Money’s a good thing isn’t it? Or is it? I wonder how well you’ve planned your finances. Your day-to-day budgeting, your savings, your retirement savings. Because as things turn out, money is a great servant but a terrible master.

Berni: Alex, great to have you on the program.

Alex: Thanks for having me Berni, great to be here.

Berni: Hey, tell us a bit about what you’re doing these days.

Alex: Yeah, well I used to be a financial planner so I had … for many years I’ve been giving advice to people both originally as a stockbroker and then as a financial planner. But then I decided, and really God put on my heart, to see how I could help people to really become great stewards with the financial resources that God’s blessed us with.

Now some of us are blessed with a little; some of us are blessed with a lot. It doesn’t really matter. But either way we’re called to use that money that God has given us to honour Him and to glorify Him. So I created ‘Wealth with Purpose’ on the idea of teaching Christians both the biblical principles, which often surprises people to find out just how many principles there are about money in the Bible, and then to actually give it practical application. In other words, how do you actually take the Bible and apply it to your day-to-day life and day-to-day financial management?

Berni: You’re on the right program then, we’ve got the right guy, that’s good. Now in this whole game of being a financial adviser I guess you counselled lots of people and lots of couples over the years.

Alex: Absolutely, I’ve probably spoken to thousands of people now I suspect but in terms of our actual business, we hope, you know, a couple of hundred clients. In terms of helping them with insurance and retirement planning and investments and all that sort of thing.

Berni: The book ‘Rich Dad, Poor Dad’ I think would have made this whole thing quite famous. But over those years of helping people with their finances, what are some of the big mistakes that you saw people make? I guess there are common ones that happen over and over and over again.

Alex: Probably the most common one I think in today’s day and age is lack of savings. You know a lot of people … young people particularly complain, they say, “It’s really hard to save money”. And I think that comes from our society now is so consumption based that we’ve really gotten away from being a savings culture. In fact, back in the 1970s we used to save 16% of our income. Just prior to the famous global financial crisis it got down to -3%. You know a decade later…

Berni: So that means we were spending 3% more than we were actually earning.

Alex: Exactly and of course racking up debt and that’s not just at an individual level, it’s of course at a government level as well.

Berni: We see that with governments right around the globe, right? They’re spending more than they’re actually getting in tax.

Alex: It’s mind boggling and it’s quite frightening. I think the sort of response to the global financial crisis has simply been governments feel a need to stop any downslide in their economy. They feel under pressure in order to …. getting re-elected and as a result running massive deficits.

Berni: So I think it’s an interesting idea biblically because we’re told that we should be generous, we’re told that we should be giving away sacrificially. There’s the concept of the tithe from the Old Testament and Jesus says ‘Don’t store up for yourself treasures on this earth.’ So how do you kind of reconcile this whole savings thing with what the Bible says?

Alex: Yeah, look, so I think there’s a few ways of answering that. Firstly, I’d make a distinction here between saving versus hoarding. Hoarding I think would be an unbiblical activity. Hoarding is really saving money, if you like, but for something that’s never, ever going to get used. It’s just putting money away, often out of fear – you know, fear that one day it may run out, whereas saving is actually about putting money aside for sensible things in the future. So for example many of us need to fund our children’s education. Even though I actually personally don’t believe in retirement in the sort of convention sense…

Berni: We’re going to talk about that later in the series.

Alex: Yeah, well I certainly think you still need to plan for it to the extent that some point in time you may either be physically unable to work or you get made redundant and so forth. So you still need to have money set aside to allow for the fact that your circumstances change as you age. So in that sense saving is quite biblical and in fact in Proverbs 6 it talks about the ant. That’s the analogy it uses and it talks about the fact that the ant stores away for the future and we need to do the same.

But as I say it’s a balance between saving and actually being generous at the same time. In fact, a really good analogy I use is when I talk about budgeting I give people a very simple rule. It’s called the 80:10:10 rule. So 80% should be for your day-to-day living expenses. 10% is what I call giving to God and really that’s a starting point not a finishing point, everyone’s circumstances are different but that’s a starting. And then 10% for long-term saving. So it’s a really simple model: 80% for living, 10% for giving and 10% for long-term saving.

Now over time as your circumstances change hopefully you can increase the giving. Of course hopefully you can increase the saving as well depending on what your circumstances are and the purpose for which you think God is wanting you to use that money for.

Berni: Young people in particular often buying their own home or their own apartment is beyond them. Young people often don’t think too much about saving, do they?

Alex: They don’t. I think our culture now is so … as I say it’s so consumer based. We’re attacked almost daily by advertising and so there’s a real sense of discontentment and a real sense of needing to keep up with the Joneses.

Berni: The latest phone, right? The latest bit of technology.

Alex: It’s amazing. Now it’s watches.

Berni: I’m wearing one.

Alex: The Apple watch, there you go. I think people feel under enormous pressure from society to conform in a particular way. And as Christians, you know, we really conform to you know the gospel and to actually try and use what we have to glorify God. So it’s a very different way of thinking. And it’s not necessarily easy because as I say every day you’re getting mixed messages from the world.

