Finances in Tough Times
By Phil McGilvray
As Christians I believe we all hunger to experience God in a real and personal way. It is easy for us to have a head knowledge that God exists and that Jesus died to save us but what we really want is that tangible experience of God’s presence and involvement in our lives. As I was preparing this article I became acutely aware of the power and truth of God’s word on the matter of finances.
God’s power is never more real to me than when I experience it first hand in relation to my personal finances and the finances of my clients. As I prepare this article on ‘Finances in tough times’ I have felt an overwhelming sense of certainty that God’s hand is actively involved in my finances as it is for everyone who chooses to trust and obey him. In relation to financial matters I have had the privilege of seeing His words, His promises, His warnings come to fruition in my life and in the lives of my clients time after time after time.
This leads me to my first point: you cannot keep God and your financial issues separate. In Howard Dayton’s book ‘Your Money Counts’, he talks about the 12th century Crusaders who employed mercenaries to fight on their behalf. Because it was a religious war, the mercenaries had to be baptised before fighting. However as they were baptised the mercenaries would hold their swords out of the water to symbolise the one thing in their life Jesus Christ did not have control over. This gave them the freedom to use their swords in any way they wished. In our affluent culture many if not most Christians handle their money and possessions in a similar manner. This is an absolute tragedy because God wants to be involved in our finances as much as any other aspect of our life, and when we do involve him it is always for the better. Try as we might we cannot keep God and money separate. If you want to improve your financial circumstances you need to first address the spiritual issues that have put a barrier between God and your money then you can start on the practical aspects.
Lets start by looking at the spiritual side of managing finances in tough times.
Firstly, God needs to be number one in your life; He doesn’t want to be third or fourth on the list behind family, work, money, sports etc, He wants to be number one. This sounds obvious and I am sure we would all like to think we do put Him as number one, but consider the following questions:
1) Do I spend more time each day reading His word and praying than I do watching TV or enjoying hobbies?
2) Do I make a conscious effort to commit each day to God and seek his guidance, wisdom and involvement throughout the day?
3) Do I tithe and give God the first fruits of my income no matter how great or small that figure may be?
4) Do I spend more time praying and reading God’s word than I do thinking about my financial situation?
Secondly, you need to know and believe that God has a plan for every aspect of your life and you can be absolutely sure that this includes your finances. Everything about God’s plan will result in the best outcome for you. Nothing you can dream up even comes close to what God has got planned for your life. God’s plan utilises the skills, abilities and resources He gave you to the fullest. While this doesn’t mean a life on easy street, it does mean a full, joyful and deeply satisfying life. I truly believe that God blesses us by providing everything we need to live out His plan for us, including sufficient financial resources.
Thirdly, no matter what happens you don’t need to be afraid because God is in total control.
David Wilkinson, author of The Cross and the Switch Blade and pastor of Times Square Church in New York, has written a lesser-known book called ‘The Vision”. In this book he describes a vision he received from God many years ago of an ‘economic holocaust’ befalling the United States. He does not know when this will occur but is certain it will occur in his lifetime. Without making any judgements on the accuracy of his Vision, David spoke a powerful message beyond his descriptions of calamity and economic ruin- a message the Holy Spirit spoke to his heart immediately after this vision, five simple but powerful words- “God has everything under control!” No matter how bad things might seem, be assured God can see you, He loves you and He is in control.
Finally and perhaps most importantly you need to honour God with your first fruits. I have no doubt that tithing is the key to releasing God into your finances. You may not know how you are going to make ends meet, but this one act of faith has powerful spiritual consequences. Don’t try to second-guess God and how He might provide for you, just do it; you will be amazed at how God can transform your financial circumstances if you just give Him a chance. Tithing is the most practical demonstration of our faith in Him; when we take that step he blesses us with every resource we need to live the life he planned for us.
Now that we have got God intimately involved in our finances we can turn our attention to the practical steps we can take to improve our circumstances in tough economic times.
Firstly, no matter how much you earn you need a budget; a budget is simply a plan for how you are going to spend your money over the next 12 months. A budget ensures you are making optimal use of your income, it ensures the bills get paid and makes sure you never over-extend yourself. Without a budget you have no way of gauging how much you can afford to spend, how much you can afford to save and how long it will realistically take you to pay off debt. Having taught over 300 couples to budget successfully over recent years, I have also come to realise that a budget is a powerful medium for couples to communicate about money issues especially when things are tough. It gives you a constructive forum and frame work with which to discuss your finances. Perhaps most importantly budgeting keeps you accountable for how you are using the money God has entrusted you with.
Secondly, once you have a budget you need to build a cash reserve, an emergency fund for that inevitable rainy day. Any surplus generated from your budget should first and foremost be aimed at building this reserve. If you are single or you are renting this cash reserve should be a minimum of $5,000, if you are a home owner it should be $10,000. This money is typically best kept in an offset account or high interest savings account (but not a redraw facility!).If your budget is tight and saving this sort of cash reserve seems like a life-long task you might want to consider what treasures you might have lying around the house that you could sell using ebay or the local classifieds. You would be surprised when you really look just how much stuff you no longer use that can easily be converted into cash.
Thirdly, once your budget is in place and you have built a cash reserve of at least $5,000 you should focus on paying down debt as aggressively as possible, starting with consumer debt such as credit cards and personal loans. Start with your smallest debt or the one with the highest interest rate - pay the absolute minimum on all other debts and throw all extra energy at that one debt. Once the first debt is gone focus on the next one- this has a snowball effect both psychologically and financially. If you are now successfully living to a budget and have a home loan I encourage you to meet with a trusted mortgage broker to see if you can refinance your loan at a lower rate. If you have consumer debt left over from your pre-budget days you may also consider consolidating this debt into one loan and if things are really tough opt to go interest-only on your loan for a time.
Finally don’t be afraid to sell assets, ie., shares and or investment properties to help free up some cash. Too often I see people struggling to make ends meet while desperately holding onto an asset because they don’t want to give up on their dream to build a better future, to build a property or share portfolio - they have become slave to their assets. I am all for sensible long-term wealth creation but if it comes at the cost of quality of life now you have got your priorities all wrong.
God has written the instruction manual for how we should live every aspect of our lives; this includes our finances. If you are doing it tough financially, now is the time to give your struggles to Him. You might not know how He can resolve your financial issues but be assured He is standing by waiting for the opportunity. There is never a better time to start doing things God’s way.
As hard as we might try to keep God and our money as separate issues they are inextricably entwined
“For I know the plans I have for you says the Lord, plans to prosper you and not to harm you plans to give you hope and a future”- Jeremiah 29:11.
Phillip McGilvray B.App.Sci(OT) M.Ex&Sp.Sci Dip.FS (Financial planning) and wife Lianne and their three children live in Canberra, where they present their God, Marriage and Money workshops.
