Need Money Management?
Let’s talk about the word “management.” What does the word “management” mean? The word management really means “to take control of,” okay? “To take control of.” If we don’t take control of our money, if we don’t have a plan, we are going to fail. If we don’t plan with our money, our lives, the different things we need, then we’re going to fail, and I have failed. I had to file bankruptcy. I had to do an offer and compromise with the IRS, and I’m going to tell you, I know what not to do, but I’m a planner now because I want my money to be doing what I choose for it to do, not what just happens.
Money will just go disappear. It’ll go places, if it’s not managed, and so we need to understand that the best possible first step in planning and taking control of your money is to build a budget. That is absolutely critical. You’ve got to have a budget, got to know where the money is going. A budget, really, is like a snapshot. I went to the chiropractor. My wife got me to go to the chiropractor. My dad’s a doctor and he didn’t like chiropractors very much. I didn’t know anything about chiropractors to be real honest with you, but my dad said they were quacks, and I thought, well, I won’t go to one then, but my wife got me to go and so I went and they took x-rays of my back and my neck, and my posture, and what I found out was, x-rays don’t lie. They really don’t lie.
I was having pain in my lower back and I was having pain in my neck. Can you imagine that? It might’ve been the circumstances of being a pastor, but maybe not. Anyway, so, what happened is, I ended up looking at the x-rays, and I went, “Oh my gosh, this is incredible. No wonder I have pain. I’m starting the baby boomer generation. Things aren’t working well.” Oh my gosh, I decided right there on the spot, I’m going to do something about this, because my father was hunched over. The older he got, the more hunched he got. He looked the hunchback of Notre Dame as he was really older. I’m not going to look like the hunchback of Notre Dame. I went to USC so I don’t like Notre Dame, but the reality to it is, is that I’m not going to be in that context. No way am I want to stand up straight.
I got a picture of my posture and I almost fainted. I said, “I look like that?” I mean, I look like a hunched back, and it was just not very appealing, and I didn’t like it at all. Well, guess what? A budget is like an x-ray.You take a snapshot of your financial condition, and what you find out many times is not real fun, I’m sorry to say. It can be a problem, and so what you can do, then, is … Some people want to put their head in the sand like the ostrich. That is a problem because something else is sticking up out of the sand, and it really doesn’t solve the problem, and if a wolf comes along and your head’s in the sand, that’s not going to work real well, so what we want is we want the truth. We want to know what’s really going on.
Well, a budget shows us that. Now, let me tell you about why a budget is so vitally important. I use budgets a lot in the financial planning arena. I always had somebody have a financial statement, which is a little bit more … Not a working, ongoing … It’s really a total snapshot of where a person is today, but we need … I’m going to tell you, you need, I need, everybody needs, a written, monthly budget which allows you to see where your money’s going. Where is your money going? You write down every expense, every time you write a check, every time you use a debit card or credit card. Every time you spend money, you write it down. You keep a track of it. You keep a log of it, and then you begin to find out, “Oh my gosh, this is where my money’s going.”
It is not maybe your most fun activity to put it together, but you will have life change if you see how you’re spending your money, and you can make choices then. Right now you have no choices because you don’t know what you’re doing, and it’s okay. I’m not condemning. I’m not saying it’s bad. All I’m saying is, wouldn’t it be better to know where your money’s going? How are you spending your money? Then, are you making enough income to take care of all your expenses? You have fixed expenses and you have expenses that are recurring expenses. Fixed expenses, your house payment, your car payment, your insurance payment. Those are fixed expenses. Your food, your gas, your personal care. Those are expenses that are not fixed, and they’re going to change, but the fixed expenses are what you put down. You pipe 2 columns. One’s income. That can usually be a pretty short one. Whatever you take home, if they withhold your taxes, or if you’re in business for yourself, whatever your net check is that you get from the company.
Now, please take out taxes. If they don’t take out taxes, you’ve got to take out taxes, and a good rule of thumb is to take out 30 percent if you’re an independent contractor. I’ve learned that the hard way, and I will tell you, it is critical if you don’t want the IRS breathing down your neck, so whatever you have leftover is your income. Now then, you take all your expenses in the other column and you total them up. Whatever your income minus your expenses are is what you have left over. Most people don’t have anything left over or very little left over, and that’s a shame.
