Am I LOST financially?

If you have been checking out this site for some time you know by now that I base my financial principles around what scripture (Bible) says. There is a reason for this: it is smart.

I actually like to call the bible our map. If we are lost financially we might have to evaluate if we are following the wrong map. How do I know if I am lost financially?

• If you get to the end of the month and you do not know where your money went
• If you are not giving sacrificially
• If you think that if you were able to get just a little bit more money then you’d be happy
• If you are worried about your finances
• If you find yourself into debt (other than the house)

Like I have said before, most of Americans are in a stressful situation (The Wall-Street Journal published that 70% of Americans are living paycheck to paycheck). This means if they missed one paycheck they would not be able to make ends meet.

A definition of instanity is doing the same thing over and over again and expecting different results.  If we follow the map of culture, why do we think it will end up with different results?  Are we following the wrong map?

Lessons from the Masters

Yesterday I got to attend an experience of a lifetime and went to Augusta National to see some AMAZING sights at the Masters golf tournament

Some points of interest:

• The prettiest greenery I have EVER seen…didn’t even imagine it could look like that.  Can I make my yard look like that?
• Golfers in real life CRUSH the ball.  It is unreal.
• Food at the Masters is ridiculously great.  I got like 4 sandwiches and 3 drinks throughout the day for less than $10!!!
• Tiger Woods can draw a crowd…and I mean DRAW A CROWD.  We watched him hit off the practice tees and I felt like this was the scene where Jesus was teaching in the house that was PACKED and some dudes helped their paralytic friend go through the ceiling just to see Jesus.  People were climbing trees just to get a glimpse of Tiger.
• While food prices were low…Gift shop prices were high…VERY HIGH.

It was a bit unusual, people (including us) were standing in line just to get in the gift shop.  To spend money on the most overpriced merchandise.  And you know what…it was contagious.  I began thinking all the things that I was going to spend money on and the tally was racking up.  If it weren’t for the fact that as soon as I got in, it was a mad house (10 times worst than Black Friday), I would have bought stuff.  I had to escape as quickly as possible so I ended up not spending money.

But it made me think how impulsive of a shopper I am.  I really was about to spend some major money just because it is easy for me to catch the shopping fever.

I do not know why I am an impulse shopper but it is my nature and I have to place solid guidelines in the arena in my finances for the rest of my life to truly combat this.I get what I like to call “buyer’s remorse.” I will be super excited about something and then get it, I get into this funk where I feel guilty and stupid for spending so much on it.

I find myself time & time again giving into impulse rather than patience.

I have learned (and continue to learn) this about myself. Therefore I have implemented what is called the $100 rule in my life.

For every $100 that I want to spend on a purchase, I must wait one day before I make the purchase.

If a new purchase costs $100, I have to wait one day until I can purchase the item.

If a new iPod costs $400, I have to wait four days until I can purchase the iPod.

If a new MacBook Pro costs $1400, I have to wait two weeks until I can purchase the MacBook.

By doing this I have a built in period where I can fight impulse. If you find yourself wired like me, implementing healthy guidelines can absolutely aid to transitioning from being in a financial mess to being financially free.

And just to be honest, this built in time allows the holy spirit to get a hold of me and I can be sure if I am making purchases to advance the kingdom or if I am just being selfish.

Money causes Conflict & Confusion

I have noticed that if we are not careful money can cause conflict & confusion quite easily.

CONFLICT

I was in a grocery store the other day and saw a kid melt down because he wanted to get something that his mom would not let him have. At first I thought how embarrassing that looks and then how thankful I was that I never did that as a kid (…right).

I realized that this was a conflict that was caused by money. It causes conflicts across the board: teenagers and parents, married couples, little kids in toy stores…it is messing stuff up all over the place.

CONFUSION

Money also causes confusion. I think that 2 groups that have a major role in people’s confusion is the church and the educational system.

It is strange that a senior can graduate from high school and can dissect a frog, know the Pythagorean theorem, and can tell you the symbol for Sodium but cannot balance a checkbook or recognize a good interest rate.

It is so funny that major outlets of teaching will ignore the most practical thing people need to know. And when I mean ignore it, I mean never bring it up period. Then when someone is faced with financial decisions they are hit flat in the face without any experience. Maybe that is the reason why more people will declare bankruptcy than graduate from college this year. It is because we’re confused.

Money can be dangerous stuff, you better know how to handle it. Jesus talks a lot about money.  Scripture teaches us how to handle it.  It really does matter.

