Christian Faith-Based Principles For Managing Your Money: A Guide
Are you a Christian seeking guidance on managing your finances in line with your faith?
Staying within budget, saving money wisely, and investing while honoring your faith values can be challenging.
However, as a fiduciary financial advisor, I can outline principles based on scripture to help guide you through your financial journey.
Based on one of my recent interviews with Advice Chaser, I will share some Christian faith-based principles that will help you approach managing your money wisely.
So you can understand more about Christian-based principles for managing your money, let's start by diving straight into how core values weave into money-making decisions.
Core Values and Money Management
Money is essential to everyone's life, but there are more important things than just money.
When it comes to financial planning for anyone from any background or faith tradition, your values should be the foundation for your plan.
The best financial planners will understand what you want to achieve and how that aligns with your core beliefs to ensure that the critical areas of your life work together.
Setting goals and figuring out what matters most when investing is essential.
After that, everything from our daily routine to our investments comes back around those core values and targets.
They are like a roadmap for success!
Being a Good Steward
Money, talents, and treasures - it's all about being a good steward. Stewardship is more than just a buzzword when it comes to faith-based planning.
We all have unique callings and giftings that God has given us to make the most of.
Suppose we do budgeting and financial planning from understanding how to use the money to glorify God. In that case, financial plans can become much more apparent.
Stewardship means you manage what you have in a way that honors the Lord.
Be Smart and Wise
It's all about being wise with your funds! There are a few core ways to spend money in the short term:
Pay for lifestyle expenses
Pay debts and taxes
Save and invest
Give
All of which can help secure a bright financial future if done wisely.
Debt and Bible Principles
Reducing and eliminating debt is a core biblical principle since it involves taking on money that may become impossible to repay later. (Luke 14:28)
Acquiring debt could leave us as "a slave to the lender" - something none of us would ever want! (Proverbs 22:7)
Taking care when managing our finances today can help protect us against unpleasant surprises tomorrow.
3 Essential Questions When Financial Planning
So let's look at three of the most important questions you can ask yourself when aligning your money management with your faith.
1. Who owns it?
When approaching finances with a Christian perspective, the fundamental question is who owns it: you or God?
Starting with this question changes how we approach our money. If God owns it all, we are responsible for managing it how He wants us to. (Psalm 24:1)
It's essential to recognize this difference when dealing with personal finances.
2. How much is enough?
Have you ever asked yourself how much is enough regarding money or income? We often get stuck in the default mindset of acquiring wealth at any necessary cost.
But there's so much more we can do with our resources, like helping others or positively impacting people beyond amassing funds for ourselves.
After all, contentment and generosity are worth striving for too!
Asking, "How much is enough?" is a great way to consider retirement planning.
You don't need an unlimited amount, just the right amount.
Once you have that sorted out and feel comfortable financially, it's up to you if you want to keep working or find other ways to make an impact.
3. Where do you find your joy?
Contentment and joy are essential in life. Our identity, where we find our worth or security, is a fundamental question for all of us.
Are material possessions enough?
Or should we trust something else at the core of who we are?
That's when faith in Jesus steps into the picture! Considering what fulfills your heart is essential in ensuring your beliefs align with your financial story.
So how do financial planning and our faith relate to our family?
Read on to discover more.
Faith, Family, and Financial Planning
Taking the time to ensure your family is secure and provided for, through practical means like an emergency fund is something everyone should strive for.
The proverb of looking at how ants gather in summer to prepare for winter perfectly illustrates this. Proverbs 6:6-11
Gathering some extra resources can help protect against unexpected circumstances in the future.
One of the most important things you can do is look after your family if something happens to your health. To help do this financially, consider protection planning tools like term life insurance or disability income coverage. You can find policies either through an employer-provided benefit plan or directly on the open market.
Taking precautions now will protect against 'what-ifs' and ensure that your loved ones have financial means should something happen to you!
Retirement Planning
Understanding money and retirement planning from a biblical perspective opens up a unique opportunity to look at work in an entirely new way.
Instead of viewing it as just another means to make money or something necessary because of "the fall," we can re-frame our thinking so that work becomes a part of our calling (Ephesians 2:10).
Work was part of God's original design for Adam and Eve (Genesis 2:15). With this understanding, we can create optimistic financial plans, knowing there's no need to rush into full retirement. Work plays an important role too!
