BIBLICAL FINANCIAL

PRINCIPLES

..\Documents and Settings\Jim\My Doc

Jim Sutherland, Ph.D.,

Director
www.RMNI.org/financial

1
 INTRODUCTION

 Are you financially free or in bondage?

 Do you give generously?
 Do your assets exceed your liabilities ?
 Do you have a short-term financial plan ?
 Do you have a long-term financial plan ?
 Do you honor God with your giving ?
 Are you saving regularly?
 Do you have adequate insurance and
a will ?
 TOPICS
 The Master or the MasterCard ?
®

 Contentment
 The Real Owner?
 Family Finances
 Giving & Receiving
 The Lowdown on Debt
 Short-term Planning—The Budget
 Long-range Planning--Savings
 Fundamentals of Investing
 THE BIBLE AND MONEY
• 51% of African Americans are “personally
struggling with finances” (Barna, 2001).
• Is the Bible able to advise us into the
second millennium ?
• Will we trust the Bible when we disagree
with it ?
• There are many “experts”--who will you
believe ?
 WHAT IS A CHRISTIANS’
FIRST COMMITMENT ?
 What do we commit to
God ?
 Matt.
6:33; Mark 12:30;
Rom. 12:1-2; Col. 1:16
 The Macedonian example
(2 Cor. 8:1-5)
 Few resources, first
commitment, giving (9:8-
11), grace
 Does my spending reflect
trust in God ?
FINANCES TEST OUR
COMMITMENT to GOD
• There are two masters—Luke
16:9-13
• The “Rich Young Ruler” illustrates
—Luke 18:18-23
• $ is stronger than blood and
friendship—Prov. 19:7
• Money offers pleasure, prestige,
power
• We can’t love God and the world—1
John 2:15; Demas tried--2 Tim.
4:10
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FINANCES TEST COMMITMENT
• Honestly, do you want to be rich?
• If we “go for the gold” & choose
money and affluence as Master
• Temptation, traps, grief,
destruction—1 Tim. 6:9-10
• Dissatisfaction—Ecclesiastes
5:10
• Chokes the Word of God—
Matthew 13:22
• Riches take wings—Prov. 23:4-5
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 Where Is Your
Treasure?
• Are we trying to build heaven
on earth?
• We cannot manipulate God by
giving, or by praise or by
claiming something. God is
too smart for that.
• Beware of greedy teachers
who exploit you with false
words (2 Pet. 2:3). If some
really believed in “seed
money,” they would send you
the money.
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Where Is Your Treasure?
• The “prosperity gospel” preaches
materialism and greed in the name
of super-spirituality.
• Some teach that Jesus was rich,
“justifying” a Rolls Royce.
• According to the NT, riches are
instead a spiritual liability, making it
harder to enter heaven (Matt: 19:23-
24). Riches tend to choke the Word
of God (Matt. 13:22).
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The Creator and The Creation
 Material riches are not to be our goal, but things
material are not evil in themselves. The good
God created very good things out of matter—
stars and people and butterflies and whales
(Gen. 1:31).
 The focus is to be on the Creator, instead of upon His
creation.
 Matthew 6:21 “For where your treasure is, there
your heart will be also.” NIV
 If God is our treasure, He can entrust to us the good things
of His creation, knowing that they will not become idols—
i.e. become more important to us than is God.
 Psalm 37:4 “Delight yourself in the LORD and he
will give you the desires of your heart.” See also Ps.
16:11; 84:11b; Rom. 8:32. The more we love God,
the more He is free to bless us, and I suspect we
place less and less intrinsic value upon those gifts.
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Wealth and Christians
 God blessed Abraham, Job, David, Solomon,
Hezekiah, etc. with much wealth (Gen. 24:35; Job 1:3; I
.
Chron. 29:3-5; 2 Chron. 1:12; 2 Chron. 32:27)

 The fact that stealing remains a sin (Rom.

13:9) implies that private property is
approved by God.
 The “rich” (us) are not told to divest of
wealth, but to be richly generous (1 Tim.
6:18). If you make $10,000/year you are
among the upper 9% of the worlds affluent.
From the World Christian Encyclopedia, David
Barrett, George Kurian, Todd Johnson, Eds. 2001, p.
1:6
Riches are deceitful. It remains harder for the
rich to enter heaven—Matt. 19:23.
 Real Prosperity:
 Prosperity is:
 Your name written in heaven, Lk.10:20
 Contentment, with godliness, 1 Tim. 6:6
 Without contentment, you’ll never have
enough.
 God meeting ALL your needs, Phil. 4:19
 How much more do you need?
 Proverbs 30:7-9 "Two things I ask of you, O
LORD; do not refuse me before I die: 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. 12
 Real Prosperity:
 Prosperity is:
 Having all the funds you need to
accomplish all the work that God has
given you to do in life, Eph. 2:10
 Preparation and ministry cost money.
 Having the world--all things are the
Christian’s (1 Cor. 3:21-23; Rom. 4:13
—JRW Stott).

