Dear Chuck,
When should we begin tithing? We are currently in ‘the red’ each month, relying on credit cards to fill in small gaps. It will take us a couple of months to adjust and stop living paycheck to paycheck. Currently there is no extra, no savings, etc. If we tithe now, we will have to stop payment on another creditor, which seems irresponsible. What do you suggest?
Too Tied Up to Tithe
Dear Tied Up,
Thanks for a great question! It is one that causes many debates and in some cases undue pressure, guilt, and shame. However, I am sincerely glad that you have the desire to tithe.
In 1999, although I had been a church-going Christian for most of my life, I was only giving 2.6% of my total income – the national average in America. Through the conviction of Scripture, a Crown Bible study, and the encouragement of my wife, God changed my heart. Since then, we have been able to make changes and regularly tithe. It has been a tremendous blessing to experience the promise of Jesus that it is more blessed to give than to receive. (Acts 20:35)
Let’s begin by defining “the tithe” as willingly, cheerfully donating 10% or more of your total income. It is very difficult to gather accurate information but somewhere around 10-12% of all Christians actually tithe. While this number is double the general population, it remains woefully low.
As a steward, we must first recognize that everything we have belongs to the Lord. We are simply managing it for the Father and His Kingdom. If you believe that, then you as a couple should agree to use all of it in a way that honors Him. I find that a better question to ask ourselves is, “How much of God’s money should we be living on?” vs. “How much of our money should we be giving?”
Remember that giving is not a tax or a legal requirement to please God, but a voluntary act of worship. It is a tangible way to express our love to God.
Do you remember the story of the widow and her offering? Mark 12:41-44 reads,
And He (Jesus) sat down opposite the treasury and watched the people putting money into the offering box. Many rich people put in large sums. And a poor widow came and put in two small copper coins, which make a penny. And He called His disciples to Him and said to them, “Truly, I say to you, this poor widow has put in more than all those who are contributing to the offering box. For they all contributed out of their abundance, but she out of her poverty has put in everything she had, all she had to live on.
The widow gave all she had because she believed God would meet her needs. Her gift of two small coins – small to the world but large to her – demonstrated her complete dependence on the One who loved her.
Many today give what’s left over after their needs have been met rather than setting a portion aside to God first. You may not be able to give 10% immediately but you can give something.
Paul said, Each one must give as he has decided in his heart, not reluctantly or under compulsion, for God loves a cheerful giver.
And God is able to make all grace abound to you, so that having all sufficiency in all things at all times, you may abound in every good work. (2 Corinthians 9:7-8)
God does not promise to reward your giving with lots of money or other earthly blessing (as the Prosperity Gospel proclaims) but you will experience blessing, perhaps not visible until you enter heaven and discover the treasures God has stored for you there. Just know that He promises to supply bountifully if you give generously.
Start giving now. Pray with your spouse and agree on a dollar amount to give each week. This should be an amount that does not cause you to default on your current bills or harm your marriage.
Then, give, even if you can only afford $1. As you give, ask God to multiply it for His Kingdom.
At the same time, I recommend that you begin to save so you can establish an emergency savings account. It is important to give first, then save next, even if it is a very small amount in each category! By working on these goals simultaneously, you will begin to make important changes in the way you manage your income.
Redo your budget. Decrease spending in one category of your budget (or several) so that you can be very intentional, making sure to add giving and saving to your revised budget. Crown has a number of free resources that can help you create, maintain, and improve your budget. You can start with an easy to use guide here.
Here are some ideas on how to immediately decrease your spending. Remember a little can go a long way!
When the offering plate comes your way, thank God for all He’s given you and that your heart’s desire is to give more to Him. Don’t worry that your gift is small. It’s between you and God!
1 Samuel 16:7 says, The Lord does not look at the things people look at. People look at the outward appearance, but the Lord looks at the heart.
Keep your heart focused on the things of eternity. Giving, saving, and getting out of debt will require you to have diligent hands and a faithful heart. Here are a few practical steps to take to pay off your debt quickly:
In my many years of teaching God’s financial principles, I have seen God bless those, like you, who follow through with the desire to make giving their top financial priority. That is why I am so grateful you have the desire. Now, let’s make it happen. Trust Him fully and give cheerfully. Be patient and don’t give up when things get tough. Ask the Lord to help you trust Him every step of the way!
Originally published on the Christian Post, April 20, 2018
Dear Chuck,
We have a son graduating high school this year and are trying to make plans for his college years. While he’s done an excellent job applying for and receiving scholarships, taking AP classes, and CLEP exams, we will still have to take out student loans. My question is who should take out the loans –my husband and me, or my son? Is it bad for us to make him take on the loans? Is it better parenting to just take the loans out ourselves and pay them off? Any advice would be appreciated!
Confused About College Debt
Dear Confused,
You ask some valid questions and I’m encouraged that you are seeking answers now! Far too many parents make emotional decisions before thinking through the ramifications and then find themselves in difficult situations both financially and relationally.
We are the parents of past and present college students so we know exactly what you are going through!
Approximately 44 million Americans owe more than $1.48 trillion in student loan debt. That’s $620 billion more than our total credit card debt. And, the average 2016 college graduate carries more than $37,000 in debt!
So, the perfect answer is that neither you nor your student should borrow money for college. And remember, it is possible to graduate from college debt-free! Your report that your student is doing well, taking CLEP exams, and seeking scholarships is very smart. This lowers the overall cost of their education.
Taking on student debt for your child does not make you a “better” or “worse” parent. So instead of using that terminology, let’s consider “responsible” parenting.
