Mine, Ours or His?

Scriptures: 1 Chr 29:11-12; Lev 25:23; Psalm 50:10-12; Haggai 2:8

When you refer to possessions, do you say: this is mine or this is ours? Or does it all belong to the Lord?  Can we say anything belongs to us? 

One of the first words a two year old will say is mine! And it seems for many of us (including me) we carry this opinion (attitude) throughout life.  And it is this opinion that is challenged after you are married.  After all, isn’t everything ours now, not yours and mine?

But are either of these opinions, mine, yours or ours, correct?  Scriptures would say no.

When we consider the fact that we can’t take it with us when we die, do we really own anything?

For most of us, the notion that we don’t own anything is hard because we are surrounded by stuff!  We live in nice houses, we have cars in the driveway, we are entertained by all of our electronics and we wear lots of cool clothes.  But really, are all these things ours or are we simply stewards for all of these things?

The notion of being a steward is often foreign to us.  When you look the word up in the dictionary, we read that a steward is a fiscal agent or one who actively directs affairs: MANAGER.  How we spend our money (or should I say: the money the Lord has entrusted to us), this corresponds directly with our attitude toward the money.  If the money is His, then we might spend it differently.

Now don’t jump to the conclusion that I believe that the Lord doesn’t want us to enjoy the money He provides to us.  I believe He does and when we do so, He feels the joy of having blessed us.  The only point that is important to remember is that none of it belongs to us. 

In one of the first exercises in a Crown’s Financial Small Group, the participant creates and signs a Quit Claim Deed.  This deed turns over to the Lord everything they may have incorrectly assumed was theirs.  Often, the house, cars and other possessions are placed on the deed, which “transfers” ownership back to the Lord (as if they were ours to begin with).  This is a very important first step in transforming our attitudes toward possessions. 

So, why is this an important attitude (everything belongs to the Lord) to hold true?  Well, I believe that if nothing is mine, then when it’s taken away, while I will be sad or disappointed, I can still praise the Lord.  And this is very important to me!  Is it for you?

Furthermore, knowing that it all belongs to the Lord helps me learn contentment.  I stress out less when I know that the Lord is in control and not me.  And when I can trust the Lord to provide for my needs, I am indeed content!

Everything in the heavens and earth is yours, O Lord, and this is your kingdom.  We adore you as being in control of everything.  Riches and honor come from you alone, and you are the Ruler of all mankind; your hand controls power and might and it is at your discretion that men are made great and given strength.” 1 Chronicles 29:11-12 TLB

Vampire Costs

Scriptures: 1 Cor 3:15,18; Prov 16:3

Do you know how much you pay each month in bank fees?  Credit card fees?  Late fees?  Are there ways to reduce these expenses that eat away at your monthly income? 

My use of the term vampire costs is adapted from the electric utilities.  That is, there are appliances in our homes that use electricity even though they are turned off – and so they suck power all of the time. The simplest remedy for these kinds of appliances is to unplug them when they are not in use. 

When I apply this term to banking, I ask the question: Are your funds sucked away for things that can be avoided, like unplugging the appliance. And the answer is yes – if you are mindful of these charges.

I will always say, do your due diligence when investigating a bank or credit card.  You have to read the fine print too!  Knowing what they will charge for and knowing what the requirements are for free privileges is important when it comes to fees that can be avoided or totally eliminated.

Banks could charge you for each transaction conducted with a teller, ATM transaction fees (both in and out of network), check writing fees, insufficient funds fees, online banking fees, minimum balance fees and fees they are yet to invent.  And with so many fees, it is important to know which ones you are paying each month. So be sure to examine your monthly statements for these vampire costs.   

Now don’t forget to annualize this expense. It would be easy to say, well, its only $10/month.  When you annualize your expenses, you may think differently.  Fees that are only $10 per month now become $120 per year.  This starts sounding like a bigger chunk of change and you will quickly find yourself asking: How can I avoid these charges?