Berni: I can’t even walk down the dairy aisle in the supermarket without looking at the floor and seeing advertising messages being thrown at me. It’s happening all the … the statistics about how many advertising messages we’re hit with a day are outrageous.

Alex: Yeah and I think even when you look at people standing at a bus stop. Half of them these days are on Facebook. Facebook is just now giving them tons and tons of advertising. That’s a problem that’s not going to go away.

But I think the issue for people is to actually step back from it and actually really think about what you’re doing with your money. Actually plan it so rather than having a sort of spur of the moment sort of view of money and just going from one thing to the next, actually sit down and plan it out. Do a budget, actually see where your money’s going.

Berni: That’s probably the next biggest mistake, right? People aren’t saving enough but they’re not deliberate about how they manage their money.

Alex: Yeah and I think most people aren’t even aware of it. They’re not actually aware of where their money is actually going. You know, it feels like they’ve got holes in their pockets so to speak. And so unless we become aware of it, as the first step, and then actually putting what I call, if you like, very simple strategies into place to actually manage it.

So one, for example, is I try and tell people to … apart from doing a budget which will get you aware, is actually to try and automate your finances. So for example some people get paid weekly, others fortnightly, some monthly. But make it so that when that money comes into your account, set up an automatic sort of feature whereby the money sweeps out into a savings account or into your giving to God account.

And I also say to people that they need to have an emergency fund, that’s one thing. So many people end up with credit card debt because they find themselves in an emergency, they find themselves made redundant or a medical expense or something happens and they haven’t got the money there to help them. And so setting that money aside is very important.

But all of this requires planning. But the good news though for listeners particularly is money is actually quite simple. You only have to do very simple things. Put the building blocks in place, the foundations if you like, and away you go.

Berni: Alright we’re going to talk about that in the next couple of weeks on the program, Alex. Some good insights there. I guess when I was young it was easy to be deliberate because there were no credit cards, there were no overdrafts, when you ran out at the end of the pay period, you ran out at the end of the pay period. So it was a lot easier to plan, whereas now I can just waive my watch in front of the terminal and spend money willy-nilly. And the choice now is mind boggling.

Alex: Yeah.

Berni: By the way, you run an organisation called ‘Wealth with Purpose’ right?

Alex: That’s right.

Berni: Tell us very quickly about that.

Alex: ‘Wealth with Purpose’ was set up really … I describe it as a stewardship ministry. But really what we’re trying to do is to teach Christians what the Bible says about money, which is an enormous amount, and then put that together with practical application.

Berni: Is there a web address people can check out?

Alex: Yes, it’s wealthwithpurpose.com

Berni: wealthwithpurpose.com. Worthwhile going to have a look. Mate we’re almost out of time. We’ll catch up again tomorrow and have another talk about how we can effectively manage our money in a godly way.

Alex: Fantastic, look forward to it.

Berni: Fascinating stuff and Alex will be joining us again for the rest of this week and next week on the program. That’s ten interviews in all about your money, your finances. It’s such an incredibly important subject for us to think about and get right in our lives. Remember, money is a great servant but a terrible master.

I’m sure as you look back on your life you can see some mistakes that you’ve made in the area of your finances. I certainly can. And, you know, it would be kind of nice if we avoided those mistakes in the future.

Berni: Alex, welcome to the program. I guess even though these days you’re a bit of a money expert, right? Call I call you that?

Alex: I don’t think there is such a thing!

Berni: I guess you’ve made a few mistakes along the way yourself?

Alex: I’m embarrassed to say but yes, absolutely. A few. More than one.

Berni: What sort of a household did you grow up in? Was it rich or poor? Did your parents manage their money well or not? I mean, what did you take away from your upbringing?

Alex: Well actually quite a bit. I did grow up in a very affluent household by world standards. And look, that was good in many ways in the sense that my father actually ran a bank so you would hope that I’d be reasonable at you know …

Berni: You’d hope so.

Alex: At finance. So … but I guess some of the more negative sides is probably picking up spending habits. Because we were reasonably affluent we had lots of nice things: nice holidays and things like that. And, in and of themselves, there’s absolutely nothing wrong with those things. But the problem is when you’re young those things can become very, very desirable and you end up spending more money than you’re actually earning which is a common problem.

So one of the mistakes I made was at 21 I had nearly $21,000 in credit card debt, it had got close to that. So I’d been at university, I had part-time jobs. I had lots of nice holidays in-between: overseas trips, skiing, you know … and that obviously built up quite a bit of debt over time. So it wasn’t until I entered full-time work that I could start paying that back.

So that was one of the mistakes I made. And I think it came from living in a house where everything was quite easy, very comfortable, and always talking about holidays and the next thing.

Berni: It’s interesting; when you left home you discovered that all of a sudden, things that used to be free are no longer free.

Alex: Yes.

