A year a half ago, my life changed dramatically. Yes, that’s when I got married, but another influential piece of my life also began to take shape: my finances. A friend of mine kept explaining to me how our teacher retirement funds work and that I should also set up a Roth IRA. I couldn’t understand anything he was talking about. It was like he was speaking a foreign language. Eventually, I started doing some research. What is a Roth IRA? How to save money for retirement. That initial digging led me to search even further: Simple budgeting. Spending plan. Paying off debt. How much should I save? How should I invest?
A couple of unsung heroes in my ongoing education in personal finance were actually podcasts: Optimal Finance Daily and The Scott Alan Turner Show. Much of what I learned I have either already established or am in the process of establishing in my own life:
Build an emergency fund
Always spend less than you earn
Maximize the company match and then fund a Roth IRA
Invest in low-cost index funds
Create a budget/spending plan (even if we don’t track everything)
Mind the gap (increase income & decrease spending)
Don’t buy a brand new car
Automate your savings and retirement
Pay off your debt (debt avalanche!)
Financial freedom and financial independence
Side hustles and passive income
Some of these items are more than just suggestions or “bonus value” that you can add to your life. Some of these are absolutely necessary. Your financial understanding and practices can have a moral significance. Take some of the things that Jesus taught, for example. He cared a lot about morals—about right and wrong.
In his "Parable of the Talents," a master praises and rewards the servants who took the talents that they had been given and bartered them to get even more talents (Matthew 25:14-30). The master condemns and casts into the darkness the servant who buried his one talent and didn’t do anything with it.
The financial moral: If we’re just sitting on our money, blindly spending it all, or ignorantly throwing it into a bunch of different places without any forethought, then we have a serious problem. We need to start making our money work for us: getting out of debt (and staying out), and saving our money.
In another story, "The Prudent Steward," a steward who has squandered everything has been called out by his master, and needs to pay back what he owes (Luke 16:1-9). The master ends up praising the steward for his prudence—his practical wisdom—because the steward decided that it would be better to get at least some of the funds back for the master than to have nothing. The steward took the debts that other people owed him and asked only for half. That way, he was able to at least pay the master as much as he could.
Financial moral #1: even if we’ve been horrible with our finances for months, years, or even decades, we’re not hopeless. Like the prudent steward, we can still set things right. What can I do now to best correct my mistakes, make some sacrifices, and make wise decisions moving forward?
Financial moral #2: the mere practice of saving money and creating a budget and all the rest is not enough. We also need to take care of our finances prudently. This means that we should do some reading and research to figure out the smartest practices and how to adapt them to our own personal situation. For instance, rather than keep my savings account with [insert big bank name] that gave me 0.1% APY, I found a popular, trusted online bank that offered 1.15% APY (and it has continued to climb up to 2%!).
Most of you are a lot smarter than me and have been making wise moves with your finances for some time. Still, take a look at the list above. Maybe there is still something that you could be doing a little more wisely. Do some research. Read some articles. Search the episodes of those two podcasts that I mentioned.
Yes, those parables that Jesus told have far greater importance than our finances are concerned. Jesus is teaching primarily about how we need to be grateful, wise, and generous stewards of the gifts that he’s given us. But if we’re not being wise with our finances, then can we truly be stewards of God’s gifts to us? Am I loving my neighbor if I don’t set aside an emergency fund so that when an emergency hits I can still have something to put in the collection plate? Am I loving my children if I’m letting our debt pile up and the interest payments keep us from a family vacation or from funding their education? Am I loving my wife if I’m constantly spending more than we have, even if it’s for her?
While we can’t just sit back idly with what we have, with the life we’ve been given, and not do anything with it, we also need to make sure that our prudent behavior (financial or otherwise) isn't coming from selfish, greedy motives. Our motivation to save, spend wisely, and generate more money should be out of a generous place—to provide for our spouse and children, to support our aging parents, to do more for those with critical needs, to support the churches, charities, and philanthropic organizations that we care about.
If we don’t act and also act wisely, we could not only be holding ourselves back from greater financial freedom, but we could be holding our families back from more abundant, secure, and fun lives. And we could even be preventing ourselves from loving and providing for our families and our neighbor in ways that are well within our means.
All it takes is some prudence.