Ultimately, in my opinion, it comes down to this: The student loans in question are for your child and for their education. So you don’t need to put yourself in a financial bind trying to cover their education expenses. If you have to take out student loans, I would recommend that the majority, if not all, of the responsibility falls to the child instead of the parent.
However, I do think responsible parenting means you’re involved in this decision and equip your child to know what they’re getting into and assist in making plans to pay off the loans quickly.
Talk about the financial burden student loans will bring them and offer to help however you can. These financial conversations can actually be a blessing to your relationship with your teenager and help you bond in new ways.
While they’re still in high school, help them make a budget and create savings goals. Walk them through a resource like the Money Map so they have a holistic picture of their financial future.
Encourage them to get a summer job after they graduate high school and help them save every penny of what they earn. Maybe you can match them dollar for dollar on a savings goal for the summer. Help them apply for jobs or internships that will get them valuable experience and look great on their resume.
Encourage your student to make a list of every job, sport, activity, community service opportunity, and achievement they make during their college years in preparation for resume building. Talk to them about the possibility of working throughout college. Teach them to make wise financial decisions now so they can be financially stable later on.
Since taking on student loans is a serious financial commitment, there are a few things you can do to help decrease the severity of the debt.
First, help your child decide on a career path. This can be an overwhelming and confusing process for many high school students and recent graduates, but it’s important, especially when talking about financing college.
Crown has a Career Direct Assessment that will help your student discover their unique design and what career path suits them best. It’s a comprehensive assessment that examines personality, skills, interests, and values, all through a biblical lens. I would highly recommend your student taking the assessment and meeting with a consultant.
Help them make an informed decision and choose a career that is stable and achievable. You can read about 7 trending careers here.
Determining a career path will also help your student calculate an estimated starting salary upon graduation. Don’t ever borrow more than this anticipated annual starting salary. Fields that require extended education, such as doctors and lawyers, will have higher starting salaries but also require more education and more expensive loans.
Plan your student loans around their future career path, and don’t ever spend the loaned money on anything other than education. Also help them budget their student loans as a fraction of their estimated future income. It may be helpful to know which careers offer loan forgiveness or assistance.
You and your child should understand the Financial Aid Terms and definitions, and review smart borrowing tips here and here.
Ask lots of questions and don’t sign a contract without full understanding! Study your loan option and talk about what will suit your child’s needs best.
The Bible never says that debt is wrong. But it warns against accumulating debt (Proverbs 22:7) and co-signing (Proverbs 6:1-5), because of the financial burdens it causes us. If you decide to co-sign with your student on their loan, assume and plan like the loan is yours. In other words, you are just as responsible for the repayment as they are.
Make sure the lender grants you access to the same information that your student has to verify that payments are indeed being made. Late payments strain relationships and credit can be ruined, so be prayerful and cautious when making this decision.
Just over half of all college students actually graduate. Since this is a major decision for everyone involved, be sure to commit it to prayer and be cautious. In our home, by God’s grace, we were able to work around the challenges and avoid borrowing for college. My hope is that you will be able to do the same.
Originally published on the Christian Post, April 13, 2018
Hi Chuck,
I am part of the ‘Gig Economy’ and work full-time as a freelance graphic designer. Some months I am slammed with work and make a great amount of money. But then other months are really slim. I’ve found it’s really difficult to budget for these major ups and downs – I end up relying on my credit cards during the slim months and then a lot of my income during the plentiful months goes towards paying off debt. How can I make this work better?”
Thanks,
Needing a Gig Budget
Dear Gig Budget,
Planning is a necessary part of financial health for everyone, but especially the freelancer. You have more flexibility than traditional workers, but you also have different challenges brought about by the uncertainty of your income.
According to a 2017 report from Intuit, the contingent workforce or non-traditional segment makes up 36% of the U.S. workforce today, compared to 17% just 25 years ago. Gig workers, also known as on-demand workers, are part of that group.
So how do you budget on an inconsistent income?
Careful planning will be required to make it work. Fix your lifestyle according to the income earned during the lean months, so you can avoid going into debt or getting in a financial bind between periods when you are billing.
Don’t get caught up in the comparison trap! Many gig workers and freelancers have the flexibility to work from home, so take advantage of the savings that offers you. It may be tempting to work in an Instagrammable coffee shop or open-concept co-op office, but instead of spending $5 on a latte every morning or paying monthly fees to have an office space, maximize your home office to be conducive to your work. You’ll save money by eating at home, using less gas, and making your own coffee.
This is an essential part of everyone’s life, but especially the gig worker. The first step is to calculate your monthly base income. There are two basic ways to do this and you may want to use a combination of both:
Step two is to calculate your monthly expenses. More than traditional workers, freelancers need to have a running total of their fixed monthly living expenses: this includes mortgage/rent, insurance, etc. Then add your monthly variable expenses – things like groceries, utilities, taxes, and tithe. These are your monthly living expenses.
Once that number is set, add in the “extras” – buying new clothes, entertainment costs, etc. Crown has a helpful worksheet that you can utilize to write down all your monthly expenses.
Once you have your monthly expenses set, keep track of how much you’re spending for several months. No two months are exactly the same so keep track of how much you’re spending. Record your expenses by writing them down in a worksheet (this one is already set up for you) or connecting a budgeting app to your bank account.
These two steps are the “nuts and bolts” of your budget. Crown’s Easy Guide to a Budget You Love walks you through all these steps in more detail with extra help and tips and includes sheets you can fill out online or by hand. It’s free to download and will help you stay on track!
