Forward into Less

It is human nature to always want more.    When billionaire John D.Rockefeller was asked how much was enough,  his response was, “just a little bit more.”

Popular culture pushes this urge for more even further.  Watch any commercial and the basic message is that you are lacking and this product will make you feel better.  We are encouraged to be unsatisfied with what we have even if we have enough. 

A person at the US federal minimum wage of $7.25 an hour, working 40 hours a week grosses $15,080.  While this amount would make it very difficult for a person to live in the US, it would still be enough to put them in the top 12% richest people in the world (globalrichlist.org).

If you have the ability to read this blog, then you have enough.

There is a similar phenomenon in the spiritual realm.  For a person who has made Jesus his Lord, it can be easy to get wrapped up in the “perceived benefits” of service to the Lord.  When people notice the work that we do, it feels good, but it is not fun to toil away in obscurity or to see others get credit for our hard work.  This can lead to anger, jealousy and bitterness.  I think that is one of the reasons why we need to encourage each other.  But it stands to reason that there will be times when our work will not be as appreciated as we would like.

It is human nature to also want to move upwards in positions of leadership and with that the feelings of respect and admiration.  It stands to reason that we will reach our positions and may feel unsatisfied with filling a role that seems beneath us.  Having to accept a demotion can be very difficult to take because of the feelings of humiliation and perceived loss of respect and admiration.

John the Baptist was losing followers to Jesus, and when he was told this he responded correctly:

“A person can receive only what is given them from heaven. You yourselves can testify that I said, ‘I am not the Messiah but am sent ahead of him.’  The bride belongs to the bridegroom. The friend who attends the bridegroom waits and listens for him, and is full of joy when he hears the bridegroom’s voice. That joy is mine, and it is now complete.  He must become greater; I must become less. (John 3:27-30)

John knew his role.

“The Father loves the Son and has placed everything in his hands. Whoever believes in the Son has eternal life, but whoever rejects the Son will not see life, for God’s wrath remains on them.” (John 3:35-36)

“Beware of practicing your righteousness before men to be noticed by them; otherwise you have no reward with your Father who is in heaven.” (Matt. 6:1)

This year, He must become greater, and I must become less. 

Tithing and Debt

Leonardo da Vinci Christ Carrying the Cross via Wikimedia Commons

A good way to center any discussion is to think about the Cross.  Jesus willingly went to the cross and suffered a horrible death (Matthew 26:53-54) (Hebrews 10:14).  He did this to offer a us a way to God that was unreachable through our own effort (Romans 3:23-24). Our salvation is a total act of grace and this should fill us with total joy and peace (Ephesians 2:8) (1 Peter 1:8).  Gratitude always trumps guilt as a motivator.

If you call yourself a Christ follower and are not tithing, then you have been stealing from God (Malachi 3:9). This sounds harsh, but there are real consequences for wrong living.  I'm not trying to guilt you into tithing, I just want you to see the reality of what is happening.  Sometimes as Christians we just need to do the right thing even though every fiber of our soul is saying we shouldn't.

The average family has almost $7000 in credit card debt.  Most families in debt tend to not tithe.  If you have no income then there is no need to tithe.  If you have income (even welfare) then you can tithe.  Most people have sufficient income to work their way out of debt, with a serious cost cutting plan.  

I believe that the tithe should be paid before any other debts are paid.   I know this sounds crazy, but if you can't live on 90% then you probably can't live on 100%. Tithing while in debt takes great faith, so you must trust God in this, because this will feel highly illogical. 

 If in debt, the concept of tithing sounds irresponsible, but you need to pay back God first what He has given you.  God wants you to test Him in this (Malachi 3:9-11).  This is the logic of the world: When I get out of debt, then I will tithe.  God’s logic is different, because He can work miracles and if you are in debt, you can use some miracles in your life.  Trust Him by obeying Him.  Remember, the logical side of things doesn’t always apply to issues of faith.  God is able to sustain you, bless you, and allow you move towards fiscal sanity.

