WisdomOnWealth.org

You may well know exactly how much money you earned last month, but do you know how much you spent? Or do you know how much money you have left to spend this month? If you don’t, you’re not alone. Many people have little idea. The facts can’t lie, and they tell us that most people in the West spend more than they earn. This statement is reflected in the fact that the average household debt (excluding mortgages) in the UK is £8,765A (approx $17,000).

So why is it so difficult to track your spending? Today we live in a near ‘cashless’ society. Using debit cards, credit cards, automatic deposits and wire transfers, we rarely even see our money. It’s easier than ever to spend, spend, spend. Never before in history has there been a more pertinent time to work with a household budget!

FAITHFUL FINANCAL STEWARSHIP

Let’s never lose sight of the eternal perspective. Every Christian is going to one day stand before God and give an account of how they managed their life (and a large portion of this will be money related).

For we must all appear before the judgment seat of Christ, that each one may receive what is due to him for the things done while in the body, whether good or bad.
2 Corinthians 5:9-10

As a steward of God’s money it is important that you budget! After all, it is always better to know where your money is supposed to go rather than asking where it went. You’ve heard the saying about acting your age - not your shoe size, but how about this... ‘When it comes to money, always be sure to act your wage’?!

Whether we have a little or a lot we need to be faithful in the way we earn, save and spend. In essence, it is wise to allocate all of your money to specific purposes; this is the basis of budgeting! It will ensure that you make optimal use of the resources God has given you.

Be sure you know the condition of your flocks, give careful attention to your herds; for riches do not endure for ever, and a crown is not secure for all generations.
Proverbs 27:23-24

IT'S JUST A MYTH!

In order to get our finances straight in a God-honouring fashion, it would be wise to expose some of the myths that have been a barrier to others in the past. Here are our top three:

1. You only need to budget when you’re in debt: Budgeting is a stewardship tool for EVERYONE. True, budgeting can help you recover from a crisis. But why get into a crisis in the first place if you can avoid it? Budgeting helps you stay out of debt. It is also true that good budgeting can lead you to greater levels of financial control and wealth.
2. Budgeting is painful: Any change is difficult at first, and there is certainly no exemption when it comes to finance. However, the positives of taking control of your finances far outweigh the initial pain that might be experienced in identifying problems and planning to work your way out of them.
3. Budgeting is complex and you need to be good with figures: The truth is that all you need to be able to do is add up! And with a calculator, there really is no excuse these days. Basic budgeting is just knowing your income and your outgoings, and planning how to, as a minimum, balance the two totals. All you need for that is a pen and paper, or a simple Microsoft Excel spreadsheet. Alternatively, there are plenty of software tools that can help you go deeper. In addition, Internet banking can make your budgeting much easier and more accessible.

BENEFITS OF BUDGETING

Having a household budget will help you in many ways. Here are just a few:

• Keep control: A budget lets you control your money instead of your money controlling you.
• Know your balance: A budget will tell you if you’re living within your means. Before there were credit cards, you could tell if you were living within your means because you had money left over after paying all your bills. Now it’s more difficult.
• Debt-free: A budget can keep you out of debt or help you get out of debt
• Make the most of opportunities: Knowing the condition of, and being in control of your finances, helps you take advantage of opportunities to give, save, spend, or invest.
• Save: When you budget you are able to set aside money for savings and investments – even if it’s just a very small amount.
• Communicate: Finance-related issues are now the number one cause of marriage break-ups. A budget provides a common framework to work and talk around. Time spent arguing about priorities becomes a thing of the past.
• Relax: A budget helps you sleep better at night because you don’t lie awake worrying about how you’re going to make ends meet. Remember, God doesn’t want us to be anxious about anything.

In simple terms, the basic aim of budgeting is to move you out of debt (or keep you out of debt) into sustainable credit so that you are always in a position to serve God financially. How this is done can be summed up in the words of Christian financial expert Ron Blue: “The only sure path to financial stability and success is to spend less than you earn for a long, long time”.