Last week I teased that aside from hoping to strike it rich with a miracle investment, there was a better route to go. Here is my brilliant three-step plan:
One: Earn More
Dave Ramsey teaches that your most important wealth building tool is your income. To build wealth, you need to generate income. Saving money (income minus expenses) and investing (return on saved money) are impossible without generating income. Obviously more income increases your chances (but certainly doesn’t guarantee) of having a surplus. If we aren’t currently generating a surplus, we need to either (or both) cut expenses and/or generate more income. Here is some advice on generating more income.
Two: Get rid of Debt
Getting out of debt accomplishes two super important things. First, you take over control of your income. Debt is a lien against your future income. Take control of your future income – it will allow you to save which is step one in accumulate wealth. Second, if you are paying interest on debt, you can have a guaranteed return on an investment by keeping that interest for yourself. See this.
Three: Save cash
This seems counter intuitive, but having a large cash reserve is valuable for several reasons. First, you can negotiate significant discounts on things you are forced to buy. Second, you are prepared when assets that we know and understand become significantly discounted. Like when we get our next recession. There is a lot more to be said about the advantages of liquidity, but I recommend trying it to see how it feels.
Concession from last week. While I’m steadfast that we should let go of the myth of being a great investor, it’s really important to understand that yielding a couple of extra percent yields a massive difference in returns over time. Over 20 years, the difference between earning 6% and 12% on an investment isn’t 2x the return, it’s 3x. This goes up even more over time and/or return.
Our country loves the “Horatio Alger” story – the old rags to riches. In our culture, one of the most popular narratives to riches is through being a great investor.* If I can figure out the market, I’ll be able to see something others don’t and it will make me wealthy. Warren Buffett is the hero of this story. I poured through his biography (The Snowball, 832 pages!) when it came out looking for secrets and clues. One potentially controversial belief I’ve developed:
I don’t believe being a “great investor” is a reasonable path to wealth.
We need to let go of the myth that we are one hot stock tip away from financial success. This narrative is baked into our entire culture. TV networks like CNBC and Fox Business are built on this myth (Here is the 8 best TV shows ranked by a website dedicated to investors). Entire print industries (Money magazine, financial help books) have this narrative intertwined in their unspoken promise to the reader.
I’m convinced it doesn’t work and in fact it’s a massive waste of time and distraction from actually accumulating wealth. Why? Here are three of many reasons:
- Not enough initial capital
A friend of mine recent came and asked for some advice on which stock to buy with a $1,000. I didn’t have the courage to tell them it didn’t matter. Warren Buffett, the wealthiest person in America and perhaps the best investor in our history has earned around 20% compounded return. Maybe you’re a better investor then Warren Buffett, but if you’re as good as him in 10 years your $1,000 will be worth $7,268.
The point is that most of us don’t have enough upfront capital to take advantage of outsized returns, even if we were to get them. Does this mean we shouldn’t save or make wise investments? Of course not. It should pop the bubble that I’m only one key investment away from financial freedom.
There is a huge separation between how it feels for my $1,000 to be up (or God forbid down) 8 points this morning and the actual impact that will have on my life. That’s why some of the best investors don’t follow the market or invest in individual stocks. That’s why it “doesn’t matter”. There are a dozen other more important financial decisions each month that will affect my financial future far more than the short term fluctuations a $1,000 investment.
- Have to live on the returns
My dad went to a three-day seminar on how to use stock shorts and options to make a killing in the market. One major problem (beside the fact that nobody actually “beat’s the market”) is that if my dad did this from home he’d still have to pay for his regular living expense from his earnings. For example, if he earned 20% on a huge sum of money like $250k, he would clear about $50,000 in income before taxes. The problem is that he’d use most of that money up, you know, eating and stuff. It would make it almost impossible to actually accumulate wealth unless you had your living expenses covered by an actual income or you had some amount of money large enough ($2M+) that $50k wasn’t a significant deduction from returns.
Another example. People have asked me about real estate investing. I think it’s a wonderful investment, but unless you have a significant amount of capital don’t plan on making a living doing it for many years. It’s a great side job, but if you’re living on the returns it’s a poor way to accumulate wealth. In fact, almost everyone I know that has done well in real estate has done it by working (improving, changing use, managing, etc.) rather then passive investing.
