FINANCE ETIQUTTE AND WISDOM
Savings and investments
By individuals are important both for personal financial well-being and for economic growth. Many governments try to encourage their citizens to save more, or to save more appropriately, by preferring formal institutions to informal saving and by promoting more diversification. However, there are considerable barriers to saving, including limited access to financial markets by some groups, complexity of financial products and information asymmetries. Knowledge and understanding of saving and investment concepts is particularly low in many countries. In addition, there are behavioural and cultural factors which may limit people’s propensity to save. As a consequence, policy makers have developed several strategies to influence whether and how individuals save. Policy responses typically involve a combination of prudential regulation and consumer protection legislation, financial incentives, financial education and awareness initiatives, as well as behavioural techniques to encourage people into sound saving decisions.
courtesy:http://www.oecd-ilibrary.org/finance-and-investment/financial-education-savings-and-investments_5k94gxrw760v-en?crawler=true
Let’s dive right into uncovering some of Ben’s timeless wisdom:
Benjamin Franklin rose from 17-year-old runaway to successful printer, newspaperman, author, inventor, diplomat, and statesman. His great success came from living the virtues of frugality and industry, and his life offers us many personal finance lessons that apply to modern men just as much as they did to those living in colonial America.
1. Understand the True Value of Things
Benjamin Franklin learned one of his first, and most important, personal finance lessons as a boy. When he was seven, he saw another boy blowing a whistle and was so charmed by its sound that he offered the boy all the money in his pockets for it. The boy eagerly agreed to the deal. Young Franklin was delighted with his new possession and blew the whistle happily all over the house. But his satisfaction was cut short when his brothers and sisters, finding out how much he had paid for it, informed him that he had forked over four times as much money as it was worth. “The reflection gave me more chagrin,” Franklin recalled, “than the whistle gave me pleasure.”
But Franklin took an invaluable lesson away from his youthful mistake:
This, however, was afterward of use to me, the impression continuing on my mind; so that often, when I was tempted to buy some unnecessary thing, I said to myself, Don’t give too much for the whistle; and I saved my money.
As I grew up, came into the world, and observed the actions of men, I thought I met with many, very many, who gave too much for the whistle.
When I saw one too ambitious of court favor, sacrificing his time in attendance on levees, his repose, his liberty, his virtue, and perhaps his friends, to attain it, I have said to myself, This man gives too much for his whistle.
When I saw another fond of popularity, constantly employing himself in political bustles, neglecting his own affairs, and ruining them by that neglect, He pays indeed, said I, too much for his whistle.
If I knew a miser, who gave up every kind of comfortable living, all the pleasure of doing good to others, all the esteem of his fellow-citizens, and the joys of benevolent friendship, for the sake of accumulating wealth, Poor man, said I, you pay too much for your whistle.
When I met with a man of pleasure, sacrificing every laudable improvement of the mind, or of his fortune, to mere corporeal sensations, and ruining his health in their pursuit, Mistaken man, said I, you are providing pain for yourself, instead of pleasure; you give too much for your whistle.
If I see one fond of appearance, or fine clothes, fine houses, fine furniture, fine equipages, all above his fortune, for which he contracts debts, and ends his career in a prison, Alas! say I, he has paid dear, very dear, for his whistle…
In short, I conceive that great part of the miseries of mankind are brought upon them by the false estimates they have made of the value of things, and by their giving too much for their whistles. -From a letter from BF to Madame Brillon, 1779
2. Be Self-Sufficient
Franklin’s father at first wanted him to go into the ministry, but then decided that the boy would follow in his own footsteps and become a candlemaker. But Franklin did not enjoy that trade, and his father, worried he’d go off to sea, took him around to observe other craftsmen at work, hoping that another trade might spark the young man’s interest. While Franklin did not become a bricklayer or carpenter, this experience did inspire the DIY spirit within him:
It has ever since been a pleasure to me to see good workmen handle their tools. And it has been often useful to me, to have learned so much by it, as to be able to do some trifling jobs in the house, when a workman was not at hand, and to construct little machines for my experiments, at the moment when the intention of making these was warm in my mind.
Franklin’s penchant for self-reliance also led him to learn how to make his own meals (using the money saved on boarding costs to buy more books), and perhaps most importantly, it helped propel his career as a printer. At the time, there was no foundry in America that made casting type, which was crucial for the printer’s trade. So instead of purchasing the equipment from England and waiting for it to arrive, Franklin initially crafted his own type–becoming the first person in America to do so—and also made his own woodcuts, printer’s ink, engraved copperplate vignettes, and plate-press.
Franklin believed that learning to be self-sufficient not only saved you money, but led to greater happiness as well:
Human felicity is produced not so much by great pieces of good fortune that seldom happen, as by little advantages that occur every day. Thus, if you teach a poor young man to shave himself, and keep his razor in order, you may contribute more to the happiness of his life than in giving him a thousand guineas. This sum may be soon spent, the regret only remaining of having foolishly consumed it; but in the other case, he escapes the frequent vexation of waiting for barbers, and of their sometimes dirty fingers, offensive breaths, and dull razors; he shaves when most convenient to him, and enjoys daily the pleasure of its being done with a good instrument. -From The Autobiography of Benjamin Franklin
3. Invest in Yourself
From my infancy I was passionately fond of reading, and all the money that came into my hands was laid out in the purchasing of books.
This library afforded me the means of improvement by constant study, for which I set apart an hour or two each day, and thus repaired in some degree the loss of the learned education my father once intended for me. Reading was the only amusement I allowed myself. I spent no time in taverns, games, or frolics of any kind; and my industry in my business continued as indefatigable as it was necessary. -From The Autobiography of Benjamin Franklin
If you want to have more time and money in the long-term, then in the short-term you need to invest some of your money, and a lot of your time, in yourself. Instead of squandering these valuable resources on fleeting pleasures, invest them in things that further your health, relationships, education, and career and will reap rich dividends down the road.
Franklin invested in himself by becoming a voracious reader; all of his spare money and time went to accumulating as much knowledge about the world as possible; by wisely managing his expenditures in these vital departments of life, Franklin created a future for himself where it was possible for a man who had only a few years of formal education to become a world-renowned writer, scientist, and diplomat.
4. Surround Yourself with Friends Who Share Your Values
When Franklin was still starting out in the printing business and living in London, he palled around with his friend, James Ralph. While Franklin worked hard at a printing house, the flighty Ralph, who had arrived in London without a dollar to his name, half-hardheartedly and unsuccessfully looked for work as an actor, clerk, and journalist, and borrowed money from Franklin to fund his unemployment.
The two friends later had a falling out, and Ralph never repaid Franklin the 27 pounds (“a great sum out of my small earnings!” Franklin recalled) that he owed him.
After this experience, Franklin was much more judicious about whom he associated with, and spent his life seeking out men and women who shared his high values and forming mutual self-improvement groups, like the Junto, where he and his friends could challenge each other’s ideas and help elevate each other’s hearts and minds.
5. Don’t Compromise Your Integrity for Money
While Benjamin Franklin had great ambitions to rise in the world, he was unwilling to compromise his integrity in order to do so. For Franklin, the key to being able to choose principles over filthy lucre was to not end up so enslaved to luxury that you become willing to do anything to maintain your lifestyle.
