(c)1992 by Reynolds Griffith (INTERNET: F_GRIFFITH@CCSVAX.SFASU.EDU) Permission is granted to reproduce this article electronically only, but not in any printed or hardcopy form. Comments & questions welcome.

Financial Planning for Christians

Tom and Lisa felt that they weren't getting anywhere finan-

cially though Tom made a good salary. They went to see

Don Grunden, a Certified Financial Planner who was a Christian.

His first question to them was, "What are your goals?" "Well, we

want to be better off financially," was Tom's answer. "Of

course, we want to serve God too," Lisa added.

Don asked them that question because a starting point for

all financial planning is establishing goals. You do not

plan just to be planning, but to reach your goals. All

your goals affect your financial planning, even goals that are

not primarily financial. Financial planning is the whole process

of arranging your finances to make it most likely that you will

achieve your goals.

Sometimes Christians react negatively to the idea of

planning, thinking it unspiritual. They may say, "shouldn't we

just depend on God?" or "didn't Jesus say not to take any thought

for tomorrow?" The answer? Yes, we should depend on God in our

planning and in carrying out our plans. We avoid our plans being

merely what we want, but we don't sit back and expect God to do

everything without any active cooperation on our part. Most

translations agree that what Jesus said was do not be anxious, do

not worry. In the illustration of building a tower and counting

the cost (Luke 14:28) Jesus taught the importance of planning.

Other places in scripture, especially Proverbs, make the same

point.

Basic Principles for Christian Financial Planning

There are three basic principles which should govern our

finances as Christians. The first is that it all belongs to Him

(see e.g., Psalms 24:1). Not just what we give in our tithes and

offerings, not just what we recognize as belonging to Him, but

the whole world belongs to Him. Jesus is Lord - the creator and

master of the universe - and this little planet with all its

resources is His too. Some of it is in rebellion against its

owner like the tenants in the parable of the vineyard (Matthew

21:33-41). That does not change the fact of ownership.

Recognizing this principle requires a drastic shift in our

thinking. We are used to saying "my house, my car, my paycheck".

If we "give back" to God a tenth of our income, we think we're

something special. In fact, we can't give any of it to God - it

already belongs to Him. It's not easy to adjust to thinking of

all we have belonging to Him. However, it's an important atti-

tude that should underly all our financial planning.

The second principle is that He loves us and wants to pro-

vide for us, as Paul assures us in Philippians 4:19. It relates

to the first principle because He not only wants to provide for

us, He has the means to do so. As Psalms 50:12 puts it so poeti-

cally, His are the cattle on a thousand hills. Thus Jesus tells

us not to be anxious about food or drink or any such matters

(Matthew 6:25-34). He assures us that our Father knows that we

need such things. He will provide them for us if we keep our

priorities straight and put His kingdom first. If we are willing

to provide for our children, how much more will our Father in

heaven provide good things for us (Matthew 7:11).

Will He really provide material goods for us and not just

spiritual? Yes! The experience of His love in this fashion

helped bring me back to Him some years ago. I was virtually

bankrupt and had no income coming in for the summer. As I

struggled to figure out who Jesus was and whether I should commit

myself to Him, He lovingly provided for me and my family, though

sometimes I didn't know from one week to the next how.

Even after such an experience it's surprisingly easy to slip

back into relying on our own efforts rather than on Him. The

world tells us that if we don't look our for number one, no one

else will, and that we must grab for what we need. Thus, most

Christians (including me too often) conduct ourselves as if our

loving Father were off in a foreign country from whence He'll

someday return to help us. How much better off we'll be if we

rely on Him here and now instead of relying on ourselves and

being anxious.

The third principle is that we're His stewards. We're not

familiar with this concept - about the only time we hear it is

when our church is having a fund raising drive or trying to

enlist our help for some project. If we go back to the first

principle, we realize that the meaning of stewardship can't be

just giving since it all belongs to Him anyway. Rather a steward

is someone who cares for his master's property or business (e.g.,

Joseph in Genesis 39:4). Someone suggested that the term manager

might be more meaningful to present day Christians. It may help,

but the role of many managers doesn't convey the sense of person-

al responsibility and care required of a steward.

Being God's steward means that we seek his will not only in

how we give to our church and other ministries, but in how we use

all the assets and income He entrusts to us. Since most of us

don't expect Him to speak directly to us often, a knowledge and

application of scripture is important in this area of our lives

as it is in other areas. (Of course, we would benefit by listen-

ing more for Him to speak directly to us too).

These three basic principles of Christian finances are not

easy to apply consistently. Worldly influences and the

accumulated habits of years are not thrown off overnight. Even

Paul lamented about the influence of the flesh on his actions

(Romans 7:14-25). Nevertheless if we keep the principles ever

before us, we can bring our finances under the lordship of Jesus

just as we strive to bring the rest of our lives.

