The Christian and Money

Sunday I preached the first message in our series “Money and the Christian.” You can watch the message here. In the message I laid out some basic principles from Jesus’ teachings and Paul’s letters. I mentioned some practical tips briefly Sunday and I’ll dig deeper on those in the bottom half of this post. To start, here’s the vision Jesus has for money:

MONEY IS A USEFUL TOOL, BUT A TERRIBLE GOD. Jesus and Paul warn about the dangers inherent with money. The bible doesn’t condemn or condone welsh. In some passages the abundance and wealth are celebrated when God blesses His people. In other passages and parables the hazards of wealth are clearly laid out. Money isn’t the issue, what it can do t our heart is the issue.

GRACE IS HARD TO UNDERSTAND IN A TRANSACTIONAL CULTURE. One of the dangers of wealth is pride. Wealth convinces us we’ve earned everything and anything can be purchased. The gospel is specially hard for the rich because it isn’t a transaction. We can’t earn this love or forgiveness.

HOW WE STEWARD TREASURE HERE IS HOW WE LAY UP TREASURE THERE. Jesus lays out a vision for laying up treasure in heaven in Matthew 6 and Paul picks that theme up in I Timothy 6 . Paul instructs the wealthy to use their wealth to be rich in good works, generous and ready to share.

Practical tips when it comes to money

1 You Need a Budget

I know that inflation has made this harder, but the truth is: living below our means is never easy. It requires diligence and sacrifice. I once heard Tim Keller say in this powerful message that Xians are called to refuse the temptation to let their wealth determine their lifestyle. Instead they’re constantly living at the lower end of what their income could afford for the purpose of making generosity prominent in their lives. This is only possible with a realistic budget. Here’s a great resource on budgeting that gives an overview and has a budget you can input your numbers to get started.

2 Your Budget Needs Margins

Most people want to be generous, but feel strapped because lifestyle creep has robbed them of any margins.

Margins don’t just happen, they’re planned. What used to be a luxury, but now feels like a necessity? The moment we allow wants to become needs we kill margin.

Here are 3 margin killers

• Meals: Remember when eating out was a luxury? Over time we get used to the convenience and speed of just ordering to go or driving thru to get our meals. Our family eats home cooked meals most evenings and mornings. If we eat out it’ll be Friday night or Sunday afternoon. We budget for this. There have been busy seasons where we’ve leaned on restaurants and fast food. Every time we end up spending 2-3x as much for lower quality food. I know there are seasons of life that are busy, but cooking and eating real whole foods at home is better for your budget and your health.

• Vehicles: Our cars are one of our largest line item expenses in our budget. Often we just think about the car payment as the cost of owning a car. There’s insurance, gas, maintenance, etc. We’ve never had more than one car payment and that’s been on purpose. We always wait until one car is paid off to consider buying another. This forces us to be patient. We’ve also never spent what we were qualified for (goes back to lifestyle creep). Just because you can afford it doesn’t mean you need it. Dealerships shouldn’t determine how much car you can afford, your budget and spending goals should. We also research how much any vehicle will cost to insure. My daily driver is a small Honda that gets 46mpg. The temptation is often to purchase the most car we can afford because a coworker or friend got one and now we need one too. I am often tempted to buy a new truck, but our 1998 s-10 just refuses to die. As a result of delayed gratification, we can be generous, save for the future and rest easy in the area of finances.

• Random Purchases Retail therapy is real. We feel down or off and think, “I bet a new outfit, shoes or device would make me feel better!” And it does… for a while. When you’re living below your means you know you can do this occasionally, which makes it a constant temptation. I once heard it said that women splurge in several small shopping trips over time and men in one large purchase. Think the lady who constantly spends 100’s of dollars here or there but never in one huge shopping trip. Now picture the man who’s been pretty conservative fiscally, but comes home one day with a new truck, motorcycle, rv, or boat. There’s no remedy like the emptiness of dealing with the consequences of these spending episodes. It takes time and commitment.

3 You Need a Generosity Plan

Have you prayed about how much and where you’re going to be generous? Casie and I have always tithed and we automate that portion of our giving. Every week it comes out of our account via online giving. I’m for regular, disciplined giving, but we also want to be spontaneous in our giving. So when we give to missions, benevolence, or a major endeavor at church, we pray and consider how much to give and do it on a Sunday either by check or a one time gift online. We don’t want our giving to become mechanical or lazy. Our church operates the same way. Each month there are regular donations from our church to missionaries around the world, non-profits in our community and church planters around the nation. However, we also respond to needs as they arise. Our church gives to benevolence needs inside our church regularly. At the end of every year we’ve given single moms in our church a few hundred dollars to help with Christmas for their kids. Generosity has to be more than aspirational. It must be built into our budget and our lifestyle.

Let's talk about money

Recently I spoke about giving at church. You can find the video here.

I’d like to add some practical tips for handling money because

1. Many would like to give, but feel they can’t afford to give.

2. Many of us need help handling our finances, even those who are giving.

3. The culture has given us a misconception about money and it’s purpose.

I want to share some basic principles that have helped us gain financial security and enabled us to increase our generosity. When Casie and I got married in 2006, we realized that we were both savers. We’d been saving money for most of our lives because we were raised to save. Many people aren’t, and I’d like to share with you how we saved, invested and utilized money. As a result of these practices we are able to free up our schedules and say yes to what matters most.

1. We always give and save first. We set aside 10% for giving and 10-15% for saving. We enrolled in every 401k match, company stock option, etc that we were offered. When we were in our 20s this meant making sacrificial decisions. We didn’t buy our dream home. We bought a duplex and rented half of it out. We didn’t buy expensive new cars. We bought dependable used vehicles. We learned to cook delicious meals and made eating out a special treat. Even now, we typically prefer the food we cook at home to what we find in many restaurants. Our vacations for many years were either camping trips or low cost destinations.

