Financial Tune-Up: a Personal Take on Saving

By Mitch Stutzman

Any conversation around money will inevitably include some talk about saving for the future. Whether that conversation is couched in terms of emergency savings, college savings, saving for a large purchase like a car or home, or retirement savings, the topic gets a lot of attention when a person considers their overall financial situation.

As I have thought about my own financial journey, and particularly about how saving has impacted my financial life, I have thought about times when my savings has become particularly meaningful. Times when my savings became more than just numbers floating in cyberspace that represent a determined value that our society has placed on them.

I found myself standing at the counter at my local auto repair shop. I had taken my vehicle in to be serviced and for a trained eye to give it a once-over and make sure everything was ready to go for a long trip that I was about to embark on. Things had been running well and I had no particular concerns but just wanted a seal of approval from someone smarter than me.

After my mechanic took a look at everything he told me that a there was some things he would recommend as a safety measure before taking this vehicle on a cross country trip. I trust my mechanic and believed that he had no intentions of selling me something I didn’t need. I said I would go ahead and have him do the work that was necessary. He informed me that with the additional work my bill was going to come to $1,200 for that particular visit. Well, I had not planned for this visit to the shop costing quite that much; but I wrote a check for the repairs. Ouch, that smarts.

After the work had been completed, I picked up my vehicle and was driving home with my wife. We were talking with each other about the unforeseen expense. I remember saying, “Well, writing that check wasn’t fun. But isn’t it great that we can write that check?”

I had read that week in an article from Forbes that 63% of Americans do not have enough savings to cover a $500 emergency. I told my wife that even though I didn’t welcome a $1,200 expense, I was so glad that we set aside emergency savings to cover it.

There was a time in my life when that would not have been the case; a time in my life when if faced with a $1,200 repair bill I may have been tempted to just call it a loss, leave the car at the shop, and walk home and let my mechanic deal with how to dispose of the vehicle. But over the past several years I have developed strategies for saving that work for me and (I can’t even believe what I am about to say) make me excited about saving!

Saving all starts with identifying your cash flow: What is coming in and what is going out. When what is going out exceeds what is coming in, the rest of your financial life doesn’t seem to fall into place like it should. In the words of my mechanic, “There’s your problem, right there.”

Establishing a healthy cash flow plan is the first step in building your savings. I want to take a moment to simply recognize that a person’s expenses exceeding their income can be the result of many different factors. I also want to own and recognize that I have found myself in places of privilege throughout my life which has afforded me opportunities not available to some. But, regardless of status, the principle remains the same that to save you need to make sure expenses do not exceed your income.

Some expenses are unavoidable. Things like food, clothes, and shelter are basic needs that typically require some level of financial commitment.  However, when you step back and take a hard look at your spending, you may be surprised to find that there are some things that could be cut from your everyday spending. I heard it said once that people rarely get themselves into debt or money trouble from one $10,000 purchase, but rather one thousand $10 purchases.

The discipline to make more intentional choices takes practice. It is truly amazing how much money you can save by just waiting one more day to make your decision instead of making your purchase right away.  Instead of buying that cute novelty coffee mug that you saw online, wait one day and see if your life is empty without it. I would venture to guess that many of our “impulse buys” are things that we can probably do without.

So, give yourself a financial tune up and consider what it is that brings you satisfaction. In my experience, peace of mind provides a level of satisfaction that stuff doesn’t. The knowledge that if an unexpected expense reveals itself I can cover it helps me sleep better at night. Take a hard look at your spending and saving habits and make the changes you must to position yourself in way that you can live comfortably and give generously to the causes and organizations you love most.

About the Author

Mitch Stutzman is a Stewardship Consultant for Everence.

This blog is a component of the Ecumenical Stewardship Center’s COMPASS Initiative to engage young adults in conversations about faith and finances. Like what you see and want to know/do more? Visit the COMPASS blog, follow us on Twitter, and join the COMPASS community on Facebook.

