Summary: 12 Dumb things we do with our money - and how to change it!

Major Mistakes We Make With Our MONEY

Malcom Forbes

Failure is success if we learn from it

The Bible says, “If you belong to Christ Jesus, you won’t be punished.”

If you have blown it with your finances – we are not here to beat you up. NO! God forgives when asked – so do we.

Have you ever had or seen a child disobey and then get hurt? A parent says, “No more than one child on the trampoline at a time,” and they have three and end up getting hurt. Many times the parents will say, “You have been punished enough.” Sure, some financial mistakes punish us pretty bad.

Well, if you have made some of these mistakes you hopefully have learned from them. If you haven’t made them – my goal is to help you avoid making them.

My idea of a good education is learning from someone else’s mistakes!

I desire to see you walking in victory in every area of your life. There are so many who are really struggling and hurting because of money today – I want to throw a life preserver to those who are drowning.

REVIEW (quickly)

1. Instead of Russian Roulette you Play American Too Much Debt

(Illustrate with Chains & weights)

a. Proverbs 22:7 The rich rule over the poor, and the borrower is servant to the lender. NIV

b. Act like chain is a nice necklace and then put weights on it for things we want and buy on credit.

c. Dave Ramsey in an interview last month (4/03) with Failure Magazine said. “Seventy-five percent of the Forbes 400, when asked, ‘What’s the key to building wealth?’ said it’s getting out of debt and staying out of debt. Old, rich people tell you to get out of debt. Only young, broke finance professors tell you to use debt.”

2. Get Rich Quick

a. I was reading in a Christian magazine about this great investment. Their last 5 stock picks have all generated 50 to 330 % returns within just a few months. I read another advertisement in the same magazine about a business I could get involved with that one man in 7 months was making $20,000 a month

b. 1 Tim 6:9 People who want to be rich fall into all sorts of temptations and traps. They are caught by foolish and harmful desires that drag them down and destroy them. The love of money causes all kinds of trouble. Some people want money so much that they have given up their faith and caused themselves a lot of pain. (CEV)

i. The itch to get rich is wrong, the Bible calls it sin

ii. Wealth that is made - is stored up over time.

Money that is lost – is usually lost quickly.

c. This comes out in many ways

i. Gambling – casinos, lottery,

ii. Day trading

iii. Investments

d. Eccl 11:6 Sow your seed in the morning, and at evening let not your hands be idle, for you do not know which will succeed, whether this or that, or whether both will do equally well. NIV

3. Don’t Save

a. The world can be divided into those who believe in saving for retirement and those who believe in the Retirement Fairy.

b. Prov 21:20 The wise man saves for the future, but the foolish man spends whatever he gets. TLB

c. Example: Dexter buys his new $20,000 car with 10% down and a 48-month loan, while Joe postpones the purchase, saving up the money and paying cash. Dexter’s monthly payment on the loan is $448, but Joe needs to set aside only $344 each month in a 5% taxable money-market account to pay cash for the car at the end of four years. Joe started buying all his cars this way at age 30 and put the $104 savings in an IRA earning 9%. By the time he retires at 65 he’ll have an extra $352,000

4. Being Lazy

a. Dave Ramsey has a poll on his website that says, “what is your excuse for not doing a budget?! Tied for number one with overwhelming is “I’m Lazy”

b. Proverbs 10:4 Lazy men are soon poor; hard workers get rich. TLB

c. 2 Thessalonians 3:6-10 (MsgB)

i. Our orders—backed up by the Master, Jesus—are to refuse to have anything to do with those among you who are lazy and refuse to work the way we taught you. Don’t permit them to freeload on the rest. [10] Don’t you remember the rule we had when we lived with you? "If you don’t work, you don’t eat."

d. People who never do any more than they get paid for, never get paid for any more that they do. Elbert Hubbard


5. Co-sign a Loan

a. Why is this a mistake with a capital M? Because you have made yourself responsible to pay for something where you have ZERO control. You do not get the benefit of the purchase, but you have taken risk. If they decide not to pay – the only thing you can do is – pay. Don’t do it. Period.

