INVESTMENT ADVICE FROM A THEOLOGICAL STANDPOINT

After reading an economic report, it dawned on me that no matter how much one may use statistics, they are essentially useless. These statistics ignore the important issues of life. In other words, so what if someone lives in a mansion and someone else lives in a modest dwelling? Both are headed to the same place the grave. This is not to ignore the fact of abilities. Each of us must develop our talents to their logical conclusion. A place to live in is just that a place to live in.

The key to living the good life is not to spend more than one earns. This takes what most people lack, self discipline. Most people refuse to do this. This means that someone else must do this for them. This is why credit cards have credit limits. Exceed the credit limit and theses companies who issue the cards cut you off. Like a good bartender who realizes that you have had too much to drink, cut them off before they have gone too far. Most people desire to live in an utopian world, in which, they do not have to pay back their bills. They are wicked, by definition. This is the message of Psalm 37:21, "The wicked borroweth, and payeth not again: but the righteous showeth mercy, and giveth." We see that numbers really having nothing to do with anything. It is an attitude of the heart. Wicked people borrow on credit cards but have no intention of repaying their just debts. This is because they are not justified.

Most investment advisors do not realize that all of life is theologically based. They like so many others are simply fools. They do not and cannot advance good monetary policies. They may rail against the policies of the Federal Reserve but they do not claim that God created the world and therefore, we must conform ourselves to God’s law or fail miserably. They do conform to the extent that allows them to function. However, they do not want the root, just the fruit.

The numbers that economists and financial advisors use are astronomical. They are basically beyond the level or of our comprehension. Besides all of that, they are not realistic to each and everyone’s well being. In other words, each of us must be guided by self-interest to a certain extent but also the well being of our neighbor. Paul expressed this truth in Philippians 2:3-4, "Let nothing be done through strife or vainglory; but in lowliness of mind let each esteem other better than themselves. 4Look not every man on his own things, but every man also on the things of others." Yes, we are motivated by self-interest. However, this must not be our driving force. We must realize that we live in a world with other people. We must, first and foremost, seek to advance their cause, then we can see our ideal moving forward.

The law of God is very clear in this regard in Leviticus 19:18, "Thou shalt not avenge, nor bear any grudge against the children of thy people, but thou shalt love thy neighbour as thyself: I am the LORD." This is the key to long term success in any and every endeavor that we find ourselves. Loving our neighbor does not mean that we tolerate everything that our neighbor is involved in. It does mean that we treat each and every individual that we have contact with the same treatment that God’s law places upon us for them. This means that our prosperity depends upon others more than ourselves. This is, of course, contrary to popular wisdom.
Thus, it should be apparent that our best investment is into what is known in economic terms as "human capital." Capital is comprised of land, labor, and capital. The most important part of this equation is labor. The other components are inanimate objects that cannot think. They are the tools of production that allow us to increase our wealth. It should be our intent to always be increasing our net worth. Productivity is a Godly pursuit.

Wealth creation should be something that we should actively be seeking. It benefits everyone and is a component of loving our neighbor as ourselves. In other words, it is a win, win proposition. They wealthier a society becomes, the wealthier each and every member also becomes. Wealth with godliness is a good thing. Paul expressed it this way in 1 Timothy 6:6, "But godliness with contentment is great gain." We need to learn to be content with our situation. God works through His divine providence. In other words, He knows what is best for each and everyone of us. We must realize that each and everyone of us have limitations. We are not God, in other words.

Each of has been given talents and abilities. We must seek to expand them to their uttermost. This means that we must either be generalists or specialists. Some people are more versatile than others. They can excel at whatever they do. Most, however, can perform certain tasks, if given the right instruction. In other words, the vast majority can only perform within given parameters. There is a tremendous need for these people. They perform the menial but essential tasks within each and every organization. Their pay scale reflects their given skill level.
The market system is not a respecter of persons. Only the successful achieve above market rate of return. The market system weeds out the losers from the winners. The market system sees everything in either black or red. There is no neutrality in the market system. Most employees have no idea what a profit and loss statement is. They are not trained accountants. The profession of accounting is based upon balance. This is what is known as double entry accounting. In this world, everything balances out.

The law of the market is the law of supply and demand. If the demand for your product exceeds your expenses for supplying the product, then you have a residual known as profit. You are ahead of the game. You have achieved a level of efficiency that is profitable or productive. This is a good situation to be in. The hard work is now behind you because you have achieved an economy of scale that allows you to compete in the market. In other words, you have moved past the critical mass state and now are able to build upon your past accomplishments. The key is to keeping moving forward. Someone who is serious about being successful in their endeavors will not rest on their laurels.

The time to write your memoirs is when you are to old to do anything else. Success is based upon productivity and upon nothing else. Only the productive survive long term in the market system. The rest only eke out a minuscule existence. In other words, excellence is not a watchword for the vast majority of people. They are content with mediocrity. Their names are legion. These are not the movers and shakers within the market. Few and far between are the individuals who impact their chosen profession.

Who do I think will be successful in their chose vocation? Simply, those who understand that the world they live in is guided by law. That is law as an absolute, not as they choose, but that which is already derived from above. They may not know it intellectually, but intuitively, they understand it. The concept of transcendence is not something someone in business would present in his presentation, but it exists as an implication. Most people do not think with theological categories, but they display them in everything they do whether spoken or not. It is never a question of theology or no theology, but which?

The market governs itself upon the basis of law. No employer tolerates lying and cheating. On what basis does he do this? He has to believe in some things are right and some are wrong. Even a sinner does not want someone to lie to him. It is okay if he lies about everything, but just do not do it to him. He will surely resent it. It is amazing what some people will allow with themselves but will not extend the same benefit to others.

One thinks about competence when one wants to hire any individual. Most employers fail at this point. Most employers are too cost conscious. They do not realize that they end up spending more in the long run by their poor personnel choices than by investing a little more in a quality choice. In other words, you get what you pay for. This is the law of likes begetting likes. Mediocrity begets the same. Therefore, the Frugal Accountant is success oriented because he is productive oriented. Being mediocre does not enter into the equation.

BUSINESS ETHICS

Introduction

If there is anything that we need in our day, it is practicality. Each and every day I am amazed more and more how much people believe in total nonsense. We are told by scientists that someday that they will find a cure for every known disease. They promise much and end up delivering nothing. People still die. They want more money for research. They always seem to be right on the edge of some monumental breakthrough and then it still remains out of their reach. Even with all of our modern medical technology, it is still wiser to prevent disease and illness before it begins using common sense methods.

As Gary North wrote in one of his Reality Check Newsletters, prevention does not sell. People would rather go through the hard way and pay out money rather than doing something to prevent it in the first place. Foresight is much in demand, as long as it does not require effort on the individual’s part. They want something for nothing, in other words. They want good health without exercising. They want to lose weight and eat every donut in sight. They simply refuse to discipline themselves and then blame on their heredity. Heredity is the cop out that I am not responsible for my actions. The new one is my thyroid. The bottom line is the Little Debbies soon make Big Debbies, like it or not.

Fantasy World

Most people live in a fantasy world. They see the world, not in terms of reality, but what they deem to be reality. They think that they can smoke and not get heart disease and cancer and if they do, they can always sue the manufacturer and claim that they did not know that cigarette smoking is harmful to their health. Or that overeating will not cause health problems. They usually say that they do not eat all that much and when you seem them eat, they act like this may be their last supper.

What does all this have to do with finance and economics? Everything! We have to realize that all men are created in God’s image, even though that image has been marred by sin. In other words, all men are religious and they will act in accordance with their religious presuppositions. There I said it. The financial world is controlled by religion, pure and simple. I know that this is not what the atheist wanted to hear. I am not writing to please atheists.