Be patient and disciplined during this time, giving thanks for all work and income. Ask God for the ability to stretch during the lean times and save during the rich ones.
Remember that your budget is meant to flex as your income and expenses change over time. Once you’ve followed your budget for some time, you’ll be able to identify the areas where you need to adjust.
One of the downsides of “gig work” is the lack of employer-provided benefits. This means it is solely up to you to plan and save for your future.
You’ll need to develop the habit of saving. Set up monthly automatic transfers and manually transfer excess in the high earning months. Establish an emergency fund with $1,000 to help you get out of debt, stay out of debt, and cover emergency expenses without a credit card.
Then work toward saving 3-6 months’ of your living expenses. Try to ultimately have 12 months’ of living expenses set aside in a savings account, separate from your $1,000 emergency savings fund. This is your safety net for lower income months to cover unexpected medical bills, home and vehicle repairs, and other surprise expenses.
If you want to make a big purchase, go on vacation, or start saving for college education, set separate savings goals. Again, your budget is going to be crucial in accomplishing this. Avoid relying on credit cards and accumulating interest charges.
And of course, start saving for retirement. This blog outlines many retirement savings options for freelancers and gig workers. I recommend you do some research, find the option that will serve you best, and get to work. Compound interest works in your favor, so the sooner you start saving, the more money you’ll have for retirement when the time comes.
The best example of a great budget on an inconsistent income is found in Genesis 41-47. God had warned Pharaoh through Joseph that 7 years of harvest were coming to the land of Egypt, followed by 7 years of famine. So Joseph advised Pharaoh to be diligent to save 20% in the years of plenty. This savings plan enabled the entire country of Egypt and surrounding countries to be fed during the severe famine.
If Pharaoh had not enabled Joseph to put a plan in place during the plentiful years, the years of famine would have wiped out entire nations. It may be difficult, but you can have a great budget on an inconsistent income!
God created you to work and cares just as much about how you make your money as He does how you spend it. So in the ups and downs of your work and planning, remember what Paul told the Philippians:
Rejoice in the Lord always; again I will say, rejoice. Let your reasonableness be known to everyone. The Lord is at hand; do not be anxious about anything, but in everything by prayer and supplication with thanksgiving let your requests be made known to God. And the peace of God, which surpasses all understanding, will guard your hearts and your minds in Christ Jesus.
(Philippians 4:4-7)
Don’t grow weary while creating a workable plan. It may take you 6-12 months to get on track, so be disciplined and exercise self-control. Depending on your current lifestyle, you may need to make adjustments so you can save when extra income comes in. By living according to God’s principles, you’ll be able to experience true peace.
Say no to what you want today so you have what you need tomorrow. Most importantly, trust God for His daily provision while applying His principles of faithful stewardship to your finances.
Originally published on the Christian Post, April 6, 2018
Dear Chuck,
I need help prioritizing how to use my tax refund. We are expecting to receive about $3,100 from our refund and want to use it wisely since we have a little over $23,000 of debt and are in desperate need of new tires for my car ($450). In what order should we use the tax refund money to do the following: put $1,000 into an emergency savings account, pay off credit card debt, pay off student debt, pay off the car loan, pay off a medical bill, or purchase new tires?
Overwhelmed with Debt
Dear Overwhelmed with Debt,
While I am sorry that you are feeling overwhelmed, the fact that you are getting a refund and want to spend it wisely is encouraging!
It would be helpful to have more information, especially about your income, assets, and details about each of these debts. Since I don’t, I’ll give you my priority list and a few suggestions based on what information you’ve included here.
Here are the reasons why I have chosen this allocation and some tips to get debt free.
This is the first priority, especially if you use your car to get to work. Your transportation and safety are of utmost importance. It is only $450 and should not be delayed.
The next priority is to get an emergency savings account in place so you can stop relying on your credit cards when you have unexpected expenses. The recommended starting amount is $1,000. Having available cash to cover unpleasant surprises will begin to break the cycle of debt. Here are 13 ways to get started saving.
I recommend that you use the balance of your income tax refund to pay off all remaining medical bills. This is a form of consumer debt that is not backed by any asset that can be sold or liquidated. It is important to keep your accounts current in order to receive service from your doctor or dentist as needed. Be sure to negotiate any reductions in the loan amount before paying it off in full.
Once you have your new tires, an emergency savings account, and have paid off medical bills, you will be much better off and should feel less overwhelmed. You can apply what you were paying towards medical debt to your remaining consumer debt. It is important to plan now to pay off the credit cards, student loans, and remaining car debt; otherwise, it will be easy to find yourself in this position again.
This is a simple method to pay off loans while experiencing the victory of disappearing debt. You can find an in-depth tutorial and understanding of how to use this method in our free video series, 5 Steps to Debt-Free Living.
If you only make minimum payments on your debt, while continuing to charge more on credit cards, the balance will continue to grow. Hopefully, this is not your case. But, if you are ever tempted to charge something, consider the long-term ramifications and walk away! Get a good friend to help you cut up your credit cards if needed!
You must be able to accurately track your spending to know exactly where your money is going. Then you can look for areas where you are overspending and where you can spend less to create margin for yourself. Realistic goals and a workable budget will quickly enable you to steward money wisely and eliminate your debt. You should consider adjusting your tax withholding so you can apply the money to debt this year instead of planning on a refund next year.
