Making Your List, Checking Your Budget Twice

How do you manage your money around the holidays? In today's podcast, Dr. Chris Grace, Alisa Grace, and guest Rick Bee discuss tips for Christmas budgeting and communicating about finances to ensure you and your spouse are on the same page when it comes to spending and financial planning. 

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Mandy:    Welcome to another Art of Relationships Podcast. We are grateful for listeners like you. Let's get right into it.

Chris Grace:    Well, it's good to be back for another podcast, [Lise]. It's really fun when we start to have guests come on the program, isn't it?

Alisa Grace:    I love it. It just livens it up a little bit.

Chris Grace:    Yeah. And I think part of the reason why we love doing this is because we get to hear from people who are really good at what they do, and today's guest is no exception. So Lise, why don't you introduce Rick?

Alisa Grace:    Well, we have as our guest today, Dr. Rick B. He's been a frequent blogger for us actually on the topic of money. And in fact, I think we've even had you in here to do a podcast before Rick isn't that right?

Dr. Rick B.:    It's been a while, yeah. Yeah.

Alisa Grace:    It has been a while. So it was time to get you back. But, Rick is a Senior Director of Foundation Relations and Capital Projects here at Biola University. And he even taught a really popular class at Talbot School of Theology called Faith and Money. So in that class, you really helped students learn how to manage their debt, get out of debt.

Dr. Rick B.:    That's exactly, yup.

Alisa Grace:    And so, we really wanted to talk to you today about that.

Chris Grace:    To help us get out of debt. Not only we, but yeah. It's just, it's been rough.

Dr. Rick B.:    We can talk about students, but it really is us. That's the bottom line.

Alisa Grace:    It is. And especially right now, because this is November, and we are heading into the holidays where money can be a big issue for couples.

Chris Grace:    Yeah. Couples, I think frequently ... And Rick, we're going to ask you a couple questions about that, but it starts this November, December season, right?

Dr. Rick B.:    Mm-hmm (affirmative).

Chris Grace:    Where holidays, family travel, all of these things come about. And so I think we'd love to hear, maybe just tell us how you got started in this. Maybe even your own journey that, an experience with money. And I know you've got stories like that.

Dr. Rick B.:    Yeah, I do. I do. It's a topic that is so close to home as I've taught class through the years. So many of our Biola students are carrying just crazy debt. And you talk to them, and they've got ... Average debt now is about $38,000 for a student.

Alisa Grace:    Oo! Wow.

Dr. Rick B.:    But I've had students in class with $200,000 of college debt. And they want to go on the mission field or they want to go into the mission as a pastor, or a missionary. And you just, your heart breaks for them because you know, that that debt will keep them from doing what God has called them to do. And I think that's where my passion for this topic has surfaced for students.

    But so many of my students call me back years later and they say, "Hey, I'm going through this." Or, "I'm going through that. And I've got life decisions to make about buying a house or buying a car. How do I do that? How do I do that and not become dead encumbered?" And I think that's why this whole topic is so close to my heart.

Chris Grace:    Yeah. And so for you, you've not just lived this life for a while. You not only been in this field for a long time, I know, and you raised children this way. What started for you, and has it ever been an issue this topic with you and Julie?

Dr. Rick B.:    Oh, sure. Yeah, yeah.

Chris Grace:    Yeah.

Dr. Rick B.:    Well, and God puts us together in interesting ways. Because so often we have a spender and a saver in the same family. Right?

Alisa Grace:    Really?

Dr. Rick B.:    And I'm not going to ask, but I might. Who's who's who in your family?

Chris Grace:    Well I don't ... What do you think? I mean, you can guess.

Dr. Rick B.:    Yeah. Yeah.

Alisa Grace:    Yeah. You guess.

Dr. Rick B.:    No, I'm not even going to go there.

Chris Grace:    No.

Dr. Rick B.:    If you're like us, I am the spender and Julie is the saver.

Chris Grace:    Oh.

Alisa Grace:    All right. You are my compatriot.

Dr. Rick B.:    There you go.

Chris Grace:    Yup.

Alisa Grace:    I'm the spender.

Dr. Rick B.:    And I've called ... And I'll do this, if Julie was sitting in the room, I would say this, so I don't hesitate. She's the dream killer, right? Because I'll have something that I really, really would like to do, invest in a property or something. And Julie is reality. She's the dose of reality for us. And God, I think puts us together balanced like that.

Alisa Grace:    Yeah.

Dr. Rick B.:    But challenge is, because we're coming from two different perspectives, especially November, October, November, December, January, those months are very difficult. Because one could want to buy a lot of Christmas presents, and one's more concerned about the bank account.

Alisa Grace:    Mm-hmm (affirmative).

Dr. Rick B.:    So it's something I see quite frequently in families.

Alisa Grace:    It reminds me that there was a poll that just came out in October from Gallup. And they found that Americans plan to shell out ... Well, just guess. What would you guess is the average amount that Americans are planning to spend this Christmas?

Dr. Rick B.:    I would guess several thousand dollars. I don't know.