The Next Step:Goals and Plans

Goals Are Important. As Don emphasized to Tom and Lisa,

having goals and plans is important. Without them, you are

carried along by whatever current you happen to fall into. Like

Tom and Lisa, many people would say their goal is to be "better

off financially" or, if they are Christians, that their goal is

"serving God". Neither is adequate as a goal. Your goals must

be more clearly stated. Even specific goals like buying a car or

getting a better job need stating in more definite terms and

translated into what it will take over how long. Unfortunately,

many people don't set goals. They drift along only to wake up at

age 40 or 50 wondering what is happening to them and why they

don't have any financial resources.

Kinds of Goals. You may have many kinds of goals. Goals

don't have to be financial - you may want to take a vacation or

improve your physical condition or complete a Bible study

program. But even non-financial goals often have financial

implications and impact your financial planning. Goals can be

long-term, short-term, goals that are ends in themselves, goals

that support other goals. In any case, you need to convert all

your goals into specific objectives and back them up with con-

crete plans in order for you to have much chance of achieving

them.

Setting Goals

Goals are personal. Everyone will not have the same goals,

although many people's lists will overlap. Unfortunately, many

people don't have a list, so instead of goals they have vague

notions. Here's a procedure for setting goals so you can have a

clear vision of them.

List. A good starting point is a technique called

brainstorming. Sit down, open your mind, and think of

possibilities. List everything that occurs to you that you might

want to accomplish or avoid. You may have seen this technique

applied in groups where the rule is that you can't say anything

negative about anyone's suggestion. The same rule applies for

your own use. If a possibility pops into your head, don't say,

"Oh, that won't work" or "Oh, I could never do that." Put it

down on your list.

Evaluate. After you make the list, go back and examine it.

Ask yourself, "Are any of these goals in conflict with what God

wants? Which are important to me? Which of these goals am I

willing to pay the price to achieve?" Goals do have a price

attached - not only in money, but also in time, effort, and other

resources. Answering these questions will narrow your list,

though you may still have many goals that would be worthwhile.

Next, rank the goals in their order of importance. Concentrating

on those of highest priority makes sense when, as would often be

the case, you cannot work on all your goals at once. In setting

priorities don't neglect those things that are of importance to

God. If you are a father, for example, you have a responsibility

to care for your family beyond merely providing for them finan-

cially.

When Don first suggested to Tom and Lisa the need to put

their goals in writing, their initial reaction, like many

people's, was, "Why should we do that - they're just for us

anyway." Don explained that it helps translate the goals from

vague, up-in-the-clouds notions into concrete forms that can be

attained. You can't write down a hazy undeveloped picture of

where you'd like to be or use it in the evaluation process

outlined above. Narrowing goals in a written list helps keep you

from trying to go off in all directions at once and getting

nowhere. Having a list of goals in a place where you can often

see it serves to motivate you. It also sharpens your decision

making - you can get in the habit of asking yourself "Which of my

goals will this choice advance?" In a family setting goals do

need to be communicated to others and family goals developed. If

you are seeking outside help in your financial planning, having

your goals in writing helps the financial planner help you.

Convert to Objectives. You need a solid foundation of

written goals to do a good job of your financial planning and

decision making. Then you need to turn the list of goals into

objectives. Objectives derive from goals, but they differ from

goals in that they are specific, measurable, and have a time tag

attached to them. The goal of getting more education, for exam-

ple, might translate into an objective of getting a masters

degree in industrial arts by May of 1993. There you have speci-

fied, not merely education, but the degree you want to complete.

It is measurable whether you get the degree. The time period is

specified; you want to have achieved this objective by May, 1993.

For some of your goals there will be multiple objectives.

To accomplish these goals, you must translate each into several

specific objectives. For example, your goal of enjoying leisure

might have the objectives of: (1) spending the first week of June

in Florida, (2) going to the lake one weekend a month, (3) learn-

ing to bowl by March 1.

Family Goal Setting. Setting goals in a family situation

requires the co-operation of at least the husband and wife and

preferably older children. Of course, you must convert family

goals into objectives too. Then assign to particular family

members the steps or actions that will be necessary to achieve

the objectives.

Planning Actions

Your goals could be almost anything that you could think of.

They are individual - not something imposed on you from outside

(though pastoral advice and the teaching of the church can help

us in avoiding inappropriate ones and in determining what God

wants of us). After setting goals and objectives, you must carry

through and plan how you can achieve these goals and objectives

so they do not stay out there somewhere as a hope. You start

developing a road map of how to get from where you are to where

you want to be. You do this by analysing each particular goal,

where you are in relation to it, and what steps you need to take

to get there.

