Decisions (Part 2)
Financial Decisions
Text: 2 Corinthians 1:17 NASB
“Therefore, I was not vacillating when I intended to do this, was I? Or what I purpose, do I purpose according to the flesh, so that with me there will be yes, yes and no, no at the same time?”
This message is the second in a series of messages called “Decisions.” In part 1, we learned about good decisions, bad decisions, and no decisions. Decisions are important because they determine your destiny, and in this message, I want to deal with financial decisions.
These principles that I will cover are very basic. I know everybody says, “I know all this stuff.” Well, the problem is, everybody doesn’t know it. The bad thing about poor financial decisions is that you live with the consequences for years. So, obviously, financial decisions are important.
My premise in part 1 of this series was that one good decision can start you out of the wilderness of hundreds of bad decisions. That means there is always hope. In the financial area, I cannot tell you how many people have received just a little bit of counsel and information that helped them set their course to eventually get completely out of debt.
Let’s begin with a verse in 2 Corinthians 1:17, New King James Version: “Therefore, when I was planning to do this, did I do it lightly? Or the things I plan, do I plan according to the flesh, that with me there should be Yes, Yes, and No, No?” In the New American Standard, it says, “Therefore, I was not vacillating when I intended to do this, was I? Or what I purpose, do I purpose according to the flesh, so that with me there will be yes, yes and no, no at the same time?” A problem in decision making comes when you can’t decide whether to say yes or no, and a lot of time in finances, it comes down to a yes or no decision. In today’s economic world, you’ve got to make the right decisions. I don’t say that to make you afraid, but you do have to learn principles to help you make wise financial decisions. Let’s look at six of these principles.
1. Should I spend it, save it, or seed it?
This first principle has to do with your budget. What do you do with the money that you earn? When you get paid, you have three options concerning your money. You can choose to spend it, save it, or seed it.
Years ago, I heard the principle of 10-10-80. That principle means to tithe 10 percent, save 10 percent, and live on 80 percent. That’s a simple formula that really works, as I have had many people testify to me.
Good financial decisions require budgeting. A budget is actually nothing more than a tool for making decisions. If you don’t have a budget, you are not making decisions. You are saying, “I’m just going to spend and hope that I have enough money at the end of the month.” So making a budget is the first step in making good financial decisions. It is a decision to live within your means.
I laughed at what one guy said. He said, “I have decided to live within my means, even if I have to borrow the money to do it!” Now that is a ridiculous statement because living within your means, means that you do not have to borrow. If you are borrowing money every month to make it, then you are living outside your means. You are going to have to cut some things out.
Before buying something, ask yourself, “Is this purchase a part of my budget? Will it bring greater peace to my life? Will it help me advance the kingdom?” Most of the time, the answer will be no, and you should not buy the item.
A second option with your money is to save it. Ask yourself, “Should I save it?” A lot of times people don’t understand the importance of an overall financial plan. An overall financial plan will keep you focused and able to decide when you need to spend money and when you need to save it.
A sister in our church had been struggling financially. She said her problem was that she couldn’t stop shopping and just had to have more clothes. One day she pulled up to a red light on her way home from work and the thought came into her mind, “I’m going to go by T. J. Maxx and buy a dress.” She was at the red light, she had the blinker on, she was turning right to go to T. J. Maxx, and then a thought from the financial series we were doing in church came to her. She thought, “Is that dress a part of my long-term financial plan?” She reminded herself that her closet was already crammed full of dresses that she couldn’t even get to, so one more dress was not a part of her long-term plan. So for every purchase you want to make, ask yourself, “If this money was being saved and working for me with interest, would that be a better option rather than spending it?”
You have a third option with your money: you can seed it into God’s kingdom. The tithe already belongs to the Lord, but you can sow additional seed into good ground. You are making a wonderful investment when you seed money into projects, organizations, or individuals that are bearing fruit for God’s kingdom.
Those are the three questions to ask when allocating your money: should I spend it, should I save it, or should I seed it? And it’s got to be a part of your budget.
2. Is it honest and aboveboard?
Here is the second principle that I want to give you: is it honest and aboveboard? You need to check the honesty of all your financial decisions. I laughed at a story I heard about a letter that was sent to the IRS. Here is how it read: “Dear sirs, last year when I filed my income tax, I deliberately misrepresented my income. Now I cannot sleep. Enclosed is a check for $150. If I still can’t sleep, I will gladly send you the rest.” That, of course, is not honesty, because honesty is not just sleeping better but actually doing the right thing, treating your neighbor as yourself
Money is a test of honesty. It is only something temporary that tests your heart. In the Bible, people like Ananias and Sapphira were dishonest and suffered grave consequences (they were struck dead!) God takes the issue very seriously.
Think about it just a minute. Most of us would say, “I never steal.” But stealing is not just taking money from people and running down the street with it. Stealing can also involve time. If your company pays you to work to three o’clock in the afternoon but you leave at 2:45, you’ve stolen fifteen minutes of their time. Maybe you’re stealing small items from your company to take home for personal use, or maybe you’re padding an expense account. These, too, are forms of stealing.
Stealing can also involve ideas. If somebody else thought of something, that idea really belongs to them. You can’t take credit for it, because that is their idea, their intellectual property. To claim it as your own is stealing.
You can even steal relationships. If you leave a company and then contact all your former customers, saying, “I’ve started my own business and want you to come with me,” that is stealing. That company gave you a platform from which you are now contacting those people and working against your former employer.
Stealing really means taking anything that belongs to another, and sometimes that person is God. For example, the tithe is the Lord’s. So, for me, tithing is not a decision I have to make, because it belongs to God and I’m just returning it to Him.
