, I can give in to the greed and just buy it right away.

It’s important that I share this whole decision making process with my children. As a parent, I have a responsibility to teach my children how to handle money responsibly, God’s way. We teach best by leading by example. It’s important that they see that I too want things. That I have priorities. That I plan. That I deny myself the instant gratification. I want to involve them in the process so that they can understand that we don’t always get what we want. That there is a difference between need and want. That will help them deal with the no’s they will get from me when they ask for things. They will eventually understand that their needs are really wants and that if they really want something, they have to plan, save and be patient.

It is up to us, as parents, to leave our children a legacy of stewardship. If we teach our children at an early age to be good stewards of God’s money, they will have a head start in achieving financial freedom.

Teach Your Children What You Have Learned

24 Oct

The life-long benefits of teaching children good money habits make it well worth the effort. Children who are not taught these lessons pay the consequences for a life-time. Here are a few guidelines to consider:

  • Guide and advise rather then direct and dictate.
  • Encourage and praise rather than criticize or rebuke.
  • Allow children to learn by mistakes and by successes.
  • Be consistent while taking children’s differences into account.
  • Include all family members in money management discussions, decision making, and activities as appropriate for their age.
  • Explain to children what they can and cannot do and the consequences of violating the limits.
  • As children get older increasingly include them in discussions of limits and consequences.
  • Expect all family members to perform unpaid, routine household chores based on their abilities.
  • Express your desire to have things you can’t afford. Children need to know that parents say “no” to themselves, too.

Top 10 Financial Stresses in Family Life

21 Oct

Top 10 Financial Stresses in Family Life

(Percentage of families experiencing stress)

Money for food, clothing and energy 45%
Purchase of a car, or other major item 43%
Taking out a loan 31%
Children’s education 29%
Problems with family income 26%
Medical/dental expenses 23%
Purchase or construction of a home 16%
Bad investments 16%
Overuse of credit cards 15%
Starting a business 10%

Together Forever, Aid Association for Lutherans, Appleton, WI, 1997, p. 51

What Money Means to You

20 Oct

Rate each of the following statements:

1 = Strongly disagree
2 = Disagree
3 = Undecided
4 = Agree
5 = Strongly agree

1. It is important to me to maintain a lifestyle similar to or better than that of my peers.

2. In making a major purchase, an important consideration is what others will think of my choice.

3. Since money equals power, I am willing to work hard for money in order to have more power.

4. I really enjoy shopping and having nice things.

5. Saving money for a rainy day is an important principle to live by.

6. If I had a moderate amount of money to invest, I would be more likely to put it into multiple resources that are relatively safe than into one fairly risky source that has the potential to make a lot of money.

7. Being “flat broke” is one of the worst things that could happen to me.

8. Saving for retirement is an important financial goal for me.

9. If I suddenly came into a windfall of $1,000 for something I have always wanted to do or have. I’d spend it.

10. Since “You can’t take it with you,” you might as well spend it.

11. Money can’t buy happiness, but it sure helps.

12. Few things in life give me greater pleasure than making a great buy.

13. I like/would like having my own business because I can/could control my own financial destiny.

14. I like being able to make decisions about how to spend the money I earn.

15. It bothers me to be dependent on someone else for money.

16. I feel uncomfortable if someone offers to “pick up the tab” because I feel indebted to them.

Now, add your scores for the four questions in each category. The higher your score, the stronger you identify with that approach.

Category Questions Your Score Your Partner’s Score
Money as Status 1-4 __________ _________
Money as Security 5-8 __________ _________
Money as Enjoyment 9-12 __________ _________
Money as a Control over Life 13-16 __________ _________

Interpretation of Scores

4-8 = Low
9-12 = Moderate
13-16 = High
17-20 = Very High

Understanding what it means:

Money as status. People who identify with money as a status symbol are interested in money as power-as a means of keeping ahead of one’s peers.

Money as security. People who use money as a means of security spend conservatively and focus on saving.

Money as enjoyment. People who view money as a means to enjoyment get satisfaction from buying things for themselves and others.

Money as control. People who see money as a source of control, use it to maintain control of their lives, and to remain independent from their partner or other family members.

Now, compare your scores with each other. The closer your scores in each category are, the easier it will be to meet mutual financial goals and needs. The further apart they are, the more negotiating and compromising you’ll have to do.

Reprinted by permission of Warner Books, Inc. of New York, New York, U.S.A. From The First Year of Marriage by Miriam Arond and Samuel L. Pauker, M.D., Copyright by Miriam Arond and Samuel Pauker. Quoted in Together Forever, Aid Association for Lutherans, Appleton, WI, 1997, pp. 46-57

Another Story of Saving

19 Oct

Joslyn Art Museum
Mrs. Sarah Joslyn wanted a memorial for her late husband, so she started saving money to build a museum. The wealthy widow scrimped, wearing old hats and darned gloves. It was reported that her chauffeur was embarrassed to be seen with her.

But when the Joslyn Art Museum was completed in 1931, it was paid for. She may have gotten her frugal ways from her husband. A painting of George Joslyn shows him wearing a stickpin that he got free from a sack of Bull durham tobacco.

(Last Word, Omaha Magazine, Sept/Oct 2005, pg. 78)