My co-host Zach has been quite busy in the recent month or so and though this is no excuse, we have been unable to do a podcast for quite some time. Fortunately, this dark period of audio silence might soon be coming to and end. The school year is almost over and that means a little breathing room for both of us.
We’ll see how full force the podcast returns, but at the least you can expect one this summer. Lately, we’ve been talking about finances and I’m sure that conversation will continue. We’ll chat about Dave Ramsey and Debt, mutual funds and student loans. Hopefully it’ll be something you’ll enjoy. Stay tuned…
Tag Archives: Money & Stewardship
Finances: a Global perspective
After looking back at some old post and the comments that followed about finances and what not, I thought it was worth giving some further explanation.
I use more then my share of the earth’s resources. (11 acres)
I see those things as problems.
A working definition of Poverty
I’ve recently started reading the book A Framework for Understanding Poverty by Ruby K. Payne. I’d highly recommend it to anyone (but particularly those who work with or live in poverty situations).
I’ll be posting a lot of my thoughts on what I read in the book over the next few days or weeks (it helps me to process information). Today, I want to talk about a definition for poverty.
Commonly when we talk about poverty we usually focus on finances. The national poverty line is measured solely on the income of an individual or family and takes nothing else into account. The first thing Dr. Payne does in her book is lays out a working definition of poverty: “The extent to which an individual does without resources.” This is a clear and simple definition which she goes on to further explain by defining resources as the following:
Financial: Having the money to purchase good and services.
Emotional: Being able to choose and control emotional responses, particularly to negative situations, without engaging in self-destructive behavior.
Mental: Having the mental abilities and acquired skills (reading, writing, computing) to deal with daily life.
Spiritual: Believing in divine purpose and guidance.
Physical: Having the physical health and mobility.
Support Systems: Having friends, family and backup resources available to access in times of need. These are external resources.
Relationships/ Role Models: Having frequent access to adults who are appropriate, who are nurturing to the the child, and who do not engage in self-destructive behavior.
Knowledge of the Hidden Rules: Knowing the unspoken cues and habits of a group.
Already, she has done such a crucial thing in expanding ones understanding of poverty and how it functions. I often point to the lack of support and relationships the poor have to help meet their needs. More specifically I usually point to the support structure that I have in place (family primarily) that would keep me from being out on the streets no matter what good or bad decisions I make.
Hidden rules are another section that speaks volumes to understanding the barriers one has to overcoming poverty. My dad works with people who are chronicly-unemployed and he talks about the need to teach some of the “hidden rules” of being and staying employed. These are things many take for granted and others simply never learned growing up.
This is an excellent book, and I got all that from just the first page!
Lot’s more to come.
Cost of Living: dictated by values, not income.
Financial Lesson #3: Live by your values, not your income.
I’m a little worried about moving on with so little feedback on my last finances post, but we’ll proceed anyways.
I think one of the BIGGEST steps we can make to healthy finances and Christ-like stewardship is to begin to live by our Values, rather then our Income. To make this conversation meaningful let me direct it to three different audiences:
Mr. College Student:
You are the one group I need to clarify something with: Most of you college students do not have an income. What does that mean? It means for a lot of you, you are going into debt to get yourself an education. Most folks would say that is a good thing, and some would say it’s not really debt, it’s an investment. I think I would agree with them, education is something I certainly value and I’m sure you do to, so this is a wise decision.
What does this also mean? It means you are going out to eat on the weekends, and bowling and buying concert tickets on money you don’t have. Going into debt on entertainment, does that align with your values?
Ms. Recent College Grad with the entry level job:
Congrats, you finally have your own income and are paying your own bills. It’s time to make some of those important decisions. There’s a good chance your still in debt for your school loans so some of what I said to the college students still applies. What that means is that you need to decided if it is more wise stewardship to pay off your student loans, or buy those fancy couches on lay-away.
I bet I know what most of you are choosing: your going to pay off the student loans, who needs fancy couches anyways? Especially you college students who had any exposure to global issues like poverty. To you folks it seems silly to buy a big screen TV for your living room when most folks in the world can’t put food on the table for their kids. That is your values speaking.