- Not really an expert
This one hurts a little. My pride tends to try to convince me that I know more then I really do. I’ve noticed that the professional investors from books like The Big Short and The Snowball spend a tremendous amount of time and attention learning their craft inside and out. I know several professional investors personally, and I’m continually taken aback by how much they put into understanding each investment. Even after exhaustive consideration, they build investment models around the inherent acknowledgement that they will be wrong some of the time.
If someone says you should invest in such-and-such because the kids are using it or something, I beg you to stay away. Virtually all public information is trash. One of the core tenants of all investing is “Invest in what you know”. Being honest about what I really know isn’t easy, but it will save me a lot of dashed expectations and refocus me back on activities that pay huge dividends.
Next week: If you aren’t going to waste time/effort/dashed expectations chasing the next great investing tip, what should you do instead?
*This rags-to-riches through a great investment is woven into our DNA across all cultures. Jesus told a popular parable about this with a twist – investing everything you have to acquire the truest treasure of life.
“If a defining characteristic of the modern world is disorder, then the most fundamental act of resistance is to establish order. If we don’t have internal order, we will be controlled by our human passions and by the powerful outside forces…”
That quote opens Rod Dreher’s discussion on Order – one of the Rules for Living in his latest book The Benedict Option. As I read the book, the intersections of our personal finances and living a counter-cultural life are everywhere. Some obvious (forgoing materialism for simplicity), some subtle.
One common characteristic of people that win with money is that their personal finances are in Order. It doesn’t have to be a fancy system. It doesn’t have to be electronic with spreadsheets and apps. It doesn’t have to be super nerdy with detail down to the last penny. However, people that win with money have their “house in order”. They display what the author of Proverbs called “diligence”.
It might be infinitely practical; I might need to track my spending in writing. Maybe create a file folder for next year’s taxes. Do a simple budget every month. Balance my checkbook. These are all examples of creating a life of order.
It can also be a grand vision of my place in the universe. Dreher highlights three understandings of order:
- Discovery of The Order, the logos, that God has written into the nature of creation and seeking to live in harmony with it.
- Realization of natural limits within Creation’s givenness, as opposed to believing that nature is something we can deny or refute, according to our own desires.
- Disciplining one’s life to live a life to glorify God and help others.
This week, if it is as grand as seeking to live in harmony with the universe or as imminently practical as opening and processing all our mail each week, lets seek a life of order.
I had a chance to interview David Hyams, a Denver Seminary graduate and current practicing attorney. You’re really going to enjoy his wisdom – especially his personal story of navigating student loan debt.
David, you have a unique background – you are a practicing attorney but you also attended and graduated from Denver Seminary. Why did you pursue those seemingly very different directions?
The short answer is, because I was trying to follow God’s call on my life. What this looked like in reality, of course, was a serpentine path to law shrouded by fog, marked by stints of clarity. My undergrad degree is in Sport Medicine, which was never a good fit, but when I chose that major as a freshman, like most 18-year-olds, I didn’t know myself and certainly was not considering career options in terms of God’s calling on my life. Toward the end of college, I fell in love with Jesus and apologetics, which led to seminary. While at D. Sem., I learned my giftings trended more academic, so I pursued the M.A. in Philosophy of Religion. Upon finishing that degree, despite numerous red flags cautioning me otherwise, I was convinced a Ph.D. in Philosophy was what God had for me. Toward that end, I picked up another M.A. in Philosophy from Georgia State University. Eventually, in a most unfamiliar and uncomfortable act of humility, I surrendered to what the Lord had for my career instead of imposing on Him what I thought “made sense.” That led to law school, which wound up being a perfect complement for my background and giftings. In fact, I’ve met quite a few seminarians over the years who’ve entertained the prospect of attending law school, and lawyers who’ve wanted to go to seminary. Few have had the privilege of doing both. Thus, becoming an attorney was not the product of a planned career path, but was the result of my (highly imperfect) attempts to daily follow the Lord’s whispers.
You and I have talked briefly about your personal interaction with student loans. I know you have really sacrificed to pay those down – what has your journey looked like?
