Budgeting, College Debt, Kids & Money, Money Management, Saving, Student Loans

Ask Chuck: How Do I Financially Prepare My Child for College?

By: Chuck Bentley, Crown Financial Ministries

Dear Chuck,

I’ve tried to prepare my daughter to handle money responsibly while she’s away at college. But, I’m concerned that peer pressure and the stress of classes will throw her off track. Any tips?

Budget-Minded Mom

Dear Budget-Minded,

Congratulations are in order for preparing her for this crucial transition. Far too many students leave home without a clue how to manage money and are vulnerable to making life-altering messes.

While most Americans assume that student loan and consumer debt is the only way to get a college education today, this is simply not true, regardless of income. I have a friend who immigrated here from China. She only had $2,000 to help her daughter when she left for college. When her daughter finished her undergraduate and decided to seek a master’s degree, her mother asked if she needed financial help. Turns out that her daughter had been able to graduate without borrowing money and still had cash in the bank. She explained that she had been saving and investing for years and had $70,000 cash in the bank before entering grad school!

Financial preparedness for college students and young adults is crucial today. Demands come from all directions and unless students understand the value of a dollar, they can blow through spending money and quickly rack up consumer debt and long-term student loan debt before they ever realize the consequences ahead. 

Having raised four sons, we can appreciate your concerns but also want you to know that it is possible for our children to swim against the tide. 

Set Clear Boundaries

Make sure there is a clear understanding of what you will pay for and what your student is required to cover. Typically, students are more careful with the money they have earned, so avoid robbing them of an important lesson by giving them everything. 

For example, if they have a car at college, determine who will pay for gas, insurance, tags, parking, maintenance, and repairs. If they’re going to be responsible for those expenses, then they need to find a part-time job. That’s real life! If you plan to cover the expenses, have clear stipulations and terms (e.g. you’ll only cover those costs as long as they remain in school and maintain a decent grade point average). Every family situation is different, but the goal is to grow financially mature adults.

Some Practical Tips 

Here are a few additional tips you may want to teach the young people in your life:

  • Exercise self-control. Don’t drink, smoke, or binge with money
  • Live like you’re poor in college and you won’t be when you graduate!
  • The earlier you save and invest, the more you’ll have for your future
  • Boundaries now grant freedom later
  • Be careful loaning money
  • Keep healthy snacks on hand and in a backpack
  • Use cash to avoid overspending
  • Avoid debt. Period. Set a goal to graduate without student loans or consumer debt.

What They Need to Know

  • How to use a checking account and debit card – understand bank fees
  • How to make deposits into a savings account – preferably at a different bank to avoid easy withdrawals
  • How to use a credit card wisely – pay it off in full each month
  • How to make a budget and keep track of expenses
  • The importance of good credit and how to establish it
  • The joy of giving and saving with intentionality
  • Student loans will be offered but try to avoid them

Prevent Medical Expenses

  • Cook healthy meals or use a meal plan wisely
  • Sleep, exercise, avoid alcohol and drugs
  • Seek a community of Godly friends
  • Take care of mental health: limit social media, join a church, volunteer

Practical Tips

  • Keep $100 tucked away in your wallet for emergencies only
  • Guard personal information
  • Know how and where to buy/sell used textbooks
  • How to study well, apply for scholarships, and work part-time
  • Know identity in Christ to withstand peer pressure, FOMO, and comparison traps
  • Live at home or with another relative to save dorm/apartment fees
  • Know how to make coffee, cook, and do laundry
  • Get to know the financial aid counselors
  • Work on campus: saves time/gas, and opens doors to deeper relationships with staff

Preparing our youth financially will give them a step ahead of most people. Diligence requires purpose, intentionality, and resolve. It requires renewing the mind and working toward specific goals. May they be filled with the understanding of who they are in Christ and the knowledge that they are stewards of what He gives.

And whatever you do, in word or deed, do everything in the name of the Lord Jesus, giving thanks to God the Father through him. (Colossians 3:17 ESV)

Whatever you do, work heartily, as for the Lord and not for men, knowing that from the Lord you will receive the inheritance as your reward. You are serving the Lord Christ. (Colossians 3:23-24 ESV)

By discussing your daughter’s financial needs, desires, and habits regularly now, you can help her avoid the mistakes that most make plus prepare her for the next stage of her career without the bondage of debt-driven decisions.

