Summary: This is part one of a four part series on financial management. Part one focuses on how we should pay ourselves in preparation for our future retirement.

Godly Financial Management – Part 1

Pay Self

Scriptures: Proverbs 22:7; Matthew 6:24; Luke 16:3-13; Romans 13:7-8


This series will close out the multi-series that I have done this year on being a slave for Christ. In these four messages, I will focus on how we must take steps to get our finances in order so that we will be able to fully accomplish what God has called us to do. I will focus on four areas: Pay God; Pay Self; Pay Bills; Pay (Give to) Others. I will start today with “Paying Self” because if we do not get this in order we will never be able to fully pay God. As you consider what I will say to you this morning I want you to remember this in the weeks to come as you consider your Christmas shopping. During this time of year many will create more debt than they currently have. In the spirit of “Christmas” people will spend what they do not have and even raid their savings accounts to cover the cost of gifts. Many people describe Christmas as big or small based on how much they can afford to spend on gifts for others. This year I hope that before you spend a penny on gifts for others, you will pay yourself first and start down a road to truly become financially debt free.

I have used the word “pay” in each reference of the four specific areas I will be focusing on. The reason that I selected this word is that when you pay something you give money to whomever you owe and the money leaves your sight and your possession. We see this when we give money to the Church; when we pay our bills; and when we give money to others. But we do not necessarily see this when it comes to paying ourselves. For some people this means giving yourself an allowance and you can spend it on whatever you wish. For others it means paying yourself and acting like the money is no longer in your possession. The latter is what I want us to consider this morning. When you pay yourself you take the money and put it somewhere out of sight with no intention of touching it until you retire or run into a real financial emergency. Let us begin with our foundational Scripture from Proverbs 22:7. It says, “The rich rules over the poor, and the borrower becomes the lender’s slave.” In this verse Solomon wrote that the person who borrows money becomes the slave of the person from whom they borrowed the money. In the verse preceding this one he wrote, “Train up a child in the way he should go, even when he is old he will not depart from it.” In this series I am trying to help us train up our children so that they do not repeat our mistakes. According to God’s standard, we should operate on a cash basis. If we have the cash, then we can make the purchase. No cash, no purchase. Whenever we make a purchase and we finance it, we are actually buying something that we cannot afford to buy at that time. I know this sound radical, but think of it like this: if we’re financing something and we fail to make a couple of payments, they repossess whatever it was that we purchased and we lose everything that we put into it. Although we were making payments, we do not fully own it until its paid for. Think about a car that is repossessed if we fail to make the payments. If they repossess our car; sell it for less money than we owe on it, we will owe them the difference and they will come after us to collect what is owed. James said “…..Is it not the rich who oppress you and personally drag you into court?” (James 2:6) James stresses that it is the rich who take the poor to court to collect what they believe is owed them. The borrower becomes the slave of the lender and the lender will collect their due. Why is this a problem from God’s view point? Turn with me to the sixteenth chapter of the book of Luke. We will begin reading at verse ten.

I. You Cannot Serve Two Masters

In Luke 16:10-13 Jesus makes the following statement: “He who is faithful in a very little thing is faithful also in much; and he who is unrighteous in a very little thing is unrighteous also in much. Therefore if you have not been faithful in the use of unrighteous wealth, who will entrust the true riches to you? And if you have not been faithful in the use of that which is another’s, who will give you that which is your own? No servant can serve two masters; for either he will hate the one and love the other, or else he will be devoted to one and despise the other. You cannot serve God and wealth.” In this example Jesus told the story of a rich man who had a dishonest manager (servant) who was squandering his money. When the rich man discovered how the manager was losing his money he asked him to give an account for his actions. The rich man also decided that he would terminate the manager. Upon hearing this, the manager then went to those who owed the rich man money and reduced how much they owed him so that these people would be indebted to him and would assist him once he lost his job.

When you consider this story I want you to think about how you handle your money (or even better, how we handle the money God entrusts to us since it all belongs to Him.) As Christians we teach and believe that God takes care of us and provides for all of our needs which are absolutely true. However, the disconnect come in when we misuse what He provides for us because of our lack of knowledge or because we just desire to live a certain way. Let’s review what Jesus said and see how it relates to us paying ourselves. In verses ten through twelve Jesus talks about faithfulness. He stress that if a person is faithful with something small then they will also be faithful with much. Likewise it is true that if a person is unrighteousness with something small they will be unrighteous with a lot. Consider this: would you entrust your life savings with someone who is dodging the creditors they owe? Probably not because how can they handle your money if they cannot handle their own? No one would place someone in a position of managing money if they have not first demonstrated through their actions that they can do it. In verse twelve Jesus asks the question “And if you have not been faithful in the use of that which is another’s, who will give you that which is your own? Again, the point is that if we cannot manage what someone else places within our control who would give us something of our own? These verses are about personal accountability. Look at verse thirteen.

