Debt is a thief that steals your future and makes
you a slave to the lender, when you do not have more than enough cash at all
times to pay off all debts you incurred. High finance fees & interest
charges exacerbate the problem for many people because during many years of
making minimum payments they pay a premium of 15 to 30% of the principle
borrowed and outstanding. Debt is insidious. It and your use of more of it
grows (while you act like you don’t know it’s doing so) and begins to
strangle your life and finances to make you very uncomfortable. Most people continue
to take on debt (even over 30 and 40 year well-paid careers) and in
their senior years do not have enough assets they can turn into stable income
needed to cover the level of expenses they must pay for the lifestyle of
debt-taking and material purchases they drifted to over the years.
Think of all the types that currently strangle
most people and make their financial lives unhealthy and unprofitable: credit
cards, payday loans, student loans, pawn loans, car loans, unreasonable
mortgage loans and business loans, balloon notes, etc. Everyone thinks they’ll
be fine and are being helped by taking out such loans (even those with
multi-million-dollar annual business revenue) until economic downturns
occur (e.g., regional, national, worldwide, downward revenue spirals,
layoffs, unemployment, etc.). When they do not have sufficient surplus cash
and/or liquid assets not needed for ongoing household or business operations
that can cover three to six months or more of expense payments during each
downturn (that inevitably comes their way), then they suffer, get
properties foreclosed on, have equipment repossessed, need bankruptcy to try
and survive, and/or have businesses liquidated.
Wouldn’t it be better throughout the years to
focus on eliminating your debts while refusing to take on other debt, thus
drastically lowering your monthly expenses. This allows you to have great
profit margins from which you can set aside reasonable emergency funds and
liquid assets to cover the inevitability of economic downturns that history
shows we experience every eight years or so. You would have more than enough to
survive and thrive in business and personal life during such times. The
elimination of all debts allows you to positively control your expenses and
reduces your liability and gives you needed profitability to drastically
increase your cash flow and assets. Whether business or personal, if your outgo
exceeds your income and you have not saved enough to cover expenses during
three to six months of much lower income, your upkeep will eventually be your
downfall!
You must keep the amount of expenses below your
income in order to have peace in your life because this helps you take care of
all your needs and responsibilities in life including you, your spouse, and
children. The pattern above will also help you serve employees during such
times by retaining them or at least helping provide basic needs they might
have. You don’t have to log all your expenses over the past few months nor log
every single expense on a ledger for the next few months in order to decide
what route to take to correct your situation or begin the process. The pain of
your present suffering should make you willing to follow biblical money
management principles that help you establish a godly mission for your life,
set proper goals, know your income, identify unnecessary expenses, and
establish a budget for your family and business.
Many people don't like to hear the word
"budget." However, when you don't develop a giving-saving-spending
plan based on the reality of your present income then your reality throughout
life will be that your expenses inevitably outgrow your income and leave you in
financial turmoil with many headaches, torment, and bill collectors hounding
you and credit card companies raising your interest rate to take even more from
you while your suffering financially.
By counting the cost first - identifying your
income and spending priorities on paper or computer via a budget – you turn
your dream of financial freedom into a reality because it helps you spend less
than you receive each pay period. It helps identify your needs versus your
wants, so you can focus on purchasing materials and services that have the
highest priority and use increased discretionary cash flow to get out of debt
in the most expedient manner using the debt snowball or avalanche methods.
Knowing the state of your finances at all times
is essential for financial health, wealth, peace, and joy. It is part of
pressing upward for the mark of the prize of the high calling of God in Christ
Jesus. Good stewardship is the method we use to press for His best, including
being obedient to biblical financial principles. In this way, you will maintain
maximum ability for fruitfulness, profitability, and long-term prosperity He
desires you to get in this earthly portion of your life.
Please
pray for this ministry, email me with any questions, and contact me to speak at
your business or ministry conference or workshop. May the LORD bless you richly
as you follow His plan!
Proverbs
27:23-27, Habakkuk 2:2-5, Luke 14:28-30, Philippians 3:14-15
Please
forward these bondage-breaking articles to other people who can use helpful
insight!
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