Simple principles of savings and budgeting.

1. 8.2 Principles of Savings
Viv Grigg, Feb 2017
Using some slides from emurfield on slideshare

2. Review of Management
Principles
1. Increase your Income
2. Break the power of the loan
sharks
3. Control your expenses
 3.1 Keep a daily record of expenses.
 3.2 Prepare a weekly or monthly budget.
Use this to work out what you need to cut.
 3.3 Record weekly income and expenses
and summarize monthly.

3. Can You Believe?
Almost 60% of teens follow
a 50/50 plan: half of
any money received is
spent, and the other half
goes into savings.

4. Review: What Is A Budget?
A budget is a plan for managing money during a
given period of time.
Income: Any money coming in
>What’s the difference between gross income
and net income?

5. What Is A Budget?
Expenses: The money you spend on your needs and wants;
Money going out
>What’s the difference between fixed expenses and
variable expenses?
-Fixed expenses have set dollar amounts and are the
exact amount every time (Ex: Rent or car payment)
-Variable expenses can change, which means you have more
control over them
(Ex: What you spend on car gas or entertainment)

6. Benefits of a Budget
 Will help you live within your means
 Can help you save toward important goals
 Forces you to evaluate and modify your spending
patterns

7. Personal Budget
Two Main Parts:
1. Income
2. Expenses
One must balance the two
in order to avoid debt.

8. Review: Building Your Own Budget
Step 1: Consider Financial Goals
 Write down long-term and short-term goals
Step 2: Estimate Income
 Think about net income as well as other sources of
income
Step 3: Estimate Expenses
 Look at previous billing statements
 Take note of fixed and variable expenses
Step 4: Develop a Trial Budget
 Fill out what you expect to earn and spend, then record
actual income and expenses

9. Biblical Basis for Savings
 There is a time to save and a time to spend (Ecc 3:1-9).
 We all save, even if we only save our salary for a few
days. We are to follow the example of the ant (Prov
6:8).
 During a time of abundance, we should put aside
money for the lean years. The wise person saves for
the future, but the foolish spends whatever he gets…
(Prov 21:20).

10. Life Stages and Savings
 As incomes increase, consumption tends to increase
proportionally. keep a shrewd eye on how to live simply,
and maximize savings, and giving at every stage of life.
 funding of tertiary education
 cost of a wedding
 buy a house
 own your own business
 Kids college
 Retirement

11. Who Provides?
 The godly man thus provides for his retirement, for his widow and
leaves an inheritance for his children (Prov 13:22).
 Churches need to provide
 systems of support in financial decisions like these.
 in budgeting processes.
 The modern state needs to provide
 stable infrastructure to sustain employment,
 accessible house prices that enable home ownership for all
 education that does not end up with a generation in deep debt.
 A safety net for the poor and elderly

12. Savings and Blessing
 Remember, one can follow all practical
steps but unless the blessing of the Lord
is on our finances, we will struggle. Make
sure daily you are meeting him, and there
is no sin barrier between you and him.
Then your prayers will be answered as
you seek his will and his provision (John
15:7).

13. Steps in the Practice of Savings
 1. At all stages, put
aside enough for an
emergency fund first.
When you have
little, this may seem a
strange practice.
 1 week initially
 Build to 3 months
My grandma used to use
a teapot.

14. Capital Expenses
 Save for foreseeable or
major capital expenses
 a piece of furniture, vehicle,
education, Christmas, your
daughter’s wedding, a car
repair (it will come).
 Do not plan to buy on credit,
but when you have the money
saved up.

15. Save for Milestones
 College education
 Marriage
 Home
 Kids College
 Retirement

16. Give: Savings for heaven
 Tithing principle: There is a rule of thumb - save 10%, Give
10%. Andrew Liuson 10:20:70 principle. Give10%, save20%,
spend70%
 This leads to the Lord’s blessing. Abraham, as he gave to
Melchizadech, the priest (Genesis 14:18-20).
 Part of tithing for the poor. A large part of tithing in the
scriptures is to the poor. Some estimate it as about 30%. In Acts 2
and 4, it was given to the apostles to distribute to the poor. leave
the edges of our crops.
 Part of tithing for the local church The priests also were to
receive offerings and Paul tells us that “a labourer is worthy of his
hire”, so giving a % to your church is also important.
 part for apostolic advance in missions. Many of us use
some of that to support those on the forefront of the church
globally.

17. Freedom in Giving
 Resist the pressures of pastors
 who put bondage on their flock by demanding that
tithes be paid
 that gifts to the poor or to missions are above and
beyond those tithes.
 These are extra-biblical teaching.
 Paul was very gentle with people, encouraging
them to give, but teaching that it must be done
freely out of a generous heart (2 Cor 8 and 9).

18. Savings and Budgets
Step 5 in Budgetting: Plan for Savings
 Aim to save anywhere from 3 to 9 months’
income to cover emergencies
 Further savings should be invested appropriately
 Add these to your budget
Step 6: Plan for Giving
 This goes at the top, take 10% of your income.
Assign it to missions, the poor, the local church

19. The Envelope System
1. Label an envelope for
each spending category
(savings, food, gas,
entertainment)
2. Record the planned
amount on the
appropriate envelope

20. The Envelope System
3. As you receive money, place
the planned amount in each
envelope
4. When you need to spend
money, take cash out of the
appropriate envelope
5. When an envelope is out of
cash, you’re done spending
for that category!

21. 5 Future Certainties for which
you need to SAVE Your Money!
1. Emergencies
2. Expensive Purchases
3. College for Kids
4. Retirement
5. Special Goals

22. One Future (Un)Certainties for which you
need to (not) SAVE Your Money!
1. Eternal Life
Put your money on ahead of you as
you give to the Kingdom. It’s the
best savings deal you can get
1. Don’t save to amass a
fortune
Do not store up for yourselves
treasures on earth… (Matt 6:19-
21)

23. Resources
 In the Philippines
 Liuson, Andrew. (2015) Free Lifestyle: Ten Principles
that Can Revolutionize Your Life. Manila: Cross Over
Books.
 In the US
 Ramsey, Dave. Financial Peace University
 Use www. mint.com as a way to manage your
budgeting online.
 In New Zealand
 Liberty Trust. www.libertytrust.org.nz
 Christians Against Poverty. www.capnz.org