Planning for Your Financial Future

October 30, 2004

I.  The Definition of Financial Planning

* Financial planning it allocating limited financial resources among various unlimited alternatives – Ron Blue, Master Your Money, p. 26

ILL:  To understand what we’re talking about – give your child (or yourself) $50 and take them to the mall – into stores they like, and see how long the $50 lasts and the struggle they go through in making the decision on how to spend the money!

- you’ll never have enough money to do or buy everything you want – and the curse of sin on our ability to think and reason makes it easy for us to want a lot of things!

- Unless we plan on HOW to spend money and the PURPOSES we’re trying to accomplish, it becomes a spiritual war of lust vs. truth / wisdom vs. whims / etc.

II.  Specific Reasons to Plan

A.  Our Creator is a planner – we’re made in His image

Gen. 1:1 – was part of God’s plan – it’s what would bring Him glory for His creative power!

- He planned each day and said, ‘Let there be ____________, and there was ___________”

- When He was finished, what did He say about His work:  “very good”

- Then came Gen. 3 – curse of sin

- But God had a plan:  Gen. 315

  • Genesis 3:15 And I will put enmity between you and the woman, and between your seed and her seed; He shall bruise you on the head, and you shall bruise him on the heel."

* The plan of redemption – it started in Gen. 3:15 and ends in revelation with Jesus has KING and LORD of ALL!

Point: That’s a plan – God is the ultimate Planner– and we’re made in His image and likeness – so we should plan as well!

B.  God’s Word gives us practical reasons to plan (not that the 1streason is NOT practical)

  • Proverbs 6:8 Prepares her food in the summer and gathers her provision in the harvest.

- the context here is not simply laziness vs. diligence – but preparation vs. ‘flying by the seat of your pants’

- actually thinking ahead and making good decisions – well thought out decision – decisions where much communication has taken place . . . THEN writing the check for ___________!

1.  Planning provides direction and purpose.

- making the decisions ahead of time (without any undue pressure) allows a person to set the direction they want to go

- here’s an important concept:  If you don’t know where you are going, how will you know when you get there?

> answer is: you won’t – you have to decide/determine your direction you want to go

> too many times, we’re like the town idiot who goes around shooting arrows and then draws the bull’s-eye around the arrow, then brags on who good of a shot he is!

- planning forces you to consider what you want to accomplish or the purposes you believe God wants you to accomplish

>  the ant instinctive prepares for the winter:  she plans to survive by having enough food to make it through

*  You only have a few short-term options for the distribution of income:

1)  Give it away

2)  Support a lifestyle

3)  Repay debt

4)  Meet tax obligations

5) Save it (cash flow margin)

Q: How do I determine how to allocate the money among these 5 alternatives?

#1: Commitments

#2:  Priorities

Example:  Laurie and I have certain lifestyle commitments – dept repayment, taxes, giving are all commitments – certain lifestyle expenses (utilities, food, insurance, clothing) are also commitments

Point:  A commitment must always be top priority! (integrity and testimony are at stake when we make a commitment – the glory of God can rest on what we do/not do!)

- Now, after all that’s done, the distribution of what’s left over (balance of my resources) is determined by my priorities!

> what we think is most important based on biblical principles and God’s wisdom given to us because we asked!

> our priorities should be determined by what we think will bring the most glory to God and how we can give the best account at the Judgment Seat of Christ:

  • 1 Corinthians 10:31 Whether, then, you eat or drink or whatever you do, do all to the glory of God.
  • 2 Corinthians 5:10 For we must all appear before the judgment seat of Christ, so that each one may be recompensed for his deeds in the body, according to what he has done, whether good or bad.

- Most people say that giving and savings are their priorities – but in reality, they wind up at the bottom of the priority ladder

“I have observed that most American Christians have lifestyle as their top priority and second, because of their lifestyle, debt retirement.  Taxes would be a third priority because they have no choice; fourth would accumulation; and finally giving.”Master Your Money, p. 28

- notice that of the 5 short-term alternatives, three are consumptive --  two are productive

Note:  By ‘consumptive’ I mean when the money is spent – it’s GONE FOREVER!

- that’s why we you make a decision to spend a dollar, that dollar can never be regained – its’ gone

>  that’s why planning or decision making in advance is so important – you make those choices without the pressures of ‘the delight of the eyes’ as in Gen. 3 – Eve’s temptation!)

Input:  How would you place the 5 short-term uses into the following categories”

 

Consumptive

Productive

2)  Support a lifestyle

3)  Repay debt

4)  Meet tax obligations

 

1)  Give it away

5) Save it (cash flow margin)

 

- Savings and giving are productive in nature

“Money that is put into savings is much like planting a crop—later on, much more that what was planted comes up and can be used again for either consumption or production” – p. 28

- that’s part of the whole point of the 3rdfactor of stewardship: You can increase it or diminish it, but God wants you to increase His resources!

2.  Planning helps clarify God’s will for our lives.

- AFTER we’ve careful looked our income and possible distribution avenues, and . . .

- AFTER we’ve searched the scriptures and made sure that biblical truth has been brought to the table, and . . .

- AFTER we’veprayed and asked God for wisdom, and . . . .

- AFTER we’ve thoroughly discussed the plan with our spouse (or sought wisdom from another person, if your single) then we can say, “If God is willing, this is the plan . . . “

- we have to keep in mind, that God is ultimately in control of the events of our lives:

  • Proverbs 16:9 The mind of man plans his way, but the LORD directs his steps.

3.  Planning provides motivation for our efforts.

– i.e. you get excited and motivated to accomplish what is very doable in your mind!

ILL: Howard Johnson, the founder of Howard Johnson Motels – always kept his top 10 priorities goals in front of him – those goals helped him to make the decisions he had to make!

- if the spending opportunity doesn’t fit into the goals that have been established, then the answer is no, or you have to consciously change/alter the goal

- but if you’re always changing the goal(s), then you really are not committed to the goal itself!

- the motivation is two-fold:

a.  God is pleased and glorified by the use of His resources!

- that’s the point of hoping to hear ‘well done, thou good and faithful servant’ – without Him we could not have done it anyway!

b.  The goal will be experienced (reached)

ILL: Nehemiah – prayed, planned, worked hard, and God blessed – 52 days and the wall was finished

- remember:

  • Proverbs 16:3 Commit your works to the LORD and your plans will be established.

4.  Planning promotes spiritual growth in our relationship with God.

- our confidence in God grows, our faith and trust increase

- our need to ask for wisdom and our dependence upon His grace grows stronger!

- but also our delight in seeing how God uses us to accomplish His plan for our lives

Examples of those in the Bible who grew as God helped them achieve specific goals?

Abraham – the Promised land; Noah – the ark; Nehemiah

- Close by reading Key Passage:  Luke 14:28-30