Pleasing All Men

My latest pet peeve is companies who try to accommodate every type of buyer. Companies have grown so large that they try to cater to every taste, no matter how low that may take them. An example is Barnes & Noble. I enjoy a cup or two of coffee a day. My favorite is Starbuck’s. The Barnes & Noble Bookstore in Johnson City has a Starbucks. Once a month, my daughter and I go and get us some coffee. The last time, I was in there I noticed a display rack of magazines under the title Gay Pride. In this same store, they sell some Christian books and other professing ones and Bibles. Obviously, the Bible and sodomites do not mix. They need to make up their mind what they are going to be. They cannot have Christians and homosexuals mixing. It will not work. (By even saying this I have limited my reachable market but some things in life are more important than money).

My goal is not to be the biggest, and richest. To do so, would mean you have to compromise somewhere along the line. It is better to make a living and keep your integrity. Discrimination is an inescapable concept. Our government and especially our judiciary system discriminates against Christians all the time. Christians only rights in the public square is to keep their mouths shut and pay their taxes to fund the religion of humanism. They do not want our input. They think that they can run God’s world without God. Of course, they are miserable failures, but don’t tell them, you will hurt their feelings.

Business Ethics

All of business life is based on ethics. To be successful in the long term, your ethics are going to have to be without spot or wrinkle. Short term gain will come back to haunt you every time. There are plenty businesses that started out well only to fall by the wayside because they compromised their essential values that made them successful in the first place. We live in God’s world and He has established the parameters by which success can and will be measured. Someone may make over $100,000 a year and be considered to be successful by the world’s standards and his personal life be a complete disaster. Christians do not base their standards by the world, but by God’s.

Conclusion

Even at this, if a Christian will follow God’s covenant law, they can become wealthy beyond what they thought possible. This is because God’s law favors the righteous and not the unrighteous. Whether anyone believes this or not, God already has a reward and punishment system that is at work at all times. It is called His sanctions. This provides feedback for us to make necessary adjustments in what we are doing. His sanctions are either positive or negative. If we have a profit from our business, this is a positive sanction or blessing. If on the other hand, we have a loss, this is a negative sanction or cursing. It is going to be one or the other. In fact, these are inescapable concepts. Everyone is always trying to outsmart God. It never works. It is better simply to agree with Him.

FINANCIAL IGNORANCE

It is quite fascinating to read the financial messes that people get themselves into even when they are conscientious in trying to do the right things. One thing that is never taught in the public school system is basic finance. I never learned how to balance a checkbook in school. Finance is essential for our lives outside of school and yet its importance is not even registered in the curriculum of the government school system.

Most people do not understand how financial products work. They do not understand basic budgeting. They were never taught and then when they get into a financial bind, they expect the government to bail them out. Instead of learning basic finance, they go through life making the same mistakes and never correct them. This is the reason why cash advance and title loan businesses are thriving and opening up new stores.

The Frugal Accountant dislikes financial ignorance with a passion. The the purpose of these essays is to inform others about finance from a biblical perspective. Finance is not hard to understand. The basis of finance is the budget. The key to having a solid financial base is not to spend more than you earn. This means that you know how much you have coming in (revenues) and much is going out (expenditures). The net of the two (revenue - expenditures) is discretionary income. Discretionary income is available to be used for what an individual desires.

If you spend more than you earn, then you are forced to have to borrow money (go in debt) to make up the shortfall (difference). Most people do this by way of credit cards. When purchasing something on a credit card, it is considered an unsecured loan. The credit card company is requiring no collateral be put up to secure the loan. This arrangement is open ended. It cannot be amortized. The balance of your account is not fixed and therefore varies depending upon usage.

Since the credit card company is loaning you money without any collateral, they are going to charge you a higher interest rate than you would usually pay on a secured loan. It is imperative to know what the interest rate of your credit card is. The way that credit card interest is calculated is on a daily periodic rate. For instance, if the interest rate for a credit card is 18%, the daily periodic rate is calculated as follows, 18%/365 = .049315. To figure the interest rate of a $1,000 credit card balance will be as follows: $1,000 x .049315% x 31 (days in billing cycle) = $15.29. This means that what is owed to the credit card company is $1,015.29.

It is no mystery how much interest will be charged on a monthly basis. You can figure it for yourselves and then see if it is the same as the credit card company. Just knowing this much about the way credit cards work puts you in the 1% bracket. Most people do not know how credit cards work and they are not interested in finding out either. They desire to take the hard way by remaining ignorant. They think the less they know, the better it will be for them.

The worst feature of credit cards are cash advances. If you have to have a cash balance from a credit card, you are in financial trouble. Most people taking out cash advances are not aware of the interest rate. On a credit card that I have that has a fixed rate of 7.9% fixed, the cash advance rate is 24.24%. This means that for a $100 cash advance, you will owe $24.24 in interest. Say you borrowed $1,000, the interest would be $242.40. The total amount borrowed in the first example is $124.24 and in the second $1,242.40. Interest money is dead money. It is not deductible for tax purposes and just enriches the credit card companies.

People taking out cash advances could care less about the interest rate. They are short term in their thinking and all that matters is that they got the cash. They ignore the interest being charged. There are consequences to our actions. Interest is a consequence of borrowing money and it adds to the amount that has to be repaid. This never enters into the equation for cash advance borrowers. They never consider it.

An example of someone not understanding credit cards was reported by the Associated Press in an article titled Credit card interest rate changes hurt on-time payers. The Hard family of Freeland, Michigan is used as an example in this article. The credit card company in this article is Discover. The Hard’s interest rate on this card is 18%. The first question that needs to be asked is why are they using a credit card with that high of an interest rate? I would never use a credit card that had that high of an interest rate. The worse thing that you could do would be to carry a balance with that interest rate. Do they not know this?

The credit card company upped the interest rate to 24.24% because of a credit report on the Hard family. The credit card company penalized them because of the family being a risk for defaulting on their payments. This means that this family will end up spending more money on interest. Instead of disciplining themselves and paying off their credit card balances each month, they have gotten themselves into a situation whereby they may never extract themselves.

Of course, this family blames the credit card company for their financial mess. The credit card company did not hold a gun to their head and force them to get a credit card and then use it and not pay it off monthly. The increase in the interest rate is irrelevant. What is relevant is that this family has not learned the basics of finance and especially credit cards. I do not have any sympathy for them. Their ignorance has caused their plight. They have no one to blame but themselves.

Instead of taking responsibility, the mother Janet Hard testified before the Senate Permanent Subcommittee on Investigations. She said, "My husband and I feel as though we have been robbed." Robbed by who? No one was robbed. She and her husband willingly received the credit card and charged it up. They received something of value in the exchange. They would have been robbed had they not received something of value. They received an unsecured loan every time they used the card. Their ignorance is no excuse. They refused to learn how credit cards work and they have gotten what they deserve.

Of course, this article and example is all a setup. Senator Carl Levin, Democrat-Michigan, who is the chairman of this committee is sponsoring legislation to protect the Hard family from their decisions. What happens is that financially ignorant people like the Hard family go out and make poor decisions, do not like the results and look to the government to try and get even with the big bad credit card companies. They consider these companies to be loan sharks just trying to get rich off poor working families like the Hard family. This absolves them of any responsibility for their actions. Their financial ignorance then gives a reason for the government to seek to regulate the market system to a greater degree.

What is needed is less people like the Hard family. While they may be a hard working and nice family, their financial ignorance ends up costing all our freedom. Their ignorance ensures that the government will put more regulations on the market. This will end up driving up the cost of doing business and each of us end up paying for that. This could have been avoided if the Hard family were financially responsible. They need to learn a lesson but they refuse.

BASIC ECONOMICS

It is obvious that Alan Greenspan does not know the first thing about economics. He operates out of a fantasy world of magic rather than law. He wants the consumer to consume more. How does he want them to do it? By going into debt. That is, going into deeper debt than they already are. He wants people to spend money on things they cannot afford with money they do not have. After all it is for a good cause, he says.