Avoiding some bank charges is accomplished with minimum balances.  Free checking is possible if you keep a minimum balance in the account.  And even better, interest bearing checking accounts are not only free but your funds also accumulate interest on the monthly balance.  But the kicker is that you must maintain a minimum balance.  If you don’t there can be high fees levied on your account.  Bottom line here is simple: Avoid these costs by maintaining the required minimum balance!

All of this may sound like duh, isn’t this common sense.  And my answer is yes but I will bet you will be surprised first by how much you are paying for bank fees, followed by I need to be more careful. Again, it’s like that appliance that sucks electricity even while it’s off – duh, all I have to do to save money is to unplug it.  So, start unplugging those bank fees today!

The same holds true for credit cards.  You must ask the question: What are you paying in fees each year that can be avoided? 

Late fees, annual fees, cash advance fees and more could find their way to your credit card bill each month.  All of these are avoidable when you plan to spend your money by avoiding these unnecessary charges.

Don’t let the banks and credit card companies suck your hard earned money out of your wallets!  Be mindful of all of these fees and move to a different bank or credit card company if there are no easy ways to avoid paying their fees. There is plenty of competition out there and I’m sure that you can find an institution that will meet your needs. 

Lastly, if you switch to a new bank or credit card, be mindful of “sign on now” pricing that could change in three, six or twelve months into your relationship with the institution.  You have to remember that there are no free lunches out there and so you have to look to where and how charges or fees will creep into your account.

Leaving Money on the Table

Scriptures: Prov 3:13-19; Prov 24:3-4; Eccl 7:12

Do you reduce your food costs on a regular basis? And what about your clothes, do you pay more than you have to?  Is there a way of spending less without buying less? 

Imagine walking into a room and there is a big pile of money on the table with a note that states: Please take; it’s free!  Would you walk away from that table without taking any of the money?  Would you only take some? Or would you take all of it? Yet, this is what you are doing when you don’t use cash incentives offered by manufacturers!

What am I speaking of?  There are many companies that offer coupons and rebates if you purchase their product.  These incentives are for us to take advantage of and many of us don’t, which is tantamount to leaving free money on the table. 

Yet using coupons during your weekly visit to the grocery store does require a little planning on your part and a little more comparison when you are in the aisles.  But savings can amount to tens of dollars on your grocery bill each week!  You just have to plan on using the coupons.

Planning is essential to achieve success in plenty of tasks and saving money is no different. And this success begins with planning your meals for the week.  Leaving to whim your food purchases while you are in the store is a recipe for spending more money than needed.

Once you have a plan, make a list to buy from. When you are in the store, stick to your list.  Avoid the temptations of the spontaneous purchases. One of my favorite Scriptures for temptation is 1 Cor 10:13 because it speaks to God’s faithfulness in providing a way to escape the temptation. 

Now coupons are great but they don’t always realize the expected savings you are seeking.  Be sure that you compare similar products to the one you have a coupon for.  Buy the product only if it is equal to or less than the other brands. 

Now you may say that clipping coupons and using them takes lots of time, too much time.  To you I say: this may be true when you first start the process, but it really doesn’t take much to get good at it.  Clipping coupons can be done when watching TV during the commercials you don’t want to watch anyway.  And when you are in the store, comparing two or three products gets faster each time you do it. 

Now I have focused quite a bit on food purchases because we buy food each week.  Yet there are other products that we can use coupons or receive rebates with the purchase. 

There are coupons for eating out at restaurants (my best is for my favorite pizza parlor), rebates for home improvement products and most of the time sales on your clothing purchases.  What is essential for all of these kinds of savings is seeking out the savings. 

Be patient and plan your purchases.  If you know that you will need a new pair of shoes in about a month, start looking for sales today.  If you have to, wear your shoes a bit longer until the pair you want goes on sale.  Saving money requires patience and diligence. 