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FINANCES TEST COMMITMENT
If you go for the crown and the Lord
 All your basic needs will be met—Matt.
6:25-34 (sometimes these will be met by
others, James 2:14-17).
 All other needs will be met—Phil. 4:19,
Rom. 8:32
 Can you buy a policy that meets ALL your
needs?
 We’ll have enough to share
 Our lives will find balance between work
and rest—Eccles. 4:5-8.

Is my trust in my Master or in my
MasterCard®? 14
 Security
• If your security is in wealth,
you will never have enough
wealth to be fully secure. A
man who has given away over
11 million dollars freely
admits this, since wealth is
quickly lost.
• God is enough. When you
have Him, you are secure no
matter what happens
financially.
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 CONTENTMENT
 Are you content right now ? 1 Tim. 6:6
 Debt often indicates lack of contentment.
 What are the minimums? 1 Tim. 6:8
 Will Christians always have them? (2
Cor. 11:27; Matt. 8:20; 2 Pet. 1:3).
How was Paul content? Phil. 4:13
 What would it take to make you
content, if you’re not ?
 What is abundant life? (John 10:10)
Life = possessions? Luke 12:15
Life = Christ? Colossians 3:4
Loss = despair? Job 1:20-21; Hab. 3:16

CONTENTMENT
 DIS-CONTENTMENT
• Advertisements-- $850 @ American in
2000
• Materialism & the shopping mall temple
• Giving fights materialism
• The prosperity of the wicked—Psalm
73:3- 5,12
• The prosperity of other believers—Acts
20:33
• Is God enough right now? Psalm 73:25
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 WHO IS THE OWNER ?

• YOU ? THE BANK ? GOD ?

• What does God claim? Ps. 24:1; 50:10-12;
Haggai 2:8
• Where do you go when you need $ ?
• Ask, Seek, Knock—Matt. 7:7-11; Ps. 50:14-15
• How does God meet needs?
• God “burdens” folks to desire to give—2 Cor.
• 8:5,16; Jews, 1 Chron. 29:8-14
• How can I admit God’s ownership?
 FAMILY FINANCES
• Should a wife or mother work outside
the home?
• Adam provided—Gen. 3:17-19
• Male provision for the wife illustrated in
• 1 Tim. 5:8; Hos. 2:2-9; Ezek. 16:8-13
• The wife assists her husband—Gen.
2:18, doing him good—Prov. 18:22
• She raises the children and manages the
home—1 Tim. 5:14; Titus 2:3-5
• God wants “godly” offspring—Malachi 2:15
• The Prov. 31 lady met family needs and was
a businesswoman (vs. 16, 24)
• An empty nest may require new challenges
for a wife.
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 FAMILY FINANCES

If a mother of young children works to

increase the standard of living, she may
gain little net increase.
She may end up with work both at home
and the office.
Daycare means someone else raises the
child and extra sickness (1-2 year-olds,
especially).
13 million children are in daycare in the US and
2/3 of mothers with children under 6 are
working (Katha Pollitt, “Happy Mother’s Day,” The Nation, 5/28/01)
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 FAMILY FINANCES

• The Institute for Social and Economic

Research (British) found that “Married men
earn more than single men, but only if their
wife stays home—and does all the chores.”
• Sociologists Vincent Duindam and Ed
Spruijt of Utrecht Univ. found that “the
more hours the mother works, the worse
the father’s physical and mental health.”
“Housewives make their men healthy and wealthy” 6/30/05
www.telegraph.co.uk/health/main.jhtml?xml=health/2005/06/30/hworking30.xml
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 FAMILY FINANCES

• 55% of mothers with children under 1

worked or were looking for work in 2000,
down from 66% in 1998. (USA Today, Stephanie Armour,
“More moms make kids their career of choice” 3-12-02)
• A separate income may promote an
independent spirit in the wife and divorce.
33% of married Christians (and 34% of non-
Christians) divorce (Barna 8/6/01). A job may be
seen as an “insurance policy” against it.
• Sometimes wives and singles must work.
• Divorce, death, out-of-wedlock pregnancy and
desertion may force a mother to work.
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 GIVING
How much?
• Should a Christian tithe because mandated in
the Old Covenant? (Gal. 3:10; James 2:10; Heb.
8:8-13)
• Generosity is commanded of the rich (us) in the
NT (1 Tim. 6:18)
• The Law of receiving and giving (1 Cor. 16:2;
2 Cor. 9:6; Eccles. 11:1; Prov. 11:24-25).
• Attitude is crucial—why do I give?
• For love (I Cor. 13:3), cheerfully (2 Cor. 9:7;
8:1) and secretly (Matt. 6:1-4)?
• Give to receive ? To buy God off (Amos 2:6-
8; 4:1-5, 12) ? 24
 GIVING
How much?
• Christians are to give an unspecified percentage of
our increase to God, but we give proportionately to
our receiving.
• 1 Cor. 16:2 2 On the first day of every week, each one of
you should set aside a sum of money in keeping with his
income, saving it up, so that when I come no collections
will have to be made).
• We receive proportionately to our giving. Giving
7%, for example, is not a sin. The Spirit will lead
you.
• However, a tithe is the least that God has asked His people to give (Larry
Burkett). A tithe was given before the Law (Gen. 14:18-20); and was
commanded in the Mosaic law (Lev. 27:30).
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 GIVING
How much?

