If your boss offered you a raise you wouldn't look at her and say, "Nah, I'm good. I really don't need any more money."
Instead, the second the "r" word echoed off her lips you would immediately think about whether or not it is socially acceptable to break out in your favorite dance moves.
Raises, promotion, and an increase to your good ole' wallet is something all hard-working employees desire. Our happiness and livelihood can unfortunately come to depend solely on the chase of the elusive dollar. We prove it by our constant go to saying -- "If only I had more money..."
I literally felt that collective pause in your breathe when you read that! Hey, at some point in our lives we've all said it.
We have even justified our financial lack to why we couldn't do things.
"I don't have enough money to pay off my debt."
"I don't have enough money to go on vacation."
"I don't have enough money to start a retirement fund or save."
So, we work hard and patiently wait for more. Naturally, the more we have the better we'll be ... right?
Not so fast.
Our financial journey has been a big part of our lives. We recently wrote about it. I never woke up one day and decided I would passionately protect and handle my finances. It didn't say, "intense budgeter" as my future life aspirations in the my high school yearbook.
Instead, it happened naturally. I received my first paycheck of $180 and opened up Microsoft Word and told the $180 how I wanted it to be broken down. The same system I do today. It's the same system that attributed to us paying off over $70,000 in debt in 4.5 years.
I've had the experience to meet with a lot of individuals on budgeting. It's likely the top reason people pursue to meet with me -- yes, even over other pastoral engagements. Throughout the many money-centered conversations, there's always one resounding statement: "If only I had more money..."
However, more money doesn't necessarily change anything. In fact, let's talk about a few myths.
Myth 1 - If I had more money, I would be happier.
This statement is the most heartbreaking. It's the reason people change jobs and move families. It's the perception that the "grass is greener." The reality is in the pursuit of more money we're stunned when our life isn't better even with a financial increase.
Unfortunately, this scenario plays out regularly where we live. Living in South Louisiana our main industry is oil and gas. It's very common for husbands to work intense off-shore schedules as they attempt to capitalize on the money when the industry is booming. This results in longer hours and less time with families.
So, while they are more than able to provide for their family, they lack quality family time. With the lack of quality time usually comes tension points in their marriage and a disconnect from their children.
For the first time in a while, a good friend of mine was living comfortably with his off-shore job. However, he couldn't justify the money with his lack of quality family time. So, he recently took a significant pay cut to take a job where he was home every day at 5 PM. He's happier now with less money than before.
In our never-ending quest for more we think more money will cover our our areas of discontentment. An increase in money will not make you and your spouse have a better marriage. It won't make you become a better parent because "now you can do more." It won't make you a better follower of Christ.
Money is an easy way to excuse our feelings. We throw "if only's" out there because it's a cheap way of differing current responsibility for your dissatisfaction with life. Don't believe the lie that one day life (family, job, friends) will get better when you make more money.
Myth 2 - If I had more money, I would handle it better.
If you can't manage $100 a week -- you won't be able to manage $500 a week. More money doesn't automatically make you better at handling money.
I love this quote by Dave Ramsey. He mentions a similar example in regards to parenting:
“Having children doesn’t (automatically) make you a good parent; it means you had sex. That’s all.”
For our translation today: Just because you have more money doesn't automatically make you a great budgeter or manager. It just means you got a raise.
Here's what happens when you someone who struggles managing money receives more. Let me explain with these graphics:
Let's say you make $500 a week. Admittedly, you don't have a budget or financial strategy. The red is your expenses. This covers the cost required for your lifestyle. EX: house, car, food, entertainment, insurances, phones, etc.
The blue is margin. Margin is the area you create in your budget after expenses. The margin may include: giving, vacation, savings, accelerated debt payoff, retirement, etc.
As you can see, the expenses are the large majority of your salary.
Good news -- you got a raise!
Now you make $1,000 a week. That's not just significant change. That's a life-changing increase. Unfortunately, you still haven't budgeted your income and you don't have a strategy.
Notice that nothing changes. Theoretically, there is a $500 increase every week. However, in most cases, people (without even realizing) increase their expenses. Maybe you get a new car, a better house or apartment, or you eat out more because the checking account shows more money.