I’m not proud of my journey. Had I to do it over again, it would look very different. Nonetheless, if through my weaknesses and the ensuing suffering Christ’s power may rest upon me and others may be comforted (see 2 Cor. 12:9; 1:3-4), I gladly share it.
Thankfully, my personal interaction with student loans stemmed solely from my law degree. My parents paid for the B.S. We paid for seminary through a combination of work (my wife and I both worked, though she was the primary breadwinner), scholarships, and church contributions. The second M.A. was paid for through work (again, my wife mainly supported us, though I worked as well), and grants from the university.
By the time I started law school, however, we were burned out on school and were ready to cast off the shackles of financial restraint we had worn for the years of student life and start living like “grown ups.” Thus, despite having very good jobs for the duration of law school, instead of using our income to actually pay for tuition, we financed the entire degree with student loans. (For brevity’s sake, I’ll skip over the multitude of other financially-ruinous decisions we made over the next several years and focus on the loans.) I thus graduated from law school in 2008 with approximately $125,000 in student loan debt.
Aside from the sloth, prideful sense of entitlement, and utter foolishness that informed the decision to borrow all that money, I never once stopped and put pen to paper to determine the answers to such basic questions as:
“How much money am I going to have to make each month in order to pay these loans back in x years?”
“If I don’t pay at least $x per month, what is the interest going to do to the principal?”
“What sort of jobs am I either going to need to apply for or walk away from because of my obligation to service this debt, and how does that align with God’s call on my life?”
“What sort of opportunities am I not going to be able to pursue because of the commitment I’m making to my lender?”
Instead, in repeated acts of cowardice, I stuck my head in the sand and, semester after semester, took on more and more debt. Of course, I never abandoned my faith along the way, so, on those rare occasions when I’d actually entertain post-law school financial realities in a general sense, I would sanctify my naivety with such theological quips as, “I don’t know how, but God will provide.” (All the while ignoring that God was actually providing the entire time, I was just choosing to squander his provisions.)
After narrowly avoiding personal bankruptcy following law school, we went through a major life overhaul and (finally) started living on a budget. After eight years of attacking debt, belt-tightening, and the selling of two houses in 2016, we are, praise be to God, debt-free. The student loans had ballooned to ~$165,000, for I had put them in deferment and had entered into a federal “repayment program” while I repaid other debts. And while we’re now starting over in some ways, we’re finally complying with the Lord’s command in Romans 13:8 to owe no one anything except love. It feels amazing.
Financially, what word of advice would you give to someone just entering into seminary?
Generally speaking, you need to understand that, while the degree you’re about to earn is extremely valuable and worthwhile from a kingdom perspective, the world does not place the same value on it. And, by and large, the world’s value metrics determine the amount of money you will earn upon exiting seminary, regardless of your place of employment. And while it may feel a little “dirty” to the seminarian who is dutifully following the call of God on his or her life, they need to get comfortable talking about money and the financial realities that come with it. The last thing you want to do is in one breath say, “God, I will go anywhere and do anything you call me to do,” and in the next breath say, “so long as it pays at least $x per month because I’ve got to pay these student loans back!” At its most basic level, taking on student loans is taking on the yoke of another master, and the Lord has warned us about the feasibility of serving two masters (Lk. 16:13)—especially when that other master is Caesar himself (i.e., the federal government)). Moreover, many (most?) of the life crises of the people you’ll be ministering to involve finances in some capacity.
Moreover, you have no idea what will happen in life. Yes, God will provide for your needs. And yes, He owns the cattle on a thousand hills. But this world we live in is fallen and suffering and persecution is a part of the path of righteousness. Why purposefully compound that by fiscal irresponsibility?
Accordingly, I’d advise the seminarian to avoid student loans at all costs. If need be, take your time getting through seminary. (For most of you, being older and wiser upon exiting seminary will only help your future ministry.) Get creative by working multiple jobs (even jobs that might be “beneath” you), take night or weekend classes, check your textbooks out from libraries, live on a budget, beg, pinch, scrape, whatever, just stay indebted only to the Lord.
