“Some things Never Change”
Last year I was able to obtain an original copy of the late Larry Burkett’s classic book, “Debt-Free Living”, published in 1989, and I’m reading it now. Even though it is 33 years old, the principles he taught are rock solid and apply in today’s topsy-turvy world just as they did at the close of the 1980’s.
Burkett shares the stories of several real-life couples, (the names were changed) and illustrates their problems in managing their money and finances. He identifies three personal traits that lead individuals and couples into debt, and as a financial coach/counselor, I see the same traits today. (To be honest, I see my old self in my younger years in these traits. It was like looking in mirror as I read)
1. Ignorance – The majority of young couples in 1989 and today enter marriage with little or no understanding of finances and find themselves overwhelmed by the opportunities they encounter to spend more than they make. Since opposites attract, usually one partner is an optimist, who generally looks toward the future to straighten out any errors or problems in the present. The other spouse is a worrier, who needs stability and security. Dave Ramsey has long taught that in most marriages, one is a “free-spirit”, who likes to spend and worries about the consequences later, and the other is the “nerd” who mostly handles the bills, looks at the numbers, and worries.
2. Indulgence – Impulse buying and get-rich schemes all have the same root cause: greed. I’ve seen many people spend too much of the household income on things that they feel will bring in a large profit, but because they did not truly understand the market/product/process/risk involved, they fail at their “great idea, and the family pays the price for their impulsive actions. Larry Burkett and Dave Ramsey have long taught to never invest in things you do not fully understand, or do not know how it really works. And don’t forget that envy drives indulgent purchases…just because your friend bought a new boat, or a new truck, does not mean that you must have one too.
3. Poor Planning – The main symptom for debt is poor planning; never being trained in finances and no idea on how to set up and follow a household budget. For example, in 1989 when mortgage interest rates were extremely high (10.32% average), in order to qualify for a mortgage and afford the payments, the income for both spouses were included in the approval process. Does this sound familiar? But here is a glaring problem…sooner or later, they want to have children and the wife becomes pregnant…sometimes unexpectedly. (How in the world did that happen?) The wife will have to leave work for 3, 4, sometimes 6 months to care for the baby. The couple does not have an emergency fund, and with only one income, it is too easy to start putting household expenses on credit cards such as food, gas, utilities. baby supplies, and sometimes medical bills. Then when the wife is finally able to return to work there is now a several hundred dollar a month childcare bill. So now the couple has gotten themselves into a debt hole that will be hard to work out of, especially if the other two personality traits have also factored into the financial picture. (This happened in my life, in the 1980’s) Think about this now… what if a couple with some sound financial guidelines from their parents or church leaders, decides to live on the husband’s income for two to three years…continue to rent for three more years, and save all the wife’s income for the baby, a down payment on a starter home that they can actually afford, and a sizeable emergency fund? We are not educating our young people!
As a person of faith, I find it very disturbing that modern day educators are more concerned about teaching our young people everything under the sun (good and bad, but mostly bad) and leave out how money really works and how to manage personal finances responsibly. Larry Burkett complained about it in 1989 and I’m complaining about it now.
The good news is that trained financial coaches and counselors are available today to help couples and individuals work their way out of debt-ridden circumstances. Not by get rich quick schemes, but by education, self-discipline, sacrifice, and time.
Please reach out to us if you are interested in learning more.
Florida Couple Paid Off $190K in Student Loan Debt in 27 Months
Taken from Fox Business News article June 07, 2022 by Brittany Kasko
“I really had no business plan to go to college,” said Florida resident Sherman Merricks. He and his wife were carrying a total debt of over $200,000 – and most of it was student loans.
Merricks graduated with an undergraduate degree in psychology from a private university before continuing his education and earning his master’s degree in biomedical science. Now a small business owner, he said he was only able to pay $300 minimum each month on his loans and fully expected to continue paying that for the rest of his life.
Merricks and his wife have owned and operated a CrossFit gym in Gainsville for 10 years, and later opened a sales marketing firm just months before the Covid-19 pandemic hit. The new business venture took off as people around the nation were starting home based ventures, and the family took this opportunity to drastically pay down their debt. They had also taken Dave Ramsey’s Financial Peace University earlier in their marriage, and credited this for a new understanding of debt and how it was hurting the family.
The family came up with a tight, strict budget, saving everything they could. Every spare dollar went towards paying down the debt. Their kids were involved; every time they paid $1000 toward the debt, the kids would check off a block on a chart they had posted in their home. Soon they started seeing the outstanding balance begin to drop, and this helped sustain their momentum.
They also give the most credit to their faith, and believe they were extra blessed during this time. “I do really feel that was just the Lord’s blessing. He was just blessing our business,” said Christina Merricks.
We are finishing up our first “Flex” Financial Peace University classes in a couple of weeks. In this format, the students watch the videos on their own time from their subscription from the Ramsey + website, and then on Monday evening at 8:00 pm we meet via zoom to discuss the lesson and I answer questions. We will host in-person classes again in the future at our home church, but this Flex format worked well during the summer months.
“Like a city whose walls are broken through, is a person who lacks self control.” Proverbs 25:28 Attributed to King Solomon, the very first financial coach.
This scripture is pointing out that a person who can’t control his spending habits, is leaving his family, home, and future unprotected. Think about it.
Kevin S. Amacker , Founder of Shenayim Group of Mobile
A Ramsey Preferrred Coach (RPC)
251-605-5859 shenayimgroup.mobile@gmail.com
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Coaching is designed to give you accurate and authoritative information with regard to the subject matter covered. We are not authorized to render legal, accounting, or other professional advice. Since your situation is fact-dependent, you must additionally seek the services of an appropriate licensed legal, accounting, or investment service.
Shenayim Group of Mobile shenayim.group.mobile@gmail.com
This information is presented with the understanding that the presenter is not engaged in rendering legal, accounting, investing or other professional advice. If legal, financial, or other expert professional assistance is required the services of a competent professional person should be sought. The presenter has a network of professionals that can be recommended. The presenter works with people to change their spending and saving habits.