Lastly, I will say that saving money by using coupons can be addicting.  You will get a rush when you know that you needed something and didn’t need to pay full price for the item.  And this is cool, very cool.

So I want to leave you with a challenge.  My challenge to you is to save at least $30 from your food bill in December.  And if you do, you will be hooked! 

Retirement – Can it really happen?

Scriptures: Numbers 8:24-25; Mathew 6:31-34; Ecclesiastes 11:2

When should I start saving for retirement?  Should I be debt free before I start?   Is retirement even a part of God’s plan for you?  How can you be sure that you will have enough to cover your needs as you get older? 

The short and sweet answer is as soon as you can!  To save your money in an IRA, there are some rules (age 18 and must have earned income) that you have to comply with in order to take advantage of tax benefits.  I don’t plan on discussing these tax topics in this article, but you may be asking: what are the advantages to saving earlier rather than later? 

The simple answer here is compounding or should I say the power of compounding.  When you place money in a savings account it will collect interest.  This interest is typically posted to your account monthly. The following month, you will have not only what you deposited but also the interest that was deposit by the bank and so that at the end of the second month you are collecting interest on the sum of these two amounts, and so on. This is compounding; your initial deposit plus all of the interest is always collecting interest.  Sort of like a snowball rolling down a hill continually collects snow. 

When you open a savings account in a bank, you will see two rates of interest; the interest rate that is applied monthly and the APR or the Annual Percentage Rate.  The APR is the equivalent interest rate if all you received was interest payment once per year, rather than monthly.  So, the APR will always be higher than the monthly interest rate. 

Note: You should always check to see when the interest payment is posted to your account.  Some accounts post monthly and some quarterly.  If the interest is only posted quarterly, the APR will be lower. 

There is a classic example that demonstrates compounding.  Two investors choose two different savings strategies. 

·         Sally starts saving at age 21 and saves $1000 per year for eight years and then stops. 

·         Bobby starts saving at age 29 and saves $1000 per year for 37 years. 

·         Both examine their savings account at age 65, both of which were collecting 10% interest (yes I know that you can’t find this rate today but this is an example). 

·         Who has more money?

o   The answer is Sally!  She has $427,451 in her account and she only invested $8000.  Bobby has $363,043 and invested $37,000. 

o   This is the power of compounding!

Bottom Line: Start saving for retirement as soon as you can!

Though, the very tough question to answer is: How much money should I save for retirement?

Realize there are many factors that go into answering this question, such as:

·         How long will you live past 65?

·         What will inflation do to the cost of living and consequently to my savings?

·         Will you be healthy in old age or will you have costly medical expenses?

·         How much do you think you will spend each year?

·         Will Social Security be around to supplement my savings?

·         Will Social Security raise its retirement age beyond 65 like some European countries have done in their programs? 

·         If I can still work, how long could I work? (Is Wal-mart still hiring greeters?)

And with so many unanswerable questions, how can you know for sure?  Bottom line is that you can’t know; you can only estimate your needs and plan accordingly. The current estimates are that most people would need somewhere between $1 and $3 million dollars to retire.  And I suspect that these estimates are assuming that Social Security does not factor into your income, since many believe it will be defunct at some point of time in the future.

Given these estimates for how much you need in your retirement savings, again, the bottom line is to start saving as soon as you can so that you can leverage the power of compounding.

Another question that many people ask is:  Should you save when you are in debt? 

I will say yes, but with conditions. You must have a budget that demonstrates that you are spending less than you earn and have benchmarked your budget against reasonable spending habits.

For example, most people don’t buy their first home with cash and so you will have a mortgage.  If this family is living within a reasonable budget and can still set money aside to save for all of their short term debts, then yes by all means, save for retirement. 

But if you have credit card payments where you are paying high interest rates (typically 18% and higher), I would suggest that you seriously consider eliminating this debt before you start saving for retirement.  Yet, if your income can handle the interest payments, you can save and pay those high interest payments too.