Here is an odd mystery: obedience to God takes strength of character that comes from God (Matthew 6:9-13).  When you tithe in the face of debt, God rewards your obedience. One of the fruits of the Spirit that comes to Christians in obedience is self-control.  Self-control will allow you resist those urges to spend on things of short term value, thereby improving your financial state.  Another two amazing fruits of the Spirit are peace and joy.  When fulfilled by God, you will not experience the urge to spend as much because you will be satisfied with what you have.  In fact you will be grateful.  Gratefulness is one of the most powerful motivators in life. 

There is disagreement among some as to what qualifies as debt-free.  In my opinion, being debt-free doesn’t mean a lack of bills.  It also doesn’t mean an absence of loan payments.  For some things (cars, houses) you will need a loan, this is good debt, so don’t assume that all loans are evil.   Debt is a trap that God wants to release you from.  Trust him to set you free, but God does not promise that you will win the lottery. You need God's strength to radically downsize your spending and get out of debt.  Obey God and you will have access to this strength (Galatians 5:16).   


Look to the Cross, understand what you have, feel the warmth of God's love and then go do what He says.

Blowing Your Mind!!

Last week I talked about how a house actually costs less than an apartment, and now I am going to blow your mind.  Ready?  What happens in year 31 after your house is paid off? 

 

For the home owner, something amazing has happened in year 31.  They own their home, free and clear!  They now hold something of amazing value.  The other thing is that $16,000 each year is now freed up for whatever you want because you are no longer paying your mortgage.  For the renter, they face yet another year of rent increases AND they hold nothing of any real value.  It never stops!  In this case the rich do get richer and the poor do get poorer. 

But wait!  There’s more:  Once you have gotten yourself into a house you will eventually notice that it gets easier to make the payment. Over time, inflation renders money less valuable and this is a good thing for a homeowner because inflation increases your pay over time, but your mortgage is a fixed cost that does not change (assuming a fixed-rate loan).  All of these factors over time combine to make your home payment a smaller and smaller portion of your total costs.  This feels good.  

 Go check out zillow.com and type in your address.  If you live in an apartment, find a block with single family houses.  You can see how much each person on your block paid for their house.  Most houses in the suburbs are built in large groups utilizing a few floor plans to minimize costs. My house has five exact replicas on my block.  They all were priced identically initially, but over time various owners have come and gone.  In one of those identical houses is a fellow who has his house paid off, while I have another 20 years to go!  He paid far less and his payment was far less than mine is now.  That’s ok for me because I’m 40 and at 60 my house will be paid off!  This is about the time my kids will need me to be helping with college tuitions and weddings, but I will no longer be paying a mortgage.

As a young adult these future things will be easier if you make small sacrifices now.  Spend less than you earn and save up for a house.  Yes the housing market can be crazy, but I'm not trying to sell you on a get rich quick scheme.  If you buy a house THAT YOU CAN AFFORD and stay put, you will soon be paying less than the average renter. Eventually you will have no monthly payment for your housing and you will hold something of immense value.

Buying a House

 As a young adult it may seem that buying a house is a long, far-off dream; but I want you to see why buying a house is key to your economic success.  Once you see the importance of buying a house,  then you are more likely to watch your spending now and begin saving money. 

I want to show you something amazing.   Below is a comparison of a $900 apartment with a $270,000 house.  (Note for older adults: These numbers reflect Southern California rates, as the market rebounds these numbers will be much higher) I want you to see how rent prices per month go up each year, while the mortgage payment is fixed over the course of the loan.

We will now take a look at the same comparison by year.  Notice the total amount that you will have paid at the end of 30 years.  You will have paid more than the loan amount of $270,000 because you have to pay interest.  It is a lot of money.  The interest does add up, so that is why you need to be reasonably sure that you can afford the payments and want to stay in this house for a long time. 

If you have to sell before the value of the house appreciates significantly, you will have to literally pay money to sell the house because of the interest payments that you will pay to get out of the house.  I made an assumption that you will get a fixed-rate loan, because this type of loan will help keep you from a similar fate that is facing many stressed homeowners. This is something you need to learn out of the housing crash that we have witnessed.  

 A variable-rate home loan allows you to get into a house at a much lower cost, but it carries more risk that could get you in trouble.  The idea of a variable rate loan is that the bank charges you a low interest initially and raises it later.  Before the housing crash, the pitch they were making was that the house was rising in value so fast that it didn’t matter; you could just get further loans based upon the value of the house.  People were buying houses they could not afford and were banking on unrealistic rises in housing prices.   

