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Living Within Your Means
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By John Mathews, D. Min



“I can do all things through Christ who strengthens me”
(Phil. 4:13, NKJV).
 
One morning while sitting at my desk at home, I made a decision. Getting out the scissors, I cut up three credit cards. I had been making a payment on one card, getting an advance from it; making the payment to the second card, getting an advance from it; making a payment to the third card, getting an advance from it; and making a payment to a fourth card. Never was I going to let that happen again, and I have held to my promise. Every month I pay the bill off. Interestingly, some experts believe an additional 30 per cent can be saved by using cash.

The most powerful tool in managing family finances comprises of living within your income.  However, we live in a culture that has a difficult time doing this, and preachers are not immune from this. Even before they enter the parish, seminary students pile up loans. In fact, seminarians are responsible for a total of $1 trillion of the national student debt.[i] Of all types of debt, three areas stand out as the heaviest: mortgages, student loans, and credit cards.
 
If you are not living within your means, what would it take?
 
Conversation Starter:
1.  How can we ensure that our family lives within our means?

2.  Where can we go to find help for better financial planning?
 
I’ll share what it took me to transition from living on credit cards to living within my means. I remember living in a double-wide trailer, changing the oil and installing brake pads on the car, saving for a new set of tires, replacing the heater core and radiator in temperatures below freezing, and, on one occasion, selling pecans for some vacation money. I was staying out of debt and learning to do a lot of things. Then there were our appliances—I paid $100 each for a washer and dryer, repairing them until the washer beat the clothes clean and the dryer would not dry. I did whatever it took to live within my income. If I did not know how to fix something, I bought a book and learned how.

To stay out of credit card debt takes effort and constant attention as it is so easy to create. You may not have a lot of things or travel extensively, but you avoid the burden of feeling hopeless under the debt. I guarantee that you will have more peace of mind without credit card debt.            

              If you think you will be rich on a pastors’ pay, think again. You did not take the calling to get rich but to live a life of service. You may or may not be appreciated like you want to be; you may not make as much as you would like. Only in God’s eyes do we find value and a life worth living.



Below is a grid showing how many years it will take to erase credit card debt. Do not be discouraged that it may take a while to get out of debt, just as it took a while to get into debt. But psychological research has proven that belief stands as the most important factor in your success. You must believe getting out of debt will be possible, and this grid will help you realize that possibility. Let me remind you of my starting text: “I can do all things through Christ who strengthens me.” This remains true even when it comes to living within your income and avoiding debt.
 

Debt Reduction Chart

Total Debt

Year 1

Year 2

Year 3

Year 4

Year 5

Year 6

Year 7

Year 8

Year 9

Year 10

$2,000

167

83

56

42

33

28

24

21

19

17

$4,000

333

167

111

83

67

56

48

42

37

33

$6,000

500

250

167

125

100

83

71

63

56

50

$8,000

667

333

222

167

133

111

95

83

74

67

$10,000

833

417

278

208

167

139

119

104

93

83

$15,000

1,250

625

417

313

250

208

179

156

139

125

$20,000

1,667

833

556

417

333

278

238

208

185

167

$30,000

2,500

1,250

833

625

500

417

357

313

278

250

$40,000

3,333

1,667

1,111

833

667

556

476

417

370

333

$50,000

4,167

2,083

1,389

1,042

833

694

595

521

463

417

$75,000

6,250

3,125

2,083

1,563

1,250

1,042

893

781

694

625

$100,000

8,333

4,167

2,778

2,083

1,667

1,389

1,190

1,042

926

833

$150,000

12,500

6,250

4,167

3,125

2,500

2,083

1,786

1,563

1,389

1,250

$200,000

16,667

8,333

5,556

4,167

3,333

2,778

2,381

2,083

1,852

1,667

$250,000

20,833

10,417

6,944

5,208

4,167

3,472

2,976

2,604

2,315

2,083

$300,000

25,000

12,500

8,333

6,250

5,000

4,167

3,571

3,125

2,778

2,500

$350,000

29,167

14,583

9,722

7,292

5,833

4,861

4,167

3,646

3,241

2,917

$400,000

33,333

16,667

11,111

8,333

6,667

5,556

4,762

4,167

3,704

3,333

$450,000

37,500

18,750

12,500

9,375

7,500

6,250

5,357

4,688

4,167

3,750

$500,000

41,667

20,833

13,889

10,417

8,333

6,944

5,952

5,208

4,630

4,167

Calculations are monthly payments and do not include fees or interest.


Add up your total credit card debt. Look in the left hand column for the figure nearest to your amount of debt. Go to the right across the page to the year you want to be out of debt. The figure shows how much you will need to pay monthly to be out of debt by that year, and this assumes not incurring any more debt.  Surprisingly, most people could be out of debt in ten years. The debt will end sooner if you add ten percent (rule of thumb) of your income to this monthly figure. Look at this chart monthly and stick with the plan.
As you start and continue the journey of living within your income, you will see God’s blessing.  You will even be able to move to another level of financial stewardship: investing in your future.
 
Conversation Starter:
What are we doing to prepare for our retirement?


Share your story to encourage others who may feel their situation hopeless to take action. Let’s help others believe.
 
[i] David Briggs at www.huffingtonpost.com/david-briggs/seminary-debt-rising-clergy-postpone-starting-families-face-bankruptcy_b_1821349.html, retrieved August 21, 2013.



 
 John Mathews, D. Min, serves as the Stewardship Director of the North American Division of the Seventh-day Adventist Church, Silver Spring, Maryland.