Read More
Budgeting, Finance, Gas, Money Management, Saving

How to Deal with Inflation and Rising Costs

By: MoneyWise

The latest Consumer Price Index was released today, posting an 8.6% annual increase in May. That’s the highest increase the U.S. has seen since 1981. More importantly, it tells us that goods and services are becoming more and more out of reach. Reports have shown that these increases have already slowed discretionary purchases. Basically, that tells me there’s a lot less vacation and leisurely spending going on right now.

Our regular contributor and Compass Australia founding member, Gwenda, touched on saving the other day. And in times like this, I think it bears repeating: “The Bible encourages us to save and is loaded with great practical advice.”

That’s from the last time we heard from Gwenda. And as prices rise, we’re reminded of just how much wisdom God’s Word contains. Not everybody feels the effects, but many of us do. And one thing to weather it is to do exactly what the Bible says. As Gwenda mentioned, there’s a saying: “Save for a rainy day.” A step further, Proverbs 21:20 says that the wise save for the future, but the foolish spend whatever they get.

Sometimes, it can be hard for us to save when we don’t know what we’re saving for. But if the cost of just about everything is going up and it’s affecting you, this is the case in point for why the Bible tells us we must save. Having savings set aside right now would help weather rainy days like this.

If you’re asking how would you save, here are a few ways to get started:

  1. Make it automatic – Gwenda mentioned the automatic savings plan, as well. It’s an amount you decide and set up typically through your bank.
  2. Budget – Another recommendation by Gwenda. But don’t let this word scare you.
  3. Cut Back – I consider this separate from budgeting because the way I see it, just because I budget or plan for something, it doesn’t mean it’s necessary.

An automatic savings plan encourages you to save first, spend second. If you tithe and “pay yourself” first, you’re required to work with what’s left. A much better formula for putting more aside than if you were to spend first, save second. Saving whatever’s left over usually encourages more spending.

“Budget” is just a technical term for telling the money where to go, not the other way around. And when I say cutting back is separate from budgeting, here’s what I mean…

In our budget this month, my husband and I have planned to spend no more than $150 on dining. How much of that has to be spent, though? Well, the answer is $0.

We have to eat, but we don’t have to do that by going out to restaurants or taking out. This is my point: If you study your budget, chances are you’ll find one or two categories that either can be reduced or don’t need to be there at all.

The Building Your Finances God’s Way financial discipleship study dives even deeper into the concept of saving and much more. I encourage you to sign up for a study right here. Because it’s not just about weathering your storm.

Putting these three things into practice helps us become better financial disciples: One who can live in contentment, knowing no matter what, God provides; who can live life applying finances God’s way, giving cheerfully and with the assurance that it shall be given unto them, pressed down, shaken together, running over (Luke 6:38); and who shows others how to do the same and that there’s a reason why faith and love get us through anything and everything life throws our way.

Read More
Activities, Budgeting, Money Management, Saving

Ask Chuck: Help Me Get Our Spending Under Control

By: Chuck Bentley, Crown Financial Ministries

Dear Chuck,

We have to cut our spending this year, but I really don’t know where to begin. When I bring up the subject, my spouse always has an excuse. If we don’t get things under control, we are going to face eviction from our landlord. 

Cash Crunch

Dear Cash Crunch,

I’m so glad that you wrote to me and are ready to make some big changes. My hope is that if you set a clear direction, your spouse will be inspired to join in the effort. Forced eviction is devastating emotionally; it is expensive and wrecks your credit score. Let’s work hard to avoid it!

Some of the obvious ways to reduce spending include eliminating the big expenses, like a car payment or rental/living costs in excess of 40% of your net spendable income. Look at both of those expenses closely, and determine if you need to make any changes. If not, there are some not-so-obvious ways you can save money each month that really add up over time. Cutting what seems like a necessity may seem impossible, but over time, the sacrifice will prove rewarding. Here are a few examples I want you to consider.

Do You Really Need Amazon Prime?

