Financial Authority: Part 1 - No Personal Financial Ignorance

Operating in the financial place that is outlined for Christians in the Holy Bible will require that we first put to an end all instances of personal financial ignorance.

No disrespect is intended here.  Let’s break it down.  

Ignorance is having a lack of knowledge or information.  Ignorance is in no way related to intellectual capacity as is often implied in our conversations.  Ignorance is being unaware, unfamiliar, inexperienced and unenlightened.  Ignorance can exist because of isolation, limited exposure or more deliberate measures.  For this reason I believe that in today’s overabundance of information, being ignorant is a choice.

Personal financial ignorance can be described as being uninformed of the details of your own personal financial situation.  Is that possible?  Sadly I must say that it is possible.  This is a clear measure of financial immaturity that I’m praying will be resolved for all Money reVerse followers starting with this blogpost!

Let's go to the verses… Know the state of your flock

Be diligent to know the state of your flocks,
And attend to your herds;

For riches are not forever,
Nor does a crown endure to all generations.

When the hay is removed, and the tender grass shows itself,
And the herbs of the mountains are gathered in,

The lambs will provide your clothing,

And the goats the price of a field;

You shall have enough goats’ milk for your food,

For the food of your household,

And the nourishment of your maidservants.

                                    Proverbs 27:23-27  NKJV

These scriptures, located in the Bible book of Proverbs, served as instruction to those in biblical times to be aware of what’s going on with their flocks and herds.  Let me paraphrase these passages:

Having riches at one point in your life does not mean that you will have them forever.  If you don’t consistently take care of the money that you have, is it very possible that your future generations will not benefit from it. (As noted throughout the Christian Holy Bible, the family lineage and importance of making plans for future generations is very important.)  If you take care of what you have, you can have enough assets to cover your needs and/or be sold for lot of money.  Guess what?  By being consistent and particular to carefully manage your financial resources, you can take care of everyone in your household along with the hired help that you’ve engaged!  All of this if you will be relentless about knowing what’s going on with the money you have today.  

In biblical times an individual’s wealth was determined primarily by their cattle inventory.  Here’s an example of how one rich man, Job,  was described.   

There was a man in the land of Uz, whose name was Job; and that man was blameless and upright, and one who feared God and shunned evil.  And seven sons and three daughters were born to him.  Also, his possessions were seven thousand sheep, three thousand camels, five hundred yoke of oxen, five hundred female donkeys, and a very large household, so that this man was the greatest of all the people of the East. 

                                                                    Job 1:1-3 NKJV 

                                                                                                                                        

The modern-day adoption of the instruction of being diligent to know the state of your flock is to be diligent to understand your personal finances.   To take this further, to know the state of your finances is to know the details of your personal fiscal matters at a particular point in time.  

To know the state of our financial matters we should be able to speak intelligently as we answer at a minimum the following  7 questions about ourselves:

- How much money am I expecting to earn this year?  How is this compared to what I expected to earn last year?  How am I tracking to this goal at this point in time? 

- How does my monthly income compare to my monthly expenditures?  Am I living in deficit or surplus? (When income and expenditures are equal we are living “on the money”.  This rarely happens but it is possible...)

- How am I handling the monthly deficit or surplus identified in question #2?

- How much debt do I have?  How does this compare to my income (debt to income ratio = debt / income).  How does this debt to income ratio compare to my debt to income ratio this time last year?

- How much savings do I have?  How does this compare to my savings this time last year?

- What is the value of my personal assets (real estate, automobiles, stocks, stock derivatives,  bonds, mutual funds, investments, collectibles, business valuation if sole proprietor or partnership)

- What is my financial credibility rating (credit score)?  How does this compare to my credibility this time last year?


Answers to these questions will give you the state and condition of your current personal finances.  We’re not addressing future plans, goals and aspirations at this point.  Current state only in this first step.  To take this a bit further, every 6 months I prepare a statement of my financial condition that I could deliver as an elevator speech.  But I don’t share it as a speech and never discuss this on an elevator.  This is for me.  Likewise your personal financial condition is for you...