Alisa Grace:    Yeah. What do you ... Did you already see it, Chris?

Chris Grace:    No, I didn't see it at all. I think it was like $942.

Alisa Grace:    It is.

Dr. Rick B.:    Was it, really?

Alisa Grace:    $942.

Chris Grace:    Yeah.

Dr. Rick B.:    Oh wow.

Chris Grace:    That was a good guess.

Alisa Grace:    I think last year it was almost $900 as well. But 37% of those people that they surveyed, expect their gift tab to seed $1,000.

Dr. Rick B.:    Yeah. I believe that.

Alisa Grace:    Yeah.

Dr. Rick B.:    And I think it's even higher in Orange County where I live. LA county's probably just about as high.

Chris Grace:    Yeah.

Alisa Grace:    That's crazy. That's crazy. I think when Chris and I were early married, money was such a big, it was a big deal because we didn't have any, basically.

Dr. Rick B.:    Mm-hmm (affirmative).

Alisa Grace:    And one of our biggest fights each year would be about Christmas money. Remember that, Chris?

Chris Grace:    Mm-hmm (affirmative). Yeah. Yeah I do. How could I forget? No, it was always about, one of our family members would give us at that time, an exorbitant amount of money, $100 each. And you're like, "Oh my gosh, I have $100." And that's what I would think is ... That's what Alisa would think, that she has $100, and that I had $100. And that's was wrong, because really what it was, was we both together have $200 to pay for bills, and to pay for smart things.

Alisa Grace:    No, no, no, no, no.

Chris Grace:    Yeah. Alisa was like, "No, this is my $100, that's your $100. You could spend it how you want. I spend it, how I want." And it was just this different view, Rick, that this was either ours to go toward debt or bills, or no, "This is a special moment."

Dr. Rick B.:    Yeah.

Chris Grace:    And what I learned later on is that, while Alisa's a spender, she also waited for that moment. She knew it was coming at Christmas.

Dr. Rick B.:    Mm-hmm (affirmative).

Chris Grace:    She knew the $100. She would not spend a certain amount knowing that she would get that. And here I was kind of killing the dream by saying, "Wait, what are you doing spending our money." And it becomes a problem.

Dr. Rick B.:    Yeah. Yeah. I think you're absolutely right. And I think my first recommendation for families over Christmas, is to talk about it. It's the bottom line. "What are your expectations for Christmas? What are your expectations as a family in your finances?" And that open communication can eliminate a lot of frustration.

Chris Grace:    Mm-hmm (affirmative). So you're a young kid, let's say that is, you're finally out on your own, maybe a young adult I meant. And you're starting off, and your family is always given gifts, but you just don't have a lot.

Dr. Rick B.:    Yeah. Yeah.

Chris Grace:    Rick, when you talk about ... How do you deal with that when you have maybe different levels in your family? I mean, some people can afford these Christmas gifts, others don't.

Dr. Rick B.:    Yeah.

Chris Grace:    What do you recommend when it comes to navigating different ... And is that talking, is that what you mean?

Dr. Rick B.:    Yeah, I think it's communication, but it's also agreeing on what is enough, right? Agreeing on, "What do you expect for this Christmas?"

Chris Grace:    Mm-hmm (affirmative).

Dr. Rick B.:    And I think if you're open and honest, even as a young person, it really will go a long way within a family structure to keep that stress level down. Right?

Chris Grace:    Mm-hmm (affirmative).

Alisa Grace:    So how do you even start that conversation? Let's say that, whether you're just out of school as a young adult, or maybe you're a senior and on a really limited budget. I mean, you're living on social security, paycheck to paycheck, and you've got 30 grandkids. Or maybe you're just a typical married couple that, I mean, it's just hard to stretch that dollar. But here it comes, so how do you even start that conversation? What does that sound like?

Dr. Rick B.:    There's really good resource out there that's come from Generous Giving, an organization called Generous Giving. And I would encourage you to Google them and see what kind of information they have. But they actually have a guideline on family conversations about money over the holidays. And it's a great advisory as how do you start those conversations?

    But I think really a lot of it is just being open and honest about kind of how the budget may be restricted. And I would encourage families to really consider the B word. Budgets. Right? Work through that family budget, and make sure that you've got a Christmas budget and it's built in there.

Chris Grace:    Mm-hmm (affirmative).

Dr. Rick B.:    I think it's a great way to begin to really talk about it as a family.

Chris Grace:    So, Lise, one of the things we find more than anything, this is what arguments that can be pretty powerful and deep. And, we talk with couples, there's arguing about different things. They might worry about family, or they might argue about way you spend time. But money be something that seems to be deeper.

Alisa Grace:    Yeah.

Chris Grace:    And it seems like we find that a lot. Right? I mean, couples are arguing about money, and it's hard to talk about. So Rick, what we worry about is, some of these conversations have been so bad, so negative, so hidden, so ...

Dr. Rick B.:    Unhealthy, yeah.

Chris Grace:    Yeah. And how do you get even started? Do you just simply need to have somebody there, a third party? What do you think?