You have more. So you spend more. The margin area stays small -- thus you can never get ahead.
In this image, we look at someone who has good budgeting and financial practices. With the raise, you're way of living stays the same. You don't add any new expenses. You've now created a large gap of margin.
Now you can have focused intentionality with your margin. You can choose where your money goes -- it's not arrested by expenses. You can give more, save more, or -- one of my favorites -- pay off debt quicker.
I'm convinced -- in most cases -- you don't need more. You need to manage what you have to see the big financial picture. Believe it or not -- we can live off a lot less than what we think.
Myth 3 - If I had more money, I would give more.
Whether you have a church connection or not, most of us want to give back. For those specifically in a church setting, we feel the desire to give more strongly due to the very nature of God and His expectation for us financially.
Robert Morris, pastor of Gateway Church, so effectively communicates in his series, The Blessed Life, that our hearts are connected to our money. Point blank. Want to see what we value financially? Check our checking account or budgets.
Like with myth two, it's naive to believe that someone who isn't generous with their money now will automatically become generous with a financial increase.
We've all had the compassionate urge to help someone in need, to give to a hurting child in another country, to a non-profit organization like a local church, or to an animal shelter, but instead have easily said, "if I had more, I would."
This conversation (and myth) is solely connected back to margin. If your expenses are taking up all your available income, you literally can't afford to give. But, once we manage our money better, we notice the margin widens and creates space for us to live generously.
But, with no strategy or plan, being able to give is just wishful thinking. Contrary to what you think, more money will not make you automatically generous. Why? If you spend all your money now ... you will spend all your money even with more of it.
You've got to prepare!
Kayla and I are big Disney people. We try to go every year. It's one of the only places we've found where we can totally disconnect from the world and be ok with it.
To successfully go to Disney World you need one thing. Preparation! Ha! Gotcha. How many of you thought money? Well ... you do need that as well.
The amount of preparation you put into Disney will show in the amount of fun you have. The more you prepare, the more knowledge you have. At this point in our Disney trips, we know how to save the most money, we know the best restaurants, and we know how to manipulate the Disney Experience app and Fast Pass system where we never wait for a ride more than 20 minutes.
The people who go to Disney and hate it are those who don't prepare. If you don't believe me, go read the one star Facebook reviews on their page. These vacationeers think they'll magically (pun intended) have a great time simply by showing up without preparing.
If you don't have a plan in Disney, you will not have fun. Period. If you don't have a plan for your money, you will never get ahead no matter how much you have.
So, contrary to popular belief, you don't need more money. You simply need to manage it.
If my lifestyle supersedes my current income -- I'm living beyond my means. If my mortgage note is so large I need a raise to afford it -- I'm living beyond my means. If my money is so tight right now I'm hoping for a raise to buy a new car -- I'm living beyond my means.
If I need to take out of savings to pay bills or survive, I'm living beyond my means.
Transparently here, let me say this. If Kayla and I don't make $1 more a year for the rest of our lives, we are 100 percent confident in our ability to enjoy life and raise a family comfortably. No, we're not rich. In fact our household income is about 30% less than the U.S. average.
This question will give us a good starting point -- could you say the same? If you're current household salary stayed the same for the rest of your life would you be satisfied with your margin to expenses ratio?
If the answer is no, you are living above your current financial means and action is needed.
So, how do we move forward? That varies. The best way to start is by writing all of your expenses/income down. Everything. Most people I talk with don't even realize what they are spending their money on. What's your margin from your income to expenses?
Depending on what you see, it's going to require action. It may mean cutting back. For those wanting to increase their margin, you may be an avid Hulu watcher smiling while you're save $100-200 a month on cable. You might trade in your fun unlimited data plan for a 3 GB plan. You may bring your lunch to work -- and see yourself save $200 a month.
For others -- it's a bigger sacrifice, like selling a vehicle or downsizing a house just to cut back on the expenses you've incurred.
For those already with great margin, you need a system to track with an intentional plan for your money. In other words -- start a budget.
Regardless of where you fall -- something is most certainly better than nothing. The answer to your financial situation is likely already in your checking account waiting to be partnered with good management habits.