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Millennials and Credit – One Personal Perspective

By Timothy Siburg

You have seen the numbers and the data. Marcia Shetler did a nice job of summarizing the reality about millennials and credit. I think it would be fair to say that millennials are apprehensive and anxious when it comes to credit cards. As a millennial myself, I get the sentiment, I do. It can be easy to be afraid, and caught by those fears of money, scarcity, security, and the feeling of not having enough. But as time has gone on, my wife Allison and I have found ways to deal with credit cards effectively for our finances and needs.

Like most millennials, we have debit cards. But perhaps surprisingly unlike many, we have a credit card too. We didn’t take this on without some serious thought, though. My parents’ advice has always been, “A credit card is a tool. Don’t misuse it, and pay it off every month, and you’ll be fine.” I have found that advice to be sound and helpful.

To translate, make sure you don’t carry a balance on a credit card, because if you do, that’s when the interest and the amount you owe can spiral. I think that’s where the fears of many millennials come in. We already have plenty of big interest payments we make each month on student loans, so the last thing we want to do is to create another such financial burden or challenge to overcome.

You might remember that Allison and I often budget over pancake breakfasts. We still do this, though perhaps it’s been a bit more sporadic lately. But when we do this, we include an update on all of our accounts, what it will take to pay off any credit card balance that month, and our plan of action.

I’ll admit, there have been months when those credit card payments are a bit higher than I might like. Just because you have the card doesn’t mean you get to put off budgeting, spending within your means, and saving responsibly. I view a credit card as a tool to make the most of the spending that my wife and I already need to do.

One of the biggest things that we enjoy from our credit card are airline miles. Being half a country away from most of our extended families means we travel a lot. Having air miles to use towards those flights and trips can be a big help in bringing down airline ticket costs. Besides, if we were going to spend that money anyway, we might as well get some additional benefits from those purchases.

In terms of what we purchase with our credit card, we usually use it towards big expenses and online purchases. This might mean a recent car repair bill I had to pay, or as new parents very soon, we have been stocking up on baby essentials, and ordering all of the fun baby furniture online. Using a credit card for online purchases can potentially help give a little extra security.

Friends we know use their credit card faithfully on regular purchases like filling up their gas tank, or buying groceries. They do so because they have developed a system with their family budget, of paying off that credit card weekly while receiving some extra benefits from those purchases. That system hasn’t quite worked for us, but I have seen it work for them.

If credit cards are used wisely as a tool, they can help build up your credit score over time by proving that you are reliable with your finances, and making timely payments. This might prove helpful down the road, when considering a bigger purchase like a new home or car, or when stepping into a new chapter of life like moving to a new state and/or growing as a family.

In terms of faith, one of the things that I enjoy most about having a credit card, is that it gives me a little piece of mind when giving to my church and other causes that matter to me—online. It’s quick and easy to use. These are offerings and donations that we would make anyway, and there’s a little bit of freedom to be able to do these from the comfort of our own home, and see the transaction credited within moments.

These have been things that we have found to be helpful. This advice might not work for you, and I am certainly not a financial expert. For us, having one primary credit card, and debit cards has been the right approach for living faithfully with our finances, and stewarding them. We’ll see how this approach might change once Baby Siburg arrives.

About the Author: Timothy Siburg is the Director for Stewardship of the Nebraska Synod of the Evangelical Lutheran Church in America (ELCA), a Deacon in the ELCA, and is a member of the COMPASS Steering Committee. His wife Allison serves as an ELCA pastor, and together with their cat Buddy, they reside in the greater Omaha area and are expecting their first child. Timothy attended college at Pacific Lutheran University, and graduate school at the Claremont Graduate University and Luther Seminary. Timothy can also be found on TwitterFacebook, and on his blog.

