Life Simplified
Money Matters Simplified
October 23, 2011
INTRODUCTION
Good News and Bad News:
Recently American households have pared their debt (from $12.5 trillion to $11.6 trillion),
Most of that came from home foreclosures and defaults on credit cards.
89 percent of Americans say they're watching their expenditures,
Spending has ballooned in certain areas. Telephone equipment (up 16.6 percent), pet expenses (up 14.4 percent), and child care (up 12.8 percent).
From the start of the recession, though we have sought to cut back,
Impulse buying still is prevalent.
Runaway spending. First, Maria Diaz, a 30-year-old waitress who was forced to move in with her mother, said, "I keep waiting for things to get better, and they just don't. After awhile I just decided, 'Screw it. I need some new clothes. I'm going to get them.' My mama's not happy, but I don't care. You stop spending, and you stop living."
Then there's the story of Harry Dugan, a 50-year-old respiratory therapist from New Jersey. Although he's "underwater" on his mortgage and he tried to curtail his expenses, he recently "had a bit of a relapse": he purchased a $900 television and a $21,000 car. "It was an impulse buy," he confessed. "If I could go back, I'd get something cheaper."
P.S. A LIFE SIMPLIFIED GETS A HANDLE ON FINANCIAL AND MATERIAL WEALTH.
* Wealth and possessions are a gift from God, to enjoy.
Ecclesiastes 5:19
Everyone also to whom God has given wealth and possessions and power to enjoy them, and to accept his lot and rejoice in his toil--this is the gift of God.
Wealth is of great value in our world. Without it nothing good or bad gets done. Nothing gets produced, nothing gets passed on to the next generation, no new business starts etc.
But. . .
* But Wealth can distract us from him.
Proverbs 30:8-9
8 Keep falsehood and lies far from me; give me neither poverty nor riches, but give me only my daily bread.
9 Otherwise, I may have too much and disown you and say, 'Who is the LORD?'
Or I may become poor and steal, and so dishonor the name of my God.
Ultimately wealth is limited in its value.
Matthew 6:19
19 "Do not store up for yourselves treasures on earth, where moths and vermin destroy, and where thieves break in and steal.
In the end, Proverbs teaches us that acquiring wealth is a blessing, but one that comes with practical and moral risks.
I. Honor God
Tennessee Titans center Kevin Long, who played under Coach Bobby Bowden at Florida State University, said his college coach inspired the team with parables. Long recounted a favorite story:
[Bowden] was playing college baseball, and he had never hit a home run. Finally he hit one down the right-field line, into the corner. He rounds first and looks to the third base coach. He turned at second, was halfway to third and the coach was still waving him on. He got to home, he hit the plate. He had his first home run, he was so excited and everybody was slapping him five. Then the pitcher took the ball, threw to the first baseman, and the umpire called him out.
[Coach Bowden] said, "If you don't take care of first base, it doesn't matter what you do. If you don't honor the Lord first, it doesn't matter what else you do."
The Tennessean (9-29-00); submitted by Rubel Shelly, Nashville, Tennessee
Proverbs 3:9-10
9 Honor the LORD with your wealth, with the first fruits of all your crops; 10 then your barns will be filled to overflowing, and your vats will brim over with new wine.
II. Stop Chasing Fantasies
Proverbs 12:11
11 Those who work their land will have abundant food, but those who chase fantasies have no sense.
Proverbs 28:19
19 Those who work their land will have abundant food, but those who chase fantasies will have their fill of poverty.
Lotteries
In 2010, the Lehigh Valley Research Consortium released a report showing that 48 percent of those below the poverty line in the Lehigh Valley intend to gamble at the Sands Casino in Bethlehem, Pennsylvania. "The casino ads always show young glamorous-looking people gambling," said Michele Moser Deegan, a Muhlenberg College associate professor who directs the consortium. "But when you go inside, you can see that it really is the working poor and middle class. This survey shows that."
III. Stop Scheming
Proverbs 1:30-33
28 "Then they will call to me but I will not answer; they will look for me but will not find me, 29 since they hated knowledge and did not choose to fear the LORD.
30 Since they would not accept my advice and spurned my rebuke, 31 they will eat the fruit of their ways and be filled with the fruit of their schemes.
32 For the waywardness of the simple will kill them, and the complacency of fools will destroy them; 33 but whoever listens to me will live in safety and be at ease, without fear of harm."
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IV. Stop Sleeping - Start Working
Proverbs 6:6-11
Last Week's entire message was dedicated to this truth, I will only reference it here this week.
V. Deal with the Debt
A. Live within your means
Proverbs 13:7
7 One person pretends to be rich, yet has nothing; another pretends to be poor, yet has great wealth.
Proverbs 12:9
9 Better to be a nobody and yet have a servant than pretend to be somebody and have no food.
Five Signs You are Likely Living Beyond your means
Sign No. 1 - Your Credit Score is Below 600
The numerical rankings go from a low of 300 to high of 850. The higher the better. It's this score that lenders use to determine whether they'll grant a loan. In general, any credit score below 600 means that you are probably in over your head.