George W. Bush wants to get re-elected so he has signed off on this disastrous course of lowering interest rates to try and stimulate the economy. As a business man, he should know better than turning on the printing press. But you have to buy votes. Money is the only language people know. This is because they are covetous. The other 12 interest rate cuts have done nothing long term. But these men do not care because they are lower class and present oriented.

The Bible says the borrower is a slave to the lender. It is wise to stay out of debt. I am doing my part to help this economy. I am spending less and saving more. This way the tax man will get less. Long term: thrift, hard work and frugality pay off. This is upper class thinking. You can go ahead and sell yourself into slavery, I prefer freedom.

PRACTICAL MONEY SAVING TIPS SERIES-EATING OUT

The Frugal Accountant is always interested in saving money. Saving money is wise. Why spend more for something than you have to? How does one go about learning to save money? It depends upon what is being purchased. If you are buying a big ticket item, it is wise to shop around and compare prices. These are items that are not purchased very often and therefore do not require immediate decision. In this instance, it is always best to take your time.

Saving money means that you keep the savings. If you did not save money on a transaction, then the seller gets more of your money. It is like a game. You want to be able to come out ahead. Saving money also means that we do not have unlimited budgets. Our funds are limited and we want to stay out of debt. To accomplish this means, we want to be able to save money on each transaction that we can.

To save money on purchases, one must first have a system in place. This is not a hit or miss proposition. There is preplanning involved in saving money. Saving money also takes self discipline. When you have a system in place, it will keep you from impulse buying. Nothing can destroy your financial situation faster than buying on impulse. Impulse buying adds up quickly. Impulse buying is a clear demonstration of a lack of discipline and a system. This where a lot of people get in trouble.

People who find themselves having financial troubles will be characterized by a lack of financial discipline. They refuse to discipline themselves, so someone else must do it for themselves, whether it be their bank, credit card company, or the bankruptcy court. Because they refused to do what was necessary, they will be forced against their will to do what they should have done a long time ago. They refuse to take action until it is too late. The cows are out of the barn at this point. This is when they get going.

People in financial troubles are led by perception and not by concepts. Instead of seeking to learn how finance works, they take their credit cards and charge them up to the maximum and then pay the minimum. They are going to be forever in bondage to the credit card companies. To make matters worse, they have more than one credit card. They do not understand the concept of credit and how it works. All that they know is that they see something they want and then they charge it on a credit card.

Financial troubles are objective proof of someone who does not understand how money works. Most of the time they will eat out often, especially at lunchtime. It costs a lot of money to dine out. Most of the time, when my family and I eat out, it costs about $60. If we did this each week, it would end up costing $3,120 for the year. That is not an unsubstantial amount of money. Think how much more it is for those who eat out more often than once a week.

What could you do with an extra $3,000? By foregoing eating out except for special occasions such as birthdays, anniversaries etc., you can save a lot of money over a year. $60 can buy a lot of groceries. There is no comparison between what you get at the restaurant and the grocery store. Dining out is done more for emotional reasons than for any other reason. The Frugal Accountant considers eating out a luxury and not a necessity. For those in financial troubles, it just the opposite. They eat out because it is an emotional necessity for them. They do not consider it a luxury.

One thing that the Frugal Accountant generally will refrain from is having dessert. That little piece of cheese cake is extremely expensive. The Frugal Accountant avoids dessert because he is usually too full from the main course. Dessert is an extra and adds greatly to the overall bill. When eating out there are hidden costs that most people do not think about. When ordering something that costs $9.95, you have to add in tip and taxes. Most people do not think about all the costs associated with eating out. The Frugal Accountant calculates how much the overall bill will be.

When figuring a tip, the accepted amount is 15%. I usually do not give over 10%. Why should they get more than a tithe? When figuring the tip, I see what the amount is before taxes. Why should I tip on tax? You should tip on earned income (your waitress), not on unearned income (taxes). Most people would not be this conscientious because they do not have a system in place. They do not know how they will react to a situation in advance, so they pay on the whole bill. They are tipping on tax. I would rather keep the money to myself.

I know of a restaurant that recommends 15% gratuity. I have not gone there and I will not go there. I do not like someone telling me how much to tip. That privilege remains with me. It is not right to stiff someone on a tip. This type of person is a weasel. He would not want this done to him and if it was, he would be the one to scream the loudest. Knowing how much you can legitimately afford to eat out on is planning ahead of time. This keeps one within their budget.

Spending money is an emotional experience. This is why those who are in financial trouble usually will be seen eating out at lunch. If they spend $7 a day for lunch over a year’s time, he will have spent $1,820. $7 a day for lunch seems like a small amount. Small amount cumulated together eventually add up to large amounts. The Frugal Accountant will eat out lunch rarely. He will pack his lunch. This will save him a good amount of money.

By eating out only on special occasions and eating out lunch rarely, the Frugal Accountant has saved close to $5,000. For someone in financial trouble, this savings would help them out greatly. The Frugal Accountant will take this savings and invest it in something worthwhile and have more of an abundance. The financially troubled would read this and say that it is too hard. This is because they are emotionally addicted to spending money and like all junkies, they do not want to go through the withdrawal symptoms. They choose to have financial troubles. I realize that I am preaching to the choir. Likes beget likes. The disciplined appreciate discipline. The undisciplined hate discipline.

THE WISE STEWARD

Introduction

How much would you be willing to pay to receive something that would actually make you money without a great investment of time and effort? Most individuals that have a great deal of money subscribe to newsletters that keep them abreast of the financial markets and these newsletters cost $125 and up for a year’s subscription. Those who send their money must get some benefit from them. What about those of us who do not have a great deal of money to invest? Can we benefit from a financial newsletter? The largest untapped market are those who need financial advice but cannot afford to pay the price others can.

I am a Pastor. This is my calling. However, the churches that I have been the pastor of generally, have not been able to pay me enough to live off . Therefore, by Providence, I have had to have another source of income, also it has forced me to become inventive in ways to make more money or save money. In other words, I have had to learn to be an astute money manager. I have many years of experience in the arena of finance. My background is very different for a pastor. I have a Bachelor of Arts degree. I took 24 credit hours of Economics. I have the equivalent of a major in accounting also with 24 credit hours. I was a Certified Financial Planner. I worked as a Tax Accountant for many years with some of the largest accounting firms in the world. I have had an interest in finance and economics for quite some time and still retain that interest.

Does the Bible have anything to say about Finance and Economics? The answer is a resounding yes. In fact, if we follow the wisdom of the Bible, we will be farther up the road than by attending the Wharton School of Business or Harvard School of Business and will not have to pay back student loans for many years after graduation. In fact, the things that I will be sharing with you I did not learn in school. I gained my knowledge from reading books from a Christian perspective. Even Christians programs a lot of times are just warmed over worldly ideas. The Bible has had the answer all the time.

I believe that anyone can benefit from being taught these basics of financial management. All of us want a pay raise. Sometimes we cannot control whether or not we get a pay raise at work, but by being good stewards of the resources that God’s providence has given us, we can see our amount of money that we have available actually increase. If you invested $10 a year in this newsletter and it saved you $15, you are ahead $5. So it would have been worth the monetary outlay. You should be able to save far more than this by following the system that will be laid out here for you and by developing a financial acumen. One of the principles is "If you put nothing into something, you get nothing out. If you put nothing in the bank, don’t try to make a withdrawal". This is reality and yet people actually believe they can get something for nothing. If you do not apply what you learn here, you will have wasted your time and money. Always keep in mind that there is no such thing as a free lunch!

Application

This newsletter is titled The Wise Steward. Noah Webster’s 1828 Dictionary defines "wise" as, "1. Properly, having knowledge; hence, having the power of discerning and judging correctly, or of discriminating between what is true and what is false; between what is fit and proper; and what is improper...2. Discrete and judicious in the use or application of knowledge; choosing laudable ends, and the best means to accomplish them. This is to be practically wise." We are seeking to be practically wise. Webster renders "steward" as, "A man employed in great families to manage the domestic concerns, superintend the other servants, collect the rents or income, keep the accounts &c...5. In Scripture and theology, a minster of Christ, whose duty is to dispense the provisions of the gospel, to preach its doctrine and administer its ordinances." Therefore, we are going to be applying knowledge efficiently in superintending our finances by keeping accurate records. If we do such, then we will be wise stewards.

