A Framework for God-Honoring Financial Success
“For we are his workmanship, created in Christ Jesus for good works, which God prepared beforehand, that we should walk in them.” – Ephesians 2:10
It’s easy to make managing money more complicated than it needs to be. That’s because money isn’t just an objective “means of exchange” as the dictionary defines it. Money is wrapped up in our emotions – our hopes, dreams, and fears. This opens the door for the misuse of money which can be strongly influenced by the many messages of our consumer culture. Paul warns us that “…those who desire to be rich fall into temptation, into a snare, into many senseless and harmful desires that plunge people into ruin and destruction.” – 1 Timothy 6:9
Knowing our purpose guides our priorities
To avoid this snare, it’s helpful to get back to the basics by remembering that there are only five things we can do with money:
- Spend it
- Use it for debt payments
- Save it
- Invest it
- Give it away
Very often, when money gets messy for someone, it’s because they’ve gotten these priorities out of whack.
When culture calls the shots
The order above is the one advocated by our consumer culture. Whenever money comes into our lives, our cultural conditioning leads us to think first about what we can spend it on – what to do for fun, how much clothing we can buy, where we can go on vacation.
When spending comes first, debt always seems to come along for the ride. There’s a financed vehicle in the driveway, a balance on a credit card or two.
If there’s any money left over, we might save and invest some. And if anything is left over after all that, we might give some away.
This order explains a lot about why so many people have so much debt, so little savings, and more than their share of stress.
A better way to prioritize
Here’s the order that works much better:
- Give some
- Save some
- Invest some
- Then see how much you can afford to spend on housing, transportation, and all the rest.
- Have no debt except a reasonable mortgage
Hitting the money reset button
This order is much easier to teach to young people who haven’t started getting their first full-time salary yet. But what if you’re already out there and your money’s all messed up because you’ve been following our culture’s plan?
Use a Cash Flow Plan to hit the reset button. Fill in the “Now” columns to see where you’re at. And use my Recommended Cash Flow Guidelines (on the same page as my Cash Flow Plan) to fill in the “Goal” columns with an ideal plan. Then start moving toward the ideal. It probably won’t happen overnight. There may be some credit card debt to ditch and a car payment to lose. It may take some rethinking about how you spend on groceries, clothing, entertainment, and everything else.
But the framework of give, save, invest, spend, and be cautious with debt is the simplest and most effective way of doing the whole money thing I’ve ever found.
Move toward it and you’ll move toward a financial life that works amazingly well.
“Listen to counsel and receive instruction so that you may be wise later in life.” – Proverbs 19:20