Why Money Matters
Always we Ask: Why does Money Matter?
Once Upon a time, Dave Ramsey wrote a book: the Total Money Makeover. In it, he gives us a very down to earth and sometimes even shockingly direct look at the ways we spend our money, how to save it, and the myths that we believe by Society at Large. Debt. It’s an embarrassing four-letter word. Many journey through high school graduation, immediately jump into the Student Loan Pool, swim through the waves of credit cards and get caught in the undertow of financial crisis. Suddenly found on a sinking ship, and then left stranded on an island, surrounded by the sea of debt, wondering how and when we got there.
Mr. Ramsey gives us baby steps along the way to help us achieve financial freedom, and uses examples of real-life people and couples who have succeeded in completing their goals of financial freedom. He doesn’t use difficult language or hard to understand terminology.
Where do We Learn About Money?
Why money matters: For most of us, our parents taught us how to handle money. This means, in order for us to succeed with money, not only did our parents have to do well with money themselves; they had to be good teachers and examples. Mine were not necessarily good teachers, and I learned much from this book.
“Too many of our youth get into financial difficulty because they never learned proper principles of financial common sense at home. Teach your children while they are young. Teach them that they cannot have something merely because they want it. Teach them the principles of hard work, frugality, and saving.” Joseph B. Wirthlin
Marvin J. Ashton said, “One of the greatest favors parents can do for their children is to teach them to work. Much has been said over the years about children and monthly allowances, and opinions and recommendations vary greatly.”
Since reading this, we have *set up a regular allowance schedule for our children. We no longer pay for things we have called “non-essential”. This has already proven to be a great learning experience. I wish we had done this sooner. Reading this book has inspired me to do it, and make sure I continue to do it. Budgeting is not inherit, it is taught.
Emergency Fund
Mr. Ramsey’s first baby step is to *set up an emergency fund; We are asked to save $1,000 for an emergency fund and not touch it!
Pay Off your Debts in Order from Least to Greatest Using the “Debt Snowball”
Why money matters: In the publication, One for the Money, a very similar format was introduced to pay off debt. This is called the Debt Elimination Calendar. This was in sync with the Debt Snowball from Ramsey, which helps to re-assure me that this is the book we should be using to help us pay off our debt; the way the Lord wants us to. Joseph F. Smith advised the Saints to “Get out of debt and keep out of debt, and then you will be financially as well as spiritually free”. The Debt Snowball form was easy to complete, and I am thankful my ignorance is gone for how I once viewed our financial accounts.
Finish an Emergency Fund of 3–6 Months of Expenses (usually about $5,000 to $10,000)
This was in synchronized advice with One for the Money. We have been admonished to have an emergency fund, and to make wise purchases. N. Eldon Tanner (1898–1982), observed: “There is no way that you can ever earn more than you can spend. I am convinced that it is not the amount of money an individual earns that brings peace of mind as much as it is having control of his money. … Whether early in life or late, we must all eventually learn to discipline ourselves, our appetites, and our economic desires.”
Read that again, and tell me that it didn’t hit a nerve with you. It did with me. It is the control over my finances that I want and am striving to reach. After we save our initial emergency fund of $1k, Ramsey says to focus on getting a more substantial emergency fund going. Are we aware, of how serious a problem it is when people have no savings? Then they fall upon hard times. Turning to credit cards just makes it worse.
Fund your Kids’ College Education
“Use your credit wisely, if it is necessary to use it at all. For example, a reasonable debt may be justified for the acquisition of a home or education. . . “Complete as much formal, full-time education as possible, including trade schools and apprentice programs. This is money well invested. Based on potential lifetime earnings, the hours spent in furthering your education will be very valuable indeed.” Marvin J. Ashton.
Why money matters: I have kids in college, and it is very expensive. All of my older kids are getting a copy of this book. Our oldest daughter has graduated from BYU Idaho, with a Degree in Elementary Teaching. She has gone out into the world to teach elementary school children. Now she is making her own money. While single, she had plenty of money to play and do fun things with her friends; go shopping and have a grand adventure with her single life. Then she married.
