Family Money‏

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I am not a financial expert, and I have no ambition or qualifications to act as a financial planner, but lately I feel God has been helping me explore how to deal with stress around our family’s finances.  How often have you thought a windfall like winning the lottery would reduce your stress level by 100%?  Could you envision your life without debt or the stress surrounding monthly budgeting?  Just mentioning budgeting makes many people lock up, and want to stop the conversation, but I have noticed a distinct difference in my outlook lately, and believe it is God showing me how he can offer peace in the midst of less than perfect circumstances.

I have made more financial mistakes than the average person.  As mentioned in the intro to this site, we got into tremendous student loan debt early in our marriage, and have found credit cards and car loans to be an issue from time to time, but by the grace of God we are learning to be better through each experience.  There are lots of great sources to help with family budgeting and financial prosperity (see Dave Ramsey’s Financial Peace U or Robert Morris’ The Blessed Life), but sometimes when you are in the midst of financial adversity, you do not want to hear a lecture, or are overwhelmed by not knowing where to start.  Sometimes the thought of getting your finances in order is so stressful, you miss the opportunity to make any progress, since you want immediate relief.  I have been surprised that the answer to your stress may not be as far off as you imagine.  What follows are some ideas we have used to allow God to help our family through financial struggles, and finding more prosperity than we imagined.  It is my hope that this will be so simple, you can implement it starting today!
 
Use Your Faith 
Concept: Financial struggles cannot consume your generosity towards others.
 
We have all heard ministers go on and on about the benefits of tithing, and there are people on each side of this topic, but I want you to look at your faith and finances in a different light.  I am not going to give you a guilt trip about how much you are giving, but instead want to urge you to look at your current circumstances and give them to God.  I am not telling you now is the time to sell everything and become a missionary, instead I want you to determine that you can take the energy you spend stressing out about your finances, and look for a way to give back instead.  Maybe you do want to give money to charities and your church, but I think God is looking for more than your money.  I have known enough stingy “well off” people who give >10% of their income to understand that tithing does not automatically make you generous or change your heart.  I think you will be amazed by the happiness you find in not focusing all of your energy on things you cannot fix overnight, and start doing something immediately to make someone else’s life better.  Maybe you will find texting friends or family positive notes to check in or wish them well is all you have time for, but if you start today, before you know it, you will be fueled by the positive impact you can have on others in spite of where you are financially.  Yes, there is great hope in knowing some day we may all be able to live off of 10% and give the rest to those who need it more, but do not lose heart if you are not there yet.  If we look at the bible’s perspective on giving, I think it focuses more on where your heart is and less on the amount:
Give generously to them and do so without a grudging heart; then because of this the LORD your God will bless you in all your work and in everything you put your hand to. [Deuteronomy 15:10]
The people rejoiced at the willing response of their leaders, for they had given freely and wholeheartedly to the LORD. David the king also rejoiced greatly. [1 Chronicles 29:9]
Woe unto you, scribes and Pharisees, hypocrites! for ye pay tithe of mint and anise and cummin, and have omitted the weightier [matters] of the law, judgment, mercy, and faith: these ought ye to have done, and not to leave the other undone. [Matthew 23:23]
 
Find Joy Where You are Now
Concept: Putting all of your focus on the future causes you to miss out on today.
 
I had a co-worker who was not the most religious person, but he had a really biblically sound approach to retirement.  He would work when the economy was really strong, looking for the best paying jobs during those times, and then took mini retirements (sometimes only a few months long) when things slowed down.  He told me it is important to enjoy life while you have the chance, even if it means getting in a little debt from time to time.  To put it another way, our experiences are eternal, but our possessions are not.  My wife is really good at this aspect of our finances.  She likes to plan trips for us (often times as economically as possible), while I get wound up about how we will be able to afford everything.  The reality is, I remember every trip we have taken with tremendous joy, and really do not remember much about the stress of saving and paying things off in particular detail.  That being said, I have driven cars that cost significantly more than those trips, and each time I got in those vehicles I dreaded the amount I was spending just getting around town.
There are two concepts I want to share regarding finding joy in each day: 1) It is ok to spend money on experiences (I am not advocating taking a $20,000 cruise around the world – focus on the experience instead of how exotic it is), and 2) If we are always saving for the future, there is a chance we will never really enjoy life along the way.  Although I have given several examples regarding trips, it is also essential to know that sometimes this principal does not cost a thing.  Simply taking a walk with your spouse, playing with your kids, or cleaning up the garage are ways to find joy in a simple day.  If you stack enough of those positive experiences up on a daily basis, you will have something to look back on besides the stress you are currently facing.
 