Membership fees jump for new members on February 18th. Renewals take the hit on March 25th. The annual cost will be $139/year plus taxes or $14.99/month plus taxes. An alternative is to keep a shopping list until you reach a total that qualifies for free shipping from Amazon or other companies. You may have limited shipping options, but this leads to better planning and less impulse purchasing. You can also use Amazon gift cards to limit spending since a credit card is not linked to your account.

Do You Really Need That Streaming Service?

According to The Streamable, in 2021, the average viewer had five or more subscriptions. The top five include Netflix, Amazon Prime, Disney+, Hulu, and HBO Max. In May 2021, Bloomberg reported that the average streaming consumer spends $40 per month. That comes to $480 per year! Different streaming prices can be seen here. The average cost of cable TV comes in at $64 but can run from $11 to $127 or more per month.

Do You Really Need Audible or Spotify?

Free audiobooks are available via Overdrive and Hoopla with a library card. Spotify and other small monthly fees that seem insignificant can really add up. Nothing is too small to eliminate to help you avoid eviction!

There’s More

Look at your spending with a critical eye. What could you realistically eliminate? What are your real needs? What do you need to reprioritize? Small daily purchases can add up quickly.

Analyze what is spent on subscription services, fast food, coffee, bottled water, shoes, clothes, gym membership and gear, house plants, manicures, pedicures, tattoos, haircuts and color, lottery tickets, toys for children, etc.

Challenge

Ask your spouse to join you in tracking all spending for the next 30 days. When Ann and I did this years ago, we found that recording each dollar spent made us more aware of our actions. We realized that we had some costly habits. Write down your expenses. Don’t leave anything off your list so that you know where your money is really going.

After 30 days, come together and share what you learn. It may only take a few days before a heightened awareness sets in. Prayerfully discuss what you could sacrifice for six months or a year. I suggest you gently educate your spouse on the long-term benefits. Can you agree to get the help of a mentor or come under the accountability of trusted friends? How about planning a reward when reaching your goal? You can likely cut back on your spending by 25% by just changing some of your habits.

Once you get your spending under control and avoid eviction, there are many other reasons people decide to better manage their money. Reduced spending builds the habit of saving, and with the help of automatic deductions, people learn to live without. The possibilities can include:

  • Building an emergency fund
  • Paying off debt
  • Saving for retirement
  • Giving more generously
  • Having funds for vacations, a move, a business, education, holidays, births, deaths, etc.

Years ago, a woman confided in my wife that she was tired of her husband limiting her spending. She felt like she was being treated as a child. Ann listened and then asked, “Have you considered the possibility that he loves you so much that he wants to protect you and save for your future together?” The thought had never entered the woman’s mind. It changed her entire perspective and opened the door to healthy dialogue about their finances.

We enter marriage with a philosophy of money. Most often, we marry an opposite. The goal is uniting around God’s principles regarding our finances. Pray about how to lovingly communicate with your spouse. Treat him/her with respect and love so you can make progress. My desire is to see God’s people free and marriages united, strong, and thriving. We must recognize the errors in what the world has taught us about finances and have our minds renewed by God’s truth. Consider this effort to lead the way out of this crisis the best gift you can give your spouse.

If credit card debt is a source of frustration in your marriage, consider contacting Christian Credit Counselors. They specialize in assisting people with getting out of debt and on the road to financial freedom, and they are a trusted source of help.

Read More
Budgeting, Debt, Money Management, Saving

Ask Chuck: Time to Get Out of Debt?

By: Chuck Bentley

Dear Chuck,

I have been steadily paying down debt, and the end is within sight. I’m due a sum of money for the sale of some real estate and wonder if I should pay off the remaining debt or save it. Seems like a good time to be debt-free. What would you do?

Almost Debt-Free

Dear Almost Debt-Free,

I can think of only a few reasons why you would not go ahead and become debt-free if you are able. Of course, I don’t have your full financial picture, so I will try to give you a few things to consider as you come to your own conclusion.