You have a unique background in Bankruptcy law. I believe one of the biggest issues with large amounts of student loans is that personally you can’t bankrupt out of them. That makes it almost impossible to escape them should you become overly indebted or should life change radically. Obviously bankruptcy has been abused by some people over the years, but can you help us understand why it’s important to our economic process and what risks someone takes by taking on non-bankrupt-able debt?
In its simplest form, bankruptcy is about the unmerited forgiveness of voluntarily-incurred debt. As people of the gospel, we should be able to appreciate this, especially given bankruptcy’s biblical roots in the year of jubilee (see Lev. 25). By allowing a debtor—whether an individual or a company—to make a “fresh start,” risk-taking activity is encouraged. Starting a business, pursuing an idea, investing in something you believe in—all of these are risks. If failure would result in a lifetime of inescapable debt, fewer people and companies would be willing to take risks. Thus, fewer jobs, inventions, and fulfilled dreams, i.e., less human flourishing. Bankruptcy allows the risk-taker to minimize her risks by providing a means to discharge or reorganize her debts in the event of financial calamity. Likewise, creditors are encouraged to invest in the risk-takers, for their rights are protected under the Bankruptcy Code as well. Of course, certain types of debts are offered very little protection, but most creditors will work the prospect of bankruptcy into their pricing and they understand the risk of participating in the market.
By taking on debt that cannot be discharged in bankruptcy, such as student loans, the debtor is taking on the risk that, despite Jesus’ promise that we will face trouble in this world, “everything is going to work out.” Unlike other debts where the debtor and creditor share the risk and therefore want to see the debtor succeed, student loan creditors bear virtually no risk by extending the loans to the particular student. The student bears all the risk, the debt is completely unsecured, i.e., the debt does not attach to any collateral that can be liquidated to satisfy the debt, and it will follow the student all the way to the grave.
What have you learned from your unique background working with religious institutions about how occupational ministry and finances collide?
There are of course numerous and beautiful exceptions I’ve seen, but here are a few trends I’ve noticed.
Often, ministry leaders are incredibly gifted at relationships, but they do not have a very keen business sense. This can have the effect of a poorly run organization that is out of tune with realities its donor base grapples with on a daily basis, even if the leader has good intentions and the doctrinal statement is sound. Of course, there are problems that come with unreflectingly adopting “secular” business principles, but at a minimum, a basic understanding of budgeting, business, and economics (and law) would help ministry leaders.
By embracing a negative mindset toward finances, pastors contribute to the sacred/secular divide, and stymie their flocks’ ability to think Christianly regarding money and work.
Many younger evangelicals who do not feel called into pastoral ministry come to the conclusion that in order to faithfully serve God, they must start or work for a non-profit, because, in their mind, they cannot work for a for-profit company because “profit equals greed,” which is, of course, a sin. But profit and greed are distinct concepts that are not necessarily correlated. This mindset has deprived us of thoughtful Christians in the marketplace and given us too many non-profits, which has had the concomitant results of draining kingdom resources and increasing ministry redundancy. (Not to mention the sympathies toward Marxism this general disdain toward capitalism has engendered—an economic philosophy whose utter failure to actually work in reality has only been surpassed by the torrents of blood that have flowed everywhere it’s been implemented.)
Many believe that by getting too far into the details of finances, they aren’t trusting God or would be idolizing money. A quick survey of Proverbs should put that fear to rest. (See, e.g., Prov. 27:23.)
There is also the risk of the pendulum swinging the other direction toward the “health and wealth” prosperity gospel, which also prevents thoughtful, biblical engagement with finances.
Jesus rightfully warned of the dangers of money. But by failing to help move their flocks beyond “money is bad” (except when the offering plate comes around), the church is left ill-equipped to expose the idols of the age and model a biblical counterexample.
Thank you for your wisdom, vulnerability, and leadership in this area. We are deeply grateful.
If you’d like to learn more about David in is own words you can visit a longer bio here: www.sdglawllc.com and if your organization has any legal needs feel free to reach out to him here or 703-771-4671.
My wife and I fell into a rabbit hole mini-binge watch of TLC’s “My 600lb Life”. Besides being very motivating, the show is a fantastic look into human behavior. It isn’t a coincidence that many financial teachers have used weight loss as a picture of getting our personal finances under control.