• Generosity is commanded of the rich in the NT (1 Tim.

6:18)
• The Law of receiving and giving governs our giving (1
Cor. 16:2; 2 Cor. 9:6; Eccles. 11:1; Prov. 11:24-25).
• Attitude is crucial—why do I give?
• For love (I Cor. 13:3), cheerfully (2 Cor. 9:7; 8:1) and
secretly (Matt. 6:1-4) ?
• Do I give to receive ? To buy God off (Amos 2:6-8;
4:1-5, 12) ?
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 GIVING
• Can we first give to God ? (Rom. 11:35-36)
• What part does God request ? (Prov. 3:9)
• How much should Christians give ?
• Should we tithe ? Only 3% of born-again Christians
tithed in 2002—down from 8% in 2001 (Barna 5/19/03).
In 2001 16% gave nothing to the church (Barna 5-21-01).
Globally Christians give 2% of personal income to
Christian causes, while in the US it is about 2-3%.
(Barrett & Johnson, Int’l Bulletin of Missionary
Research, 1/03, p. 25)
• A tithe was given before the Law (Gen. 14:18-20); and
was commanded in the Mosaic law (Lev. 27:30).
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 GIVING

 Don’t give due to being pressured (2 Cor. 9:7) via

phone, mail, or solicitations from friends. Ask for
time to pray for guidance. Many ministries use the
most effective marketing techniques to generate
income. Because someone found you does not
mean that you are to give. Some have very high
overhead (fireman’s charity concert).
 A need does not necessarily mean that you
should meet it, just as a ministry opportunity does
not necessarily mean that you should engage it.
We are to walk by the Spirit, and keep seeking
God’s wisdom (Gal. 5:25; Prov. 3:5-6).

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 GIVING

 Should all giving go to the church?

Is the staff adequately paid? (1 Cor. 9:7-
14, 1 Tim. 5:17-18, Gal. 6:6)
Are the truly needy supported—
believers and unbelievers? (Jas. 2:15-17;
Gal. 6:10)
Are missions advanced? (Matt. 28-19-
20; 3 John 1:5-8)
Is the property maintained? (Haggai 1:7-
9)
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 GIVING

• Guidelines for giving outside the church

• Whose kingdom is glorified? (1 Cor. 10:31)
• What percentage is spent on administration?
• Check www.give.org for organizations
giving 60% + to programs and
www.charitynavigator.org for evaluations
of charities. See www.wallwatchers.org
• Form 990 can be obtained from Guidestar for
many not-for-profits at www.guidestar.org
• Follow the burdens (work) God gives
specifically to you (Eph. 2:10). Only God can
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meet all needs.
 6 LEVELS OF GIVING
1. Giving little or nothing. Among Baby-
busters (18-35), only half gave anything to
the church in 2002.1
2. Inadequate giving. Giving less than 10%.
3. Obedient giving. Giving a tithe.
4. Giving beyond obedience--beyond the tithe.
5. Giving generously, being “willing to share”
(2 Cor. 9:6).
6. Surpassing generosity. Giving out of God’s
bounty, becoming a conduit of His blessing
(2 Cor. 9:8,10-11).

1 George Barna, “Americans Were More Generous in 2001 Than in 2000,” 4/9/02, accessed at
www.barna.org on 2/7/03
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 BIBLICAL FINANCIAL
PRINCIPLES

..\Documents and Settings\Jim\My Doc

Jim Sutherland, Ph.D.,

Director
www.RMNI.org/financial

32
 Jim’s Badboy 13 Omens
n If you missed a paycheck, you’d
qualify for federal disaster aid.
n You hit-up your friends for a loan
until payday, or you’ve gotten a
check-advance loan.
n Your first strategy to meet an
unexpected bill for $1000 is the
Lotto 5.
n You owe more than you own. If you
died, your family would need help.
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 Jim’s Badboy 13
n You skimp on groceries and work
clothes.
n You have no plan to (1 save for your
children’s education (2 pay off your
home (3 have enough for retirement.
n Because of debt, your paycheck is
already spent. But you might be able
to rent a movie.
n You try to stay one-jump ahead of
disaster by rolling over credit card
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 Jim’s Badboy 13
1. Dollars stick to you like Superglue
®

when you have the chance to give.

2. You argue almost every week about
money.
3. You’ll really be content when you
get the new ….
4. Bankruptcy is looking good.
5. You’re trying to get rich quick.

