The Money Talk

Son, I love you too much to not sit you down and have a serious talk about finances. We will have many of these moments as you grow up since financial situations change often. I want to raise you based off the principle of Romans 13:8, "Owe no man anything except to love him." Debt is dumb and, short of a mortgage, should never be an option. If you can't pay cash for it then you can't afford it. I won't ever lend you money but if you ever need some cash, ask me if I want to make an investment. I will invest money in you any day of the week. I will never put you in a situation where you are salve to the lender. Proverbs 22:7 "The rich rule over the poor, and the borrower is slave to the lender." Don't ever think otherwise, debt is never a good option, in fact, it's no option at all. Half of the problem with the American system is that a couple of slow thinking politicians thought that having debt is an acceptable way and the only way to live life. But hey, it wasn't their money so they don't have to experience the slavery that encompasses that debt.

We all make mistakes in life and there is always enough grace to cover for our lapses. That's no reason to run around acting dumb. What Jesus gives us is a better way to live life and yes, it involves giving up the simple pleasures of the immediate flesh and experiencing rewards through perseverance. Good golly it's not going to be easy and the greatest rewards take much discipline and hard work. Luckily God does not exasperate us by setting us up for failure. He gives us a better way to live life because he knows we can succeed at it and ignorance is no excuse. Your dad has to find grace often and the beauty of it is that it allows us to not make the same mistake again. Lessons in failure are often the best teachers for success. Guess what, God promises to give us enough grace, strength, and mercy to deal with those lessons. 2 Cor 12:9  ""My grace is sufficient for you, for my power is made perfect in weakness." Therefore I will boast all the more gladly about my weaknesses, so that Christ's power may rest on me."

So to focus this on money and finances we need to make one thing clear, money is not evil and having lots of money does not make you evil. 1 Tim 6:10 "For the love of money is a root of all kinds of evil. Some people, eager for money, have wandered from the faith and pierced themselves with many griefs." The love of money is what will cause evil to grow inside you. Being generous is impossible if you don't have any money. We are also expected to be wise with what is given to us, including money, talent, and time. Holy cow is there some much in the bible about this particular topic. Bottom line is that when you are trusted with things you have to rise up and produce greatness from that. I sure does take diligence but nothing worth doing has ever come easy. Brush up on your steward'ness here http://www.openbible.info/topics/being_a_good_steward

So here is my advice to you to help you start off right in your youth. First off debt is not a part of your language, you don't understand why it exist and don't want any part of it. Then, every dollar you earn or are given has a goal, I literally mean EVERY dollar. These goals will be targeted at investing and saving in your youth. Time is the greatest multiplier of your money, it's the magic of compound interest (the second greatest force in the universe). Save the wish list of toys you want for your birthday and Christmas. In your youth you will not need to buy your toys or even really consider spending on those. Trust me, the toys you can buy by the time you are 20 will be way cooler than any money you spend in your youth. That is where the discipline part comes in. It's going to be hard to not let your impulses control you in your youth but discipline in your youth leads to easy habits to follow when you get older. You won't need more than $1000 in cash savings in your youth. Once you have that, invest every last dollar you ever get until you move out of the house. You'll likely want to buy a car when you can drive, start planning around 14 to save up to pay cash for something cheap by the time you can drive. You shouldn't have a car that is worth more than $5000 in high school. The more expensive your car, the more money you will pay in insurance. I'll provide an example for you. Lets just say you put $500 a month ($6,000 a year) into investments a month, I am averaging this amount out from what you are likely to earn from 1-20, If you take that you will have over $1,000,000 by age 25. If you keep contributing that small amount, which you will be making more as you get older, you'll have 6 million dollars by the time you are 40, and you will have only paid $240,000 that's more than 90% in interest. And to add the last figure for you, by the time you retire at 65, if you never contributed more than 500 a month, you would have over $100,000,000 to retire on. The simple facts are that time is on your side, use it well, don't do debt, and be generous.

Love,
Dad