A smart runner entering their first marathon does not simply lace up their shoes and show up at the start line on the day of the race. They prepare for the marathon through daily training runs. Often, they will compete in smaller distance races – maybe a 10K or a half-marathon – to help their body become acclimated to the rigors of running long distances.

The same principle can be applied to eliminating debt. Getting rid of debt is often the no.1 goal when someone wants to manage their money with Christian principals. Dismantling the debt in baby steps is often a necessary task.

Like a runner preparing for a long distance race, debt needs to be attacked in stages. Nothing good is accomplished in paying off so much debt at once that it forces you to go without basic necessities like food and clothing. Cash flow should always be an important part of the debt reduction equation.

Not all debt is equal. When deciding how much debt you need to pay down, there are a few questions that you should always ask yourself.

How big is your debt?

Small debts are easier to eliminate without having a negative effect on your cash flow. In this situation, it makes sense to pay off the remaining balance right away. You’ll save money by avoiding interest and it will not be too difficult to replenish your cash flow. If your debt still requires more than a year to pay off, wiping out your savings to pay it all now can cause problems down the road – especially if an emergency arises.

How high are your interest rates?

The interest rates on your accounts can be a major determining factor in how quickly you pay down a loan balance.

If the interest rate is low enough that paying it off quicker results in negligible savings, it makes more sense to just make smaller loan payments that fit within your monthly budget. You might want to approach high interest accounts before lower ones, especially when it is a 0% interest rate.

If your interest rates average 13% or higher, you might greatly benefit from our Christian debt relief programs.

How much on-hand cash do you have available?

If you do have large cash reserves, paying off a loan rather than continuing to pay interest makes more sense. The rule of thumb for an average household is to have a savings account with enough cash to cover your monthly budget for 3 to 6 months. If you have surplus savings on top of that amount, reducing the debt right away may make the most sense.

Proverbs 27:12 counsels that “The prudent sees danger and hides himself, but the simple go on and suffer for it.” Planning ahead is the smartest thing you can do to balance debt reduction efforts with your cash flow needs. Anticipate major expenses – car repairs, household costs, medical bills – and set aside enough money in your monthly budget to cover these things.

It would be ideal if the life stages involved in raising children and caring for aging parents occurred at separate times. However, many parents of young children find themselves caring for their own parents.

According to the Pew Research Center, 47% of adults in their 40s and 50s are both rearing children and caring for aging families. These members of the “sandwich generation” are simply following the words of 1 Timothy 5:4 which reminds us, “But if a widow has children or grandchildren, these should learn first of all to put their religion into practice by caring for their own family and so repaying parents and grandparents, for this is please to God.”.

Anyone who has been in this situation knows that juggling the priorities of multiple generations and maintaining financial balance can be quite difficult.

Open Communication With The Older Generation

Communication is the key to navigating this could-be stressful situation.

Loss of independence and financial matters are both sensitive topics. In the early stages of caring for a aging parent, ask them which financial matters they feel capable of taking care of themselves and which ones they feel comfortable handing over. Specifically discuss who will pay bills, who will make bank deposit and withdrawals, and who will work with insurance companies.

Lean toward helping them maintain as much independence in their own finances as possible, but keep an eye open for signs they may need more assistance. Even if they don’t tell you something is a struggle, it might show through in time.

Aside from the financial aspects, multiple generations living within the same home raises questions about raising children. Talk with your parents about your approach to child rearing, including schedules, who will provide discipline and which discipline methods you use. Being sure everyone in on the same page in the beginning will save frustrations and misunderstanding later.

Open Communication With The Younger Generation

The age of your children will largely guide your discussion about caring for their grandparents. However, even young children can understand the message of Acts 20:35; “It is more blessed to give than to receive” and this is an excellent opportunity to teach compassion and empathy.

Children can play a helpful role in helping a grandparent adapt to a new living situation.

The good news is, multigenerational households offer an excellent opportunity for children to form strong bonds with grandparents. Encourage children to listen to stories and ask questions about their grandparent’s younger days. The older generation will love reminiscing, and the younger generation will cherish the memories they make.