Notice that I’m suggesting that your budget should always allow for retirement savings, even though you may have some debt.  Again, it comes down to how well you have constructed (and live by) your budget. If you can plan for the expenses associated with debt, you can actually do both.  But I will leave that to you to decide if that really makes sense. 

Now let me take a step back and ask: Is retirement a Scriptural concept? 

Well, actually, not really, at least for most of us.  When you read Numbers 8:24-25, it was only the Levites (the priests) that were allowed to retire.  Everyone else was expected to work.  Nowhere else in the Scriptures does it suggest that retirement is an option or a path for any of us who are not in the business of preaching or teaching. 

So, if we are not to retire, then why do we need to save for retirement? 

Let me suggest that you are not saving money for retirement but to create career options when you chose to leave your current (secular) job.  That is, many of the career options for doing Kingdom work do not pay very well.  (This is unfortunate in and of itself.) If you have a heart for missionary work or even working in a para-church ministry, then you may want to be saving money such that you can augment your new salary with the savings you have accumulated.  In this, you keep working but are not hindered by your financial condition. (Imagine what could be possible if there were more Kingdom workers!)

Lastly, I will leave you with some questions.  Should we, as Christians, depend on the government for sustaining our needs as we grow old?  What role does God play in our last stage of life in this world? Please do consider Mathew 6:31-34.

For more information about retirement, check out these articles at Crown Financial Ministries. 

Benchmarking Your Budget

Scriptures: Luke 14:28-30; Prov 16:3

Do you spend too much money on food?  Clothes? Your home?  How much money is appropriate to spend on such items for a family your size?  Is there a way to know if your spending habits need some adjustment?

One of the first insights people make when they start looking at their budget in the context of their overall income is that they are spending too much money in one area. For many people, eating out is an area that is often the big surprise. Those gourmet coffee houses do charge quite a bit for a cup of joe!

But let me take a step back here and answer the question: Why should I do this in the first place?  

You may be facing the crisis of cutting your spending in your budget. Maybe it’s because you haven’t been making all that overtime or that you lost your part time job.  Whatever the reason, you have to cut your spending and so you need to start looking for ways to do that in your budget.  The best ways of doing that is to know where you may be spending more money than normal or should I say as compared to others (the essence of benchmarking).

Another answer may be simply that you are searching for ways to spend less so that you can save more or to pay down some debt.  Again, comparing your spending habits to others is a great first step to adjusting your budget.

Lastly, I will mention that every well-run company (even a church) uses benchmarks to evaluate their business.  After all, a company that doesn’t manage their expenses well usually isn’t around tomorrow. So, in many ways, your expenses should be managed in the same way because you don’t want to find yourself in so much financial trouble as to declare bankruptcy.

And so, the math is really simple.  Just take the amount you have budgeted (or the amount you currently spend on a budget category) and divide that by your available discretionary spending money.

For example, say you have, after taxes and tithe, $50,000 in discretionary money. And you want to benchmark your housing costs.  If you spent $20,000 on your housing expenses, you spent 40% of your budget (20,000 divided by 50,000) in this category.  Note that it is important to know what is to be included in each category or, if you will, how it is defined, before you start your comparisons.  You don’t want to leave out or include an amount that isn’t in the number you are comparing yourself with.

Typically included in the Housing category are: the mortgage/rent, utilities, insurances (home or renters), maintenance, and any major furnishings that are expected to be purchased in a year that would stay with the house (e.g. dishwasher).  When you add all of these items up and compare yourself to others, you may discover that you are spending too much in this category.  (Note this is a hard one to fix because you may have bought a house too big for your income and therefore not easily reduced by spending less.)

Entertainment/Recreation is another area where you may discover you are overspending as compared to others.  Items to include here are:  vacations, camping trips, sports (events & equipment), movies, videos (rental & purchase), cable TV, Internet access, pets and eating out.  Obviously, if you are overspending in this area, spending less is easier, even though you may not want to. 

