Money Management Systems

Joleen wrote about 6 Key Financial Principles yesterday. Stewardship (a broad term which includes money management) is important to us (we believe it’s important to God!).

Because it’s important, we need to be intentional about it. IOW, we need to put some systems in place to help us manage our finances wisely.

I recently read some scary statistics at …

  • Between 1980 and 1991, Americans saved 6.4% of disposable income versus 15.7% by the Japanese.
  • The current generation spends $1.22 dollars for every dollar earned.
  • There are 1.2 billion credit cards in the U.S.
  • We spend 90% of disposable income paying down debt.
  • 1/4 of all bankruptcies are filed by people under the age of 25
  • The U.S. has 6.7 trillion dollars in household debt.
  • 60% of all credit card users carry a balance from month to month.
  • 13% of the population owes $25k or more and carry a balance every month.
  • $15 billion dollars are spent in late fees every year by U.S. citizens
  • 30% of profit from credit card companies is from late penalties.

As followers of Jesus, we have a responsibility to be good stewards of all God’s gifts, including our finances. Simply put, we must honor with our finances.

As we enter a new year, particularly in the midst of uncertain economic times, we all need good money management systems.

Here are the systems/strategies we’ve developed in recent years to help us honor God with our finances …

  • Track all income and expenses monthly in a spreadsheet file (monthly totals are transferred into an annual spreadsheet file). We use other spreadsheet files to track ministry/tax-related items.
  • This spreadsheet file includes a calculation that automatically generates the percentage we set aside for tithes (which we give to West Side and Centre Grove) and offerings (which we each use to support various special offerings and/or other ministries/causes).
  • We develop an annual budget which serves as a good guide for us. It also minimizes (if not eliminates) many money-related discussions between us (e.g. each of us has a designated amount for things like offerings and clothing, so we don’t need to discuss those things; we simply use up to the amount budgeted).
  • We use credit cards to earn cash back not . The “key financial principle” that says to use cash instead of credit cards (see previous post) is not as applicable if you pay your balance in full every month. We use credit cards that offer cash back and have the full balance automatically drafted/paid from our bank account each month (preventing late fees for missed/late payments).

I’ve been considering using an online service like which tracks all bank and credit card accounts in one location; it also generates graphs/reports on where your money goes as well as offering money management tips/suggestions. The one drawback that’s preventing me from using it now, though, is that it still does not allow for manual inputting of cash expenses (as I understand it). I’d also need to be able to break down credit card expenses into categories of my choosing, which I’m not sure is doable yet. Maybe someday, though.

Do you have any money management systems in place? What are they? If not, what systems might you put into place in 2009?

You might also be interested in a couple previous posts: Teaching Good Money Management (to kids) and Shaping a Trustee Culture which was part of a parenting series.

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