Organize Financial Information

It is important to organize financial information as early in the process of caring for aging parents as possible. The will prevent scrabbling for the information, or being denied access, when it is needed. Round up and organize…

• Social Security Numbers
• Bank account numbers and safety deposit box information
• Insurance policies
• Past tax returns
• Contact information for doctors, lawyers and other professionals

Consider All The Options

Caring for aging parents can take many forms. The arrangement you select will depend on the older generation’s health, as well as the financial impact.

Caring for aging family members while they continue to live in their own home, known as “aging in place”, allows for the highest level of continued independence. However, this plan requires the financial resources to maintain two households. Though it can be difficult, it may be possible if the older generation owns their home, has no debt and significant retirement savings.

Nursing facilities offer the lowest level of independence and can come at a high cost. However, they provide higher levels of skilled care than a family member can provide. Depending on income, there may be financial assistance available to mitigate the cost.

Merging households offers a compromise between the two extremes, and can be a cost-effective solution. Don’t assume that your parents need to move into your home. If their home is already paid for, while yours has a mortgage, it may be better for your family to move in with them.

Whichever solution you choose today, don’t assume it will always be the right one. As health conditions and finances change, it may be necessary to make another move.

Set Aside Time For Your Children

In addition to the financial commitments, caring for aging parents creates new demands on time and emotions. In order for children to continue to thrive and grow, you’ll need to take special care that they get one-on-one time with Mom and Dad.

Plan ahead for special outings and private quite time with children on a regular basis. When children know that they’ll soon have time alone time with parents, they are better able to handle the day-to-day distractions. Also, check in with children continually to find out how they are feeling about the situation and be sure they know they can come to you at any time to talk, ask questions of just for a hug.

Continue To Plan Ahead

Though caring for an aging parent forces the focus to the here and now, it is still important to plan for the future. Trim the budget, to the bare necessities if necessary, so that you do not dip into emergency accounts or your own retirement savings.

In the best-case scenario, continue to contribute to education savings for your children and to your own retirement accounts.

Ask For Help

When caring for an aging parent, the road can be long and difficult, but you do not have to walk it alone. Engage siblings and other family members in honest conversations and develop a plan for managing both the day-to-day responsibilities and the financial obligations together. Also, contact your county’s Office On Aging to find out what resources are available in your area.

Caring for aging parents, while also raising your own family, can be a difficult journey, emotionally, practically and finically. However, it is a responsibility with it’s own rewards.

It is a fact: more Americans are in debt today than ever before. According to Forbes, consumers saw their credit card debt jump to $856.5 billion as of May 2013, and credit cards are only one source of debt that people carry with them.

While financial troubles can certainly be the result of a difficult economy, let’s face it, we all play a role in our own finances. Short of a sudden job loss or a financial emergency, most financial struggles are a result of our behavior. Let’s take a look at what might be keeping you in debt.

You Are Relying on Credit Cards

“Suppose one of you wants to build a tower. Will he not first sit down and estimate the cost to see if he has enough money to complete it?” – Luke 14:28

As tempting as it can be to put purchases on a credit card, resist doing so. Use them only in case of a true emergency. An example of this might be if your vehicle breaks down unexpectedly and you need to have it towed. Ideally, you could rely on your emergency fund to cover those costs, but if you aren’t there yet this is when you will want to reserve using those cards.

If you often reach for your credit card on impulse, leave your cards at home when you shop. If you see something you want and you do not have the cash budgeted for it, do not buy it. Go home and think it over for a few days. If you still want it then, make a plan for the purchase and save up the money for it.

You Are Over-Complicating Your Life

“A pretentious, showy life is an empty life; a plain and simple life is a full life” -Proverbs 13:7

We live in a world where more is better, and that spills over into the way that we live our life. So many of us try to add so much onto our list of things to do that we cannot enjoy the simple gifts that God has provided to us.

Rather than trying to have your child add take on another extracurricular activity (which often cost money), set aside a day or two each week to go to the park as a family. Take some time and use some creativity to find some ways that you can simplify your life, you will often find that over-complication comes at a cost.