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 DEBT
 The Problem:
 “33% of born again adults say it is
impossible for them to get ahead in life
because of the financial debt they have
incurred.” Barna.com BarnaPageStats.htm accessed 8/20/98
 “For at least a half century, household debt
has been rising faster than income, as ever-
higher levels of discretionary income have
increased the proportion of income spent on
assets partially financed with debt.” Alan
Greenspan (Oct. 2004)
www.federalreserve.gov/boarddocs/speeches/2004/20041019/default.htm

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 DEBT
 The Problem:
 “Throughout the 1960s, '70s, '80s, and '90s,
households showed a surplus of varying
degrees. It wasn't until 1999 — for the first
time in about 50 years — that U.S.
households started spending more than they
took in. What started as a small deficit of
about $50 billion among households quickly
spiked to a deficit of more than $350 billion
in the second quarter of [2004].” U.S. Consumer Credit
Card Debt May Crash Economy, 12/31/04 By Susan C. Walker
ww.foxnews.com/story/0,2933,143037,00.html

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 DEBT
 The Problem:
 On average, we carry eight cards per person and
have a balance of $8,400 in credit card debt.
Twenty percent of our cards are maxed out,
reports CardWeb.com, which tracks the lending
industry's machinations. And just 40% of
Americans pay off their accounts in full at the
end of the month. The average line of credit is
around $3,500. (A decade ago it was just
$1,800.) The average household pays their
lender $1,000 a year in finance charges. “Our Credit
Crunch” Dayana Yochim www.fool.com/ccc/secrets/secrets01.htm accessed 8/20/05

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 DEBT
 The Problem:
 Home equity loans are more popular than ever
as people borrow against their home to feed their
spending binge. Today, average homeowners
owe nearly 50% of their home's value. Twenty
years ago that figure stood at 30%. Can't you
just picture the modern-day needlepoint plaque?
"Home, Sweet Credit Line." “Our Credit Crunch” Dayana Yochim
http://www.fool.com/ccc/secrets/secrets01.htm accessed 8/20/05
 The US government owes over 8.2 trillion dollars in
2/06. (www.brillig.com/debt_clock accessed 2/10/06)
 What is your debt/income ratio—more than
10% (non-household debt to monthly income)?

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 DEBT IS DISCOURAGED
 The Bible discourages debt (Rom. 13:8; Prov. 22:7; Dt.
28:44), but it isn’t sin (Matt. 5:42; Dt. 23:20)
 Bankruptcy should be avoided and all debts satisfied
(Ps. 37:21).
 Debt is usually poor stewardship
 Paying only the balance due (2%) on $2,000 at 18%
would take 30 years and cost $8,000 in interest (Cardweb). A
mortgage may triple the face amount borrowed
 Average debt for 4-year private schools:
$17,500 (1998-Nellie Mae)
 Debt may be lack of self-control--Gal. 5:23.

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 Debt and Dissatisfaction
• Our consumer debt (debt other than for
our home, but including home equity
debt), is generally an excellent
indicator of our level of discontent.
– We step outside the circle of God’s
provision, to get more, by borrowing.
– Lack of contentment is a spiritual issue.

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How Can I Get Out of Debt?
■ You must be serious about it. As Larry
Burkett said, getting into debt is fun, but
getting out of debt isn’t. It will likely take
years.
■ If you are spending much more than your
income, you must go on a survival lifestyle.
◆ Before every purchase you need to ask
yourself, “Do I need to purchase this in order
to survive?”
■ You’ll need to determine if cutting back will
enable you to get out of debt, or if you’ll
need to increase income to meet your
commitments.
 Getting Out of Debt
■ If you have cable, or a cell phone, cut them
off. Buy out your contract if necessary. Stop
eating out. Tell your family that you won’t be
able to give gifts as you would like to do, until
you’re back on your feet.
■ But don’t stop giving to God. That would be a
bad solution.
■ Determine ALL your debts and pay off the
highest interest rate debt first. When that is
paid off, use the same payment, plus what you
don’t have to pay on the first debt, to tackle
the second debt, etc.
 Start Budgeting
■ You must go on a strict budget.
■ See the “How to Budget” and “Philosophy of
Budgeting” paper at
www.RMNI.org/financial
■ You may need to go to Consumer Credit
Counseling Service to negotiate lower
interest rates and penalties.
■ In over 20 years of personal financial
counseling have I seen a completely
hopeless situation, and none that would
justify bankruptcy.
Her Money—His Money
You are one in God’s sight (Matt. 19:5).
Don’t let money divide you.
The husband is the head of the wife (Eph.
5:23). With separate money, the wife can
develop an independent spirit and ditch
the husband.
Have complete financial openness
between you. Each should know the total
assets of the union. You should have joint
ownership of those assets. Both names
should be on the deeds and financial
accounts.
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Exceptions:
If the man directs the inheritance from
his family, the wife, in fairness, should
be able to direct the assets of her
family, under the final authority of the
husband.
If one of the partners has an
addiction, then it is not prudent to
hold all assets jointly. Additions
include drugs, gambling and
shopping.
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Avoid Separate Bank Accounts
But have one person balance the books
and reconcile the statements.
This person should be the one with the
greater aptitude, discipline and interest in
financial matters.
A husband is wise to obtain the counsel
of the wife in financial matters. She
does not want your half of the boat to
sink. Many husbands regret not
listening to that counsel. One husband
told me that he’d now be in “Fat City” if
he’d have listened to his wife when she
suggested buying specific pieces of
property many years ago.

