The Budget... It's an Essential

Establishing a budget is an essential as you travel the road to financial freedom.  At the end of the month do you want your money to tell you where it went or do you want to tell your money where to go?  Dictionary.com defines the word budget as “an estimate, often itemized, of expected income and expense for a given period in the future.”  An accounting textbook defines budget as “a comprehensive financial plan setting forth the expected route for achieving the financial and operational goals of an organization.”  John Maxwell defines a budget as “Telling your money where to go instead of wondering where it went.”  In this blog we are going to define the word budget as “an itemized plan of how you are going to kick the enemy in the teeth in order to get out of financial bondage and live a God-honoring lifestyle that will not only bring financial freedom but financial peace.”

Keep in mind that your budget is not chiseled in stone.  You want to keep your budget flexible and know that it can be changed.  Your money is not the boss of you.  You are the boss of your money.

There are four necessities that you want to use as you build your budget.  These four areas are not negotiable and they are the first things that you pay every month.  They are important because without these 4 areas, you will not be able to handle the other areas of your budget.  The first necessity is shelter.  This area includes everything that is spent on housing, including your mortgage or rent, utilities and insurance.  You must have a place to live.  The second necessity is transportation.  You have a job so that you can pay your bills; therefore, you must have a way to get to your job.  This area can include all costs associated with owning and maintaining a car such as car payments, gas, oil changes and insurance or the expenditures for alternative forms of transportation such as bus fare.  The third necessity is food.  In order for you to effectively perform in your job and make wise decisions, you must provide your body and your family with nutrition.  The fourth necessity is clothing.  You need the necessary and appropriate clothing for your job and for general living.  Keep in mind that as you develop these areas of your budget, you do not have to be extravagant.  For example, in the housing section you may include cable as a utility but cable may be an expenditure that you can eliminate in order to develop other areas of your budget.  Do your best to develop these areas fully and wisely.

One final note about developing your budget…  If you know anything about dieting you have probably heard the advise to not eliminate the one favorite food due to the fact that you are more likely to fall away from your diet if you don’t have something to enjoy.  The same holds true for your budget.  Do not eliminate the one thing that will hold you to your budget.  This could be keeping cable or a monthly clothing option.  Please don’t risk blowing your budget and becoming hopeless because of the one thing that will keep you going.

Go for it and develop your budget for this month or the next month!  You can do it and you will be so glad that you did.  Please send any comments if you have questions or need assistance.

The 4 Essentials While Traveling the Road to Financial Freedom

We believe there are four essentials that you need to establish as you begin to travel the road to financial freedom.  The four essentials are:  (1)  establish financial objectives, (2)  develop a budget, (3)  save for an emergency fund, and (4) track your spending.

The first essential is to consider your financial objectives.  Financial objectives are your target, what you are aiming for.  They can be broad and long term such as having no mortgage in ten years or establishing college savings for your new baby.  Your financial objectives can be specific and short term such as paying off a credit card in six months.  Your financial objectives can be anything  that charts your course to financial freedom.  They set your path and give you direction.  Without objectives, you have nowhere to go.  Prayerfully consider what they are and approach them with knowledge about your current situation.  Our personal financial objectives include getting out of debt in 3 years, completing our Imagine 2 commitment with strength, tithe every year off of our gross income, save as much as we can for our daughter's college education, and save for a 50% downpayment on a new house.

What are some of your financial objectives?

What is Financial Freedom?

Why do we want to live in financial freedom?  It is a way of life that God always intended for us!  He did not intend for us to be slaves to our money but He knew that money would hinder us.  That is why Jesus talked about money so much.  Money and finances has the second-most scriptures in the Bible.  The topic that has the most – salvation.  Achieving financial freedom can impact and unleash so much in your life and in the spiritual world.  For you, it will reduce the amount of anxiety in your life and provide you with greater freedom to love.  In the spiritual world, more people achieving financial freedom can result in more people giving their lives to Jesus.

So, what is financial freedom?  In order to get to the definition of financial freedom, let’s first look at financial bondage.  In Matthew 6:24, Jesus states, “No one can serve two masters.  Either he will hate the one and love the other, or he will be devoted to one and despise the other.  You cannot serve both God and Money.”  Jesus gets pretty specific in that last statement.  We cannot serve two masters; we can not serve God AND money.  Also, God will not share His throne and He will allow us to pick money over Him.

Financial bondage can manifest in a variety of ways.  You may experience it as living paycheck to paycheck, accumulation of debt, or having an “I must have it now!” mentality.  An important step to take is identifying what underlying sin keeps you in financial bondage.  Examples are entitlement (I deserve…), pride (I can take care of myself…), comparison (I love what that person has…), discontentment (To feel good in life I must have Jesus and…), faithlessness (I know Jesus will provide but I need to know that now…), envy, addiction, and the list could go on.  Prayerfully consider what underlying sin that you may be experiencing that is keeping you in financial bondage.  If God prompts you, confess that sin to God and ask for forgiveness, confess it to a trusted adult, and begin the recovery process.

