When Dave Ramsey speaks, people listen. The syndicated radio host, who has provided tips for people to get out of debt, opened Monday’s General Session with a powerful punch. And attendees at this year’s NACBA Conference were listening.
Ramsey has been at the bottom. After securing a net worth of $4 million at the age of 26, he soon found that he didn’t have the smarts to manage his money properly. With two very young children and his marriage hanging on by a thread, Ramsey declared bankruptcy.
“People ask how you bounce back from that,” he said. “But when you fall that far, you really don’t bounce.”
Ramsey explained that 70 percent of consumers live from paycheck to paycheck, while another 55 percent of Americans “always” or “sometimes” worry about their money. Conflict over money is still the leading cause of divorce today. And of course, bankruptcies and foreclosures are at an all-time high. So how does a church expect their congregation to give? According to Ramsey, it’s really dependent on what the church teaches.
“North American Christians give a little under 3 percent – 2.58 percent – of their income. And this percentage hasn’t significantly changed in forty years,” he explained. “That means churches are operating on a fourth of the budget they should be.”
Ramsey believes that churches need to teach congregations the basic means of managing money. The more the people are educated, the better the situation for them to give. He told attendees to teach their congregations how to set a budget and how to get out of debt.
“The church is trying to harvest from what hasn’t been planted,” he said.
So Ramsey offered some advice to help “plant” a financially sound congregation. He presented five Biblical principles that will change your life and church.
First, teach them to get out of debt. “Proverbs 22:7 says the rich rule over the poor, and the borrower is the slave of the lender.” In order to accomplish this first principle, start with educating the younger population, such as the 20’s or 30’s ministries. Offer classes or seminars to help this demographic. It’s good for the church, and it’s good for their relationships.
“Most young married couples spend the first 5-7 years trying to obtain the financial status of their parents – something that took their parents 35 years to accomplish,” he said. “Nintey percent of divorces of young marriages are caused by finances.”
The second principle to teach is to “act your wage.” Don’t spend more than you have. He quoted Proverbs 21:20: “A foolish man devours all he has.”
Thirdly, get on a budget. This is true for the congregation as well as the church itself. He explained that organizations, like the people they serve, need an emergency fund. Make sure you, as a church business administrator, have an emergency fund set up for your church.
In addition, use cash when possible. “When you spend cash, you spend less,” he said.
Next, save and invest. He explained that personal finance is 80 percent behavioral.
And lastly, give. “Creating givers means getting people out of debt. Giving is planted in a budget, in savings,” he said. “Giving should be a natural by-product of a budget.”