When it comes to Christian living, there are two areas that each believer must revisit regularly: financial growth and church growth. These things are hard to get right and require constant monitoring.
We weren’t born with a fully developed strategy for financial growth and we weren’t born AGAIN with a healthy concept of church growth and we don’t readily recognize the connection between the two. But they do connect.
- One measures the health of your secular life; the other measures the health of your spiritual life.
- Financial growth provides resources to fuel church growth and growing churches teach people principles for managing finances properly.
We must not neglect these two issues. This post will focus on financial health.
A healthy strategy for financial growth involves three things:
- Earning money
- Managing money
- Making money
Not everyone sees these as separate issues but each one serves a very different and important purpose. This is particularly true when it comes to “earning” and “making” money.
Earning money is usually associated with the word “job” and most every person has one. We get jobs because…
- Everyone has one and we don’t want to be too different from our peers.
- We need a place to live, food to eat, clothes to wear, recreation to enjoy and other “necessities” of life. All of these things require money and the most common and easiest means of earning it, but by far not the best, is a job.
- Jobs can give us a sense of significance. The more ability, skill or experience a job requires the more respect the job-holder (employee) garners. But, even people who perform common functions reliably are recognized for doing so.
But, here is the issue. You might gain an income and even recognition from a job but it can never give you financial security or a life. A job should never be the end goal for several reasons:
- It is tied to your ability to perform consistently. Ability never remains constant and as soon as it diminishes your employment days are numbered.
- It is affected by circumstance. Bad circumstances can develop in very diverse ways, and unexpectedly, any one of which can threaten your job security: economic down turn, personal tragedy, low demand for the particular products your employer provides, heavy competition and so on. Jobs are dependent on things going well.
- A “good standing” is influenced by the whim of your employer. Employment laws provide more protection for employees, from employer abuse, today than ever before but there are no laws that require your boss to like you. Even if you keep your job, if the boss doesn’t like you, opportunities to shine will be few and far between.
- Jobs may not exercise your best capabilities. The bureaucratic atmospheres in which jobs exist don’t always allow the cream to rise to the top and the best ideas aren’t always heard. You may have a nice pay check in one hand and a stunted life in the other. The pay check, unfortunately, won’t last.
- Jobs dictate lifestyle. High paying jobs usually come with a high priced standard of living. You aren’t allowed to live down. The home, car, social agenda and children’s upbringing must all reflect the status associated with your job, which means even your expendable income is controlled by employer expectations.
Managing money is totally different to earning it and the activity most often associated with this exercise is “saving.” Every sensible person does it.
We save, 1) because we know certain expenses are inevitable and the best way to prepare for them is to save and, 2) we don’t know the future and must prepare for even the worse case scenarios like a job loss or serious illness.
Some standard saving categories are:
- Emergency fund (enough to cover expenses for six months SHOULD YOU LOOSE YOUR JOB)
- Maintenance fund for unforeseen but inevitable expenses (car, house, medical, etc.)
- Holiday fund
- Mad money fund (for times when you need to get away or just go out to eat)
- Special occasions fund (anniversaries, birthdays, graduations, educational funds)
- Retirement fund
All of these categories are capitalized by money left over after living expenses have been met so frugality becomes important. This is one reason living down is a serious part of any financial strategy.
The standard of living expected with certain jobs, along with servicing the educational debt incurred while getting qualified, leaves very little money to work with. At this juncture ideas like “cash flow” take a back seat in anticipation of higher “standards of living” and for that reason financial strategy is left unattended and stalls out.
Saving under these circumstances is more out of necessity than it is strategic. People fail to save with discipline or direction because they don’t see beyond the next pay check or the next unexpected expenditure.
In fact, the most important category of all, “investment,” is not found on most lists. Retirement funds are not investments. They provide a bit of financial padding for the future and little more. Because they are very susceptible to market volatility they may not provide that. Following is an excerpt taken from CNNMoney.com.
The good news and bad news about your nest egg: You can find ways to make it last, but it’s not going to be pretty.
I’m retired and have lost a third of my savings and a third of my monthly income. I don’t have earnings, so I can’t add new money to my retirement portfolio. I also don’t have enough time to wait for a market recovery to recoup my losses. What can a retiree in my position do? – B.P. Ocala, Fla.
The answer to this man’s question amounted to nothing more than a patch to slow not stop the bleeding.
Money is a tool so spending it frugally and saving some with purpose provides options you wouldn’t otherwise have, like using some to invest in real estate or other opportunities for creating a passive income. And that leads us to the third step in a healthy financial strategy.
One draw back to retirement is your job related income is no longer available and people unprepared for this stage in life may find themselves scrambling just to exist, even with retirement accounts in hand. But, if a person during the working years has used some of their earned income to develop sources of passive income the situation looks much better.
Most people, however, only do what the person in the CNN example did, dump money into a retirement fund.
“Investment” as I use the word would be defined as “any venture you commit capital resources to, along with personal effort, which in turn has the potential for developing an income not associated with your job. It also has the potential to loose money but with due diligence the losses can be controlled and the experience educational.” The income from this venture would be called passive because the venture usually requires less and in some cases no effort from you.
The number of potential investment opportunities is too numerous to mention here but broadly speaking real estate has been a useful investment vehicle throughout history. Robert Kiyosaki has done very well in real estate and also has a series of books detailing how its done.
Another method for generating additional income is network marketing and there are many reputable companies to work with: Amway, Avon, Mary Kay and Tupperware to mention just a few. All of these companies provide reliable products and operate on a sound basis. The ones mentioned have a long history and proven track record.
I am personally involved with Amway and if you have any questions please let me know using the contact form on this site.
People have also used hobbies: carpentry, cooking, computing, coding and blogging to make a little money on the side. These hobbies have become the sole source of income in some cases. A great article giving tips for making money from your hobbies can be found at Get Rich Slowly.
Not every plan will work for you but every plan does work and you’re bound to find one suitable for you.
The problem is not opportunity. The problem is trying and failing. Truth? You will never “make money” without trying and failing, possibly many times.
People also fail to make money because it requires too much imagination. They claim to have no entrepreneurial ability and therefore must settle for only a job. There were times when jobs were not readily available and people who couldn’t find work were forced into thinking entrepreneurially or they went hungry. Don’t be fooled. Everyone has it in them to develop additional streams of income.
Love of Money
Some people never talk about money or strategize ways to increase wealth because they fear what the Bible refers to as “the love of money” which is the “root of all evil.” Well, money can be used to do very bad things and doing very bad things is sometimes a means of getting it but the converse is also true. The good that can be accomplished with the use of money is just as great, if not greater than the bad.
Also, don’t forget the wicked servant who was too lazy to even try to increase his talent. This servant loved money too much to loose some trying to invest it profitably. He wasn’t disciplined, frivolous or cautious. He was lazy and fearful. Not a legitimate attitude to foster.
Following are the ways in which money can be loved and as you can see, it happens in all three stages.
- Doing anything, even wrong things to get it (no principles)
- Excessively hoarding it (stingy, cruel, insensitive, prideful, megalomania)
- Frivolously spending it (hedonistic, aimless)
- Fearing the loss of it (fearful, uninformed, lazy)
- Risking too much of it (impatient, un-thoughtful, careless, presumptuous)
At every stage:
- Failing to be generous (no social responsibility)
Hopefully I’ve said enough to convince you that creating diverse streams of income through entrepreneurial investing is a must for every responsible person. Now, check out the links, do some home work and find the plans that are best for you. It might change your life! Happy hunting!
And don’t forget to tell us what you THINK!AboutIt.