Financial Advice For Young Families, Moving Toward Financial Freedom
By David Reynolds
I Pick Up Pennies!
“He becometh poor that dealeth with a slack hand but the hand of the diligent maketh rich” Proverbs 10•4
Don’t buy food on your credit card. On larger items save up your money until you can afford it.
We are on a journey toward financial freedom and wise spending is a good share of this journey. Son, you must realize that money is an exchange for your time and labor. Money represents part of your life here on this earth. It represents the breath, strength and ability that God has given to you. Treat it with respect. Know that we are just conduits for the monetary blessings that God allows to come our way. We get to be able to give. As conduits we can give out only what comes in–no more. We can spend only what is given to us–no more. Son, we spend hard-earned money, many times, for things we really do not need.
When I see a penny on the parking lot I bend and pick it up—what about you? I walk across the street from Starbucks and buy a cup of senior MacDonald’s coffee for sixty cents [Rated ‘better tasting, by Consumer Report].
Brother Edday, Pastor of Hood River church, in a great Bible study entitled “Money Smart”, said that most families have problems handling money because they do not watch the small purchases. He used the scripture, “… the little foxes that spoil the vines… “. The following is his advice and examples:
1. Save and pay cash for things.
“Save $5000 and buy a good dependable used car and then put just liability insurance on it. You are saving the large price of a new car along with the interest and higher insurance. You could be saving as much as $550 per month. Invest this saving at $10% interest for just 6 years—then leave that money alone until age 60 you will have 2.5 million in the bank”. This is the power of compound interest—this is how the banks make big money on your money.
2. Watch the Starbucks coffee.
“There are 250 working days in the year, if you stop on the way to work every day and get a plain cup of coffee at $1.64 for 12 ounces you will spend $410 a year. Buy a Grande Cannel Macchiato or a Grande Frap-Puccini at $3.50 you will spend $875 per year. You can make the same strait coffee at home for $17.50 a year or put the extra stuff in it yourself for about $50.00.
Don’t complain too much about $4.30 a gallon for gas when you pay $37 a gallon for ‘fru fru’ coffee or $17 a gallon for straight coffee–or $6 a gallon for the cheapest bottled water you can find.”
3. Eat at home.
It is at least twice as expensive to eat out as to eat at home. If your average cost of a meal at MacDonald is $4.76 and you eat there 4 times a week that is $913 a year.
4. Buy used cars three years old.
If you keep your new car for at least ten years—or if you buy used and trade not more than every 4 years –you can retire 5 years sooner.
Watch the pennies. It is the small foxes that spoil the vine.
Son, let me further give to you what I have learned:
1. Resist Impulse Buying
When you or your wife go to the grocery store always go with a prepared list. Never go when you are hungry. For years
I worked in a grocery store and know that the store puts on the end displays high profit items–items that you do not need but which catch your eye and you buy on impulse. Be very careful at the check -out counter, for they place candy to catch the eye of the children and magazines to catch you.
Never buy over the phone. If you have not thought about the need of an item -you don’t need it. When buying a car or an appliance never buy the same day the salesman talks to you. You need to visit other stores and give thought to the value, the price, and whether you really need it. You will be surprised at the number of times you decide to live with what you already have.
2. Buy 2″ Hand
Look for good used items–and then only when you need them. I just bought a used Lincoln Town Car six years old with only 64,000 miles on it–with new tires! It looked new and smelt new. I paid one-third of what was paid new. Buy at Goodwill, Salvation Army, and at garage sales. Look for quality. Don’t bring home junk.
3. Look for Sales
I raise my beef–but I can buy it cheaper in the stores on sale. Buy the cuts that are advertised specials. Clip and use store coupons.
4. Buy with Cash
Don’t buy food on your credit card. On larger items save up your money until you can afford it. Most of the time you will decide that it would be wiser to spend it for another need.
5. Buy items that will last
Don’t have a throw-a-way mentality. Remember cars depreciate –but property usually grows in value. “Who can find a virtuous woman? For her price is far above rubies…. She seeketh wool and flax, and worketh willingly with her hands. She is like the merchant ships; bringing her food from afar”. Proverbs 31:10-14 AA’
From, “Apostolic Accent”/Summer 2008/Page 10, by David Reynolds
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