Berni: And so it takes a little while for young people …

Alex: Absolutely …

Berni: Very much to adjust to that. It must have been a sobering thing to have to climb your way out of that debt. Did your parents help you or did you actually have to dig your way out of that hole?

Alex: No, I paid it all off myself. I can’t remember how long it took. I would have taken probably close to two years I suspect back in those days when my income was obviously a lot less. But certainly it’s a tough lesson. And I think these days young people are almost targets because credit is so easy and you know, these days you can actually tap and go. Money has become so easy it’s frightening. And therefore we’re actually quite vulnerable in one sense.

Berni: When you were a young guy, what were your hopes and dreams and ambitions? What did they look like?

Alex: Yeah and I think actually this is interesting because it raises a great point. Is how you think about money affects your behaviour. One of the things …

Berni: Say that again, it’s important.

Alex: It’s very important. How you think about money shapes the way you will behave with money.

Berni: OK, explain that.

Alex: OK so … and then once again this is a kind of a bit of a confession. So growing up in a house where I had a very successful father. You know, running a bank, you know, and running very big businesses. I had a drive to be successful. Now in some ways that can be not necessarily a bad thing, but can become a bad thing in the sense that you become quite status driven.

How you look and how you appear to people becomes important – be it the way you dress and the car you drive. So for example at probably 21, 22 I had an expensive European car. It was debt funded and a lot of that I think was driven by my psychology at the time was that desire to want to look successful. And I mean to both be successful and actually to look it as well.

And so it’s kind of that way I thought about money. Because it was wrong. Certainly wrong from a biblical perspective. You know, the call from a Christian point of view is to use your money to honour God and let him get the glory rather than you get the glory from mankind. And so you’re often chasing the praises of man rather than the praises of God.

Berni: Were you a Christian back then or not?

Alex: I was but I’d been a Christian from … I became a Christian aged 17 so I think like most of us you make mistakes along the way. But I was from a non-Christian household so I’d never had you know, Christian ways drilled into me from a young age.

Berni: OK, so you got yourself into this debt because you thought you had to look good and live the expensive lifestyle. I presume at some stage you got married and the whole mortgage thing happens and all those responsibilities. When you got into that situation, what other mistakes did you make?

Alex: So I think the biggest challenge I’ve had I think is mainly around mindset. The biggest learning I’ve had over the last sort of 10 years of my adult life has been that the money I have is actually God’s money.

Because when you think of it as being your money, and most people … the trap I’ve had for most of my adult life is – it’s my money, I’ve worked hard for it. And when you think like that there’s a tendency to want to use all that money for yourself and to just, you know, spend on having a good time. But when I realised that actually, well, I’m a Christian and I’ve got to actually use the treasure if you like that God’s given me to do good things with it, to help those in need.

That really changed my mind set and so my … if you like my behaviour with money went from being one of saving very little to one of giving much more. And of course behaving and becoming much more sensible. And certainly when you do get married and have kids that sort of sharpens the focus. When you’re young and single you tend to not think about that too much.

Berni: Yeah, totally.

Alex: So it does definitely change.

Berni: Yeah. It’s interesting. You and I had very similar lives and young men. I relate to a lot of what you’re talking about. I’d be interested in your take on this. What I found though, ultimately, is the stuff I was able to buy with my money, whilst it might have given me a short-term fix, never really satisfied anything.

Alex: Absolutely right. Most things wear out within six months and the new car’s great for what, the first five or six weeks. And after that, oh yeah, it’s just a car. But unfortunately though, if you buy with debt, the debt hangs around for five years plus.

Berni: Absolutely.

Alex: So it’s certainly hard to get out of that because it’s so ingrained. And one of the things when I teach our courses on money is really trying to help people to understand their values. What shape them. Because your upbringing has a very profound effect on the way you think about money.

And so you really need to try and be honest with yourself and understand who you are and what’s driving you. And realise that that’s not necessarily aligned with God’s word and that you need to, over time, actually align your finances with God’s word.

Berni: What’s a pivotal passage for you in aligning your finances with God’s word?

Alex: Yeah, I love the passage that says:

Seek first His kingdom and all these things will be given to you.

Because, you know, one of the principles we talked about in the Bible is that we need to put God first in our life. And Martin Luther famously once said, ‘There are three conversions: the head, the heart and the wallet.’ And often the wallet comes a long time after. But if we were to be true to ourselves and say that as Christians we’re going to put God first then that needs to happen with our money too.

Berni: A lot of Christians are really touchy about that. The moment a pastor gets up and talks about money, right, people go ‘Ah right, hang on.’ People get really touchy about that. Why is that do you think?

Alex: I think money is one of the biggest things in life that can come between you and God. And it’s always competing with God for your attention. And as a result, people when they hear their pastor talking about it, it can make them feel uncomfortable because it’s actually dealing with an idol in their life.

Berni: I heard one preacher once say that the nerve that runs from your heart to your wallet is particularly sensitive.

Alex: It’s very true. And so look, we know we have to over time acknowledge that it is a real issue. And you’ve kind of got to watch yourself. It’s one of those things where you’ve got to guard your heart constantly because it’s a pressure that will never go away. Because the world is always telling you one thing and the then you’re reading the exact opposite in the Bible.