When your home is worth more than you owe on the loan it is called equity.  Equity is nice, but in reality, it is worthless until you sell the house.  Since you need to live somewhere, the house you purchase next will eat up much of this equity.  If you downsize to something smaller, or move to a less expensive area, you can walk away with a lot of cash in your pocket.  In retirement, it typically does not matter where you live, because your kids are grown up and you do not need to be tied to a location for a job. 

            Do you see it?  You will pay almost twice as much over thirty years for an apartment.  I’ll bet you thought that apartments cost less, because that is where the poor people live.  You are right, poor people do live in apartments, but they cost more.  The reason why poor people do not buy houses and save a lot of money is that it takes a significant amount of money up front to get into a house and the mortgage payment will usually be initially higher than the average apartment rental.  You will need to save 20% of the house price (in this case $54,000) to get approved for the loan.  This is why poor people can’t get into a house.  The up front commitment is too big.  If you save aggressively you can get there.  

Money 101

 Here is an amazing plan for your finances.  At the beginning of each month or whenever you are paid set aside 10% for your home church (1 Cor 16:1-2).  This is called a tithe.  There is a lot of arguing going on about this issue, but my point is that the church is the vehicle through which the community is most likely to be blessed.   

Image by selbstfotografiert

The idea of a tithe is that you are giving back an amount immediately that has been given to you.  In fact none of your money is yours, it is all God’s, so 10% is a reasonable amount (Deut. 10:14).  Failure to bring this tithe leads to natural economic consequences (Malachi 3:8-10).  While the rest is yours to live on, you should also consider giving.  Giving and tithing are separate issues and should be handled differently.  An additional amount can be set aside for charitable giving, but it should be considered something you want to do.  

 Do not bow to pressure to give without consulting God, for if you resent having to give, then it is not pleasing to God (2 Cor 9:7).  If you fall into debt you may be tempted to stop paying your tithe, but this is unwise. Dave Ramsey in his book The Money Answer Book: quick answers to your everyday financial questions has noted that many people fall into worse financial situations once they stop tithing.  He further explains that 10% is a reasonable amount and if a person cannot live on 90% then they cannot live on 100%.  The effort to pay the tithe forces a person to budget, which can lead a person out of debt.

Earlier we talked about the ability to utilize gratitude as a way to follow God’s commandments.  By focusing on the tangible and intangible gifts of God, you reach a point where change happens.  God’s plan will take you out of your debt.  You need to set aside 10% of your salary for tithing and an additional 10-20% for debt repayment and the rest is the amount you must live on.  Living this way takes faith in God’s provision for your life (Matthew 6:31-33).

A good way to reason out the tithe in your mind is that God gives you a total amount containing the tithe on top of your amount, the total amount is really determined by Him.  What if a stranger knocked on your door and handed you $110 and walked away.  Cool.  But, what if that stranger came back an hour later and demanded $10 of the money back, you would be bitter, wouldn’t you?  But what if the stranger told you the deal up front?  What if he said, “I’m going to give you $100, but I’ll also give you $10 that you need to give back to me. Oh and by the way as long as you are faithful in giving back the $10 I’ll keep dropping by with $100 for you,  if you are faithful I may entrust more to you”   This is a pretty sweet deal, but this is similar to how God deals with us (Matthew 25:15-30).  Remember that God gives us all of it, even if you work for it. He has brought about everything to give you the opportunity to earn it.  (James 4:1-3)

When you are faithful you are showing yourself able to handle more responsibility, but don’t think that God can be fooled into giving you more.  He won’t necessarily give you more money just because you are faithful, but by being faithful you are now able to access the blessings that flow from being obedient.  Remember, more money brings more responsibility for those around us who have less (1 Tim 6:17-18).  The Spirit that resides in you prompts you to be obedient to God’s commands.  When you obey the Spirit there are benefits that flow from obedience (Galatians 5:22-23).  These “fruits” are amazing characteristics that I want in my life and you should want them too. 