The Lord Jesus said in Matthew 25:29, "For unto every one that hath shall be given, and he shall have abundance: but from him that hath not shall be taken away even that which he hath." Those who have capital have plenty and are able to add to what they already possess. Those who do not expand their capital base will suffer loss and what they possess will be lost through mismanagement. In other words, we reap what we sow. What we plant comes back to us. If we do nothing, we receive back the same. If, on the other hand, we are diligent and put forth productive effort, we will recognize gain. These are concepts that must be grasped.

Behind being a wise steward, we must realize that there is a philosophy. There are presuppositions. Where we start is where we will end. This newsletter will be intensely practical. At the beginning it is vital to begin with concepts so that, as we progress, it will make it easier to apply your knowledge to a given situation. The main idea of the wise steward can be called the capital principle or the productivity principle. Capital if properly utilized becomes productive. Something has to be produced. We must expend energy. Paul said in Ephesians 4:28, "Let him that stole steal no more: but rather let him labour, working with his hands the thing which is good, that he may have to give to him that needeth." Generally, thieves are people who do not like to work or are in an otherwise destitute situation i.e. lack of capital. They do not want to take the time and effort required by work, so they suffer want. The thief shows repentance by being industrious in honest labor and then from his abundance gained by his effort, he is able to give to those who are in need of the basic necessities of life.

In the above example, we see the concept of productivity. "Product" as defined by Webster is "...2. That which is formed or produced by labor or by mental application; as the products of manufactures, of commerce or of art; the products of great and wise men. In the latter sense, production is now generally used." Notice that something is being expended. Products do not come to market by hoping they will. There must be effort put forth to accomplish the task.
God has built subduing the earth into every human activity. Genesis 1:28 says, "And God blessed them, and God said unto them, Be fruitful, and multiply, and replenish the earth, and subdue it: and have dominion over the fish of the sea, and over the fowl of the air, and over every living thing that moveth upon the earth." Webster renders "subdue" as, "To conquer by force or the exertion of superior power, and bring into permanent subjection; to reduce under dominion." This subduing will take the form of either physical labor, machinery, or intellectual operation and in reality is a combination of all three. These comprise capital that allows one to be able to accomplish the assigned task.

It must be understood that from the beginning God intended that man work. So many believe that Eden was to be a life characterized by no labor. This is the main reason that all utopian ideals are never realized. They are not built into the fabric of creation. The Lord Jesus said in John 9:4, "I must work the works of him that sent me, while it is day: the night cometh, when no man can work." Even Jesus realized that He had to be busy doing what His Father had sent Him to do. In other words, He was focused on accomplishing His mission and bypassing all other activities. This is an important principle for each and every one of us. Each of has limited time and talent. We need to discover what we are good at and focus on that. This needs to be our primary focus. This is the concept of specialization. Our present economic structure allows us to do this. Few, however, end up doing this. They spend all their life trying to figure out what they want to be when they grow up.

As Gary North has done in many of his newsletters, find out what you would be irreplaceable at doing and concentrate on that. One of mine is writing. I currently write weekly sermon notes and a Discipleship Training Curriculum. These comprise 2 pages each for a total of six pages a week. This amounts to 312 pages over a year and 1,560 over five years. That is a large book. What am I doing? I am being productive weekly and therefore, building up a lot of writing capital. There are a lot of things that I will not have to research again. I have already done the work. This puts me ahead. If I need a sermon quickly, I can choose from well over 250. They are written, so I have a permanent record, including date when presented. I use the Curriculum during our Discipleship Training. I give the sermon notes to those in the congregation. They can take a sermon home and study it further, if they choose to do so. When people just hear a sermon, they will forget the majority of it. This gives them a reminder of what has been preached. It is a form of capital.

The point here is to show productivity. We are not to be consumer oriented but productive directed. If we produce, then consumption will take care of itself. Most people do not understand this. They think that they can get wealthy by consuming. This just leads to having nothing. What will you be able to show at the end of your life? What will you have left behind that will benefit those that remain? In other words, what did you do with your life? Were you fully employed or did you try to take your ease and thus lived a life of mediocrity? If there is one thing I do not want to have said about me at the end of my life is that I was mediocre. I want to do what I do with excellence. This requires a putting forth of effort, not just putting in the minimum trying to get by.

The Lord Jesus had something to say about ease in Luke 12:16-21, "And he spake a parable unto them, saying, The ground of a certain rich man brought forth plentifully: 17And he thought within himself, saying, What shall I do, because I have no room where to bestow my fruits? 18And he said, This will I do: I will pull down my barns, and build greater; and there will I bestow all my fruits and my goods. 19And I will say to my soul, Soul, thou hast much goods laid up for many years; take thine ease, eat, drink, and be merry. 20But God said unto him, Thou fool, this night thy soul shall be required of thee: then whose shall those things be, which thou hast provided? 21So is he that layeth up treasure for himself, and is not rich toward God." Here is the example of a man who was productive. By his energies, he was able to generate a bountiful harvest (of course, he would have had to rely on God for rain etc. whether he acknowledged the hand of God or not). He was not lazy. However, when he had such an abundance, not only did he not confess that God had enabled him to have this great harvest by being rich toward God, he decided that he no longer needed to be energetic but was going to take it easy. He decided to go into early retirement. It all came to nought.

No matter how economically well someone is, they need to continue to keep active doing something of benefit to others. In other words, the concept of retirement is absent from the Bible. This is when a man usually dies, right after he retires. Our physical bodies were designed for movement and action. It is reported that we have over 664 muscles in our body. This does not sound like something that needs to be sitting around all day long. You might have gathered by my tone that I do not approve of laziness. That is a perceptive observation on your part. Do you think that God accepts slothfulness?

Notice what it says in Genesis 2:1-3, "Thus the heavens and the earth were finished, and all the host of them. 2And on the seventh day God ended his work which he had made; and he rested on the seventh day from all his work which he had made. 3And God blessed the seventh day, and sanctified it: because that in it he had rested from all his work which God created and made." Notice the word work in the second verse. When God created the heavens and the earth in a literal 6 days, He was working and if God worked, how can we then put ourselves above Him? God did not say when you are 65 years old that you no longer should work. This is the humanist dream world, trying to escape reality of God’s world. Many people work harder trying to get out of work rather than working. When you do something because you enjoy it, no doubt labor almost becomes pleasurable.

As we proceed further, we will continue to discover that the Bible has much to say about economics. Noah Webster’s 1828 Dictionary defines an "economist" as, "One who manages domestic or other concerns with frugality; one who expends money, time or labor judiciously, and without waste." This is what you are going to become, a good economist and we are going to learn how to economize. Webster renders this word as, "To manage pecuniary (my note: monetary, financial etc.) concerns with frugality; to make a prudent use of money, or of the means of saving or acquiring property. It is our duty to economize, in the use of public money, as well as of our own." Management is the key. To be a good manager requires skill and especially accurate information on which to base decisions. If you do not know how much money you have, how can you make wise determinations?

Both of these definitions used the word "frugal." "Frugality" as defined by Webster is, "Prudent economy; good husbandry or housewifery; a sparing use or appropriation of money or commodities; a judicious use of any thing to be expended or employed; that careful management of money or goods which expends nothing unnecessarily, and applies what is used to a profitable purpose; that use in which nothing is wasted...Frugality is always a virtue...Without frugality none can become rich, and with it few would be poor." It is virtuous to be frugal. It demonstrates wisdom in action. It realizes that we live in a world of scarcity. Also, as was pointed out in the last part of the definition, you will not become rich but by becoming frugal. The best way to fight poverty is not by creating a welfare state, but by citizens learning the excellence of frugality.