Berni: What I find encouraging hearing your story is you started off the way we all start off: stupidly with debt and making mistakes and stuff. But somehow by spending time in God’s word you’ve kind of got that sorted out. You know, I’m not saying the pressure’s gone away but you’ve fundamentally got it sorted out in your life.

Alex: Yeah, I think there’ll always be that pressure. There’s always things out there. And I think when it comes to say, keeping up with the Joneses for example, the problem with the Joneses is they’re sitting right beside you every day. They’re at work or in church. So you’re always going to have that kind of pressure. But as you mature as a Christian and when you start to realise what life is really all about and the purpose you’re here for, your calling and so forth. When you know your calling and your assignment in life you can really channel your energy and your finances towards what you’re called to do. So it changes.

Berni: Good stuff Alex. We’ll talk about this some more another time.

Alex: Fantastic.

You’ve heard that old Chinese curse, I guess, “May you live in interesting times”. Well, these days we certainly are living in interesting times. Very interesting times, especially when it comes to this whole topic of money and finances.

Alex: Thanks for having me, Berni.

Berni: Hey, is it just me or had the world gone crazy? I mean governments seem to be spending so much more money than they have. What’s going on in this world?

Alex: Yeah, look, it is quite amazing. I mean we’ve got a situation, really around the world, where we’ve been living beyond our means for a very long time. Probably 30, 40 years. As a result of that, it’s now sort of coming home to roost. There’s a lot of pressure on societies. Most governments around the world have racked up enormous debts over a very long time. Through running what we call budget deficits. Which simply means there’s more money going out in terms of spending versus money coming in in the form of taxes. And you can only do that for so long before you go broke.

Berni: That’s not rocket science, right? I mean, you and I both know that in our personal budgets.

Alex: Exactly right, it’s not. But I think the problem is governments feel under enormous pressure to deliver on what they’ve promised. And no politician wants to be the bad guy who takes away the cookies, if you like. So many of them have promised all sorts of things and you see these endless debates on TV around issues around healthcare, retirement, and so forth.

And so governments have promised many benefits for the citizens into the future that 100 years ago they either didn’t need to pay, because of demographics: we didn’t live as long 100 years ago. But now we’re living longer the pressure on the economic system is much harder. The number of people in the work who are supporting paying taxes to fund people in retirement, for example, is very, very out of whack and it’s getting harder and harder.

Berni: I mean, US debt is ballooning, right?

Alex: Yeah, I mean their government alone owes $19 trillion and that’s just the federal government. That doesn’t include state local government and doesn’t include the household debt which takes you to $60 trillion and it’s mind-boggling.

Berni: Just to put trillion in perspective, if I were to count from one to a trillion, right, one second at a time would take me almost 32,000 years. Just to put the number trillion … because trillion doesn’t mean anything to us, right? It’s an unbelievably large number.

Alex: Exactly, although the question I always ask people is how many zeros in a trillion.

Berni: What is it?

Alex: It’s 12 zeros, it’s frightening.

Berni: And so is that spending behaviour translating into our personal psyche as well?

Alex: Absolutely. I think it’s very pervasive now at the household level. Many of us feel under enormous pressure to, you know, to keep up with the Joneses. To have this sort of pressure to have a house, to have a car, to have all these sorts of things is … it’s endless.

Doesn’t matter really where you live in the world there’s always a pressure to have more. And the media certainly feeds on that through advertising and so forth. So it’s very, very difficult for now for people to try and bring in the biblical perspective and the eternal perspective into their money.

Berni: OK, well let’s talk about the biblical … because it’s going to take eternity for some of these people to pay off their debt.

Alex: Yeah.

Berni: Right. So let’s bring the biblical perspective. What are the … what does God’s word actually have to say about money, about wealth, about debt. What’s the stuff that strikes you for from God’s word?

Alex: You know, look, well, it’s amazing how much it does say this. More than 2300 verses in the Bible on money, wealth and possessions.

Berni: Wow.

Alex: And it was 15% of Jesus’ teaching. He talked about money more than anything else. Of course there’s good reason for that. And that is because of the impact that it has on our relationship with God. But in terms of day-to-day finances, one of the classic ones is in the Proverbs where it says debt can lead to slavery. It’s a warning message.

In fact, many of the messages in the Bible about money are actually warning messages. So the problem at the moment, when we’re talking about these debts around the world and in the US and indeed in most countries, is you have to pay the debt back.

Berni: Yes.

Alex: And of course you have to service the interest on the debt. And as the debt gets bigger and bigger it gets harder and harder just to pay the interest bill. The most frightening country in the world, I think, is Japan where a third of their government budget is just paying the interest on the debt. And the interest is at 1% or below on the debt.

Berni: Wow.

Alex: So if interest rates went to 3% in Japan, essentially the entire government revenue consumes the government budget. It’s frightening.