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 Pre-nuptial Agreements

If you cannot trust you prospective

mate with your money, you shouldn’t
marry that person. Faithfulness in
money is a small thing (Luke 16:10-
11). Being bound for life to someone
is a heavy matter.

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 What Are Your Savings Goals?

• Save money/pursue investments:

– 8% of those having non-retirement income make
this their main goal (not all goal responses are
noted)
• Home purchase or renovation: 8%
• Be debt-free: 4%
• Emergency fund: 2%
– But 100% have emergencies.
• No goals: 6% Is this you?

• 67% of workers aged 35-44 and 74% of

workers aged 45-54 saved something for
retirement in 2004. Of those 55+, only 69%
saved something.
– But 100% of old folks will need something.
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Source: Retirement Confidence Survey® 2004
 Social Security Is Not Enough
• Currently, if you were born in 1960 or later, you
will not be eligible for full Social Security benefits
until you’re 67.
• As of 2000, if you are a man and live to 65, you
will live another 16.3 years—to 81.3. That’s a lot of
Christmases.
• Women at 65 live an average of 19.2 more years—
until they are 84.2—almost 3 years longer than
men. Will you be able to take care of both of you,
and will your wife be provided for when you’re
gone?
• The average Social Security payment is
$10,500/year
(
http://moneycentral.msn.com/content/Retirementandwills/Playingcatchup/P34625.asp
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7/24/04)
 One dollar can be spent today or
sometime in the future
• 23% of all workers are very willing to cut back on
current spending to save for retirement
• 38% are somewhat willing
• 19% are not too willing
• 15% are not at all willing
• Are you among the 34% unwilling to curtail spending
for retirement?
Source: Retirement Confidence Survey® 2004 (not all responses were given)
• “Earlier this year [2005], Fidelity [Investments] said that,
based on the current rate of savings, the average American
household will live on 59 percent of pre-retirement
income once they stop working.” “A third of U.S. workers retire
late, lack savings,” Wed Aug 24, 2005, Reuters
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 Reasons not to save:
• Present pleasure
– “He who loves pleasure will become
poor, whoever loves wine and oil will
never be rich.” Prov. 21:17
• Misunderstanding
– “I’m not supposed to worry about
tomorrow.” But “The prudent see
danger and take refuge, but the simple
keep going and suffer for it.” (Prov.
27:12).

52
Reasons not to
save:

• “I have too much debt to be able to save.”

– Go on a survival budget. Spend only what you must
to survive and pay down debt.
– Pay off your smallest debt first and work up.

• Laziness
– I’ll start when things aren’t as tight.

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 Reasons to do nothing:
• I can’t budget.
– You can budget. Only my wife likes to budget. The
alternative is to spend without a plan. Only the very
wealthy can afford that.
• I can’t save.
– Unless you are devoured by debt, you can save, if
you want something in the future badly enough.
• I’m beyond hope.
– I’ve never seen anyone in about 20 years of
financial counseling who was beyond hope, or who
had to file bankruptcy.

54
 Saving

•We are far more concerned about having

good credit—the privilege to accumulate
more debt--than about saving.
•In June 2005, the US consumer savings rate
was 0%. http://money.cnn.com/2005/08/02/news/economy/savings/ Accessed 8/27/05
•Even “breaking even” is foolish (Prov.
21:20). Why?

55
1 http://www.bea.doc.gov/bea/newsrel/pi1201.htm, Department of Commerce, accessed 2/5/02
Saving
• The Spirit can put to death the desires
of the flesh (Rom. 8:13).
Irresponsible spending is a
“spiritual” problem.
• We save against future “evils” (Prov.
22:3, 27:12) such as breakdowns and
disability.
• An emergency fund of at least 3-6
months income is prudent.
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Saving
• Know why you are saving.
• You need an emergency fund to cover potential major
expenses. They should be expected.
• Appliance or major system failure in the home.
• Medical, dental and other un-reimbursed expenses.
• Cash for national emergencies
• Large auto costs/replacement costs
• Track how much in savings is for a particular purpose
• Other savings goals:
• Inheritance for children/grandchildren (Prov. 13:22)
• Retirement and old age care—The average SS
payment is about $10,500/year
http://moneycentral.msn.com/content/Retirementandwills/Playingcatchup/P34625.asp 7/24/04

• Kingdom funding
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Saving
• To make it harder to “raid” your savings,
make it harder to access.
• Automatically debit your checking account to
savings at a bank account hard to access.
• Automatically debit your checking account to
invest in the stock of a solid company
through a dividend reinvestment plan (DRIP).
Such stock purchases may cost little or
nothing. Visit www.DirectInvesting.com for
details on how to establish this account.
58
Saving
• Establish a “ladder” of savings.
• Begin with a passbook savings account.
• When you have sufficient funds, transfer it to an
out-of-town money market account with low fees
(such as Vanguard Prime Money Market Fund).
• From there move into higher-paying investments—
bonds, CD’s if interest rates are high, mutual funds
and stocks, or into tangible investments such as
land.
• Try to save at least 10% of your gross
income. You only think you are saving if it is
not there at the end of the month.
59
Saving
• Social Security is solvent only until
20411. Expenses will exceed income
by 2017. Today 3.3 workers contribute
per 1 retiree—it will be 2.2 by 2030.