An interesting thing to me is how people borrow stuff and never get around to returning it. As long as those things are in your house, you’ve stolen them. You really ought to go through your things and see if there is anything that doesn’t belong to you. When you have things that don’t belong to you, you have forgotten the royal law, or the golden rule. It’s found in Matthew 7:12: “Treat people the same way you want them to treat you” (NASB).
The golden rule is the second law of finances. It’s how you make decisions. It’s a core value not to be violated. Your integrity means more than all the money in the world.
3. If it is debt, is it tied to an asset that has equal value?
The third principle of making financial decisions deals with debt: is the debt tied to an asset that has equal value?
America is in the biggest economic mess we’ve ever been in, largely as a result of uncontrolled debt. We owe almost ten trillion dollars. But debt is like that. It grows and grows and always has to be paid back sooner or later.
Debt that is not tied to an asset is called unsecured debt, and it is especially dangerous. Credit-card debt is the prime example. Either pay your credit cards off every month, or cut the cards up.
Cars, too, can be unsecured debt. If your car is worth more than you owe on it, that is not unsecured debt. But if you buy a brand-new car that is worth less than you paid for it the day you drive it off the lot, that is unsecured debt. That’s why used cars are such a good value.
House debt should never be unsecured. This is a relatively new thing in our economy on the scale that we’re seeing it today. In some places, housing values have decreased as much as 25 percent, and some people owe more on their homes than they are worth.
So you must be very careful as you look at your housing situation. When buying a home, don’t buy the most expensive home in the neighborhood. Instead, buy one of the least expensive ones and let it appreciate with the rest. Also, watch out for adjustable-rate mortgages. If you are in one of those, do whatever you can to get out of it. Furthermore, don’t build a house based on fantasy, but build for resale. Research what makes homes sell and incorporate that into any house that you build.
Never exceed 35 percent of your budget for housing. That includes utilities, insurance, house payment, maintenance—everything. Never cancel your homeowners insurance. Look for problems with flooding before buying.
4. Is there agreement in the decision?
Amos 3:3 says, “Can two walk together, except they be agreed?” (KJV). If you’re married, never enter into a business decision or make an investment without the full agreement of your spouse. They might be able to spot something that you fail to see. You can be so enamored with an investment or a person that you can’t see the obvious. The Bible says, “Two are better than one,” so you should come into agreement with your spouse when making major financial decisions.
Also, never, never go into partnership with an unbeliever, because he may think something is ethical that you know is unscriptural. Eventually those lines are going to cross. Also, don’t co-sign a note; Proverbs says that is not good. That’s how relationships are destroyed. The moment you co-sign a note for someone, you change the nature of your relationship with them. I’d rather give a gift to somebody than co-sign something for them.
5. Is it good stewardship?
The word stewardship means to not waste. Thrift, if you look it up in the dictionary, means the quality of using money carefully and not wastefully. God does not waste things. I always remember the story of how Jesus multiplied the bread and fish. Do you remember how after He fed the 5,000, He had His disciples gather the leftovers? That’s telling, because Christ could have multiplied millions of fish and loaves anytime He wanted, but yet He did not want His provision wasted. He was always a good steward.
Waste is abusing God’s provision. When you are a good steward, you take what God gives and don’t abuse it. I remember something George Mueller once said. This man, who cared for orphans in England for 25 years, was a man of great faith and a recipient of God’s miraculous provision. But in those 25 years, he learned that when they ran out of money and he couldn’t figure it out, somewhere there was waste. So he would go over their budget, and when he found the waste and corrected it, God’s provision not only came but also increased.
Jesus said, “The treasure is in the field.” Maybe God has already provided for you, but it’s being wasted. It’s kind of like a pipe that’s leaking and you can’t understand where your water is going. Stop the leaks, and you will increase the flow. That’s always the principle of God.
Also, there is the issue of training. If you’ve got latent gifts and talents inside of you, that’s not good stewardship. You may not necessarily need a degree, but you do need to maximize your resources. If you are good at math, you need training in how to work with money and with finances. If you are good at speaking, you need training in how to be better. If you are good with the Scriptures, you need training in how to be better. So maximize your resources, and be a good steward of your gifts and talents.
6. Am I ready for the future?
We, of course, cannot know the future and everything that will happen to us. What we do know, however, is who is in the future and who holds the future—and that’s Jesus. So we need not fear the future. But at the same time, we must make practical preparations for the future, and in our finances, that includes three parts.
Number one is your short-term future in the form of savings. You need at least three months of savings to have a cushion for a loss of a job or unexpected expense. Three months is really a minimum; six months is much better. If you don’t have three months of living expenses set aside, that needs to be your first priority before you start planning for retirement or any other kind of future need. I encourage you to do that immediately, even if you have to sell some things to get the money.
Number two is insurance. This prevents a calamity in your finances when something catastrophic happens. One major catastrophe can bankrupt you, so you need to have at least minimal insurance to protect yourself. If you don’t have medical insurance, at least look at major medical. This is a more affordable option than full medical coverage, but at least you will have something to help you in a major health incident.
With cars, you don’t have to have the highest coverage, but you must at least maintain liability, as the law requires.
The final preparation for the future is retirement. This is very, very important. Do a study about what you’ll need to live on when you are of retirement age. You might be surprised and discover that you need to start putting aside a great deal more of your income toward retirement. If you start preparing in your twenties, it’s pennies on the dollar compared to what it is if you wait until you’re in your fifties. The money you put in when you’re young has time to increase with compounded interest, but you lose this benefit if you start late.
If you follow the six principles in this lesson, you can start making good financial decisions that will change your life!
