Words Of Life Ministries, Inc.

24148 Iowa Rd

PO Box 652

Lebanon, MO 65536

Located in downtown Sleeper, MO

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BIBLE-BASED FINANCIAL GUIDANCE

FINAL THOUGHTS....For Now

by Jerry Dewey

     Part 1  Part 2  Part 3  Part 4  Part 5  Part 6  Part 7  Part 8  Part 9  Part 10  Part 11  Part 12  Part 13

           Wow, what a year 2008 turned out to be, especially the last quarter.  With every new day, it seemed like the economic news was worse than the previous day’s news: banks and businesses were failing and going out of business, unemployment claims and home foreclosures were rising dramatically, investors’ portfolios lost 40-50 percent, and several fraudulent investment schemes were uncovered.  Will 2009 be more of the same, get worse, or will we see a dramatic turn around?  There is a wide range of opinions being offered by every economic “expert”, but no one knows for sure.  What does your economic situation look like now and what will your economic situation look like in the future?  The answer largely depends on whose economic principles you were practicing in the past and whose economic principles you plan on practicing now.

          In God’s economy, there is no such thing as a recession.  If you have been practicing all of God’s financial principles for substantial period of time, you should have a better than average chance of not experiencing any devastating or long-lasting negative effects as a result of the world’s economic woes.  Unfortunately, those of you who just recently began practicing God’s financial principles will probably experience some negative effects in your economic situation.  It’s not because God’s principles don’t work; it’s because not enough time has elapsed to totally reverse the negative consequences of practicing the world’s financial principles.  Whichever situation you find yourself in, now is not the time to abandon God’s financial principles.

          Even though we’re two months into the new year, now is a good time to evaluate what you did last year; find out what worked and what didn’t, then make any adjustments to those things that didn’t work to see if they will work for you this year.  You will probably find it less stressful by making smaller adjustments or tweaks now, and then see how things look 3-4 months from now; you may also find it is necessary to tweak some of the things that worked to compensate for the tweaks you make to the things that didn’t work.  This is also a good time to set new short-term goals, and, if necessary, make adjustments to your long-term goals.

          We continued practicing all of God’s financial principles throughout the fourth quarter of last year; everything went as planned or better.  The only thing we “missed” on was our goal of positive growth every quarter; our growth for the last two quarters of 2008 was negative, which caused an overall negative growth for the year.  The negative growth was caused by the huge devaluation of our stock market-based investments/assets.

                    As I wrote in Part 13, through the first three quarters of 2008, the three major stock indices had a combined average loss of 20.0853 percent (the DOW lost 18.1997 percent, the NASDAQ lost 21.4891 percent, and the S&P 500 lost 20.5672 percent).  Things didn’t get any better in the fourth quarter.  The indices lost more in the fourth quarter than they had lost through the first three quarters; naturally, the combined average loss was higher as well.  The DOW lost 19.1165 percent, the NASDAQ lost 24.2661 percent, and the S&P 500 lost 22.5582 percent, for a combined average loss of 21.9803 percent.  For the year, the DOW lost 33.8371 percent, the NASDAQ lost 40.5406 percent, and the S&P 500 lost 38.4858 percent, for a combined average loss of 37.6212 percent. 

                    The huge loses in the stock indices caused a loss in the overall value of all but one of our stock market-based investments/assets.  The loss in our portfolio’s value wasn’t as bad as it could have been because we continued investing in them which increased the number of shares we own in each asset; in addition, we automatically re-invest all capital gain and dividend payments, which also increased the number of shares we own.  However, the increases in the number of shares we own weren’t anywhere near enough to offset the loss in the net asset value (the price per share) of each asset.

                    There is a silver lining in this down market (most people overlook it because they only see and stay focused on the immediate situation – the value of my portfolio is half of what it was): since we haven’t changed the amount we invest in each asset, we are buying almost twice as many shares of each asset as we were.  Therefore, when and as the market recovers, we will see a “better than normal” growth in our portfolio.

          Our spending for the fourth quarter and our overall spending for the year:

                     As I mentioned in an earlier article (Part 10), we use the previous year’s overall spending percentages for our next year’s budget percentages, so our budget for 2009 is set.  We will have to tweak the percentages in one or more categories to bring us up to 100 percent, but for now, I’ll leave them as they are; there is nothing wrong with having budgeted unallocated resources in your financial plan.  In addition, we may lower the savings percentage, which ended up being almost six percent higher than 2008’s percentage.  The substantial up tick in our savings percentage was due to some additional investing in our non-retirement supplemental assets.  We decided to take advantage of the much lower prices per share by using some of the previous quarters’ unspent money and money that was in “safer” instruments to buy more shares of these assets (that’s why our savings percentage for the fourth quarter was 33.9238 percent, which was more than 10 percent greater than our budgeted percentage).

          Do God’s financial principles work?  Absolutely!  As long as you observe and faithfully follow all His principles, God will watch over your financial situation.  Does this mean you will be totally insulated against the negative effects of the current economic crisis?    In his book Finding Financial Freedom (pg 21), Grant Jeffrey wrote, even though God “watches over each of His followers”, it “does not guarantee that [you] will never suffer a devastating” event; however, you can be confident that nothing can or will happen in your life that God doesn’t allow or without His knowledge.  The thing you have to guard against is giving up based upon the atmosphere of fear and panic everybody, from the President on down, keeps talking about.  Grant Jeffrey made this observation, “In these uncertain times, it would be easy for Christians to lose their sense of peace under God’s protection and surrender to despair over the potential economic upheavals facing our world.”  The best thing you can do is ignore all the negative reports (whose report would you have believed, that of Joshua and Caleb or the other 10 spies [Numbers 13]?); if you can’t ignore them, quit listening to them.  The worst thing you could do is panic and quit.  Galatians 6:9 (Amplified) says “…let us not lose heart and grow weary and faint in acting nobly and doing right…”  As long as you remain faithful, your financial prosperity and economic destiny lie in God’s hands; as soon as you quit, God removes His hand of protection and you immediately open the door for the devil to walk right through and wreck havoc in your life and financial situation.  When you quit, there are devastating consequences you will go through (see Deuteronomy 28:14-67).  These results are far worse than the consequences and the results you may go through even though you stay faithfully committed to God's financial principles.  Remember, God is no respecter of person; in Genesis 26, Isaac went through the famine and in Matthew 5:45 (NLT) it says, “For he gives his sunlight to both the evil and the good, and he sends rain on the just and the unjust alike.”  In addition, God may remove His hand of protection, like He did with Job, as a test, so you have a testimony after you go through.  As Galatians 6:4 (Amplified) says, now is the time for every Christian to “…carefully scrutinize and examine and test his own conduct and his own work” to make sure every phase of their life lines up with the Word of God.  As Proverbs 16:3 (Amplified) says, “Roll your works upon the Lord [commit and trust them wholly to Him; He will cause your thoughts to become agreeable to His will, and] so shall your plans be established and succeed.”

             If you would like more information, click on the Contact link and send us an email; someone will contact you shortly thereafter.

     Part 1  Part 2  Part 3  Part 4  Part 5  Part 6  Part 7  Part 8  Part 9  Part 10  Part 11  Part 12  Part 13

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