P. Ted, you are being so harsh! No Way! Listen to this note sent to a financial advisor…

b. "I co-signed a loan for my brother-in-law who has since left my sister and has stopped paying the note…the lender is now after me to pay. How can I get out of this?"

c. Proverbs 17:18 It is poor judgment to countersign another’s note, to become responsible for his debts. TLB

d. "In a weak moment I agreed to help a friend get a mortgage by co-signing his note. My friend has always made the payments, but I discovered that his mortgage shows up as debt on my credit report, and it prevents me from getting a mortgage of my own. How do I deal with this?"

e. "You should never co-sign a loan," says Lynn Brenner, a personal finance columnist. If the primary borrower gets behind in payments, "the bank will come after the person they have the greatest chance of collecting from. If they thought they had a good chance of collecting from your son, they wouldn’t have required a co-signer in the first place."

f. Don’t think you are smarter than the bank – they don’t trust the person’s ability to pay. And don’t think you are wiser than God – He said if you do it you lack sense soon to be cents.

6. Being Stingy

a. This one really amazes me. The Bible says, “There is one who scatters, and increases yet more. There is one who withholds more than is (right) appropriate, but gains poverty.” (Prov 11:24)

b. This verse is not talking about Mr. Scrooge who won’t even give the time of day to somebody. This verse is not talking about a person who doesn’t give it talks about a person who doesn’t give enough! Stinginess is seeking one’s own advantage. This person sees someone in need and doesn’t help because they don’t have any compassion. A stingy person is not giving what God wants them to give. When you don’t give enough, the Bible says, that it leads to poverty.

c. Proverbs 11:25 (MsgB) [25] The one who blesses others is abundantly blessed; those who help others are helped.

d. A couple came into a financial counselors office with the husband having just lost his job and they weren’t able to pay their bills and debts. They were in a full pity-party mode with the counselor. The counselor patiently listened for an hour and then gave them some advise on how to change their budget and getting a job. It was time for them to leave when the counselor got a call from his church and they need someone to pick up some money at the church and go buy some food and deliver it to a lady in need. The counselor had a God-idea and asked the couple to do it. They got the money and the list and found out they couldn’t get everything on the list. They began to fight on what they should get – they got mad and ended up buying everything on the list and headed to the lady’s apartment. The apartment was in horrible conditions, the lady’s husband had been murdered and she moved to their city to start over and her baby had just been diagnosed with terminal leukemia. The couple spent the afternoon with the lady helping her by sharing what they had just learned about budgeting, they encouraged her, and prayed with her. They got in the car and as they drove away they both began to cry. That day something broke loose inside them and their finances and relationships began to improve.

e. True living is giving and if you’re not giving, your dying.

f. There was a survey done years ago of over 100,000 people of all ages and one of the things they asked was for the people to describe their most memorable giving experience. The people over 60 described a lifetime of giving monthly as their most memorable giving experience. The people 30 to 60 described helping someone out in a dramatic way – the time a tornado hit or a missionary needed money. The most shocking response was the under 30 crowd. When asked to describe their most memorable giving experience they described receiving something.

g. Let’s learn the wisdom of our elders – they know!

h. This is more than just giving money, it is giving our time and our talent. We gave a t-shirt away to the volunteers of the ministry I used to oversee before God called us here. On the back of the shirt we put this quote:

A hundred years from now it will not matter what my bank account was, the sort of house I lived in, or the kind of car I drove. But the world may be different because I was important in the life of a child.

7. Bankruptcy

a. Imagine someone going into the doctor’s office complaining that their arm hurt. The doctor does a thorough examination and tells them that if they will do 2 certain exercises the pain will be gone. The person comes back 6 weeks later in much pain. The doctor finds out that they have not done the exercises. He tells them again that if they will do these 2 exercises (and they may hurt some) that the pain will leave. 4 weeks later they come back in so much pain that they ask the doctor to amputate the arm.

b. 80 to 90 percent of bankruptcy’s don’t have to be filed. The pain has gotten so bad that drastic measures are taken.

c. Would anyone care to guess the number one reason people end up going into bankruptcy? (Medical Bills)

d. Number two is most likely the lack of life insurance. And soon come up the spending problem. All of these can be solved with good planning and sticking to the plan. When you live without a plan, you end up buying stuff that you can’t pay for, or having emergencies for which you have no savings.