Christianity and Credit

By Joe Tolton

As a Millennial saddled with a massive amount of student loan debt, I find relief just thinking about the Jubilee year described in Deuteronomy 15. What a hopeful concept! All of our debt could be wiped away after just seven years. The Jubilee year among the Israelites had merit. Jubilee years kept the disparity in society from getting too great. This helped people to bond and kept the society from breaking down into those who had money and those who owed the money. Inequalities in the distribution of wealth were not so much that forgiveness of the debt would be too costly for anyone. Lenders were to use a zero-interest system either for the poor (Leviticus 25:35-37, Exodus 22:25) or for all of the people in the country (Leviticus 25:35-37, Deuteronomy 23:19-20, Ezekiel 22:12).

The scripture verses here and in other places acknowledge that a burden of debt can become spiritually and emotionally debilitating, not just a practical aspect of life. The caution of Proverbs 22:7 is that a borrower becomes a slave to the lender.

debt-1376061_640We have moved away from the kind of society that would have considered a Jubilee year to one where the poor are disregarded and preyed upon. Our whole society is taking a more predatory approach to finance on all levels. There is a larger disparity between those who lend and those who borrow than ever before. This is the sort of time in the Bible when the great prophets arise.

The financial industry now depends on debt to survive. The divide between the haves and have nots of this world has become wider and less likely to be bridged . Money has become equated with power, skewing our decision making from practical solutions that offer compassion and grace, to ideas that make sense just for those who earn the most money in the economy today. Those who can afford to lend the money end up making most of the decisions, including the health and welfare decisions of the poorest of the poor and the sickest of the sick in our society. It skews our government, and taints our way of thinking as a society.

Individually debt becomes a guilt-ridden area for many, and, for most, a source of shame. Personal debt can pile up pretty quickly: not just student loans, but car loans, home loans, and payday loans. Credit cards, a form of short-term loan called revolving credit, can be worst of all.

Jesus cautions us to plan for the future and count well the cost of what we are about to do. In Luke 14, Jesus compares looking to the future to planning to build a tower, making sure you budget for all of the levels of the building project. He also talked about the prudence of the king considering the consequences of going to war. Sometimes in the worst financial situations, we may not get our dreams fulfilled.  We may have to negotiate and settle for less. While living without regard to our debts may make us think we are living more freely, the costs of it are more harmful than interest rates and credit scores show.

There is a spiritual reason that Psalm 37 calls us to repay our loans and that Proverbs 22:26-27 and Romans 13:8 caution against getting ourselves in debt. As Christians, we need to do our best to live up to our word, but also offer ourselves the grace that God has given us. As Christians in a society we need to work for better practices when it comes to debt and debt collection.

About the Author 

Joseph Tolton is the Office Manager of the Ecumenical Stewardship Center. He serves as co-pastor of West Elkton Friends Meeting of West Elkton, Ohio and is an ordained minister through the South/Central Indiana District of the Church of the Brethren. He holds a Master of Divinity from Bethany Theological Seminary and a BA in Communication from Hope College of Holland, MI.

This blog is a component of the Ecumenical Stewardship Center’s COMPASS Initiative to engage young adults in conversations about faith and finances. Like what you see and want to know/do more? Visit the COMPASS web page, follow us on Twitter, and join the COMPASS community on Facebook.

Steps for Conquering Student Debt

By Matt DeBallaway-1356948_1280

I remember very clearly when God nudged me to pursue ministry as a career. I also
remember the palatable community atmosphere of a Christian college, and knowing that it was God’s next step for me. Though both of these experiences were nearly a decade ago or more, they are memories I have often revisited to recall God’s faithfulness. What has followed both of these events is in line with Paul’s blessing: “The one who calls you is faithful, and he will do it” (1 Thessalonians 5:24).

Though your experience may be rather different than mine, all who follow Jesus are faced with opportunities that require counting the cost and taking steps of faith. My 18-year-old self could not have fully understood the endeavor of paying for college, but did understand that college (and, later, seminary) was an investment in my future. Thankfully, I was blessed by the support of my parents, my church, and my schools (via scholarships), which significantly reduced the amount of student loans required to complete my degrees.