God is very clear that these are the blessings that flow from obedience. Monetary wealth is not promised.  It is possible to be poor and very happy, and at the same time to be very rich and miserable (Prov 13:7).  Wealth is not the purpose of life, in some ways it brings more hassles.  Most people live a lie by living above their means resulting in debt.  You have to realize this and not try to “keep up” with them. 

Spiritual Economics

There are two obvious and one hidden dimension of the financial equation. Income and expenses are the obvious ones, so what is the hidden one?  As long as we spend less than we earn we will build savings.  The emphasis on limiting expenses makes sense because when we want to change the situation it is easier to stop spending than it is to bring in more money.  Income can be raised through increasing your education. 

 Photo by Petr Kratochvil

It is possible to make more money but the options tend to take a lot of time.  It is appropriate to work on these long term fixes, but it is best to reign in your spending now.  So what are some ideas to make more?  Some jobs automatically pay more if you have furthered your education.  You can switch careers, but this may take going back to school.  A switch does cause most people to experience a short term drop in income because you move to a lower tier on the pay scale.  As a teacher my pay is entirely a function of time in service and education level.  


If a car mechanic making $52,000 a year goes back to college, finishes a bachelors degree and gets a teachers credential it will take roughly 7 years at my district to get back to the point of where they were.  Remember, that in those 7 years the auto mechanic would probably be receiving pay raises.  This doesn’t mean the auto mechanic should give up on the dream of teaching, it just means that switching careers can be time consuming and expensive.  If that same auto mechanic were receiving no medical or retirement benefits, switching careers would make sense in order to get these benefits.  This pay drop keeps many people from going after something they want. 


 Long term thinking always trumps short term thinking, but is generally more painful in the short term.  You can generate more cash by working overtime, taking a second job, starting a sideline business, but these options eat into your time.  Sometimes it is best to make do with what you have then to chase after more money.  This chase for money can erode other areas of your life, especially you relationships with God and the people you love (Mark 8:36).  It is not wrong to be rich, but the thirst (or lust) for riches, is a foolish pursuit (Luke 12:13-21).

By lowering expenses you will generate savings, allowing you to invest and build wealth.  The goal of wealth, is to allow you to be independent and not dependent on others (1 Thess. 4:11-12) while able to help others (Eph 4:28).  Most people when they take a good hard look at their spending can identify areas where they can cut.  The truth of spending cuts as a way to economic freedom out of debt takes us to the third dimension of finances.  There is a spiritual dimension to your finances and it must be taken into account (Luke 12:34). 

The above verse talks about the correlation of spending to thinking.  We think about the things that involve our money.  If our money is going to bills and ever increasing late fees we will only think about that.  This is the mental trap of debt.  The hard reality is that you do not control any of the important variables of life (Matthew 6:25-34).  You could lose your job because the company you work for goes out of business, gets taken over, or moves to a new location.  Companies know that increasing productivity allows them to produce the same or more products with less human labor.  


According to Steven Bragg in his book The New CFO Financial Leadership Manual human labor represents the single largest expense for most companies; therefore, companies are always searching desperately for ways to limit costs.  Lower costs equals greater profits for companies, so you just need to be aware that there is no loyalty within the context of the free market system, and you can essentially be let go for any number of reasons.  Even government agencies are working to limit labor costs. You will need to view everything as temporary and be ready to adapt or adjust if you see change coming.

Credit Reports & Credit Ratings

What is your economic reputation worth to you?

Your credit report is a listing of all past and present obligations and the credit rating is a number that estimates how reliable you are financially.  Banks and other lending institutions look at your credit rating to determine whether to lend money to you and what price (interest) you will pay for the loan. According to Bankrate.com, a person with a poor credit rating borrowing $200,000 for a house will pay $127,000 more in interest than someone with a stellar credit rating.  This is insane.  

Image by Petr Kratochvil

Debt ends up costing you so much over your lifetime, so remember any unpaid bill lowers your score.  You can raise your credit score just by paying things like rent and utility bills on time.  The idea that you need a credit card to increase your score is silly because the credit card will encourage you to overspend. If you overspend, by definition you have spent more than you have, so you will not be able to pay the bill.  

