Don’t wait to tackle financial issues
    January 2 2009 by Dianna L. Cagle, BR Assistant Managing Editor

    Afraid to check your mailbox because of bills?

    With debts piling up for many Americans, some see living on a budget as a pipe dream.
     
    But Pedro Rosario, eastern area director for Crown Financial Ministries, advises Christians to take baby steps.

    “A budget doesn’t restrict you,” he said. “It guides you as a family unit on what you spend your money on.”

    How do you get started?

    • Create a 30-day diary.

    “If you want to spend $50 a month on Starbucks, that’s up to you,” he said. Just recognize you may have to make adjustments in other areas.

    People don’t generally understand how much they are overspending until they see a monthly account of their income and expenditures.

    After a person or family finishes a 30-day diary, Rosario recommends they figure out how much things cost them annually.

    “Is it really worth it?” Rosario ponders. “A cup of $4 coffee doesn’t seem like much, but once they see it as $200 a month, they’ll see it can make a difference in their spending plan.”

    • Create an estimated spending plan.

    One key to corralling spending is to understand how much money is actually going out.

    Rosario likens the plan to drawing a border around your finances “so you can contain them within your walls.”

    When you have a handle on where your money is going, you must decide how much to spend on entertainment, car maintenance, groceries, etc. You can continue to do things you like as special treats, but likely on a smaller scale, at least for awhile.

    Part of a complete spending plan would include birthday and Christmas presents and charitable giving.

    • Create a debt list.

    “Write down every individual you owe, how much you owe,” Rosario said.

    You should know how much interest you are paying and be willing to make short-term sacrifices to reach long-term financial goals.

    Crown uses the term “snowball” for its recommended process to tackle debt. “Pay off the smallest amount first,” Rosario said. “Once you get traction, take the money you pay on one and add it to payment for (another).”

    Often people make the mistake of running away from their creditors instead of toward them, he said.

    “Sometimes it takes a few phone calls to find the right person but they will work with you,” said Rosario, “possibly lowering rates for a few months” to get a better handle on your finances.

    • Start saving immediately.

    Crown recommends that each person have $1,000 in savings to deal with unexpected emergencies. Rosario knows that’s a large amount to most folks but said you can start small and get there with a few dollars a week or month to get into the habit, then increase.

    • Tackle problem areas.

    It is overwhelming to confront all your problem areas at once.

    “Break it down, attack certain areas; get it under control,” Rosario said. “Work on eating out, or the grocery portion … something that is easier to control.”

    Some tips to save money when grocery shopping: eat beforehand; create a meal plan and shop with a list; shop sales; and leave children at home.

    Once you develop these tools you’ll be able to plan your attack and identify changes you need to make, Rosario said.

    For those in deep debt, Rosario advises them to seek resources — within the community and through the local church — to help them “just to get over the hurdles.”

    Rosario advises people not to wait until their financial situation gets worse. Facing the problem early saves a lot of stress later.

    The number of calls Rosario has been receiving for financial help has doubled recently.

    “We have to understand that God owns it all,” Rosario said. “Our part is to be faithful stewards … because we will be accountable some day. That’s tough for a lot of people. It’s easy to say that God owns it all but it’s a lot tougher to live that.”

    Rosario said the three biggest hazards in personal finance are credit cards, cars and houses.

    “If you’re able to take care of those three areas from a financial standpoint you’ll be headed in the right direction,” he said.

    Money Map coach
    Crown Financial Ministries offers a free Money Map coach to help you with budgeting matters. Visit www.crown.org or call (800) 722-1976 (Select option 3, then option 4, and then option 1. Follow the instructions. Someone will call back and give you the name and contact information for the coach nearest to you so that you can call the coach and set up your first appointment.).

    Financial health package
    Across three issues of the Biblical Recorder and numerous postings online, the BR staff compiled stories dealing with financial health, budgeting, teaching children about money, stewardship issues, etc. For a complete list, click here.

    1/2/2009 5:13:00 AM by Dianna L. Cagle, BR Assistant Managing Editor | with 1 comments
    Filed under: Crown Ministries, finances, stewardship




Comments
Dedra Cagle
This link has an excellent tool to use while trying to pay off your debt. It uses the debt snowball method. The goal is to pay minimum on all bills but the one with the lowest payment. On the lowest payment, one must apply any extra money on top of the minimum balance until it is payed off. Once that bill is paid off, then this amount is applied to the minimum amount of the next one. This continues creating the snowball effect to paying your bills off.

Happy Snowballing!
1/2/2009 5:27:15 PM

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