In verse thirteen Jesus says, “No servant can serve two masters; for either he will hate the one and love the other, or else he will be devoted to one and despise the other. You cannot serve God and wealth.” In this verse Jesus makes it clear that we must choose. Earlier we read that the borrower was a slave to the lender and here Jesus makes it clear that we cannot be a slave to two masters. I know some of you may be thinking I am reaching here, but follow along with me. If I am seeking wealth and that is my goal, will I truly be serving God if having wealth is my primary goal in life? No! If I live my life in debt and all of my time is focused on earning more so I can spend more, do I really have time to serve God? No. If God tells me to do something for someone else, can I do it freely if my heart and mind is focused on my lack? No. If I do not have enough money to take care of myself would I really feel free to help someone else? No! So if you examine what debt does to our mentality it forces us to work more and longer and reduces any time that we would have for God. If however, we follow God’s plan for how we live our lives, the wealth will come and we will be able to handle it appropriately because we have learned through our life experiences how to do it. We volunteer to enter into slavery because we choose to mismanage the resources God has placed within our control. We love our toys, vacations, clothes, jewelry, and everything else that keeps us in debt. If you’re seen the moving “Fighting Temptations” you’ve seen the scene where Cuba Gooding is paying for a meal with his date and his credit card is denied. In another scene he is using one credit card to pay on another one. I have been there myself. This is called robbing Peter to pay Paul. This is not how God wants us to live and trust me when I say it is no fun living that way. So what does all of this have to do with us paying ourselves?

II. Paying Yourself

In the story we just read, I shared with you why Jesus made the statements that He made about the unrighteous manager. But to make this point clear, let’s go back to the beginning and read what the manager said. Look at verses three and four. “The manager said to himself, ‘What shall I do, since my master is taking the management away from me? I am not strong enough to dig: I am ashamed to beg. I know what I shall do, so that when I am removed from the management people will welcome me into their homes.” (Luke 16:3-4) If you read the rest of the story as I shared earlier, he went to those who owed his master and reduced their debts so that when he was fired they would be willing to help him. Although this was wrong, he was thinking ahead about taking care of himself. Now notice what Jesus said about this man’s action: “And his master praised the unrighteousness manager because he had acted shrewdly; for the sons of this age are more shrewd in relation to their own kind than the sons of light. And I say to you, make friends for yourselves by means of the wealth of unrighteousness, so that when it fails, they will receive you into the eternal dwellings.” Do not misunderstand what Jesus was saying here. What was being commended here was the forward thinking of the manager, not his dishonesty. This manager used his present opportunities to prepare for the future. Likewise the believer should use what we have access to in this life (wealth of unrighteousness) in service of God in order to be assured rewards in the next life. We need to plan for the future: our future here on earth as well as our future with Christ.

Now consider this: if this man had an emergency fund, he could potentially have had funds available to help him survive until he got his act together and got another job. If he had paid himself first and set money aside, he would not have had to do what he did to secure his future. Does this make sense? As we discussed in Bible Study this week, if you were down to your last $100, would you give all of it to someone in need? Most of the responses said no and that they would be willing to give part of it to help the person but not all of it because they would need some for themselves. Well isn’t that the same here? If we spend more than we make we are not holding anything for ourselves. If we spend everything that we make we are not saving anything for ourselves. Yes we will have the material things that we have purchased, but we could lose it all if our financial situation changed drastically.

What does it mean to pay yourself? Have you ever heard someone say that they work hard and earn money but have nothing to show for it except bills? Or someone says, “I owe, I owe, so its off to work I go?” In both of these situations the focus is on what they owe. How much better our lives would be if we worked hard now so that we would not have to work at all later? I am not talking about living off of social security if your company does not provide a retirement plan; I am talking about living comfortably without social security. I am talking about being able to do what you want to do when you want to do it and having more left over to use as God instructs you for the betterment of His kingdom. Let me give you two realistic examples. In both of these examples the individuals do not work for a company that has a retirement plan and must save plan for their own retirement. (In my examples, I used to calculate the numbers.)

In the first situation, the person is 25 years old and makes $25,000 per year. Each year he gets a 2% salary increase. His goal is to retire at the age of 62 and live happily ever after. He makes the decision to live below his means because he knows that he could live to be 85 or 90 years old based on current medical technology improvements. He takes 8% of his income ($2000) off the top (before taxes) and places it in a 401K. His 401K earns 10% (on average) per year. At the age of 62 he will retire with $834,030 which he places in an account that draws an annual interest rate of 8%. On January 2nd of his first day in retirement, he withdraws $46,000 from his account to live on for that year. He will also draw approximately $1800 in social security per month for a total for the year of approximately $67,600. If he lives until he is 90 years old, when he dies he will still have $495,654 still left in his 401K.