Dr. Rick B.:    Advice and counsel is always good. If there's someone that's close to you that knows your family, knows the ins and outs, and maybe even knows the dark spots of the family, I think that's a great way to go about getting advice and getting counsel. There are some tools that you can use as a family that begin to kind of open the eyes of everyone.

    One is keeping a spending record. As you go out, keep a little notebook, or look for an app. There's a ton of apps out there now that will help in tracking your spending. And as you begin to track your dollars and where they're going, and I mean every little cappuccino that you buy, I know this is painful guys, but it's really helpful.

Alisa Grace:    He's seeing me wince over here.

Dr. Rick B.:    Yeah.

Alisa Grace:    Ow!

Dr. Rick B.:    If you start to track that money expense, it's going to really make a difference and you'll begin to see some trends. And that will help you outside of even the holidays to know where those dollars are going. And you do it together. If you do it as a family, it's a great way to kind of begin to monitor some of those things. So I encourage, get a little notebook, or go with an app, and begin to do your tracking of your expenses.

Alisa Grace:    Mm-hmm (affirmative). Is there a particular app that you have used or that you know people really like?

Dr. Rick B.:    Various apps, there's a ton of apps out there. And if you, again, if you Google financial control or assistance, you'll see something that comes up that really fits your needs.

Alisa Grace:    Mm-hmm (affirmative).

Dr. Rick B.:    A little notebook does the same thing. But find something that really fits your needs and your family.

Chris Grace:    Rick, when you start to think about, for example, some of the specific advice like you're giving, find an app, track everything, what's your view on, for example, cash versus credit card? Today, it's almost seems weird to me-

Dr. Rick B.:    Absolutely, yeah.

Chris Grace:    ... that you have ... I don't even pull out my credit card anymore or cash.

Dr. Rick B.:    Yeah, yeah.

Chris Grace:    I just tap my phone right on their little receiver. I put my thumbprint in and next thing you know, I'm walking away with food and I haven't even thought about the money or track it.

Dr. Rick B.:    Yeah. Yeah.

Chris Grace:    Now there could be an automatic tracker. Is that old advice still relevant? When they say, "Oh, don't use a credit card, use cash." But who carries that around?

Dr. Rick B.:    Yeah. Dave Ramsey's been hard and fast on that for many years.

Alisa Grace:    Mm-hmm (affirmative).

Dr. Rick B.:    And I'm probably not quite as hard and fast as Dave is, because I think you can use it as a tool. When it becomes dangerous is when you lose that element of control over your credit cards. And I encourage my students, it's the last place you want to spend. You really don't want to put money on a credit card. You really want to try to pay cash. Because if you can't afford to pay cash, you really shouldn't be buying something to begin with. So you want to be careful about how you use credit cards.

Alisa Grace:    Yeah. There's also that element that when you are pulling out your wallet, and you are actually laying those dollar bills down ...

Dr. Rick B.:    Absolutely. You feel it.

Alisa Grace:    That hurts.

Dr. Rick B.:    It's true!

Alisa Grace:    Yeah, it hurts a lot more than just swiping your credit card.

Dr. Rick B.:    Yeah.

Alisa Grace:    I can go through the grocery store line. I mean, I've been in the grocery store shopping for 45 minutes, get my 20 bags of groceries, and I'll have no idea how much I just spent.

Dr. Rick B.:    Mm-hmm (affirmative).

Alisa Grace:    Because I'm just talking, I'm swipe my card, I'm not really paying attention. And I'll have no idea.

Chris Grace:    And that's the stuff of my nightmares.

Dr. Rick B.:    Yeah, I know.

Chris Grace:    I just think, "She has no idea."

Alisa Grace:    I don't! Yeah.

Dr. Rick B.:    And, who pays the bills for you guys?

Chris Grace:    Well, [crosstalk] we kind of have them on automatic payment.

Dr. Rick B.:    Do you? Yeah.

Chris Grace:    And the ones that are not, Alisa does. Which is really helpful. But in general, okay let's talk. Do people still carry cash? Maybe we do because we're a little bit older, but I don't carry cash.

Dr. Rick B.:    Yeah, very yeah.

Alisa Grace:    Or should we?

Chris Grace:    Well, let's just ask the question. Should young people that are just setting up a budget. I mean ...

Dr. Rick B.:    Yeah. I'm not opposed to it. And, you've heard of the envelope system, right?

Chris Grace:    Yeah, right.

Dr. Rick B.:    The same thing can work virtually. You can have certain allocations of funds for certain projects. Certain things you want to buy, groceries, or paying the rent. You want to make sure that you've allocated enough for all of those various envelopes, right, to be successful, even though maybe they're virtual. But I think carrying cash can be a really good thing.

    And you hit on something there, Chris. I think that the old adage of, "How can I be out of money, I still checks?" Is really true, even for credit cards. Because, "I still have a credit limit. Why shouldn't I spend?" Well, you shouldn't because credit cards have the highest interest rate of any kind of loan you can have.

Chris Grace:    Yeah.

Alisa Grace:    Mm-hmm (affirmative).