• http://www.ssa.gov/pressoffice/pr/trustee05-pr.htm, accessed 4/15/05

60
• The earlier you save and invest the
better. If you start investing $2,000
annually at 8% in an IRA at 25, you will
have $606,487 at 65. If you delay until
35, you’ll have only $266,427, a loss of
$340,0601.

1 Dean O. Webb, “Don’t delay, start saving today,” Christian Financial Concepts, Money Matters, 10/99, p. 3

61
 Retirement
 The only mention of retirement is at
Numbers 8:25-26a, where priests were to
retire at age 50, probably due to physical
depletion (see Eccles. 12).
 If you live to 65, you’ll probably live to 831.
 First, be “rich toward God” (Lk. 12:21),
unlike the rich fool who tried to construct
heaven on earth.
 Ask God what standard of retirement living
He wants you to have, then plan toward it.
62
1 www.cdc.gov/nchs/fastats/lifeexpec.htm, accessed 4/17/02
PLANNING WITH
YOUR SURPLUS
• God’s plans never fail (Is. 14:27; Ps. 33:11),
so we need to try to understand God’s will
(Eph. 5:17; Jer. 9:23-24).
• Planning is “spiritual” (Prov. 12:5; 16:3)
• Get good counsel (Prov. 12:15; 13:10)
• God can will in our will (Phil. 2:12-13)
• “What has God given you faith to believe
Him for ?” Bill Gothard
• Try constructing a financial timeline, using 70
years.
63
TWO APPROACHES
TO SPENDING

• From a false assumption

• of what “ought” to be able to spend.
• “I owe it to myself!” “I deserve to be able
to ….”—a deductive approach
• From actual income/provision
• From within the circle of God’s provision
—an inductive approach 64
Income usually isn’t the major
issue in budgeting
• Here is a list of the nations with the
highest percentage of consumers who
have no spare cash: 1—America (22%)
1—Portugal (22%) 3—Canada (19%) 4
—United Kingdom (17%) 5—France
(16%) 6—Netherlands (15%) ACNielson Online
Consumer Confidence Survey—Global Survey, 1/11/2005

• But godliness with contentment is great gain--1

Timothy 6:6

65
 HOW TO BUDGET--
7 STEPS

1. Pray for wisdom (James 1:5) and for self-

control (Galatians 5:23). Habitual
overspending is a spiritual issue.
2. BEFORE spending, plan MONTHLY
expenses and LONG TERM GOALS
(greater than 1 year, requiring savings).
3. Record DAILY expenses in a ledger or
software program—keep a running total in
each expense category (using the ledger or
on the outside of a cash envelope).
66
 BUDGETING STEPS
4. At month’s end, TOTAL expenses in
each category and compare with
target figures, and adjust for next
month, if needed.
5. Compare ALL expenses and with ALL
income.
6. Move any surplus to savings,
earmarking it for a particular need.
7. Deduct any shortfall from your next
pay before spending it. 67
Go to
www.crown.org/Tools/budgetguide.asp
to find percentages for
each category for your
income.

Budget busters:

Print this form at 68

www.rmni.org/financial/income_and_expense.pdf
 Typical Budget Problems -1
Spending over 40% of net spendable income
(gross income, less taxes and giving) for
housing & utilities
Long distance/cell phone bills too high
Tip: use www.OneSuite.com
Food category out-of-control, including eating
out Tip: shop from menus
“Over-recreating,” including cable, trips and
fitness clubs Tip: spend from envelope
Paying too much for auto insurance & having
inadequate life insurance
69
 Typical Budget Problems -2
High debt load and failure to even list and
total all debt Tip: debt list at
www.rmni.org/financial/debt_list.pdf
Little or no savings—failure to plan for
future needs and goals
“Miscellaneous” spending out-of-control
Unable to pay for private schooling
Putting too much or too little into
retirement investments
70
 Typical Budget Problems -3

• Little giving to Christian causes & too

much giving to relatives
• Inadequate or inordinate tax deductions
• High cost of health insurance—consider a
good Christian health cooperative: see
www.samaritanministries.org

71
 Budget Balancing
How do Americans try to balance their
budgets?
• Cutting down on take-away meals—
66%
• Saving on gas and electricity—61%
• Cutting back on out-of-home
entertainment—60%
• Spend less on new clothes—54%
• Not driving as much—47%
• Switching to less expensive grocery
brands—42% ACNielson Online Consumer Confidence Survey—Global
Survey, 11/2005
72
 BUDGETING TIPS
At year’s end, total all expenses for each
category and divide by the number of months
included, to refine your budget figures.
You will probably have to adjust your budget
each month if your income varies (using a
computer spread-sheet helps). See:
www.rmni.org/financial/budgetsheet.asp

73
 More BUDGETING TIPS
• Expect UNEXPECTED expenses. Satan
will try to discourage you. This is the
reason for an emergency fund. The budget
may take at least 6 months to begin to work
smoothly.
• If you use software (Quicken™,
Money Matters™, or MS Money™), use
both a checking account (checks & debit
cards) AND a “cash” account, then combine
them when running reports. You may also
need a credit card account (if you pay them
off each month), and again, combine
accounts for a report. Using software
makes tax season fairly simple. 74
FINANCIAL STATEMENT
As of_________________

(Courtesy of Christian Financial Concepts, Inc.)

