Proverbs 21:5 says “Good planning and hard work lead to prosperity, but hasty shortcuts lead to poverty.”
Solomon, one of the wisest and wealthiest men to ever have lived, says here that financial planning = prosperity. Not planning = poverty. If Solomon lived today he might say: Financial planning helps you to stay in the black. If you don’t plan you will surely find yourself in the red.
What Solomon called planning, we (today) call budgeting. I know some of you think budget is a curse word – I assure you it’s not. A budget by definition is planned spending. And the purpose of a budget is to tell your money where to go so you don’t have to wonder where it went. Some say “money talks”. No it doesn’t! It just walks away quietly. But a budget will prevent this from happening.
Now from the Bible we learn three areas we need to budget for.
- We need to budget our giving: When we get paid we need to budget the first 10% for God. The Bible calls this the tithe and we’ll talk about it more later in the message.
- We need to budget our savings: After you pay God, you need to pay yourself. How much? Experts in the field recommend 10%. So you give God 10%, then you save 10%.
- We need to budget our spending: After you pay God and pay yourself, you use the rest wisely – being a good steward of however much God has entrusted you with.
Solomon says: If you plan (or budget) your money this way, it will lead to prosperity, not poverty. If you don’t have a budget, you’re either already in debt or are headed there. Here’s why: Our yearnings will always exceed our earnings. And without a budget we’ll say “yes” too often, which in time leads to debt. The value of a budget is that it informs us when to say “yes” and when to say “no”. For example…
- When considering how much to spend when purchasing a home you ask yourself: After budgeting 10% for God and 10% for savings, can I afford this home? Your budget will tell you “yes” or “no”.
- Or when considering how much to spend when purchasing a car you ask yourself: After budgeting 10% for God and 10% for savings, can I afford this car? Your budget will tell you “yes” or “no”.
- You might want the latest and greatest iPhone 5s for $400, but your budget might inform you that you need to get the iPhone 5c, which only costs $50 at Target right now.
- You might see something at the mall that you want and be tempted to make an impulse purchase – but budgeting will help curb impulse purchases. Impulse buying is based on emotion, not what you have in the bank. A budget protects us from this. When your emotions say “I want it and have to have it right now!” your budget can calmly state “No. You can’t afford it. Don’t buy it.”
Now even though we all ought to be using a budget, most of us don’t because we don’t like anyone or anything telling us “no”. We live in a culture that says “You deserve it – even if you can’t afford it.” And it’s because of this unbiblical mentality that as individuals and a nation we are steeped in debt. But each of us has to decide: Will we live by what culture says or by what God says? God tells us, through Solomon, that good planning (budgeting) leads to prosperity, while failing to budget leads to debt.