Berni: That’s scary. What about at a personal level. What bit of wisdom have you got for someone who’s maybe not that well off? I mean we look at all these big numbers with governments and all these wealthy people who drive flash cars. That’s well and good. But the average person on the street, particularly the average person who’s struggling even to put food on the table. What does God’s word speak into their life about money?

Alex: Well the first thing I think is it speaks very much to your mentality and your perspective. And that is to firstly acknowledge that the money that God has given you, whether it’s a little or whether it’s a lot, is actually God’s money. And when you have that perspective it totally changes the way you think about it.

Berni: How did it change your way? Like, it’s easy to …

Alex: Say …

Berni: Say that, right.

Alex: Yeah.

Berni: But how do you live that, how do you live this notion that the money, the resources that I have do not belong to me? Because I suspect that very few people live that way.

Alex: I think you’re right, in most cultures. I think for me it started by assessing the way I spent my money and saying does my budget, does it honour God? Am I using the money to fund the things that I really believe in? You see, what you do with your money really actually states what you believe. In fact, once … someone said to me once that your bank statements are like theological documents because they tell you what you believe.

Berni: Yeah.

Alex: How you spend the money from your bank account or your credit card really says a lot about what you truly believe. And so for me the big shift is thinking, ‘Well, OK, if that’s the case I need to actually start using this money to fund what I believe’. And what I believe of course is that Jesus is coming again and I want to share the good news with as many people as possible. So I need to use the money to fund that.

Berni: But OK, let’s say I’m not that flush with money. Let’s say I don’t have that much to spare, right. And now it’s a decision between not just giving towards something that is happening in God’s mission field and my luxury spending, my discretionary spending. But it’s actually going to bite into seriously my lifestyle and how much food I can put on the table and where I can live and … What do you do with that?

Alex: Yeah, and look I think everyone has to pray and ask God for guidance with what … the kind of lifestyle he wants. We all live in different parts of the world, in different circumstances. And we actually … you know, God needs people in poor communities, he needs people in rich communities. But on a personal level I think as Christians we should live what I call simply. That is, we don’t need to live extravagantly. And what we do with our money should have an eternal perspective to it. So if you have a tough decision between giving up something now and having something, you know, in the future. Sometimes we need to give it up now because of the … the reward will actually be in heaven.

Berni: Yeah.

Alex: You’ll be rewarded for what you do with your money. And that’s something … Not only will you be rewarded but we actually have to give an account.

Berni: Yeah.

Alex: We actually have to say, ‘God, this is what I’ve done with the resources you’ve given me.’

Berni: Well that’s the parable, isn’t it? The three servants and the master gave away. Gave one five talents, the other two and the other one talent.

Alex: Yeah.

Berni: And expected a pretty significant, 100% return.

Alex: Return, yeah. Multiplication.

Berni: Yeah a big return, yeah. The guy who did nothing, he was in some serious trouble.

Alex: Yes, and that whole parable I think speaks to a few things. I think one that we’re stewards of what God’s given us. Two is that one day Jesus will return and we have to give an account for what we’ve done. And the third thing of course is that what he’s given us, we’re actually to do something with it.

We have to, I call it investing in eternity. Now that doesn’t mean you’re putting your money in property or the share market or whatever. But whatever you’re doing with your money, you need to invest in eternity. Because one day we’re going to give an account and we’ll of course be rewarded for what we’ve done with the resources that God’s given us.

Berni: The most profound part of that parable for me is that a talent wasn’t a small amount of money. A talent was actually about 15 years’ wages for a labourer. So even the guy who got one talent got 15 years’ wages to invest which is rather a lot. And the guy who got five talents got almost, well, more than a lifetime’s worth of wages to invest. So God has really given us all rather a lot.

Alex: Absolutely. And often we forget that. I think one of the big things is to actually be grateful.

Berni: Yeah.

Alex: And to be content with what we’ve got.

Berni: Yeah.

Alex: Which is challenging in this world we live in.

Berni: Contentment is hard when the advertising industry keeps on making you discontent.

Alex: Absolutely.

Berni: Alright, great talking to you. We’ll do this again, hey?

Alex: Absolutely, look forward to it.

If ever there were a tricky combination – it’d have to be combination of marriage and money. Anyone who’s married knows exactly what I’m talking about, perhaps, hey? It kind of makes a lot of sense for husband and wife to get on the same page when it comes to the often difficult area of their finances.

Berni: Alex, great to have you on the program again today.

Alex: Thanks for having me, Berni.

Berni: Mate, why do so many people, in fact so many couples, struggle with money?

Alex: Well I think when it comes to couples we all come into marriage with very different things. We come in with different upbringings, different cultures in some cases, different personalities, gender differences. There’s all these sorts of things about us that are different.

And also you put these two people together, and as Christians we call it two becoming one, and sometimes that can cause quite, you know, chaotic behaviour. But if we address, say, the issue of upbringing.

OK, so one partner may come from a family where money was tough, it was always hard. And that person’s likely to be fairly security conscious because they always struggled and they’re always looking for a way of sort of protecting themselves so that they don’t find themselves in the same situation that they had when they were growing up.