Visit the Financial Ministry section of www.RMNI.org
ASSETS
Liquid Assets[1] LIABILITIES[2]
___________________ $____________ ___________________ $___________
___________________ ____________ ___________________ ___________
___________________ ____________ ___________________ ___________
___________________ ____________ ___________________ ___________
___________________ ____________ ___________________ ___________
___________________ ____________ ___________________ ___________
Total liquid assets $____________ TOTAL LIABILITIES $___________

Invested Assets[3]
___________________ $____________
___________________ ____________
___________________ ____________
___________________ ____________ NET WORTH $__________
___________________ ____________ (Total Assets less Total Liabilities)
___________________ ____________
Total invested $____________

Use Assets[4]
___________________ $____________ TOTAL LIABILITIES
___________________ ____________ AND NET WORTH $___________
___________________ ____________
___________________ ____________
___________________ ____________
___________________ ____________
Total use assets $____________
TOTAL ASSETS $____________

[1] Cash, Savings Accounts, Checking Accounts

[2] Outstanding Real Estate Loans, Credit Cards, Auto Loans, Personal Loans 75
[3] IRAs, TSAs, 401ks, Investment, Real Estate, CDs, Antiques presented at fair market value.
[4] Residence, Autos, Personal belongings presented at fair market value.
 www.Crown.org

To find out how to join a 10-week

small group Crown Ministries
financial accountability group, call
800-722-1976.
– For the Chattanooga, Tenn. Area, the
contact person is Jennifer Helton, CPA,
423-580-0105
crown-chattanooga@comcast.net

76
 Are You Ready to Invest?
• Is consumer debt (non-mortgage)
paid? We should not tell creditors to
wait for their money (Prov. 3:27-28).
• How is your emergency fund?
• Are you adequately insured (auto,
home, health, life)?
• Can you invest without debt?
• Do you know your investment goals?
• What is your toleration for risk and
your freedom to risk?
 Pre-investment Principles
• The best investment is in God’s
Kingdom. The return is guaranteed
and nothing can diminish the
principal (Luke 12:33).
– Do I believe that God will reward the
generous, or am I building my own
heaven on earth?
• By application, the parable of the
talents indicates that we should try
for the best return on investments,
consistent with biblical
ethics (Matt. 25:14-28).
 Solomon’s Principles

• Solomon, of incredible wealth,

counseled to be vigilant with the
wealth we have (Prov. 27:23-27).
– Investing requires ongoing scrutiny.
– Money takes wings (Prov. 23:5).
• Don’t try to “get rich quick” (Prov.
23-4-5). In fact, don’t try to get rich
(1 Tim. 6:9). This is an American
heresy.
 Solomon’s Principles
• Spread risk (Eccles. 11:2, 6).
– Buy mutual funds.
– Diversify—among size of companies,
between stocks (equities) and bonds
(debt), or among geo-economic spheres or
kinds of economies, etc.
• Gain understanding, even if costly
(Prov. 4:7). Libraries of investment
information are on the Internet.
Investment books, magazines and
newsletters abound.
Investment Strategies
• Own your home debt-free—a
retirement foundation.
– Mortgage calculators, etc. are at
www.mortgage-calc.com
• Invest while young, so you can
tolerate greater risk.
– With age, risk should decrease.
– Bonds generally become a larger
part of the portfolio with age.
Sources of Understanding

• Invest in areas you understand

(Larry Burkett). Gain information.
• Crown Ministry www.Crown.org
Christian financial resources
• The Motley Fool has online
courses & glossary www.Fool.com
• http://MoneyCentral.msn.com
Very current information
 Selecting Mutual Funds
• Sound Mind Investing Newsletter:
www.SoundMindInvesting.com
– Currently about $8 per month for web
• www.Morningstar.com Great rating
system, current articles and a free
“university.”
• Use Morningstar ratings—5 stars is
best, (top 10% of sector). Your
library may have a subscription.
 Some Mutual Fund Types
• Index funds match indexes—such
as the S&P 500 (500 biggest
companies1), and the Russell 2000
(small companies).
• Large capitalization funds invest in
companies of about 10 billion in
market value, mid-cap in
companies of 1-10 billion1 and
small-cap in smaller companies.
1 www.fool.com/school/Glossary
 Some Mutual Fund Types
• Risk increases as company size
decreases. Having some stock in
each (large, mid, small cap)
category is good diversification.
• Generally there are “value”
funds/stocks, good for current
price, and “growth” funds, with
potential for company earnings1.
“Blend” funds combine both.
Growth funds have greater risk.