Recruit a wise, older couple to encourage you and hold you accountable. The benefit of Godly advisors is emphasized throughout Proverbs:
Listen to advice and accept instruction, that you may gain wisdom in the future. (Proverbs 19:20)
Finally, the sooner you pay off this debt, the sooner you will experience true financial freedom. With a united desire towards this end, you and your spouse can make lifestyle changes or set challenges for yourselves that will propel you forward. Working together, you can have fun simplifying and choosing to spend less so you never experience the negative side of Proverbs 22:7 again: The rich rules over the poor, and the borrower is the slave of the lender.
May you discover what excellent money managers you can be by encouraging one another and working toward mutual goals.
Call the Crown Helpline at 800-722-1976 if you need more encouragement or prayer support. Our friends at Christian Credit Counselors can help with the credit card debt restructuring as needed.
Originally published on the Christian Post, March 30, 2018
Dear Chuck,
Amazon seems to have taken over the world! Their dominating presence makes me a little nervous…but I still love my free 2-day shipping from Prime. Are there any alternatives out there that I should know about? I feel like I can save money shopping from Amazon and the free shipping is always a plus, but I want to be intentional about where I spend my money. What’s your advice?
Leary of Amazon
Dear Leary of Amazon,
Millions like you are experiencing the same “nervous” reaction to the controlling presence of Amazon in the online marketplace. I noticed recently that they have installed pick up lockers in the Whole Foods grocery store location where we occasionally shop. They are becoming integrated in an online and traditional brick and mortar strategy. Amazon Go is a concept in development now where stores do not have cashiers or check out counters.
You are wise to consider possible alternatives.
According to Invesp, “Global online retail sales are growing and is estimated to reach 8.8% of total retail spending in 2018 as compared to 7.4% in 2016.” People can shop from the comfort and convenience of their home and with just a few clicks they can have merchandise delivered wherever and whenever they desire.
Founded in 1994, Amazon has skyrocketed to the position of most popular online retailer. It offers a broad range of merchandise from its warehouses and third-party sellers. The company has a subscribe-and-save option that permits customers to automatically reorder products, get free shipping and discounts. And, the Echo or Dash makes ordering even easier. The Prime membership provides free shipping and countless other perks.
While Amazon is ever increasing in popularity, there are other online retailers and millions of the more traditional alternatives to shopping, many of which are improving their online options. (Keep in mind, these are not endorsements of these companies, but a menu of a few options for you to consider.)
Walmart may have the potential of challenging Amazon because of the company’s emphasis in omni-channel retailing. This is a strategy that allows “customers to peruse, purchase, receive, and return merchandise through any number of different channels from online to mobile apps to delivery services to physical stores.”
Walmart has over 5,000 stores nationwide and Amazon has fewer than 500 Whole Foods locations for pickup, delivery, and returns to be accomplished. But, catching up from the store-side to e-commerce side has its challenges.
Business Insider reported that Sam’s Club, a subsidiary of Walmart, is offering free shipping on most of the items it sells online. This is available to those with a Sam’s Club Plus membership of $100 and hopes to eventually offer one- or two-day delivery.
Care and caution when shopping or spending are important aspects of becoming wise stewards. Consider the lessons from the famed Proverbs 31 woman: She considers a field and buys it; From her earnings she plants a vineyard. (Proverbs 31:16) The word considers means there was careful thought that went into her spending process. Further, she had profits/earnings to make an investment in her land to ensure it would produce future profits.
Shopping has become so easy and appealing that people are buying far more than they need. We often spend without caution. Self-control is ignored and instant gratification fueled by fast shipping frenzy. Perhaps it’s time we step back and take a hard look at our desires. What do we really need? Contentment is not acquired through more stuff!
We can help our local economy by intentionally supporting our local businesses. Many traditional retailers offer great alternatives to online shopping. Purchasing from reputable companies with values similar to ours is worth paying a little more and being a bit less convenient because we give our money to those we trust. Hobby Lobby is just one example of a company that is intentional about honoring God in their business.
While it is convenient to order online and have products easily delivered to our doorstep, it is also a great benefit to walk into a store and pick up a product to learn more about it. Companies that take the risk to have the inventory in a nice showroom and available for you to take home immediately are making purchases very convenient for all of us as well. Imagine that you need tires, a gallon of milk, a fuse to start your car, a tool to fix a leak right now – suddenly the value of those local retailers comes into focus. But they cannot continue to provide those convenient services if we stop considering them as a viable option to Amazon.
We all want to get the best product at the best prices, but that is not always an option for those that provide us the products in the most convenient manner. Paying a little more to the local retailer may be far better for you and your community in the long run.
Thanks for a good question. It is a tension many of us are also wrestling with and trying to find the right balance. There are many opportunities for Christians to make different financial decisions because of our commitment to live by biblical principles. If you want to learn more about what the Bible says about every aspect of your finances, join the online MoneyLife Personal Finance Study. You’ll get access to 10 life lessons and an online community of others pursuing financial freedom.
Originally published on the Christian Post, March 23, 2018
Dear Chuck,
I’m in my early twenties and finances are a topic of stress in my life and among my peers. One of my friends, who is about my age, just paid off his mortgage. How is that even possible? Others I know rely solely on credit cards and are in thousands of dollars of debt. I feel like I’m stuck between two ideologies – people who only spend their money on sensible things (and maybe have no fun) and people who spend it frivolously. What does the Bible say I’m supposed to do? What should I be focusing on?
Stuck Millennial
Dear Stuck Millennial,
You have outlined a very relevant “tension” for people your age – some are doing extremely well with their finances. Others are still financially illiterate. But the fact that you have taken the time to ask this question is a good sign for your financial future. I have a great story for you and some biblical advice.