e. Listen to this email sent to Kim @

I filed for Chapter 7 bankruptcy and thought it would ruin my chances of getting a credit card again. But I’ve received quite a few offers from card companies since then. How can that be? Even though a Chapter 7 bankruptcy can remain on your credit record for up to ten years, don’t be surprised if you start to hear from card companies within a few months after you file.

i. "The minute the bankruptcy is over, the high-risk lenders inundate them with credit applications," says Charles Juntikka, a bankruptcy attorney in New York. Some credit-card companies love lending to post-bankruptcy people because they know you can’t file Chapter 7 again for six years, and "many people have been so traumatized by what happened, when they get the credit, their on-time payment records are better than people who haven’t declared bankruptcy," says Juntikka.

8. NO Budget

a. If I had to put these mistakes in order – this one would be the number one major mistake we make with our money.

b. You have heard the statement I am sure – If you fail to plan, you plain to fail. But you may not have read this proverb. “people without a budget perish.” It’s true. The actual verse says that people without a vision perish, but a budget is a vision written down.

c. In a couple of months our family is going out west. It will be our first time to do this and it will also be the first time we ever took this long of a vacation. Don’t worry, the church will be in great hands. We began to talk about it over a year ago. We began to plan it over 6 months ago. And God willing, it is going to happen. We have reservations, the equipment, the money, everything. But if we didn’t have a plan, then when we found out that we were getting a refund this year from our taxes, we would have done something inspirational.

d. Let me demonstrate.

i. Are you ready for Christmas? (No, you don’t have to have all your presents bought, but are you saving up for it)

ii. How long do you think the vehicle you are currently driving will last?

iii. How much a month do you spend on food or clothes or etc – maybe a better question would be, how long will it take you to figure this out.

e. When I was in high school, I used to work part-time at a gas station. One of my duties at the end of the evening was to take a really long stick and open the covers to the gas storage tanks and measure how much gas was left in the tanks. This would help verify if this matched our gas sells, and would also help us to know when we should reorder.

f. A budget is your gas measuring stick. It tells you when you used to0 little or too much of one of your accounts. It let’s you know that you are running out of gas before you do. If you were going to have a great sale on your price of gas, wouldn’t you want your tanks full and place an order the day after the sale?

g. Here is the challenge. Every person knows they should have a budget right? But yet most people don’t. Why? Their actions don’t match their beliefs. 34% said they are just too lazy. This one thing (a budget) done right, could make you a millionaire. This one thing done right can be the difference between staying married and getting divorced. This one thing done right could be the difference between a miserable life and a blessed life. You will work 50 to 60 hours a week but you don’t work 2 hours a week to plan out your 50 to 60 hours.

h. We found out that God had planned on sending his son to the earth 4,000 years before He did.

i. Noah worked 100 years on building the ark. If he had blown it off – you wouldn’t be here.

j. If you don’t know how – great! We can set you up with Jim or Bill and they will tell you about the next class or maybe even invest an hour or two to show you how.

k. Don’t be hearers only. BE DOERS! Don’t dig a hole and put the master’s talent in the ground. Develop a plan and have it compound!

9. Choosing The Wrong Career

a. There are worse things than a fat paycheck. Your options depend largely on your education and skills, but some fields will always pay better than others. Getting the training needed for a better job could be the best investment you make. Ask yourself what the long-term salary expectations are for your career field and consider how you could make yourself more valuable.

b. Does your pay depend on distortions in the market? A lot of semi-skilled but highly paid union workers now know the sting of competition here and overseas. Blue-collar incomes have stagnated over the past 20 years as manufacturers found cheaper workers abroad. Consider what your skills would be worth in a truly open, worldwide market.

c. Will your skills retain their value in the next century? Knowledge is the key to survival in the years ahead, whether you’re a carpenter or a computer programmer. The pace of innovation is staggering, and those who fail to keep up will find their personal stock in a nose dive. Nothing has a more disastrous impact on financial security than a lengthy period of unemployment.

Example: Joe’s salary averages $60,000 over a career of 40 years; Dexter’s averages $30,000 per year. In addition to their IRA accounts, they each put 10% of their income aside each year in taxable investment accounts that yield 8% annually. At retirement, Joe has $1,092,093 to Dexter’s $546,047