Shifting Sands

There is a lot of uncertainty in the world right now. Covid-19 has created stress in many areas of our lives. A Pew Research Center survey reports that half of the non-retired adults say the economic impact of Covid-19 will make it harder to achieve their long-term goals. There are medical and financial pressures along with rising mental health issues. Add to that inflation, the instability in Afghanistan, forest fires, flooding, the possibility of a stock market, and real estate bubble… Need I go on?

A major benefit to being debt-free is that you will be in a much stronger position to weather the economic storms we may face. If your overall picture is good, then pay off all the debt. But, there is more to consider first.

A Safety Net

It is great to be debt-free, but uncertain times also require that you have savings available for emergencies. You want to avoid ending up in the same position six months from now. Therefore, I suggest you give a portion, fund an emergency account, and then apply the rest to debt.

Have you ever done the limbo? The object is to get under a bar without touching it. Budgeting is very similar. Your income represents the bar. Your spending must fall below the bar every month, or you lose.

In limbo, you must take carefully-measured steps to keep as far away from the bar as you can. The gap between your body and the bar is what I call “financial margin,” which we all need. This is the space that grants peace and financial protection in the unexpected storms of life.

It is possible to increase your monthly margin quickly by adjusting your lifestyle. Consider the benefits of choosing to live on far less than you make. Manage the common budget busters—food, entertainment, and transportation—to further reduce expenses.

Other Tips

Paying down the highest interest-bearing note first will save you money in the long run. Paying down multiple small notes can provide a psychological advantage. Repay any late mortgage or rent, utilities, HOA fees, taxes, and car payments so there is no threat of losing your home or car.

Do you owe family members any money? Do not ignore this responsibility. Be honest, and treat them as you would want to be treated so that relationships are not harmed.

Be Intentional 

Even if you do pay off all your debt, it is important to manage your finances well as you go forward. Just because you become debt-free does not guarantee that you will stay that way unless you manage what you have well. Here are my three tips:

  1. Plan ahead: Commit your work to the Lord, and your plans will be established. (Proverbs 16:3 ESV)
    • Budget wisely. This will keep you from creating more debt and will allow you to build an emergency savings fund. If needed, a crisis budget can get you to a position of financial strength. Here are instructions, an online fillable form, and a spending plan.
  2. Seek counsel: Without counsel, plans fail, but with many advisers, they succeed. (Proverbs 15:22 ESV)
    • Please consider my advice as only one source of those you will turn to for help.
  3. Make wise decisions: If any of you lacks wisdom, let him ask God, who gives generously to all without reproach, and it will be given him. (James 1:5 ESV)
    • God is the source of all wisdom. When we learn His Word and commit to live by it, everything in our lives will begin to take on new excitement and joy. Using money to fulfill God’s purposes for your life will be the best financial decision you can make.

Thank you for the question. I don’t think you can go wrong if you pay off the debt and commit to following the steps above.

For more guidance, especially if your debt is related to credit cards, please consider contacting Christian Credit Counselors. They are a trusted source of help.

Read More
Retirement & 401k, Saving

6 Reasons Why You Shouldn’t Wait Until You Make More to Save More

By: Art Rainer

“I don’t make enough money to save for retirement.”

This is a common reason people provide, especially those just starting out in their careers, for not saving. Their plan is to start saving when they feel like they are making enough money.

Unfortunately, this mindset often leads to a stressful financial future. And it could have been avoided.

Here are six reasons why you shouldn’t wait until you make more to save more:

1. The Bible teaches us that saving is wise.

Proverbs 6:6-8 says this—Go to the ant, you slacker! Observe its ways and become wise. Without a leader, administrator, or ruler, it prepares its provisions in summer; it gathers its food during harvest. Throughout Scripture, we are taught that we should capitalize on times of abundance to get us through times of scarcity. For retirement, this means taking advantage of a paycheck to get you through a time when you no longer receive income from an employer.

2. Habit-building starts now.

Habitually setting aside money for the future does not magically begin when you have more income. The best way to ensure you will actually take advantage of a higher salary is to regularly save now, regardless of your paycheck’s size.

3. Great income is often followed by greater expenses.

When people get a raise, savings is not normally the first to increase. Expenses do. We make more so we spend more. The financial margin remains thin, even with a greater income.