This is well-illustrated by Franklin’s response to a man who wished to pay to publish a piece in Franklin’s newly established newspaper, The Pennsylvania Gazette:
6. Steady Diligence Is the Way to Wealth
To apply myself industriously to whatever business I take in hand, and not divert my mind from my business by any foolish project of suddenly growing rich; for industry and patience are the surest means of plenty. – From Franklin’s “Plan for Future Conduct,” written at age 20
Franklin’s was not an overnight success story; it took him a decade to move from runaway, to apprentice in many printing shops and houses both Stateside and in London (where he did the dirty jobs for superiors who were anything but), to opening his own shop, and turning it into a profitable business. During that time he lived a spartan lifestyle and was far more industrious than any of his competitors.
Thus he encouraged others to realize their ambitions as he had, with patient, steady efforts, and he did not turn a kind eye to the various “get-rich-quick” schemes that were put forth during his day.
In one of his “Busy-Body” essays, Franklin went after those who spent their time digging for pirate treasure that had supposedly been left buried along the river, lamenting that:
Men, otherwise of very good sense, have been drawn into this practice through an overweening desire of sudden wealth and an easy credulity of what they so earnestly wished might be true; while the rational and most certain methods of acquiring riches by industry and frugality are neglected or forgotten.
Franklin cleverly concluded his essay by quoting the words his imaginary friend “Agricola” offered his son when he gave him a good plantation:
“My son,” said he, “I give thee now a valuable parcel of land; I assure thee I have found a considerable quantity of gold by digging there; thee mayest do the same; but thee must carefully observe this, never to dig more than plow-deep.”
7. Time Is Money
“What price the price of that book?” at length asked a man who had been dawdling for an hour in the front store of Benjamin Franklin’s newspaper establishment. “One dollar,” replied the clerk. “One dollar,” echoed the lounger; “can’t you take less than that?” “One dollar is the price,” was the answer.
The would-be purchaser looked over the books on sale a while longer, and then inquired: “Is Mr. Franklin in?” “Yes,” said the clerk, “he is very busy in the press-room.” “Well, I want to see him,” persisted the man. The proprietor was called, and the stranger asked: “What is the lowest, Mr. Franklin, that you can take for that book?” “One dollar and a quarter,” was the prompt rejoinder. “One dollar and a quarter! Why, your clerk asked me only a dollar just now.” “True,” said Franklin,” and I could have better afforded to take a dollar than to leave my work.”
The man seemed surprised; but, wishing to end a parley of his own seeking, he demanded: “Well, come now, tell me your lowest price for this book.” “One dollar and a half,” replied Franklin. “A dollar and a half! Why, you offered it yourself for a dollar and a quarter.” “Yes,” said Franklin coolly, “and I could better have taken that price then than a dollar and a half now.”
The man silently laid the money on the counter, took his book, and left the store, having received a salutary lesson from a master in the art of transmuting time, at will, into either wealth or wisdom. -From Pushing to the Front, 1911
Time is money. It was Franklin who first promulgated this famous phrase. These days it’s not terribly fashionable to support this maxim; to some it makes you sound like a capitalistic drudge instead of a passionate adventurer; “Time is not money! It is an opportunity to swim with the dolphins!” Yet Franklin understood that wisely using one’s time was essential to building one’s wealth, and that the more wealth you acquired, the more of your passions you would be free to pursue. By hustling his colonial butt off, Franklin was able to “retire” from the printing business at age 42, leaving the next half of his life open for doing whatever he wished.
8. The Accumulation of Money Is a Means to an End
Your sentiments of the general Foible of Mankind, in the pursuit of wealth to no end, are expressed in a manner that gave me great pleasure in reading. They are extremely just; at least they are perfectly agreeable to mine. But London citizens, they say, are ambitious of what they call dying worth a great Sum: The very notion seems to me absurd; and just the same as if a man should run in debt for 1000 Superfluities, to the End that when he should be stript of all, and imprisoned by his Creditors, it might be said he broke worth a great Sum. I imagine that what we have above what we can use is not properly ours, tho’ we possess it, and that the rich Man, who must die, was no more worth what he leaves, than the debtor who must pay.” From a letter from BF to William Strahan, 1750
While someone who is only superficially familiar with Franklin’s biography and his famous maxims might come away with the notion that he was merely a prudish, penny-pinching acquisitive capitalist who thought only of money, nothing could be further from the truth. For Franklin the pursuit of wealth was merely a means to an end. And that end was gaining the “leisure to read, study, make experiments, and converse at large with such ingenious and worthy men, as are pleased to honor me with their friendship or acquaintance, on such points as may produce something for the common benefit of mankind, uninterrupted by the little cares and fatigues of business.” Franklin’s early retirement from the printing business did indeed produce numerous benefits for mankind, including the creation of several new inventions (none of which he patented–improving the lives of others was enough reward), and his service in helping to found a new country.
For Franklin the whole point of gaining wealth and developing virtue was not to live a life of luxury (although he did enjoy more creature comforts once he was able to) nor to become a moral prude, but to allow oneself to grow into the kind of man who had the character, wisdom, and time to become an involved and upright citizen, able to serve others and one’s country, which, Franklin also believed, was the best way to serve God.
Benjamin Franklin, who wrote to his mother while he was still in his early forties, that after his death he’d rather have it said of him “he lived useful,” than “he died rich.”
Franklin’s adages in The Way to Wealth teach us that success is just the consistent application of hard work and thrift. Despite what late night infomercials claim, the principles to success haven’t changed much in 200 years. Below, I’ve collected all the maxims from The Way to Wealth in one list. Read through them, pick out a few favorites, and memorize them. They’re perfect for keeping you focused on becoming the most successful man you can be. Enjoy!
