Our world has greatly changed over the last few months. Suddenly, the drama of the upcoming Presidential election, the continued political arguing in Washington, tensions with foreign nations, and even the preparation for summer vacations have taken a back seat to the coronavirus. Everyone has been impacted by the pandemic, some more significantly than others. While our current focus should be on caring for the sick and slowing the spread of the virus, we’re wise to remember the guidance of Proverbs 24:32, “When I saw it, I considered it well; I looked on it and received instruction.” New financial commitments may come from such instruction!
Our Heavenly Father, in ways that only He can, uses tragic circumstances of our fallen world to teach and guide us, but only if we are seeking His wisdom. As we navigate the new normal of quarantines, travel restrictions, and closed businesses, let us not overlook the lessons God may be trying to teach us along the way. If you are feeling financial stress on top of the health and safety concerns, consider making a few financial commitments for when the pandemic ends.
Commit to creating a monthly spending plan
Luke 12:28: “Suppose one of you wants to build a tower. Won’t you first sit down and estimate the cost to see if you have enough money to complete it?”
Quite simply, a spending plan maximizes the value of each incoming dollar. By assigning every dollar to a specific task before the month begins, fewer dollars slip through your fingers. Needs such as food, housing, and utilities are prioritized, but a spending plan should also include fun things like entertainment, eating out, and saving for vacations. A spending plan doesn’t have to be “rice and beans” every night. Enjoy the life and income that God has provided, but do so with intentionality and purpose.
Commit to building an emergency fund
Proverbs 21:20: “There is desirable treasure and oil in the dwelling of the wise, but a foolish man squanders it.”
Many families have learned how close to the edge they have lived their financial lives. A sudden job loss has shown them that living “paycheck-to-paycheck” isn’t just an issue for other households. COVID-19 demonstrated how quickly things can change due to circumstances completely beyond our control. A pandemic was beyond imagination just a month ago, yet here we are. While an emergency fund won’t insulate your family from exposure to the health effects of the virus, it can lessen the financial burden. For most families, an emergency fund of three to six months of essential expenses can turn a financial crisis into a mere financial inconvenience. Create your own bailout fund instead of relying on Congress to provide for your needs.
Commit to paying off consumer debt and staying debt-free
Romans 13:8: “Owe no one anything, except to love each other.”
In addition to meeting basic consumption needs like food and utilities, many also struggle with staying current on their debt payments. While their previous income may have easily covered the payments, millions of job losses have shown how quickly that can change. Even 0% interest debt typically requires timely monthly payments to stay interest-free. Scripture calls on us to owe no one anything and calls debt a form of slavery (Proverbs 22:7). Heed God’s instruction and free yourself from debt.
Commit to creating legal documents necessary for your medical needs and those left behind
Proverbs 15:22: “Plans fail for lack of counsel, but with many advisers they succeed.”
Considering your death, illness, or incapacity isn’t a fun topic to discuss. As such, we may put off dealing with these issues until a later date, assuming we’ll have time to address them at a later date. COVID-19 has shown us that our lives are “a vapor that appears for a little time and then vanishes away” (James 4:14). Every day we read stories of otherwise healthy people struck down in the prime of their lives by a microscopic virus. Being a Godly steward is not just about your current management of His resources, but also includes how your assets are handled if you are incapacitated or die. The laws of each state are different, so commit to consulting with qualified local counsel to see that your stewardship of His resources is complete.
Commit to regularly contributing to your retirement accounts
Ecclesiastes 11:2: “Give a serving to seven, and also to eight, for you do not know what evil will be on the earth.”
As the stock market has swooned over the last several weeks, many counseling clients have asked what they should do with their investments. Sell and wait for the market to recover? Stop contributing to their 401k at work? Proverbs 23:4 tells us to “not wear yourself out to get rich; do not trust your own cleverness.” Trying to anticipate what the stock market will do in the near term is impossible. Even the financial “experts” can’t agree on what will happen next.
Don’t try to outsmart the market. Keep investing regularly in your 401k or IRA. The money withheld from your paycheck today will buy more shares than the same amount bought earlier this year. In the long-run, your finances will be stronger from this downturn if you keep investing throughout the downturn. While we can’t know when the volatility will end and the market will recover, we can learn from history that it will do so eventually. Being patient, persistent, and committed are keys to building long-term financial wealth. Stay the course with your retirement contributions.
Be ready for the next time
A common phrase in Ecclesiastes is, “there is nothing new under the sun.” While COVID-19 is new to us, the financial advice to deal with the fallout of the pandemic is as old as Scripture itself. God knew this difficulty was coming but He’s also provided us with how we are to financially ready ourselves. Making these common-sense financial commitments won’t prevent the next crisis. But if we learn the financial lessons of the coronavirus, we can be better prepared when it eventually arrives.
John Madison is author of “The Steward Plan,” a Certified Public Accountant, and founder of Dayspring Financial Ministry. He earned a Master’s Degree in Personal Financial Planning (MSPFP), the MPAS (Master Planner Advanced Studies), CRPC (Chartered Retirement Planning Counselor) and AWMA (Accredited Wealth Management Advisor) designations. He has been featured in the New York Post, Forbes, Crosswalk, The Christian Post, Charisma Leader, Chicago Tribune, U.S. News and World Report, AARP.com, Bankrate.com, CNBC.com, among many other media outlets. For more information, visit http://www.dayspringfm.com.