Having completed my time in college and seminary, repaying student loans has begun. Here’s what this next step of my journey looks like:

1) Before graduation, chosing a repayment plan that would work best for my wife and me. Depending on which plan you choose, you may be able to change plans later. Typical
board-2084777_1280options include several standard repayment models (the same payment amount every month during the course of your loan, smaller payments leading to larger payments, and vise versa) and income-based repayment plans. There are also options for deferring loans if your current financial situation is difficult and prevents you from repaying with a regular plan.

2) Making small (or significant) lifestyle adjustments to pay for student loans. This includes finding a source of additional or increased income and/or cutting back on leisure expenses in order to faithfully make monthly payments.

3) As often as possible, paying more than the minimum monthly requirement. In addition to cost savings, you can target the lowest valued loan with the highest interest rate, and over time decease the rate of accumulating interest as you pay off each loan (what many call the “snowball method”).

4) Celebrating milestones along the way. celebrate-1835387_1280Regardless of how much you owe or how many loans you have, its important to celebrate when you pay off a student loan or decrease the value of your loans a certain amount (e.g. every $5,000 or $10,000).

5) Having hope that loan payments are purposeful and won’t last forever. Even the loans with the shortest lifespans (10 years) can feel like they will never end. Even though repayment can take (a long) time, it’s important to remember the results of your loans: a quality education, the opportunity to be qualified for desired jobs, and/or being faithful to God’s call for your life.

If you find yourself in the midst of paying back student loans, take heart: God has been faithful in the past and will continue to be faithful in the future.

About the Author

m-deball-9-2016Matt DeBall is the COMPASS Communications Coordinator for the Ecumenical Stewardship Center. He also serves as Coordinator of Donor Communications for the Church of the Brethren. He has an MDiv from Northern Seminary of Lombard, Illinois and a BA in Communication Arts from Judson University of Elgin, Illinois. He loves running, reading, and napping. He and Chelsea live in Northern Illinois with their Welsh Corgi, Watson, and attend the First Baptist Church of Aurora.

This blog is a component of the Ecumenical Stewardship Center’s COMPASS initiative to engage young adults in conversations about faith and finances. Like what you’ve read? Visit the COMPASS web page, follow us on Twitter, and join the COMPASS community on Facebook.

Image credits: pixabay.com

Affording College: Before, During, and After


hand-1840039_1920By Beryl Jantzi

There is an old adage that says, “The best time to plant a tree is 20 years ago. The second best time is today.” The same could be said about preparing for the financial realities of paying for college.

Preparation is not a once and done exercise. Preparation is ongoing. One misconception is that preparing for the financial obligations of college is only about saving beforehand or paying off debt once you graduate. In reality, there are several points along the way to redouble your efforts to get as good an education as possible in the most cost-effective way as possible.

There are three stages in Affording College, and each includes proactive steps you can take throughout this journey.

1. Before: for perspective students

  • Know what financing is available. Educate yourself about:
    • Federal loans
    • Private loans
    • Subsidized and unsubsidized loans
  • Shop and Compare:
    • In state vs. out of state costs
    • community college vs. state university vs. private school costs
  • Budget now:lawn-mower-938555_1280
    • Get information on tuition and living expenses for various schools and on campus and off campus costs for various regions of the country
    • Parents: Start 529 plans as early as possible
    • Youth: Consider part-time jobs and summer work to save for college
    • Monitor your debt from year to year
  • Apply, Apply, Apply:
    • Research sources of grants and scholarships, and business scholarships available through parents employers and local civic organizations
  • Do your homework on career interests:
    • Know the first year earning potential of your career of choice to help determine how much you can/should borrow. (Rule of thumb: borrow no more than the entry income of your career of choice)

