The following five financial principles have enriched our lives and made us happier. We wanted to share them with you. By being intentional with our money, we have created financial peace in our lives.
1. We do not borrow money.
Proverbs 22:7 says ‘The borrower is slave to the lender.’ We made a decision early in our marriage by drawing a line in the sand saying we were never going to borrow money again EVER. When we first got married, we paid off our consumer debt, which was a big Home Equity Line of Credit. Four years later, we made our final payment on our house and became completely debt-free. We knew we never wanted to go back into debt. When we want to buy something now, we save up the money for it. We truly feel like the borrower is slave to the lender and that’s a position we never want to be in with anyone or any company. It has changed the way that we view purchases. When we are saving up for something first before purchasing, we have to really evaluate whether or not it’s worth the money and if we find value in it. When we do finally buy something, we are very intentional with the purchase. We often find more value in what we bought because we were patient enough to save up the money for it before we purchased it.
2. Less is More.
In our journey of getting out of debt (because we didn’t always subscribe to the first principle), we said no to a lot of things and removed unnecessary stuff out of our budget. When we got out of debt, we realized that we had not missed many of those things and only added back in what truly brought value to our lives, which was mainly travel. We realized we were happier with less – less stuff, less clothing, less clutter, less transportation costs (we went down to one car), fewer electronics and gadgets and less house (we downsized and it is much easier to take care of a smaller house). We learned that we did not need nearly as much as we thought to be happy and that more stuff actually stressed us out. We enjoy a life of minimalism and only owning and doing things that matter most to us.
3. Experiences over stuff.
After getting out of debt, our budget definitely shifted from material possessions to experiences. We realized that a bunch of ‘stuff’ did not add value to our lives. Things break, wear out and there is always something bigger and better around the corner. But sharing experiences with each other and others leaves us with memories we will always have. We place a high value on travel and love to explore the world together. We enjoy hanging out with friends, seeing family, training and racing for triathlons and running events, riding our bikes around town and on the trail and going for walks. Some of these things cost money but many do not cost anything at all or very little. Because we are not buying a bunch of stuff we do not need, we are able to find money in our budget (if something does cost) to have these experiences. We also do not have to work all the time to afford a higher lifestyle, so we actually have time in our schedule to experience these things together.
4. Enjoy today…plan for tomorrow.
Do not only live for today. But do not only live for tomorrow either. It is important to do both. We know some people with the motto – “You cannot take it with you” who spend every penny that they have and then some. But where does that get them when, at some point in their life, they do not want to or are unable to work anymore? Or an emergency happens and they do not have the cash to cover it? We also know some people that only live for tomorrow. They save every penny that they make and never have any fun or enjoy life along the way. For us, the goal is not to spend every penny we make nor is it to work all of the time and never have any fun. We try to be intentional about finding a balance between the two. We want to enjoy life now (as it fits into our budget) by being adventurous and spending money on things that bring value to our life. But we also always have an eye on the future and are saving for a rainy day and ultimately a self-defined retirement.
5. Giving is a priority.
We have a budget item that is called ‘giving’. It is actually our first item so we are sure to budget for that before anything else. However, this was not always the case. Before we got married, we would give to a charity if asked. Or we might do a race if it was for a good cause. But it was not anything we did regularly or with consistency and, quite frankly, it probably did not make a whole lot of difference in the small amounts that we randomly gave.
Psalms 24:1 says ‘The earth is the Lord’s, and the fullness thereof’. As we grew in our faith as Christians, we came to the understanding that God owns everything (including money) and we are called to be asset managers with that money. When we realized this, it became a lot easier to give and create room in our budget for it. We were doing what God called us to do with his money. Our goal is to be good stewards. We give to a mixture of things that we care about, are passionate about and feel led to give to. We believe strongly in our church and its mission. We also give to other ‘501c3 charitable/get-to-deduct-them-on-our-taxes’ donations. These are really great because we are investing in an organization that we feel does wonderful things and our money, combined with others’ money, can help them further their mission. But probably our favorite part of giving (probably because we can feel the effects more directly) is our Miscellaneous, typically ‘non-tax deductible’ giving. It allows us to have a direct impact on others by buying them something that they could not (or would not) buy for themselves or giving someone support directly when it is needed. Giving has made us less selfish and it’s actually a lot of fun. It brings joy to our lives.
Living life using these five principles has made our day-to-day financial decisions easier and has ultimately brought peace to our lives.