As I watched these episodes, I noted a couple observations:
- Real change takes two years
The show follows a subject’s story over an extended period of time, generally about 2 years. It’s obviously not easy to lose 300-400lbs, but it’s easy to forget that a huge change can take a long time. For people in large amounts of debt, I’ve also noticed it takes about 2 years to get out of a massive financial hole. This could be discouraging – but I choose to think of it as encouraging. No matter how big your problem, there is a decent chance that two years from now you could have a completely different life.
- Surgery doesn’t fix it
The people on the show are there because they’re seeking to get a lap band surgery to help them lose weight. It’s interesting that the doctor doesn’t let them get the surgery unless they lose a significant amount of weight first. He understands that surgery isn’t the solution – the patient has to be willing to change first. The first step is always a change of the heart and mind. It’s helpful to remember that there isn’t any financial fix (more money, better job, lower interest rate, rich uncle) that will ‘fix’ your life. Instead…..
- It always starts with a choice
Any big life change will always be initiated by being ‘sick and tired of being sick and tired’. It’s being ‘mad as hell and not going to take it anymore’.
- Caused by trauma
It’s heartbreaking to hear the back story of the people on this show. Nearly all of them can trace their physical problems back to a major trauma – often being abused (physically, sexually) in some fashion. It seems obvious to this amateur physiologist that there is a direct connection between an event that caused the victim to hate their body and the ensuing weight gain. Finances aren’t always like this, but often we can trace our attitudes and behaviors back to the way we were raised to understand money. Often students I counsel will start our conversation with some version of “My parents weren’t very good with money”.
- A million small choices
Nobody gains 400lbs in a day, week, month, or year. Similarly, most of us got into debt over a period of time through a lot of small choices.
- This will change your life
Losing 400lbs over 2 years will change your life. The show’s participants are always so grateful to have made the journey. Nobody loses that much weight and says “You know, my life is pretty much the same just with smaller jeans.” When I’ve felt the crushing burden of too much debt, it expands into my mental and spiritual spaces. I’ve found myself thinking about money throughout the day, or trying not to think about it and feeling guilty about ignoring my problems. Getting out of debt will change your life. Once you’re out of debt, your life won’t be “pretty much the same just without any payments”. No, I think you’ll find it affects lots of decisions and emotions that you never considered.
- Takes a team
The story of the show isn’t just the main character, it’s always the supporting cast. There is usually a massive enabler or two that helped the protagonist get to their current state. Once they are ready to change, a team of doctors, nurses, personal trainers, nutritionist, friends, and family all come along side the person and help them toward their goal. Finances are similar – if you can build a team of encouragers around you it is wildly helpful. Here’s some more info on working toward a goal with a team.
- A persistent spark of Hope
When things are dark, we need to remember that it will be worth it. In “The Pilgrims Progress”, Christian is helped in his darkest times by his companion Hopeful. When we’re ready to quit, what we really need is Hope. Hope that all the sacrifice will ultimately be worth it. Watching the TV show I’m reminded what Paul taught:
“We also glory in our sufferings, because we know that suffering produces perseverance; perseverance, character; and character, hope.”
I got to know Josh last year when we were stuck at the Pittsburgh airport together. He was kind enough to buy me lunch and I can confirm he pays with cash! He is a graduate of Denver Seminary currently working with Dave Ramsey’s organization teaching financial principles. He is uniquely understanding to the real life financial stress of being a graduate student.
What years were you at Denver Seminary, what was your focus, and what are you doing now?
My family and I were at Denver Seminary beginning in August of 2007 and graduated in May of 2012. Yes, we were able to cram a two-year degree into five years. As any economist can tell you- this was a booming time in our national economy 🙂 A little backstory, my wife (Christina) and I started with one child and, before moving off-campus in 2013 for a job back in the South, when I graduated we had four children under the age of six. So we went through seminary at a slower pace – at the speed of cash.
I initially was accepted into the counseling program, but at the last minute, I changed to a MA in Leadership and studied leadership with a self-designed emphasis on community development.
Now, I am part of a team of stewardship/church advisors at Ramsey Solutions or better known as Dave Ramsey’s office in Brentwood, TN. Together we serve pastors, church leaders, community developers, and seminarians as they are building and/or remodeling their financial discipleship ministries in their churches/communities.