4. For some, “enough” never happens.

Sometimes, this happens because their career never takes off as they hope. Other times, even though their income has increased, they don’t feel like they make enough.

5. Compounding.

It is said that a reporter once asked Albert Einstein what he considered to be the greatest invention of all time. His response? “Compound interest.” Compounding is earning money on your earned money. And the best way to take advantage of compounding is to start early. Remember this formula:

A little bit of money + A lot of time = A lot of money.

6. The mantra, “It’s never too late to start all over again,” won’t be as comforting as you think in the future.

Certainly, you can start habitually saving at any point. But you can never truly recapture lost time. Every month you delay saving is a month you never get back. It is a month that you are never able to take advantage of compounding. When you delay your retirement savings, you make your climb to retirement steeper.

Don’t wait until you make more money to save more money. Start now. Make it your goal to place 15% of your gross income into retirement savings. Whether you make much or little, now is the time to save for retirement.

Read More
Finance, Goals, Money Management, Saving

Rebuilding toward a Brighter Future with Emergency Savings

By: Consumer Financial Protection Bureau (CFPB)

This year, for many Americans who experienced financial challenges as a result of the coronavirus pandemic, preparedness means taking small steps toward rebuilding and resilience.

If you are ready to think about your bigger financial picture for the first time in months, what’s the first step?

Consider – or start – your emergency saving fund. As you build it over time, it will help cover unexpected expenses that may come, whether that be a natural disaster, unexpected illness, car trouble, or other financial downfalls. It can become an important means for avoiding unwanted debt and help you more quickly realize your dreams. In short, it can become a strong foundation for your financial future.

There are different strategies to get your savings started. These strategies cover a range of situations, including if you have a limited ability to save or if your pay tends to fluctuate. It may be that you could use all of these strategies, but if you have a limited ability to save, managing your cash flow or putting away a portion of your tax refund are the easiest ways to get started.

Strategy #1: Create a savings habit

Building savings of any size is easier when you’re able to consistently put money away. It’s one of the fastest ways to see it grow. If you’re not in a regular practice of saving, there are a few key principles to creating and sticking to a savings habit:

  • Set a goal. Having a specific goal for your savings can help you stay motivated. Establishing your emergency fund may be that achievable goal that helps you stay on track, especially when you’re initially getting started. Use our savings planning tool to calculate how long it’ll take you to reach your goal, based on how much and how often you’re able to put money away.
  • Create a system for making consistent contributions. There are a number of different ways to save, and as you’ll read below, setting up automatic recurring transfers is often one of the easiest. It may also be that you put a specific amount of cash aside each day, week, or payday period. Aim to make it a specific amount, and if you can occasionally afford to do more, you’ll watch your savings grow even faster.
  • Regularly monitor your progress. Find a way to regularly check your savings. Whether it’s an automatic notification of your account balance or writing down a running total of your contributions, finding a way to watch your progress can offer gratification and encouragement to keep going.
  • Celebrate your successes. If you’re sticking with your savings habit, don’t miss the opportunity to recognize what you’ve accomplished. Find a few ways that you can treat yourself, and if you’ve reached your goal, set your next one.

Who is this helpful for: Anyone, but particularly those with consistent income. If you know you have a regular paycheck or money consistently coming in, you can create a habit to put some of that money towards an emergency savings fund.

Strategy #2: Manage your cash flow

Your cash flow is essentially the timing of when your money is coming in (your income) and going out (your expenses and spending). If the timing is off, you can find yourself running short at the end of the week or month, but if you’re actively tracking it, you’ll start to see opportunities to adjust your spending and savings.

For example, you may be able to work with your creditors (like your landlord, utility companies, or credit card companies) to adjust the due dates for your bills, or you can use the weeks when you have more money available to move a little extra into savings.

Who is this helpful for: Anyone. This is one important first step in managing your money, regardless of whether you’re living paycheck to paycheck or have a tendency to spend more than your budget allows.

Strategy #3: Take advantage of one-time opportunities to save

There may also be certain times during the year when you get an influx of money. For many Americans, a tax refund can be one of the largest checks they receive all year. There may be other times of the year, like a holiday or birthday, that you receive a cash gift.

