Living by the 80/10/10 rule

During our generosity series (watch/listen here) I mentioned a simple rule that helped my wife and I start budgeting. It's not original. I've seen it numerous places. It's also not concrete. Starting this way has enabled us to grow beyond the 80/10/10 to where we are putting away more than 10% for retirement and giving away more than 10% to the church and missions. However, every great goal needs a simple beginning. The 80/10/10 was just that for us. Let's dig in.

The 80/10/10 rule goes like this: Live off of 80% of your income. Invest 10% in God's kingdom. SAVE 10% for the future. 

Simple right? First let's talk about why the 80% part is difficult. Often we believe the lie that money (and the world for that matter) is all about us. Scriptures encourage us not to let our lives be consumed by money and what it can buy (Hebrews 13:5). Furthermore Paul told us we are blessed, not for ourselves, but to bless others that God might be glorified (2 Corinthians 9:11). Let's be honest. Living off 80% of our income feels like we are missing out. At first it might. However, once you realize you don't need a brand new car, bigger home or every new gadget, living off of 80% is actually comfortable for most people. 

Here are some practical ways we've managed to live on 80% (even less now) of our income:

Drive dependable cars for the long haul

Let's address the reality of the situation. If your car has a decent stereo and AC that works, it's a pretty great ride by historical standards. Ten years from now nobody will care if you had the newest, fastest or most luxurious ride in the neighborhood. I've had my truck paid off for years. It turns 20 this year. I love looking at big trucks. However, I value $400-650/month too much to spend that on a truck I don't need. That money goes a long way toward living below your means. If you can avoid the big car payments in your 20s and 30s, you're freeing up margin for the future.

 

 

Never let the bank tell you which mortgage you can afford

Casie and I have never asked a mortgage broker how much house we can afford. We aren't interested in a house payment that eats up 30-35% of our income. This always seems to be difficult for young couples. We see our friends buy a big or new home and convince ourselves we are missing out. Hear me. Margin is freedom. By building margin into our financial lives, Casie and I have never felt obligated to keep a job or work extra overtime. I enjoy my work at FedEx and the church. She enjoyed teaching. We both invest some time in real estate investing. Our time and careers are ours to determine. There's no looming mortgage payment or debt burden that forces us to stay in jobs or careers we don't feel called or committed to. This has allowed us to both work primarily in the ministry/non-profit world. We can pursue our calling freely. Don't allow your desire for a model home rob you of your future freedom (eating out when you want, going on vacation, taking sabbatical, etc). 

 

 

Avoid credit card debt

Let me admit something. I have a credit card. Casie and I have been using the Chase SW card for 4 years now. We've literally been flying free for 2 of those years by taking advantage of the points and companion pass. However, we weren't ready for a credit card at 22. We didn't use a credit card until we were close to 30. We always pay off the balance. In our 20s we were careful to avoid credit cards because we'd seen crippling credit card debt ruin people's financial lives. Many cards have 15-30% interest rates (just under what the federal government considers loan sharking). That kind of interest can kill your chances at an early pay off. When you realize just how much money you're losing to credit card lenders, you begin to see why it's such a lucrative business (for them). This gets into the good debt vs bad debt debate which I'll cover later in this series. I can't wait to continue the conversation on money myths in our next part of the series. 

If you don't have a personal budget grab one here from our friends at Dave Ramsey Solutions. Tell your money where to go. Stop wondering where it went.

-Pastor Marc

Three ways to live generously

---

give some of your treasure

Our first thought when it comes to generosity always goes to money.  Many in the church give a tithe of our income, but is that where giving stops? Giving to the church should only be the start. There are plenty of people in our city that are struggling. How can you give some of your treasure? Maybe it looks like supporting a local food bank. Maybe it looks like finding someone who hasn't eaten today and paying for them to have food. What if you paid for the groceries of a single mom next week? Jesus said where our treasure is, our heart will be. Let's have a heart for the church and our community.

Give some of your talent

We often assume that talent only relates to playing an instrument, juggling, or performing a back handspring. Those are great talents to have, but there are so many more things out there we can use. This week one of our guys was retelling the story how he met his neighbor. His neighbor is 20 years younger and really looks up to him because he's handy. The last few weeks they've been changing oil, simple home maintenance and more. This middle-aged gentleman is being generous with his talent. As a result he's mentoring a young man he just met. Maybe you can affect your neighborhood just by going out to love and encourage your neighbors. Maybe you're the kind of person who is good at orchestrating and gathering people of different talents to do a great thing in your community. When you know what you're capable of, you can begin to share that talent with others.

Give some of your time

This sounds so simple, but sometimes giving our time is the most difficult thing to give. You've probably had a busy week. Things have not gone the way you had hoped and you've been playing catch up since Monday morning. During those kinds of weeks we long to have some ME time, but it's during those times that we often turn off the issues that others around us are experiencing. Maybe you have people that are asking for some of your treasure, or some of your talent, but there are plenty of people out there that just want some of your time. Be willing to give someone your ear. Be willing to give someone your Saturday morning. You'd be amazed how many people are starving for relationship and community.

Sometimes we are guilty of telling ourselves we'd be more generous if we had more time, talent or treasure. We look at someone and tell ourselves if we were in their shoes things would be different. The hard truth is many of us do have more time, talent and treasure than those we come into contact with. Let's not wait until we've got everything worked out to be generous. Start today.