Last week I talked with a young man, a Millennial such as yourself, who related how he and his wife had already paid off their house. As I explored more of his story, I learned that he has been married fewer than six years, has an emergency savings account, regularly invests for the future, and has completely paid off his house. And the kicker… they accomplished all of this on a modest income. He earns about $49,000/year and she makes about $7,000/year in a side business.
He explained that when they got married, they decided to live like they were poor. They got on the same page about their financial goals, budget, and spending habits, and worked together to reach their goals. He said it was pretty simple – really, “just a mindset change”.
This principle – to “live like you’re poor” – is the key to the questions you’re asking. I’ll outline spiritual truths and practical steps to help you get there.
Living below our means is a mindset totally contrary to what the world promotes. It doesn’t come naturally because our sinful selves want to keep up with everybody else around us. But, it is possible!
Paul said, …I have learned in whatever situation I am to be content. I know how to be brought low, and I know how to abound. In any and every circumstance, I have learned the secret of facing plenty and hunger, abundance and need. I can do all things through him who strengthens me. (Philippians 4:11-13)
Pursuing contentment means pursuing God’s will for your life. So when you’re making your budget, concern yourself less with following a certain guideline or budgeting to “Keep Up with the Joneses” (they’re probably in debt anyway).
Instead, focus your time, energy, and money on God’s Kingdom and your budget will fall into place. Now, it will take a faithful heart and disciplined hands to do this, but when your priorities are in order, it makes it much easier. Crown’s founder, Larry Burkett, once said, “money is the greatest outward expression of our inner spiritual condition.” Keep that in mind with each purchase you make.
If we choose to obey what Jesus taught in Matthew 6:33, …seek first the kingdom of God… then we consciously purchase only those things that provide for our needs and strengthen us physically, mentally, and spiritually for our mission. Does that mean we can’t have fun? Absolutely not! It means we avoid the stress of a debt-laden lifestyle as we attempt to live God’s way.
The amount of money you live off of will vary depending on your job, marital, and geographical status. But as general rule, you should always live beneath your income. The friend I mentioned before and his wife lived much beneath their means.
Here are a few of the ways he shared they were able to accomplish these financial goals:
Choose your friends carefully. If you’re always hanging out with people eager to eat out at the nicest restaurants, buy the nicest things, and drive the nicest cars, it will be difficult to resist the temptations to spend the same way. Spend time with like-minded people who will encourage you on your financial journey.
Have a specific goal in mind. We knew we wanted to pay off all debt by a certain date, so we made it a goal. Then if we had a big purchase coming up, we would save intentionally (on top of our other savings) for that purchase. We planned vacations during this process as well, but paid cash for it all.
Organizations like Christian Credit Counselors can help you get out of overwhelming credit card debt. They have an incredible team of professional counselors who can help you put together a payoff plan, negotiate with your creditors, lower your interest rates, and consolidate your payments.
Stay on the same page. If you and your spouse are headed in two directions (even slightly different directions), you won’t reach your goal. Get on the same page and ensure you’re both excited and motivated to achieve together.
Stay in your own financial lane. Resist the urge to have expensive taste or always need to have the newest and best. Browse used furniture, decor, and appliances on Craigslist or Facebook Marketplace.
Have a generous heart. In order to keep your priorities in order, always put giving first. All you have belongs to God, so don’t have a greedy heart or resist giving. It usually ends up blessing you more in the long run anyway!
Direct deposit savings. Set up an automatic transfer from your paycheck to your savings account. Label your savings as “Do Not Touch” and only budget what is left after you have tithed and saved. You can essentially trick yourself into being poor by hiding your extra money in savings!
Make it visual. We printed off our amortization table for our mortgage from the bank. Seeing our timeline “fast forward” with each payment we made toward our principal was extremely motivating.
Invest your time instead of your money. Proverbs 10:4 says, Lazy hands make for poverty, but diligent hands bring wealth. Keep yourself busy serving others, earning extra income, and taking care of the things you do own. It will keep you from wanting to spend!
Skip the little things. It may sound cliche, but skipping your morning Starbucks run and making coffee at home will save you a lot of money. My wife avoided Target, especially the dollar section. Don’t go shopping without a list, and don’t be tempted by ads on your Instagram or Facebook. Stay off social media and resist the comparison trap altogether!
Lastly, have a grateful heart. Thank God daily for all He’s done, and ask Him to teach you to be content with a little, so you can give much to Him and His work!
I hope these principles and practical steps help you to forge a financial plan full of contentment and gratitude. As difficult as it is, don’t compare yourself to others. Pursue God’s will for your life and finances, and be faithful to discern what it is. By keeping an eternal mindset, do the work here on earth to one day hear, “well done, good and faithful servant.”
Originally published on the Christian Post, March 16, 2018
Dear Chuck,
The stock market has been in the news a LOT recently. I don’t know much about it, but seeing all the headlines has made me more interested and I’ve been thinking a lot about starting to invest. Is investing a good idea for Christians? Could you help me know what the first steps to take are? Like a beginner’s course?
Baby Step Investor
Dear Baby Step Investor,
The U.S. stock market has grabbed everyone’s attention since volatility began to increase after a full year of uninterrupted month over month growth in 2017. With so many people having some stake in the market, it is no wonder that it has been making the financial headlines lately.
Recent surveys indicate that about 45% of Americans own a mutual fund, 52% say they have investments in stocks, and about 32% invest via a 401(k) through their employer. The average balance for all Americans that have money socked away in a 401(k) is $96,288, though that number varies greatly by age group.
