The previous two blogs were about defining where you are financially. Knowing your financial status is important because if you are trying to get ahead financially (and aren’t we all?) then you need to know your starting point. And when you know your starting point you can start plotting how to get to your destination.
Thinking about all your financial obligations, deciding where to start and what to do first can be overwhelming. The kids need braces; college is just around the corner; you need an emergency fund; it would be nice to save for retirement, and the list goes on and on and on.
If you are confused about what to tackle first, take a look at the Compass Money Map. There are seven destinations, and each destination has several steps, which should be completed in order. If you are struggling with what to do first, use the Money Map to tackle the first step you have incomplete and focus your time, energy and money there.
Many people are surprised to find that the first step includes giving. After all, if your finances are a mess, how can you possible have enough money to give? Giving is a tactical way to acknowledge that God owns everything and you are his steward. It is a way to put God first. I am not saying that you give to get. What I am saying is that putting God first is a way to get your priorities in order so everything else falls into place behind your number one priority.
Where most people make mistakes in figuring out how to get ahead is that they have wishes, not plans. Let’s say your goal is to save for an emergency fund. Simply stating “I want to have an emergency fund” is vague and undefined. It’s missing key components: How much money? By what date? What will you to to make it happen?
A real goal is specific, it can be measured and it has a timeframe associated with it. Here’s what a view of that goal would look like when you add concrete information:
By December 31, 2016 I will have $1,000 in a savings account which is specifically earmarked for emergencies. I am going to accomplish this by opening a special emergency fund savings account. I will have $20 transferred from my checking account to the emergency savings account each week. I will add another $13 to the emergency savings each week by skipping the fancy coffee on the way to work and brown bagging my lunch once a week.
It is specific: $1,000 by the end of the year by saving $33/week.
It is measurable: you either do or do not save $33/week.
It has a timeframe: both weekly and end of year goals are stated.
The beauty of defining your goal in small daily increments is that by making many small daily choices you can realize a long term goal. Day by day you start to develop new habits, which will become the basis for more significant changes as you progress. These small weekly mini-milestones help you see success and encourage you to continue making positive forward progress.
Any change needs to be driven by a deep desire in your own heart to make a change–and hopefully this desire is driven by a profound desire to please God.
One of the most helpful ways we’ve seen people change their finances is by taking the Compass Catholic Navigating Your Finances God’s Way Bible study. If you want to start a Bible Study group, or if you are interested in more information, contact us.
The most frequent comment from people who have taken the Bible Study is “I wish I had learned this earlier.” People who are young or old all say this–so there is no time like the present to learn what God has to say about managing money his way.
One of the best ways to get your finances in order is to understand that God plays a role in your finances and one day you will be accountable to him for how you handled what he has given you.
So while many goals are nothing more than good thoughts, building a goal that is specific, actionable and time oriented can be achieved especially if it is God centered and wrapped in prayer. Prayer will help you stay focused and serious about the change you want to make in your life.
Goals need to motivate you and inspire you and bring you joy in fulfilling them. Financial goals and inspiration may sound like polar opposites, but financial goals can help you achieve long term life goals. Want to go on mission trips? Having your finances in order will certainly help with that. Want to retire early and work for a non-profit? Having your finances in order will certainly help with that. Once you get your finances in order, so many other doors open to you. Money is simply a tool you can use to build the kind of life you want to live, not something you use just to buy more stuff. Once God is in control of the journey, it changes everything.
We can all flap our jaws and talk non-stop abut what we plan to do, but nothing happens unless we take action by defining exactly what needs to be done. Just like the NIKE commercials…just do it!!
“But the one who peers into the perfect law of freedom and perseveres, and is not a hearer who forgets but a doer who acts, such a one shall be blessed in what he does.” James 1:25 (NABRE)