When you take a closer look at their budgets, you'll find that their new home and luxury cars eat up so much of their incomes that they can't afford other essentials.
When this happens, it's time for them to consider their ways. A mortgage should only take up 28-36 percent of your income, and the car payment for two cars shouldn't exceed 15-20 percent.
When your money seems to evaporate into thin air, you've probably gotten over into hyper-consumption, which is simply spending money as fast as you earn it. In other words, you have more "output" than income.
People hyper-consume for a variety of reasons: they are trying to keep up with the Joneses, or they are compulsive or comfort shoppers.
When you see your co-worker with a new outfit, a new car or a piece of jewelry and you feel compelled to buy something similar or better, then you are shopping to impress others. If you buy "things" thinking that you will feel better afterward, you're a comfort shopper.
A compulsive shopper is someone whose philosophy is "shop until you drop," without thinking about how the bills will get paid. While these types of shopping may give you some temporary satisfaction, you will never reach the financial prosperity you are trying to attain.
Hyper-consumption doesn't allow you to see where you are financially; therefore, you can't move forward in your finances. You will never be able to save any money if you spend it as fast as you make it. Neither can you be a blessing to anyone else if you live from paycheck to paycheck.
If God instructs you to invest in real estate, stocks or mutual funds so that you can continue to increase and amass wealth, you won't have the extra income to follow His instructions.
Faithful In The Least
You must learn how to manage the money you have if you want to get your finances under control and begin to walk in the prosperity that has God promised His children. Jesus said in Luke 16:10, "He that is faithful in that which is least is faithful also in much...."
You have to prove yourself faithful with present income before God can give you a greater one. You see, if God were to bless someone with sudden wealth now, he or she may quickly squander it and end up in a worse situation.
It's the faithful man who abounds in God's blessing (Prov. 28:20); therefore, you must have a starting point from which to work if you ever plan to be financially free.
Take Care Of The Natural
God has a part to play and you have a part to play in the manifestation of every promise in the Bible. With regard to financial prosperity, your part is to get organized and set up a budget. Your budget will be the blueprint necessary to help you reach financial prosperity.
When you know what your current financial status is, you will easily be able to track where your money is going.
To create your budget, gather all of your essentials:
- Pay stubs to determine monthly gross income
- Housing expenses: mortgage/rental, utility bills, cable TV, Internet and maintenance/repairs
- Transportation expenses: car notes and/or bus/train passes, insurance, gas, Ad Valorem taxes, tag fees and maintenance/repair costs
- Tax bills/statements
- Insurance information: medical, dental, life, supplemental, etc.
- Food expenses
- Entertainment: vacation, babysitter, dining out
- Medical expenses: doctors, dentists, prescriptions, glasses/contacts and contact solution
- School/child care information: daycare, before and after school fees, tuition, supplies
- Debts: credit cards/loans
- Pet care: food, veterinarian fees, grooming, vaccinations/medications, etc.
- Miscellaneous: dry cleaning, beauty/barber, cosmetics, toiletry items, subscriptions, gifts, lunch money, etc.
- Bank Fees: monthly fees, ATM/debit card transaction fees
- Savings account information/balances
- Investments: 401(k), 403(b), 501k, stocks, mutual funds, CDs
- Use computer software such as Quicken or Excel to enter all of the above information. If you don't have access to a computer, create a budget worksheet by setting up categories that reflect the income and expenses you've gathered.
- Calculate your monthly gross pay (before taxes) and enter it at the top of the sheet.
- Under gross income, list your tithes, offerings, payroll taxes (found on paycheck stubs) and other deductions for that month. Subtract them from your gross income to obtain your spendable income.
- Add all of your other expense categories to get your total expenses.
- Subtract your total expenses from your net spendable income. This amount will indicate whether or not you are living within your means.
If you see that you are spending more than you bring in, don't get discouraged. Here are some tips to help you get back on track:
- Take responsibility for where you are right now, then make a quality decision to change your spending habits.
- Stop using credit cards, or only use them if you can pay the balances off at the end of the month.
- Cut up credit cards and pay off balances.
- Keep a detailed spending log of every purchase you make.
- Distinguish between needs and wants. This will help you locate and eliminate wasteful spending. Do you really need those magazine subscriptions, phone features or premium movie channels?
- Take your lunch to work instead of eating out. $5 a day on a lunch equals $25 per week, $100 a month and $1200 a year! Use that money to pay off a credit card or pay down your mortgage principle.
- Cut out unnecessary junk food purchases. Buy in bulk to save money on groceries.
- Avoid the mall and all impulse purchases. Shop during sales and buy clothes "off" season, when prices are at their lowest.
Make a quality decision to get organized and live within your means. When God finds you faithful, you will suddenly find yourself abounding in His blessings!
Creflo Dollar Ministries
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