Matthew 25:20-21
The man who had received five bags of gold brought the other five. ‘Master,’ he said, ‘you entrusted me with five bags of gold. See, I have gained five more.’ His master replied, ‘Well done, good and faithful servant! You have been faithful with a few things; I will put you in charge of many things. Come and share your master’s happiness!’
I can not tell you the number of times I have heard about the parable of the master who entrusts his servants with coins before going on a journey. Upon his return the servant he has given 5 coins has earned 5 more. The one with 2 coins has earned 2 more. The one with 1 coin had hidden it and only had the initial coin to give back to the master. The master is well pleased with the first two servants and throws out the last one from his household. This is used as an example of using wisely what God has blessed us with.
I have been extremely blessed. I went to an excellent university that despite all the bad press is still well regarded for it's academics, I graduated with just over $15,000 in student loans (cheap in this day and age) thanks to my parents commitment to give their children good educations. God blessed me with an amazing job during our "great depression". I was able to live at home for a year after college allowing me to put 20% into my 401k during the 6 month period I lived at home and worked at Tyco Electronics.
Upon moving out of my childhood home God has blessed me with great apartments and experiences. I have come to fully rely on him for everything that I need. Once I learned to trust him to provide for me, now it was time to learn how to manage it. Unfortunately it has taken me a year to realize this was the lesson I was suppose to be learning.
Even through all of the amazing blessings I have had I absolutely STINK at managing money. I start saving and that would work until my brakes needed to be replaced. Or a windshield. Or pay for CPA prep classes and Exams. Often I would think that I had plenty of money in my checking account and decide to treat myself to one thing or another not realizing that the student loan or the car insurance would be automatically deducted from my account in the next couple of days. Frequently in the last couple of days before the new paycheck would come I would have to transfer money from my savings back into my checkings. And that is if I caught it. If I didn't catch that I was low, PNC automatically pulls money from my savings to my checkings for a nice tidy fee of $10. I can say that PNC has made a lot of money off of me the past year and a half or so.
I just wasn't getting the message. Even the months that I was traveling for work and I didn't have to buy gas or food I would overspend on Souvenirs or Tours in a new place rationalizing that I didn't have to pay to get there or stay there. If I was to do it again it would be more expensive so I better spend the money on it now. God decided it was time to throw the book at me...
Literally
For the past couple of years I have heard my mom talk about Dave Ramsey. Since she has moved to NC she has mentioned him more often. I would have to say that she has a financial crush on him. :) She recently has read his book The Total Money Makeover and has suggested I read it. I didn't really want to. I mean yeah I was getting a ton of fees from PNC and my money moved from account to account faster than laundered money from the mob but I wasn't struggling. I was paying all my bills and investing in my 401k and Employee Stock Plan. Although I was bit high on the balance for my credit card but definitely no where near the credit debt that many students have coming out of college. I had Mint.com to categorize my expenses for me. If I was curious about where my money had gone I could just log in and check. I didn't need money advice.
For my birthday my Mema had given me a giftcard to Barnes and Noble (that place is like my crack and she is just enabling me). I couldn't find any books that I was interested in, which was rare. I normally walk in saying "one book... just one book" and walk out with 3... or 5. So on impulse I buy Dave Ramsey's Total Money Makeover. Honestly I expected some get rich quick ideas and investment advice that was hard to follow. That is not what I read at all. What he said was simple but he said it was going to be hard.
First thing to do - make a budget. Sure - been there done that. But this time I did it differently. I started by planning out what I was going to spend monthly, but also setting up another tab to track what I was going to have to spend my money on for that pay period. This way I could know when I was going to be hit and how much I did have left over after all the "regulars".
Next is to put $1,000 in a savings account (preferably a money market fund) to have ONLY for emergencies. Ok I had some already in a savings account. I switched $1000 to a money market fund.
I couldn't see what was going to be so hard about this total money makeover (I was reading the next step only when I completed the step I was on)
Then comes the hard part. For my age he suggests stop contributing to my 401k (except for the % that my company would match). WHAT?!?! He said to use that money and any extra cash flow to pay off my student debt and credit cards. He despises credit because it is essentially going into debt each month even if you pay it off. I couldn't believe it. That went against everything I had been taught. I was always told to contribute to a 401K cause even 5 exta years of just a little bit would add up in the end. Not to mention that credit cards are so easy to use! But then he quoted Proverbs 22:7
"The rich rule over the poor, and the borrower is servant to the lender."
That stuck a chord. About 3 years ago I tried to pay over my minimum amount to my student loan company but they just took it as a "prepayment" on future bills and did not apply it to the principal. THAT IS THE STUPIDEST THING I HAVE EVER HEARD! I fought with them for maybe 3 months to be able to permanently have that removed so I could pay against the principal. Never worked. Now they hate me and I hate them but I still have to deal with them every month for the next 10 years. Oh and they get around $60 of my money each month in interest. Great I am paying them to basically be jerks.
I am on track to pay off my credit cards in 2 months and my student loans hopefully within a year. Then I can start saving for a down payment on a house as well as a fairly new used car. There is more to his baby steps to a financial makeover but I will let you buy a copy (or borrow my own) to decide if it is something for you.
