Build a solid financial foundation this New Year’s

                Happy New Year! January is a time when many people make personal resolutions and renew their commitment to live their lives the “right” way – by eating a healthier diet, exercising regularly and promising to do more for their families and community. It’s also a great time to establish healthier financial habits by applying biblical principles to a review of your financial situation and make any necessary adjustments. As always, when we turn to His Word, we find answers to our questions.

              Here are five important principles that should guide your financial affairs:

God owns it all.
The earth is the Lord’s, and the fullness thereof; the world, and they that dwell therein (Psalm 24:1 KJV).

                We are stewards of His resources, which He has entrusted to us to use for Kingdom purposes. The Bible teaches us that God wants us to enjoy the material wealth and possessions that He has blessed us with. Yet, with that enjoyment comes the serious responsibility to share those resources with others for eternal Kingdom impact.

                Consider your personal sphere of influence. Are you able to be more generous with your time and treasures at your church or to local ministries?

              During these tough economic times it’s especially heartening to remember that God owns it all. When we see the stock market soar one day and plunge the next, we can take comfort knowing that God is in control, and He will take care of all of our needs.

Spend less than you earn.
Wealth from get-rich-quick schemes quickly disappears; wealth from hard work grows over time (Proverbs 13:11).

              Living within one’s means certainly has not been the mantra of a secular worldview and the pursuit of the American Dream! Yet, there is a calming, peaceful freedom that comes from knowing you earn enough to cover your expenses, pay your bills each month and meet your financial obligations. We all work hard to provide for our families and live a comfortable life. That’s fine, but be thoughtful in your decisions about the “things” you spend money on because they are indeed only “things.”

Avoid debt.
Just as the rich rule the poor, so the borrower is servant to the lender (Proverbs 22:7).

              The realities of the modern world require us to accept some measure of debt, perhaps to finance the purchase of a new home or car. But our society’s reliance on debt has spiraled out of control. The current financial crisis is due in large part to the proliferation of sub-prime mortgage lending. Banks and other financial institutions loaned too much money to too many people who were not able to repay the debt. Those institutions fed the public’s need to “keep up with the Joneses” and poured oil on the embers that grew into a five-alarm fire. By avoiding the pitfalls of desiring exorbitant material wealth and too many “things,” we can avoid the abuse of debt and not fall into the financial trap that we see so many of our neighbors have fallen into.

Build liquidity.
Take a lesson from the ants, you lazybones. Learn from their ways and become wise! Though they have no prince or governor or ruler to make them work, they labor hard all summer, gathering food for the winter (Proverbs 6:6-8).

              Avoid tying up all your financial resources with too much debt or by spending entire paychecks on worldly possessions. Like the ant, focus on the long term, and plan ahead. Take steps to build up financial reserves by saving regularly in a checking account, CD, money market or other type of easy-to-access, FDIC-insured account. This builds flexibility into your financial foundation by setting aside money so that when an unexpected crisis occurs, you are prepared to deal with it. Building liquidity also provides you with the freedom and ability to give to others when you learn of their needs, and experience the joy that comes from knowing you have shared God’s resources for good works.

Set long-term goals.
I press on to reach the end of the race and receive the heavenly prize for which God, through Christ Jesus, is calling us (Philippians 3:14).

                Keep money in its proper perspective. Ron Blue, president of Kingdom Advisors, a Life that supports Christian financial advisors, refers to this as setting a financial finish line.

                Ask yourself, “How much is enough? Do I have enough? Will it continue to be enough to last for all of the needs of the rest of my life?”

                This will help you think about your finances in terms of an on-going lifetime journey, and the dynamics, the facts and the circumstances of this journey will change over time. It will also help you establish your own long-term plans to reach your financial finish line, while along the way living within your means, avoiding debt, building liquidity and sharing your resources for Kingdom impact.

              Take some time at the start of this year and every year to view your finances from a biblical perspective. Chances are you will be rewarded with the peace of mind that comes from understanding that God is in control of it all, and He will take care of His family here on earth and throughout all eternity.

Rob West is president and principal of Trust House, Inc., a fee-only financial and investment management firm. He also co-hosts weekly interactive radio programs aired on 90.3FM WAFG. He is also the director of training for Kingdom Advisors. For information or to book a speaking engagement, call 954-351-2088. Please send questions and comments to [email protected].

The information in this article is for information purposes only and does not constitute advice. You should not rely on any information in this article to make (or refrain from making) any decision or take (or refrain from taking) any action.

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