I'm not sure when I bought my first personal finance or stewardship book. I think my first exposure as a young Christian was through Larry Burkett and Christian Financial Concepts, which he founded in 1976.
That ministry merged with a well-known Christian stewardship ministry, Crown Ministries, in 2000 and became Crown Financial Ministries. Larry Burkett was the CEO until his passing, but Crown continues to use the same basic concepts Burkett taught throughout his life.
I read several of Burkett's books. At some point, I read Master Your Money by Ron Blue, which was first published in 1986. I also attended a " homegrown" stewardship class in my church in the late 90s, which further inspired me to get my finances in order. My interest in the subject, and a desire to help others, eventually led to me joining the financial counseling team in my church (which I now lead).
I was also exposed to Dave Ramsey and his radio show and books through Financial Peace University (and subsequently became an FPU coordinator and then attended his financial coach "master class.") You may not know that Dave says he was greatly influenced by Larry Burkett and credits much of his early work on FPU to the principles Larry taught.
As I progressed in my career, which was in financial services (banking)—though I wasn't a financial professional, I was in Information Technology (IT)—I realized the need to increase my focus on saving and investing for retirement.
Over the years, I started reading books and blogs about investing and other personal finance and retirement topics. I was intrigued by the idea of learning from people who were working through the same kinds of things I was. Over time, I learned some surprising things about retirement planning in general.
First, I found that, although many people find the subject boring (and I understand why they would), it was fascinating to me. For example, how all the different variables and risk factors enter into the critical financial decisions we all have to make. I guess I naturally gravitated toward the technical aspects, but I also realized that developing a biblically-informed and God-inspired vision of retirement was equally, if not more, important. (I write about that on this blog, and it was the basis for my first book, Reimagine Retirement: Planning and Living for the Glory of God.)
Second, the fundamental principles and practices of wise stewardship are simple and easy to understand, but they can be hard to implement. For example, choosing a few good mutual funds or ETFs to invest in but then not pulling out your money when the going gets tough or chasing a so-called "better return" from the hottest new thing.
Third, which wasn't that big of a surprise, was that although everyone needs to do it, most people don't. For example, according to Ramsey Solutions, "54% of Baby Boomers still in the workforce have less than $25,000 saved for retirement. Of that group, more than half have no retirement savings at all."
These things inspired me to want to help others, first by coaching and counseling and leading stewardship classes at my church, and more recently by also writing about them on this blog and in my books.
3 Big Things
I've learned a lot, mostly through experience and self-education, and I have come across many different situations since I started coaching, counseling, and, more recently, writing about retirement stewardship. When I wrote Redeeming Retirement, there were three "big things" that I've learned that guided my approach to the book:
1. Personal finance in general, and retirement planning in particular, are at once very simple and very complex.
When my kids were young, and I would drop them off at school, I had a "code word" I liked to say to them each day: "BGWHHF." They knew what it meant, and in many ways, it's my simple philosophy of work and school: "be good, work hard, have fun."
That little sentence is very simple, but we know that achieving long-term success at work or school is a much more complex problem.
Dave Ramsey often says personal finance and stewardship are simple, so he teaches others to do things the way grandma used to do. (I'm sure that many of us have had grandparents who could explain everything we needed to know about handing money.)
I wrote an article about a book written a few years ago by a University of Chicago college professor named Harold Pollack, who claimed that everything you needed to know about personal finance could be fit on a single 3×5 inch index card. Other books, such as Napkin Finance: Build Your Wealth in Thirty Seconds or Less, The One-Page Financial Plan, and Simple Money also extol the simplicity of personal finance.
I agree that the basics of financial stewardship are simple and easy to understand. Here's my list (I could also put them on a napkin or an index card):
- live below your means
- save consistently
- invest wisely
- avoid unnecessary debt
- purchase adequate insurance protection
- maintain an emergency fund
- buy a home and then pay off the mortgage
- make generosity part of your plan
There's nothing fancy or sophisticated about saving, investing, and giving. If you do these things for most of your adult life, there's a near mathematical certainty that you'll be able to "retire with dignity"—with enough money to live comfortably and support your family without being unnecessarily dependent on others.
The complexity comes in the context of individual lives and circumstances, with all the different factors and variables and emotions involved in any specific situation.
Retirement stewardship involves a detailed process involving decisions about your financial requirements once you stop working and ensuring you have sufficient funds to meet those needs for as long as you live. You have to consider numerous factors such as lifestyle, longevity, available income sources, assets level, overall health, inflation, and portfolio returns.
In my new book, Redeeming Retirement, I try to simplify these calculations and help you apply them to your situation. The retirement planning process is a very personal one, as everyone's needs and circumstances are different.
2. Many people believe that "the math" is their main problem and therefore look for solutions in the wrong places.
The mathematics of basic retirement planning (such as a "savings withdrawal rate") are mostly simple to comprehend and apply. And math is vital to the retirement planning process I alluded to above. I use math quite a bit in the book and even joke that MATH stands for "Mental Abuse To Humans" because it can be a little confusing and laborious at times.