Sign No. 2 - You are Saving Less Than 5%
In 2006, the average rate of personal savings was an astonishing -0.5%, according to the U.S. Bureau of Economic Analysis. That means that not only were we spending all of our income, but also that a good number of us were also dipping into personal savings. This was the worst savings rate that Americans have recorded since 1933 when it was -0.7% during the Great Depression. The rate bounced back into positive territory in 2008, and climbed further in 2009. But it is still under 1%
Sign No. 3 - Your Credit Card Balances are Rising
A person with $5,000 in credit card debt that makes the minimum payment of just $200 per month will end up spending more than $8,000 and take almost 13 years to pay off that debt.
Sign No. 4 - More Than 28% of Income Goes to Your House
Calculate what percentage of your monthly income goes toward your mortgage, property taxes and insurance. If it's more than 28% of your gross income, then you are likely in over your head.
Why is 28% the magic number? Historically, conservative lenders have used the 28% threshold because their experience has told them that this is the rate at which the average person can get by, make their mortgage payments and still enjoy a reasonable standard of living.
Sign No. 5 - Your Bills are Spiraling Out of Control
Buying on credit and paying by installment has become a national pastime. It's much easier to buy a new flat screen TV when the salesman breaks down the price in monthly installments. What's an extra $50 per month, right? The problem is that all of these bills start to add up, and you end up nickel and diming yourself into bankruptcy. If your monthly income is being sliced and diced to pay for dozens of unnecessary installment purchases and services, you are likely in over your head.
Bob Patusky made this point. There is a sense that when one lives beyond their means -- "things" have become their God. God said to Abraham "I am thy exceeding great reward." (Gen 15:3) Proverbs 3:32 says "He is intimate with the upright." (NASB) 1 Timothy 6:6 says "Godliness with contentment is great gain."
B. Stop Borrowing
Proverbs 22:7
7 The rich rule over the poor, and the borrower is slave to the lender.
C. Stop Spending On Little Luxuries --
Proverbs 21:17
17 Whoever loves pleasure will become poor; whoever loves wine and olive oil will never be rich.
Steve Beal would title this "Stop living for comfort and spending for pleasure". He noted If you go to Crocker Park or Legacy Village or Polaris, you will be hard pressed to think we are in tough times. Shopping, eating out, cooler phones, all stuff we think we have to have. How many iphones sold in 3 days- 4 million, how many Kindle Fire tablets sold as pre-orders (comes out November 14th) 20,000 a day.
D. Pay it Down
Psalm 37:21
21 The wicked borrow and never repay, but the godly are generous givers.
It just has to become a big enough priority to you.
If a doctor told you that your child was dying and could only be saved with a $15,000 operation that your insurance would not cover and could only be performed nine months from today, could you save $15,000?
You would sell things, you would stop any spending that wasn't required to survive, and you would take two extra jobs. For that short nine months, you would become a saving madman (or madwoman). You would give up virtually anything to accomplish that $15,000 goal. Saving would become a priority.
E. Face the Consequences
Proverbs 22:27
27 if you lack the means to pay your very bed will be snatched from under you.
In the New Testament the Church assumed that there were moral obligations to fulfill that were financial in nature.
"Give everyone what you owe him: if you owe taxes, pay taxes; if revenue, then revenue." Romans 13:7
VI. Start Saving For the Future
Proverbs 21:20
20 The wise store up choice food and olive oil, but fools gulp theirs down.
Proverbs 13:22
22 A good person leaves an inheritance for their children's children, but a sinner's wealth is stored up for the righteous.
* Saving money is not a matter of math.
You will not save money when you get that next raise. You will not save money when that car is paid off. You will not save money when the kids are grown. You will only save money when it becomes an emotional priority.
* The secret to saving?
Focused discipline that keeps you doing it.
Steve Beal would teach that discipline keeps you doing it after the emotion wears off. If it becomes too emotional, it becomes greed whether you have much or little. I have witnessed this many times and some of the greediest people I know have very little net worth.
VII. Stay Focused -- Work your plan
Make it happen
Proverbs 17:24
24 A discerning person keeps wisdom in view, but a fool's eyes wander to the ends of the earth.
Proverbs 21:5
5 The plans of the diligent lead to profit as surely as haste leads to poverty.
Proverbs 20:18
18 Plans are established by seeking advice; so if you wage war, obtain guidance.
Proverbs 15:22
22 Plans fail for lack of counsel, but with many advisers they succeed.
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SUMMARY
Honor God
Stop Chasing Fantasies
Stop Scheming
Stop Sleeping -- Start Working
Deal with the Debt
Start Saving for the Future
Stay Focused -- Work your plan
SO WHAT'S NEXT
* Confess your need to God
* Recommit your finances to Him
* Seek counsel
* Create a plan
* Get started