I read a report recently that 63 percent of the American people are one paycheck away from failure, bankruptcy. That’s horrible. Oh my gosh, that’s a hard way to live. We need savings. We need to cut back on some of the expenses and start to save more. When we save more, we’re going to have more security, if you will. We’re going to be able to breathe … Would you like to breathe easier? I tell you, I have savings. I don’t use up my savings, because savings is my way of being able to breathe. Breathe. When things come up, I can breathe. I’m not caught off guard.
6 months of savings is literally critical, so you’re going to put this budget together. Now, it doesn’t matter what it looks like. It’s not too important to have it look just so, but you want to put, as I said, your variable expenses … Actually you should have 2 columns under expenses. One is fixed and the other is variable. Now you’re going to see, but you’ve got to keep your … When you pay for your gas, keep your receipt. You’ve got to keep receipts. You’ve got to find out where you are, especially in your variable. Fixed is pretty easy, but in your variable, it’s vitally important.
So, you are going to have choices. Once you have choices, you’re going to have and be in management of your money. Now you’ll end up in a place where you’re managing your money. Your money is not just dissipating and going away. Now, here’s the key, is you are learning how to manage and control your money. We need to look at your attitude towards money. I don’t have much time left, but just check your attitude. What kind of an attitude do you have? Well, I’m going to tell you, real quick. The attitude you’re going to have is the attitude your parents had.
If your parents were depression parents or have had real problems with money, you’re going to have problems with money. You’re going to spend too little but not save, or you’re going to save too much. It’s going to be a mess. If your dad or mom was tight fisted, you’re going to be tight fisted, and if your mom and dad were spenders, you’re going to be a spender, and I’ve seen this. I’ve seen this and seen it and seen it and seen it, and we want to look at your attitude towards money. One thing I want to say to you is give. Please give, because if you don’t give, you will not be given to. Good measure, brushed down, shaken together and running over, because it’s vitally important.
You’ve got to have an attitude towards money that it is, God owns everything. He owns us. We were bought with a price and our money is not our own. We’re just stewards of the money. If you feel like you’re an owner, well, then, you’d better talk that over with God, because he can take it away. You can end up with losing your job. It can be a real problem, but if you’re a steward, then God gets to use you to tell you where to put the money, and the Bible says in Malachi 3:10 that if you’ll give to, and put the money into the storehouse, which I believe is the local church, then the church will have money to do what it needs to do, and it needs to pay its expenses. Well, if you go to that church, you need to support that church, and it will have a provision for everything, all the expenses that it needs.
It says, prove me now here with if I don’t open up the windows of heaven, prove me now. It says now. Now, now, now. Not in heaven. Now. You can’t out-give God. It’s impossible to out-give God, so I’d like to talk more about giving. If you’re a cheerful giver, that is going to be vitally important, if you’re a cheerful giver, because God wants you to be grateful for the money that you have. He gave it to you. He gave you your job. He gave you your talent. He gave you your gift, so please be grateful. Once you have created your budget and part of that budget is giving, always give at least 10 percent, you’re going to be in better shape and you will really end up being in a place where you’re going to be excited.
Now, you need to set financial goals. I don’t have the time. I’m running out of time right now. I try to keep these to 10 to 12 minutes, and one of the things I’ve got to tell you, you’ve got to have financial goals. A financial goal might be, “I want to spend less, I want to save more,” but I can’t tell you how to set those up right now, but if you give me your email and you tell me that you want to know about setting financial goals, you want to know more about setting up a budget, you want to know more about the biblical reasons to give, you want to be a money manager, you want to manage your money, then give me your email and I’ll give you, free of charge, the information that I put together that will really help you.
If you’re not on our website, JoyStones.org, then go to our website. You’re not only going to find out how to manage your money. You’re going to find out how to get out of debt. You’re going to find out how to have more money, but you’re also going to find 15 videos on subjects that are vitally important to your life, so, like I said, give us your email and we will help you manage your money so that you don’t have to be in a position where you’re one paycheck away from disaster financially.