I try to use mathematics in a purposeful and structured way while also keeping things as simple as possible. Most importantly, I wanted to show that doing some math is critical to developing a sound retirement plan. (I admit that this book is much more math-intensive than my earlier books and is more like some of my blog posts.)
The problem with math is that some people tend to approach personal financial situations and problems by looking for a mathematical solution. They look for ways to pick up an extra 0.25% of interest, pursue sophisticated hedged or leveraged investing strategies to "juice" returns, sign-up for low or 0% loans or credit cards, or examine various lower-interest debt consolidation strategies to see if that's the answer to their financial problems.
In other words, they look for sophisticated answers to problems that doing the relatively simple things I listed above might have prevented.
Math isn't the problem, and it can be helpful to better define our goals and objectives and our ability to meet them. Our problem tends to be one of behavior.
For most people (there are always exceptions), their current financial situation results from a complex web of background, education, training, experience, and choices that got them to that point. But if they need to have a different result in the future—be it 5, 10, or 20 years down the road—they have to change things by making different choices.
As I point out in Redeeming Retirement, the choices are simple but not necessarily easy to implement. If you try to find a shortcut, you're going to be disappointed. A single big play in the stock market probably won't do it, nor will jumping on the "Bitcoin" wave or investing in your brother-in-law's sure-fire new business scheme. It's better to continue working hard, making as decent an income as you can without becoming a workaholic, saving diligently, and investing wisely.
Doing the "simple things" isn't exciting; it's downright boring. Yet, most people who retire with sufficient resources to fund it steadily save and invest in good, low-cost mutual funds or ETFs for 20, 30, or 40 years. No bitcoin. No amazing stock picks. Just steadily investing and letting compound growth work its "magic" over time.
3. Many people view personal finances as an "off-limits" subject not to be discussed with others, and sometimes, not even with their spouses.
I mentioned Dave Ramsey and FPU early in this article. One of the big "ah-ha" moments for me after going through FPU for the first time many years ago was that I had not sufficiently involved my wife in my budgeting, planning, and investing decisions. (You may remember the "Nerds and Free-Spirits Unite" class in the original FPU curriculum. I imagine you can guess who is which in our house.)
So, I decided to make significant changes in that area. I still remember the first time we sat down (I think it was a Saturday afternoon) and had our "budget planning meeting" to get her input on every line item of our spending budget. I'm not sure, but I think the meeting lasted several hours, not because it was contentious, but because there were so many things we hadn't talked about before. We finished in a much better place.
Since then, I have tried to involve her in other areas of our financial lives, especially retirement planning. That included helping her to understand our investments—what we are invested in and why. I also maintain a document titled "A Letter from Your Husband Who is Now in Heaven" containing detailed information on all of our financial affairs and other essential details she and my family would need if I were to die or be completely incapacitated.
I am also surprised how often I encounter couples who have money problems and discover that they don't communicate about their finances, nor do they share their struggles with others. One of the things I liked about FPU was the small group discussions. It gave people an opportunity to open up a little about their finances, perhaps for the first time.
Another observation I've made is that people are reluctant to ask for help, especially if they have big financial problems. Perhaps that'd due to embarrassment or shame, or just a deeply-held belief that financials are personal and therefore private.
I've coached quite a few people on the doorstep of retirement and have a ton of questions or concerns. On more than one occasion, after I learn more about their situation, I ask myself (not usually them), "why didn't you ask me these questions X years ago?".
It's more of a rhetorical question as I know why: It's an uncomfortable subject, and most people would prefer not to discuss it. And even if they do, they'd rather talk about it in generalities (the current stock market, the price of gas, the possibility of higher taxes, etc.).
I wrote Redeeming Retirement being acutely aware that being behind saving for retirement can be an emotionally charged problem. So, I try to help people understand the specifics of their situation and how their emotions play into it. I also want to help the reader get past any fear and/or regret they're feeling so that they can focus on solving the problem rather than just feeling bad about it.
Thankful and Hopeful
I'll always be thankful to the "fathers" of biblical stewardship, men like Alcorn, Burkett, Bentley, Blue, Ramsey, and others. I'm also grateful to the many folks I have counseled or coach over the years for helping me understand the simplicity of numbers and math and the complexity of personal finance.
I didn't figure out my finances (or get ready to retire) overnight. It was a process that took many years. And no matter what your total net worth or level of retirement preparedness, one thing is true of all of us: none of us have it all figured out. No matter how hard we try, we can never achieve absolute certainty.
But that's okay as long as we approach this subject with a healthy dose of humility and work to keep learning and growing in our knowledge and actions while ultimately putting our faith, trust, and hope in God for our future.
If you think you would benefit from my new book, Redeeming Retirement, I hope you buy it. That's not because I will make a bunch of money if you do (I probably won't sell enough to recover my self-publishing costs, let alone the 1,000-plus hours I spent writing it), but because I sincerely believe it can help you.