While it’s tempting to spend it, saving all or a portion of that money could help you quickly set up your emergency fund.

Who is this helpful for: Anyone but particularly those with irregular income. If you receive a large check from a tax refund or for some other reason, it’s always good to consider putting all or a portion of it away into savings.

Strategy #4: Make your saving automatic

Saving automatically is one of the easiest ways to make your savings consistent so you start to see it build over time. One common way to do this is to set up recurring transfers through your bank or credit union so money is moved automatically from your checking account to your savings account. You get to decide how much and how often, but once you have it set up, you’ll be making consistent contributions to your savings.

It’s a good idea to be mindful of your balances, however, so you don’t incur overdraft fees if there’s not enough money in your checking account at the time of the automatic transaction. To help you stay mindful, consider setting up automatic notifications or calendar reminders to check your balance.

Who is this helpful for: Anyone, but particularly those with consistent income. Again, you can determine how much and how often to have money transferred between accounts, but you want to make sure you have money coming in. If your situation changes or your income changes, you can always adjust it.

Strategy #5: Save through work

Another way to save automatically is through your employer. In addition to employer-based contributions for retirement, you may have an option to split your paycheck between your checking and savings accounts. If you receive your paycheck through direct deposit, check with your employer to see if it’s possible to divide it between two accounts. If you’re tempted to spend your paycheck when you get it, this is an easy way to put money aside without having to think twice.

Who is this helpful for: Those with consistent income. Again, if you’re getting a check from your employer on a regular basis, pay yourself first by putting a portion of it automatically into savings.

It might seem impossible to save enough to get you and your family through something like a furlough, job loss, or reduced hours. But any amount can make a difference and it’s never too late to start. The more you can save, the better you can weather the worst, and the faster you can recover when it is over.

Read More
Budgeting, Economy, Finance, Money Management, National Debt, Saving

Ask Chuck: Practical Advice During the COVID-19 Crisis

By: Crown Financial Ministries

Dear Chuck,

Many of the young people in my Bible Study are frightened of the Coronavirus and the threat to their families. I understand their fear. But, as an older American, I’m also concerned about their economic well-being in the aftermath of this crisis. What kind of financial advice can I offer them?

Sheltered in The Storm

Dear Sheltered in the Storm, 

We have two crises happening now and you have properly identified the third one. First, the virus has created a very real health crisis. Second, the shutdown of the economy has created a very present economic crisis and third, the government bailout will put us at risk of a future debt crisis and threat to the global economy. 

As Thomas Sowell said about our current challenges, “We do not have good choices, we simply have trade-offs.” 

Living on the Edge

The Coronavirus has revealed the financial unpreparedness of millions of citizens. Aaron Zitner, at the Wall Street Journal, reports: “Some 15% of Americans have used, or plan to use, either short-term loans or credit cards that they don’t know they can repay in order to buy emergency goods to deal with the outbreak, a survey by NORC at the University of Chicago found.” He says others rely on savings or plan to divert money set aside for other things.

It is my hope that many Americans have been better prepared for this event after making financial adjustments following the Great Recession, which started in 2008, by paying off debt, increasing savings, and living within their means. Either way, here are some practical and spiritual insights for the young people in your Bible study. 

Establish Essentials as Priority

Everyone’s situation is different. Let’s help the young people understand how to deal with the current economic crisis, and we will deal with the long-term consequences of the bailout later. Here’s how I would attempt to help those in your Bible study when meeting one-on-one. 

Regardless of what’s happening in the world, everyone needs food and shelter. Pay the bills that provide food, home, and necessary utilities. This is a time to sacrifice wants to provide for needs.

Most middle-income families will receive some sort of government assistance money. Establish or grow your emergency savings account. Always keep it resupplied as you are able. 

With job cuts right now, childcare and transportation costs may drop significantly. If possible, save that money in an emergency fund for future needs. Even a small amount in a savings account will reduce financial stress and grant margin in your life. Exercising self-control (a fruit of the Spirit) will boost your confidence and grant hope.