1. God helps them that help themselves
2. Sloth, like rust, consumes faster than labor wears, while the used key is always bright
3. Dost thou love life, then do not squander time, for that’s the stuff life is made of
4. The sleeping fox catches no poultry
5. There will be sleeping enough in the grave
6. Wasting time must be the greatest prodigality
7. Lost time is never found again
8. Time-enough, always proves little enough
9. Sloth makes all things difficult, but industry all easy
10. He that riseth late, must trot all day, and shall scarce overtake his business at night
11. Laziness travels so slowly, that poverty soon overtakes him
12. Drive thy business, let not that drive thee
13. Early to bed, and early to rise, makes a man healthy, wealthy and wise.
14. Industry need not wish
15. He that lives upon hope will die fasting
16. There are no gains, without pains
17. He that hath a trade hath an estate
18. He that hath a calling hath an office of profit and honor
19. At the working man’s house hunger looks in, but dares not enter
20. For industry pays debts, while despair encreaseth them
21. Diligence is the mother of good luck
22. Plough deep, while sluggards sleep, and you shall have corn to sell and to keep
23. One today is worth two tomorrows
24. Have you somewhat to do tomorrow, do it today
25. Be ashamed to catch yourself idle
26. Let not the sun look down and say, inglorious here he lies
27. The cat in gloves catches no mice
28. Constant dropping wears away stones
29. Diligence and patience the mouse ate in two the cable
30. Little strokes fell great oaks
31. Employ thy time well if thou meanest to gain leisure
32. Since thou art not sure of a minute, throw not away an hour
33. A life of leisure and a life of laziness are two things
34. Trouble springs from idleness, and grievous toil from needless ease
35. Many without labor would live by their wits only, but they break for want of stock
36. Industry gives comfort, and plenty, and respect: fly pleasures, and they’ll follow you
37. Keep the shop, and thy shop will keep thee
38. If you would have your business done, go; if not, send
39. The eye of a master will do more work than both his hands
40. Want of care does us more damage than want of knowledge
41. Not to oversee workmen is to leave them your purse open
42. In the affairs of this world men are saved not by faith, but by the want of it
43. Learning is to the studious, and riches to the careful
44. He that by the plough would thrive, Himself must either hold or drive.
45. If you would have a faithful servant, and one that you like, serve yourself
46. A little neglect may breed great mischief
47. For want of a nail the shoe was lost; for want of a shoe the horse was lost, and for want of a horse the rider was lost
48. A man may, if he knows not how to save as he gets,keep his nose all his life to the grindstone, and die not worth a groat at last
49. If you would be wealthy, think of saving as well as of getting
50. What maintains one vice, would bring up two children
51. Beware of little expenses; a small leak will sink a great ship
52. Who dainties love, shall beggars prove
53. Fools make Feasts, and wise men eat them
54. Buy what thou hast no need of, and ere long thou shalt sell thy necessaries
55. At a great pennyworth pause a while: he means, that perhaps the cheapness is apparent only, and not real
56. Many have been ruined by buying good pennyworths
57. ‘Tis foolish to lay our money in a purchase of repentance
58. Wise men learn by others’ harms, fools scarcely by their own
59. Silks and satins, scarlet and velvets put out the kitchen fire
60. A ploughman on his legs is higher than a gentleman on his knees
61. Always taking out of the meal-tub, and never putting in, soon comes to the bottom
62. When the well’s dry, they know the worth of water
63. If you would know the value of money, go and try to borrow some
64. He that goes a borrowing goes a sorrowing
65. Pride is as loud a beggar as want, and a great deal more saucy
66. ‘Tis easier to suppress the first desire than to satisfy all that follow
67. Pride that dines on vanity sups on contempt
68. Pride breakfasted with plenty, dined with poverty, and supped with infam
69. The second vice is lying, the first is running in debt
70. But what madness must it be to run in debt for these superfluities!
71. When you run in debt; you give to another power over your liberty
72. Lying rides upon debt’s back
73. ‘Tis hard for an empty bag to stand upright
74. Creditors have better memories than debtors
75. The borrower is a slave to the lender, and the debtor to the creditor
76. Disdain the chain, preserve your freedom; and maintain your independency: be industrious and free; be frugal and free.
77. Poverty often deprives a man of all spirit and virtue: ’tis hard for an empty bag to stand upright
78. Creditors are a superstitious sect, great observers of set days and times
79. Those have a short Lent who owe money to be paid at Easter
80. The borrower is a slave to the lender, and the debtor to the creditor
81. For age and want, save while you may; No morning sun lasts a whole day
82. Gain may be temporary and uncertain, but ever while you live, expense is constant and certain
83. Tis easier to build two chimneys than to keep one in fuel
84. Rather go to bed supperless than rise in debt.
85. Get what you can, and what you get hold; ’Tis the stone that will turn all your lead into gold
courtesy:http://www.artofmanliness.com/2009/07/27/money-and-career-advice-from-benjamin-franklins-way-to-wealth/
Cultural views on expenditures, saving and investment
Population Growth, Savings, and Investment: A Broader Framework .Because the impact of age on savings can be positive, negative, or negligible, the relationship can be identified only by an appeal to data. Studies that have attempted to identify this empirical relationship have for the most part used international cross-section data where savings rates are explained by dependency rates (young dependents, old de- pendents), per capita income, and income growth (to distinguish per- manent from transitory income). Because of data problems and
econometric controversy, the findings of these studies are as inconclu- sive as the theory under test. The results are sensitive to the sample drawn, the definition of saving, functional form, the stage of develop- ment, and the extent of the postulated feedbacks. The most common finding is a small or negligible impact of young dependents; where a negative dependency effect does emerge, it almost invariably shows up for old dependents as well. What is clear is that, if a negative depen- dency effect exists, it is not quantitatively strong, nor is it pervasive or
robust with respect to the various data sets and model specifications.24
While empirical research has focused on econometrics, an equally or more relevant issue lies in the conceptualization of the problem and the formulation of the appropriate hypothesis under test. In particular, the objective of these studies is to identify the impact of dependency on
economic growth through the impact on investment and accumulation (saving). However, a narrow definition of saving is employed that, for the most part, excludes investments in human capital. An interesting issue thus arises as to the impact of dependency on saving where the
latter is more broadly measured to include, for example, expenditures on education.25 It is plausible that an increase in the proportion of young dependents would decrease financial savings but increase sav- ings (via investments) in the form of education, and thus the impact of 456 Economic Development and Cultural Change dependency may be less to change the level of accumulation and more to alter its composition. Indeed, the increase in human capital accumu- lation may be facilitated by the reduction in financial saving. The net impact on growth of this transfer of resources depends in part on the relative productivity of human, rather than physical, capital formation. I have undertaken an exploratory empirical analysis of this issue
by comparing estimates of financial with "total" savings (including expenditures on public education) by estimating dependency-rate re- gressions using variables commonly employed in the literature.26 In addition to the reconceptualization of the problem, my empirical re- sults include several other features: they employ more recent and com- plete data (for 1980); they use a linear functional form and (where appropriate) correct for heteroscedasticity;27 and they examine the im- pact of urbanization, not only to identify its effect directly (i.e., the possibility of higher savings rates due to more developed capital mar- kets in urban centers), but also to (imperfectly) control for the impact of location on the measurement of saving (i.e., distinguish between financial savings in the city vs. saving in kind on the farm). Because my objective is to examine the relationships of age depen- dency on savings when educational investments are taken into ac- count, I have drawn the sample of countries to correspond to that
employed by T. Paul Schultz in a recent study showing the relationship of population growth to intercountry expenditures on education.28 Having sample comparability adds validity to a comparison of my results with his, yielding greater insight and understanding of both
studies.
courtesy:http://dukespace.lib.duke.edu/dspace/bitstream/handle/10161/2536/kelley_population_pressures_and.pdf?sequence=1
Savings and investments by individuals are important both for personal financial well-being and for economic growth. Many governments try to encourage their citizens to save more, or to save more appropriately, by preferring formal institutions to informal saving and by promoting more diversification. However, there are considerable barriers to saving, including limited access to financial markets by some groups, complexity of financial products and information asymmetries. Knowledge and understanding of saving and investment concepts is particularly low in many countries. In addition, there are behavioural and cultural factors which may limit people’s propensity to save. As a consequence, policy makers have developed several strategies to influence whether and how individuals save. Policy responses typically involve a combination of prudential regulation and consumer protection legislation, financial incentives, financial education and awareness initiatives, as well as behavioural techniques to encourage people into sound saving decisions.
courtesy:http://www.oecd-ilibrary.org/finance-and-investment/financial-education-savings-and-investments_5k94gxrw760v-en?crawler=true
Family role in teaching financial literacy
Financial literacy is the ability to use knowledge and skills to make effective and informed money management decisions. Personal financial literacy encompasses a range of money topics, from everyday skills such as balancing a checkbook to long-term planning for retirement. While literacy - the ability to read and write - is a fundamental part of the education system, financial literacy is often left out of the equation. In the United States, fewer than half of states have any financial literacy requirements for their K-12 education systems, and only four states require high school students to take personal finance classes.