Now that we have looked at financial bondage, let’s begin to define financial freedom.  I believe we can experience financial freedom as the people of the first church experienced it.  In Acts 4:32 we read, “All the believers were one in heart and mind.  No one claimed that any of his possessions was his own, but they shared everything they had.”  They lived as though what they owned was not their own!  They understood that everything they had was entrusted to them by God.  God created everything and owns everything.  We are merely trustees of what God owns.  Trustees have no rights, only responsibilities.  The primary responsibility is to take care of what has been entrusted to him or her.  The point is that financial freedom has nothing to do with how much money you make or how much debt you have.  It is about living with the understanding that God entrusts His limitless resources to us.  As each of us experience financial freedom, God’s kingdom will be resourced with more and more allowing us to reach more and more people. 

In order to get from bondage to freedom you must go through transformation.  You must submit to God’s transformational work in your life.  Romans 12:2 says, “Do not conform any longer to the pattern of this world, but be transformed by the renewing of your mind.  Then you will be able to test and approve what God’s will is – his good, pleasing and perfect will.”  You will receive lots of information, but the information is only good if you allow transformation to happen.  We must break away from this world and begin pursuing a God-honoring lifestyle.  We must become weird… not normal… an alien.  In John 15 Jesus tells His disciples that they are not of this world.  As followers of Christ, we truly are aliens of this world.  Do not conform to this world’s standards, but to a life that is God-honoring and of freedom.

~Alesha

It's Essential: Give Back

I know, it sounds odd doesn’t it? It goes against everything our society teaches. It doesn’t even make sense mathematically. Still, the truth is, you aren’t going to make any money until you give some of it away.

“Since you excel in so many ways…excel also in this gracious act of giving.” 2 Corinthians 8:7 (NLT)

Let’s start at the beginning. Some time ago, you were nothing. And then we were born. The Bible says you were crafted in your mother’s womb, and God knew you there. He knows the number of hairs on your head, and he gives us each certain gifts and abilities. Your abilities are to help others, and to help yourself. With them you’ll earn a living. He has given this to you. You may have heard that God asks for some of your earnings back. That’s not exactly true. He isn’t asking. He’s telling you.

I often tell my daughter to do things she doesn’t want to do. She doesn’t see the benefit to her, it interferes with what she wants to do in that moment, or it is just no fun whatsoever. But if you’re a parent like me, you know that we often tell our kids to do things for “their own good”. We’ve been there before. We see a bigger picture than our kids can. It is the same with God and us, only we’re the children.

Do not be anxious about anything, but in every situation, by prayer and petition, with thanksgiving, present your requests to God. Philippians 4:6 (NIV)

What God wants of us, through the act of giving, is to establish a lifestyle of generosity. It’s hard to be anxious about anything if you realize it isn’t yours to begin with. Are you free of anxiety when it comes to your finances? Freedom from anxiety is characterized by three inner attitudes.  What we have we received as a gift. What we have is to be cared for by God. What we have is available to others.

If you really want to be free financially, start with tithing. Tithing is ten percent of your income. Less than that is not tithing, it is, quite frankly, disobedience to the God who made you and gives you everything you have. Second, develop a habit of giving things away. To put it simply, de-accumulate.  If you are becoming attached to some possession, consider giving it to someone who needs it. What I’m referring to here is an addiction. Learn to tell the difference between a real or psychological need and an addiction.

He is the potter and you are the clay, to be crafted and molded into the person he has designed. Being molded hurts. It’s painful. Sometimes it takes a long time. But everything beautiful and worth having has gone through this shaping process. Be willing, it will go faster and will probably be less painful.

~Kevin

Anchors Aren't All Bad

Sometimes when we’re counseling people we hear phrases like, “I don’t know where that will come from”, and “we don’t make enough to match our budget.” In such cases we have to back up and look at the priorities outlined in the budget.

 

A priority is something that is given special attention, or something that comes first. It’s important to know what the top priorities are in your budget before you ever sit down to work on it. Make sure you have some form of shelter – a house, an apartment, or other living arrangements. Make sure you have food to eat. Make sure you have transportation to and from work or school. And make sure you have adequate clothing for your work and/or school. Dave Ramsey calls these priorities the “four walls”.

 

These are constant truths in your budget. You have to make sure that you are covering these things all the time, every month. Perhaps it doesn’t require explaining, but just to be sure, your job is your source of income, so you need to make sure you can get there – transportation – every day in order to earn that income. A budget without any income is not a budget, it’s a wish list. You need shelter to keep from getting sick so you can go to work. Also, you’re not going to do a very good job if you spend much of your day wondering where you’re going to sleep that night. You need clothes for that job, unless you work in a field that doesn’t require clothing. (Seriously, if this is you, please contact my friends at http://www.be-loved.cc/ and get help. You are worth so much more than this.)

