Finance
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Resource
Management |
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President Benson, 13th president of the church said, "I would respectfully urge you to live by the fundamental principles of work, thrift, and self-reliance, and to teach your children by your example. It was never intended in God’s divine plan that man should live off the labor of someone else. Live within your own earnings. Put a portion of those earnings regularly into savings. Avoid unnecessary debt. Be wise by not trying to expand too rapidly. Learn to manage well what you have before you think of expanding further. This is the kind of advice I would give my own, and is, in my opinion, the key to sound home, business, and government management. (Teachings of Ezra Taft Benson, Pg.262-263.
We all know people who make a lot of money but have little to show for it. They could be wiser in their spending and they don’t take care of the things they have. On the other side of the coin, we all probably know a few people who have modest pay checks and homes but they seem to find the money to take care of the important things in life. More important than the amount of money you make is what you do with your money and how you manage your belongings.
We can learn a great deal from people who lived during the Great Depression. A few years ago a grandmother died who had a young family during the depression. As her children sorted through her things they came across an envelop labeled, "Pieces of string to short to do anything with." These people learned through hard experience that if they threw something away they might not be able to replace it. In our present prosperous times most of us can run out and purchase a replacement item for something that isn’t even broken. Although it’s serviceable or could easily be repaired, it’s old, worn looking, the wrong color or for some other reason is no longer desirable. However, for every unnecessary purchase, we have that much less money left to take care of our other needs. "A penny saved is a penny earned" is a true axiom even today.
Depending on the figures you choose to believe, between 75% and 89% of all divorces in the United States have their root cause in money problems. For the health of our marriages alone, it behooves us to be wise stewards over our money and possessions. The leaders of the Church have put forward several important principles of money management. I’ll list just a few of them here.
- Be faithful in paying your contributions to the Lord: The Lord promises great blessings to those who take care of the Lord first. (Malachi 3:10-13) To someone who doesn’t know anything about tithing this may only sound like a money making scheme for the Church. However, for those of us who have put this to the test, we know as we take care of our financial responsibilities with the Lord that the money that's left will stretch much further than it would have otherwise.
- Avoid unnecessary debt: Under normal circumstances one should only go into debt for a house, a car, if one is truly needed, a business and an education. That’s it. This may require you to buy used items until you have the savings to buy new items.
- Start a regular savings plan: If you pay yourself and put it into a savings account instead of paying it to the bank for loans, you will have interest working for you instead of against you. There are many credit cards that charge as much as 25% interest. With sizable debts this can really eat into the money the family brings home. If you are in debt, put yourself onto a tight budget and get the loans paid off. As you begin to pay off some of the debts, increase the money you are spending on the unpaid debts so your monthly combined loan payment remains constant. Continue to do this until all your debts are paid off. Then, instead of spending the money you were using to pay your debts, put that money into a savings account. With your savings account built up, when you do need to make a large purchase, the money will be there. You won’t have to go into debt again.
- Make a budget: This needs to be done with everyone that’s involved in spending the family’s money. The majority of people get into debt because they can’t control their spending. You should consider your budget a financial plan for your family. Make a list of the things you want during the month and then categorize them with the most important items on top. If you always purchase the items on the top of the list first then stop buying when the money runs out, you should always have the necessities of life. If you buy the wants first, there will be times when you will run out of money before the family’s basic needs have been met.
My wife is the accountant in our family. Not only does she have the monthly necessities recorded but she has an annual budget worked up with annual expenses such as income taxes, property taxes, Christmas, annual insurance premiums, school tuition and things like this. In each monthly budget, money is earmarked for short-term savings to pay these bills when they come due. What happens in our family when something unexpected comes up and the money’s not there? If we can't responsibly borrow it from our short or long-term savings we do without it until it can be budgeted into the finances.
It takes real discipline to live within a budget but the rewards are out of this world. No Debt! I mean, none at all. You will feel a great feeling of satisfaction when you know the monthly utility bills are the only things you’re going to dig out of the mail box. |