While there is a movement to include more finance-related coursework in elementary, middle and high school settings, parents and guardians are the primary educators when it comes to teaching children the skills they need to develop a strong foundation for life-long financial competence. Many adults, however, avoid talking to kids about money, because they lack confidence in how they've handled their own finances. This is unfortunate, because adults have two things that children do not when it comes to finances: experience and perspective. You do not have to be a financial rock star with a perfect track record to teach your child personal finance basics and get the money conversation started. If your finances are currently in a mess, you can work to get them in order and be a positive role model.
Like other provocative topics, money is something that kids will hear about outside the home - at school, summer camp, sports practice and at friends' houses. While this may sound harmless (what could they possibly hear that could be that bad?), kids can get the wrong message about money by getting information from their peers. For example, your child might hear a classmate say that rich people are lucky. If your child believes that wealth is a result of luck, what motivation will he or she have to handle money responsibly? It's important to clarify at a young age that most wealth is not a result of luck - that most people work hard and make smart decisions to "get rich." Even if you don't know the difference between defined benefit and defined contribution pension plans, you can provide accurate information, introduce ideas, spark interest and awareness, and help empower your children to take control of their financial lives.
By teaching your children about money, you help them discover the relationships between earning, spending and saving. In doing this, children also begin to understand the value of money. This financial literacy can begin at a young age with simple money concepts such as counting coins and making change for purchases. Older children can learn about savings accounts, balancing a check book and creating a personal budget. The key is to teach a concept and let them try, even if it means a little extra time in the toy store while your little one painstakingly counts out coins from his or her piggy bank.
courtesy:http://www.investopedia.com/university/teaching-financial-literacy-kids/
TITHES AND OFFERING PRINCIPLES
Much of what is said about tithing these days is usually in the negative. That is, people often say why they don’t tithe or why they think tithing is not for the New Testament. That, of course, is not enough. I have on many occasions asked those who don’t believe in tithing what they do believe and the answers are not always very clear.
The truth is, even if you think tithing is not for today you cannot deny the responsibility to give, and if we are to give, then we should be able to articulate well the principles and the practice of giving.
It isn’t enough to say you don’t believe in tithing. If you believe tithing is over then you must say what has taken its place. I do believe in tithing and this and other posts give the reasons why. Hopefully, the posts in this series will inform those who do not understand and answer those who would say otherwise.
More Than A Doctrine We don’t teach just a doctrine we teach a philosophy. A “doctrine” gives form to your religious experience but it doesn’t give meaning or significance.
Many Christians and even many churches have ceremonies they follow in their religious expressions but these are nothing but empty traditions until someone sheds light on the purpose they serve and the context in which they started. Traditions aren’t bad because they are traditions but there must be sound philosophies motivating them. We do things for a reason and are driven by philosophies.
We practice the tradition best when we understand the philosophy. Sometimes, however, we challenge tradition because we don’t understand the philosophy. At other times traditions are changed because we do.
It is traditional, for example, for congregations to buy land and build buildings in which they conduct worship services, organize educational programs, offer counselling, arrange social events and so on. This tradition is being challenged today. The primacy of these activities is being questioned. This model is being decried because many useful purposes are not being served. People are becoming disenchanted with the church and leaving it behind.
One spin off to this trend is to question tithing. All the things people don’t like about church are funded by tithes. The thinking is, if the thing being funded is questionable then the funding method must also be dubious and what naturally follows is not very healthy. Everything is eventually questioned.
In this situation, with regard to tithing, many people simply humanize their giving. Whatever philosophies they have about giving for any humanitarian purpose bleeds through when they develop a plan for giving to God. That is, they give to God the same way they give to any other human cause. That may be acceptable on a human level but it may not represent biblical teaching.
And remember that everyone has a philosophy. No one approaches the Bible or God philosophically neutral. We are all philosophically driven even if we cannot explain clearly the philosophies we own. You cannot clearly substantiate any teaching of Scripture without giving philosophical dimensions to it and human philosophies will naturally take over unless reformatted by biblical influence.
Tithing, and the principles behind it, is more than just a doctrine we teach pragmatically or a new feature we add to conventional methods of financial management. It is driven by philosophies that are spiritually founded and is the primary evidence that your relationship to God is more than just casual. You could say that tithing represents the opposing opinion when it comes to human methods of managing finances. It makes a spiritual statement. It reflects an attitude of commitment toward God and His work.
And what is the first thing I would say about tithing philosophically? It is a matter of trust! Not can God be trusted but can we be trusted, to tithe? Can we be trusted to give a set proportion of our income to God every time it comes our way? That is tithing and that is truly a test of one’s trustworthiness. The truth is, a person who cannot be trusted to tithe cannot be trusted by God.
These are very strong statements but tithing represents a spiritual principle and overrides all other approaches to managing our financial resources. If we understand the philosophy then we have no problem with the practice. Even if a person disagrees with the practice they are still responsible for the philosophy. If tithing is not evidence that a person can be trusted by God, what is? What is your philosophy?
So far, in preceding posts, I have explained why Jesus didn’t re-teach tithing and discussed the long history of this practice in Scripture. In future posts I will give reasons to show that tithing is practically and philosophically the rational thing to do.
courtesy:http://www.modeloff.comhttp://nowthinkaboutit.com/2009/07/the-philosophy-of-tithing/
"We make a living by what we get, but we make a life by what we give."
Save, spend and give—my big three principles. Most people forget about the giving part because they think I only scream "Save, save, save!"
Giving liberates the soul of the giver. You never walk away feeling badly. Whether through a tithe, charitable contribution, or gift to a friend in need, give away at least some of your money. Not only does it generate good, but it generates contentment.
Remember, no one has ever become poor by giving.
Is it acceptable to pause tithing in tough financial times?
The Bible does not mention anything about "pausing" tithing. Neither does it say that we will go to Hell if we do not tithe.
The tithe, which is a scriptural mandate, was not instituted for God's benefit because He already has all the money He needs. He does not need our money.
So why does He ask us to give 10% to Him? Tithing was created for our benefit. It is to teach us how to keep God first in our lives and how to be unselfish people. Unselfish people make better husbands, wives, friends, relatives, employees and employers. God is trying to teach us how to prosper over time.
Many people have observed that after they stopped tithing, their finances seemed to get worse. In the Book of Malachi, God promises that if you do not rob Him of your tithing, He will rebuke your devourers and protect you.
If you cannot live off 90% of your income, then you cannot live off 100%. It does not require a miracle for you to get through the month. I think that if you sit down and look at your budget, you will see that you can make it while giving at least 10%. Read the Bible and take from it what you will, and if you tithe, do it out of love for God, not guilt.
I do not beat people up for not tithing because Jesus certainly did not, but let me encourage you to keep tithing.
Is it right to count my church tithes on my tax returns?
You gave the money to the church. You were biblically obedient in that. The Bible also tells us to be good managers of our money. It does not diminish the sanctity of your gift to take the tax deduction. It is a way to manage the rest of the money. Take the deduction.
Later when you get your income tax refund, remember that this is money that you've already tithed, although you're certainly welcome to devote some or all of it back to the Lord as additional thanks for His blessings.
I'm making more money now. How should I increase my giving above the tithe?
When things are going well, it's easy to accidentally spend all the extra income, so I would recommend that you budget what to do with it.
For example, Sharon and I set up a budget based on my salary. This budget includes giving, spending, and saving—just as I advise others to do. Then, everything else we make is divided among extra giving, extra investing, and some blow money.