Conclusion

All this requires diligence on our part. Most people have never given a thought to the area of economics. They did not consider that they had an integral part to play in the advancement of their financial situation. If I had a choice between being healthy and wealthy and sick and poor, which do you think I would choose? Which would you prefer? There is no virtue in being poor. I have always been interested in success and have studied it for many years. I characterize myself as a high achiever. I want results so I look for what works and implement it. I look for what gets me the effects I am looking for. What about you? Do you have a strategy to increase your wealth over time or are you just drifting along, accepting everything that comes your way?

Most people have not taken the time to consider what they are doing in the realm of economics. To some of you this will be all new. I believe that I have accomplished my goal in this initial newsletter, I have got you to think about things in a different way. You have already begun to consider ways where you can be more frugal and a wiser steward of God’s providence. As we progress, you will learn to become a financial whiz without going seven years to college, deep in debt, to get an PhD in Economics. God and the Bible have given us a short cut by which you are not drowning in debt, but rather will have become affluent.

WHO DETERMINES WHAT LABOR SHOULD COST?

In our day and time, there has been much clamoring over the minimum wage. The minimum wage is, of course, a creation of government. Our government is extremely arrogant in so many ways and this is just one. They think that they can tell business owners how much they have to pay for labor. They want to regulate and control every aspect of our lives. They honestly believe that we are incapable of looking out for our own best interests.

Nothing could be further from the truth. I am guided by self-interest. I look out for my own best interests. This is, of course, not at the expense of others. The fact of the matter is that if I do not look out for my own best interest, who will? The government wants us to look to them for direction in every facet of our lives. It is coming to the point that we are going to have to have a hall pass just to go to the bathroom in our homes. This is the control that government seeks in our daily lives.

When one does not accede all of God’s attributes to Him, then they take these characteristics to themselves. In other words, they replace the God of the Bible with themselves. This is the epitome of Genesis 3:5 right out in the open, "For God doth know that in the day ye eat thereof, then your eyes shall be opened, and ye shall be as gods, knowing good and evil." All elites believe themselves to be omniscient. When their policies are put into practice, they always have the opposite effect of what was originally intended. In other words, they lack what they say they possess.

They do not want to be measured by the results of their programs, but by their good intentions. Good intentions have never provided a living for anyone. Only productivity has delivered the goods and to be productive one has to have a job. Minimum wage legislation keeps certain people out of the workforce. Before delving into why this is true, we must first ascertain what is the philosophy behind the minimum wage.

The first thing that ought to stand out to us regarding the minimum wage is the fact that is wholly arbitrary. Who can say with absolute accuracy that it is set at the right level for each and situation in the marketplace? To be wholly set at the correct wage would require the Godlike attribute of omniscience. Since men lack this attribute, the must make the best guess they can based upon the numbers that are applicable to their particular business.

One thing that needs to be pointed out from the hypocrites in our Congress (House and Senate) is the fact that these people have the ability to determine whether or not they get a pay increase each and every year. Is it not astounding that they vote themselves a pay increase each year? It should be obvious that these hypocrites are not bound by the minimum wage laws, even though they should be because any amount of money paid to them is overpaying them.

Who does the minimum wage really apply to then? Those who have few job skills, generally the entry level worker. We are not talking about anyone who possesses much job experience or skill level. The higher skill level will demand a greater price from the market. You do not trust brain surgery just to anyone and for good reason. Also, one does not hire a minimum wage worker to build a $500,000 home. No one could maintain a household on the minimum wage. Therefore, it would be applicable, generally, for single young workers.

The minimum wage works against incentives. It is a floor beyond which an employer cannot go below. Since it is a guarantee, there is no incentive on the part of the worker to improve his skills. The U.S. Government puts a gun in the belly of an employer and tells him that he must pay this amount or face the consequences. The minimum wage is therefore, paid by coercion and not voluntarily. The minimum wage is code for welfare. It is given to people who may not earn what they are paid.

The market rewards the productive. Minimum wage workers are hopefully trying to increase their skills. If they are not then, what this legislation has produced is a permanent underclass living in poverty and a strain upon a government’s resources. All of the government’s welfare programs would be open to these people. They would be living a subsistence level unless they are receiving some form of subsidy i.e. from parents or the government.

Basic economics are always in force because we live in God’s world. The unemployment rate is high among young entry level workers with few job skills because many small businesses simply cannot hire them at the artificially set minimum wage. The minimum wage guarantees permanent unemployment of the unskilled work force. Instead of allowing the market and employers to determine the wages of its workers, the government intervenes on socialistic principles. If anyone, wants to see the results of such policies, all we have to do is remember all communist governments. Because they take away all incentives to better oneself, they have set in motion, bankruptcy.

Government regulation and bureaucracies is an attempt by our government to legislate itself as god. Minimum wage legislation is an attempt at omniscience. It is, however, a failed attempt. It has failed everywhere it has been tried. If someone wants to make more money, then they must increase their job skills. The market will pay them what they are worth. Our legislators are only worth the minimum wage themselves. God has already legislated. Their legislation is fallible as they are and next to worthless.

Who then determines what labor should cost? The market and employers are best to make this judgment. The government who claims omniscience does not have clue and the sooner they butted out of people’s business in this regard, all the better for each and everyone of us. There should be no minimum wage.

SPENDING CURRENT INCOME

You only go around once in life. We never know how much time we left in this life. All that we know is that we have the present. So why not be able to enjoy the present? Being frugal does not preclude enjoying of life. Being frugal has to do with living within one’s means. Being frugal includes being systematic in savings. Being frugal also means balancing the two extremes of being a spendthrift and being parsimonious (in a bad sense).

A spendthrift is one who spends money indiscriminately and profusely. Someone who is parsimonious is excessive in their attachment to their property and will spend less than is necessary or honorable. Both of these extremes are to be avoided. Frugality would mean that we spend only what is necessary and also means that we not only pay our bills in full but when required to leave a tip, we do so adequately. A parsimonious man would not tip anyone.

It is good to save money but not to the exclusion of the enjoyment of life. Solomon gave us the following wisdom from Ecclesiastes 9:7-9, "Go thy way, eat thy bread with joy, and drink thy wine with a merry heart; for God now accepteth thy works. 8Let thy garments be always white; and let thy head lack no ointment. 9Live joyfully with the wife whom thou lovest all the days of the life of thy vanity, which he hath given thee under the sun, all the days of thy vanity: for that is thy portion in this life, and in thy labour which thou takest under the sun." Enjoy yourself and have a good time. Spend your discretionary income on what you want.

Discretionary income is money you have left over once you have met all of your necessary expenditures. Necessary expenditures includes not only your bills but first and foremost God’s tithe (which is your first obligation to be paid) and your savings. The priority is to pay God first, pay yourself second, and pay your creditors third. Anything left over is yours to do with as you wish. This is the land of wants. The needs are met, now go and have a good time.

Does God want us to have a good time? Deuteronomy 14:22-26 provides the answer, "Thou shalt truly tithe all the increase of thy seed, that the field bringeth forth year by year. 23And thou shalt eat before the LORD thy God, in the place which he shall choose to place his name there, the tithe of thy corn, of thy wine, and of thine oil, and the firstlings of thy herds and of thy flocks; that thou mayest learn to fear the LORD thy God always. 24And if the way be too long for thee, so that thou art not able to carry it; or if the place be too far from thee, which the LORD thy God shall choose to set his name there, when the LORD thy God hath blessed thee: 25Then shalt thou turn it into money, and bind up the money in thine hand, and shalt go unto the place which the LORD thy God shall choose: 26And thou shalt bestow that money for whatsoever thy soul lusteth after, for oxen, or for sheep, or for wine, or for strong drink, or for whatsoever thy soul desireth: and thou shalt eat there before the LORD thy God, and thou shalt rejoice, thou, and thine household." The LORD here gives the Israelites the right to celebrate by having a feast of whatsoever they desire and they were to rejoice for what the LORD had provided for them.

