Being a Responsive Steward
Overcomers Resource
Important Guidelines for Managing Finances
- Put your current financial picture in writing
- Set goals and put them in writing
- Understand where your money is going
- Giving - Start giving to your church regularly.
- Become Debt Free
- Establish an Emergency Fund of an amount to cover 6 months of expenses
- Save 8-10% of your income for Retirement & life uncertainties.
- Three most important tools: Sacrifice, Discipline, and Organization.
The definition of Financial Planning..... the continued, predetermined, allocation of limited financial resources to unlimited, changing alternatives. Simply stated - limited amount of money and unlimited amount of places to allocate it (spend, save, pay off debt, give, etc.).
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Application of these guidelines:
1.Understanding your Financial Picture Put it in Writing- Click Financial Readiness Plan
A. What you have (your financial assets, home, other valuables)
B. What you owe (list the debt and the terms of the loans)
C. Current Insurance policies (life, health, disability, health)
2. Setting Goals and Priorities - put it in Writing.
A. Understand how you view money.
- Are you a spender, saver, hoarder, etc?
- Do you fear money?
B. Following God's will with your money takes Sacrifice, Discipline, and Organization.
C.The most important steps must come first - Survival Money, Safety Money, and Freedom Money.
D. Put your goals in writing
3. Budgeting - "Be sure you know the condition of your flocks, give careful attention to
your herds; for riches do not endure forever" (Proverbs 27: 23- 24).
Your income has 5 places to go. No decision is independent of another. If you spend more, then you have less to save, pay down debt or give. Ultimately, we want to minimize taxes, eliminate debt, save adequately,and give.
A. Plan your expenses - click on Overcomer Budget. Complete the sheet based
on where you believe your money is going and how you plan in to be spent each month.
B. Track your expenses - click on Overcomer Budget Tracker. In keeping track of your daily, weekly, and monthly expenses you will be able to hold yourself accountable to the budget. The monthly budget may need to be tweaked through this process. You may realize that you are spending too much money in one area or another. You may be able to save in one area and use the extra money to pay off debt, build up the emergency fund, save for retirement or give more to Kingdom and other worthy causes.
4. Giving -
Start giving now, even if it is very little. Our habits are formed by doing. Give now. Give regularly.
Being responsive stewards, we understand that God owns 100% of the resources we have.
The widow gave all she had out of her poverty, not her wealth. (Mark 12:41-44)
"Whoever sows sparingly will also reap sparingly, and whoever sows generously will also reap generously" (2 Cor 9:6)
"If anyone has material possessions and sees his brother in need but has no pity on him, how can the love of God be in him" (1 John 3:17)
"For where your treasure is, there your heart will also be" (Luke 12:31) Giving relinquishes the stronghold to our money. It is a defense against falling in love with money.
Giving is a joy that God has given us.
"He is no fool who gives what he cannot keep to gain what he cannot lose."
- Jim Elliot
5. Debt -
"A man jumped off a twenty-story building. Onlookers were terrified, but the man seemed perfectly calm. As he plummeted by the window of a fifth story apartment, he looked at the wide-eyed occupant and said, "Everything's all right so far."
This story reminds me of the attitude many people take towards debt in its early stages: " Everything's all right so far." But what happens to most debtors later is equivalent to what happened to the man when he finally reached the ground.
Randy Alcorn - Money, Possessions, and Eternity
Debt is never a good thing. Debt = Risk. Understanding Debt
If you can buy it you can finance it. Stay away from this common, worldly view. Look at the problems that this path has made for many Americans today.
Do not file bankruptcy just yet! Read this first - Bankrupcty
6. Saving and Investing -
A. Create a Cushion (Emergency Fund) - this is an amount equal to 6 months of your expenses. The funds should be kept in a liquid account such as checking account, savings account, money market fund, or short term CDs. (see link below)
B. Understanding Saving and Investing Vehicles - (click here)
C. Retirement Accounts - (click here)
Three Stages of Saving
7. Insurance Information
Adequate insurance is a necessity. The purpose of insurance is to transfer risk from yourself (to the insurance company). Of course, there is a cost to this and that is the premium that you pay for the insurance. Therefore, it is very important to make sure that you have the correct coverage for your situation.
A. Auto Insurance
B. Home Owners / Renters Insurance - what if your home is destroyed in a fire or other natural disaster - How will you replace the structure and your belongings?
C. Health Insurance
8. Misc
A. Purchasing a house - Mortgage Options for Bad Credit Borrowers
B. Purchasing a car - Guidelines
C. Opening a Checking Account - How to open a checking account with bad credit
D. Buyer Beware
© 2009, JEH. All rights reserved.