Savings and investments
By individuals are important both for personal financial well-being and for economic growth. Many governments try to encourage their citizens to save more, or to save more appropriately, by preferring formal institutions to informal saving and by promoting more diversification. However, there are considerable barriers to saving, including limited access to financial markets by some groups, complexity of financial products and information asymmetries. Knowledge and understanding of saving and investment concepts is particularly low in many countries. In addition, there are behavioural and cultural factors which may limit people’s propensity to save. As a consequence, policy makers have developed several strategies to influence whether and how individuals save. Policy responses typically involve a combination of prudential regulation and consumer protection legislation, financial incentives, financial education and awareness initiatives, as well as behavioural techniques to encourage people into sound saving decisions.
courtesy:http://www.oecd-ilibrary.org/finance-and-investment/financial-education-savings-and-investments_5k94gxrw760v-en?crawler=true
Let’s dive right into uncovering some of Ben’s timeless wisdom:
Benjamin Franklin rose from 17-year-old runaway to successful printer, newspaperman, author, inventor, diplomat, and statesman. His great success came from living the virtues of frugality and industry, and his life offers us many personal finance lessons that apply to modern men just as much as they did to those living in colonial America.
1. Understand the True Value of Things
Benjamin Franklin learned one of his first, and most important, personal finance lessons as a boy. When he was seven, he saw another boy blowing a whistle and was so charmed by its sound that he offered the boy all the money in his pockets for it. The boy eagerly agreed to the deal. Young Franklin was delighted with his new possession and blew the whistle happily all over the house. But his satisfaction was cut short when his brothers and sisters, finding out how much he had paid for it, informed him that he had forked over four times as much money as it was worth. “The reflection gave me more chagrin,” Franklin recalled, “than the whistle gave me pleasure.”
But Franklin took an invaluable lesson away from his youthful mistake:
This, however, was afterward of use to me, the impression continuing on my mind; so that often, when I was tempted to buy some unnecessary thing, I said to myself, Don’t give too much for the whistle; and I saved my money.
As I grew up, came into the world, and observed the actions of men, I thought I met with many, very many, who gave too much for the whistle.
When I saw one too ambitious of court favor, sacrificing his time in attendance on levees, his repose, his liberty, his virtue, and perhaps his friends, to attain it, I have said to myself, This man gives too much for his whistle.
When I saw another fond of popularity, constantly employing himself in political bustles, neglecting his own affairs, and ruining them by that neglect, He pays indeed, said I, too much for his whistle.
If I knew a miser, who gave up every kind of comfortable living, all the pleasure of doing good to others, all the esteem of his fellow-citizens, and the joys of benevolent friendship, for the sake of accumulating wealth, Poor man, said I, you pay too much for your whistle.
When I met with a man of pleasure, sacrificing every laudable improvement of the mind, or of his fortune, to mere corporeal sensations, and ruining his health in their pursuit, Mistaken man, said I, you are providing pain for yourself, instead of pleasure; you give too much for your whistle.
If I see one fond of appearance, or fine clothes, fine houses, fine furniture, fine equipages, all above his fortune, for which he contracts debts, and ends his career in a prison, Alas! say I, he has paid dear, very dear, for his whistle…
In short, I conceive that great part of the miseries of mankind are brought upon them by the false estimates they have made of the value of things, and by their giving too much for their whistles. -From a letter from BF to Madame Brillon, 1779
2. Be Self-Sufficient
Franklin’s father at first wanted him to go into the ministry, but then decided that the boy would follow in his own footsteps and become a candlemaker. But Franklin did not enjoy that trade, and his father, worried he’d go off to sea, took him around to observe other craftsmen at work, hoping that another trade might spark the young man’s interest. While Franklin did not become a bricklayer or carpenter, this experience did inspire the DIY spirit within him:
It has ever since been a pleasure to me to see good workmen handle their tools. And it has been often useful to me, to have learned so much by it, as to be able to do some trifling jobs in the house, when a workman was not at hand, and to construct little machines for my experiments, at the moment when the intention of making these was warm in my mind.
Franklin’s penchant for self-reliance also led him to learn how to make his own meals (using the money saved on boarding costs to buy more books), and perhaps most importantly, it helped propel his career as a printer. At the time, there was no foundry in America that made casting type, which was crucial for the printer’s trade. So instead of purchasing the equipment from England and waiting for it to arrive, Franklin initially crafted his own type–becoming the first person in America to do so—and also made his own woodcuts, printer’s ink, engraved copperplate vignettes, and plate-press.
Franklin believed that learning to be self-sufficient not only saved you money, but led to greater happiness as well:
Human felicity is produced not so much by great pieces of good fortune that seldom happen, as by little advantages that occur every day. Thus, if you teach a poor young man to shave himself, and keep his razor in order, you may contribute more to the happiness of his life than in giving him a thousand guineas. This sum may be soon spent, the regret only remaining of having foolishly consumed it; but in the other case, he escapes the frequent vexation of waiting for barbers, and of their sometimes dirty fingers, offensive breaths, and dull razors; he shaves when most convenient to him, and enjoys daily the pleasure of its being done with a good instrument. -From The Autobiography of Benjamin Franklin
3. Invest in Yourself
From my infancy I was passionately fond of reading, and all the money that came into my hands was laid out in the purchasing of books.
This library afforded me the means of improvement by constant study, for which I set apart an hour or two each day, and thus repaired in some degree the loss of the learned education my father once intended for me. Reading was the only amusement I allowed myself. I spent no time in taverns, games, or frolics of any kind; and my industry in my business continued as indefatigable as it was necessary. -From The Autobiography of Benjamin Franklin
If you want to have more time and money in the long-term, then in the short-term you need to invest some of your money, and a lot of your time, in yourself. Instead of squandering these valuable resources on fleeting pleasures, invest them in things that further your health, relationships, education, and career and will reap rich dividends down the road.
Franklin invested in himself by becoming a voracious reader; all of his spare money and time went to accumulating as much knowledge about the world as possible; by wisely managing his expenditures in these vital departments of life, Franklin created a future for himself where it was possible for a man who had only a few years of formal education to become a world-renowned writer, scientist, and diplomat.
4. Surround Yourself with Friends Who Share Your Values
When Franklin was still starting out in the printing business and living in London, he palled around with his friend, James Ralph. While Franklin worked hard at a printing house, the flighty Ralph, who had arrived in London without a dollar to his name, half-hardheartedly and unsuccessfully looked for work as an actor, clerk, and journalist, and borrowed money from Franklin to fund his unemployment.
The two friends later had a falling out, and Ralph never repaid Franklin the 27 pounds (“a great sum out of my small earnings!” Franklin recalled) that he owed him.
After this experience, Franklin was much more judicious about whom he associated with, and spent his life seeking out men and women who shared his high values and forming mutual self-improvement groups, like the Junto, where he and his friends could challenge each other’s ideas and help elevate each other’s hearts and minds.
5. Don’t Compromise Your Integrity for Money
While Benjamin Franklin had great ambitions to rise in the world, he was unwilling to compromise his integrity in order to do so. For Franklin, the key to being able to choose principles over filthy lucre was to not end up so enslaved to luxury that you become willing to do anything to maintain your lifestyle.