Oh the Lessons Learned in Married Life!
Her husband is a full time student and she is the sole provider for now. It has been hard to go from “riches to rags‘, and very humbling. My responsibility as a mother who teaches her children about finance is very important. I share with her now the sacrifice involved while keeping her in school. Not to give her guilt, but to make her aware. We want her siblings to see too, and not want to squander dad’s hard earned money on frivolous things. Each child is different in how they handle money, and we did not always teach them how to do this on their own. There are regrets in my life for not letting them use their own money more.
Don’t let kids get caught in the lies of credit card companies, or myths of society.
Why Pay for their Schooling?
If you can pay for your kids college expenses, they wont have to start life with debt. However, if they drop out of school, the gravy train stops. Ramsey goes so far to say that if they drop out, then they are now in debt to pay you back what you put out for their schooling. A contract can be drawn up as freshmen, so there are no surprises. We had to stop funding a child’s education. Side tracked by fun and freedom; class took a back seat. We gave her another semester and it wasn’t much better. Now she is earning a living doing other things, and learning life lessons. On the other hand, our oldest son took some time off from school and just recently went back.
We are all on our own time schedule for education, and that is okay.
Build Wealth and Give
“Save all the money that ye can … that in time ye may be enabled to purchase land for an inheritance” D&C 48:4.
In this book, Mr. Ramsey states how many people with big hearts could not afford to more than be sympathetic to the needs of others, when drowning in debt themselves. But what is so refreshing, is that he says that it is the happiest thing to do to give it away and to be able to help someone in need. This is in direct concordance with the gospel. We are asked to bless others when we are blessed. He also quotes many scriptures from the Bible about debt, which is refreshing.
Put God First
“Financially, we can put God first by paying our tithes and offerings before all other expenditures. We also put God first by seeking His will and guidance in all of our money matters. In response to putting Him first, God promises to open “the windows of heaven” and pour out both temporal and spiritual blessings, blessings greater than we have the capacity to receive.” Jan D. Andersen.
Like many others, I’m humbled by how blessed we are, and am looking to bless others through my time, talents and opportunities. More awareness of how hard it is on many families who truly struggle to survive has come to me. My goal is to help more where I can, and spend more wisely. There is much more I could tell you about this book. Just read it! It is a perfect investment, or borrow it from a friend. If you are swimming in debt, you will not regret it.
Sharing What we Have Gains Happiness
Benjamin Franklin said, “Money never made a man happy yet, nor will it. There is nothing in its nature to produce happiness. The more a man has, the more he wants. Instead of filling a vacuum, it makes one.”
What is the happiest thing to do to with wealth? Give it away. We can bless others when we are blessed.
This is charity. Charity is the pure love of Christ.
“You can give without loving, but you can never love without giving.” —Robert Louis Stevenson.
More Later,
~Cynthia
References
Ramsey, Dave The Total Money Makeover 2007 Nashville
Andersen Jan D. Ensign Aug. 2006 … By. Assistant Professor of Family and Consumer Sciences, California State University, Sacramento. Financial Freedom on Any Income
www.lds.org/ensign/2006/08/financial-freedom-on-any-income?lang=eng
Ashton, Marvin J. One for the Money Elder A Guide to Personal Finance Pages 3,9
“Constancy amid Change,” Ensign, Nov. 1979, 81
Richards, Franklin D. Personal and Family Financial Preparedness Personal and Family Financial Preparedness April 1979 General Conference
http://www.lds.org/general-conference/1979/04/personal-and-family-financial-preparedness?lang=eng
Smith, Joseph Fielding -President Joseph F. Smith In Conference Report, Oct. 1903, p. 5 Teachings of Presidents of the Church:…
Wirthlin, Joseph B. Earthly Debts, Heavenly Debts –
http://www.lds.org/general-conference/2004/04/earthly-debts-heavenly-debts?lang=eng
You May Also Like