The credit card company will happily add interest to the remaining amount and your debt grows.  This is called carrying a balance (aka: falling behind) and it lowers your credit rating while costing you more. If you are careful with a budget, you can utilize credit cards as a cashless payment system assuming you pay the bill off each month and there are no hidden fees. Read all credit contracts carefully; better yet have your parents do it.  That’s why they are there. The problem according to Robert D. Manning in his book Credit Card Nation is that paying by credit cards does not hurt as much when you buy with cash, and this leads many to overspend and get into debt.

If your parents have given you a credit card for emergencies, then save it for true emergencies.  Pizza lust is not an emergency.  If you run up your parents’ bill, they will find out when the bill comes, so get permission prior to using it.  If you can’t contact them, and in your best judgment it is an emergency then use it, but let them know immediately.  Your parents are depending on you to not screw them, honor their trust in you by thinking hard before using the card.  If you screw up in judgment, be up front about it and accept the consequences.

Fiscal Sanity

Image by Andrew Bardwell

Debt is a prison that many of us voluntarily walk into.  That is how a trap works; we walk into it based upon some lure.  We see something we want, (ignoring warning signs of danger) we go get it, and we suffer.  Debt represents all the money you owe and have not yet paid back, so when you owe money to someone you essentially become their slave (Proverbs 22:7).


Creditcards.com states that the average American household owes more than $15,000 on their credit cards. Furthermore, the ongoing housing crisis is devouring many families, and few have any savings for retirement.  Can you escape these traps, or are you doomed to eventually be swept up in the random nature of the business cycle?  Now that you are a legal adult, you are allowed to enter into contracts, but beware that contracts are binding.  If you make a bad choice here, your parents can’t get you out of the contract.  


Credit cards offers are going to be available everywhere you go, and you need to be very careful because some of the contracts will cost you money even if you do not use the credit card.  Those freebees and gifts offered by credit card vendors can lead to serous debt.  A lot of people put down false information on the application to get free stuff, but it isn’t worth the compromise of your values for a free Frisbee or t-shirt.  At this phase in your life, you should avoid credit cards.  


You do not need to walk into debt, but folks tend to run up the bill as long as additional credit is issued.  They have lost the sense of the enormity of their debt and give up all hope of paying things off.  The bottom line is that when you borrow money you have an obligation to pay for it because taking something without paying for it is stealing.  Jesus’ most talked about topic is money, so you can learn much about how to handle yourself financially when you live according to the Word of God. 

Nurturing the Boomerang Generation

Image by R. Pollard

First some definitions for this post…

Boomerang Child: A boomerang is an adult, age 18 or older, who moves out of the family home for a time and then moves back in.

Deadbeat Child: A deadbeat is an adult, age 18 or older, who is not going to school, living with parent(s) or friend(s), is not working or looking for a job and does not help out with household or yard work chores.  This is not to be confused with a deadbeat parent who is failing to pay child support, but I’m sure there is a strong correlation among the two groups.

Some boomerangs are deadbeats, while some deadbeats are not boomerangs because they never left in the first place. 

There are many young adults who are living outside of the home only through substantial parental financial support, so in reality they are not financially independent.  These folks will escape the disdain of society because they look like they are successful, but their parents may view them as deadbeats.

The Situation

The Pew Research Center had the following startling facts on boomerangs:

• 29% of boomerangs say they’re satisfied with their living arrangements

• 24% of boomerangs moved back in with their parents their own because of economic conditions.

• 61% of boomerangs say they have friends or family members who have moved back in with their parents over the past few years because of economic conditions.

• Those without a college degree are twice as likely as those who have graduated from college to be living with or have moved back in with their parents (22% vs. 10%)

• 32% of 25-34 year olds receive substantial financial support from their parents. 

Stats on deadbeats are difficult to flesh out (I tried, really) due to the subjective definition of a deadbeat.  I’m just going to assume the number of deadbeats is on the rise.

What does this deadbeat trend mean to parents?

While the Pew study cites the troubled economy as the leading factor for boomerangs.  The growth of deadbeats in our society has a lot to do with our over-permissive and overindulgent parenting styles.  (Pr. 3:11-12) (Pr. 13:24) (Pr 19:18) Christian families are also falling prey to this as more and more parents equate permissiveness with love.  This is one of the main reasons for the decline of our society. 