Other people, on the other hand, may have grown up in a family whereby they were big spenders. Money was easy, it was all care-free and they just spent everything. So when you put those kind of two people together, there can be immediate conflict. Because there’s a conflict then over perceived needs versus wants, and one could see … and that could be very, very different as to what those needs and wants are.

Berni: Yeah, it’s not easy. Why are Christians called to manage their money differently from everyone else?

Alex: Yeah, I think from a Christian perspective we need to look at it as being God’s stewards. So stewardship is really the idea that we are managing something on behalf of somebody else. So as a Christian you’re managing the resources on behalf of God.

In fact, I call it the three ‘T’s. You’ve got to manage time, talent and treasure. In the context of what we’re talking about now, we’re talking about money. So how do you manage the treasure that God’s blessed you with? So the Christian view, then, with money is as I was saying, “OK if it’s God’s money, what are going to do to honour God with that money? How are we going to glorify him, how are we going to use this money in a way that advances His kingdom, His purposes?” Because that’s ultimately why we’re here. We’re here, you know, we get saved, we get saved for a reason so that we can actually then extend His kingdom here on earth.

Berni: Let’s bring that into marriage. Boy meets girl, they fall in love, they decide to get married, right. Often they come into a marriage these days with quite disparate financial situations and one of the things that’s becoming very popular round the world now is pre-nuptials, right.

Alex: Yes.

Berni: This idea that, ‘Well this is my money and if something happens to our marriage then these are the rules.’ What’s your take? From a biblical perspective of two becoming one …

Alex: Yes.

Berni: Husband and wife. What’s your take on this whole prenuptial thing?

Alex: Well, look I think pre-nuptials – it’s built from the idea that it may fail one day. And I think as a Chris … that’s a very flawed way of thinking. Because if you go into marriage thinking it might fail, then it probably will. I actually think you’ve got to actually start from the perspective that we will never get divorced and that’s got to be your attitude when you go into it. And therefore you’re much more on the right page.

From the point of view of two becoming one, so how is a couple … what does that really mean when it comes to money? Well I think the first thing is you need to have a common vision. Because often what happens is we all have different interests, different passions and pursuits and we often then wander off as couples in different directions. But I think as a Christian you need to actually bring that back in. So what is the common vision?

We’ve named our organisation ‘Wealth with Purpose’ for this reason. Because as a couple your wealth should have a purpose. The other thing is our society now teaches us that we have to be independent. And that’s a very dangerous way of thinking. As a couple you need to be interdependent on each other and dependent on God for your provision. Because if you’re just running off in your own direction being independent, inevitably you’re going to clash. And it then becomes his and her money. Whereas in fact it’s not even his or her money, it’s not even our money, it’s actually God’s money. So it really changes the way you think about it.

And I think also we should have shared goals, shared vision, and shared responsibility and, you know, contributing. And it may not necessarily be financially contributing but actually just contributing with what you’re doing with those resources.

Berni: What are some of the real financial danger zones that couples fall into, they need to avoid?

Alex: Probably the most common one these days is excessive debt. Because when you get into excessive debt it puts enormous pressure on the marriage. Particularly, let’s say one or both partners are out of work. All of a sudden those mortgage payments become monumental. And that puts enormous stress on a marriage. So having excessive debt is a very common one.

And another one is hiding money. You’d be amazed how many couples I’ve witnessed where they’re actually hiding money from each other.

Berni: Really?

Alex: Yes, it could be hiding bonuses, it could be hiding credit card debt – there’s a big one – you know, they’ve racked up … spent money on the credit card. I remember having one client who was worth an enormous amount of money and the wife had racked up $25,000 on the credit card and the husband had no idea. And he … and they were very, once again very different personalities. He was the saver; she was the spender. And boy was there a clash coming when he found out. So that’s, you know, a very, very common thing.

There’s all sorts of areas. You know, it could be our insecurities, you know as we’re human beings we’re all broken in our own little ways and our insecurities can lead to bad financial habits. And that obviously can affect our marriage as well. But I think probably the biggest one is the difference in perception between needs and wants.

Berni: I’ll pick up on something you just said there. The idea of it being God’s money and who you actually trust. I think that the way we behave in terms of spending and saving and indeed hoarding for those who hoard, says a lot about whether we trust God or not.

Alex: Absolutely. I mean my view on this is that many people, they know about God, but they don’t really know God.

Berni: Yes.

Alex: So you can read the Bible and know about God but until you actually spend time with God, in prayer, in worship, in the word, and actually devote to getting to know God. And the example I use is like Barack Obama. OK, I know about him but I don’t really know him.

Berni: Yes.

Alex: Everyone knows about him because they hear about him on TV all the time. But they don’t really know him. And it’s the same sort of concept. To trust God with money you need to really know him. You need to know that he is the provider. That he is in complete control of all events. Because if you don’t really know God’s character and don’t have that relationship with Him, when the storms of life come, and they will come, you’ll find things much, much tougher.

