Blueprint for Financial Planning

Sometimes, it seems that all of the financial news is negative. There are stories of market meltdowns, bankruptcies, and foreclosures. Home values and 401(k) balances have fallen. Many overspent. Risky behavior seems commonplace. Short selling, credit default swaps, and derivatives—the array of confusing financial terms is overwhelming. Panic seems to reign at every level of business and the government. We are told our entire economic system is on the brink of collapse unless there is a bailout—funded by taxpayer dollars.

Your immediate need is to provide for your family. You also feel a responsibility to prepare for retirement. Yet it seems that, due to somebody else’s poor judgment and greed, your security is in jeopardy. Take heart! There is good news—there is a set of principles we can follow that work in good times and bad. As a starting point, here is a blueprint for financial planning from the Bible:

Have a plan. “Good planning and hard work lead to prosperity, but hasty shortcuts lead to poverty.” (Proverbs 21:5)
Avoid debt. “The rich rules over the poor, and the borrower becomes the lender's slave.” (Proverbs 22:7)
Spend less than you earn. “The wise have wealth and luxury, but fools spend whatever they get.” (Proverbs 21:20)
Save for the future. “Take a lesson from the ants, you lazybones. Learn from their ways and become wise! Though they have no prince or governor or ruler to make them work, they labor hard all summer, gathering food for the winter.” (Proverbs 6:6-8)
Diversify. “But divide your investments among many places, for you do not know what risks might lie ahead.” (Ecclesiastes 11:2)
Exercise self-control. “…and in your knowledge, self-control, and in your self-control, perseverance, and in your perseverance, godliness.” (2 Peter 1:6)
Focus. “For where your treasure is, there your heart will be also.” (Luke 12:34) Focus your giving on building the Kingdom!

When do these principles apply? Always. They are timeless. Rich or poor, they work. They guide the seasoned veteran and the novice investor. Even during economic uncertainty, they provide stability. Use God’s Word as a filter for everything you do—it’s the best plan.

The views are those of Bruce Olmstead and not those of Summit Brokerage Services. Investments in securities do not offer a fix rate of return. Principal, yield and/or share price will fluctuate with changes in market conditions and, when sold or redeemed, you may receive more or less than originally invested. No system or financial planning strategy can guarantee future results