You Are Not Living Within Your Means

“Keep your lives free from the love of money and be content with what you have, because God has said, ‘Never will I leave you; never will I forsake you.'” – Hebrews 13:5

These days, we are all bombarded with images that scream Buy! Buy! Buy! As a result, it is incredibly common to fall into the materialism trap, though. Living in a bigger house or driving a new car will not make you happy in the long term. It is likely to only make you want more stuff.

If you are tempted to ‘keep up with the Jones’ by buying the latest and greatest things other people have, a shift in priorities may be in order. Coveting another’s possessions only leads to grief and debt.

This is certainly not to say that we cannot have nice things, we need only be sure that our priorities are in order. When considering a purchase I will often ask myself if it is going to bring added fulfillment to my life, or allow me to spend enjoyable time with my family. Not all purchases will fall into those categories, but do your best to make sure it isn’t going to pull in the opposite direction.

If nothing changes, nothing changes. Follow the basics of Christian finance and apply God’s word, and you too can enjoy a debt free life.

With today being the first day of the New Year, there is chatter of resolutions abound. On the radio, television, every media outlet available we are hearing about how many people are resolving to lose weight or pay off debt. It is well known though that the majority of resolutions are not kept.

While we absolutely suggest that you resolve to reduce your debts this coming year, we suggest even more that you stick to that resolution.  Here’s how!

Learn to Say No

We are all inundated with colorful catalogs and endless television commercials promising happiness if we buy the latest device. Don’t let the temptation of new and shiny baubles distract you from your goal of reducing your spending. Everlasting happiness doesn’t come from material goods. “Do not store up for yourselves treasures on earth, where moths and vermin destroy, and where thieves break in and steal. But store up for yourselves treasures in heaven, where moths and vermin do not destroy, and where thieves do not break in and steal.” (Matthew 6:19-20)

Enjoy Activities Instead of Objects

Do you think your children will better remember a day spent with the family in the park or the beach or hours spent on a video game? Pack some sandwiches and bring your loved ones to a free public park. Bring some stale bread to feed the ducks. Pack a Frisbee, a football or a kickball. Take pictures if you like, but don’t forget to put down the camera and live in the moment.

Embrace Board Games

Rather than letting them take up space and collect dust in your closet, open up those board games! Dedicate a table in your home to a jigsaw puzzle that is always out. Games and puzzles are inexpensive and they provide a natural opportunity for relaxed conversation. If you want to know what’s on your teenager’s mind, sit with them over a game. You’ll be surprised how much they’ll open up when they aren’t the center of your focus.

Take Advantage of Free Services

Most communities have libraries that not only have free books to offer, but free DVD and audiobook rentals. You can cut back on your movie rental expense by utilizing the library as your own personal media center.

Take Care of your Belongings

Honor the workmanship that went into the manufacturing of your vehicle, furniture, clothes and other belongings. Change your oil regularly in your car to prevent costly breakdowns. Treat stains immediately rather than letting them become permanent, leading to buying new clothing unnecessarily.

Challenge yourself

Where are your weaknesses where spending is concerned? Is it the makeup counter? Challenge yourself to find natural beauty solutions, many are even right in your kitchen. Can’t resist the home improvement store? Find the most cost effective way to tackle that project by reusing items around the house. All of these will not only save a fair amount of money, but also be better for our environment as well.

Get Professional Help

If your burden seems to heavy to bear on your own, seeking Christian debt management help is a good beginning to changing your spending style. Fill out the short form on the right hand side to request a free consultation with one of our Christian Debt Advisors so that you can follow through on your resolution to become debt free in 2014.

We hope you enjoyed phase one of dealing with a Christmas hangover, now it’s time to move on to past two!

If you went a bit beyond what your budget had allowed for (or bypassed the budget altogether) here is a 3 step way to get back on track. Don’t let a holiday slip-up keep you down, you can still reach your Christian debt management goals.

Step One- Assess the Damage

First things first, gain a full understanding of your financial situation. Hop online to review your online statements, or review your statements once they come in the mail. If you took to your credit cards for your gift giving, review all of them and tally up the balances. If you reached into your savings account or even your emergency fund, you’ll want to know how far you went beyond what you can really afford.