Chris Grace:    I think what I worry about is, now I could be wrong on this, but does a 18, 19, 21-year-old that we've tried to raise, do they even know what the inside of a bank looks like? I mean, you have a Wells Fargo app, you have a Bank of America app. You just click on it, you take pictures of the ... If you get a check from somebody, you just take a picture of it.

Dr. Rick B.:    Yes, yeah.

Chris Grace:    You don't have to ... Even an ATM, I guess you could go and pull out money that way. But more and more, it's maybe not even understanding the concept of where is this money kept? How is it kept?

Dr. Rick B.:    Absolutely.

Chris Grace:    What are my limits and structures that I have around me? And that's what ...

Dr. Rick B.:    Well, I serve on a credit union board, the Christian Community Credit Union. And the nice thing about a credit union is it's member-owned.

Chris Grace:    Mm-hmm (affirmative).

Dr. Rick B.:    So they are really good at educating their members on the use of their money. Interest rates are usually better at a credit union. There's some things that are beneficial. And one of the programs that our credit union has, is a program to help educate and move you towards healthy use of finances.

Chris Grace:    That's great.

Dr. Rick B.:    And I would encourage, wherever you're banking, maybe check and see if some of the financial institutions have those types of resources. Because it's a great way to kind of especially bringing up the next generation of spenders. Right?

Chris Grace:    I love the way you could set up, for example ... Rick, what you think about this? I will receive a text from the bank every time it hits a limit in a checking account. And if you could set the limit of $50. And how often do I get that text? Well, all the time. And it's because we share one with one of our kids, and my wife and I have one. And all of a sudden, I just get a text says, "You've reached your preset limit of $50. You only have 50 bucks." And I forward that thing all the time to that kid saying, "Hey look." So, that's not a bad idea.

Dr. Rick B.:    No it isn't. It isn't.

Chris Grace:    Because what it does is, it starts to tell you, "Wait a minute, what am I doing? How did I reach there?" If you're not aware of how you reached it, you might need to go back-

Dr. Rick B.:    Absolutely. Right.

Chris Grace:    ... and do checking and planning.

Dr. Rick B.:    And there is so much fraud out there. You really do need to watch your accounts, check your FICO score, make sure that you are on top of your finances.

Alisa Grace:    Mm-hmm (affirmative).

Chris Grace:    Yeah.

Alisa Grace:    Well, as we can start heading into the holidays, Rick, we've talked a little bit about why money can be such a sticking point in a, especially a marriage relationship. But as we're looking to get ready to buy those Christmas gifts, what are some really practical tips that you could give our listeners, and even Chris and me to really help us not only watch our budget, but to actually save money?

Dr. Rick B.:    Great question. I think really, if you begin again as a family, to think of ways that maybe are practical where you can save money at Christmas. If you have a big family, maybe you consider alternatives to buying presents for everyone. I know families that have been really strategic in getting together as a family and saying, "We're going to use those resources this year for a nonprofit. We're going to go serve at a home." Or, "We're going to do something for a family that maybe doesn't have the resources."

Alisa Grace:    Gosh, I love that.

Dr. Rick B.:    It's just as much fun I think, to give as it is to get.

Alisa Grace:    Mm-hmm (affirmative).

Dr. Rick B.:    It's fun to get too. But you got to be strategic. So there may be some ways that you can do that. Again, communication. Maybe you have a family that would like to draw names. We've out as a family for many years. Rather than buy everyone a gift. You draw names and do a bigger gift, a more significant gift, for the person that you draw. I know a lot of families do that.

    Just be creative in how you structure that Christmastime, so that you remember the reason for the season. You know? It's not about what we're doing, it's not about the gifts that we give. It's about the greatest gift that we have been given in our gift of Christ, our savior.

Alisa Grace:    Mm-hmm (affirmative).

Chris Grace:    Sometimes on Christmas, Rick, I think that's such great advice. Because you sit there you're, you're surrounded. This person has given you a gift, your parents have given you a gift, your grandparent's given you a gift. A child's given you a gift. A friend has given you one. Pretty soon, you're open, and you don't even remember who gave you what, and how much.

Dr. Rick B.:    Yeah, yeah.

Chris Grace:    And I think that it kind of forces you, what you just said, to stop and go, "Wait, what are we doing? What is this for?" And "What is this about?"

Dr. Rick B.:    Have you guys ever done the making a gift as a family for one another? Have you ever tried doing that?

Alisa Grace:    Mm-mm (negative).

Dr. Rick B.:    Our family has done that through the years. And I go back to some of the best gifts I've received, have been things that my kids have made, or that we've made for one another. Julie's dad was a great woodworker. And one Christmas, he made for each of the families, a nativity set.

Alisa Grace:    Oh, wow.

Dr. Rick B.:    And it was a puzzle. So that you had the various parts and you put it together. And as a family, with all of us, and there were five or six different families represented, we had a competition. And Julie and I won, I'll just say that right up front. But it was a gift of that ... And this was 25, 30 years ago. It was a gift that comes out every Christmas now. And we remember the fun of having that negativity set competition, right?

Alisa Grace:    What was the competition?