One way to accomplish having discretionary income to spend on vacations, trips, or other wants is to allocate your savings in a sixty, twenty, twenty fashion. Sixty percent should be for long term investing or savings. This amount should never be touched but allowed to grow. Twenty percent should be for an emergency fund. An emergency fund is what it says it is for unseen emergencies that arise such as an unexpected vehicle repair. The final twenty percent is a want fund. This is money you spend on whatever you want to. Say that you save one hundred dollars a week. Sixty dollars would go for into your long term fund, twenty dollars for emergency fund, and twenty dollars just to blow on whatever you want to. By following this plan over the course of a year, you would have three thousand one hundred twenty dollars in your long term fund, one thousand forty dollars in your emergency fund and zero in your fun fund. You will have spent all one thousand forty dollars having a good time.

Man needs to have releases. Without having a release valve, he will simply blow off steam in a wrong fashion. All work and no play makes Jack a stressed out mess. Paul taught us this important principle in 1 Timothy 6:7, "For we brought nothing into this world, and it is certain we can carry nothing out." Everything that we accumulate in this physical world, we are going to leave it behind. Being too attached to our physical property is not an enviable spiritual attitude to possess. Parsimony is covetousness. Being covetous is breaking the Tenth Commandment.

Spending money is an emotional experience. Being frugal takes the emotion out of spending money. At the same time, we cannot deny the emotional side of our being. This is why it is essential to establish a fun fund. When I was not as wise as I am now i.e. learned from making bad decisions, I would limit how much my family could spend on an item on the menu at a restaurant. This can take all the fun out of going out to eat. Now, I say choose whatever you want on the menu. I have not quite got to allowing the dessert part yet but maybe I can bring myself to it at some point. Usually, we are to full from the main fare to want to add to it by having dessert. Discretionary income is meant to be spent currently.

PLANNING AHEAD

The key to being mature is being responsible. As we grow older chronologically, our life experiences should have taught us many things. One of these experiences is to plan ahead. Planning ahead presupposes the attribute of foresight. Noah Webster’s 1828 Dictionary defines "foresight," as, "Prescience; foreknowledge; prognostication; the act of foreseeing. Milton. 2. Providence care of futurity; foreknowledge accompanied with prudence in guarding against evil. Spenser." We know that God has all foreknowledge.

Since we are created in the image of God, we possess foreknowledge to a limited degree. We possess foreknowledge because of our prior knowledge. We can make somewhat accurate predictions. This ability enables us to progress beyond the obvious. It is an extension of our intelligence. Another concept that comes to mind, in this regard, is forecasting. Every business attempts to forecast future consumer demand. Without this aspect, they could not properly have an adequate supply of goods.

Because we live in a world of predictability, we can make these projections and be relatively correct. We have meteorologists who forecast the upcoming weather for us. While sometimes they are incorrect, they at least provide us with the means to make an assessment about what we can expect on a given day. If they say that it will be 12 degrees and it turns out to be 18 degrees overnight, it is still cold and we would know what precautions to take. We are all in need of knowing what the weather is going to be. You would not decide to take a vacation to Florida during a hurricane, would you?

Proverbs 29:18 speaks about foresight, "Where there is no vision, the people perish: but he that keepeth the law, happy is he." People perish because they are unable to make accurate prognostications about the future. This is because they no longer keep the law of God and the world becomes to them a place of pure chance and their lives are predicated upon the winds of fate. The one who keeps the law of God is happy because he makes accurate forecasts of the future and he is blessed for his efforts.

If something is true, then, by definition, the opposite is also true. This is because truth is always in balance. The book of Proverbs is replete with this very axiom. One such example is Proverbs 20:4, "The sluggard will not plow by reason of the cold; therefore shall he beg in harvest, and have nothing." The idler does not plan ahead. He always has a justification for his inactions. This verse tells us that those who fail to plan ahead will be led into poverty. The opposite would be true for those who are diligent. Because they took the time and effort to forecast the future, they will have plenty in the times to come. This is the conclusion of Proverbs 13:4, "The soul of the sluggard desireth, and hath nothing: but the soul of the diligent shall be made fat." Knowing the truth axiom enables us to know that what is true also has an opposite truth.

All foresight is based upon this commandment found in Exodus 20:3, "Thou shalt have no other gods before me." This is a negative command. Its opposite would say that we are to have only one God. If we keep this commandment, in its full import, then Proverbs 3:9-10 will be the result, "Honour the LORD with thy substance, and with the firstfruits of all thine increase: 10So shall thy barns be filled with plenty, and thy presses shall burst out with new wine." This would be foreseeing the consequences of our actions. In this regard, the results would be positive.

The book of Proverbs is replete with examples of how to have an abundance and how to be poverty stricken. A good illustration is found in Proverbs 28:19, "He that tilleth his land shall have plenty of bread: but he that followeth after vain persons shall have poverty enough." Those who are willing to put forth the effort of forecasting i.e. planning ahead and then, working their plan, will have prosperity. The contrast here is for those who follow dreamers, whose plans and schemes never do come to fruition. They boast of great feats but deliver on nothing. It is always about what they are going to do, not what they actually accomplish, which is nothing.

Wise individuals are those who have learned from their mistakes and now take them into account when forecasting the future. They know what does not work and they have the knowledge not to repeat what failed, but try something that will succeed. It all comes down to trial and error. While this may be the case, we can short cut the process by looking to the Lord in His word and think His thoughts after Him. By so doing, we become omniscient to a limited degree.

Planning ahead would normally be thought to be merely physical. Planning ahead is first and foremost a spiritual enterprise. Planning requires thought. This is a spiritual exercise. As has been pointed out elsewhere, short term thinking will result in lower class living, whereas, long term planning brings about upper class thinking. Those who desire to be prosperous must learn the character trait of delayed gratification. Without it, nothing of any long lasting reward will be available.

Those who have truly planned ahead have made reservations for the life hereafter. Paul made this clear in 2 Corinthians 4:17-18, "For our light affliction, which is but for a moment, worketh for us a far more exceeding and eternal weight of glory; 18While we look not at the things which are seen, but at the things which are not seen: for the things which are seen are temporal; but the things which are not seen are eternal." Here we see that physical life is temporary. The most important things are clearly spiritual. To plan ahead means taking care of the spiritual first and foremost and then the physical. Most people take care of the physical and completely ignore the spiritual. My brethren, such things ought not to be.

WINNERS AND LOSERS

All of life can be characterized between winners and losers. It is always better to be on the side of the winners long term. Question, Why be a loser? What advantage is there in this? Winners are always determined by competence. Losers are always incompetent. There is no getting around this. Winners never give up and losers give up easily. The old saying is that winners never quit and quitters never win. How true.

Adversity is something which we all of us face each and every day. Most days, not everything goes the way we want it go. Trials and temptations are designed, not to weaken us, but to strengthen us. We are to grow stronger, not weaker. This is the crucible where the metal of faith is completed. The mass of humanity is content with being mediocre. In fact, this is their middle name. They do nothing to try to improve their present conditions. They put forth no effort to be over comers. They are content with the status quo. Their mantra is that this is the way things are and there is nothing you can do about it.

The market economy is made of winners and losers. Winners reap the rewards and losers declare bankruptcy. The market economy is comprised of competition. Competition forces those who enter the market to perform at their best or be thrown out with the rest of the trash. It separates the proverbial wheat from the chaff. Only the competent survive. This means that quality improves, and does not decrease.

Quantity is good, but quality is better. You can have a whole lot of something that is nothing more or less than junk or you can have few of something that has value. Something which has value in our day is oil. Oil is the most valuable commodity of our day. It is more valuable than diamonds or gold. It is something that we cannot do without. It effects our daily lives. The question is why not let the oil companies win? We all would be better off for it.

The only legitimate market that the government has a monopoly on is law enforcement. They are to protect our market economy from evildoers. This is their paramount function. They, however, decided that they need to be God. They have the arrogance to believe that they are omniscient and have a reality show called "Government Knows Best." Government does not know what is best for me when it comes to the market. They are to protect the righteous and good people in their daily market transactions and punish evildoers.

