Recession Self Defense

....or “How can I pledge when my finances are a mess?!?!”

This year more than ever, parishioners are sharing stories about lost jobs and reduced hours, shorter work weeks and pay reductions. It seems that this year, the effects of the recession are truly being felt. I’ve had a brother, a sister and several friends who have been laid off or cut back in hours. Chances are you or someone you know has as well. According to the latest jobless statistics as many as 20% of us has had our wages affected in some way by the recession – perhaps more.

So what are we to do? How are we to live abundantly in a time of such scarcity? And how in the world are we supposed to make a financial pledge to St. Paul’s at a time like this?

One answer (to all three questions) is to create a budget!

First and foremost, a budget is about creating peace of mind. The simple exercise of sitting down at the dinner table and writing down your income and then listing all your expenses can be incredibly cathartic. But it gets better. Once you develop a budget and start living within in it, you create for yourself a “safe zone” – where you can be confident that things will be OK (so long as you stick to it!). Someone once described a budget as analogous to a roped off area at the beach where it’s safe to swim. Outside the net, there may be sharks, jellyfish and rip tides, but stay within the net, and you can stop worrying, enjoy yourself and have fun.

Sounds nice doesn’t it? It might not surprise you that Jesus describes a similar world in one of my favorite passages from Mathew:

‘Therefore I tell you, do not worry about your life, what you will eat or what you will drink, or about your body, what you will wear. Is not life more than food, and the body more than clothing? 26Look at the birds of the air; they neither sow nor reap nor gather into barns, and yet your heavenly Father feeds them. Are you not of more value than they? 27And can any of you by worrying add a single hour to your span of life? 28And why do you worry about clothing? Consider the lilies of the field, how they grow; they neither toil nor spin, 29yet I tell you, even Solomon in all his glory was not clothed like one of these. 30But if God so clothes the grass of the field, which is alive today and tomorrow is thrown into the oven, will he not much more clothe you—you of little faith? 31Therefore do not worry, saying, “What will we eat?” or “What will we drink?” or “What will we wear?” 32For it is the Gentiles who strive for all these things; and indeed your heavenly Father knows that you need all these things. 33But strive first for the kingdom of God and his righteousness, and all these things will be given to you as well.

I firmly believe that living within in a budget, that is, living within our means, not only helps us resist our culture’s pull toward ever ending consumption and debt, but helps us begin to unlock the abundant life that Jesus is talking about; an abundant life that’s been right in front of us all along. All we have to do is change our attitude and change our priorities. A budget helps us do that.

(And let me add that doing a budget can be an important catalyst to talking about money with a spouse or partner. We’ve all probably heard that money problems are the most commonly cited issues in cases of divorce. Talking about money is hard. And having practiced family law for a number of years, I can assure you that the vast majority of them did not talk about money and certainly weren’t living within a budget.)

So where to start? Here is a budget form that you can print out and use. Start with writing down your income, then fill in your goals around giving (even if you’re not doing it yet, write down what you would LIKE to give - but make some kind of regular weekly or monthly commitment), then do the same with your savings (you goal should be to have at least thee months of living expenses in savings). Finally write down your debts and how much you are paying each month (make sure you’re not simply paying the minimum payment).

The key is to build a budget that starts with these three areas: 1. Giving, 2. Saving and 3. Debt reduction. Once you’ve made your commitments there, you’re well on your way to creating your financial “safe zone” and can move on to what we call “lifestyle” expenses in sections 4 through 8 (cars, eating out, clothing, food, entertainment, housing, and so on). By making commitments to giving (first fruits), saving (best defense against loosing a job is to have 3-6 months of living expenses in savings) and paying off debt, you are ahead of 95% of America, including I might add, nearly ever city, state and federal government!

Talk about peace of mind!

And notice one other thing: The priorities in our budget are the exact reverse of what our consumer culture wants us to do. Our society wants us to focus our spending on lifestyle expenses (i.e. money buys happiness). So we are told to consume, consume, consume, and when we’re out of money, borrow, borrow, borrow to keep it going. No emphasis is placed on saving (hence our nearly non existent savings rate) and giving ends up being an after thought at best (we give what’s left over rather than from our first fruits). Can’t go any further into debt? No problem. Declare bankruptcy and start the whole process over again. (Come to think of it, our governments is basically doing!)

So a budget then, is a way to turn society’s values upside down. Instead of living on the edge, we live within our means, make giving and saving a priority and saying no to debt. And by the way, isn’t that what Jesus was always doing? Turning society’s value on their ear? I mean really. Can you imagine Jesus maxing out his credit cards or needing to rent extra storage units just to hold all the stuff he's not using?

So give it a try and let me know how it goes. In addition to the budget form, you might want to check out http://www.mint.com/ or http://www.quickenonline.com/ for free, online systems for tracking your spending and keeping to your budget.

Chris Harris is Canon for Congregational Development at St. Paul’s Cathedral and can be reached at harrisc@stpaulcathedral.org