Keep it Simple
Concept: Finances, like diets, need to be simple to maintain or they will not have a lasting impact on your life.
 
When we start to notice our financial thermometer spike, I have found it is often a relief to open up our budget to itemize  and track expenses, so we can get a better understanding of where our money is going, but my wife does not always share the same joy in seeing everything line by line.  I have noticed part of her hesitation to sit down and discuss things is 1) the budget ends up being a tool we use to beat each other up with, and 2) we get obsessed with every little purchase.  With that in mind, I think it is essential to make sure you are not grossly over spending through a quick budget, but similar to not weighing yourself every day when you are on a diet, do not get overly focussed on tracking and controlling every expense.
What we have found to be the most effective means for actually impacting our finances is actually pretty easy.  We look at our biggest unnecessary expenses and focus our attention there.  Often that means eating out less, since that is where a large portion of our disposable income goes, which also means we benefit from eating healthier!  When a change in your life impacts you in more than one way, the compounding result can really fuel your attitude and progress.  In case you think changing your biggest expense or habit is impossible, Charles Duhigg has a great book on identifying why we do certain things, and how change is actually easy once we realize how we are wired.  If you would like to get a jump start on positive change, I recommend reading this short excerpt from Mr. Duhigg to see how simple change can be: http://charlesduhigg.com/the-power-of-habit/.
 
Get Creative
Concept: Find ways to make money and fund your dreams.
 
One thing I have noticed from following different financial planners is they always make it sound so easy.  Finances are easy, you just spend less than you make, right?  The reality is, finances are pretty easy when you have a multi million dollar best seller, or you were fortunate enough to have frugal parents who taught you not to buy everything on credit.  The problem is we all fixate on our mistakes after we make them, and it is really easy to beat yourself up daily for those bad decisions.  It is my hope that you will start to look at the positive things in your life instead while actively doing something to improve your financial future.  You can have joy even when you are not a financial rock star, and life cannot be spent wallowing in sorrow each day.  We have already discussed finding joy in your daily life, so to fuel your positive outlook, you need to start impacting the fun side of the equation: you need to find ways to make money.
Here is what we have done to improve our positive cash flow:
1. Look at bills and renegotiate everything.  From calling your cable and internet companies to get the latest deals, to refinancing your home, there is always somewhere in your budget where you are overpaying.  This is simple and fun, just start calling the companies you pay every month and see what they have to offer.  Sometimes you can even mention their competitors or canceling to get especially good deals.
2. Sell what you don’t use.  Craigstlist and Ebay will become your friends, and are simple ways to turn those belongings that collect dust into cash.  My wife has resold our kids clothes for years to help offset the expense.  In some cases, you can purchase seasonal outfits and resale them on Ebay to pay for holiday clothes.  If you are looking for an excuse to buy brand name clothes, look into their resale value and you may be surprised that the most frugal approach is not buying everything from Wal-Mart.
3. Start an online business.  This sounds cheesy, but read Tim Ferriss’ 4 Hour Workweek http://fourhourworkweek.com/ to get motivated.  We opened a small dancewear store when we noticed we were spending quite a bit on dance clothes for our kids, which has been both a great learning process and a chance for my wife and me to spend more time together working on a common goal.
4. Invest intelligently.  For years I had heard about buying and holding investments for the long haul, but was perplexed to see huge down trends that were difficult to dig out of through those long term cycles.  The Ivy Portfolio (http://www.theivyportfolio.com/) is a valuable way to see how the market can actually be timed very effectively, and you may realize that your current “low risk” approach is much riskier than you realize.
5. Don’t be afraid of work.  From working some overtime to getting a part time job, there are ways to make more money if you are willing to put in a little extra effort.  This is not always our first choice, but it is one that always works.  As a nice bi-product, if you have a problem overspending, working a little extra will make you focus more on your purchases.
 
Does it Sum Up?
 
Although being financially engaged is essential to our families’ long term success, I think the biggest thing God has worked on in my life is enjoying the journey.  Except for a very small portion of society, we all have to work, and even though it is easy to be jealous of other people’s success, it is important to live your life to its fullest and not waste time chasing someone else’s empty dreams.  God has amazing things in store for you, and there is joy where you are now, if you will simply look for it…Jeremiah 29:11.
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