Save to Help Meet Your Goals
- Monday, April 15, 2002
Shouldn't I rely on God alone to meet my needs and provide for the future? This question is very common among those whose chief desire is to live in complete faith, trust, and dependence on God. To answer it, we must distinguish faith from presumption. On one hand, the Bible is clear that walking worthy means putting complete faith and trust in Him alone. On the other hand, the Bible stresses our personal responsibility to exercise wisdom, make good choices and decisions, and demonstrate personal discipline.
Failure to save anything at all from our income is both presumption on God and foolishness rather than faith. ...
For What Should I Save, and How Much is Enough?
The answer to this question can be divided into two parts: short-term savings and long-term savings. Let's begin with three common short-term goals.
1. Emergency Funds. What happens when you have a traffic accident and need $500 to cover the deductible on your car insurance? What do you do when your son breaks his arm and $300 of the bill is not covered by insurance? What about when you get a call from across the country that summons you to a close relative's funeral? You have just two choices: either save beforehand or use debt and credit when emergencies strike.
A realistic minimum to accumulate for emergencies is $500 to $1,000. If you saved only $10 a week it would not greatly affect your current lifestyle, but it would dramatically alter your response to an emergency.
Credit cards are not a suitable alternative for handling emergencies. First, borrowed principal must be repaid, and this reduces your future spendable income. Second, you have to pay interest, leaving you even less spendable or saveable income.
2. Repairs and Maintenance. Everything on this earth will eventually need repair, maintenance, or replacement. A realistic minimum to save would be at least enough to cover probable expenditures for health, homes, and transportation. If you have medical insurance, try to save at least twice the deductible. If you have a car, save at least your deductible on collision insurance plus probable cost of repairs over the car's mechanical life. A conservative guideline for home repairs and maintenance would be to accumulate 1 to 2 percent of your home's fair market value.
Annual Events. Every year the same annual events occur: birthdays, Christmas, anniversaries, school clothes, and vacations. But very few of us look ahead and plan for them.
Make a list of the people and the occasions you buy for. In our family we save $30 a week so we can pay cash rather than charge these expenses. ...
For what Long-term Goals Should I Be Saving?
Four common goals for long-term savings are big-ticket items, income replacement, education, and retirement.
The most common big-ticket items are vehicles, down payments on homes, and home furnishings. Again we have the choice of buy now and pay later or save now and buy later. Saving and buying in cash is always cheaper.
Income replacement is another long-term savings goal. If a major illness, accident, layoff, or pay cut hit you tomorrow, how long could you survive? A minimum long-term savings goal is to accumulate three to six months' living expenses in an interest-earning account. This will buffer the shock of having your income reduced or interrupted.
Education for yourself and/or your children as well as saving for your eventual retirement are also valid, long-term savings goals. Since the time line for these goals may be ten to thirty years or more down the road for some of us, we can cross from saving to the art and science of investing, which is a separate topic. When I use the word savings, I mean the guaranteed return of a dollar plus the guaranteed rate of interest over a specific time period. Investments, unlike guaranteed savings, have no certain future value or future income. ...
How Can I Save for the Future When I Can Barely Make Ends Meet Now?
You don't have to earn big money to accomplish your goals if you start now and are persistent and realistic. It took us over twenty years of saving - increasing the amount each year that we saved - to get to where we had savings to cover all the items mentioned previously. We started small and as we reached one goal, we moved to another one. What counts are your attitude and the direction you are moving, not the amount you are saving at first. Resolve to start now. Trust God for guidance, provision, and power.
Excerpted from Your Money and Your Life by Sue Kline, copyright 2000 by The Navigators. Published by NavPress, Colorado Springs, Co., www.navpress.com. All rights reserved. For copies of the book, call 1-800-366-7788.
Sue Kline is the editor of Discipleship Journal, which has won the Evangelical Press Association Award of Excellence three times over the last decade.
Do you save some money on a regular basis? If so, what savings plan to do you follow, and how does it help you meet your short-term and long-term goals? If not, what challenges do you face when considering saving some money regularly? How do you think you might be able to make some changes that would help you save more? Visit Crosswalks forums to discuss this topic by clicking on the link below.
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