Investing is a great idea for Christians with the right motive and the right approach.
It is a wrong motive to invest simply for the sake of just making money. Greed or a “get rich quick” motive is condemned in Scripture. Proverbs 21:5 teaches us that, “Steady plodding brings prosperity; hasty speculation brings poverty.” The recent bitcoin frenzy is an example of hasty speculation.
Making money is the byproduct of doing what God has called you to do. We are to make financial decisions as a manager (steward) of His property seeking to multiply what He provides to serve Him more fully.
A legitimate purpose of any investment program is to help your family. This may include investing to provide funds for your children’s education, to provide a family inheritance, to fund retirement, to provide income in the event of job loss or mission work. Another reason is to use the funds to give charitably.
The best weapon to protect yourself against greed and pride is to have a specific plan for giving to God’s work. This requires an eternal perspective. Once a commitment has been made to live a generous lifestyle, regardless of the available income, greed and self-indulgence is drastically reduced.
Next, determine how you want to invest. Some prefer the DIY method which can save you broker fees. Or you may want to pay a professional to manage the process for you. Rusty Leonard at Stewardship Partners has a video on Biblical investing along with helpful information. And the National Christian Foundation, NCF, helps investors with charitable giving.
Education is key to investing. Learn all you can so you make knowledgeable, prudent decisions.
Familiarize yourself with basic terminology. Here are 25 common terms, the Forbes Financial Glossary, and an explanation of 401K vocabulary.
Don’t invest simply based on the word of somebody else. It must be something you understand, so do your research first before investing one dollar.
Be careful not to allow your emotions to control your investing. There will be swings in price, sometimes meteoric rises and drastic falls. Stick to your long-term goals and panic can be limited if not completely avoided. Determine ahead of time what you’re willing to invest, at what price, and at what point you will sell if it drops. This will help limit your risk and enable you to make a well thought out trade.
For most people, investing in stocks means choosing between these two investment types:
Stock (or equity) mutual funds or exchange-traded funds (ETF’s). These are small pieces of different stocks sold together in a single transaction. This allows you to build a diversified portfolio. A Standard & Poor’s 500 fund offers stock of those companies, so your investment grants ownership in small pieces of each one. You can build diversity by investing in several different funds which lessens your risk. They may not increase as quickly as stocks but may also not fall as dramatically either. These are good for long-term goals like retirement or college.
Individual stocks. You can buy a share or a few shares of specific companies as a way to begin in stock-trading. Research and diversification are required more with this route. If you invest in a variety of individual stocks, a few good picks can pay off well. But, that doesn’t always happen. If you are young and can afford loss, this is an acceptable way to go. But, if you’re investing for retirement, your portfolio should also include mutual funds and investments outside the market to reduce your risk.
A 401(k) participation through work is a great way to invest in stocks or mutual funds. Max out this option if you can. If you are self-employed, there are ways to save for retirement as well.
Software can now manage your finances. Acorns.com, Stashinvest.com, Weathsimple.com are a few robo-advisors that make investing easy and low cost. (Please note: I do not endorse any of these services, companies or strategies. I am providing this information for educational purposes only.) This blog outlines some of the pros and cons of apps like this.
Avoid paying too much in fees or commissions. Know the cost on transaction fees, because these can add up if you buy and sell frequently.
Keep it simple. A simple portfolio spread across several different asset classes of mutual funds, stocks, cash, real estate, etc. Values will fluctuate in the short run, but hopefully produce good results long-term.
Establish an automatic investment plan and review regularly. You may need to periodically adjust your automatic investments to keep your portfolio in balance.
Pay attention. Know well the condition of your flocks, and give attention to your herds, for riches do not last forever; and does a crown endure to all generations? (Proverbs 27:23-24)
Start small. Learn all you can and make bigger investments as your knowledge increases. Baby steps are a great way to think about investing. First you crawl, then you walk, and then you run. Before you think about investing, make sure you’ve reached these financial goals first:
Lastly, don’t worry too much about all the headlines. As Warren Buffett famously says, “Only buy something (a company stock) that you’d be perfectly happy to hold if the market shut down for 10 years.”
Originally published on the Christian Post, March 9, 2018
Dear Chuck,
I recently read an article from Forbes that staying at a job for more than 2 years means you’ll get paid 50% less. I come from a background where my parents and grandparents stayed with the same company their entire careers, so changing jobs every 2 years to keep a better pay sounds strange to me. But I don’t want to get stuck in a job that isn’t going to be financially advantageous. What would you advise I do?”
Worried About My Wages
Dear Worried,
This is a relevant question. Since we both know that we work for more reasons than just our wages, let’s examine all aspects of the “job hopping for hiring wages” argument.
Changing jobs every few years used to look bad on a resume. It gave the impression you could not commit, get along with colleagues, or hold down a job. But, things have changed.
Employees are learning that in today’s world they must manage their own careers. Millennials, as a whole, are no longer climbing the corporate ladder. They change jobs every few years, knowing it forces them to develop new skills, adapt quickly, and broaden their network. They seek jobs that meet their needs and life goals, where they can learn, grow, advance, and make more money.
A recent study from FutureWorkplace reported that 91% of millennials expect to stay in a job for fewer than three years. With so many recent graduates disinterested in conventional career paths, a life spent at 20 jobs is possible!