Berni: What sort of strategies can couples use to manage conflict over finances? Because I guess a lot of marriages fall apart over finances. How can they manage this?

Alex: Look I say to adopt a very simple process around this. And the first thing is to identify whatever it is you’re fighting over. And that’s probably the easy part of it. The second thing is to then say, ‘Well what are all the possible solutions?’ And most likely you’re going to come up with quite different things.

And let’s use an example. Let’s say the car. The car’s broken down and it keeps breaking down. So there’s all sorts of solutions. One you could go and buy a brand new car, you can go and buy a second hand car, you can get the one you’ve got fixed, you can do a few different options. Then the next thing to say is, ‘OK, if we’ve got all these options, what is going to be the financial impact on that, how’s it going to affect our overall finances and of course what’s the spiritual impact? Do we feel that God has a view on this?’ Because I think many couples actually leave God out of all their decision making.

Berni: Well exactly. If we don’t see this money as God’s money, then the purpose that we have around our wealth, husband and wife can have totally different purposes.

Alex: Absolutely. And so in my view before all major financial decisions, now it could be buying a house, or even renting a house, buying a car, you know, going to college, all those sorts of things, that you should pray about it and ask God to guide you and to lead you. Because if you don’t, if you leave God out of it, you’re much more likely to make mistakes. It’s not to say you’ll never make a mistake again, but it’s merely to say that you’ve got to include God in your decision making process.

Berni: Mate, we’re almost out of time. Great chatting with you. We might do this again.

Alex: Fantastic, look forward to it.

Which one of us doesn’t know that unsettling feeling of getting the credit card bill in January after that Christmas shopping binge? Way too many people are spending tomorrow’s financial blessings today, living beyond their means and that’s ruining many a life.

Alex: Thanks for having me, Berni.

Berni: Mate, we’ve talked a bit about debt so far. But why, in a nutshell, is debt becoming such a bit problem in our society?

Alex: Well, really over the last 50 years, debt has exploded across the world. You know, most societies used to be nations of savers and now are nations of spenders. Certainly in the country we’re in it’s gone from people saving 16% of their income to, prior to the financial crisis, actually went negative.

Berni: OK.

Alex: Down to -3%.

Berni: Yeah.

Alex: So we’ve just totally shifted on it. And I think it’s because money and getting in debt has just become so easy.

Berni: It is, isn’t it?

Alex: Yes, I mean you can go to the bank, get a credit card. Apart from stating what your income is, they’ll give you a credit card. You know, pretty much on the spot.

Berni: I remember when I bought my first house as a young man, it was really hard to get a loan for a house.

Alex: Yes.

Berni: Whereas now, money is so readily available.

Alex: Yeah, I mean the scary thing I thought, prior to the financial crisis, is banks who’d actually lend people 100% of a home loan. In fact, one bank would lend 105% so that then you’re the government duties and things as well. It was just mind boggling.

Berni: And so debt’s become normalised, hasn’t it?

Alex: Yes.

Berni: The notion that we spend our whole lives in debt is kind of just, “Well, that’s the way it is.”

Alex: Yes, exactly.

Berni: What’s the Bible say about debt?

Alex: Haha, well the Bible says quite a bit on debt. And it’s basically warning messages. So one of the passages talks about the fact that debt can lead to slavery. That to me is the one that always really hits me. And that is when you take on debt you run the risk of becoming enslaved to a financial institution.

And one of the things I see, particularly in this country, is some people spend 50% of their income in mortgage repayments. Now that to me is modern day slavery. Because when you allow for taxes and all the other expenses in life, and as Christians you know we’re called to be generous, but when you’ve got that much debt you’re essentially enslaved.

Berni: So let’s talk about that. That means you’ve got to travel further, commute further, work further, work longer, get the bigger job that pays the extra money so that you can service the debt.

Alex: Exactly right. Debt steals from your future.

Berni: Yeah.

Alex: Because ultimately you have to pay it back and you’re taking … essentially spending future income. That’s the major problem with it.

Berni: But some people don’t even know they’re doing it because these days with credit cards and swipe and swipe that and whatever, a lot of people don’t even know that it’s happening until the statement comes – if they happen to open the statement when it comes!

Alex: Yeah, no, you’re exactly right, and it’s frightening. I mean the fantastic expression I heard from a Christian author once and that is that: ‘Debt in western culture particularly has become normal, harmless and necessary.‘

Now you think about each of those. It’s normal because everyone does it. People think it’s harmless until of course they get into trouble, so that may take years before that actually occurs. And that it’s necessary so the classic one I have when I’m talking to people is they tell me, ‘If I don’t have debt I’ll never own a home, I’ll never have this, I’ll never have that unless I have debt.’ And so that’s become the pervasive logic. But the Bible of course says that’s not true at all. In fact, I believe there are considerable alternatives to debt.

Berni: Well, OK. Young couple gets married, wants to buy a house. How are they going to do it without debt?