How do you get to knowing the state of your flocks?  A major  key to achieving the financial headship that is outlined for us in the Christian Holy Bible is to consistently track and manage your weekly and monthly income and expenditures.  From that consistent tracking, a summary of key data points will get you the data that is needed.

The scripture didn’t instruct us to know that state of our flocks and herds only when they are doing well.  If it's yours, you should know it’s condition - even if it isn’t good right now.  This is the foundational step for getting our finances aligned to Christian biblical scripture.  

We're going somewhere but we've got to get our ticket here!!  If things have been rough for you recently,  it will take courage to sit down and do this.  You have what it takes! Just by completing this step things are already getting better!!  

Can you commit to getting a detailed understanding of your financial condition within the next 14 days or sooner?  I'm doing it.  Join me!

Carolyn

Click here to see the previous post in this series!

Halftime Checkup - 2014 New Year's Financial Resolutions

Halftime question:  How much have you progressed in reaching your New Year's resolutions?  Are you still on track?

Many of us struggle in setting goals and sticking to them until completion.  I’m included in this category in some areas of my life.  A study conducted by the University of Scranton reveals that only 8% of people that make resolutions or set goals at the first of the year actually reach them.  Statistics show that after the second week of January 29% of New Year’s resolutions are prematurely abandoned.  I find that I along with many individuals that I speak with clearly have the intentions of sticking to our personal goals but often end up with a story instead of a testimony when we report on our success.  

Financial Goals

Financial goals seem to be a part of our New Year's resolutions of many.  Commonly seen financial goals include managing personal finances with a spending plan, improving savings balances, maintaining a good credit score and getting out of debt. Achieving these goals will require flesh focused sacrifices.   Money that was once spent on last minute sale items, sporting events or an unplanned dining out experiences must now be redirected toward actions that lend themselves to meeting the established financial goals. Taking the actions steps to achieve these goals may appear to become difficult, boring or time consuming - especially if these are actions are outside of your normal ways of operating.

And let us not be weary in well doing: for in due season we shall reap, if we faint not.         

                                                  Galations 6:9 KJV

This scripture is speaking to us about our flesh - our physical body and our real world circumstances.  When we grow tired of a situation we tend to say “I don’t care anymore”.  When we let ourselves grow tired or weary, we’re giving our flesh a loaded gun and our most desired goals and objectives are in the direct line of fire.  We begin having casual conversations with the strongest negotiator that we will ever meet -  our flesh.   At the end of these casual conversations we begin vocalizing self-destructive  things like “I’m sick of this”, “I’m tired”, “I’m taking a break on this” and “I’ll get back on track tomorrow”.   In the blink of an eye we’ve compromised our goals and our financial breakthrough!

If you've grown weary in your quest to meet your financial goals I'm hear to encourage you to press on.  It's not over - just halftime.  There's another half to this year and let's regroup!!  Here's three tips to help you to maintain your strength as you regain your momentum in meeting those financial goals that you set at the beginning of the year.

1.  Define what weary means to you when you set the goal so that you will recognize the symptoms.

but God is faithful, who will not suffer you to be tempted above that ye are able; but will with the temptation also make a way to escape, that ye may be able to bear it.  

                                                                                                      1 Corinthians 10:13 KJV

You will be tempted to quit and turn back while on your improvement journey.  The temptations will come but they won't be anything that you cannot handle and overcome.  Know your weak points in this area and identify these sabotaging conditions and detail what you will do to overcome them.  Will you be tempted to stop taking your lunch to work based on the untruth that the little bit that you’re saving isn’t making a difference?  Will you seriously consider that you can again spend money earmarked for paying a bill and buy those unbudgeted Girl Scout cookies?  These are financial sabotage temptations that you can escape.  Detail what you will do in these situations and in advance declare the victory on paper.  Write it down so that you can reflect on these action steps as often as needed!

2.  Make note of the “Little Victories” along the way.  They are reminders that your actions are making a difference and getting you closer to your goal!

The light of the eyes rejoices the heart, And a good report make the bones healthy.

Proverbs 15:30 NKJV

  

Did you manage your spending for 7 days straight?  Write it down and celebrate it!