Draw a connection between personal finances and your ministry training. Why are you doing what you do now?
Personal finances played a large part in “How?” we went through seminary. We went through seminary as we could afford (at the speed of cash) and did not take out any student loans, or any loans for that matter pre/post seminary for living expenses before, during or after seminary… nor did we have to take out any loans for relocation expenses post seminary. Which meant I took classes part-time (a lot of night classes) and worked full-time down in Colorado Springs. We lived on campus in Littleton so that we could literally have a built-in community for my family through our seminary years. During my seminary years I truly embraced a concept that Dr. Larry Lindquist noted at my new student orientation, “Learn from, embrace and take note of the time and experiences spent outside of the class and library as much as the time inside the class and library.” In other words, pay attention and be aware of the experiences and interactions that God orchestrates during your seminary years both inside and outside the structured learning environment.
A big part of “Why?” I am doing what I am doing now is because of our experience of going through seminary debt free without loans and how God surprised and transformed my family and I with His lavish provision which came in many forms- literal hard work, redemptive financial gifts from churches back home, anonymous envelopes of cash on our doorstep, care packages from friends and families, support from our neighbors and peers on and off campus, and lavish support from ministries in the Denver metro area (e.g. Manna ministries, bread drop and food closet at Denver Seminary, odd jobs for my mentors, and support/encouragement from Colorado Community Church, etc.). Through this transformational process known as the “seminary years” we were able to graduate seminary debt free and go when God said, “Go” via a job opening at Ramsey Solutions.
Now at Ramsey Solutions, I have the opportunity and privilege to minster and walk with men and women who are leaders in their community and looking for ways to equip families, marrieds and singles who are struggling or in need of a tune up financially. It still surprises me each day how finances are many times a gateway to how someone is really doing. Billy Graham was spot on when he said, “Give me five minutes with a person’s checkbook (or online bank account these days), and I will tell you where their heart is.”
In your personal story, what did you have to do to graduate without a big debt burden?
Decide that going into debt and taking out loans was not an option from the beginning. Again, it is important to note that my personal story turned into a family and community story. When my family and I graduated from seminary it was a team success. Yes, I had to do literally whatever it took to graduate debt free, which many times required me working and traveling a whopping 70-80+ hours for a five-year period… but God was so lavish in His provision of not only work but wages, health, a steady stream of prayers and encouragement from friends and families across the country.
What do you think are the biggest FINANCIAL challenges facing future ministers?
Pride, pride and… pride. Be open and ask for help. We all need help, so put your pride aside, humble yourself and let others know how they can help you- the sooner the better. The world does not need perfect leaders, but humble leaders who can ask, be filled and receive help from God and through His means. My mentor Pastor Brad Strait said it best, when personally I hit a VERY low point midway through seminary, “Joshua, allow others to minister to you. One day, I know this may not be encouraging right now…,” he laughed and continued, “… you will be on the other side of the equation and serving others. So do not forget the struggles, thoughts and challenges you are experiencing right now and use them to better serve others.”
If you could give one piece of advice to a student just starting seminary now, what would that be?
“Slow down and go outside.” A smile comes to my face as I reflect on my seminary years and the wisdom that was poured into me from one man in particular- the late Dr. Vernon Grounds. I can think of at least three different encounters in the Denver Seminary library in which he would stop by my desk and say, “Son, what’s the rush? Go outside… its beautiful out there. Don’t spend all your time cramped up in this library!”
Or said another way, don’t believe the myth that the pace of the seminary years will slow down once you graduate. I would argue that the pace only increases after you leave, and you need to be intentional NOW about building in times “outside” with friends, families and enemies for that matter… before, during and after your seminary years.
How is it even possible to go to graduate school without going into debt?
