REMINDER: INCOME VS EXPENSES

money tree

When I counsel people (including myself) on how to make their budgets work, I often find that they are much better at EITHER controlling spending OR earning money.

As a reminder, there are two sides to each budget/balance sheet:

INCOME

and

OUTGO (expenses)

The old cliché is that we tend to be ‘savers’ or ‘spenders’. While that is often true, it is very difficult to win with money if you a thrifty saver but don’t earn enough money. Likewise, no matter what my income is I can always find a way to outspend it.

To make a budget/balance sheet work, we need to earn enough AND spend it wisely. The majority of people that volunteer to come talk to me about their money (grad students), tend to be thrifty savers but are having a hard time making ends meet without going into debt – something they don’t want to do.

For them, they don’t have a saving/investing type problem. Instead, we have to put our heads together on how they can earn more money. That can be challenging with the time constraints of school and family. It also isn’t a quick fix – there isn’t one change to be made.

The good news is that there are lots of options. Earning more money is a skill that can be built. The reality is that someone that has earned more in the past is significantly more likely to earn more in the future. Why?

It may be that they are more apt to recognize financial opportunity, how to leverage their skills in the marketplace, how to ‘sell’ themselves as a bargain to potential employers, or how to provide and communicate their value.

More on that:

https://graduatefree.com/2015/01/20/part-time-jobs/

https://graduatefree.com/2016/11/17/how-to-get-paid/

https://graduatefree.com/2016/12/07/how-to-reset-your-life/

Step one to any change is making a decision. If we decide we need to make more money to make our budget work, we will begin to look for and see opportunities. Prayer is a powerful tool in this. God can open the eyes of our mind.

Conversation with Josh Collier

josh-cI 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 joshuathecollier@gmail.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.

BUDGETING BASICS

Jar of money

When I meet with students and young couples, the number one thing we work on is putting together a super quick, easy, zero based budget.

Despite my love of finance, I’m more of a ‘Free Spirit’ than a ‘Nerd‘, so budgeting has always been a challenge for me. This year, practicing the discipline of doing a zero based budget every single time our family has  income is going to be my most important financial priority.

I’ve long believed Dave Ramsey is the most PRACTICAL financial teacher in the world. He doesn’t just teach you financial principles, he actually lays out a plan that everyone can follow to get there. You might disagree with his plan (Baby Steps), but the reality is that most financial teachers won’t actually put their principles in simple black and white instructions, and most of us don’t actually have a written financial plan we are truly following.

If you are going make a new years resolution to do a better job budgeting this year, here is a PDF outlining Ramsey’s basics for budgeting and answering the most common questions.

DOWNLOAD:  DAVE RAMSEY guide-to-budgeting

Photo: taxcredits.net