2. During: for current students

  • Don’t stop looking for scholarships:
    • Scholarships are not just for freshman
    • Return to organizations that may have turned you down for your first year and reapply
  • Don’t take all the loans you qualify for unless you absolutely need to. Borrow as little as necessaryapple-1851464_1280
  • Look for entry level internships for your career and major. Experience will matter
    when it comes to interviewing for work
  • Always know what you owe:
    • Monitor your total debt from year to year
    • Set a limit on what you can borrow based on your career of choice and your first year earning potential

#3 After: for those entering the working world

  • Know the repayment options for all your various loans
    • Prioritize increased payments for highest interest loans and aggressively take on one loan at a time while paying minimum amounts on the others
    • Discuss consolidation of private loans to lower interest payment. Do not consolidate Federal loans which typically have lower interest rates
    • If you are struggling to make payments, do not stop making payments without talking directly with your lender. Forbearance options exist
    • If you can accelerate payments it will reduce total interest paid over the length of the loan

If you find these guidelines helpful, consider viewing three short videos related to these three stages at www.everence.com/college. They are based on the lives of Carol, Erica, and Justin. Each of these students will speak in more detail to the realities of each stage of your college experience.

For more information contact me about additional resources to help you with your college journey at beryl.jantzi@everence.com.

About the Author

Beryl Jantzi and familyBeryl Jantzi serves as the stewardship education director for Everence, a faith-based financial services company of Mennonite Church USA, which serves all who are interested in integrating their faith with their finances.

The Student Debt Challenge

By Marcia ShetlerGraduates with Student LoansIn a month or two, commencement ceremonies will take place at colleges and graduate schools across North America. Can you imagine graduates walking across the stage and receiving another slip of paper besides their diploma? That document would be their student loan bill.

According to US News & World Report, in recent years seventy percent of US students graduated with student loans. So for every ten graduates you see filing past you, seven of them would receive that piece of paper. The Globe and Mail reports similar statistics for Canada, where four students out of ten might have no student debt. What might the numbers on those papers look like? In 2016, the average Canadian graduate had more than $25,000 in debt. In the US, it was more than $37,000.

Student debt creates many challenges:

  • weight-loss-850601_1280The University of Toronto reports that students who took out more student loans were more likely to have poor mental health in early adulthood;
  • Time Magazine says that student debt can delay major life events such as buying a home, getting married, or having children;
  • Time also says that graduates with debt may work more than they wish, including taking a second job;
  • and MarketWatch reports that those who took out loans to pay for higher education but did not complete their degree have the most difficulty repaying their loans.

But student debt doesn’t have to be part of your new normal. There are things you can do to avoid it. And if you’re challenged by student debt, there are ways to make it more manageable.

This month, the COMPASS Initiative will look at these two sides of the student debt challenge:

  • Get great insights every week on this blog and on our Twitter feed and Facebook page.
  • Grab your lunch or a cup of coffee and join us for a Live Chat with Darryl tip-jar-1796480_1280Dahlheimer, Program Director for LSS Financial Counseling—a partner of Everence—on Thursday, April 20, 12:30 p.m. Eastern time, 11:30 a.m. Central time, 10:30 a.m. Mountain time, and 9:30 a.m. Pacific time. Darryl will tell us about new student loan repayment options and share stories of experience and hope about this challenging issue.

Student debt can be a burden that affects our ability to live the life to which God has called us. It impacts how we steward what God has given us to manage and our freedom to be generous. Whether we are considering how to finance education or deal with the financial ramifications afterward, the key is seeking God’s guidance and choosing wisely. I hope the information shared this month will help you conquer your Student Debt Challenge!