Being able to compete has behind it the concept of competence. From a Biblical point of view, competition and competence are best illustrated in the following parable found in Matthew 25:14-30, "For the kingdom of heaven is as a man travelling into a far country, who called his own servants, and delivered unto them his goods. 15And unto one he gave five talents, to another two, and to another one; to every man according to his several ability; and straightway took his journey. 16Then he that had received the five talents went and traded with the same, and made them other five talents. 17And likewise he that had received two, he also gained other two. 18But he that had received one went and digged in the earth, and hid his lord’s money. 19After a long time the lord of those servants cometh, and reckoneth with them. 20And so he that had received five talents came and brought other five talents, saying, Lord, thou deliveredst unto me five talents: behold, I have gained beside them five talents more. 21His lord said unto him, Well done, thou good and faithful servant: thou hast been faithful over a few things, I will make thee ruler over many things: enter thou into the joy of thy lord. 22He also that had received two talents came and said, Lord, thou deliveredst unto me two talents: behold, I have gained two other talents beside them. 23His lord said unto him, Well done, good and faithful servant; thou hast been faithful over a few things, I will make thee ruler over many things: enter thou into the joy of thy lord. 24Then he which had received the one talent came and said, Lord, I knew thee that thou art an hard man, reaping where thou hast not sown, and gathering where thou hast not strawed: 25And I was afraid, and went and hid thy talent in the earth: lo, there thou hast that is thine. 26His lord answered and said unto him, Thou wicked and slothful servant, thou knewest that I reap where I sowed not, and gather where I have not strawed: 27Thou oughtest therefore to have put my money to the exchangers, and then at my coming I should have received mine own with usury. 28Take therefore the talent from him, and give it unto him which hath ten talents. 29For unto every one that hath shall be given, and he shall have abundance: but from him that hath not shall be taken away even that which he hath. 30And cast ye the unprofitable servant into outer darkness: there shall be weeping and gnashing of teeth." Two were proficient and one was inefficient.

Those who were successful, in this parable, followed an economic law of economies of scale. They put their talents to their highest use and were able to increase their holdings. The Lord commends them for their expenditure of effort. Now the market is better off because of their labors. The one that hid his talent did not want to compete. He was satisfied with the status quo. The market was harmed not benefitted by his actions. The Lord calls him an unprofitable servant. He was satisfied with mediocrity. To be mediocre is to be wasting valuable limited resources. These people are losers.

Christians are to be exceptional in all that they put their hands to. The Lord Jesus Christ said in Luke 9:61-62, "And another also said, Lord, I will follow thee; but let me first go bid them farewell, which are at home at my house. 62And Jesus said unto him, No man, having put his hand to the plow, and looking back, is fit for the kingdom of God." Once we become Christians there is nothing to look back to in our former lives. It is only forward and upward. This means that our skills i.e. competence, should be increasing in our callings. Christ does not accept losers, only winners. Which are you?

PERSONAL RESPONSIBILITY DOES NOT SELL

If you want to shrink your market opportunities, try preaching personal responsibility and yet, it is personal responsibility that leads to prosperity. Most people want to get something for nothing. I recently read in the Johnson City Press about how a convenience store clerk found a $10 bill in the store and used it to purchase a lottery ticket. It turns out that the lottery ticket was a winner, to the tune of $1 million.

Her comments on her winning are enlightening. "Schneider, 32, opted to take 20 yearly payments of $50,000, or $34,500 after taxes. ‘If I’d taken a lump sum, I’d be broke again within five years,’ she said." Well, it is out in the open. She does not know how to manage money. At least she realizes this. Of course, the media desires for you to have pity on this woman and her good luck. As with the media, it is designed to touch your heart strings. It is designed to be emotional in nature. There is, however, no mention about the morality or intellectual side of this situation.

I, for one,am totally repulsed by this situation. The story says, "The single mother–with nine maxed out credit cards and $8,500 in debt for her associate’s degree..." First of all, why is she a single mother? We do not know if she was previously married and now divorced or whether she has ever been married and had children out of wedlock. How many children does she have? Does she have custody? Do they live with her? We are not told, but these questions are relevant.

What in the world is she doing with 9 credit cards? It is obvious that she is not financially astute enough to handle even one card. They are maxed out. She is bankrupt. On top of that she owes $8,500 for an associate’s degree. If she has an associate’s degree, why is she working at a minimum wage job? What did she get this degree in? Did she upgrade her job skills or did she major in something that does not translate into a marketable skill, like Women’s Studies?

The article does not go into these areas because it is designed to appeal to the emotions rather than the intellect. Now, we need to analyze the lottery itself. What is a lottery anyway? It is gambling right out in the open. It is not productive but rather destructive over the long period. Who are those who play it? Convenience store clerks in Ohio who are in serious debt. Those that play this are those who live for this day with no regard for the future i.e. poor people.

The lottery is a tax on the those who can least afford to pay it. While the majority that do play can afford to and limit their purchase, there are those who like this convenience clerk that cannot. What is the lottery based upon? That you can get a lot of money by not expending and amount of productivity. Does the lottery add to the wealth of a nation? The answer is a resounding no. State governments use this ill gotten gain most of the time to fund education. They do this to get another source of funding.

Millionaires do not stand in line to play the lottery. To them it is a grand waste of time and money. They are to busy making their own money. They have learned the principles of personal responsibility, especially delayed gratification. The lottery is all about instant gratification. No skill involved here. This is where the masses dwell. They never get it. They think that the rich are that way because of reasons not related to the truth. The reason that people remain poor is because they are not going to discipline themselves to better their condition. They want what they see as the easy way out, the lottery.

The lottery is based upon the principle of chance which is Darwinian to the core. Your odds of winning are slim to nil. However, if you go out and get a job and work it with excellence and increase your skill level and become successful, then you will prosper. In this regard, you are not relying on chance but on predictability. The world is not governed by chance but by predictable laws. The lottery tries to circumvent these predictable laws.

The Bible teaches personal responsibility, thrift, and productivity. It is the Protestant work ethic that has made America great, not the lottery. This is stated in Ecclesiastes 9:10, "Whatsoever thy hand findeth to do, do it with thy might; for there is no work, nor device, nor knowledge, nor wisdom, in the grave, whither thou goest." In other words, put forth your best effort in all of your endeavors, if you desire to be wealthy.

The lottery destroys motivation for people to better their lot. They are led to believe that they can get something for nothing. The highlight of their day is hanging around convenience stores buying lottery tickets. They say, I know that this one is the big one. The lottery encourages laziness and sloth. Why work, if you can win the lottery? Sounds like government entitlement programs doesn’t it? This is because the lottery is built upon a false foundation. It is socialism right out in the open. No longer hanging in the closet.

Paul wrote in 2 Thessalonians 3:10-12, "For even when we were with you, this we commanded you, that if any would not work, neither should he eat. 11For we hear that there are some which walk among you disorderly, working not at all, but are busybodies. 12Now them that are such we command and exhort by our Lord Jesus Christ, that with quietness they work, and eat their own bread." God’s provision for our daily bread is to come from being productive in gainful employment. Working for the Lottery is not deemed a biblical vocation. It promotes the opposite of orderliness. God does not want us to play the lottery, but work.

Christians are opposed to the lottery. It is counter to godliness. Kristina Schneider says that if she took a lump sum she would be broke within five years. Here is a prediction that will be accurate, after 20 yearly payments, she will be broke. Unless, she learns the principles of financial management, she will be back in the same position she was prior to winning the lottery. Even winning the lottery does not ensure that you won’t be impoverished later. Spiritual bankruptcy leads to financial bankruptcy.

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.

EARNING AN INCOME

Finance is an extremely important area of our life. It takes up an inordinate amount of our time. We are either busy earning money or spending it. Physical life would cease to exist without it. We are surrounded by finances wherever we go. Finance is an inescapable concept. Knowing this up front brings us to the point of developing a system by which we can best use our financial resources.

