Recently I read two interesting books about personal finances. Each developed a single point from which all managers of the Master’s money can profit.
On the saving and investing side of things, David Bach’s The Automatic Millionaire said that saving for the future must be automatic, not sporadic. That’s how house mortgages work, your biggest investment. That’s why you want to instruct your bank or employer to set a specific sum aside on a regular basis. The sooner you start this automatic savings strategy, the better, thanks to the principle of compounding interest.
At the risk of being too transparent, let me illustrate from my own life the blessing of the “automatic” approach that Bach’s book promotes.
The leadership of our first church insisted that we live in the parsonage. We wanted to start building equity, so we bought a cottage and made room in our budget for automatic mortgage payments. As we moved from a manse in Orillia to a campus ministry-owned house in London, we focused on paying off our cottage. Home ownership in St. Catharines and Courtice meant more automatic mortgage payments. When the Christian education years were done, we set up automatic monthly deposits with an investment firm and adjusted our living expenses accordingly. In retrospect, these monthly automatic withdrawals – cottage, house, investment – and the Lord, of course, helped us achieve our modest financial goals.
This automatic approach worked so well that we applied it to our giving. Pre-authorized debits look after our favourite causes and Hope Fellowship’s budget. We live off the remainder without stress or guilt because our priorities are looked after automatically.
On the spending side, Jeff Yeager’s book, How To Retire The Cheapskate Way is a fun read. This book is not about making more but spending less while living simply and contentedly on the money you already have, something we already learned as poor students in Grand Rapids.
Let me illustrate Yeager’s “cheapskate” way of life with two personal examples.
Several years ago we were frustrated by another increase in our Bell bill. So we replaced our satellite with an HD antenna and adjusted to a handful of channels that bring us every major network, TVO and PBS. Today we watch TV for free.
Our car is doing well with 365,000 kilometres on the odometer. We have an eye on a new model coming out this spring. But we hope our Vibe will survive one more winter while our next car depreciates for a year. In the meantime we’ll keep driving the cheapest car on the market, the one we own outright.
So here’s my advice whether you’re just starting out, thinking about retirement like us, or somewhere in between or beyond. Make your saving and giving automatic; spend less than you earn. It worked for us. It should work for you. Continue these practices after you retire and you’ll be fine.
As for Bach and Yeager’s books, it won’t surprise you to hear that I didn’t buy them. I borrowed the first ($8.19 on Amazon) from my daughter and I borrowed the second from the library ($12.27 on Amazon). That was $20.46 plus shipping that I didn’t spend!
What would Jesus think about the “automatic” and “cheapskate” way of life that these two books extol? After he fed thousands, he told the disciples to “Gather up the leftover fragments so that nothing will be lost.” Why? So that it could be used for others.
Which tells me that frugality does not mean being miserly with the Master’s money. If anything, the automatic cheapskate way of life creates the opportunity to be more generous.
- Pastor Peter
On the saving and investing side of things, David Bach’s The Automatic Millionaire said that saving for the future must be automatic, not sporadic. That’s how house mortgages work, your biggest investment. That’s why you want to instruct your bank or employer to set a specific sum aside on a regular basis. The sooner you start this automatic savings strategy, the better, thanks to the principle of compounding interest.
At the risk of being too transparent, let me illustrate from my own life the blessing of the “automatic” approach that Bach’s book promotes.
The leadership of our first church insisted that we live in the parsonage. We wanted to start building equity, so we bought a cottage and made room in our budget for automatic mortgage payments. As we moved from a manse in Orillia to a campus ministry-owned house in London, we focused on paying off our cottage. Home ownership in St. Catharines and Courtice meant more automatic mortgage payments. When the Christian education years were done, we set up automatic monthly deposits with an investment firm and adjusted our living expenses accordingly. In retrospect, these monthly automatic withdrawals – cottage, house, investment – and the Lord, of course, helped us achieve our modest financial goals.
This automatic approach worked so well that we applied it to our giving. Pre-authorized debits look after our favourite causes and Hope Fellowship’s budget. We live off the remainder without stress or guilt because our priorities are looked after automatically.
On the spending side, Jeff Yeager’s book, How To Retire The Cheapskate Way is a fun read. This book is not about making more but spending less while living simply and contentedly on the money you already have, something we already learned as poor students in Grand Rapids.
Let me illustrate Yeager’s “cheapskate” way of life with two personal examples.
Several years ago we were frustrated by another increase in our Bell bill. So we replaced our satellite with an HD antenna and adjusted to a handful of channels that bring us every major network, TVO and PBS. Today we watch TV for free.
Our car is doing well with 365,000 kilometres on the odometer. We have an eye on a new model coming out this spring. But we hope our Vibe will survive one more winter while our next car depreciates for a year. In the meantime we’ll keep driving the cheapest car on the market, the one we own outright.
So here’s my advice whether you’re just starting out, thinking about retirement like us, or somewhere in between or beyond. Make your saving and giving automatic; spend less than you earn. It worked for us. It should work for you. Continue these practices after you retire and you’ll be fine.
As for Bach and Yeager’s books, it won’t surprise you to hear that I didn’t buy them. I borrowed the first ($8.19 on Amazon) from my daughter and I borrowed the second from the library ($12.27 on Amazon). That was $20.46 plus shipping that I didn’t spend!
What would Jesus think about the “automatic” and “cheapskate” way of life that these two books extol? After he fed thousands, he told the disciples to “Gather up the leftover fragments so that nothing will be lost.” Why? So that it could be used for others.
Which tells me that frugality does not mean being miserly with the Master’s money. If anything, the automatic cheapskate way of life creates the opportunity to be more generous.
- Pastor Peter
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