Getting into the personal finance world, you can soon feel that there is a lot of pressure to have watertight finances.
There is a lot of information about achieving FIRE, DINKS, Emergency Funds, etc. None of these things are inherently bad.
In fact, I think it is good to pursue them in some capacity.
I’ve been trying to reconcile the need to be responsible with my personal finances without putting my hope in my savings accounts.
Here is how to pursue a balanced view of your finances.
Tempting to feel overwhelmed
First, if you are new to seriously managing your money, feeling overwhelmed is totally understandable. With competing theories and systems, it’s hard to know which is the right one.
While this may not sound helpful, here is where I have landed on managing money: the right system is the one that works for you.
There are a lot of roadblocks that can pop up when you’re new to managing your finances.
You Feel Resigned to Always Being in Debt
Does the idea of getting out of debt just feel too intimidating? Being debt-free may feel impossible.
With so many ideas out there, it might just feel better to stick with what you know. Even if debt can be stressful, wading into a new habit can feel equally scary.
Is it Even Worth Planning for the Future?
Is it worth making changes? Maybe you see social media influencers living their best life, but you feel like you’re scraping by day by day.
Are you Resentful Toward People Whose Finances are in “Good Shape”?
Are there people in your life who received a large financial gift like an inheritance? Or just “come from money”?
In the past, I’ve been jealous of people who appeared to have more money than myself.
we shouldn’t put our hope for the future in a big savings or retirement account
If you feel stressed or ashamed about your finances, I hope it’s helpful to remember that putting your hope in a big savings or investment account is ultimately futile.
However, that doesn’t give us permission to be irresponsible with money.
What happens if you’re finally in a place where you can retire early?
Retirement is idolized in our culture. In a way it makes sense. At some point, you just won’t be able to work.
I think the association with it is rest, relaxation and “doing what you really want to do”.
Again, I personally don’t think any of those are bad things. But I think there is a lot more to it than that.
Both in the present time and in retirement, something I’ve been thinking about is what makes life significant.
That question encompasses a lot more than just finances, but finances have a big part to play in it.
What if a huge life circumstance changes the situation?
What if you put your hope in retiring early, only for some unforeseen life event to derail your plans?
How do we reconcile the need to plan for the future without putting our hope in our finances?
What Does the Bible Say?
The Proverbs are always a good place to go for quick hits of wisdom regarding money.
Proverbs 11:28 – Trust in your money and down you go! But the godly flourish like leaves in spring.
Proverbs 21:5 – Good planning and hard work lead to prosperity, but hasty shortcuts lead to poverty.
In this passage from 1 Timothy, Paul outlines the result of putting our hope in our material riches.
1 Tim 6:6-10 – Yet true godliness with contentment is itself great wealth. After all, we brought nothing with us when we came into the world, and we can’t take anything with us when we leave it. So if we have enough food and clothing, let us be content. But people who long to be rich fall into temptation and are trapped by many foolish and harmful desires that plunge them into ruin and destruction. For the love of money is the root of all kinds of evil. And some people, craving money, have wandered from the true faith and pierced themselves with many sorrows.
What is a Healthy Perspective?
My Own Experience
I was obsessed with how much money I had (still kinda am). While my husband and I strive to be responsible with our money, I learned that having a perfectly funded emergency fund or a certain amount of money in our retirement accounts by a certain age is not the end all be all with finances.
Plus, it is really stressful thinking about money all the time.
The Lord brought up my security in finances in a few different ways over the course of a couple of years.
I’m grateful that we were never in a place where we were desperate for cash, though we have been through seasons where we needed to be much more careful with our spending.
I have come to realize that money does have a lot of power and that there are more important things in life than worrying about it.
That said, we are still careful with money. We budget, are paying off our house early, contributing to retirement, etc. I’m just trying to learn not to obsess over it.
A healthy perspective is nuanced
Before determining money goals, I think it’s important to determine your values. If you’re doing something because you feel you “should” then it is bound to fail or feel miserable.
What are your goals and priorities now and for the future
Some financial seasons will undoubtedly be difficult, but having a “north star” is helpful.
What are your goals both now and in the future? How does work, savings, and investments play into your overall goals?
Where does charitable giving fall into the picture
It’s tempting to save charitable giving until you’re old and have lots of money saved up.
I won’t get into all the reasons here, but suffice it to say there are a lot of benefits to building this practice into your budget and your life as early on as possible.
Not Permission to be Irresponsible
Be stewards of the money we have
1 Timothy 6:17-19 – Teach those who are rich in this world not to be proud and not to trust in their money, which is so unreliable. Their trust should be in God, who richly gives us all we need for our enjoyment. Tell them to use their money to do good. They should be rich in good works and generous to those in need, always being ready to share with others. By doing this they will be storing up their treasure as a good foundation for the future so that they may experience true life.
Our money can be a force for good in this world. I think that is very encouraging and exciting.
Prioritize paying off debt and savings
Getting out of debt should be a high priority when it comes to personal finances. This is a biblical principle talked about in the Proverbs especially.
Proverbs 15:27 – Greed brings grief to the whole family, but those who hate bribes will live.
Proverbs 22:26-27 – Don’t agree to guarantee another person’s debt or put up security for someone else. If you can’t pay it, even your bed will be snatched from under you.
Proverbs 22:7 – Just as the rich rule the poor, so the borrower is servant to the lender.
While debt is a way of life for most Americans, especially when it comes to mortgages, getting out of debt gives us the opportunity to have a greater impact with our money.
Plan for the future - but realize changes can happen
It’s wise to have a plan and be disciplined with finances. But it’s easy to get attached to our plans. I have made many plans with finances – and otherwise – that have not panned out.
It isn’t always a bad thing when plans don’t pan out. Sometimes there are valuable lessons for us to learn in the process!
Learn to be flexible
While I personally place a high value on discipline, I’ve also realized that life rarely goes the way I think it should.
Learning to be flexible with finances has helped me focus elsewhere.
Depending on the financial season you’re in, attention to detail in your finances will vary.
While we should not put our hope in our finances, we are called to be responsible with them!
Here are some resources to help you out!
