10 Principles for Stewarding Your Money

If you’ve been to Union Church, you’ve probably realized fairly quickly that we have lots of young people, both singles and couples. One area that young folks generally do not have much knowledge or experience in is finance - budgeting, investing, leveraging, or just thinking rightly about money in general. This is of no surprise, since finance is not a required, or even an offered subject in most schools (which is preposterous).

I was fortunate to have a Grandfather who spoke to me about money, and encouraged me to start saving and investing for retirement early. I also have a professional background in finance. Because of this, I find myself having lots of appointments and general conversations with young folks helping them sort out their finances and think biblically about stewardship, which is a total joy. 

The list below is a conglomeration of principles I have put together over time as a result of these conversations I’ve had. While this list is not exhaustive, these principles have proved to be helpful starting points for singles, and couples, who are trying to figure out how to be faithful stewards of what the Lord has given them. I hope they are helpful for you as well.

1. Listen to & Communicate with each other (if married)  - Prov. 15:28 

Miscommunication, or lack of communication around money in marriage is often an occasion for disagreement, confusion, and conflict in marriage. It is important for couples to not just have money, but to talk together about money. This includes budgeting (see point #2), spending, saving, investing, large purchases, and future plans. If you’re not a “money person,” these conversations might feel like drudgery to you, but they are critically important and will save you from even worse drudgery in the future.

2. Create & Implement a basic budget that you both agree on - Prov. 21:5

When we don’t have a budget for our money, we tend to think we’re doing better at spending than we actually are. A Budget is not meant to function as an unbreakable covenant, but rather as a guide. Budgets provide can help provide awareness and accountability for our spending, as well as an acid test to compare our spending to periodically. If you don’t have a budget, you should probably create one. Attached to this blog is a digital cope of a basic budget template for you to use.

3. Revisit Budget Bi-annually - Prov. 21:5; 16:9

This one is fairly self-explanatory. If you create a budget, but never revisit it or compare your spending to it to assess how things are going, then the budget wont be of much help. Note: If you are new to budgeting, consider revisiting the budget more frequently.

4. Agree on who pays the bills (if married) - Prov. 21:5

Bills are one of the great headaches for adults. Not only doest the list of bills seem to only grow, but they come in different forms (mail, email, internal company portal), and have a variety of frequencies. For example: our phone bill is auto deducted monthly, while our water bill is mailed quarterly, and property taxes are due bi-annually. In addition, our monthly bills are due at different days of the month. To alleviate confusion and frustration, it is generally best to have one person be in charge of paying the bills.

5. Write down when bills are due - Prov. 21:5

Since the frequencies and dates of bills are so diverse, it is almost impossible to keep track of all of them in your mind. Consider writing them all down on one calendar.  (ex. Shared smart phone calendar, home master calendar, etc.).

6. Save up a 3-month cash reserve - Prov. 10:4-5; 21:20

Squeaky car brakes, broken home water heaters, unplanned hospital visits, or worse, an out of the blue furlough or layoff are just a few examples of unforeseen expenses life can bring. Be prepared for unexpected costs and seasons by saving up a cash reserve.

7. 10% Retirement - 10% Non-Retirement - 10% Giving (the 10-10-10 principle) - Prov. 3:9-10; 30:25; 13:11

The 10-10-10 principle is a rule of thumb that helps us to make faithful investing and faithful giving a priority. Here’s the idea:
  • 10% of your income goes towards retirement investing. This money goes into your retirement account (401k, IRA, etc.) and is not touched until retirement. 
  • 10% of your income goes towards non-retirement investing. This money goes into a non-retirement brokerage account. It can be used for large future purchases (such as a home).  
  • 10% of your income goes towards giving. While the scriptures do not require us to give a certain percentage of our income, they do teach us to give cheerfully and sacrificially (2 Cor. 9:6-8). Instead of finding excuses to give less, we should aim for giving more. 
  • Deduct these from your income each month, and live on the rest.
If 10% in each area is not realistic at the moment, consider starting with a smaller percentage, or certain dollar amount and making periodic increases. If you do follow this principle, you will not only be setting your family up for long-term financial security, but also faithfully stewarding the resources you’ve been given as a gift.
When it comes to finances, the reality is that our money generally goes towards what we value. For us to implement a philosophy like this, we must truly value wise investing, faithful stewardship, and generous giving.

Note: For some concrete figures on long-term investment potential results, see attached resources.

8. Invest for your kids / grandkids (if applicable) - Prov. 13:22

When it comes to stewardship, we need to plan not only for our future years, but the also our future generations. The bottom line is this: if you start investing for your kids / future kids right now, contribute a bit of money each month or year, and continue this process until they are fully formed adults, you will be able to bless them with a substantial financial gift.

Here are a few specific pointers on this principle:
  • Consider opening a regular brokerage account through your bank with your child as the beneficiary. You can open a 529 education savings account through organizations like Vanguard, but these accounts will have a 10% penalty on any funds not used for education. 
  • Instead of saving for college, consider keeping the investment for them until they are older, maybe 30-35 years old. There are a couple of reasons for this: 1) By this age, they will have had several years (hopefully!) establishing themselves as fully formed adults with their own jobs, money, and likely their own families and will be able to steward a large financial gift well. 2) This longer time horizon provides a more time for the investment to grow. We’re talking potentially about hundreds of thousands of dollars.
  • Strive to save an average of $200 a month. When it comes to your kids’ birthdays and Christmas, instead of asking grandparents and family members for toys or items your child wants, ask them for an investment gift. 
  • If you do end up saving up a substantial gift for your child(ren), refrain from revealing to them the details of the investment. This way, they don’t grow up thinking they have a financial safety net. 

Note: Again, for concrete figures on what an investment for your kids may look like, see attached resources.

9. Wait 24 hours (minimum) on large purchases - Prov. 19:2

We’ve all been perusing through Costco or browsing on amazon when we suddenly find an item which you’ve never seen prior, but now you can hardly imagine life without it. It may be tempting to click “buy now,” but waiting at least 24 hours will never hurt, and will only help by bringing rationality back into the decision making process.

10. Don’t be motivated by what others are doing - Prov. 14:30

Our society, in many ways, runs on envy. We ourselves, to varying degrees, operate out of envy more often than we’d like to admit - It’s all too easy to get caught up in the “keeping up with the Jones’” game. Don’t do it. If your friends are buying things you cannot afford, moving into homes you would love to own, or going on vacations you’ve longed for - be happy for them, encourage them, celebrate with them. When the poison of envy begins to surface, acknowledge it, own it, confess it, and kill it. Be content with what you have, trust that the Lord knows and provides for your needs (Heb. 13:5), and steward what he has given you wisely and faithfully, for his glory and your joy.

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