12 June 2016

3 Crucial Steps to Making Wise Financial Decisions

Posted in Challenges / Call to Action

Crucial Steps

Our every day life choices have a direct effect on our financial well being, financial security and our financial future. Since we all want to improve our financial outlook, let’s take a closer look at the decisions that we make everyday that could affect us in this area.

Making a decision is the act of selecting when faced with two or more possibilities. We do this automatically hundreds of times a day. Do I answer the phone or let it go to voicemail? Do I brush my teeth this morning? Which route do I take to drive to work today? We all are very good at this. Looking back over the last 24 hours, I’m sure that you can quickly count 20 decisions that you made without any difficulty. If you’ve put a “can’t make a decision” label on yourself, let this serve as an instruction to mentally rip that false label from your thoughts about yourself!

Many of our daily life decisions affect our personal finances in some way. This is easily understood for major financial decisions like deciding to purchase a home, have a baby or start a business. What we may not realize is the fact that we make a larger impact to our overall financial well being as a result of the smaller every-day decisions that we make. Some of these decisions include answers to questions like do I take my lunch to work? Do I buy that toy that my child is crying for today? Should I participate in my company sponsored retirement savings plan?

I've found often times that when we retrace the steps to how we've gotten to an unfavorable financial situation we find that at the point of when we could have made a wise decision, there was no decision to be made. There wasn't an alternative on the table that best aligned with what we say matters most in our lives and in the lives of those that we love. No short-term or long-term plan on the table to oppose the "right now" money-related opportunity. We know what happens then...we go with "Why not??". Opportunity seized!!

When the Lord began showing me visions of how He sees the financial condition of His people, he began a work in me that led me to begin making plans to achieve this vision. I saw visions of His people achieving wealth in a comfortable way that was recognized by believers and non-believers alike. I saw His people using mainstream practices in our everday lives to bring to light the truth that we are a city that sits on a hill that cannot be hidden in the financial arena. I believed it. I began living it with the financial choices that I made. I implemented 3 key financial practices in my life and as a result rarely have a struggle making financial decisions. I have alternatives before me when presented with "right now" money decisions. 95% of the time, I choose to stick to achieving the God-given vision and so far it has paid off! I'm not boasting on myself, but I am boasting in the Lord!

Here's the 3 crucial steps to empower you to make more wise financial decisions.

1. Set Your Financial Goals

...in the presence of Him whom he believed—God, who gives life to the dead and calls those things which do not exist as though they did;
Romans 4:17 KJV

The Christian Holy Bible instructs us to call those things which do not exist as though they do exist. Identify those life accomplishments and life-style realities that are most important to you and your family. Be specific with what the accomplishment looks like and associated dollar value and timeline. For example, a sample goal is We will purchase a family home valued no more than 350k by August 2018. If it means a lot to you, put it on paper and start working toward it!

US Bills 50's

2. Establish Savings

The ants are a people not strong, Yet they prepare their food in the summer;
Proverbs 30:25 NKJV

While on the journey to meet your established goals, there will be detours and potholes that could slow you down or threaten to take you off-course. Establish a savings fund that will be used for those unexpected items. I have savings for emergencies (unexpected medical bills, travel for funerals...) and directed savings (home and car maintenance, family reunion trip planning). When you dip into these savings, start replenishing the fund as soon as you can so that you won’t get caught without knowing how to handle the next unexpected interruption.

3. Set and execute your every-day financial operating strategy

To everything there is a season, A time for every purpose under heaven:
Ecclesiastes 3:12 NKJV

Now that you have your goals set and are building your savings, it’s time to make a personal vow of how you will operate daily to reach the stated goals. This daily operational practice is the strategy - set of actions outlined that detail the “how” you intend to reach the established goals. This strategy could include practices of limiting spending on lunch during the work week, redirecting those funds to the emergency savings and accounts set aside for reaching the long term financial goals. This is where a spending plan and regular checks and balances to measure progress becomes a requirement.

The thing to remember here is to operate daily in a way that is in line with your long-term goals. Pray and get guidance from the Lord on your current financial season. If this is the season to sow into your long term goals then this may not also be the season for a new wardrobe or to enjoy an expensive family vacation. Seek the Lord for wisdom in this and live by your self-established financial boundaries and vows!

Making a decision is the act of selecting when faced with two or more possibilities. Establish the alternatives to consider when facing money choices and you'll make better financial decisions - guaranteed!


Leave a comment

You are commenting as guest.