Dr. Rick B.:    It was whoever could put it together. It was a puzzle. So it was whoever could put it together the quickest, I think they got to open their first present. I don't remember what it was.

Alisa Grace:    That sounds really good.

Dr. Rick B.:    But it was great fun. Yeah.

Alisa Grace:    I think one of the most fun Christmas activities that our family every ever did was a couple years ago. My side of the family had joined with Chris and me. We have three kids, two that are married. And then my sister, her two kids, and then both my parents came and spent the Christmas holidays with us. And one of the things that we did that was so fun, is we'd been up at a cabin up in the mountains. And so we drove down to the bottom of the mountain into town, and Chris gave everybody a twenty dollar bill. So everybody got a twenty dollar bill.

Dr. Rick B.:    That's awesome. I wish I was there.

Alisa Grace:    And then we put everybody's name in a hat, and everybody drew a name and you were going to buy a gift that was $20 or less for that person. And so what we did is we drove to Big Lots.

    We drove to big lots. We gave everybody 30 minutes, they had their $20. You couldn't tell anybody whose name you had, and you had to go in and buy that person the gift. And so it was so funny.

Dr. Rick B.:    That's great.

Alisa Grace:    Because it was a pretty small town. But here we were, it's like, we overrun the store and we're all going, commando crawling through the aisles because you don't want the person you're buying for to see you buy what you're buying for them. But what we did is, once we got back to the cabin, everybody had their gift in their little Big Lots bag. But what we did is, we went around in front of the fireplace person by person and you opened the gift that you received.

Dr. Rick B.:    That's great.

Alisa Grace:    And the person that bought for you, then told one thing that they really appreciated or admired about the person that they bought for.

Dr. Rick B.:    That's great. That's great.

Alisa Grace:    And I can tell you that most of us ... I mean, somebody got a little pink foil Christmas tree.

Dr. Rick B.:    Were you excited about that Chris? Or is that ...

Alisa Grace:    He still puts it up secretly.

Chris Grace:    I put it together the fastest. And I often win the ability to open up my Christmas gift first. But at least I think that was so memorable because even the person who received that gift, it was intentionally bought for this person who loves pink, loves Christmas trees.

Alisa Grace:    Yeah. But even more so was what they said.

Dr. Rick B.:    Mm-hmm (affirmative).

Alisa Grace:    Everybody walked away with going, "Wow, that was really meaningful to hear somebody that I cared deeply about, to hear from them, what they love or admire or appreciate about me." And it was just so affirming, so other focused.

Dr. Rick B.:    Mm-hmm (affirmative).

Alisa Grace:    And instead of being excited about ... I mean, so the gifts were goofy. And some of them were really pretty, okay. But really it was the gift of affirmation that meant the most to everybody. And so, we've started doing that now.

Dr. Rick B.:    Yeah.

Alisa Grace:    Whether we're a big family, or it's just our immediate family, that's our Christmas party now is, we go to dinner and then we get our envelopes of 20 bucks and we go to Big Lots. And then we have that gift giving.

Dr. Rick B.:    That's great. That's awesome.

Chris Grace:    Yeah.

Dr. Rick B.:    That is awesome.

Chris Grace:    Yeah. And you can do it for even cheaper, right? You can do it for 10 or you can ... Whatever it is. But you usually try, it forces you to constrain. But it forces you to think through, "What is this person? Why do they mean so much to me? I pick their name randomly, but still I have to think through them-"

Alisa Grace:    And creatively.

Chris Grace:    "What would they like? And what speaks to them?" And it's just really cool.

Dr. Rick B.:    That's great. Love that. Love the story. And what a great way to build the family up.

Chris Grace:    When you, Rick, find out that people are putting on this need for buying, and gift buying, what is that coming from? Why is it so important that people would even sacrifice going into debt? Is it just cultural? Is it just the way we've kind of been raised? What is going on with that?

Dr. Rick B.:    I think there's a love language part of that too, that some people feel that that's part of how they show their love. Right? And it may or may not be how the person that's getting the gift receives the love. Right? Which is again an important part of communication. But I think there's something about maybe feeling like it's making up for something that is missing in a relationship. Or can be. So I think you have to be really thoughtful in how and why you give gifts.

Chris Grace:    Mm-hmm (affirmative).

Dr. Rick B.:    Maybe the gift of time is the greatest gift that you can give to somebody in the family. And for those of you who maybe are struggling with that, I would encourage you to be really thoughtful in how you give what you give to your family.

Chris Grace:    And so tell us then, Rick, the best pieces of advice. And you've taught courses, this is kind of been one of your areas of expertise. And helping people, either that are in debt, how to get out of debt. What can they do at this Christmas season in order to help them do that?

Dr. Rick B.:    Boy, you know, I go back to God's ownership of everything that we have. 1 Chronicles 29:11 talks about how God owns everything. And I think that gives us a different perspective when comes to what we have, and what we do with what we have. Would God be pleased with this decision? And I think that makes a big difference when we're out looking for gift giving, and when we're talking about what we buy, how would this please or displease God? And be really strategic in how we use God's resources. These are not our resources, they're God's resources. So being a good steward of what God has gifted to you, I think is huge.