Step Two- Make a Commitment

Now that you know just how much needs to be paid off or replenished, you can make a commitment to make it happen. A good commitment is achievable, clearly defined and has a time limit. You may need to pay/save $400 in two months. No matter how far you went off track, don’t make a goal that is unrealistic. Create it, say it and mean it.

Try to keep your goal at two months or less to take advantage of the bonus below.

Step Three- Re-budget

You’ve got your commitment in place, now you need to find a way to make it happen. The end of the year is always a good time to revisit your budget and your financial goals. If you do not already have a written one in place, now is definitely the time to create an honest budget.

If you were really honest in creating your budget, you will probably find that you have a few things that you can give up in order to reach your goal. Specialty coffees, impulse purchases and eating out are a few of the top budget breakers.

Here’s Our Free Christmas Tip For You

Giving feels great. Sacrificing to recoup afterward, not so much. However, you can absolutely turn this Christmas debt hangover into a tremendous opportunity for financial growth.

It is scattered throughout the internet that it takes 21 days to turn something into a habit. The new spending habits you develop in step three don’t need to stop after the Christmas debt is gone. Let’s say you had to pay/save $400 in two months as mentioned above. By this time 2014, you’ll have paid off the 2013 Christmas debt and saved $2,000 on top!

While it would sure be nice if we all skated through Christmas with a carefully executed budget and stuck to our plan to “not do it again this year”, we know that is not necessarily the case. It is very easy to get caught up in the traditional hustle and bustle of Christmas shopping, gift giving and overspending. If that was the case for you, you might be starting to feel the onset of a Christmas hangover.

You may suspect that we are going to be mean and bombard you with a step by step way to get your finances in order, written budget and all. Instead, we suggest that you take it easy…. for now. We’ll save the bombardment for phase two.

For now, just enjoy this video.

When you’re trying to get out of debt any extra little bit of cash helps the cause.

Continue reading

Modern society makes it easy to retain debt, but the Bible is clear on the subject. Romans 13:8 says we should “Let no debt remain outstanding…” Although it sounds simple, we all know that tackling the debts that build up in the form of a mortgage, car payments, student loans and credit cards can be incredibly challenging. Fortunately, the Bible provides guidance on the topic of Christian debt management.

Borrow Wisely

When it is sometimes necessary to borrow money, it should not be done carelessly or on a whim, and we should be sure to use the funds wisely.

In 2 Kings 4:1-6, the Bible tells the story of a widow who was facing the loss of her children to slavery. She needed money, but the only solution available was borrowing jars from her neighbors.

Although the woman borrowed jars from others, the result was enough income to repay her debts to the creditors and protect her children. The Bible tells us to avoid debt whenever it is possible, but recognizes that sometimes it is not possible to avoid debt.

The key lesson is that it is important to apply wisdom to each transaction. Borrow only with the purpose of investing in the future, such as taking a student loan to pay for the education that will provide the opportunity to avoid debt in the future, or an investment in a home that will provide shelter for your family.

Repay the Debts Promptly

“The borrower is slave to the lender” Proverbs 22:7

Whenever it is not possible to avoid debt, it is important to repay the funds promptly. Just because you opted for a 30 year mortgage does not mean you must take 30 years to pay it off. Not only will you have the burden of debt lifted sooner, you can also save quite a bit of money as well.

Keep Trying

“sluggards do not plow in season; so at harvest time they look but find nothing.” Proverbs 20:4

When it comes to Christian debt management, a key tip that the Bible provides is that it is important to keep trying and working hard. Even if you have fallen behind on your debts, it is important that you make every effort to get back on track by working directly with your creditors and lenders.

If this doesn’t work, speak with a one of our advisors for a free consultation to see if you might qualify for any programs to help you regain control of your finances.

If you take a look at the financial state of society at large, you may be tempted to believe that living without any debt is impossible in modern times. However, Christian finance need not mimic that of the secular world. As Christians, we are called to a higher standard in the way we manage our finances, especially when it comes to spending. If we adhere to God’s word in our spending habits, it is very possible to live a debt free life.