I would say that the vast majority of people desire to have more money. Do you know of anyone who would turn down a pay increase, even if it was modest? Personally, I accept all pay increases, even if they are small. A small pay increase, in the short run, looks paltry but when you look over the long run, it adds up to be somewhat substantial. For instance, say your pay goes up $25 a week. This may not buy much this week but save that amount over a year by keeping your spending the same before the pay increase and you have $1,300 in a years time. You can buy something substantial now.

Most people do not think in these terms. This is because their focus is on the short term. Your class level is determined upon your view of finances. The wealthy have a long term view of finances, while the lower class are concerned about the present. Each of these views have consequences. One is characterized by planning, the other by its lack of planning. The lower class will be impulsive with regard to their finances.

The key to being wealthy is not determined by how much money you earn. It is determined by how much you keep. There are many people who earn high incomes that live from paycheck to paycheck. They are Income Statement rich and Balance Sheet poor. Truly wealthy people are potentially Income Statement rich and definitely Balance Sheet wealthy. These wealthy people have learned how to increase their assets on a continual basis.

Wealth building begins with having a financial plan in place. Without direction, we will wonder aimlessly. All financial planning begins with earning income. This takes on many different forms. What is important here is to find out what you excel at and put your efforts in to it. My wife has been working since she was fifteen (except for ten years when she did a different kind of work in home-schooling our two daughters). She wanted to work in the legal field. The Navy had a program whereby they paid for her to attend a community college to get a Paralegal certificate.

She enjoys legal work above all else. Recently, she was employed by the local hospital as a secretary. Though it was something she could do, her heart was more in the legal field. She has been recently hired by a law firm. One of her comments in her interview, was that she loved the smell of law books. It is something that she enjoys doing. This makes the drudgery and tediousness of work more pleasurable, finding something that you enjoy doing.

However, this cannot be the only criteria. Christians are always motivated by a higher standard. They believe in the Protestant Work Ethic of Ecclesiastes 9:10, "Whatsoever thy hand findeth to do, do it with thy might; for there is no work, nor device, nor knowledge, nor wisdom, in the grave, whither thou goest." Whatever we do, we are to put all our time and ability into it. We are enjoined to always give our best. I believe that whatever we do, it should be done with excellence i.e. to the best of our ability. This is to be our day in and day out attitude. Consistency is indeed a rare gem but essential for Christians and their witness to others.

If a Christian is not exhibiting excellence on the job, who is going to listen to them when it comes to matters of the heart? They have demonstrated an inconsistency that damages their witness for the Lord. The Christian must be the most reliable and dependable individual on the job. Integrity is just a word in our society but its demonstration will bring wealth to those who possess it.

Proverbs 22:29 reads, "Seest thou a man diligent in his business? he shall stand before kings; he shall not stand before mean men." The Amplified Bible clarifies this verse. "Do you see a man diligent and skillful in his business? He will stand before kings; he will not stand before obscure men." This is what a Christian is to be in their work, diligent; and skillful.

Noah Webster’s 1828 Dictionary defines "diligent" as, "steady in application to business; constant in effort or exertion to accomplish what is undertaken; assiduous; attentive; industrious; not idle or negligent." Does this describe you? If not, then you have some work to be done in your life. If you have not been diligent in your profession, then your witness for the Lord has been greatly diminished. There are many people who are great starters but not great finishers. Someone who is diligent is both. They stay after a task until it is completed. This makes them much in demand. They are a rare breed.

"Skillful" is rendered by Webster as, "knowing; well versed in any art; hence, dextrous; able in management; able to perform nicely any manual operation in the arts or professions." Someone who is skilled in any art or profession has fused together theory and practice. They are not satisfied with their knowledge and are increasing what they know. They are constant learners which increases their capacities and abilities to continue to perform at a higher level. This will increase their income.

I have been gifted with the ability to write. I have been studying writing and grammar books because I want to become better at writing. Also, I have been studying logic and rhetoric because a lot of what I deal with is based upon arguments. I want to improve in these areas so that any argument that I bring the table is irrefutable. I never did like losing and I do not intend on losing a debate because I was not diligent and skillful.

This is a starting point to gaining wealth. It begins with being productive and providing service. God hates laziness. It is time to get busy.

THE FRUGAL ACCOUNTANT

There are many things that are important to us. Some are more important than others. Once we have learned good financial practices, we should keep doing them over and over again. When you find what works, it is always wise to keep such a program implemented. Following a system is a wise practice. It enables one to sort out what works and what does not.

What is frugality? "Frugality" according to Noah Webster’s 1828 Dictionary is "prudent economy; good husbandry or housewifery; a sparing use or appropriation of money or commodities; a judicious use of any thing to be expended or employed; that careful management of money or goods which expends nothing unnecessarily, and applies what is used to a profitable purpose; that use in which nothing is wasted." One can hear the old saying waste not, want not.

Prudent is cautious wisdom. Frugal people do not put their money in speculative investments. They would be more prone to try and make money in tried and true ways. In the above definition, there is not a negative to be found. You see the words, prudent economy, good, sparing use or appropriation, judicious use, careful management, expends nothing unnecessarily, profitable purpose and nothing wasted. The frugal person is a wise man.

Webster renders an "accountant" as "one skilled in mercantile accounts; more generally, a person who keeps accounts." Mercantile accounts are business accounts. An accountant records financial transactions. Accountants use what is called double entry accounting. This is what keeps the financial statements in balance. At a very basic level, the two statements that will be used here are the Balance Sheet and the Income Statement.

The Balance Sheet is comprised of three parts, Assets, Liabilities and Net Worth. Net Worth is the residual between what you own (assets) and what you owe (liabilities). Net Worth is what you actually own free and clear of any claims. The Income Statement records revenues and expenses to arrive at net income or net loss. This statement allows you to assess where your money comes from and where it is spent. It allows you to see if you are operating in the black (good) or whether you need to declare bankruptcy (red).

A frugal person is one who operates their financial affairs cautiously and judiciously. They have maintained meticulous financial information by keeping accurate records. They know how much they spent on each category. They are wise in not spending more than they earn. If they want to spend more money, they find ways to make more money.

It is a well known fact that the majorities of businesses fail because of poor management. The first businesses were households. Businesses are based off of the model of households. One of Webster’s definitions of manager is interesting. It is "a person who conducts business with economy and frugality." Proper management training takes place within the family. One who learns how to manage assets and control spending, in a household, will be qualified to do the same when conducting an outside business.

Good managers economize and are frugal. They pay attention to the smallest of details, realizing that the smallest can eventually add up to the biggest. They watch the bottom line known as net income or net loss. A good manager knows that some things are beyond his control and that the unforseen can and does happen. Since he has been judicious in his affairs, he will have the necessary assets to meet these emergencies.

Good managers follow Romans 12:11, "Not slothful in business; fervent in spirit; serving the Lord." If you are not to be something, then you are to be its opposite. Slothfulness is sluggishness, being idle or laziness, slowness or being tardy. Paul is encouraging us then to be earnest and diligent in the affairs of life. A good manager will be all of this. They are characterized by their resolve to accomplish the task until it is completed. They are reliable and their word is solid.

Being a frugal accountant is first and foremost a spiritual enterprise. Ethics do matter. Substance is more important than form. We all want to be financially successful. One cannot be financially successful by not learning the rules that govern success. This is why this discussion began with the idea of instituting a system. With it you are guaranteed financial prosperity.

Deuteronomy 29:9 reads, "Keep therefore the words of this covenant, and do them, that ye may prosper in all that ye do." Financial prosperity can only be achieved upon keeping God’s ethics. Not only knowing what these ethics are but also applying them will bring about the desired results. Financial prosperity is defined as having all of your physical needs met. Usually, this also means that you have in excess of your needs supplied because of being wise in financial matters.