FIXED INCOME

It is an interesting comment when we hear our seniors say that they are living on fixed incomes. What they mean by this is that they are dependent upon government welfare programs and have trusted the government to meet their needs in their golden years. They receive a predictable fixed amount each month and each year, they may get a very modest increase which will probably not keep up with the rate of inflation.

What these seniors have not considered is that we are all on a fixed income. When they tell me they are on a fixed income, I respond by saying, "So am I." This takes them aback. Each of us are only able to generate so much income, at a given time. Take for instance a professional athlete. He agrees to play his given sport for so much a year. He may make more money in reaching certain levels but his salary is going to be a determined amount.

To increase our fixed income, to another fixed level, we must increase our value to the market. There are only so many athletes and other entertainers that are able to do what they do. They earn more than the rest because they are in an elite class. Still, they can only earn so much. Built into this world is the concept of limits. We are all limited to one extent or another. We can exceed our limitations to a degree but there comes a point when we can no longer surpass those limits. At that point, things have become fixed.

Knowing this, it behooves us to learn to live in a world of limits, especially in the area of finance. To effectively do this, one must separate needs from wants. Needs come first in priority. Wants come out of discretionary income i.e. what is left over after priority bills have been paid. This is unallocated money. Living in a world of limits means establishing a budget. Budgets make us aware of just how fixed our incomes are. Once we see where our money is going, then we can begin to make necessary adjustments to get our spending under control.

Besides the idea of living on a fixed income , we must come to the realization that we must self govern. It takes self discipline to be on a budget. It takes wisdom. The ant gives us the wisdom of having a budget in Proverbs 6:6-8, "Go to the ant, thou sluggard; consider her ways, and be wise: 7Which having no guide, overseer, or ruler, 8Provideth her meat in the summer, and gathereth her food in the harvest." The ant instinctively knows that she must be productive and then budget her produce to get through the year. This is a good example of self government.

A principle that is universally true is, if you do not govern yourself, someone else must do it. This is why it is imperative that we take the proverbial bulls by the horns and take responsibility for ourselves and our actions. Budgeting is taking responsibility. Planning is what budgeting amounts to. It is anticipatory of the future. It is living in accord with the laws established in the universe. Budgeting has a harmonious effect.