 

Once you get these things down, then what? There are four other priorities we believe you need to consider:

• Give back
• Saving
• Get out of debt
• Do it now

These serve as anchors in your financial life, providing stability so that when the storms of life come and the waves crash into you, you won’t be crushed. Over the next couple of weeks we’ll cover each one in more detail.

~Kevin

Defining Financial Freedom

Kevin and I know that God has called us to lead more people into financial freedom.  The objective of this blog is to provide stories, resources, and information for more people to begin to experience financial freedom.  But what is financial freedom?

Some people may define financial freedom as no longer being in debt.  Others may define financial freedom as earning a certain income.  Still others may define financial freedom as no longer living paycheck to paycheck.  All of these are great indications that you desire to live in financial freedom and will provide a more personal definition of what financial freedom means to you.  For our purposes here, we're going to use scripture to help us define financial freedom.

We were not designed to live in financial bondage.  God did not place us on this earth and bless us with giftings and talents to work hard in order to be selfish with our money.  He made us stewards of His unlimited resources and entrusts us with all that we have.  However, He knew that we would fall to sin and find ourselves in financial bondage.  This is one of the reasons why Jesus focused much of His teaching on money and finances.  In Matthew 6:24 (MSG) Jesus defines financial bondage for us.  He says,  "You can't worship two gods at once.  Loving one god, you'll end up hating the other.  Adoration of one feeds contempts for the other.  You can't worship God and Money both." We cannot serve 2 masters!  Jesus said it and I believe it. It’s impossible to serve 2 masters.  We will get confused and chaos will happen.  And…  God will not share His throne.  If we chose to be a slave to money, He will allow us to pick that path.  Financial bondage is allowing money to take the place of God in our lives.  It becomes the center of our universe.  Money becomes an idol and when we live to serve it, we are in financial bondage.

Now that we have a definition of financial bondage, let's look at a picture of financial freedom.  The people of the first church experienced financial freedom.  Acts 4:32 (NLT) states “All the believers were united in heart and mind. And they felt that what they owned was not their own, so they shared everything they had.”  They lived as if what they owned was not their own!  Isn’t that amazing?  Everything that we have does not belong to us but is entrusted to us from God.  He provides us with all that we have and all that we need.  God created everything and He owns everything.  We are trustees.  A trustee has no rights, only responsibilities – the responsibility to care for what belongs to someone else. 

Reaching financial freedom requires an understanding that we own nothing but care for all that God has given us.  We are stewards.  We are not entitled and we don't deserve anything.  Can you imagine what our world would look like if everyone lived as if what they owned was not their own?  Those of you who have taken the courageous step to start the journey towards financial freedom can start the ripple effect that can change the world.

~Alesha

Ooh, I Need That...

“It’s on sale!” you say. “I’ll never get it cheaper!” Or perhaps you are more inclined to rationalize with, “I’ll use that for lots of things, and I don’t have one. I practically NEED it.” Yes, I too practically needed an XBOX 360, Nintendo Wii, cordless finish-nailer, and an iPhone. While these are all great things, and I use them all quite extensively, I can’t really say that I needed them. In fact, as I bought 3 of 4 on credit, I ended up paying a lot more than retail for them, even though I bought them on sale (I’ll explain this some other time when I talk about compound interest).

Some people think debt magically appeared about the same time as credit cards. But debt has been around for a really long time; thousands of years in fact. Why is that, do you think? I believe it boils down to one simple thing. We see something we want, and we’ll do anything to get it. It doesn’t matter that we don’t have the money for it. It doesn’t matter that we don’t really need it, that by buying it I’ll actually increase my expenses just by having it, or that it doesn’t really match anything I own so I’ll “need” to go buy some other stuff now to match it.

Deep down we believe that stuff brings happiness. We are not content with our lives. We compare ourselves and our stuff to the people down the street, down the hall, or down the aisle at church. By having newer, better, bigger stuff, people will think more highly of us. Isn’t that important? Uh, no. Have ever really sat back in your chair and contemplated how great so-and-so is because of the stuff they have? If someone is nice they’re nice. If they're a *@$^~# then they’re *@$^~#. They’re stuff has nothing to do with it.

So why do we chase "stuff"? It’s very easy to blame it on our society. With all the advertising and slick marketing campaigns, I don’t think it’s wrong to place some blame there. But the majority of the blame rests with us, you and me. We decided we'd go with it. We decided to buy that, and that, and maybe even that over there. No one made us. We can continue to ride the tide of stuff and status, or we can stop, stand in the water, and take our licks as we go against the waves that will try to pound us into submission and conformity. You will probably fall, I have. Some of the waves are pretty big and they pack a mean punch. But I have gotten up again, and so can you. I can see the beach ahead of me, and I’m going to make it. Will you allow the tide to pull you off into the middle of the ocean where there’s nothing to do but drown, or will you stop, stand up tall, and take your first step?

~Kevin