My second example is of a young married couple that decided early that they want to live comfortably in retirement. They resisted the urge to purchase new cars every couple of years or taking annual vacations. As a couple they make $40,000 per year of which 8% ($3200) annually is placed in a 401K account which earns 10% annually on average. As with the single person, their company does not offer a retirement plan. At the ripe old age of 62 this couple will have $1,334,450 in their IRA. On January 2 of their first year of retirement they withdraw $75,000 from their IRA account. They will also receive together $3000 per month in social security for a total annual income of $111,000. If both live to be 90 upon their death they will still have $644,000 in their IRA for their descendants.

These examples are not only realistic, they are factual. There are many millionaires who earned their money working a “regular” job. They did it by paying themselves first (saving) and not touching it. In our current environment this may seem far fetched but consider your options. If you do not start now, when will you start?

I talked with my mother-in-law this week and she asked me to figure out a math problem. We had discussed this before but I had forgotten the answer. The question she asked me was “If you take 1 penny and each day for 30 days you doubled it, how much money would you have at the end of 30 days?” So on day one you have 1 penny. On day two you have 2 pennies. On day 3 you have 4 pennies. On day 4 you have 8 pennies. So each day you double what you had the previous day. How much do you think you would have on day 30? Now before you answer, let me ask you this question, if someone gave you the choice of taking $500,000 dollars today or the sum of whatever the amount will be by doubling your pennies for the next month (30 days total) which would you choose? Both are a guaranteed payout. If you chose to take the $500,000 up front you would be sorely disappointed. If you double a penny everyday for 30 days, on day 3 you would receive $5,368,709.12. It starts with a penny. Would you sacrifice $5.4 million dollars in 30 days for the immediate gratification of $500,000 dollars today? If you’re not planning for your future this is exactly what you’re doing. We are sacrificing our future for the immediate pleasure of today. I know some people might be thinking "What if I don’t live to retirement?" and my response is "What if you do?" If you do not plan to retire, you will never retire!

III. Owe Nothing – Pay All!

I want to ensure that I keep what I am sharing with you in balance with what the Word of God says. As I talk with you about saving for your future, I am not asking you to focus on being rich. What I am asking you is to focus on being debt free and being able to live and do things for God freely – now and when you retire. In Romans 13:7-8 Paul gives this instruction: “Render to all what is due them; tax to whom tax is due; custom to whom custom; fear to whom fear; honor to whom honor. Owe nothing to anyone except to love one another; for he who loves his neighbor has fulfilled the law.” Paul said that we should owe no man anything except to love them. He was speaking of living a debt free life. We know that there are times when we will incur some indebtedness, but our lives should not revolve around debt.

We will never become debt free if we do not start living differently from how we are currently living. We must establish an emergency fund so that when an emergency comes up we will not have to tap into the funds we have used to pay ourselves. We must pay ourselves ever time we get paid so that we get in the habit of saving for our future. We must begin to give to God as all of it belongs to Him. While we are on this earth we are charged with using what He places within our grasp wisely. We will never fulfill God’s design for how we use money if we spend it before we get it and never save anything. I will leave you with these words.

“There is a way which seems right to a man but its end is the way of death.” Proverbs 14:12

We have done it our way, maybe it is time we tried it God’s way.

“By wisdom a house is built, and by understanding it is established; and by knowledge the rooms are filled with all precious and pleasant riches.” Proverbs 24:3-4

Without tapping into God’s wisdom as it relates to money we will choose to live in a state of paycheck to paycheck; three paychecks away from being homeless. This is not how God wants us to live because living like this means that we do not have the means to help anyone in need or to support His ministry work.

Next time we will focus on giving to God.

Day 1: $.01

Day 2: $.02

Day 3: $.04

Day 4: $.08

Day 5: $.16

Day 6: $.32

Day 7: $.64

Day 8: $1.28

Day 9: $2.56

Day 10: $5.12

Day 11: $10.24

Day 12: $20.48

Day 13: $40.96

Day 14: $81.92

Day 15: $163.84

Day 16: $327.68

Day 17: $655.36

Day 18: $1,310.72

Day 19: $2,621.44

Day 20: $5,242.88

Day 21: $10,485.76

Day 22: $20,971.52

Day 23: $41,943.04

Day 24: $83,886.08

Day 25: $167,772.16

Day 26: $335,544.32

Day 27: $671,088.64

Day 28: $1,342,177.28

Day 29: $2,684,354.56

Day 30: $5,368,709.12