Money Matters - 05/13/14
Money matters, it really does. Don't get me wrong. I get that. However, the truth is most of our money problems are self induced.
Take the NFL for example. I have a story in my Saving You Money segment tonight related to the recent NFL Draft and the millions draftees suddenly have placed in their laps. Sports Illustrated did an analysis and found that 78% of former NFL players are bankrupt or close to it. It's not how much you make. It's what you do with it.
My sweet niece is getting ready to graduate from high school and asked me for some financial pointers as she meets this milestone. Her questions were part of a Bible class she's taking. As I answered them in writing, it forced me to revisit so many moments in my adult life that could have been financially devastating. They weren't because of the fiscal philosophy we live by at our house.
What follows is an excerpt from our correspondence. Pass it on if you think it can help someone you know.
Mentor Assignment #2
1. Niece: What advice would you give me in the area of finances?
Stacy: Well, this is an important topic for sure. The Bible is pretty specific on financial matters. In short, the Bible says you should not go into debt, you should save & that we have to be good stewards of what God has blessed us with. It's important to remember as you start your adult life not to rely on others to meet your needs. You have to work for what you earn and nothing in this world is free. If you don't spend more than you have, then you won't ever go into debt. This is completely in your control. People always try to complicate money and it's really not complicated at all. You simply don't spend what you don't have.... you don't live beyond your means (what God has blessed you with.) If you think you want something you can't afford, work to save for it. You'll have a greater self satisfaction in your soul if you earn your own way and prove to yourself you can do it. Sometimes, this means not being able to go do things or buy things others are buying. I remember when I started my career, I was only making $14 thousand dollars A YEAR!! I was broke, yet I never felt broke because I made a budget based on $14K and I never went over it. I couldn't always go out to eat, go shopping for clothes, etc.... but I was pursuing my dream and I didn't care what I made. Do what you love and the money will come. Here are some scriptures I like:
"For which of you, intending to build a tower, does not sit down first and count the cost, whether he has enough to finish it"lest, after he has laid the foundation, and is not able to finish, all who see it begin to mock him, saying, 'This man began to build and was not able to finish'?"
Debt scripture: Matthew 6:24
"No one can serve two masters. Either he will hate the one and love the other, or he will be devoted to the one and despise the other. You cannot serve both God and Money."
Proverbs 22:7 "The rich rules over the poor, and the borrower is the slave of the lender."
2. Niece: What has been the hardest time of your life financially and how did you make it through it?
Stacy: Well, as a news gal... you know I'm all about the statistics. Arguing about money is the top predictor of divorce. 45% of divorces are caused by money issues. 65% of couples argue about money. Uncle Chris and I don't argue about money. Early on, when he proposed to me 20 something years ago... he was in debt. He had gotten into debt in college because credit card companies send you lots of credit card offers in college. Not knowing any better, Uncle Chris signed up for them. So, I told Uncle Chris I would not marry him until he paid off all of his debt. I did not want to take on his debt because I had no debt and planned to live a debt free life. He quickly got busy paying off his debt and through this process developed a deep and lasting passion for financial responsibility. It's why he changed careers many years ago from being a sportscaster to helping professional athletes safeguard their fortunes. He had seen so many heartaches and tragedies that could have easily been avoided. He felt there were so many people who were sabotaging their families and their futures by not being good stewards of what God had blessed them with.
However, the hardest financial time was in fact, when Uncle Chris changed careers because at that same time I had also left CBS News and was freelancing (making a fraction of what I had been making.) I needed to be home with the kiddos more and needed more work flexibility. By changing careers, Uncle Chris also was making less initially as he built a new business set on leaving a legacy. But, we had prayed through all of those decisions making sure we were in God's will with these career decisions and God has in turn blessed those decisions. We simply sat down, made out a new budget based on our smaller income and stuck to it. We stopped going out to eat, I bought the kids' clothes at consignment stores, I couponed, etc.... I might also add that also during this time, we had a health crisis on our hands and a flooded basement. We made it just fine and never had any trouble paying our bills because we lived within our means. Our 'means' and everyone's 'means' changes during seasons of life.. it ebbs and flows depending on the economy, career choices and changes, family considerations, illness, emergencies, natural disaster, etc. So whatever you're making at any given time.... live within your means and be happy right there..
3. Niece: How has your perspective of money changed from when you were a teenager to where you are now?
Stacy: My parents were sticklers about being responsible with finances, so they taught me everything I know. Now, Uncle Chris is better at it than me, so he's teaching me new and better ways to make money go further. In short though, these ideals were placed in me at an early age by my parents, so not much has changed in terms of my perspective of money. My parents had me work early on doing chores and earning money and had me get a job when I was old enough so that I could learn the sheer satisfaction of making my own way in this world. They wanted me to learn how to be responsible for myself and to learn the value of a dollar. They also wanted me to learn that I could not depend on others to pay my way. I had to earn it, every single cent of it and this takes sacrifice.
My parents taught me to live on about 50% of what I make, save about 30% and give the rest away. That's tithing, charity, etc... Chris and I have lived by this and we've always kept a minimum of 3 months' emergency fund in place. It's important to live this way because as humans we really don't need all 'the stuff' we think we need.
I was scared of credit cards in early adulthood. My parents had drilled into my head that they were bad and I should not get one. So, I did not get one until I was about 28. Uncle Chris and I decided together we would get one and we would do this with one prerequisite... that we were making a pact to pay off the entire balance (not just the minimum payment) every single month and never carry a debt over from month to month. If there was ever a time when we thought we wouldn't be able to pay it off at the end of the month... then we didn't charge it to the card. It just takes discipline. Today, we like having a credit card because we get frequent flyer miles for every dollar we charge (and pay off each month) then we take free flights. This also gives us a detailed accounting of our expenditures for tax purposes.
I love you!!!!!