Face your bills with courage and hope. Pray over them and ask God to work in miraculous ways knowing He is able to do far more than you can imagine. Avoid fear and anxiety with this verse:

“Rejoice in hope, be patient in tribulation, be constant in prayer.” (Romans 12:12 ESV)

Practical Steps 

  • Limit social media to avoid online shopping. Don’t give in to your (or your children’s) wants right now. Lead by example in love.
  • Student loans: this may be the time to refinance.
  • Debt: negotiate with lenders to reduce your interest rate or balance. Seek to eliminate penalties. Demonstrate your intent to pay. Avoid maxing out credit cards. Consider balance transfers but read all the fine print. Set a goal to eliminate the debt and the method to get there (I recommend the snowball or avalanche methods). Contact Christian Credit Counselors if you are falling behind. 
  • Insurance: assess coverage and negotiate the cost. Some coverages may not be a necessity or deductibles may need to be raised to lower premium costs. 
  • Make a will. Don’t procrastinate.
  • Save: deposit something weekly, or every other week, to develop the habit. Get a fireproof, waterproof safe to keep some cash at home at all times. I recommend one month of living expenses. 
  • Wisely use your government check if you have an emergency savings account: give a portion, pay current bills, and pay down debt.
  • Income tax filing has been postponed until July 15th. If you owe money, set that money aside in a separate account.
  • Ask for help. Trade skills: haircuts for food, tutoring for computer help, etc.
  • Sell what you don’t need. Facebook Marketplace and Craigslist make it easy. Do it safely by meeting buyers in a grocery or government parking lot during daylight hours.
  • Look for opportunities. This may be the best time to start a business or take on greater responsibility at your current place of employment. Learn new skills. Take advantage of online classes. Educate yourself by reading, listening to books, watching Ted Talks, and documentaries.
  • Be generous. There are many suffering at this time. Be exceptionally generous while also being wise and discerning.

Hope for Troubling Times 

Those who are frightened, worried, angry, or frustrated must remember they are not alone. God has not left us on our own. In fact, idols are being revealed and priorities analyzed. It’s time to reorient our lives.

We all know we should live one day at a time. That requires taking one step at a time. But, what if fear overwhelms you and you don’t know what steps to take?

Imagine a sailboat drifting in the center of a large lake with no apparent destination in sight. It rocks back and forth, back and forth, unable to move forward. Suddenly, the wind begins to blow. The sails of the boat filled with air. The sailor takes action and strategically directs the boat to the desired destination. The boat glides effortlessly while the sailor works with the wind to safely arrive to shore.

The Holy Spirit is the wind. He fills our sails enabling us to know when and how to move forward. Filled with hope, we develop perspective and work toward our destination.

“May the God of hope fill you with all joy and peace in believing, so that by the power of the Holy Spirit you may abound in hope.” (Romans 15:13 ESV) 

Not Our First Rodeo

Like you, I have lived long enough to have experienced a number of crises in my life. As my friend said, “this is not my first rodeo, but this is the first time I have ever ridden this horse!” We are living through something the world has never experienced. It’s an opportunity to trust God with all our heart. May He fill you and me with all hope so we can proclaim His goodness. 

 “…we rejoice in our sufferings, knowing that suffering produces endurance, and endurance produces character, and character produces hope, and hope does not put us to shame, because God’s love has been poured into our hearts through the Holy Spirit who has been given to us.” (Romans 5:3-5 ESV)

For anyone struggling with credit card debt, get in touch with our partners at Christian Credit Counselors. They can advocate for you, helping lower payments, and organize your debt. Start your free debt analysis today.

Read More
Identity Theft, Saving, Taxes

How to Use Your Tax Refund to Build Your Emergency Funds

By: Consumer Financial Protection Bureau (CFPB)

During tax season, there’s a lot to think about. Do you have the right forms? Where did you put those receipts? Did you do the math right? But there’s one more thing you should be thinking about: how you can use your tax refund to ramp up your emergency funds or reach other savings goals.

In 2019, around 72% of Americans received a refund on their taxes. This extra jolt of cash can be a perfect opportunity to start—or increase—your emergency savings funds.

Why save your tax refund

Your tax refund may be one of the biggest checks you receive all year. If you’re getting a tax refund, consider saving some or all of it. Putting your refund into savings can help you prepare for unforeseen expenses throughout the year, and work toward longer term savings goals such as buying a house or paying for college.