Did you save money this week by cutting your grocery bill?  If you did write it down and say so! 

Did you pay extra on a debt?  If so, write it down!

When you hear the lie that states that what you’re doing is not making a difference,  you have real evidence to squash this flesh negotiation tactic!

I once created a monthly newsletter that had a page to focus on these “Little Victories” when leading a debt reduction session.  Seeing these items in this newsletter was the highlight of the team  meetings.  How about sharing these celebrations with your social media friends and followers?

3.  Pray that your flesh is weakened as a part of striving to reach your goals.  

This I say then, Walk in the Spirit, and ye shall not fulfill the lust of the flesh.

Galations 5:15 KJV

Your flesh is weakened as your Spirit is strengthened.  If the flesh has little or no power to persuade you to quit, the battle is over before it begins!  If you brush your teeth each morning even though you are sleepy and groggy, your flesh has no power over you in the area of morning dental hygiene.  Pray that your spirit overpowers your flesh in those areas that are required for you to reach your financial goals.  

Ok… when it comes to those financial New Year's resolutions halftime is over.  We've gotten a bit of rest and the pep talk.  Get back into the game!  Each of us have a great chance of gaining a lot of ground in the area personal financial health!! 

Look for another checkup on this subject…











Carolyn

Get your financial documents organized!

In order to get our finances together we've got to get the related "stuff" together.  This is so important but often overlooked.  In our quest to improve our financial lives, take a close look at your everyday operational practices.  Simple adjustments can make big improvements!

Get control of the paperwork!

There are statements, receipts, and other artifacts that are a part of a healthy personal financial system.  These include bank statements, paycheck stubs, W2‘s, purchase receipts, service invoices, bills, discount coupons and insurance declarations and riders.  Without taking the time to properly manage these items they can easily end up in various hiding places that can make it challenging to be timely in getting bills paid and completing IRS income tax filings. It never fails that at the end of every year when the holiday decorations go up and family starts to arrive, I go off my routine of dealing with mail and placing these documents in their designated places.   If you currently have a system to store and manage these documents, recommit to operate in this system and take this time to get things back in order.  Create new files as needed for additional items that you’ve found should be tracked separately.  A test that I use is if I can’t tell someone where to locate a document it in less than 3 minutes it needs to have a better more identifiable home.

A simple system that I use for my active paper documents is to store them in semi-opaque plastic food storage containers with lids.  I place a visible label inside these containers to note it’s contents and stack these neatly in my home office closet.  The containers are inexpensively sold in multipacks in the kitchen storage section at your favorite department store.  I have active boxes for several categories including unpaid bills, paid bills, bank statements, insurance docs, flex spending receipts, dependent care, tax documents, investment statements and coupons/gift certificates.  At the end of the year I store the full container of docs in gallon size zip-top bags which I label appropriately.  Getting your paper records organized does not have to cost a lot of money!

Don't forget the digital assets.  Review the financial online archive policies and your personal record retention needs.

With each of our financial partners, we have the option to “go green” and eliminate paper.  Many of the statements and receipts that you get today can be delivered to you digitally or available online.  If you take advantage of paperless for any financial documents that you are required to keep you will need to ensure that you have a method to reproduce these docs at will.  This involves knowing how long you should retain the document and compare this to the online and archive retention policy of your financial partner.  If you will need to maintain your health care receipts for 7 years for tax audit reasons but but you can only see your pharmacy receipts for 24 months you will need to develop a plan to mitigate this difference.  If you store your digital receipts on your computer how will you recover this data if your computer hard-drive dies or your computer is stolen?  Make a list of the length of time you are required to maintain key receipts and statements and include on that list how you’re going to make sure that you’re covered.  Fill in the gaps of things that are not stored online for long periods of time by downloading them to your computer and ensuring that you’re backing this data up for safe keeping.  I find that this is a must for my post-tax monthly online brokerage statements.

Let this be a call to action.   Successful individuals tend to be organized and deliberate in their actions.  That's you and me.  Let's GO!! (Get Organized)

Do you see a man who excels in his work?  

He will stand before kings... 

Proverbs 22:29 NKJV

Carolyn