Make the Most of Every Opportunity to Prepare for the Future

Every Opportunity Make the Most of Every Opportunity to Prepare for the Future

You Can’t Prepare for Everything, But You Can Try

The last two weeks have brought home to me a pair of realities. The first reality is that we should all try to prepare for the future as best we can, making the most of every opportunity while we still have those opportunities. The second reality is that no matter how prepared we try to be, there will always be circumstances that are unforeseen and beyond our control.

Long story short, the reason I haven’t posted anything over the last few days is that life overwhelmed my plans. My wife and I recently become foster parents, and we took in our first two foster children two weeks ago. Speaking for myself, no amount of training and none of my previous parenting experience prepared me for the last two weeks. Every routine has been at least temporarily disturbed, and as a create of routine, that’s been pretty hard to deal with.

Then last week, just before Thanksgiving, I got a call late in the evening about a family medical emergency. Though the need for me to drop everything and leave town was not immediate, I did end up going out of town for a few days, therefore setting all of my plans aside. Part of that trip was spent talking to family members about the future. Questions about health care costs, insurance, long term care, and many related subjects were on the forefront of our minds.

On my last morning at the hospital with my family member, I was trying to do some work so I wouldn’t be completely behind when I got home. In the middle of that work my laptop locked up and crashed. When I tried to restart the laptop, it was dead. Worst of all, not everything I had on that laptop was backed up anywhere else—including dozens of post ideas for this site—and I’ll admit that the stress of the last two weeks caught up to me to the point where I was just short of screaming in frustration.

Now, a few days on the other side, I think I’ve discovered the problem with my laptop, and have been able to recover all my data. I’m slowly copying several hundred gigabytes of data to another drive as I sit here and write, and the replacement part I think I need to repair my computer should be here in a few days at a total cost of $50.

My family member is doing well, but has a lengthy recovery ahead. We were also able to at least get a start on figuring out all the plans we need to make as a family for the well-being of those involved. Those discussions will continue, but it’s a start.

Don’t Wait Until It’s Too Late!

What am I getting at here? Am I just moaning in hopes that some of you reading will commiserate and write some nice comments? Not at all. I’m imploring you to take advantage of every opportunity to prepare for the future while you still have opportunities available.

If you’re under 40 and haven’t started saving for your retirement years, you need to start now. Don’t make the mistake of thinking you’ll be able to comfortably rely on something like Social Security or Medicare to take care of you. Don’t lie to yourself and say, “I’ve got plenty of time. I’ll start saving later.” Even if you’re over 40, do something to prepare.

If you’re still in debt, I implore you to stop going deeper into debt and begin earnestly and intentionally working to get yourself free of debt as soon as possible. Yes, I’m a Dave Ramsey disciple, but I really don’t care how you get out of debt, just do it!

Get yourself all the different insurances you need, including a good health plan and disability. You may tell yourself you can’t afford it now. That’s all the more reason to get yourself out of debt and free up your resources to plan for calamity. And don’t forget to begin thinking about the need for long-term care insurance. No, you don’t need to actually purchase it until you’re 60, but you need to make plans to be able to afford it when the time comes.

And for goodness sake, learn from me and back up your data!

Are You a Good Financial Steward or a Usurper?

Good Steward or Usurper Are You a Good Financial Steward or a Usurper?

One of the key truths about financial health and responsibility is the concept of good stewardship. Stewardship is a word that isn’t often heard outside of churches in today’s word, and all too often the word’s meaning has been redefined to mean “capital fund raising.” Otherwise, the word is most often spoken in the same breath as tithing—a proper use to be sure, but stewardship is so much more.

In reality, stewardship is a foundational concept of life, not only a financial concept. Stewardship applies to all material things that come under our personal control. Stewardship is an old concept that we don’t relate to very well today. Back in the days when our world was mostly ruled by royalty—think medieval times or older—governmental structures were quite different than what we see today. It’s in reading history that you can see stewardship in action.

A monarch’s will could never be carried out without help, so kings and queens appointed lords to impose their will throughout the land. These people—dukes, barons, and the like—were referred to as lords because they were given lordship over a portion of the kingdom’s land and the people who lived there. It was the lord’s duty to carry out the will of the monarch—to be the monarch’s steward of the land and the people. Yes, great privileges were given to these lords, but all that could be stripped away in an instant if those lords were not good stewards.

Throughout history you find stories of lords who were either good stewards or usurpers of the monarch’s authority. A usurper need not be someone who takes up arms to depose their monarch. A usurper can simply be someone who fails to recognize that their authority and material wealth is borrowed and begins to act as if the kingdom is their own.

Isn’t that what too many of us do in our own lives, especially with our finances?

Oh, it’s easy to get this way, I know. Much of our outlook on life concerning material wealth comes from what we’re taught—whether by our parents, our teachers, or our culture. There is a dearth of proper financial training in today’s world, especially related to the concept of being good stewards of what we’ve been given.

This is the paradigm shift in our core beliefs that must take place. We have to come to the place were we understand and believe that everything we have is something we have been given. Who gives it all to us? I believe that it is God who provides all things.

That belief doesn’t line up with what modern culture tells us. The politically polarized climate offers up conflicting beliefs about where material wealth comes from. One side says that its gained through hard work and personal responsibility. The other side would tell you that we need an entity like the government to come in and make it fair for everyone and close the gap between the haves and have-nots.

Neither of those sides take true financial stewardship into account.

Should we work hard and take personal responsibility? Absolutely. The Bible tells us that the diligent prosper (Proverbs 13:4), but it also teaches that the obedient will prosper as well (Deuteronomy 5:33). Part of that obedience is to also care for the poor, the helpless, and widows and orphans. (Here’s a long list of applicable verses.)

