by Ryan Kurtz
5 Ways to Build a Strong Financial Foundation
If we think back over any time in history, we can think of different economic storms that have come. From The Great Depression to the World War’s to the more recent memories of the economic difficulties of 2008, many of us now wonder, when will the next “storm” hit?
We hear people talking about Social Security not having enough to continue and the federal government approaching $20,000,000,000,000 of debt. We wonder, what can I do to protect myself? We can’t predict when or if future economic storms will come, but here are 5 things a business, government agency, or family can do to have a strong financial foundation no matter what the future holds.
- Have a plan for your spending – Make sure you know where your money is going each month/year with a spending plan. With this in place, you can see if you are spending less than you earn. Having margin at the end of the month is the foundation to any good financial plan.
- Keep emergency savings – Most financial advisors recommend having 3-6 months of living expenses for a family or operating expenses for a business set aside for unexpected expenses. This can help tame down the feelings of panic that come on us when a car for a family or piece of machinery for a business breaks down and we have additional unexpected expenses.
- Avoid and eliminate debt – During times of economic downturns having no debt at all is the best place to be financially. If you can, try to avoid borrowing when possible and if you have debt, make sure you have a plan to eliminate it.
- Set long term goals – If you do not have clearly defined long term goals it is very easy to get sidetracked when difficult times come your way. Author and motivational speaker Zig Ziggler has said, “If you aim at nothing, you will hit it every time”.
- Be continuously generous – There are many ways to be generous. It could be with our time or with our resources. Being committed to being generous no matter what the economic environment is around us may not seem to help our financial bottom line, but often can give fuel to our soul during difficult times.
These are all practical things that can be done to help you sleep well at night knowing that your financial house is on a solid foundation. What I didn’t tell you is that each one of these is a financial principle straight out of the Bible, God’s Word. We believe that standing on the Word of God during good and bad financial times is the best way to build strong financial house that can weather the storms that come our way. We can rest knowing that we have done everything that we can practically and leave the rest in God’s hands. After all, everything we have is His.
Psalms 24:1 – The earth is the Lord’s, and everything in it, the world, and all who live in it;
Here is the list again with the corresponding verses.
- Have a plan for your spending.
Proverbs 27:23 - Know well the condition of your flocks, and give attention to your herds
- Keep some emergency savings.
Proverbs 21:20 – Precious treasure and oil are in a wise man’s dwelling, but a foolish man devours it.
- Avoid and eliminate debt.
Proverbs 22:7 The rich rules over the poor, and the borrower is the slave of the lender.
- Set long term goals.
Luke 14:28 For which of you, desiring to build a tower, does not first sit down and count the cost, whether he has enough to complete it?
- Be Continuously Generous.
2 Corinthians 9:7 Each one must give as he has decided in his heart, not reluctantly or under compulsion, for God loves a cheerful giver.