Savings is an area that you may not even be budgeting for!  Remember, savings are nothing more than future spending.  If you expect to spend money in the future, you should be saving.  And I am not just talking about retirement.  I also include that car insurance payment you have to make in six months as future spending.

The overall objective in this exercise is to balance your budget in such a way as to be spending your money as a good steward would, given the same circumstances.  These circumstances are associated with your family size.  For example, are you a single parent or a family of four?  Each family comes with a different set of circumstances

Now, go and get your budget and calculate these percentages.  Then compare your spending/budget to others by checking out Crown Financial Ministries’ benchmarks for a family your size.

Singles         Single Parent           Family of Two (Married Couple)   

Family of Four         Family of Four (High Housing Cost Area)          Family of Six

When you identify an area where you should be spending less (your percentage is higher than the benchmark), establish a new budget amount that is aligned with the benchmark amount.  If there are categories where you should be budgeting more money (e.g. savings), you have to take that money from other categories. It’s that simple – at least on paper.

Now before you say that you can’t spend less in one category versus another, I will challenge you by asking: Really?  (Note that I am not challenging those facing medical issues or circumstances beyond their control.)  There are always ways of spending less money in a category of your budget. What you may not like is doing so.  And here is when you have to ask: Is this an attitude problem (heart issue) or not?  Again, no one likes being challenged this way but if changes to your spending are called for, you have to go down this road.

Bottom Line:  Benchmarking your budget is great way of evaluating your spending plan to others who successfully manage their income.  And who wouldn’t want to do that?

Now I don’t normally speak to the tithe but I feel compelled to do so since it is critical to the benchmarking process, not to mention that it’s a benchmark percentage as well.  The benchmarking process starts with your discretionary spending amount; your discretionary money amount is your gross income minus your taxes and tithe.  Please be sure you carefully examine your tithe amount before you begin your overall benchmarking.  For a higher amount in your discretionary spending will yield lower percentages in each of your budget categories, suggesting you may be in line with others who tithe at a higher amount than you.

Statistics show that evangelical Christians only give 2-3% of their gross income to the church.  What good would happen in God’s Kingdom if Christians gave more to their church? 

If Only I Was Promoted

Scriptures: Ruth 2:12; Col 3:23; Ps 75:6-7

Are you unhappy in your job because of the salary you make? Have you ever felt that if you were promoted to a new position, you would be making more money and therefore not be so strapped for money? 

If you are asking yourself these questions, I will have to ask you: What is causing you to ask these questions? And more often than not, the answer I receive is: I have too many bills to pay. 

Not having enough money to pay your bills is usually a symptom of uncontrolled spending. Now sometimes the issues are legitimate, such as unplanned medical expenses, but this is generally not the case for most people seeking more money thru their work.

So, before you get that new job that pays more money, I recommend getting a good handle on your spending habits and start operating from a balanced budget.  If you have not put in place appropriate levels of spending for your current income, then having more money only gives you the opportunity to get deeper into trouble.  You have the fix your habits before you make more money.

So, let’s say you have straightened up and getting out of debt has become a priority for you. GREAT! 

At this point, you have several options to consider for eliminating debt through making more money.

1.    Find a part time job that you use to pay down your debt using such techniques as a debt snowball (see my previous blog postings). And when you have paid off the debt, then feel free to resign from that job because you will have achieved your goal.  But be sure that you also have built up a cash reserve to handle emergencies before making your exit and you are working off a sound budget. 

2.    Make sure you are being the best employee you can be in your current job.  Employees who can demonstrate outstanding performance could find themselves on the receiving side of a bonus or a raise.  One way to do this is to help your company save money.  Helping your company manage their expenses may mean the difference between saving your job because of such great cost-saving ideas or by cutting your job as the alternative.  Lastly, remember whom you serve as a Christian.  If in doubt, read Colossians 3:23. 