Set a Goal – Alternative Income Streams

I am a goal oriented person so I naturally think setting goals are helpful.

Last night I went through all 2008 financial info for the Kakaras family.  I am organizing them for tax return preparation (no I’m actually not doing it myself, this year I wanted a professional to do it).

However, I did a quick excel spreadsheet version of what my tax return should come out with just so I can have the ballpark in mind that we are working with.  One thing that I was surprised by was the amount of alternative income streams from 2008.

It was neat looking back and adding up the different places I had received money: promotional bonuses from opening bank accounts, interest earned, and other 1099′s I received.  It made me want to set a goal for alternative income streams for 2009.

One of a major goal of mine is for one day to have my alternative income streams be greater than my expenses.  At that point life is completely different and I am actively thinking through ways to take steps towards this.

I thought this last night and figured it would be a good challenge to throw out to everyone.  “Set a goal for alternative income streams in 2009.”  It can look like whatever you want (start a blog, make an investment, earn a better interest rate on your savings accounts, think of a small side business that you can start, etc.)

Everyone is different so it will look different for each person but think about setting a goal for alternative income streams in ’09.

Awareness is Necessary

I have said before that I do not like to motivate people with guilt.  This is not an appropriate emotion to be a catalyst to action.  Guilt is not Helpful.  Awareness is Helpful.

In America, I get caught up in stuff and comfort.   Yes, by God’s grace I do snap out of it, but it is too important to be aware of the reality of our financial life.  Here is what I mean:

If 100 people represented the world’s population, 53 of them would live on less than $2 per day.  A person who makes 24,000 dollars per year makes 50 times more than the average person on this planet.

Which is more messed up: that we have so much more than everyone else in the world or that we don’t think that we are rich.  (I received this from Francis Chan’s book: Crazy Love)

It is necessary to understand this.  The only reason why we are not content in our finances is because of greed.  No matter how far back you look, this is the root issue for contentment.

Philippians 4:12-13:

“I know what it is to be in need, and I know what it is to have plenty. I have learned the secret of being content in any and every situation, whether well fed or hungry, whether living in plenty or in want. I can do everything through him who gives me strength.”

Take a Look…It’s in a Book

We are hungered for entertainment.  Our culture consumes anything that is entertaining.  Movies, Music, Internet, Games…we just love them.  And it is easy to spend an exuberant amount of money on our entertainment.

However, one thing I never understood was…how come people don’t like books?  Now, I know the average person dabbles in em, but I am talking about a person who likes books as much as a movie.  Think of how much time you spent watching tv this week, or last week.  Okay now ask yourself how much time you spent reading?  If you are a typical American, they do not even compare.

Here’s the funny thing…Libraries offer books for FREE.  So not only do we reject reading books, but people are literally GIVING THEM TO US and we still would rather see an $8 movie or buy a $50 game.

It’s just fascinating.  The average millionaire reads 1 non-fiction book a month.   Not that our goal is this but I figured it is worth mentioning.

So my tip of the day is as follows:Use the Library

The library is awesome. It has all the books that I love (more importantly the books on tape that go with it), tons of movies that I love, and it is all free which I really love.  I suggest that we take advantage of the opportunity known as the Library.  Not only is it entertaining and free but you might also learn something.

Lost Bomb

So, I am an avid LOST watcher.  I got caught up with the DVDs around season 2 and have been hooked since.  I love the show.  It is so entertaining and I very rarely get frustrated as some do.  I just enjoy my time watching it and do not have preconceived expectations.

However…last night a “bomb” to say the least, was dropped during the episode that changes EVERYTHING.  This is not a sale’s pitch for the show I am just explaining my reaction.

Everyone that I was watching it with was as shocked as I was and it immediately threw us into a frenzy of conversation for what this meant for the show.   We all agreed that this could be a catalyst that causes a chain reaction of many things within the show.

I am about to tie this into our lives…ready for it?

You know this happens to us too?  I mean in life.

There are things that happen to us that are “bombs” that get dropped on us that change everything, and many times that includes our financial life.

Some may call these “emergencies.”  Now before you stop reading this post and get turned off because I am about to talk about an emergency fund let me ask this question.  Do you have an emergency fund?  Most do not.  If not, keep reading.

Money Magazine says that roughly 4 out of 5 people will have a MAJOR NEGATIVE financial event in any given 10 year period.  Something is very likely to happen.  Wouldn’t it be wise to arrange your financial life so that you are prepared when that event does happen.

Just something to think about.