   This is difficult if you’re not making middle class income. Our first few years together, we typically had extra jobs or income from side hustles. Casie went back to school to get a Master’s Degree in her field. You may need to finish a degree, become an industry apprentice, or save to start your own business. Many of times we struggle to save because we are over-spending or under-employed or we aren’t taking full advantage of their expertise and skills we’ve acquired. Nothing worth doing is easy or quick, but commit to the long process. Start making good decisions now, and they’ll snowball as your income and savings grow. By the way, I still work at FedEx part-time because of their benefits. We don’t need the income, but we enjoy the benefits. I don’t know that I’ll ever quit. Stop believing that you need to arrive at the top of some corporate ladder or save millions to live a generous life. You don’t need millions or a six figure income. You need simple principles and determined effort.

   The reason we give and save first is to establish a line in the sand. I need to learn to say no because I’ve already invested or saved that money. I need hard rules that encourage wise decisions instead of frivolous spending. I need to commit to saving and giving as a discipline in my life that will lead to generous outcomes.

2. We purchase more assets than liabilities. An asset produces income or grows in value. Conversely, a liability loses value and typically produces little or no income. An asset could be a business, real estate, investments or a degree (depending on the institution and job sector). Liabilities include vehicles, boats, furniture, vacations, etc. You have to purchase some liabilities, no doubt. I need a vehicle, food and a home. However, I don’t need a brand new vehicle or a newly built 3,000 sf home. Over the years we’ve purchased assets and delayed the purchase of liabilities. I still drive the truck I bought in college for about $9,000. Last year we could have purchased a new truck. Instead we invested the same amount and purchased another rental property that produces income. Trucks lose value over the long term, real estate (typically) grows in value over the long term. By the way, that rental property generates enough profit to cover a truck payment if I really want one (spoiler, I don’t).

   I’ll admit, liabilities are way more fun to buy. However, assets give you the freedom to decide what you do with your money and time. Let me put it this way. The rental properties we’ve acquired were difficult to purchase. There’s paperwork, proof of income, closing deadlines, etc. Liabilities (boats, cars, vacations) can typically be purchased in a few minutes or hours. However, our assets produce income and therefore give us freedom. We can decide to spend the money and time these assets have freed up however we like. Liabilities, on the other hand, tie a noose around your neck. You can’t take a week off because you need the overtime to pay the monthly payments and insurance attached to the liability. Avoid liabilities. purchase the cheapest liabilities you can. Don’t buy the most house or car you can afford.

3. We found free and inexpensive ways to enjoy ourselves. We love riding our bikes, hiking trails and spending time on the water. You don’t have to spend money every time you want to have fun. Lately, we’ve been running and hiking more often. Most of our favorite places to visit don’t cost money. Even our vacations are inexpensive. We typically fly (for free thanks to points and Southwest) to a city close to a National Park. We’ll camp for $15 per night in an amazing new setting for a few days. We bring our meals and supplies with us on the plane. We’ve been to dozens of amazing parks while spending only a few dollars per night. You don’t have to spend a fortune flying to exotic places and staying at extravagant resorts to unwind and relax. We save those rare occasions for big anniversaries or achievements (the assets give you the freedom to do that, but you don’t have to spend every dollar you make).

   Lately, I’ve been playing more basketball. There are tons of good courts in my city where I can play pick up ball. No membership. No gym fees. Casie takes the dogs running and enjoys rollerblading (hello 1996). It says a lot about us, when we feel we have to spend money to have a good time. The culture has brainwashed us into thinking we can only have fun if we are spending money. You can enjoy the weekend without spending tons of money eating out and shopping. Our lives should be so much more than a receipt of purchases we’ve made along the way.

4. We keep an eye on our budget. You thought you’d get through this post without the b word didn’t you? We had a budget before we got married (it wasn’t realistic). We have been constantly adjusting our budget ever since. We have regular financial conversations to keep us committed to good habits. We have a plan for money. We tell it where to go and what to do. We never find ourselves asking, “what should we do with this money?” Your budget will tell you what you can and can’t do. We have our current budget, next year’s budget and our dream budget (once some of the rental properties are paid off completely). Too many people have a theoretical plan of how they’d spend $10M from the lottery, but no idea how they’re going to spend the money they’re actually making. If you’ve never been through Financial Peace University, I’d encourage you to consider attending. If nothing else, read the book Total Money Make-over by Dave Ramsey. Everything really comes down to a decision followed by determination. It took a decade for us to see some of our decisions pay off. Keep after it. Adjust the budget when you get a raise. Make changes when you pay off that debt or car payment. Ideally, every debt you pay off should free up money to be saved, invested or donated.

I want to remind you the why matters more than the what. I believe anyone can make money and create wealth. You have to know why you’re doing it. I’m not saving and investing so I can retire to a golf-course community (nothing against golfing). I’m not saving up for a yacht (my 13’ boston whaler is pretty dope tho).

We are making these decisions to create freedom for ourselves now and later in life. We use this freedom (time and money) to invest in our family, our church and our community. Money doesn’t dictate my life or my schedule. We get to determine how we want to spend our time and energy. This freedom allows us to choose how we invest our greatest resource: time. What’s your why? Are you trying to free up time during this season to be present in your kids’ lives? Maybe you’re trying to create space in your schedule to start a business or launch an initiative for your community? When you have time and resources, you can invest them in what maters most to you. Find your why.

-Pastor Marc

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