3.    Update your resume.  Be sure to have your spouse or a friend review it.  If your friend is a hiring manager, even better since in today’s job market they have reviewed hundreds of resumes and they know the good, the bad and the ugly of resume presentation.  And I recommend being very selective with applying to new positions.  Don’t come across as being desperate for a new job by blitzing every job that you can.

4.    Don’t get discouraged in your search for a new job.  If having a new job is the Lord’s will for you, it will happen.  Personally, I have applied to several job opportunities within my company over the past few years and I wasn’t selected for any of them.  The interesting thing about this is that every one of these positions (say one) no longer exists!  And so while I was disappointed with the not receiving the position, I had to trust the Lord with the decision.

Now you may be interested in making a complete career change, head in a new direction.  This could be a good thing or a not so good thing.  The important thing to ask yourself is: Will this new direction be a good thing for me?  To help answer this question, you may want to check out Crown’s Career tools by clicking here.  On this page, you will find a free online assessment that can help you make this very important decision. It is definitely worth a little investment of your time and money to be sure the new direction for your life.

Used and Still Going Strong

Scriptures: Malachi 1:13; Acts 5:1-10

When is donating other than money to a charity worthless?  When would it be considered less than Godly?  Shouldn’t we always donate the best?

Donating goods to a charity is an alternative to giving money.  The charity can then sell the donated item and use the cash within their ministry.  For example, you can donate a piece of furniture you no longer want or your car that you choose not to sell.  Donating goods is also tax deductible, which is why so many of us do it.

But for all charities, the goods should be in good condition, gently used as they like to say in the trade.  Yet, one of the fullest dumpsters in town is the one associated with the Task Force, Castle Rock’s local thrift store and food bank. This is because what is being donated is not worthy of being sold. 

Most of you probably receive the monthly phone call from groups like ARC or the Vietnam Veterans Association stating they are going to have a truck in your area to pick up any items you want to donate. Now, if you have ever taken them up on their offer, you may have discovered that they won’t always take what you are willing to give up. That’s because they only want items they can sell and if the item is in poor condition, they won’t take it. At times, this is aggravating because now we have to arrange to have it hauled away by our garbage company, but isn’t this the way it should have been in the first place.

And many churches have had to create policies for doing the same thing as these charities.  Ministry leaders have been turning away items that people are willing to donate because the item is junk.  Prior to these policies, donations like this moved the burden of disposing of the item from the donor (and I use this term loosely) onto the church. 

The passage in Malachi really speaks to what is happening at too many charities and churches in our towns, states and country.  Too many of us are stretching the notion of what is gently used just so that we can claim a tax deduction for what is truly our garbage.  And yes, this is a harsh statement but it is true and I have to admit I have done this in the past. 

 Yet, as you mature as a Christian, you have to put off the old self and seek to improve your actions.  You have to stop doing things that aren’t becoming of your new self.  You should not lie to yourself by saying “someone can still use this” and admit that the item has exhausted its useful life and needs to be dumped.  And I won’t mention how wrong donating something that is really garbage just so that you can claim a deduction on your taxes – okay I just did; it’s wrong and shouldn’t be done.

Bottom line:  If you wouldn’t want to give it your best friend or your mother, then it probably belongs in the trash. 

Now for the truly gently used items that are worth donating to a charity, you can in good conscience know that you are doing a good thing.  The organization will put it to good use for the ministry that they are engaged in.  After all, this is why you have chosen to donate to them; you want to support their efforts.

When you donate a non-cash item, you will want to receive a receipt for your donation.  The charity will typically describe what is being donated (if the item is difficult or complex to describe, you will want to have this description prepared for them) but they won’t place a value on the item; this is for you to do, which is based upon what you know the fair market value of the item is – but be careful as this too is a slippery slope. 

Lastly, I encourage you to shop in the thrift stores in your area.  The items you purchase are not only at bargain prices but the cash you spend helps the charity perform its mission and pay its bills.  For example, the Task Force uses cash from its thrift store to buy perishable foods that it supplies are part of its food bank. 