About the Author

marcia shetlerMarcia Shetler is Executive Director/CEO of the Ecumenical Stewardship Center. She holds an MA in philanthropy and development from St. Mary’s University of Minnesota, a BS in business administration from Indiana Wesleyan University, and a Bible certificate from Eastern Mennonite University. She formerly served as administrative staff in two middle judicatories of the Church of the Brethren, and as director of communications and public relations for Bethany Theological Seminary in Richmond, Indiana, an administrative faculty position. Marcia’s vocational, spiritual, and family experiences have shaped her vision and passion for faithful stewardship ministry that recognizes and celebrates the diversity of Christ’s church and the common call to all disciples to the sacred practice of stewardship. She enjoys connecting, inspiring, and equipping Christian steward leaders to transform church communities.

This blog is a component of the Ecumenical Stewardship Center’s COMPASS Initiative to engage young adults in conversations about faith and finances. Like what you see and want to know/do more? Visit the COMPASS web page, follow us on Twitter, and join the COMPASS community on Facebook.

Photo credits: pixabay.com

Money, marriage, and faith

By Matt DeBall

When my wife, Chelsea, and I were preparing two-2042416_1280-copyfor marriage, our church asked us to
participate in a pre-marriage counseling course. This included meeting with a more experienced married couple who could mentor us. Many topics were discussed through seven learning sessions and four or more mentor meetings, but conversations that I remember most now were about managing money together. In particular, Chelsea and I learned about how each of us view money, and our mentors shared that the earlier we started to save money for the future, the better.

Because of how values, memories, and emotions surround money, it’s no wonder that managing money in marriage is important to get right—to care for one another and plan your lives together. Thankfully scripture offers at least three helpful insights for handling money together as a couple.

1. “For where your treasure is, there you heart will be also” (Matthew 6:21, NIV).
bicycle-1868162_1280-copy
These words of Jesus are important when considering offerings to the church, but are also relevant for personal finance. Do you or your partner enjoy reading books or magazines? These are likely to be included in your expenses. Do either of you enjoy biking, camping, fishing, or skiing? How about baking, painting, sewing, or woodworking? Money will surely be spent on items to carry out these interests. As a couple plans their financial present and future together, it is important to budget and plan for life-giving hobbies together. Talking regularly about money and special interests allows each person to feel loved and appreciated—both for being able to participate in desired activities and feeling respected by knowing about special purchases.

 2. Whoever loves money never has enough;… This too is meaningless” (Ecclesiastes 5:10). There’s no doubt that money is essential in life, but it isn’t most important. Though conversations and planning may difficult for a couple that has one partner who is primarily a “saver” while the other is primarily a “spender,” at the end of the day, your love for one another will surpass your love for anything else, including money. Keeping your love for one another in focus while talking about money will help you work together and care for each other regardless of how much money is in your bank account.

couple-1838940_1280-copy3. “Be content with what you
have, 
because God has said,
‘Never will I leave you;
never
will I forsake you’”(Hebrews 13:5).
Finding contentment together and trusting God can improve any financial situation. Trusting God with your finances and regularly acknowledging that God provides for your family will help you keep money in the right focus.

Prayer is a good practice that reminds us to trust in God, especially when money is involved. You may consider praying the following prayer together before future money discussions:

Loving and generous God,
Thank you for all that we have. We are grateful that you have met all of our needs and continue to provide for us. Please bless this conversation about money and help us to be good stewards of what you have given us—for our good and your glory.
In the name of Jesus we pray, Amen.

What scriptures help you manage personal finances?

About the Author

m-deball-9-2016Matt DeBall is the COMPASS Communications Coordinator for the Ecumenical Stewardship Center. He also serves as Coordinator of Donor Communications for the Church of the Brethren. He has an MDiv from Northern Seminary of Lombard, Illinois and a BA in Communication Arts from Judson University of Elgin, Illinois. He loves running, reading, and napping. He and Chelsea live in Northern Illinois with their Welsh Corgi, Watson, and attend the First Baptist Church of Aurora.

This blog is a component of the Ecumenical Stewardship Center’s COMPASS initiative to engage young adults in conversations about faith and finances. Like what you’ve read? Visit the COMPASS web page, follow us on Twitter, and join the COMPASS community on Facebook.

Image credits: pixabay.com