A Needed Conviction

Living without any debt requires a great deal of conviction and commitment to Christian finance principles as laid out in the Bible. Romans 13:8 says “Let no debt remain outstanding, except the continuing debt to love one another…” This principle goes contrary to modern financial standards where living on credit is the expected norm. In fact, not having a credit record can actually work against you in today’s financial world as we discuss in another article. As a consumer, you may find it difficult to make major purchases on credit such as a vehicle, house or commercial property without having pre-established credit.

The Real Problem

Owning credit cards and establishing a credit record is not the problem per se. Just because you have a credit card does not mean that you are in debt. It is a lack of control over credit card spending that will lead to debt and financial difficulties. Credit cards increase your buying power, making it easier to acquire the things you need. Unfortunately, credit cards also facilitate buying the things you want, which often goes above and beyond what you need.

The real problem is not the credit card, it is the inappropriate use of them. Carrying balances, paying one account with another, impulse purchases and the like are what truly turn a simple credit card purchase into an overwhelming burden. This is why it is important to identify your wants from your needs.

The pull of materialism is very strong in society today, making it difficult to control one’s desires. Marketers spend billions of dollars to teach society that they need to continue buying the newest and coolest item on the market. If you’re not constantly on guard against this pull, it can be very easy to let your credit card spending get out of control.

Wise spending entails being selective in the items you buy. As a Christian, our financial spending should go deeper than mere material gain, remembering that “we brought nothing into the world, and we can take nothing out of it.” (I Timothy 6:7) By keeping your financial priorities in line with Christian principals, you will be able to enjoy the financial blessings you have while living a debt-free life.

Credit Card Free vs Debt Free

Although it certainly is possible, you may not be able to live a completely credit card free life in modern times. However, you can live a debt free life. If you exercise greater control over your spending habits it is possible to become and stay debt free. Using your credit cards wisely and paying your bills on time will keep you from going into debt. You should also budget your spending to help you live within your financial income.

Many people who have fallen into this vicious cycle are finding relief through the Christian debt relief programs offered by FaithWorks Financial for assistance in overcoming bad spending habits and becoming debt free. If you are in need of bettering your financial situation, help is available.

As Christians, we fully understand the “reason for the season.” It is our time of the year to consider God’s great sacrifice through his son Jesus Christ, our opportunity to reflect upon the sheer magnitude of God’s grace toward us.

Unfortunately, consumerism has taken over our society. It is estimated that the average person sees thousands of advertisements a day. Whether it’s on a billboard, the side of a bus, in a store or on television, we are surrounded by the message that in order to feel good we should spend. This is especially true now that the Christmas season is well underway. We tell ourselves that we must buy things for the people we care about, even if it means putting it on a credit card.

One great thing about attempting to manage finances according to Christian principals is that we understand the importance of the holiday. We know that spending money is not what Christmas is all about. It is important for anyone trying to get out from under debt to celebrate Christmas on a budget.

Fortunately, plenty of people are managing to have a joyous Christmas on a budget and have come up with easy ideas for making it possible to enjoy Christmas without breaking the bank.

Here are a few tips to help you stay on track this Christmas! 

1. Avoid credit cards from Thanksgiving day through January 1.
2. Budget in the cost of groceries for your Christmas meal. If you will have people over, it’s okay to ask them to bring a dish to share. In fact, most people are glad to know they’ll get to enjoy their favorite holiday dish.
3. Divide the cash you have by the number of people you have to buy for and make a list that includes the person’s name and how much you’re going to spend on them.
4. The mailman, hairdresser and next door neighbor will be perfectly satisfied with a thoughtfully chosen card.
5. Don’t buy more edible items than you need. Peanut brittle, little chocolate Santas, egg nog and the other holiday favorites can really add up quick. One great pie with Christmas dinner will easily take the place of those costly little snacks.
6. If you have children, think about what they actually need. If they will be needing a new pair of shoes in the next few months, now would be a great time to make the purchase so that it can be appreciated as a Christmas gift.

Stick to your Christmas budget and come January you’ll be very grateful that your New Year’s resolution does not involve paying off 2013’s Christmas debt!