Life expectancy is rising, and more people enjoy active lifestyles well into their 80s, 90s, and beyond.
Considering this longer life span when setting up your financial plan is exciting because it gives you the freedom to work - or even volunteer! - in ways that make an impact for as long as possible without worrying about funds running dry at a certain age.
With better planning comes peace of mind knowing you can keep working through any phase of life should you choose while still having enough money saved away.
Investing in Alignment with Your Faith
Investing with faith-based values is becoming increasingly popular, so it's great to know that ETFs and mutual funds are available for those looking to invest their money in line with these beliefs.
These companies have created a set of standards focusing on family or other aspects which aim to align investments according to moral values and improve the world we live in!
Biblically responsible investing can be viable if you want to align with biblical principles!
Kingdom Advisors and Faith Driven Investor are great organizations that I team up with to help people make wise investments that honor God.
Making sure your money invests in promising companies that reflect your values can be challenging. However, if it's important to you, there are ways to do so.
Researching and understanding the components of mutual funds and investments allows for more conscious decision-making with our wallets!
Another way to ensure your investments align with your values is by finding a like-minded financial advisor to guide you in connecting with publicly traded businesses with similar missions and mandates.
Alternatives to the Stock Market
Investing in the stock market has benefits, but other ways exist to make your money work for you.
Starting a business is a significant way of investing and creating potential income streams. And investing in real estate is another way to generate income or build wealth.
So consider digging deeper into different investment opportunities if it aligns with your values, goals, and skill set.
Charitable Giving
Regarding faith-based financial planning, charitable giving often comes to mind. Giving doesn't have to be complex, however.
It can simply mean supporting your church, helping people in your community or neighborhood, or serving in a non-profit charity organization.
There are many ways to express our generosity and ensure that important causes are supported!
Have you ever wanted to create your own charity or foundation? With a donor-advised fund, it can be a more straightforward process than you think!
Connect with an organization like the National Christian Foundation to learn more about donor-advised funds. With a donor-advised fund, one can give cash or art, real estate, and stocks which can provide significant tax savings.
You Can't Take It With You
We've all heard the phrase that you can't take it with you, but did you know there's another way to look at this?
Based on how we live today, you can "store up treasures in heaven" (Matthew 6:19-21).
Whether it's helping those who are less fortunate or participating in activities that benefit others - every good deed counts!
As Jim Elliott said:
"He is no fool who gives what he cannot keep to gain what he cannot lose."
So however big or small your efforts may be, remember that generosity always pays off when it comes down to making an impact!
Let's look at some great resources to help you with faith-based principles for managing your money.
Recommended Reading
If you want to align your money habits with faith values, Ron Blue's "Master Your Money" is an excellent place to start.
Think of it as a helpful roadmap that helps guide financial planning per biblical principles – great reading for anyone seeking a greater understanding of their finances!
Randy Alcorn is an inspiring author who speaks to give believers an eternal perspective.
He wrote a profoundly insightful book called The Treasure Principle that highlights that you can't take your earthly possessions with you, but by investing in eternal treasures - those stored away in heaven - our hearts will follow!
If you want to explore further how Scripture and faith relate to money, possessions, and eternity - Randy Alcorn's 'Money, Possessions and Eternity' is the book for you!
It's packed with in-depth information to help broaden your understanding of why we believe what we do.
If you want to understand how God views money and debt, then Jim Newheiser's book ‘Money, Debt, and Finances’ is another of my recommendations.
It contains answers to questions like: Is it Biblical to have insurance? What does Scripture say about saving for our future?
These resources will help equip all of us to consider these critical topics from a faith-based perspective.
Christian Faith-based Principles For Managing Your Money - In Conclusion
It's important to remember that our success and security lie in God and not in money. Money is simply a tool.
Let us use it as graciously as possible while keeping ourselves accountable to our faith-based principles of managing money.
Your financial decisions today will affect your future, so take some time to plan, set goals, and create an achievable set of action steps.
Review your progress now and then and adjust parts of your spending plan to stay on track with your goals. This way, you can be sure you are staying true to the principles of scripture for managing your finances.
To watch the whole interview, head over to Aquila Wealth Advisors. Remember to check back here at my blog for regular updates on managing your finances effectively and in line with your faith.
Eric Maldonado, CFP®, MBA
Owner, Aquila Wealth Advisors, LLC
San Luis Obispo, CA