This is well-illustrated by Franklin’s response to a man who wished to pay to publish a piece in Franklin’s newly established newspaper, The Pennsylvania Gazette:
6. Steady Diligence Is the Way to Wealth
To apply myself industriously to whatever business I take in hand, and not divert my mind from my business by any foolish project of suddenly growing rich; for industry and patience are the surest means of plenty. – From Franklin’s “Plan for Future Conduct,” written at age 20
Franklin’s was not an overnight success story; it took him a decade to move from runaway, to apprentice in many printing shops and houses both Stateside and in London (where he did the dirty jobs for superiors who were anything but), to opening his own shop, and turning it into a profitable business. During that time he lived a spartan lifestyle and was far more industrious than any of his competitors.
Thus he encouraged others to realize their ambitions as he had, with patient, steady efforts, and he did not turn a kind eye to the various “get-rich-quick” schemes that were put forth during his day.
In one of his “Busy-Body” essays, Franklin went after those who spent their time digging for pirate treasure that had supposedly been left buried along the river, lamenting that:
Men, otherwise of very good sense, have been drawn into this practice through an overweening desire of sudden wealth and an easy credulity of what they so earnestly wished might be true; while the rational and most certain methods of acquiring riches by industry and frugality are neglected or forgotten.
Franklin cleverly concluded his essay by quoting the words his imaginary friend “Agricola” offered his son when he gave him a good plantation:
“My son,” said he, “I give thee now a valuable parcel of land; I assure thee I have found a considerable quantity of gold by digging there; thee mayest do the same; but thee must carefully observe this, never to dig more than plow-deep.”
7. Time Is Money
“What price the price of that book?” at length asked a man who had been dawdling for an hour in the front store of Benjamin Franklin’s newspaper establishment. “One dollar,” replied the clerk. “One dollar,” echoed the lounger; “can’t you take less than that?” “One dollar is the price,” was the answer.
The would-be purchaser looked over the books on sale a while longer, and then inquired: “Is Mr. Franklin in?” “Yes,” said the clerk, “he is very busy in the press-room.” “Well, I want to see him,” persisted the man. The proprietor was called, and the stranger asked: “What is the lowest, Mr. Franklin, that you can take for that book?” “One dollar and a quarter,” was the prompt rejoinder. “One dollar and a quarter! Why, your clerk asked me only a dollar just now.” “True,” said Franklin,” and I could have better afforded to take a dollar than to leave my work.”
The man seemed surprised; but, wishing to end a parley of his own seeking, he demanded: “Well, come now, tell me your lowest price for this book.” “One dollar and a half,” replied Franklin. “A dollar and a half! Why, you offered it yourself for a dollar and a quarter.” “Yes,” said Franklin coolly, “and I could better have taken that price then than a dollar and a half now.”
The man silently laid the money on the counter, took his book, and left the store, having received a salutary lesson from a master in the art of transmuting time, at will, into either wealth or wisdom. -From Pushing to the Front, 1911
Time is money. It was Franklin who first promulgated this famous phrase. These days it’s not terribly fashionable to support this maxim; to some it makes you sound like a capitalistic drudge instead of a passionate adventurer; “Time is not money! It is an opportunity to swim with the dolphins!” Yet Franklin understood that wisely using one’s time was essential to building one’s wealth, and that the more wealth you acquired, the more of your passions you would be free to pursue. By hustling his colonial butt off, Franklin was able to “retire” from the printing business at age 42, leaving the next half of his life open for doing whatever he wished.
8. The Accumulation of Money Is a Means to an End
Your sentiments of the general Foible of Mankind, in the pursuit of wealth to no end, are expressed in a manner that gave me great pleasure in reading. They are extremely just; at least they are perfectly agreeable to mine. But London citizens, they say, are ambitious of what they call dying worth a great Sum: The very notion seems to me absurd; and just the same as if a man should run in debt for 1000 Superfluities, to the End that when he should be stript of all, and imprisoned by his Creditors, it might be said he broke worth a great Sum. I imagine that what we have above what we can use is not properly ours, tho’ we possess it, and that the rich Man, who must die, was no more worth what he leaves, than the debtor who must pay.” From a letter from BF to William Strahan, 1750
While someone who is only superficially familiar with Franklin’s biography and his famous maxims might come away with the notion that he was merely a prudish, penny-pinching acquisitive capitalist who thought only of money, nothing could be further from the truth. For Franklin the pursuit of wealth was merely a means to an end. And that end was gaining the “leisure to read, study, make experiments, and converse at large with such ingenious and worthy men, as are pleased to honor me with their friendship or acquaintance, on such points as may produce something for the common benefit of mankind, uninterrupted by the little cares and fatigues of business.” Franklin’s early retirement from the printing business did indeed produce numerous benefits for mankind, including the creation of several new inventions (none of which he patented–improving the lives of others was enough reward), and his service in helping to found a new country.
For Franklin the whole point of gaining wealth and developing virtue was not to live a life of luxury (although he did enjoy more creature comforts once he was able to) nor to become a moral prude, but to allow oneself to grow into the kind of man who had the character, wisdom, and time to become an involved and upright citizen, able to serve others and one’s country, which, Franklin also believed, was the best way to serve God.
Benjamin Franklin, who wrote to his mother while he was still in his early forties, that after his death he’d rather have it said of him “he lived useful,” than “he died rich.”
Franklin’s adages in The Way to Wealth teach us that success is just the consistent application of hard work and thrift. Despite what late night infomercials claim, the principles to success haven’t changed much in 200 years. Below, I’ve collected all the maxims from The Way to Wealth in one list. Read through them, pick out a few favorites, and memorize them. They’re perfect for keeping you focused on becoming the most successful man you can be. Enjoy!
