Matt Bell

Personal-Finance Speaker and Writer

Summary: Renown speaker and writer gives financial advice on how to manage money well during these tough economic times, and to rethink our use of money, to rediscover God’s purposes for our lives, and to reorient our use of money around these purposes.

DS: Is your financial advice changing in light of the current economic environment? If so, how?

Matt: There’s only one change I’ve made in my teaching. I used to encourage people to keep three-to-six months’ worth of living expenses in an emergency fund. Now I believe the starting point should be six months’ worth of living expenses. With so many people out of work and so many others at risk of losing their jobs, this economic season is showing us how bad things can get. Having six months’ worth of living expenses set aside is essential for being prepared to withstand a period of unemployment.

DS: What fear-based mistake do you see people make in times like these? What is something people can do to avoid that?

Matt: The answer is contained in your question??they are succumbing to fear. Making decisions based on emotion usually leads to bad decisions, like pulling all of your money out of the stock market.

One way to avoid succumbing to fear is to be reminded of God’s promises. We can rest in the knowledge that God knows our needs and he promises to provide for us (Matthew 6:25-34). So, there’s a strong faith component to overcoming fear in the midst of our tough economy.

But the Bible calls us to both faith and action. There are many practical steps people can take with money to lessen their fear. One, as I mentioned, is to maintain a healthy emergency fund. Another is to use a budget to gain an understanding of where their money is going and to be proactive in making wise choices. And one more has to do with people’s jobs. One of people’s greatest fears right now is the fear of losing their job. While there’s no such thing as guaranteed employment, there’s a lot we can do to shore up our employability by taking continuing education courses or simply keeping up with the latest books in our field. Many companies will even cover the cost of additional education. About 80 percent of large employers offer educational assistance such as tuition reimbursement, and yet fewer than 10 percent of eligible employees take advantage of that benefit.

DS: What are some practical steps people can take to get out of debt?

Matt: The first step is to stop going any further into debt. Take your credit cards out of your wallet or purse. You might need to cut them up. Or some people put them in a bucket of water and then put that bucket in the freezer. Just do what it takes to make it really tough to go any further into debt.

The next step is to fix your payments. A lot of people think they need to find extra money to put toward their debts if they’re ever going to get out of debt. That’s helpful, but you can really speed up the process of getting out of debt without paying anything extra. Here’s what I mean by “fixing” your payments. Let’s say you have a $2,000 balance on a credit card that charges 18% interest and requires you to pay 2% of the balance each month. If you don’t charge any more on the card, and you keep making the minimum required payments, then each month your minimum required payment will decline a little bit. This month you’ll owe $40, but soon enough you’ll owe $39 and then $38 and on and on. Paying this declining minimum required payment keeps you in debt for a very long time. In this case, it will take over 30 years to pay off that $2,000 balance and you’ll pay nearly $5,000 in interest. But if you just fix your payments at $40 per month, you’ll be out of debt in less than 8 years and you’ll pay less than $2,000 in interest.

DS: What is a question Christians are asking you about finances these days? How do you answer it?

Matt: I’m getting a lot of questions about borrowing against a retirement plan or home equity. So many people are struggling with their finances right now, and that has them looking to what seems like ready sources of cash. I strongly discourage such moves. Quick fixes often turn out to be more damaging than helpful. There’s usually much more that people can do to better manage their spending, and taking that approach leads to better long term results.

DS: Who was most influential in helping you practice biblical principles of money management? What is one thing that person did that you particularly remember?

Matt: The first person who ever taught me what the Bible says about money??a lay leader in a stewardship ministry at the first church I attended. I remember being impressed with how knowledgeable he was and how easily he could answer people’s questions. Clearly, this guy knew his stuff.

But what really impacted me was the way he lived his life. By outward appearance, he looked like he was probably a middle class person??he dressed modestly and when I saw him in the church parking lot one day I noticed that he drove a modest car. So, I was surprised when I found out that he earned an unusually high income. Later I found out that he gave away an unusually large portion of his income to his church and other Christian organizations. He viewed his ability to earn a lot of money as a gift and he was intent on using that gift for God-glorifying purposes.

He taught me a lot in his seminars. But he taught me even more through the example of how he lived his life.

DS: Do you ever find it difficult to practice a biblical financial principle? What helps you overcome that?

Matt: If I’m really honest about that, I have to say it is trusting in God’s provision. In the summer of 2005, my wife, Jude, and I made the decision to have me step down from a well-paid corporate job in order to follow what we both felt was God’s call on our lives to have me write and teach about biblical money management full-time. I spent much of the next two years writing “Money, Purpose, Joy.” During those two years there were moments of deep discouragement and doubt. I would go down to the basement day after day to write, with no guarantee that the book would ever be published. And I wasn’t getting a paycheck every two weeks. With two young children at the time (we now have three), I sometimes wondered whether I had taken my family down a bad path.

I remember one especially discouraging day when I was expecting a call back from a prospective publisher. The call never came. Jude knew I was really down, so she reminded me of the words in Matthew 7:9-11: “Which of you, if his son asks for bread, will give him a stone? Or if he asks for a fish, will give him a snake? If you, then, though you are evil, know how to give good gifts to your children, how much more will your Father in heaven give good gifts to those who ask him!” Those words were so comforting. They reminded me that, while God didn’t promise to provide a publisher, he does promise to take care of us.

Eventually, I became represented by a great agent and then signed with a great publisher. Many people that I admire endorsed the book. With each door that opened I saw how God’s provision often goes beyond what I could even imagine. Still, there are times when I find myself wanting more assurance, wishing I could see a bit further down the road. But I can tell you this—I’ve never felt more alive. And I know that had we chosen to play it safe, it would have been one of my life’s greatest regrets.

DS: What can believers do to help one another practice biblical money management in the current economic climate?

Matt: We can talk with each other about money. Money has become one of the most personal, private topics in our culture. We could be in a small group with people we think we know really well and have no idea that they’re struggling with a financial issue. A small group setting is the perfect place for discussions about money. What it takes is a small group leader with the courage to open up such a conversation. Sometimes what stands in the way is the leader’s sense that his or her finances have to be in perfect order. They do not. In fact, it’ll foster more openness among other group members if leaders share some questions, concerns, or mistakes they have made with money.

DS: Is there anything else you would like to communicate to our readers?

Matt: It used to be that when I met someone with a lot of debt and little savings, I thought they had simply stretched themselves too far. I thought the answer was to cut back. But over the years I’ve come to see that in many cases the opposite is true. We’ve been settling for too little. We’ve been settling for the assumption that carrying balances on credit cards and financing vehicles is normal, unavoidable. We’ve been settling for the assumption that it’s impossible to save. And mostly, we’ve been settling for life as consumers, believing that we need more (money, stuff) in order to be more (likable, worthy, satisfied). By following our culture’s teaching about money, we’ve been settling for lives of heavy debts, light savings, too much stress, and too little joy.

I hope that this tough economy will have more of us than ever turning to God’s word for reassurance. But even more, I hope that our current difficulties will prompt more of us to rethink our use of money, to rediscover God’s purposes for our lives, and to reorient our use of money around those purposes.

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July–September, 2009

Money Management