Christians should not be surprised by this trend, but we should take note as we deal with our children (Eph 5:15-16).  As more and more of our kid’s generation become deadbeats there will be a general expectation that this type of lifestyle will be accepted in your house (1 Cor. 15:33-34).  You will have to work harder to reinforce your expectations that they grow to be independent.

A Biblical Way Forward for Parents

We as parents must nurture our children towards independence.  In addition as Christians, we should aspire to instill a strong sense of devotion to Christ. (Proverbs 22:6) (Ephesians 6:4)

Discipline is going to look different for each family as well as for each child.  Their personality bents, interests, and gifts seen through the light of scripture should determine our methods (Proverbs 22:6).

David failed to discipline his son Amnon for raping his sister Tamar.  David was angry but did nothing.  David’s guilt from his adultery with Bathsheba and murder of her husband made him less willing to do what needed to be done.   This inaction led to the death of his sons Amnon and Absolom, as well as 20,000 Israelites in a costly civil war.  (2 Samuel Chapters 13-18)

A Biblical Way Forward for Adult Children

If you are a young adult reading this and you are not doing enough to contribute to the household or doing enough to move towards independence, you will probably be kicked out soon.   Ditto, if you are living with a friend. 

Living the life of a deadbeat is a life of sin.  Confess your sins to God.  Change and get to work. (Pr. 10:1) (Pr. 10:4) (Pr. 12:24) (1 John 1:9) (Pr. 14:23)

If you are a young adult receiving financial support then sit down and talk with your parents about their expectations of you.  Communication is key and all parties have to do their part.   Why wait until the door locks are changed and your stuff is thrown out on the front porch?

This post is a part of the Christian Writers Blog Chain.  Check out other great posts by clicking on the links on the left.



Please comment I really want to hear your take on this difficult and interesting subject.

Lost Wages Due to Delayed Graduation

The above chart illustrates that time is money.  The idea is that you are losing out on wages for every additional year needed to complete your degree.  The longer you take to complete your degree the more you are holding back your career and many of your later financial goals.  If you are borrowing money (as most are) to pay for college, then your student debt will be higher the longer it takes.

When you complete your degree, you begin a slow upward march up the pay scale.   As your experiences increases, you become more valuable in the job market.  

I know retirement seems a long way off, but many companies have retirement benefits. By completing your degree one year earlier, you are seriously compounding your retirement benefits and reducing your retirement age. 

Regardless of your feelings about marriage and children at this point in life, there is a good chance this will become more important later.   Let’s do some math: Assuming it takes seven years to get the degree, three years to get yourself set financially and get married, and another two years to have children; you would be 30.  Now it’s possible to have children at 30, it’s just harder.  According to Sara Rosenthal in her book, The Fertility Sourcebook  at age 25 there is a 78% likelihood of getting pregnant but by age 30 it drops to 63%, and by age 35 it is down to 52%.  

Most college bound people have been taught to hold off on children until the career is set and that is sound advice.  I would just add that you need to make sure that you don't extend the education aspect of your career/education/family timeline.

Life needs to be done in order, but it also needs to be done with purpose.  There is a window of opportunity where getting a college degree is the easiest.  The longer you wait to finish your degree, the more likely you will be handling increased responsibilities while going to school.  It just gets harder over time. Get it done quickly, so you can move on to other areas of your life (Proverbs 24:27).  This is the golden rule of college: The longer it takes the more likely you will drop out. 

Boom vs. Bust

In economics we teach something called the business cycle.  The idea is that economies tend to have ups and downs.  We can be in a growth or recessionary part of the business cycle.  While it may feel as if we are in a recessionary cycle, you need to know that by classic definitions of growth and recessions we have been in a growth phase since the third quarter of 2009!

The following graphic shows the growth and shrinkage (recessionary) cycles.

Gross Domestic Product is a measure of the total wealth generated inside of our country.  A recession is defined as two consecutive quarters of GDP shrinkage. 

Source: Bureau of Economic Analysis

Starting in 2007 we have had quite an economic ride with ups and downs.  Growth slowed again in 2011 but never went negative.   Remember that it is possible for a company to have more profits with less workers.  This is due to ever increasing productivity.  This is how the nation can have a growth in GDP with a decline in jobs.