Scripture warns us away from debt and encourages us to save, plan for the future, and make wise financial decisions (see Proverbs 13:22, 21:20, 22:7; Luke 14:28). These are the actions of a good steward. A usurper forgets where all good things come from and think they should rule their own kingdom any way they please. But a steward has responsibilities, and if we fail to meet those responsibilities we become tiny tyrants desperately striving to go our own way.

How to Keep Black Friday from Sending You Into the Red

Black Friday How to Keep Black Friday from Sending You Into the Red

This post is probably too late for anyone who’s already headed out the door into the crazy world of Black Friday shopping. If so, perhaps you can consider how to better prepare for next year’s Christmas shopping now.

I was somewhat shocked when I opened up the Wall Street Journal last Wednesday and read about how American debt was on the rise again. Much of this is due to the feeling among most Americans that the recession is over. Job prospects seem better and the housing market is in full recovery, so consumer spending and borrowing has been on the rise since the last quarter of 2007.

There was a bit of good news in the article because credit card debt has fallen $159.08 billion since 2007, but it’s on the rise again. If credit card debt follows the trend that mortgages, auto loans, and students loans have over the last 1 to 2 years, then you can expect Americans to to add several trillions in debt in the years to come. As a culture, we’re well on our way to surpassing the 2008 peak of $12.36 billion in total household debt.

Black Friday is a Two-Way Street

It’s no secret that many retailers depend on the Christmas shopping season for a large portion of their yearly profits. If you think about it, this obviously means that the vast majority of America’s household consumer debt is accumulated during this same season. Even though Black Friday spending was down last year, the average Black Friday shopper still spent $407.

How much of that spending do you think was planned? I don’t mean planned as in, “Hey, this look like a great gift as a great price. We should buy it!” By planned I mean the money for Black Friday purchases was in the budget and set aside in cash.

The truth is, most American’s can’t afford Black Friday.

Redefining Affordable

The word affordable in today’s culture is usually measured by whether we can make the monthly payments. We walk into a store, find a product we want to buy, try to get the best financing possible, and then see if we have enough wiggle room in the “budget” to cover the added drag on our income. Then, the next time we find a product we want, we simply repeat the process all over again.

Now consider that on Black Friday, not even this much forethought takes place. Such frenzied shopping only allows for a mad dash to the back of the store while delivering a well-placed elbow or two to grab the day’s prize. Then it’s an upstream swim to get to the cash registers and swipe whichever credit card hopefully has enough to cover the purchase. There’s no thought about the cost until the credit card bill comes in just after Christmas, completely ruining our festive mood.

I’ll admit that I once lived this way. Though I’ve never been out shopping on Black Friday, I can’t recall how many times I purchased something without any real thought. The only question that ever entered my head was the one I asked my wife: “Do we have enough money left at the end of the month to cover paying for this thing I want?”

There’s a better way to spend money.

Let’s redefine affordable to mean what it meant to our grandparents and great-grandparents. Do you realize that the contemporary concept of consumer credit wasn’t introduced to the world until 1950 when Diner’s Club came on the scene? How did people possibly get by?

Cash.

If you want to keep yourself out of the red on Black Friday, and any other day for that matter, you need to redefine the answer to “Can I afford this?” for yourself. Here are a few questions you should ask yourself:

Determining if You Can Afford to Make a Purchase

  1. Do you have the cash for the purchase? The first step of redefining affordability is pretty simple. If you don’t have cash on hand to cover the purchase, you can’t afford it. If you have to borrow a single dime or put a single penny on a credit card, you can’t afford to make the purchase. You’re choosing to not live within your means. You’re choosing instant gratification over wisdom.
  2. Have you planned ahead for the purchase? Is it part of your budget? Let’s say you want to buy a new TV. This isn’t to say you need to have a specific line item in your budget labeled “TV,” but at the very least you should have a line item labeled “Christmas purchases” or “gifts” AND it should have enough cash available to fully fund your TV purchase. If you haven’t budgeted for your purchase, you can’t afford it.
  3. Have you searched for the best deal? This time of year, there are dozens of deals available, but before handing over your hard-earned cash, make sure you’ve diligently searched for the best deal. Nowadays, you can often find deals as good or better online compared to the stores. In fact, if you search deep enough, you’ll probably find a better deal. This is true especially when you consider that many of the “doorbuster” deals on Black Friday are for relatively low-quality products, or for a very limited supply. It may be worth spending a bit more to get a better quality product. And if you find a better quality product that you don’t have enough cash for, just be patient and save up a little while longer.
  4. Will you have to “steal” money from somewhere else in your budget to make this purchase? Part of making sure that you really have the cash to afford your purchase is that you’ve specifically set the money aside. Don’t even consider using money that you’ve put aside for another purpose.
  5. Are you planning to take money from your emergency fund or long-term savings? Buying Christmas presents is NOT an emergency. Christmas comes around in twelve month intervals, so it’s not a surprise. You’ve had an entire year to plan and set money aside for your purchases. Please don’t be foolish and steal from your future either. Leave your hard-earned savings alone.

In the end, make sure that you don’t come to regret your purchases by sinking yourself further into debt, making an impulse purchase, or not searching for the best deal possible.

When you come to the realization that debt is like a great weight dragging you down and keeping you from reaching your financial goals, you’ll do all that you can to keep from adding to that debt. You’ll learn that delaying gratification and keeping yourself from making foolish purchases is far more satisfying in the end that the temporary pleasure your purchase might bring.

Here’s a handy flowchart to help you make a better decision.

Can I Afford this Purchase Flowchart How to Keep Black Friday from Sending You Into the Red

Adapted image by Christian Ferrari

Happy Thanksgiving from The Incremental Life

1 Chronicles 16 34 Happy Thanksgiving from The Incremental Life