Alisa Grace:    That's a great point. I would just ask you this question too, Rick. Let's say that we've gone ahead, we've done the hard work of establishing our budget. We've tracked our spending. We've we know right where we're at. We know what we have to spend, and we actually have a plan in place.

    But let's imagine that a couple of weeks into it, let's say it's December 15th, and suddenly we realize, "You know what? I've really already gone off track. I've already blown my budget and I haven't even gotten close to what I wanted to spend, or what I wanted to purchase. So, I've gotten on off track, so maybe I might as well just go ahead ... I'm off track, so I might as well just go ahead and blow it all and just pick up the pieces later."

Dr. Rick B.:    Mm-hmm (affirmative). Mm-hmm (affirmative).

Alisa Grace:    So if we find ourselves that we've gotten off that plan midstream, how do we get back on it?

Dr. Rick B.:    Great question. And I think I hear this frequently from students, the debt that you want to try to pay off first, if you've got debt that you really can't afford, which I think is most debt, you really want to look at the highest interest rate types of loans first, which are usually credit cards, and pay off those highest interest rates first. If you have a number of debts, right, you want to begin maybe with highest interest rates. If that doesn't work, then maybe go with the smallest debts that you have that you're carrying first. Because those are easier to pay off.

    Make a minimum payment on all of your debts, but that small debt, try to knock the whole thing down. And then move to the next one. And then move to the next one. That's the snowball debt philosophy, and it works well. But you want to be strategic in how you structure that debt. Don't get over overwhelmed by it, but be really strategic in how you pay that down.

Chris Grace:    Mm-hmm (affirmative).

Alisa Grace:    I love that. I love that.

Chris Grace:    Rick, thinking about all of this advice, which I think for so many listeners is going to be helpful. Not just helpful, but can be if they institute it, transformative. Because relationships seem to run sometimes very well, and money seems to be that lever that can ... Maybe it's just a sign of trouble in the marriage, maybe it is the cause of trouble. And I think if they listen to some of these things ... So what if it's a new relationship? What if you're starting off, you're newlyweds, you want to do this right. What advice would you give? I mean, money plays it's an important role.

Dr. Rick B.:    It does, yeah. Yeah. I'd go back to I think the beginning conversation, which is, discovering what that other person's financial philosophy is. Are they a spender? Are they a saver? How does it fit? And it's not wrong or right either way, but it's part of the conversation of learning who that other person is.

Chris Grace:    Mm-hmm (affirmative).

Dr. Rick B.:    I've read articles that say, you ask a FICO score on that second or third date. That might be aggressive and there's probably no better date blower than-

Chris Grace:    You might want to ... Tell them what a FICO score is.

Dr. Rick B.:    Yeah. A FICO score is a credit score. That's what the credit agencies will give you. In fact, I would encourage your listeners if you don't know your FICO score, check it out. Because you really want to know. And the larger the FICO score, the better.

Chris Grace:    Right.

Dr. Rick B.:    And what a FICO score will do, it'll make a difference when you go in for that car loan or your home loan. The better FICO score gets a lower interest rate.

Alisa Grace:    Mm-hmm (affirmative).

Dr. Rick B.:    So there's value in that. But the other thing that a FICO score will do, it'll tell you how secure your social security is, because your social security number. Because that's basically how you kind of track that information. And it's good to know if somebody has maybe been messing with your credit score.

Alisa Grace:    So in other words, you can get a report that shows not just your FICO score, but if it's low, you can follow up and see, "Is it possible that's somebody has tried to use my identity?"

Dr. Rick B.:    Absolutely.

Alisa Grace:    And if so, they're opening up credit cards somewhere in my social security number. And opening up too many credit cards is a sign that uh-oh, the bank says, "We're going to lower your FICO score. You're opening up too many cards." Is that right?

Dr. Rick B.:    That's absolutely right. And what happens is, social security numbers can be stolen, and accounts opened up in your name. Well, you're not paying on those accounts, so those accounts go in the red. They don't get paid. And then it affects your score, and drops your score. So you really want to at least a couple times a year, check your FICO score. [crosstalk] And there's a number of credit cards that will do that as part of their programs. But, it's well worth staying in touch with your credit.

Chris Grace:    And the nice thing is, I don't know Rick if this is new, but the FICO of course is the F-I-C-O.

Dr. Rick B.:    Right.

Chris Grace:    And it seems to me that they're free. I get it offered all of the time, and other people in the past seem to have to pay for it, or you can only get one a year. But now it seems like it's ...

Dr. Rick B.:    Much more frequent.

Chris Grace:    Much more frequent.

Dr. Rick B.:    Yeah.

Chris Grace:    And so you would recommend, they talk about their FICO score.

Dr. Rick B.:    Talk about it. Absolutely.

Chris Grace:    And know it, and then see what they can do to improve it. Right?