For many people, making ends meet throughout the year is tough, and saving regularly may seem unrealistic. The money you get in your tax refund could help you build or replenish your rainy day fund. Setting aside money for emergencies may help you cover some of the most common unexpected expenses people experience. Without savings, a financial emergency–even minor–could have a lasting impact on your financial well-being.

How to save money fast

Here are four things to do to save your refund as quickly and securely as possible.

1. Plan ahead

It’s likely that you already have plans for what to do with your refund—many people do. But, if you can plan to save part of your refund, even just a small amount, it could help you down the road when an emergency occurs, or you need a little extra cash to meet a financial goal.

Make a plan to save some of your tax refund, and then use this worksheet to help you make the most of your tax refund.

2. File electronically

The fastest way to receive your tax refund is to file your taxes electronically. If you file your tax returns electronically using e-file, you will likely receive your tax refund within 21 days. However, if you file your taxes by mail, it can take about six weeks to receive your tax refund. Filing your taxes electronically will also help protect you from tax fraud since you aren’t sending sensitive information through the mail.

If you need assistance filing your taxes, and meet the qualifications, you can get free tax preparation assistance from IRS-certified volunteers at a Volunteer Income Tax Assistance (VITA) or a Tax Counseling for the Elderly (TCE) location. The IRS locator tool will help you find a VITA site near you.

Learn more about filing your tax returns.

3. Use direct deposit

Receiving your tax return as a direct deposit is faster than getting a paper check in the mail, and it ensures that the money is saved safely and automatically.

4. Deposit some, or all, of your refund into your savings account

The IRS allows you to deposit your refund into up to three different accounts. You can automatically deposit portions of your tax refund into checking accounts, savings accounts, retirement accounts, mutual funds, or U.S. Savings Bonds. If you are filing electronically you can even purchase a savings bond while you are filing your tax return.

Other special accounts where you can automatically save some or all of your refund include:

Check with the IRS for more information on direct deposit and splitting your refund.

Affordable ways to file your taxes

Before you have your refund, you need to file your taxes. Be mindful that unemployment benefits may be taxable.

See if you qualify for free tax filing

You can receive free tax preparation assistance at a Volunteer Income Tax Assistance (VITA) location if you meet any of the following criteria:

  • You have an income of $56,000 or less
  • You are 60 years old or older
  • You have a disability
  • You speak limited English

If your income is $69,000 or less, you can use most major tax preparation software to file your taxes for free through the IRS Free File Alliance.

Members of the U.S. Armed Forces and their families can use the free online tax prep and e-filing program MilTax.

If you don’t qualify for free filing assistance

If your income is more than $69,000, you can still download free tax filing forms from the IRS.

While paying someone to file your taxes for you is convenient, there are plenty of affordable tax preparation software products that can walk you through the process of filing your taxes. Consider using one of these if you are uncomfortable filling out the forms on your own, but don’t want to pay a tax preparer to do it for you.

Protect yourself from tax fraud

Scammers like to take advantage of tax time to go after unsuspecting Americans. Follow these tips to protect yourself from tax fraud.

Be aware of scam phone calls. The IRS will never:

  • Call or email you to ask for personal information.
  • Demand immediate payment without first sending you a bill in the mail and giving you an opportunity to question or appeal the amount they say you owe.
  • Require you to use a specific payment method for taxes, like a prepaid debit card.
  • Ask for credit card information over the phone.
  • Threaten to have you arrested for not paying.

If any of these things happen to you, report it to the Treasury Inspector General for Tax Administration (TIGTA) at 1.800.366.4484 or at treasury.gov/tigta.

File electronically and request that your refund be deposited directly into your account.

Use ID theft prevention measures. Don’t carry your social security card with you and don’t give it out just because a business or professional asks for it. Also, don’t carry your Medicare card unless you’re going to a doctor for the first time.

Check your credit report. You can review your credit report for free every 12 months at AnnualCreditReport.com, or by calling 877-322-8228.

If you suspect you’ve been a victim of identity theft and it involves your income tax return, the IRS has more information and help on suspected fraud.

Read More