Home Finances in a Time of Crisis

What should we do regarding our finances in difficult times? In today's Ask the Expert, Senior Director of Advancement Dr. Rick Bee combines financial expertise with Biblical wisdom to encourage financial planning amidst economic uncertainty.

The current crisis of COVID has left many reeling.  Working from home, a significant drop in retirement funds, shortages in the grocery stores, mixed messages from the government and media, and for some even a furlough or loss of employment have left many in a surreal place of uncertainty, fear and panic.

However, if we can step back and examine the circumstances surrounding the world in which we live, we know that none of this is surprising to our Lord.  His promise to us is that He will be faithful, and He will provide. One of my favorite passages of hope is Matthew 6:28-34.  Verse 31-33 says:

“Do not worry then saying, What will we eat? or What will we drink? Or What will we wear for clothing?”  For the Gentiles eagerly seek all these things; for your heavenly Father knows that you need all these things.  But seek first His Kingdom and His righteousness, and all these things will be added to you!”  

Wow, what a unique perspective, and counterintuitive to this World’s response to every crisis!

So, what should we do regarding our finances in difficult times? The first step is talking about it and looking realistically at your budget.  Examine what has changed and what will change, and begin to plan accordingly.  Lost or reduced income will probably demand that you reduce spending.  Is future income in question?  Then it is probably time to take a hard look at any new expenses and how you are spending money now to prepare for difficult times later.  Which by the way is not a bad strategy for life.  (Read Genesis 41!). Will you receive a stimulus check?  You should consider what might be the best investment of the stimulus money to prepare you for the times ahead, and that’s probably not a new big screen TV!

Going out to eat, cable TV, dry cleaning, gym memberships, Disneyland Passes (okay, now we are getting serious!) are all great things when you can budget for them, but in challenging financial times they may not be the smart or right things to do. If you don’t live on a budget, perhaps now is the best time to find a good budget design and incorporate it into your family’s finances. Mint.com is one I have used with my classes, but there are many other programs that can help structure your finances and spending.  

Tracking your spending by keeping a small expense log of everything you buy can give you a clearer perspective on where your money is going and help you discuss and plan for the future.  Record everything for a few months until you see the patterns develop on where you are spending money, then consider how these expenses might be reduced, shifted, or dropped altogether.

As you create your budget, remember that there are really only three uses of money in any budget.  They are, Spending, Saving, or Sharing.  That’s it!  And when income is reduced, these are the three categories that will need to be considered.  These are the three categories you should talk about as a family.  

Many of my students don’t have consistent incomes and I encourage them to take a hard look at the spending category.  How can they reduce spending to live within a budget?  How can they continue to save for their futures little by little?  Getting in the habit and staying in the habit of saving, even when times are tough, can significantly help prepare for the future.  And, most importantly, I encourage them to not stop giving even when times are tough.  

Remember, giving doesn’t mean only financially!  God has gifted each of us with time, talents, and treasures!  Perhaps in difficult financial times such as these, your giving may actually grow in the categories of time and talents.  Perhaps you are a good seamstress or a great cook.  You can use those gifts by sewing a face mask or preparing a meal for seniors unable to leave their home.  Perhaps your talents include encouragement.  You can call someone to encourage and pray for them.  Don’t stop giving, just because your finances are tight!  These are all gifts that have extreme value in every season.

If your particular situation is overwhelming, I would also encourage you to not go it alone.  In our culture many have few advisors and confidants.  And this season of “shelter at home” can leave us feeling alone and lost.  But seek out someone with wisdom and knowledge who can help you strategize for today and plan for the future. A Certified Financial Planner or Kingdom Advisors can provide wisdom in finances.  There are also many good resources available to read.  Authors Randy Alcorn, Ron Blue or Dave Ramsey can provide great wisdom and resources in difficult financial circumstances.  Perhaps, even as a family, read about and discuss what it means to be faithful stewards of what God has entrusted to you.

My prayer today for you is that you will come out of this difficult season stronger as a person, more connected as a family, and closer to the God who loves and cares for you more than you can even imagine.  May our God protect you and give you great wisdom and skill in the days to come.