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Proverbs Guide to Finance

The proverbs of Solomon son of David, king of Israel: for attaining wisdom and discipline; for understanding words of insight; for acquiring a disciplined and prudent life, doing what is right and just and fair; for giving prudence to the simple, knowledge and discretion to the young- let the wise listen and add to their […]

PGTF stands for Proverbs Guide to Finance, and it is the basis behind this site. It’s been said that you can get a Master’s degree in Finance if you read Proverbs through a few times. I heard it last from Dave Ramsey, but I don’t know who said it first. I’ve come up with what I think are the 7 main principles of finance from Proverbs, and this is the first one.

Dishonest Scales

The Lord abhors dishonest scales, but accurate weights are his delight. Proverbs 11:1

Proverbs 16:11 – Honest scales and balances are from the Lord; all the weights in the bag are of his making.

Proverbs 20:10 – Differing weights and differing measures – the Lord detests them both.

Proverbs 20:23 – The Lord detests differing weights. And dishonest scales do not please him.

So what does God mean by dishonest scales and differing weights? Well, a good example would be a gas station that didn’t actually give you a gallon of gas when they say they are. The pump could rigged such that you only get .95 gallons for every gallon you pay for. Another example could be a grocery store that has a scale that reports a number higher than the actual weight of your produce. These are simple examples, but they get the point across as to what these verses are talking about.

You say, well I’m good because my business doesn’t weigh anything. That is not the case. The point behind the verses is we have to be honest in all of our dealings. If you lie to your employees or bosses or customers you are breaking this principle. If you produce a car that isn’t safe and then try to cover it up it will come back to haunt you. The truth comes out in the end no matter where you are trying to cut corners. You are going to be better off in the long run if you treat everyone with honesty and respect.

Let me know of other examples you know of that represent dishonest scales. Has anyone seen this play out, i.e. a gas station getting caught by an inspector?

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Proverbs Guide to Finance

by Derek Clark

The proverbs of Solomon son of David, king of Israel: for attaining wisdom and discipline; for understanding words of insight; for acquiring a disciplined and prudent life, doing what is right and just and fair; for giving prudence to the simple, knowledge and discretion to the young- let the wise listen and add to their learning, and let the discerning get guidance- for understanding proverbs and parables, the sayings and riddles of the wise. Proverbs 1:1-6

If you want to get a good start on understanding the principles of personal finance, sit down and read Proverbs. If you are looking for it, it is full of sound advice on money and life. Over the next few posts I’m going to share the main principles I’ve taken from it. There are many more, but these are the top principles I think you need to understand and follow.
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While tax season is thankfully far from the near future, it is still never too early to begin thinking about preparing your taxes for next year as this will allow you to take advantage of deductions that you may have missed otherwise. As you may be painfully aware of, each year tax deductions are subject to change and ones that you were normally able to claim may no longer be applicable. The year 2009 emerged as a clear example of just how drastically tax guidelines can change, as new credits were introduced in order to help taxpayers through the economic downturn. 2010 has already seen its fare share of alterations and if the HR 4213, American Jobs and Closing Tax Loopholes Act, is passed these changes will only be the beginning.
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For the love of money is a root of all kinds of evil. Some people, eager for money, have wandered from the faith and pierced themselves with many griefs. 1 Timothy 6:10.

People are. So the good people need to learn how to build wealth. I’m sick of people talking about “greedy rich people” or “evil CEO’s.” Having money doesn’t make you greedy or evil. Not having money doesn’t make you good either. Money or lack there of doesn’t have any bearing on what type of person you are.

Money is simply a means to trade goods and services. It makes transactions convenient. It is a little worthless piece of paper, or some bits in a computer somewhere. Having more of it just means you can do more things with it. You are the person that decides whether those are good things or not. Many people with great wealth use it to better the world. Bill Gates and Warren Buffett are actively working to give away their fortunes. Buffett actually pledged 99% of his wealth to go to charity during his life or at his death. That is a huge sum of money.

Having money didn’t make either of those men greedy or evil. It simply benefited the rest of the world greatly. They actually have been secretly (until recently) trying to get the billionaires of the world to pledge at least half their wealth to charity before they die. This could result in over half a trillion in donations to charities around the world.