Mr. and Mrs. Nice job and In the money:
Hopefully your idealistic college days values are still in your mind. You have stepped into the world where the “American Dream” is possible and most would say necessary. You’ve got a better paying job and you darn well want to show it. You’ve been eyeing that BMW SUV and have kept your eyes open for a bigger home. And as far as everyone thinks there is nothing wrong with that: Higher Income = Higher Cost of Living. And suddenly your values are out the door. gone.
To clarify again I’ll leave you with a word picture and somewhat of a paraphrase of Luke 3:11*. Say your at home. A blizzard has just begun outside and you and your brother have to make the trek to school. You get to the closet first and see before you two coats. It’s quite cold outside so you take both the coats, leaving your brother with none. Is that what Christ called us to?
Now another word picture. You recently received a commission from your church to be a full-time missionary in your town. You don’t need to quit your job or anything, but rather just continue living and spend your time sharing the gospel with others. Here’s the neat thing: your church gives you a million dollar annual living stipend to support you. What does your home, car, lifestyle, etc. look like?
Financial Clarification
This is the third time I am trying to write this post to clarify where my thoughts and views concerning my financial lessons come from. The reason I felt it was important to try and do this was because I feel like a few readers have misunderstood what I am saying and I want to try and make sense of it. Let’s just say I haven’t found the right words yet. Here is my third and final meager attempt.
I feel like some of what I have shared of views on finances have come across as a masochistic, vow of poverty, money is evil standpoint. That is not what I have intended by the things I have written.
I am not a masochist. I don’t like Pain. I don’t think Christ enjoyed pain either, yet for some reason he endured the cross. Like Christ there might be times we sacrifice at our own expense for the sake of others. When I say Christ calls us to give sacrificially I don’t intend 1) for that to be painful, nor 2) to do it for the pleasure of it being painful. If anything I am a hedonist. I believe God created us to love others and he has equipped us with the resources to do that in a lot of ways. I say we give sacrificially because we were created to.
I am not promoting taking a vow of poverty. Christ did say blessed our the poor, but I don’t think he meant we should all try to become poor in order to be blessed. I am not saying become poor for the sake of becoming poor. Yet, I should be open to the possibility that my following Christ call to love and give to the needs of others might result in my becoming “poor” by the worlds standards. Jesus did not tell the rich young ruler to “become poor” but he did tell him to sell all his possessions to meet the needs of those around him. I need to be willing to go there if I am going to carry out Christ call on my life to love those around me.
I don’t believe money is evil. When I say we should practice giving away our money with out so much concern for whose pocket it ends up in I don’t mean to do it because money is bad and you might as well stick it through a shredder. (I should have said buy a bunch of bottles of Root Beer and candy bars and leave them in odd places through out the town). Money is simply a means of trade. We should be sure not to elevate it too highly. God calls us to be a good steward of what he has given us, and I have every intention of doing so. God also calls us to love our neighbors and care for their needs, and I have every intention of doing that as well. These both involve money, but I don’t think they are in conflict with one another.
I’ll leave you with this word picture that hopefully will help you understand my perspective. One day your walking along and God shows up and says: “You are my child and you can have anything and everything in the entire world that you would like.” This is better then winning a million bucks, it’s better then getting a genie and three wishes, you can have ANYTHING. A couple of things to keep in mind though. God says you should love your neighbor as yourself and we’ve got 6 billion of them. He is also not going to make things out of thin air, what you choose is from what is available on the earth currently. The more I take the less that is available to others. And by the way there is a big line behind you (6 billion) of God’s children who are going to choose from what’s left when your done.
So what do you choose?
Your problem with Giving is probably You.
Financial lesson #2: Giving
I think most of us, if we are completely honest with ourselves, are quite selfish even in our giving.