Gallup conducted a study in which they called millennials the “job-hopping generation”. They found that 21% of those surveyed had changed positions in the past year – three times the rate of non-millennials. Their top five factors in making a change included:
According to Legal Technology Solutions (LTS) figures, a job or career change in a healthy economic market can offer an average 8-10% wage increase. And, 20% is not out of the question. Companies competing for skilled employees are not afraid to pay more if they can hire the best talent. They find that those who have held multiple jobs can be top performers, bring knowledge of competitors, learn fast, take risks, and build contacts quickly. Plus, their experience gives them valuable insight into the future workplace.
It is worth noting that similar jobs in different industries can demand different wages. Job shoppers need to research opportunities to determine if a new industry is worth the change. Companies seeking your skill set may offer more money, flexibility, or benefits to recruit you to their team.
With any job change comes a certain amount of stress. If you love where you are, a good offer from another company puts you in the unique position to negotiate a raise from your current employer. In fact, it’s courteous to give him or her the opportunity to counter-offer to keep you on staff. It’s possible you’ll get what the other company offered without changing jobs. If not, you’ll have to decide if the extra income is worth relocating and leaving a good situation.
“If you’re constantly starting over, you won’t be climbing upward nearly as fast,” says Valerie Streif, senior career advisor with theMentat.com. “Getting stuck in a similar position across different companies can get old, and then you’ll constantly have issues with finding satisfaction in your career.” She recommends that employees look for opportunities within their company. “Make slight shifts to your situation, rather than always trying to create a new situation.”
Employers know the value of employee retention. Many avoid hiring people who give no indication they plan to settle down soon. A frequent job hopper could lose out to applicants who appear more willing to stay put. Employers must create an appealing environment where they invest in their people and motivate achievement. When employees are valued and rewarded, they will flourish and give their best.
The long-term consequences of frequent job change are yet to be seen. Change can be stressful and may not be worth the additional pay and perks. Those who are constantly looking for something better, may lack contentment and have a hard time settling down anywhere. Employees need to bathe their career decisions in prayer and seek wise counsel.
So, whether you settle down where you are or embrace a lifestyle of frequently changing jobs, remember the bigger picture: “Whatever you do, work heartily, as for the Lord and not for men.” Colossians 3:23
I would also recommend you take the Career Direct assessment to help you understand your unique design and purpose. The assessment will take you about an hour and then you can schedule a session with a professional consultant to go over your results. It’s an empowering process that will help you have more confidence in your God-given design and career.
Originally published on the Christian Post, March 2, 2018
Dear Chuck,
I recently read an article from Forbes that staying at a job for more than 2 years means you’ll get paid 50% less. I come from a background where my parents and grandparents stayed with the same company their entire careers, so changing jobs every 2 years to keep a better pay sounds strange to me. But I don’t want to get stuck in a job that isn’t going to be financially advantageous. What would you advise I do?”
Worried About My Wages
Dear Worried,
This is a relevant question. Since we both know that we work for more reasons than just our wages, let’s examine all aspects of the “job hopping for hiring wages” argument.
Changing jobs every few years used to look bad on a resume. It gave the impression you could not commit, get along with colleagues, or hold down a job. But, things have changed.
Employees are learning that in today’s world they must manage their own careers. Millennials, as a whole, are no longer climbing the corporate ladder. They change jobs every few years, knowing it forces them to develop new skills, adapt quickly, and broaden their network. They seek jobs that meet their needs and life goals, where they can learn, grow, advance, and make more money.
A recent study from FutureWorkplace reported that 91% of millennials expect to stay in a job for fewer than three years. With so many recent graduates disinterested in conventional career paths, a life spent at 20 jobs is possible!
Gallup conducted a study in which they called millennials the “job-hopping generation”. They found that 21% of those surveyed had changed positions in the past year – three times the rate of non-millennials. Their top five factors in making a change included:
According to Legal Technology Solutions (LTS) figures, a job or career change in a healthy economic market can offer an average 8-10% wage increase. And, 20% is not out of the question. Companies competing for skilled employees are not afraid to pay more if they can hire the best talent. They find that those who have held multiple jobs can be top performers, bring knowledge of competitors, learn fast, take risks, and build contacts quickly. Plus, their experience gives them valuable insight into the future workplace.
It is worth noting that similar jobs in different industries can demand different wages. Job shoppers need to research opportunities to determine if a new industry is worth the change. Companies seeking your skill set may offer more money, flexibility, or benefits to recruit you to their team.
With any job change comes a certain amount of stress. If you love where you are, a good offer from another company puts you in the unique position to negotiate a raise from your current employer. In fact, it’s courteous to give him or her the opportunity to counter-offer to keep you on staff. It’s possible you’ll get what the other company offered without changing jobs. If not, you’ll have to decide if the extra income is worth relocating and leaving a good situation.
“If you’re constantly starting over, you won’t be climbing upward nearly as fast,” says Valerie Streif, senior career advisor with theMentat.com. “Getting stuck in a similar position across different companies can get old, and then you’ll constantly have issues with finding satisfaction in your career.” She recommends that employees look for opportunities within their company. “Make slight shifts to your situation, rather than always trying to create a new situation.”
Employers know the value of employee retention. Many avoid hiring people who give no indication they plan to settle down soon. A frequent job hopper could lose out to applicants who appear more willing to stay put. Employers must create an appealing environment where they invest in their people and motivate achievement. When employees are valued and rewarded, they will flourish and give their best.
The long-term consequences of frequent job change are yet to be seen. Change can be stressful and may not be worth the additional pay and perks. Those who are constantly looking for something better, may lack contentment and have a hard time settling down anywhere. Employees need to bathe their career decisions in prayer and seek wise counsel.