I am just glad that I am finally taking steps to control my money instead of the other way around.
I can not tell you the number of times I have heard about the parable of the master who entrusts his servants with coins before going on a journey. Upon his return the servant he has given 5 coins has earned 5 more. The one with 2 coins has earned 2 more. The one with 1 coin had hidden it and only had the initial coin to give back to the master. The master is well pleased with the first two servants and throws out the last one from his household. This is used as an example of using wisely what God has blessed us with.
I have been extremely blessed. I went to an excellent university that despite all the bad press is still well regarded for it's academics, I graduated with just over $15,000 in student loans (cheap in this day and age) thanks to my parents commitment to give their children good educations. God blessed me with an amazing job during our "great depression". I was able to live at home for a year after college allowing me to put 20% into my 401k during the 6 month period I lived at home and worked at Tyco Electronics.
Upon moving out of my childhood home God has blessed me with great apartments and experiences. I have come to fully rely on him for everything that I need. Once I learned to trust him to provide for me, now it was time to learn how to manage it. Unfortunately it has taken me a year to realize this was the lesson I was suppose to be learning.
Even through all of the amazing blessings I have had I absolutely STINK at managing money. I start saving and that would work until my brakes needed to be replaced. Or a windshield. Or pay for CPA prep classes and Exams. Often I would think that I had plenty of money in my checking account and decide to treat myself to one thing or another not realizing that the student loan or the car insurance would be automatically deducted from my account in the next couple of days. Frequently in the last couple of days before the new paycheck would come I would have to transfer money from my savings back into my checkings. And that is if I caught it. If I didn't catch that I was low, PNC automatically pulls money from my savings to my checkings for a nice tidy fee of $10. I can say that PNC has made a lot of money off of me the past year and a half or so.
I just wasn't getting the message. Even the months that I was traveling for work and I didn't have to buy gas or food I would overspend on Souvenirs or Tours in a new place rationalizing that I didn't have to pay to get there or stay there. If I was to do it again it would be more expensive so I better spend the money on it now. God decided it was time to throw the book at me...
Literally
For the past couple of years I have heard my mom talk about Dave Ramsey. Since she has moved to NC she has mentioned him more often. I would have to say that she has a financial crush on him. :) She recently has read his book The Total Money Makeover and has suggested I read it. I didn't really want to. I mean yeah I was getting a ton of fees from PNC and my money moved from account to account faster than laundered money from the mob but I wasn't struggling. I was paying all my bills and investing in my 401k and Employee Stock Plan. Although I was bit high on the balance for my credit card but definitely no where near the credit debt that many students have coming out of college. I had Mint.com to categorize my expenses for me. If I was curious about where my money had gone I could just log in and check. I didn't need money advice.
My Mom's financial crush
For my birthday my Mema had given me a giftcard to Barnes and Noble (that place is like my crack and she is just enabling me). I couldn't find any books that I was interested in, which was rare. I normally walk in saying "one book... just one book" and walk out with 3... or 5. So on impulse I buy Dave Ramsey's Total Money Makeover. Honestly I expected some get rich quick ideas and investment advice that was hard to follow. That is not what I read at all. What he said was simple but he said it was going to be hard.
First thing to do - make a budget. Sure - been there done that. But this time I did it differently. I started by planning out what I was going to spend monthly, but also setting up another tab to track what I was going to have to spend my money on for that pay period. This way I could know when I was going to be hit and how much I did have left over after all the "regulars".
Next is to put $1,000 in a savings account (preferably a money market fund) to have ONLY for emergencies. Ok I had some already in a savings account. I switched $1000 to a money market fund.
I couldn't see what was going to be so hard about this total money makeover (I was reading the next step only when I completed the step I was on)
Then comes the hard part. For my age he suggests stop contributing to my 401k (except for the % that my company would match). WHAT?!?! He said to use that money and any extra cash flow to pay off my student debt and credit cards. He despises credit because it is essentially going into debt each month even if you pay it off. I couldn't believe it. That went against everything I had been taught. I was always told to contribute to a 401K cause even 5 exta years of just a little bit would add up in the end. Not to mention that credit cards are so easy to use! But then he quoted Proverbs 22:7
"The rich rule over the poor, and the borrower is servant to the lender."
That stuck a chord. About 3 years ago I tried to pay over my minimum amount to my student loan company but they just took it as a "prepayment" on future bills and did not apply it to the principal. THAT IS THE STUPIDEST THING I HAVE EVER HEARD! I fought with them for maybe 3 months to be able to permanently have that removed so I could pay against the principal. Never worked. Now they hate me and I hate them but I still have to deal with them every month for the next 10 years. Oh and they get around $60 of my money each month in interest. Great I am paying them to basically be jerks.
I am on track to pay off my credit cards in 2 months and my student loans hopefully within a year. Then I can start saving for a down payment on a house as well as a fairly new used car. There is more to his baby steps to a financial makeover but I will let you buy a copy (or borrow my own) to decide if it is something for you.
I am just glad that I am finally taking steps to control my money instead of the other way around.
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