1. God helps them that help themselves
2. Sloth, like rust, consumes faster than labor wears, while the used key is always bright
3. Dost thou love life, then do not squander time, for that’s the stuff life is made of
4. The sleeping fox catches no poultry
5. There will be sleeping enough in the grave
6. Wasting time must be the greatest prodigality
7. Lost time is never found again
8. Time-enough, always proves little enough
9. Sloth makes all things difficult, but industry all easy
10. He that riseth late, must trot all day, and shall scarce overtake his business at night
11. Laziness travels so slowly, that poverty soon overtakes him
12. Drive thy business, let not that drive thee
13. Early to bed, and early to rise, makes a man healthy, wealthy and wise.
14. Industry need not wish
15. He that lives upon hope will die fasting
16. There are no gains, without pains
17. He that hath a trade hath an estate
18. He that hath a calling hath an office of profit and honor
19. At the working man’s house hunger looks in, but dares not enter
20. For industry pays debts, while despair encreaseth them
21. Diligence is the mother of good luck
22. Plough deep, while sluggards sleep, and you shall have corn to sell and to keep
23. One today is worth two tomorrows
24. Have you somewhat to do tomorrow, do it today
25. Be ashamed to catch yourself idle
26. Let not the sun look down and say, inglorious here he lies
27. The cat in gloves catches no mice
28. Constant dropping wears away stones
29. Diligence and patience the mouse ate in two the cable
30. Little strokes fell great oaks
31. Employ thy time well if thou meanest to gain leisure
32. Since thou art not sure of a minute, throw not away an hour
33. A life of leisure and a life of laziness are two things
34. Trouble springs from idleness, and grievous toil from needless ease
35. Many without labor would live by their wits only, but they break for want of stock
36. Industry gives comfort, and plenty, and respect: fly pleasures, and they’ll follow you
37. Keep the shop, and thy shop will keep thee
38. If you would have your business done, go; if not, send
39. The eye of a master will do more work than both his hands
40. Want of care does us more damage than want of knowledge
41. Not to oversee workmen is to leave them your purse open
42. In the affairs of this world men are saved not by faith, but by the want of it
43. Learning is to the studious, and riches to the careful
44. He that by the plough would thrive, Himself must either hold or drive.
45. If you would have a faithful servant, and one that you like, serve yourself
46. A little neglect may breed great mischief
47. For want of a nail the shoe was lost; for want of a shoe the horse was lost, and for want of a horse the rider was lost
48. A man may, if he knows not how to save as he gets,keep his nose all his life to the grindstone, and die not worth a groat at last
49. If you would be wealthy, think of saving as well as of getting
50. What maintains one vice, would bring up two children
51. Beware of little expenses; a small leak will sink a great ship
52. Who dainties love, shall beggars prove
53. Fools make Feasts, and wise men eat them
54. Buy what thou hast no need of, and ere long thou shalt sell thy necessaries
55. At a great pennyworth pause a while: he means, that perhaps the cheapness is apparent only, and not real
56. Many have been ruined by buying good pennyworths
57. ‘Tis foolish to lay our money in a purchase of repentance
58. Wise men learn by others’ harms, fools scarcely by their own
59. Silks and satins, scarlet and velvets put out the kitchen fire
60. A ploughman on his legs is higher than a gentleman on his knees
61. Always taking out of the meal-tub, and never putting in, soon comes to the bottom
62. When the well’s dry, they know the worth of water
63. If you would know the value of money, go and try to borrow some
64. He that goes a borrowing goes a sorrowing
65. Pride is as loud a beggar as want, and a great deal more saucy
66. ‘Tis easier to suppress the first desire than to satisfy all that follow
67. Pride that dines on vanity sups on contempt
68. Pride breakfasted with plenty, dined with poverty, and supped with infam
69. The second vice is lying, the first is running in debt
70. But what madness must it be to run in debt for these superfluities!
71. When you run in debt; you give to another power over your liberty
72. Lying rides upon debt’s back
73. ‘Tis hard for an empty bag to stand upright
74. Creditors have better memories than debtors
75. The borrower is a slave to the lender, and the debtor to the creditor
76. Disdain the chain, preserve your freedom; and maintain your independency: be industrious and free; be frugal and free.
77. Poverty often deprives a man of all spirit and virtue: ’tis hard for an empty bag to stand upright
78. Creditors are a superstitious sect, great observers of set days and times
79. Those have a short Lent who owe money to be paid at Easter
80. The borrower is a slave to the lender, and the debtor to the creditor
81. For age and want, save while you may; No morning sun lasts a whole day
82. Gain may be temporary and uncertain, but ever while you live, expense is constant and certain
83. Tis easier to build two chimneys than to keep one in fuel
84. Rather go to bed supperless than rise in debt.
85. Get what you can, and what you get hold; ’Tis the stone that will turn all your lead into gold
courtesy:http://www.artofmanliness.com/2009/07/27/money-and-career-advice-from-benjamin-franklins-way-to-wealth/
Cultural views on expenditures, saving and investment
Population Growth, Savings, and Investment: A Broader Framework .Because the impact of age on savings can be positive, negative, or negligible, the relationship can be identified only by an appeal to data. Studies that have attempted to identify this empirical relationship have for the most part used international cross-section data where savings rates are explained by dependency rates (young dependents, old de- pendents), per capita income, and income growth (to distinguish per- manent from transitory income). Because of data problems and
econometric controversy, the findings of these studies are as inconclu- sive as the theory under test. The results are sensitive to the sample drawn, the definition of saving, functional form, the stage of develop- ment, and the extent of the postulated feedbacks. The most common finding is a small or negligible impact of young dependents; where a negative dependency effect does emerge, it almost invariably shows up for old dependents as well. What is clear is that, if a negative depen- dency effect exists, it is not quantitatively strong, nor is it pervasive or
robust with respect to the various data sets and model specifications.24
While empirical research has focused on econometrics, an equally or more relevant issue lies in the conceptualization of the problem and the formulation of the appropriate hypothesis under test. In particular, the objective of these studies is to identify the impact of dependency on
economic growth through the impact on investment and accumulation (saving). However, a narrow definition of saving is employed that, for the most part, excludes investments in human capital. An interesting issue thus arises as to the impact of dependency on saving where the
latter is more broadly measured to include, for example, expenditures on education.25 It is plausible that an increase in the proportion of young dependents would decrease financial savings but increase sav- ings (via investments) in the form of education, and thus the impact of 456 Economic Development and Cultural Change dependency may be less to change the level of accumulation and more to alter its composition. Indeed, the increase in human capital accumu- lation may be facilitated by the reduction in financial saving. The net impact on growth of this transfer of resources depends in part on the relative productivity of human, rather than physical, capital formation. I have undertaken an exploratory empirical analysis of this issue
by comparing estimates of financial with "total" savings (including expenditures on public education) by estimating dependency-rate re- gressions using variables commonly employed in the literature.26 In addition to the reconceptualization of the problem, my empirical re- sults include several other features: they employ more recent and com- plete data (for 1980); they use a linear functional form and (where appropriate) correct for heteroscedasticity;27 and they examine the im- pact of urbanization, not only to identify its effect directly (i.e., the possibility of higher savings rates due to more developed capital mar- kets in urban centers), but also to (imperfectly) control for the impact of location on the measurement of saving (i.e., distinguish between financial savings in the city vs. saving in kind on the farm). Because my objective is to examine the relationships of age depen- dency on savings when educational investments are taken into ac- count, I have drawn the sample of countries to correspond to that
employed by T. Paul Schultz in a recent study showing the relationship of population growth to intercountry expenditures on education.28 Having sample comparability adds validity to a comparison of my results with his, yielding greater insight and understanding of both
studies.
courtesy:http://dukespace.lib.duke.edu/dspace/bitstream/handle/10161/2536/kelley_population_pressures_and.pdf?sequence=1
Savings and investments by individuals are important both for personal financial well-being and for economic growth. Many governments try to encourage their citizens to save more, or to save more appropriately, by preferring formal institutions to informal saving and by promoting more diversification. However, there are considerable barriers to saving, including limited access to financial markets by some groups, complexity of financial products and information asymmetries. Knowledge and understanding of saving and investment concepts is particularly low in many countries. In addition, there are behavioural and cultural factors which may limit people’s propensity to save. As a consequence, policy makers have developed several strategies to influence whether and how individuals save. Policy responses typically involve a combination of prudential regulation and consumer protection legislation, financial incentives, financial education and awareness initiatives, as well as behavioural techniques to encourage people into sound saving decisions.
courtesy:http://www.oecd-ilibrary.org/finance-and-investment/financial-education-savings-and-investments_5k94gxrw760v-en?crawler=true
Family role in teaching financial literacy
Financial literacy is the ability to use knowledge and skills to make effective and informed money management decisions. Personal financial literacy encompasses a range of money topics, from everyday skills such as balancing a checkbook to long-term planning for retirement. While literacy - the ability to read and write - is a fundamental part of the education system, financial literacy is often left out of the equation. In the United States, fewer than half of states have any financial literacy requirements for their K-12 education systems, and only four states require high school students to take personal finance classes.