Dr. Rick B.:    Right. Absolutely. If you're dating and really getting serious about somebody, you don't want any surprises. And I think that's on both sides. So if you're carrying debt, I think I'd be really open about that. If you're dating somebody, and you kind of wonder where they are in their finances, start asking some of those questions in a gentle sort of way.

Chris Grace:    Yeah.

Dr. Rick B.:    But I think it's one of the things that really shows love, if you can be honest. Husbands love your wives, right? So guys, if you're managing the finances, be transparent with your spouse. Because there's great value in transparency and communication. It will really save a lot of problems in marriage. [crosstalk].

Chris Grace:    And then the coral area is obviously if there is someone who is struggling today, Rick, in this, there may be hiding. They may be keeping something. They're just so shamed by what they're doing, or so embarrassed that they're just not able to communicate about it. And that's where I think you said, find somebody.

Dr. Rick B.:    Absolutely.

Chris Grace:    At least get it out. Talk about it and start on that process of uncovering shame. Shame can't live in the dark.

Dr. Rick B.:    Absolutely.

Chris Grace:    It lives in the dark, but not in the light.

Dr. Rick B.:    Yeah. Absolutely. Talk to your pastor. Talk to a friend maybe who's a good advisor. That both of you would be receptive to. So yeah, make sure you're communicating.

Chris Grace:    Yeah.

Dr. Rick B.:    Don't hide it.

Chris Grace:    Yeah. Well, I think was we think about ... And we'll wrap up, Rick, with just a last couple of thoughts. And I'd love for you to speak to the listeners out there who are thinking, "Okay, we're doing good." Is there any red flags that you would say, if two people are interested in each other and all of a sudden their FICO score is below 500, or maybe it's a green flag it's anything above seven or whatever.

    But are there any red flags? Is it somebody who's hesitant to talk about it? It's certainly not what kind of background I don't think they came from. They could have come from blue collar, white collar. That's not the issue. Is a lot of debt a red flag? Is overspending? What do you see as like, "Uh-oh, this is what I would challenge you to [crosstalk]."

Dr. Rick B.:    No, I think it's the type of debt that's being carried. Is it education debt? Because education debt can be large, but there's a reason. Because you're getting a degree, and that will affect your ability to gain a job. Right? But is it something else? Is it a tendency to spend in areas that are not healthy, that are not good debt? And good debt versus bad debt is probably a longer conversation, but you get the idea.

Chris Grace:    Yeah. Give us an example.

Dr. Rick B.:    A good debt is a debt that has a return to it. It could be an investment, it could be related to education, as we've said. Or the purchase of a property, a home, those types of things. Bad debt are things that don't have a return. Maybe it's a nicer car, that you really don't need. Or maybe it's an expense of fine jewelry that maybe is not a good investment. Something like that. Yeah, could be clothes. We're not going to throw anybody under the bus on that. But you get the idea.

Chris Grace:    What about when someone goes and buys new clothes all ... I mean, and they buy like really-

Alisa Grace:    Rick, what about ...

Chris Grace:    No, no. What about, they wear jewelry all the time and you're like, "Wait, what does that chain?" Okay. Keep going, I'm sorry.

Dr. Rick B.:    Okay, and in closing ... I think you get the idea. You just, you want to see where that debt lies.

Chris Grace:    Yeah.

Dr. Rick B.:    And you want to see how they're dealing with it. Is it growing, or is it being dealt with? And a healthy relationship is one again, that has open communication. The debt is being reduced. Assets are over liabilities. You want to have ... Julie and I keep a ... I'm kind of tactile and I like to keep a list. But I have a list at home of assets and liabilities.

Chris Grace:    Mm-hmm (affirmative).

Dr. Rick B.:    And every month I want to see the liabilities list getting smaller, and the asset list getting greater. And it shows the right direction in our relationship and our marriage. And now, as I'm getting closer to retirement, I know that I'm able to move into that part of my life in a good way.

Chris Grace:    Mm-hmm (affirmative).

Dr. Rick B.:    So you really want to be thinking through what that debt looks like, if you're just beginning to date. And, do you have a strategy, a plan, to get out of that debt and be free to do whatever God has called you to do?

Alisa Grace:    I love that.

Chris Grace:    As you close, resources for them? I mean, you taught this course. It'd be awesome if they could go do it online, or could find it. I know you mentioned the word, Dave Ramsey. No one's ever heard of him, but give him a shout out.

Alisa Grace:    Some money guy out there.

Chris Grace:    Maybe he'll get bigger after this podcast. But Rick, do you have any closing thoughts on, "Okay, here's what really helped me." Or, "Here's just, if you're in this area and you really want to try something, do this."

Dr. Rick B.:    Yeah. We've talked about Ramsey, and he really is a wise, godly man that has good directives. He wrote a book called The Total Money Makeover, which is a great resource. It kind of gives a challenging message to really take seriously finances. Another book that I've used in class, that's been really good for investing is, James O'Donnell did a book called The Shortest Book Ever on Saving for ... I guess it's Saving for Retirement. But it's good at every life's stage, because it gets you into the habit of being a wise investor. So, what types of stocks and bonds and mutual funds.