Alex: Well, I think the first thing is you’re obviously going to save. And we’re going to go back to becoming a nation of savers. But there’s a fantastic passage in Deuteronomy which I’ll read you, from Deuteronomy 28 because I think it really paints a different perspective on money and where it comes from. It says this, it says:

The Lord will open the heavens, the storehouse of his bounty, to send rain on your land in season and to bless all the work of your hands. You will lend to many nations but will borrow from none.

Now, there’s a couple of things from that. Obviously this was talking to a specific group of people rather than necessarily just us today. But I think the principle here is what’s important. And that is that ultimately God is the provider and if God wants you to have something, He can make it happen very, very easily. It’s not difficult.

And God, I believe, if that we … you know, we’re created to work, we’re not meant to, you know, just sit around doing nothing. We’re created to work and God …

Berni: That’s the mistake I’m making!

Alex: And God can bless the work of your hands, what you’re doing, to provide for you. And that’s, you know … the Bible says God gives us the ability to gain wealth. And so I believe you don’t necessarily need debt at all. In fact, by my own example I’ve never had a mortgage.

Berni: OK.

Alex: And I’ve bought my first place in cash.

Berni: OK.

Alex: Now most people say, ‘How, that’s impossible.’ Now it’s very possible by simply saving and following biblical principles working hard and setting money aside.

Berni: And I guess choosing where you buy. I guess …

Alex: True.

Berni: You wouldn’t be able to do that in the middle of New York on 5^th Avenue.

Alex: No, exactly right. And look, even in Australia and Melbourne, most countries it’s become harder. But certainly it’s the principle. And I’m not saying that debt is sinful, by the way.

Berni: OK, that was going to be my next question.

Alex: Yeah, no, debt is not sinful. I’m not saying that you shouldn’t have debt at all. Merely saying that you are very cautious, that you have an intent to pay it back very quickly. Because one of the things the Bible says is the wicked don’t repay. So there’s actually a moral burden on us to actually pay back the debts we take. And we should be … have that intention of paying it back.

Berni: Because now you can just get an interest only loan, right. And kind of almost never pay it back.

Alex: Oh, exactly right. And the thing in the United States prior to their big crisis which was a housing crisis that sort of triggered it. They have what they call jingle mail, that is if you default on your home loan you just send the keys back. Whereas in many other countries they’re what we call full recourse loans which means they come for the house, the car, and everything else you’ve got to pay back the debt.

Berni: Right.

Alex: So … but as I said, the biblical principle is we must repay. We have a moral responsibility if we borrow from someone we have to pay them back, alright.

Berni: What are the dangers you see in debt? I’m thinking of just an average couple who just have a little kid and they want to buy their first little home, nothing ostentatious, nothing … what are the dangers around debt that we need to be aware of?

Alex: Well, the danger of course is that you entrap yourself into a set of circumstances that you can’t get out of. You know, you’ve got the mortgage. One of you loses your job and then all of a sudden it’s a big struggle. Puts enormous stress and pressure on the marriage.

So in terms of the practical way to manage that because obviously most couples want to borrow money and actually go out and buy something. So I say to them, ‘Look, make sure you borrow 20 to 30% less than what the bank will give you.’ Because the bank’s strategy is to actually get you into debt. They just want to make sure you can at least service it and pay it back. They want you to take on as much debt as possible. So the first thing is take on 20 to 30% less than what they offer.

The second thing is that make sure that your mortgage repayments are no more than 30% of your disposable income. And ideally for couples, try and borrow on the basis that you can service it with just one income. Because there’s a very good chance that after you get married all of a sudden kids come along and then you’ve got a new set of pressures and things like that and things that are demanding from your financial resources.

So there are a couple of little things that people can do. But the main thing is – don’t have an attitude where you need to buy the big house straight away and … because many people they don’t want to start with a little two-bedroom unit, they want to go to the house and they take on too much debt too soon.

Berni: OK, very quickly. Simple strategies for getting out of debt.

Alex: Well first thing is make a list of all your debts.

Berni: Yeah.

Alex: OK. Once you’ve made a list put them in order of highest interest rate debt to the lowest. Because you want to pay off the highest rate debts first. I also say to choose the smallest debts, so the smallest, high interest debts which are most likely to be say credit cards. The reason why you want to choose the smaller one first is because you want to have a sense of achievement …

Berni: Yes.

Alex: That you’re paying those off. So you’ve got your order, you know which ones you want to pay off first. Then look at your budget and say how much extra can we pay against our debts to actually pay it off quicker. So rather than just servicing it and paying the minimum actually pay off extra to get your debt down as quick as possible.

The other thing is potentially to assess some of your assets and say, ‘Do we really need this asset, is this something that we could sell in order to reduce our debt?’ So maybe you’ve got two cars and you go to one. Or your house is … you don’t need it, it’s too big, you may … or maybe you’re honest with yourself and you say, ‘Well, we over extended ourselves so maybe we should just downsize.’ All those sort of things to consider to get out of debt as quick as possible.

Berni: Some really good stuff there. We might continue this discussion on next week, what do you reckon?

Alex: Fantastic, look forward to it.