First of all, going to graduate school is a want not a need and is a choice. I literally made a deal with God before going to seminary. I told him, “God, if this is your idea, you are going to have to provide and show me how to make this work financially each semester.” Remember, with God all things are possible, and this may require one to rethink his or her current way of going through seminary and to evaluate their previous, present and future standard of living. We made a ton of small changes and pivots to live more intentionally and frugally. For example, prior to attending seminary and as a family of three, my wife, daughter and I lived in a 240 sq. ft. apartment. We also worked two jobs and saved up an entire full year before moving out West to begin seminary. Once in school, we took full advantage of bread drops for seminarians, became a one car family, very very rarely ate out, had family style meals with neighbors, refrained from getting a TV and our entertainment was enjoying the great outdoors. Chances are, if your story is like ours it will also require more than just the work of one’s two hands and will involve a community of support, gifts, pep talks from mentors, days of repentance and journaling, telling others “Sorry, I was wrong!”, forgiveness, letters of encouragement and prayers to get you through as well.
Remember, I wish someone would have told us this: It costs money to move to that new job after you graduate. So start saving for moving expenses if your next job requires you to move across the country.
What word of advice do you have for someone that isn’t good at budgets? How do I start doing a regular budget?
Join the club! Like the Apostle Paul, when it comes to doing a budget, “I am the chief of sinners!” Kind of joking, kind of not, but seriously- it takes practice. My wife Christina and I, when we were first married took 3 months to just get started doing a budget (this is what happens when your marriage consists of two oldest children who are recovering perfectionists). We attended financial seminars, read budgeting books, used online forms and sought out advice from those that we wanted to mimic financially as we grew up together; however, it was not until we went through a Financial Peace University class (that was hosted by our Senior Pastor at our home church in South Carolina) that we actually did and lived on a budget on a consistent regular monthly basis. Are we perfect now, “No!” Some months we do not start until the month is almost halfway over, but we now build grace into our budgeting lives, remind ourselves to push pause, start where you are and face the reality of where you are in the month and what remains.
Make doing a budget simple. I have heard it said that budgeting is like a marathon. As a runner, this is ridiculous – a marathon only lasts 26.2 miles and is one day. Budgeting is more like an Ultra Race that lasts your entire life! All kidding aside, find a basic budgeting spreadsheet or plan that works for you and your family and KEEP IT SIMPLE. With time you can add more depth, but first you will need to pace yourself for the many miles of budgeting yet to go. If you really want to make a budget stick and see lasting results, ask for help from a budgeting coach. This needs to be someone who has a track record of helping others, the heart of a teacher AND can help keep you accountable, no matter how much you whine or try to make up an air tight, theological excuse of, “Why?” your situation is different especially as a seminary student (pointing a finger at myself here). As Dave Ramsey is fond of saying about a young, novice baker who is frustrated that his vanilla cake keeps turning out chocolate, “If you are not happy with the results you are getting, change the recipe.”
You can touch base with Josh at email@example.com. If your church would like to host a Financial Peace University class, he would also be a good contact for you. Thanks for reading! Sorry for any abuses of the king’s English – this is a transcript of a recorded conversation.
Ten years ago exactly this month, Noelle and I opened the credit card statements from Christmas and realized we owed over $7,000 on those two charge cards. We also owned a condo that wasn’t rented, had a car loan on a sweet Mustang GT convertible, and one more student loan for old times sake.
That week I was playing basketball on a Monday night at Smoky Hill Vineyard church and saw a sign there for a class: Financial Peace University. We had missed week one, but the next night – week two of the class on a Tuesday in January, we were there.
It didn’t happen overnight, but we sold the condo, sold the mustang, lived on “beans and rice”, and paid off all of that within the year.
It isn’t a coincidence that these classes start this time of year. January is a time of new year resolutions and new beginnings. If you’re “sick and tired of being sick and tired”, now is a great time to push the reset button.
You can find a class at a local church. CLICK HERE FOR LIST OF LOCAL CLASSES.
Feel free to reach out to me for more on our experiences and what we’ve done in the 10 years since.
This article surfaced in The New York Times a couple weeks ago:
They Thought They Qualified for Student Loan Forgiveness. Years Later, the Government Changes Its Mind.
I’ve written several times including this long post in September of 2015 that I thought the Public Service Loan Forgiveness program was risky and I did not think it was wise to plan on the PSLF program to be your primary loan repayment strategy.
The risk that the government could change the rules at any time was one of the original reasons I wrote that I didn’t like the program. That is exactly what happened to the subjects of that NY Times article and we’ll see how the pending litigation plays out.
There are other alternatives. If you’d like some help working through those then hit me up.