    And if you were like I was, I really didn't have a clue what all those things meant. But as I began to study and research and teach on it, it opened my eyes. And it is a short little book. It's a great resource, and it will give you some really good insights.

Alisa Grace:    I love that. I think Chris and I read through The Total Money Makeover. And, we read it, or I guess I read it before you did, huh Chris?

Chris Grace:    Mm-hmm (affirmative).

Alisa Grace:    But read it at a point in our marriage, and in our finances, where we really needed to get serious about getting out of debt, and staying out of debt. And I would say ... Because Chris is the saver, he's always been. I say, if we have any money today, it's because of my husband, not because of me.

    But I wanted to have a better handle on it. I wanted to figure out, "Why is this area so hard for me?" And that was something that I had to process with the Lord too. Almost as a form ... Our finances and how I handled them, for my aspect, said a lot about my discipleship, I found out.

Dr. Rick B.:    Mm-hmm (affirmative).

Alisa Grace:    And I also found out after reading that book, this was really insightful for me, is that I do not do well with just nebulous thoughts about, "Oh, we need to tighten our belt. We need to really watch what we're spending." And it's like ...

Dr. Rick B.:    "What does that mean?"

Alisa Grace:    "What does that mean?"

Dr. Rick B.:    Yeah, exactly.

Alisa Grace:    "Are you to talking like $2,000? Are you talking $200? Are you talking $20?" I don't know what that means. And when I'm at that choice point, it's hard for me to make that decision, "Do I spend this, do I not," when it's so nebulous. So we figured out that if we actually have a goal, and I can watch it every month, kind like what you're saying that you and Julie do in watching your liabilities and your assets. Every month, if we could check in with each other, and we had a goal to set for what we wanted to save, and what debt we wanted to get rid of.

Dr. Rick B.:    Mm-hmm (affirmative).

Alisa Grace:    That helped me really be able to make those hard choices.

Dr. Rick B.:    Makes it tangible, doesn't it?

Alisa Grace:    Yes. And measurable.

Dr. Rick B.:    Mm-hmm (affirmative).

Alisa Grace:    It had a measurable like, "Okay, we are this much closer to our goal. All I have to do is give up this many more cappuccinos. Maybe I don't buy that pair of shoes. Okay. Our house can do without this or that." But when I had that tangible goal, and I could watch it go up or down, that really helped me.

Dr. Rick B.:    That's great. Yeah, that's good.

Alisa Grace:    And so I'd really highly recommend that book, The Total Money Makeover.

Chris Grace:    I immediately fell in love with Dave Ramsey at that point. In fact, it's an unhealthy obsession now by leaving him in his books all around Alisa and saying, "Lise, have you read this?" I've never read it, but she ... No, no. It's really good to do that, Lise.

Alisa Grace:    It is.

Chris Grace:    And I think it really did. You would say, I remember, "Wow, we have $200 this month that we put into savings. And now we're only $100 short of our next goal which is we're going to pay whatever."

Alisa Grace:    Exactly.

Chris Grace:    It was really helpful.

Alisa Grace:    Exactly. And it was really helpful. And I think by reading that, we don't fight about money anymore.

Chris Grace:    Yeah, we rarely do. This podcast is bringing up some thoughts that we've had in the past about, but mostly they're good thoughts. Because at least it's the thoughts of, "That used to be an issue. And it really isn't."

Alisa Grace:    And it's not, yeah. We're more on the same ... It got us on the same page.

Chris Grace:    Yeah.

Alisa Grace:    I'll say that.

Dr. Rick B.:    Makes for healthier marriages, doesn't it?

Chris Grace:    It sure does.

Dr. Rick B.:    Yup.

Alisa Grace:    Yes it does.

Chris Grace:    And that's kind of what we're doing, Rick. And thanks for doing this podcast with us. Because it is about the art of relationships. And money, it really does influence what happens in our health of our relationships, in our marriages, and man that's some good advice.

Alisa Grace:    Yeah. Now's the time to do it. We're wrapping up the year, and going into the new year. So, Rick, thank you so much for being with us.

Dr. Rick B.:    Thank you!

Alisa Grace:    A delight to have you with us today.

Dr. Rick B.:    What a privilege. Thanks. Blessings.

Alisa Grace:    Okay, everybody. Check out our website, cmr.biola.edu. That stands for Center For Marriage and Relationships. Send in your questions if you have something that you would like for us to address.

Chris Grace:    Yeah, send it in. Rick has blogged for us, Rick, in the past. And go check him out as well. Go to cmr.biola.edu/podcast or, you can do /blogs, and check out the financial ones. There's some great materials and great resources. And I think Rick, you list some other wonderful ideas in those blogs as well. So thank you so much for joining us today.

Dr. Rick B.:    Thank you.

Chris Grace:    All right.

Alisa Grace:    Okay. Bye-bye.

Chris Grace:    Thanks Rick.

Dr. Rick B.:    Bye.

Speaker 1:    Thanks for listening to The Art of Relationships. This podcast is only made possible through generous donations from listeners just like you. If you like it, and want to help keep the podcast going, visit our website at cmr.biola.edu and make a donation today.