So, whether you settle down where you are or embrace a lifestyle of frequently changing jobs, remember the bigger picture: “Whatever you do, work heartily, as for the Lord and not for men.” Colossians 3:23
I would also recommend you take the Career Direct assessment to help you understand your unique design and purpose. The assessment will take you about an hour and then you can schedule a session with a professional consultant to go over your results. It’s an empowering process that will help you have more confidence in your God-given design and career.
Originally published on the Christian Post, March 2, 2018
Dear Chuck,
I know there is a new tax bill, but I don’t know how it will affect filing this year. For someone who isn’t very familiar with all the ins and outs of the tax code (who is?), and just wants to be honest and receive the right deductions, it’s a little overwhelming to try and understand. Can you provide some insight? Anything I need to watch out for?
Rendering to Caesar
Dear Rendering to Caesar,
When The Tax Cuts and Jobs Act of 2017 was signed into law back in December, millions started asking and wondering how it would personally affect them. Only a couple changes might impact the 2017 filings you make this year. But, several changes will definitely affect future filings. I will only address those changes that affect personal income taxes.
The good news is that you have two extra days to file this year because they’re not due until Tuesday, April 17th and for the vast majority of taxpayers, we will owe less in 2018.
I don’t know anybody that delights in paying taxes. But, Paul’s advice to the Romans can help us with our attitude. Let every person be subject to the governing authorities. For there is no authority except from God, and those that exist have been instituted by God. Pay to all what is owed to them: taxes to whom taxes are owed, revenue to whom revenue is owed, respect to whom respect is owed, honor to whom honor is owed. (Romans 13:1,7)
So not only is it our duty before God to pay taxes but we should also honor those that use our taxes to accomplish important functions for the common good like military defense, roads, education and medical care.
Medical expenses that total more than 7.5% of adjusted gross income (AGI) can be deducted for 2 years beginning January 1, 2017. For example, if your AGI is $50,000 you can deduct any medical expenses over $3,750 ($50,000 X 7.5%) if you itemize your deductions. This is retroactive, so you will see this change on your 2017 and 2018 returns. After this time, the 10% threshold returns.
The tax break for personal casualty losses is retroactive back to 2016 and was expanded to include losses in any federally declared disaster area. The primary place of residence must have been located in a 2016 disaster area and sustained a loss from a federally declared disaster. Typically claimed as an itemized deduction, the new law allows taxpayers to claim the loss if they claim the standard deduction with limitations.
The brackets remain the same but some tax rates drop and income thresholds have changed.
Standard deduction has nearly doubled: Singles $12,000. Joint filers $24,000.
Personal Exemption for you, your spouse and dependents has been eliminated.
State and local tax deduction, SALT, is capped at $10,000 for single or married itemizers. If married and filing separately, it drops to $5,000.
Child tax credit is now $2,000 for those under 17 and available in full for single parents earning up to $200,000 or married couples who earn up to $400,000. The amount refundable jumps from $1,100 to $1,400.
New temporary tax credit of $500 for non-child dependents: children over 17, elderly parents or adult children.
The individual mandate, that penalizes those without health care, was eliminated and goes into effect in 2019, affecting 2020 returns. However, taxpayers without coverage must claim a waiver or exemption (usually based on hardship) or face a penalty called the shared individual responsibility payment.
For the 2017 tax year, the penalty, payable in 2018, is equal to 2.5% of your adjusted gross income or $695 per adult and $347.50 per child, up to a maximum of $2,085, whichever is higher. According to the IRS, electronically filed tax returns will not be accepted “until the taxpayer indicates whether they had coverage, had an exemption or will make a shared responsibility payment.”
Mortgage interest deduction remains unchanged for current homeowners, but has been lowered on new mortgages for 1st or 2nd homes to the first $750,000 of their mortgage debt between December 31, 2017 and December 31, 2025. Interest deductions for home-equity loans are not accepted.
Those who file divorce or separation agreements after December 31, 2018 will no longer be able to deduct alimony payments and recipients will no longer treat alimony received as taxable income.
Only official national disasters qualify for deductions through 2025.
Deductions for bicycle commuting has been eliminated, as have tax preparation, investment fees, and unreimbursed job expenses. In addition, moving expenses for work are no longer deductible with possible exceptions for military members.
Money exempt from the estate tax has been doubled from the current $5.49 million for individuals and $10.98 million for married couples. Few people will be affected.
The annual gift exclusion increased from $14,000 to $15,000 per person per donor beginning in 2018.
It’s all God’s. He knows how hard we work to earn each dollar and how difficult this season is for many Americans. It is an opportunity to depend on Him and to prepare our taxes with a clear conscience. Proverbs 10:9 says, Whoever walks in integrity walks securely, but he who makes his ways crooked will be found out.
Remember how the scribes and chief priests desired to entrap Jesus. They posed a question for him that’s applicable to us. ‘Is it lawful for us to give tribute to Caesar, or not?’ But he perceived their craftiness, and said to them, ‘Show me a denarius. Whose likeness and inscription does it have?’ They said, ‘Caesar’s.’ He said to them, ‘Then render to Caesar the things that are Caesar’s, and to God the things that are God’s.’ (Luke 20:22-25)
Go and do likewise.
If you want to learn more about what the Bible says about all aspects of your finances, enroll in Crown’s online MoneyLife Personal Finance Study. Seven weeks could change your financial future!
Originally published on the Christian Post, February 16, 2018