The following chart measures unemployment levels:



Source Bureau of Labor Statistics



Are you are still with me?  Then you deserve the punch line:  In your life you will face many turns of the business cycle and you should plan for these ups and downs.

Go to the ant, you sluggard; consider its ways and be wise! It has no commander, no overseer or ruler, yet it stores its provisions in summer and gathers its food at harvest. How long will you lie there, you sluggard? When will you get up from your sleep?  A little sleep, a little slumber, a little folding of the hands to rest— and poverty will come on you like a bandit and scarcity like an armed man.    Proverbs 6:6-11

There will be times when if are breathing and willing to work you can find a job and get pay raises easily.  There will also be difficult times where work is hard to come by.  Each phase of the business cycle requires a different strategy.

During Good Times

Resist the urge to increase spending and begin putting away savings for the lean years.  Do an analysis of your skills to see where you are vulnerable for any possible downturns.  Maybe you can work less and bank those hours towards college credits.  Some companies are more liberal with benefits like subsidized education.  Take advantage of this and invest in your education.  Increase giving.  God had given you more so you should bump up both your tithe and giving during good times.  Resist the urge to job hop looking for continual raises.  In union jobs, you are giving up seniority when you move companies.  The bad times are coming so you should prepare.  If possible use this period to start a sideline business. Resist the urge to get caught up in get rich quick scams and focus on the basics for growing wealth.

During Bad Times

Be thankful for what you have and do not harden your heart towards those who drop into poverty.  Help where possible, hire someone if you can.   If you lose your job, don’t give up looking ever.  Drastically cut spending where possible to preserve savings for a possible long unemployment.  Divide time between your sideline business and job hunting.  You may have to adjust your expectations and take a lower paying job.  If the new job is lower paying you must adjust your spending to the new reality.  This is hard, but the whole family needs to take a pay cut.  Ironically this is the best time to invest.  It may be scary to think about investing because you may be afraid of locking money away that you may need due to a job loss.  Realize that your job is not secure even if it seems secure, so you must take reasonable investment risks at times.  This may be the best time to buy your first house.

Learn this lesson about the current economic climate.  You can’t trust your feelings to gauge the times so you should follow these basic strategies so that you can safely ride out the business cycles that you will experience throughout your life.  Many of the people around you will be reacting improperly because they do not understand the business cycle.  When investing the rule is to buy low and sell high.  This sounds easy but will cut against your feelings because the best time to buy will be when prices are falling.

You don’t operate in a bubble and not everything is under your control.  Even with good economic decisions you may still get wiped out through some freak event.  This is the natural hazard of being a living being on this planet (Ecclesiastes 9:11).  The idea is to limit self-inflicted financial wounds. 

Choose your Destiny

Take a good, hard look at the timeline. The right side portrays a path of life that involves quickly getting through college successfully, working hard at your career, and making good money choices.  On the left is an alternative destiny.  It involves having fun and living it up under your parents’ house.  If you choose the party life, there will come a point where your parents will get tired of this.  I call this moment the “deadbeat threshold.”  At that point, your parents will kick you out because they finally get it that by supporting you financially they are not helping you mature.  You are not progressing in life and are stuck.  Fed up, your parents serve your eviction papers thus ushering in a life of poverty that will ensnare you and the generations to follow Proverbs 10:1.

I don’t think people say, “Hey I want to be stuck in poverty all my life, how do I go about doing that?  The reality is that poverty is the natural outcome of a life that is done out of order.  If you have children before you complete your schooling, it will be very difficult to finish your schooling.  Do life in order, it’s education, career, then kids.  Get it out of order and you will be in poverty.  Looking at the graphic, please notice how a person who starts work immediately is getting things out of order.  The party life will lead you to the poverty life, because you will be neglecting the things that could enrich your life in the long run Proverbs 21:17.

            Living for God and being a partier is incompatible (Eph 5:18) (Gal 5:19-21) (James 4:4) (Prov 23:21).  Partying will not make you more popular, because people are popular because they have traits that people value.  Don’t get caught envying the “beautiful people” who are having a great time, God has other plans for you (Prov 23:17).  Their lives are a mirage, because the glamour will fade away and you will have purpose.  People who like others because they are attractive are vain, so why would you want those types of people as friends.  Find people who share the same values as you and you will be happier.