When I give I want it to be on my terms. I don’t like a knock on my window when I pull up to the stoplight asking for some money for lunch. They should know the only change I have is for emergencies and this doesn’t qualify. I’m much more comfortable knowing that I commited to paying $30 a month to sponsor a child, and it will cost me just $30.
When I give my hard earned money I want it to go to a deserving organization. I want to feel good about it. I often want to be recognized for it. I mean, after all, isn’t this my money I’m giving away?
Many of the thoughts I mentioned above are perfectly okay, but there are a few reasons that sometimes they are not. You see, a major part of the call to give is to teach you that money is not your god or master.
Take Jesus’ encounter with the rich young ruler* as an example (I’m not a ruler, but I sure feel young and rich). Did Jesus ask him to give everything he had so that the needs of the poor would be met? That was probably one reason. Most of us recognize though, that it was very much about him being willing to let go, and follow Christ. I far too often hear the response to that passage being that we aren’t required to give everything away, we just should be willing to if God ever asked it of us (and lo and behold I know not one person who God has ever asked to give away all they had).
Well today is the day. It’s time to for you to open your tight fist and release your tight grip on money, so that you can grip easily the hand of God. Today we stop making excuses and being self-centered in our giving, instead we give because we NEED to give to release our tight grip on money; to acknowledge that money is not our god.
Your Assignment for the Week/month: Take $100 (For most people with an income that’s probably less then half your tithe each month) out of the bank in $1 bills. Over the next month: give to anyone who asks, drop bills in places they’ll be found, try to give a dollar to a random stranger, hide them in findable places at work, drop them out the window at a school bus stop. Have fun, and give with no expectations or qualifications on your giving.
Discerning our Needs and Wants
Financial Lesson #1: Discerning your Needs and Wants
I told you my financial wisdom would not be overly complicated or deep, and lesson #1 is no exception. You must sit down (and if you are married, you both need to sit down) and draw up a list of your basic NEEDS (That you spend money on). To make this easy, do not start with what you see in and around your house, start with what you will be purchasing from this point forward. As an example person myself, here is an example.
Jack and Jill sit down and start their list of NEEDS. Immediately the basics come to mind: Food and Shelter. They break shelter down into clothes and rent (including heat, electricity etc). Now to get the money to purchase food they would need an income, thus their jobs. And to keep their job they each need transportation to work and occasionally work appropriate clothing. Jill thought back to here psychology days and Maslow’s hierarchy of needs and suggested they did have some ’emotional’ needs that might be hard to countify. In the end they came up with these needs: FOOD, SHELTER, TRANSPORTATION, MISC (Clothing, soap, etc) and EMOTIONAL.
But, that’s not the end of the lesson. Things get a little more complicated at this point. Does “Food” mean eating out three times a week and coffee at Bongo Java every morning? Are those NEEDS? You must discern on your own what part of your “food” is meeting your basic needs and what part is fulfilling your WANTS. The same goes for clothing. You might NEED button down shirts and dressy shoes for on the job, but you don’t NEED name brand clothing to wear out on the town. Getting to work is a Transportation NEED, driving across town to the outlet mall is not. Does that make some sense?
As you think through your needs, be sure to write down the things you’ve discerned are WANTS in another column (eating out, coffee, shopping trips, new sweaters).
Your Assignment for this week: Spend money as you normally have in the past, but be very concious of how much you are spending on Needs and how much on WANTS. Keep track of actual purchases if you’d like. And see if thinking through these lists actually changes what you spend money on through out the week.
…Lesson #2: Giving
Financial Wisdom: Is it really that difficult?
This will be the first of a small series of post I plan on doing on finances. I figured I should post this first entry both to introduce you to why I will be writing these post, and to create some accountability for me to make sure I do get this information out there.
I’ll start by saying that I have done a fair bit of reading as it relates to financial advice. I learned about Dave Ramsey this summer and read all of his books in the fall. I recently finished reading Rich Dad, Poor Dad. While on a brief financial kick in the past I’ve read Robert Allen’s stuff; The Millionare next door; and a slew of other books I found in the personal finances section of Border’s while Mindy does piles of homework. So, I’ve hopefully learned a little bit. And I must say most of these books have some pretty good advice. Many of them leave me ready to take action on making millions in some form or another, but usually that part of me settles down quite quick.