So, the next time you want to buy a book for your next vacation or some clothes you want to use for painting the house, think about your local thrift store – you are not only being frugal but you are supporting a good charity! 

Provisions – Your Role and His

Scriptures: Ps 37:25; Prov 22:3; Prov 27:12; Rom 13:1

Home insurance, life insurance, auto insurance, health insurance and the list goes on & on!  When do I trust in God for His provision & protection and when to I buy insurance?  Or is it really that I need to do both? 

You have heard me say that everyone should have enough money saved to handle emergencies.  At a minimum you should at least $1000 saved and the more the better.  Yet, there will be a time when your savings are not enough to cover the emergency and that’s why there are insurance policies. 

The problem though is that insurance it typically left out your budget.  And in many ways this is not a wise way to prepare for major emergencies.

Home owners insurance is required if you have a mortgage on your home.  The premium is collected as part of your monthly payment to be deposited into an escrow account and protects the bank against catastrophic loss to the property.

If your mortgage loan to home value is greater than 80%, that is you put down less than 20% to purchase your home, you are also paying private mortgage insurance too.

Health insurance is what we come to expect of your employer. The policy handles many of the unexpected costs associated with health issues. 

Auto insurance is required by law as a matter of driving your car.  Most auto policies have elements to protect the asset (collision) and the victims of their injuries or loss (liability).

And each of these insurance policies is to protect you and your assets while you are in this world.  Life insurance is to take care of those you leave behind. In essence, insurance helps us hide from trouble (Prov 27:12). 

So, when does having no insurance become unwise and when does having too much insurance become ungodly? 

Not having insurance is often unwise and sometimes illegal.  God has setup the governments and therefore you can also conclude it is being disobedient to God’s word when we drop your auto insurance.  It is also unwise, as in the case of life insurance, since you will be leaving a large debt burden behind if you have a mortgage or your spouse doesn’t work or at the very least your funeral arrangements (these can cost upwards near $20,000 dollars!). 

Therefore, not carrying insurance is not an option.  You should have some level of home owners insurance (even if we don’t have a mortgage), auto insurance (because it’s the law) and life insurance (if only to cover your funeral expenses).  All others have to be evaluated carefully in light of the question; can you have too much insurance?

Okay, if you should be carrying insurance, is it possible to have too much insurance coverage?  Maybe – If you are buying insurance because of a fear of the future, you may want to evaluate your trust in God’s provision.  If God promises to not forsake us (Ps 37:25), then are you placing too much trust in the world to provide for your needs? Definitely a hard question to answer, and so you may want to use the Five-Why’s technique to dig deeper. 

Now, if you feel that you do indeed trust God implicitly for His provision of the future, you should evaluate if you are paying for more insurance than is necessary. 

Are the ways to save on insurance costs?  Yes!  Here are some ideas for you to consider.

Auto Insurance:  Consider dropping collision coverage for a low value car; provided that your car is not financed. Only Liability coverage is required by law.  Consider raising your deductible.  Be careful not to raise it too high as to not have enough in your savings to cover the deductible. And be sure to check out the kinds of discounts your insurer provides for things like anti-lock brakes; for your children, good-grade discounts and so on. 

Life Insurance: Consider term life insurance.  Also, evaluate the value of the policy.  If you have paid off your mortgage, then you probably don’t need as much as you have.  What isn’t intuitive to most is that the older you get, the less you need to have.  Remember, life insurance is best for covering debts and death expenses.  If all of your debts are paid, then really you only need to consider the life-style of your spouse and funeral expenses. 

Private Mortgage Insurance: This policy can be eliminated when your loan to value is below 80%.  So, paying down your mortgage includes this benefit too.

My recommendation is for you to review your insurance needs every time you renew the policy and after every major life event (new children, children who are no longer living with you (empty nest), moving to a new house, changing jobs, marriages, and deaths). 

For more information on insurance: check out Crown’s insurance article.