Analyze Your Goals. First analyze each goal. What will it

take to achieve it? Ask yourself such questions as:

How much money will you need to accomplish the goal? For

example, it may require $1,200 for you to take your vacation next

June. (Consider the effect of inflation in making the estimate.)

How much time will it require? (Not only calendar time, but

effort time.)

What skills, knowledge, or talents do you need to achieve

the goal?

If you do a good job of converting goals to objectives, this

analysis will be easier, though it will require a great deal of

thought in any case.

Analyze Your Position. Next, you would analyze your present

position. First, think about where you are financially. For

example, you might have $200 already set aside in your vacation

fund toward your trip next June. Preparing a personal financial

statement can give you a useful overview of your present

position. Preparing one annually is a way of measuring your

overall financial progress. A personal financial statement is a

summary of your financial position, including your assets (what

you own), your liabilities (what you owe), and your net worth

(the difference between assets and liabilities). Of course, you

don't look merely at the financial aspects of your position. You

see what talents, skills, and knowledge you have and compare

these with what you need to attain the goal.

Amount Needed. Then ask yourself - how much will you need

to save as time goes by to achieve these goals, starting from

where you are now? If it is ten months until June, you need to

set aside about $100 a month in your vacation fund.

Set Intermediate Objectives. Also make use of intermediate

objectives or steps. That is, consider that long range goals

won't be gained in one jump from here to there. Set intermediate

objectives or steps that you will go through to attain these long

range goals. The intermediate goals may make the long range

goals seem more attainable. Retiring with $200,000 or even accu-

mulating $10,000 for a downpayment on a house may seem unrealis-

tic when you think about getting that far at once. If you break

it down and say, "Well, that means I have to have $1,000 by next

January, $2,200 by the following January", etc., it may not seem

so difficult. Often the intermediate term goal by itself will

seem more attainable, although at times the intermediate objec-

tives may be so hard to reach that you rethink the realism of the

ultimate goal.

Annual Plan. Besides settling on long range goals and

breaking them down into the intermediate steps or stages, you

should have an annual plan. A year is a customary planning

period. It is a short, reasonable period that you can picture.

You would start again with an analysis of where you are. Prepare

a personal financial statement to summarize where you are at the

start of each year. Then ask yourself "To be in line with what I

am trying to accomplish, what do I need to get done over the next

year? Where do I need to be a year from now compared to where I

am right now?" Annual objectives give you something to shoot for

right away - immediate plans that tie into longer term goals.

Review. Having made your plans, of course, does not mean

you are through with planning. In the first place your goals and

your plans are subject to change as time goes by. Planning is

not something you can sit down and do now and expect the results

to still hold five or ten years from now. You should have a

regular process of looking at your goals and plans from time to

time. Make whatever changes that changes in circumstances, your

attitudes, or your understanding of God's will call for.

Your annual planning should include a review of your

circumstances, your goals, and the results of your activities.

Your review could begin with a comparison of your financial

statement now with the statement of a year ago. Such a

comparison lets you measure your progress in financial terms.

How well have you accomplished the annual plans and objectives

which you set out last year? To the extent that you didn't, you

need to understand why. Did external circumstances arise which

prevented their fulfillment? Were the plans unrealistic to begin

with? Sometimes you may undertake too much. Or did you simply

fail to follow through consistently? Understanding the past

year will help you to plan and set goals for the coming year.

What About Time? Sometimes when people see recommendations

such as those set out above, they say "This sounds like it would

take a lot of time. How could I find the time to do all this?"

One way to answer is to ask: if someone offered to pay you two or

three times your usual hourly rate for working an hour or two

each week in your own home, couldn't you find the time to do it?

An hour or two a week spent consistently on your financial

planning will easily be worth that much to you.

The problem of finding time to spend on your finances should

make you see the importance of planning your time as well as your

money. Recognize that you are a steward of time as well as of

material assets. Time is an important resource - sometimes more

important than money. It is easy to lose sight of this fact and

waste it. A useful first step in planning your time is to keep

track for a few weeks of where it is going. Record what you do

during each part of the day and summarize how much time you spent

on various activities. Your record often will spot non-produc-

tive areas which are taking too much of your time. The next step

is to decide how much time you need to spend on certain activi-

ties, then schedule that amount for specific times during the

week. It would not be surprising that if you begin analysing and

planning your time, you can easily find the hour or two to spend

on your financial planning. You will also benefit from time

planning by assuring that you are not shortchanging important

areas like time with your family and prayer and bible study time.

Conclusion

Basing your finances on the principles given here will give

you a foundation of rock instead of sand. Build on that

foundation with carefuly thought-out goals, objectives, and

actions and you are well on your way to avoiding the anxiety

about finances which plagues most people. Make Jesus truly Lord

of your finances and the burden will be light.