1 www.fool.com/school/Glossary
 Buying Stocks
• “Sector” funds invest in specific
areas, such as technology, real
estate, energy, pharmaceuticals,
etc. Risk increases as the breadth
of investment decreases.
• “No-load” funds do not charge a
commission, but do have
administrative expenses, and are
preferable to “loaded” funds.
 Buying Stocks

• You can purchase stocks through

discount brokers, such as
Sharebuilder, Ameritrade or Datek,
or through brokers offering
investment advice.
– www.sharebuilder.com
– www.Ameritrade.com
 Retirement Plans
• Company 401-K’s and 403-B’s (for
non-profits) offer tax-free
accumulation of any earnings and
shelter current income.
• Particularly good are employer-
matched funds.
• Beware of over-concentration in
an employer’s stock.
 Retirement Resources
• www.quicken.com/retirement/planner
• Vanguard Group—IRA’s, etc.
http://flagship2.vanguard.com/
• CNN/Money http://money.cnn.com/ Do
a site search on “retirement.”
• Social Security www.ssa.gov
• 401k plans www.psca.org
Estate Planning Resources

• Legal information www.nolo.com

• National Network of Estate Planning
Attorneys www.netplanning.com
• www.elderweb.com Elderly issues
• Deloitte & Touche Financial
planners www.deloitte.com
 What if your personal
income rises?
¤ Will you spend it upon yourself and your
family? Are you a bucket or a funnel (L.
Burkett). Will you give at least a tithe of
your income to the work of God? Or will
more money lead you away from God
(Matt. 11:14)?
¤ Will you be more generous and better
steward of your life and gifts, or simply
enjoy personal financial freedom with a
focus upon this life?
 African American Personal
Finances

¤ As of February 2006, African

Americans had an annual buying
power of 762 billion dollars (expected
to rise to 981 billion by 2010). “The US African
American Market” MarketResearch.com http://www.allheadlinenews.com/articles/7002523834
accessed 1/8/07

¤ Black household contributions were

1.9% of expenditures in 20031.
Telephone services were 2% and
insurance was 2.5%.
1 Target Market News
What if income increases to
your church?
¤ Will the church spend it upon its
own people, upon African
Americans, and ignore the global
Kingdom of God?
¤ Do we care about the 37,000
people who God didn’t wake up this
morning, who never even had a
chance to hear of Jesus Christ?
 OK, What Is Left to
Do?
¤ The number of unevangelized people by
mid-2007 is 1,850,402,000, which is 28%
of the global population. As of mid-2007,
there are 4,420,319,000 non-Christians on
the planet. Of these, Muslims total
1,359,745,000, Hindus total 888,300,000
and Buddhists total 382,482,000. Muslims
and Hindus both have a higher growth rate
than the general Christian population, due
to higher birth rates.
¤ David Barrett and Todd Johnson “Missiometrics 2007…” International Bulletin of Missionary
Research, Jan. 2007, p. 32.
1 From “Annual Statistical Table on Global Mission: 2002,” International Bulletin of Missionary Research, Jan.
2002, p. 23
 Priorities
¤ Ghana sends 500 missionaries per year.
Her population is 22.1 million and her
Gross National Income is 10 billion. African
Americans spent 10.7 billion on household
furnishings and equipment in 2004. Nigeria
sends 2500 missionaries per year and has
a Gross National Income of 74.2 billion
dollars. African Americans spent this much
on vehicles, insurance, clothing and gifts in
2004. Sources: The World Bank:
http://devdata.worldbank.org/external/CPProfile.asp?PTYPE=CP&CCODE=GHA
¤ http://devdata.worldbank.org/external/CPProfile.asp?PTYPE=CP&CCODE=NGA ; the World
Christian Database and Target Market News http://targetmarketnews.com/BuyingPower05.htm
¤  
 A Traditional Black Church
and Global Missions
¤ One traditional church in Chattanooga
with a budget of $120,000 spent .4 %
on evangelistic home missions (to
blacks).
¤ This church spent NOTHING on global
missions. More was spent on the
annual men’s breakfast and on the
copy machine than on missions.
¤ What percentage of your church
budget goes to cross-cultural/global
ministry?
 Perspective:
¤ “The tragedy is that after we are born again, we
can build upon the Rock things that are going to
be consumed, so that after we have stood before
the Lord Jesus Christ as Judge we have little left.
This is a danger not only to businessmen but to
missionaries and ministers, not only to
individuals but to congregations and
organizations. By God’s grace, let us not be
infiltrated by the values of affluence and personal
peace. Let us use the treasures God has given us
in such a way that when we come to that day we
will have treasures laid up in Heaven and people
eagerly waiting for us.”
¤ Francis Schaeffer, No Little People, ISBN: 0891073345, 3:191.
 Will Generations of African
American Christians be Lost to
Stuff ?
¤ Since the early 1980s, Black income has
been rising. African Americans finally have
an opportunity to achieve the American
Dream, to have “a piece of the rock.”
❍ If we focus upon accumulating stuff, that will
never satisfy.
❍ “Whoever loves money never has money
enough; whoever loves wealth is never satisfied
with his income. This too is meaningless.”
Ecclesiastes 5:10 NIV
❍ All Christians should seek first the Kingdom, not
prosperity. Where our treasure is, there is our
heart (Matt. 6:21).