Now before everyone starts to give me examples of evil rich people, I know they exist as well. First, the point is it isn’t the money that makes them evil, it just magnifies it and lets everyone else see it. I know plenty of poor jerks as well, they just aren’t famous. Second, the thing to realize here is that the money can just as easily magnify good as it can evil. That is why I started this website. Christian Common Cents is about teaching the good people how to get out of debt and create wealth.

If we can get more of the good people to stop making stupid financial mistakes, we can make this world a better place.

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The ongoing recession has put a tight squeeze on family budgets for the past two years. With priorities changing every month based on inconsistent cash flow, how can anyone put away anything for retirement? It is easy to get distracted in these troubled times, but there is no time like the present to do a little financial planning and realize that savings, put away on a regular basis for the long-term, are the only way to provide for dignity and pleasure during our second adulthoods.

Retirement planning, to be effective, needs to start in the present tense. You must accept that earning potential declines on a steep curve as you put on the years. Our young-minded society has yet to accept that we may be useful when we advance in age. However, average lifetimes are also increasing. The cost of living for a nice affordable lifestyle has risen with inflation.
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Control Your Cash Review

by Derek Clark

Control Your Cash: Making Money Make Sense by Greg McFarlane and Betty Kincaid was an interesting read. (That’s an Amazon link by the way). Basically it is a personal finance book that covers all of the basic topics: cars, credit cards, houses, investing, budgeting, taxes, etc.
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A few weeks ago a my wife and I paid off our last non-mortgage debt. Baby step 2 is finished! We paid off $28,000 in 10 months. We worked hard and we sacrificed, but it was so worth it. We didn’t only eat beans and rice, (I don’t really like beans so it was just rice ;-). Kidding aside, we still had a life. We just found ways to have fun without spending lots of money. Board games with friends is a lot of fun. It is also much cheaper than going out to dinner and a movie.

Next up on the list is baby step 3, a bigger emergency fund. We have been sending so much money to Sallie Mae, it is going to be really great to get to pay ourselves for a change. For those that have made it to this step, this is a pretty awesome feeling. I’m glad to join you. For those that are still on the way, keep working. It’s worth it.

Did He Say Giveaway?

Yep. Just a book, but it’s a pretty good one. Enjoy Your Money!: How to Make It, Save It, Invest It and Give It. <--Amazon Link, I gotta work on that emergency fund. All you have to do to enter is subscribe. If you subscribe by rss feed, leave a comment below and let me know. If you use the email, no need for a comment, but feel free to leave one anyways. The contest will run until next Friday the 18th. I'll randomly draw the winner and contact them by email. Good Luck.

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This is a guest post by Mariusz Skonieczny. He is the founder and president of Classic Value Investors, LLC, an investment management company. He is also the author of Why Are We So Clueless about the Stock Market? Learn how to invest your money, how to pick stocks, and how to make money in the stock market.

If you are a beginning investor, it can be very confusing to listen to others who give you advice on how to invest your hard-earned money. The best thing that you can do is ignore most of the advice and educate yourself following the strategies of investors who successfully built wealth over long periods of time, not just over the last few days, months, or quarters. I would suggest reading lots of books on the subject of value investing.

The major theme that you will get from reading these books is that in order to be a successful investor, you must think that when you buy stocks, you are investing in businesses because this is exactly what stocks represent. When companies are started, they usually are funded with some type of private or venture capital money. When a company becomes big enough, its management might turn to the public markets to raise money to pay off the original financial backers and to grow the business going forward. When that happens, the company issues shares to the public through a process called the Initial Public Offering, and these shares are assigned ticker symbols such as DVR or MORN.
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This guest post is by Sharon Smith. She is a financial writer associated with the Oak View Law Group. She offers advice on various debt management plans.

Getting into debt is much easier than coming out of it. The debt is considered to be a labyrinth where it would be difficult to trace the exit passage. This article gives you some real helpful tips by which you can save money as well as enjoy a debt free life.

1. Do not incur new debts:
Things you should avoid so that you don’t incur more debts are-

a. Stop using your credit card

b. Do not fall in to the trap of signing up for new credit cards

c. Do not go for payday loans
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One man gives freely, yet gains even more; another withholds unduly, but comes to poverty. A generous man will prosper; he who refreshes others will himself be refreshed. Proverbs 11:24-25

Over the weekend middle Tennessee was hit with a huge storm and massive flooding resulted. We got around 13 inches of rain, the previous record was around 6. This caused flooding everywhere, including downtown. The flood stage for the Cumberland River is at 40 feet. It crested almost 12 feet higher at 51’9”.
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