While there is a movement to include more finance-related coursework in elementary, middle and high school settings, parents and guardians are the primary educators when it comes to teaching children the skills they need to develop a strong foundation for life-long financial competence. Many adults, however, avoid talking to kids about money, because they lack confidence in how they've handled their own finances. This is unfortunate, because adults have two things that children do not when it comes to finances: experience and perspective. You do not have to be a financial rock star with a perfect track record to teach your child personal finance basics and get the money conversation started. If your finances are currently in a mess, you can work to get them in order and be a positive role model.
Like other provocative topics, money is something that kids will hear about outside the home - at school, summer camp, sports practice and at friends' houses. While this may sound harmless (what could they possibly hear that could be that bad?), kids can get the wrong message about money by getting information from their peers. For example, your child might hear a classmate say that rich people are lucky. If your child believes that wealth is a result of luck, what motivation will he or she have to handle money responsibly? It's important to clarify at a young age that most wealth is not a result of luck - that most people work hard and make smart decisions to "get rich." Even if you don't know the difference between defined benefit and defined contribution pension plans, you can provide accurate information, introduce ideas, spark interest and awareness, and help empower your children to take control of their financial lives.
By teaching your children about money, you help them discover the relationships between earning, spending and saving. In doing this, children also begin to understand the value of money. This financial literacy can begin at a young age with simple money concepts such as counting coins and making change for purchases. Older children can learn about savings accounts, balancing a check book and creating a personal budget. The key is to teach a concept and let them try, even if it means a little extra time in the toy store while your little one painstakingly counts out coins from his or her piggy bank.
courtesy:http://www.investopedia.com/university/teaching-financial-literacy-kids/
TITHES AND OFFERING PRINCIPLES
Much of what is said about tithing these days is usually in the negative. That is, people often say why they don’t tithe or why they think tithing is not for the New Testament. That, of course, is not enough. I have on many occasions asked those who don’t believe in tithing what they do believe and the answers are not always very clear.
The truth is, even if you think tithing is not for today you cannot deny the responsibility to give, and if we are to give, then we should be able to articulate well the principles and the practice of giving.
It isn’t enough to say you don’t believe in tithing. If you believe tithing is over then you must say what has taken its place. I do believe in tithing and this and other posts give the reasons why. Hopefully, the posts in this series will inform those who do not understand and answer those who would say otherwise.
More Than A Doctrine We don’t teach just a doctrine we teach a philosophy. A “doctrine” gives form to your religious experience but it doesn’t give meaning or significance.
Many Christians and even many churches have ceremonies they follow in their religious expressions but these are nothing but empty traditions until someone sheds light on the purpose they serve and the context in which they started. Traditions aren’t bad because they are traditions but there must be sound philosophies motivating them. We do things for a reason and are driven by philosophies.
We practice the tradition best when we understand the philosophy. Sometimes, however, we challenge tradition because we don’t understand the philosophy. At other times traditions are changed because we do.
It is traditional, for example, for congregations to buy land and build buildings in which they conduct worship services, organize educational programs, offer counselling, arrange social events and so on. This tradition is being challenged today. The primacy of these activities is being questioned. This model is being decried because many useful purposes are not being served. People are becoming disenchanted with the church and leaving it behind.
One spin off to this trend is to question tithing. All the things people don’t like about church are funded by tithes. The thinking is, if the thing being funded is questionable then the funding method must also be dubious and what naturally follows is not very healthy. Everything is eventually questioned.
In this situation, with regard to tithing, many people simply humanize their giving. Whatever philosophies they have about giving for any humanitarian purpose bleeds through when they develop a plan for giving to God. That is, they give to God the same way they give to any other human cause. That may be acceptable on a human level but it may not represent biblical teaching.
And remember that everyone has a philosophy. No one approaches the Bible or God philosophically neutral. We are all philosophically driven even if we cannot explain clearly the philosophies we own. You cannot clearly substantiate any teaching of Scripture without giving philosophical dimensions to it and human philosophies will naturally take over unless reformatted by biblical influence.
Tithing, and the principles behind it, is more than just a doctrine we teach pragmatically or a new feature we add to conventional methods of financial management. It is driven by philosophies that are spiritually founded and is the primary evidence that your relationship to God is more than just casual. You could say that tithing represents the opposing opinion when it comes to human methods of managing finances. It makes a spiritual statement. It reflects an attitude of commitment toward God and His work.
And what is the first thing I would say about tithing philosophically? It is a matter of trust! Not can God be trusted but can we be trusted, to tithe? Can we be trusted to give a set proportion of our income to God every time it comes our way? That is tithing and that is truly a test of one’s trustworthiness. The truth is, a person who cannot be trusted to tithe cannot be trusted by God.
These are very strong statements but tithing represents a spiritual principle and overrides all other approaches to managing our financial resources. If we understand the philosophy then we have no problem with the practice. Even if a person disagrees with the practice they are still responsible for the philosophy. If tithing is not evidence that a person can be trusted by God, what is? What is your philosophy?
So far, in preceding posts, I have explained why Jesus didn’t re-teach tithing and discussed the long history of this practice in Scripture. In future posts I will give reasons to show that tithing is practically and philosophically the rational thing to do.
courtesy:http://www.modeloff.comhttp://nowthinkaboutit.com/2009/07/the-philosophy-of-tithing/
"We make a living by what we get, but we make a life by what we give."
Save, spend and give—my big three principles. Most people forget about the giving part because they think I only scream "Save, save, save!"
Giving liberates the soul of the giver. You never walk away feeling badly. Whether through a tithe, charitable contribution, or gift to a friend in need, give away at least some of your money. Not only does it generate good, but it generates contentment.
Remember, no one has ever become poor by giving.
Is it acceptable to pause tithing in tough financial times?
The Bible does not mention anything about "pausing" tithing. Neither does it say that we will go to Hell if we do not tithe.
The tithe, which is a scriptural mandate, was not instituted for God's benefit because He already has all the money He needs. He does not need our money.
So why does He ask us to give 10% to Him? Tithing was created for our benefit. It is to teach us how to keep God first in our lives and how to be unselfish people. Unselfish people make better husbands, wives, friends, relatives, employees and employers. God is trying to teach us how to prosper over time.
Many people have observed that after they stopped tithing, their finances seemed to get worse. In the Book of Malachi, God promises that if you do not rob Him of your tithing, He will rebuke your devourers and protect you.
If you cannot live off 90% of your income, then you cannot live off 100%. It does not require a miracle for you to get through the month. I think that if you sit down and look at your budget, you will see that you can make it while giving at least 10%. Read the Bible and take from it what you will, and if you tithe, do it out of love for God, not guilt.
I do not beat people up for not tithing because Jesus certainly did not, but let me encourage you to keep tithing.
Is it right to count my church tithes on my tax returns?
You gave the money to the church. You were biblically obedient in that. The Bible also tells us to be good managers of our money. It does not diminish the sanctity of your gift to take the tax deduction. It is a way to manage the rest of the money. Take the deduction.
Later when you get your income tax refund, remember that this is money that you've already tithed, although you're certainly welcome to devote some or all of it back to the Lord as additional thanks for His blessings.
I'm making more money now. How should I increase my giving above the tithe?
When things are going well, it's easy to accidentally spend all the extra income, so I would recommend that you budget what to do with it.
For example, Sharon and I set up a budget based on my salary. This budget includes giving, spending, and saving—just as I advise others to do. Then, everything else we make is divided among extra giving, extra investing, and some blow money.