In future post I will share with you a little of the ways that I have dealt with my finances, and ways I hope to deal with them in the future. I am FAR from a financial expert, and nothing I’ll say here has stood the test of time (at least not that much time), but it is things I believe are steps in the right direction. I’ll try to be as honest as possible. Most of my values come from looking at the life and teachings of Jesus and trying to follow those. Some of the topics I’ll probably talk about is Needs vs. Wants, Fun Money, Giving, Saving, and living on what you need.
Since my life, and these views, are all a work in progress, I’d appreciate as much feedback as each person can give to the things that I share.
Real Estate with Ethics
I’ve continued to read Rich Dad, Poor Dad by Robert Kiyosaki and it continues to put this driving question in my mind. How can we invest in Real Estate in a way that is ethical?
Currently though only thing I’ve come up with is to do Real Estate in rich areas where it’s not directly affecting the poor. As I said in a previous post, so many options of making money in Real Estate seem to be doing so at the expense and oppression of the poor.
So, here is the deal. I want to make a lot of money. I want to make money so that I don’t have to raise it, or break my back working for it; I want to have money so that I can do all the things I desire to do and not have to worry about it. The stock market sounds interesting to me as does Real Estate. Lucrative business ventures are great too, but here’s my catch. I want to invest in things and in ways that I believe are ethical.
I’ll try the real estate thing, but not if it means ripping off someone just because they are in a tight spot, and not if it means pushing the poor out of their neighborhood, and not if it means charging oppressive rent prices.
I’ll try the stock market, but I don’t want to invest in companies that run sweatshops. I don’t want to support companies that make their millions in alcohol, pornography or the slave trade. I want to make money helping the world become a better place.
Anyone know of any good places to go for that kind of financial advice? Because I haven’t a clue.
The trouble with Real Estate
As a gift over the holidays, Mindy and I received the book, Rich Dad, Poor Dad. It had been recommended to me before and I had browsed the first chapter but hadn’t picked it up.
I’m currently a good chunk of the way through it and it brought up an interesting financial issue that I have. In the book Robert Kiyosaki will give examples of was that he made money. The two primary ways have been small stocks and Real Estate. I’ve read my fair share of money making and finance books and a lot of them, as well as plenty of people say there is money to be made in Real Estate.
You look at the ideas, me being somewhat of an entrepuneur, and your mind start whirling through all the possiblities and the idea of being able to make a ton of money quite quickly through buying and selling real estate (I know some of you are surprised by me talking like this). When I think only about the financial side of the real estate business, it’s quite tempting to try and jump in. And that’s when I step back and think about some of the social implications.
I’ll start with a typical example. Pick up your average ‘Make millions in Real Estate’ book and one of it’s tips will be to go to the bankruptcy office, or look for foreclosure notices, those are places to get houses for dirt cheap. Never have I seen in ANY book or tape or information anything that addresses the needs or situation of the person that is bankrupt or foreclosing. If anything it might mention that they’ll be glad to have the money, but I highly doubt they are glad to lose their house. “Your misfortune is my fortune,” that’s basically what it is, and that just doesn’t sound right to me.
The other major problem with real estate that I see is the power it has to push people around, particularly poor people. Gentrification is somewhat of a buzzword, but it’s happening and it’s frustrating and sad. Pick any major city and what’s happening is people with low incomes, but people who had a stable home, are being pushed out of their residence and left to move somewhere else. Now that the city has become popular again, those with money are forcing (I’ll explain in another post) out those without money. This includes housing projects (Cabrini Green of Chicago is now condos). This troubles me.
I like the idea of buying a house some day. I like the idea of living in community with people in a place that we own. I worry that my purchasing and profiting will be at the expense of others. There is oppression in the way we do real estate and I want to have no part of it. I only hope I can find out a way that is possible.