Mary Hunt is a gifted teacher and writer in the field of Christian money management. I have several of her books. Part of being a disciple is how we handle our possessions without our possessions handling us. God has given each of us resources that are meant to be used for the kingdom.
Recently The Barna Group reported on the effects of the recession since the end of 2008. 45% of Americans have reduced their giving to church, and nearly one-fourth of those have cut their contributions by at least 20%. Does this mean that their incomes went down thus their tithe decreased, or that church was not a priority and wanting to keep up our standard of living we cut God’s part out? A disciple is always thinking God’s kingdom and not me, my, and mine.
Here are Mary Hunt’s nine simple tips (Rules of Thumb) that can help anyone with their finances.
- Measurement: A U.S. dollar bill is exactly six-inches wide. This comes in handy if you need to measure something accurately, and you don’t have a tape measure. Two widths equal a foot exactly. A dollar bill folded in half becomes exactly three-inches wide.
- Insurance: Insure your possessions for catastrophic events, not situations you can cover out of pocket. This rule will keep your insurance costs down because you will be accepting higher deductibles and higher limits. That way, you agree that you will be responsible for covering some of your own losses.
- Mortgage: If you cannot afford a 30-year fixed rate mortgage and a 20-percent down payment, you can’t afford to buy the house. I think we’ve learned the lessons of nothing-down, interest-only, adjustable-rate and other creative mortgages. For now, it seems, creative home lending has all but disappeared. Should it creep back, don’t forget this rule.
- Retirement: Save for retirement first, college second. Secure your own retirement before paying for your kids to go to college. This, sounds harsh perhaps, but it is a rule you should embrace. The best gift you’ll ever give your kids is assurance that you will not become a financial burden to them in your sunset years. They will have more options for how to pay for college than you’ll have for how to survive once you stop working.
- Total debt: Total monthly debt payments should not exceed 36 percent of your gross monthly income. .Add up your mortgage payment, car payments, credit-card payments and student loan payments and divide that total by your monthly income to learn what percentage of your money goes toward your debt.
- Car repair: If the auto repair costs less than half of the trade-in value, repair the car. Otherwise, considering selling it and buying another.
- Holiday gifts: Spend no more than 1.5 percent of your gross income on the holidays, including gifts and travel. And please, make sure that 1.5 percent is cash, not credit.
- Emergency fund: Keep a rainy-day fund equal to three to six months of expenses. This should be cash that you keep available and safe, not your retirement account, which is not available to you now.
- College borrowing: Don’t borrow more money than you’ll make in your first year working after graduation. Pay attention to this one. If you are going to become a school teacher with an entry salary of $45,000 a year, do not borrow more than $45,000 total during your entire three to five years in college. Borrow less, if at all possible.
Let me add one more to make it an even 10…tithe! Look at your giving last year to your church and multiply the total by 10. Was that your income? Are you tithing to the Lord’s work or tipping to kingdom causes? A look at your checkbook reveals what you really love! Keep in mind these discipleship words of Jesus in Matthew 6:21 (CSB):
For where your treasure is, there your heart will be also.
Keep the Son in your Eyes,