Proverbs tells us that a foolish man spends all his income. "In the house of the wise are stores of choice food and oil, but a foolish man devours all he has." Prov. 21:20, NIV. It is foolish to simply break even, and how much more to get into debt. God does bless His people. Christians comprise a third of the world population, but control two-thirds of world wealth.
Larry Burkett noted that old age is a time for which to store provision. Prov. 6:6-8 "Go to the ant, you sluggard; consider its ways and be wise! 7 It has no commander, no overseer or ruler, 8. Yet it stores its provisions in summer and gathers its food at harvest." Our earning ability declines typically in the 60s and 70s, so we need to take measures to prepare for that time.
Prov. 27:12 "The prudent see danger and take refuge, but the simple keep going and suffer for it." Emergencies, including car repairs, illness, and loss of a job, require savings. Knowing these possibilities, we need to prepare. An emergency fund is prudent, in light of this scripture.
More mundane are annual fluctuations in heating bills, or vacation expenses, and gift-giving, for which planning is appropriate.
Long range planning is required for higher education, the education of children, and retirement. The fact of death requires provisions of a will, burial expenses, and for ongoing financial needs of our family.
As Bill Gothard has noted, our planning requires faith (Rom. 14:23c NIV, ". . . everything that does not come from faith is sin." Therefore the guideline is: "What has God given you the faith to believe Him for?" When we plan in faith that God approves our goal, then saving is in order. This requires both self-control and self-denial. It is not hoarding, which has no particular goal and no end.
Christ has taught us not to lay up treasures (thesauros) on earth. . . (Matt. 6:19), but store up for yourselves treasures in heaven. . .(6:20), "For where your treasure is, there your heart will be also." "No one can serve two masters. . .You cannot serve both God and Money." (6:24 a,c). So greed is actually idolatry, as the Spirit wrote through Paul (Col. 3:5). In our consumer culture, we need to major in giving, and minor in saving.
How can we lay up treasures in heaven? Jesus told the rich young ruler, "If you want to be perfect, go, sell your possessions and give to the poor, and your will have treasure (thesauros) in heaven. Then come, follow me." (Matt. 19:21). Precisely the issue of two masters was at stake. The ruler's heart was set on his possessions, so Jesus told him to transfer his assets, so his heart would be set on God. But this same admonition is given to Christ's disciples. "Do not be afraid, little flock, for your Father has been pleased to give you the kingdom. Sell your possessions and give to the poor. Provide purses for yourselves that will not wear out, a treasure in heaven that will not be exhausted, where no thief comes near and no moth destroys." (Luke 12:32-33). 2 Cor. 8:14 teaches us that our surplus should help others, if we have a surplus.
What testimony does our allocation of financial resources bear to the identity of our master? Where is our treasure? Because of the comparative wealth in Europe, America and some other European-origin countries, we must recognize and resist worshipping the idol of Money, and the velvet path of desiring personal pleasure, security, and comfort—creating heaven on earth.
Are we putting more into our 401(K)'s, IRA's, and investment portfolios than into the work of the Kingdom? The best way to answer that is to ask, "Where is my heart, right now?" Is the focus of my life retirement or a higher standard of living? Or are we seeking first the Kingdom of God?
Suggestions for saving:
- Save regularly, preferably as a payroll deduction, so no monthly decision will have to be made, after giving the Lord His portion (Prov. 3:9-10).
- Make it hard to withdraw the cash. The deduction could go to a distant bank or to an out-of-town mutual fund. When you save enough cash, move to a CD or money market fund with higher interest. One of the best ways to save is by a Dividend Reinvestment Program (DRIP). You can purchase stock shares of companies that offer DRIPS at very low cost and you establish automatic withdrawals for this purpose. The money goes far away, it is takes longer to cash in stocks than to withdraw money from a savings account, so is less likely to be “raided” on impulse. More information is at www.dripadvisor.com/
- The earlier we to save, the better, with compound interest.
- An Individual Retirement Account allows most people to save $3,000 per year per spouse (2004), the earnings of which are tax-deferred (Traditional) or tax-free (Roth).
- Take advantage of 401-k company plans, which both reduce adjusted gross income and deferred tax on the investment, in addition to any matching funds.
- Try to pay off your home, if you plan to live there for some years. Pre-paying the mortgage will earn the equivalent to the mortgage rate. Then concentrate on other long-term savings.
- Train your children to save a portion of their income, some for short-term and some for long-term goals.
- When savings accumulate, convert them into higher rate plans, such as CD's or mutual funds with minimum deposits.
- Match your tolerance for risk with the kind of investment.
- Read. For example, the Sound Mind Investing Handbook, by Austin Pryor ( see www.soundmindinvesting.com ). Periodicals such as Money, Forbes, and Kiplinger’s are good sources, as is the Motley Fool www.fool.com. Seek expert counsel.
- Eccles. 11:2, "Give portions to seven, yes to eight, for you do not know what disaster may come upon the land." seems to support the idea of diversifying investments. Certainly the principle of sowing and reaping applies to investing, generally (Eccles. 11:6).