Personal Finance Series | Part 6 of 6
Being a good steward starts with multiplying His blessings, but the fruit is in how we then use these blessings.
Paul writes in 2 Corinthians 8:14, “At the present time your plenty will supply what they need, so that in turn their plenty will supply what you need. Then there will be equality.” If you add to that idea the attitude of early Christians as Paul tells us in Acts 2:45—“Selling their possessions and goods, they gave to anyone as he had need. . . .”—it is fairly clear that not only were they filled with the spirit and love, but also that they knew the impact of their giving.
Romans 12:6 tells us, “We have different gifts, according to the grace given us…” and then identifies giving as a spiritual gift challenging us in verse 8, “…if it is contributing to the needs of others, let him give generously.”
In many familiar verses we are told of our duty to the poor, brothers and sisters without clothes, those in need and are warned in 1 John 3:17, “If anyone has material possessions and sees his brother in need but has no pity on him, how can the love of God be in him?”
Being a good steward starts with multiplying His blessings, but the fruit is in how we then use these blessings. In my own mind I keep going back to thinking management, not ownership. It is all His. Are we to give a certain amount and consider the rest as ours? I think not. He expects us to use what we need then multiply and return the rest. The blessings of stewardship are in the giving. Knowing when and how to do it is our responsibility.
Having served on a number of Christian boards and being involved in fundraising, I am struck by several things. I have seen sacrificial giving and I have seen large donations, I have seen faith in His provision confirmed and I have seen a few people prime the pump and multiply the impact of their gifts to do great things. I recall what Jesus did in Matthew 17:27 when he told Peter, “. . . go to the lake and throw out your line. Take the first fish you catch.”
We are to be proactive; to work. It is through his gifts of abilities that he provides for the body. Of course the fish contained a “starter” with which to pay a tax.
I also see situations where churches and organizations with relatively affluent members are struggling, where the people do not have the vision or heart for giving. Ron Blue explains in Generous Living that Christians don’t give because they don’t plan, don’t know how, have a limited relationship, have limited vision, or financial or spiritual problems. He goes on in this great little book about “finding contentment through giving” to explain we should give to acknowledge God’s ownership and our trust, not as a reflection of our wealth, but of our relationship with God.
From Ron Blue’s list, the “didn’t know how” phrase really struck me, but as I have studied giving I have come to see the need to help the faithful better understand the dynamic of giving. This article will mostly address the “how to’s,” but along with technique, many of us have to deal with how dependent on material things our lives have become and how much of His goods we consume. We need to answer, “How much is enough?” to be free to give the rest away.
The blessings of stewardship are in the giving. Knowing when and how to do it is our responsibility.
How do we give?
- We give regularly through tithes and periodically through gifts.
- We give to churches, missions, Christian organizations, public charity/institutions, and directly to those in need.
- We are prompted to give by obligation (weekly collection plate), by conviction (for a friend in missions or to para church organizations in which we believe) and by heart (when we see those in greater need than ourselves).
What are the techniques of giving?
Giving, like savings, needs to be regular and it belongs in the budget. Your church and other Christian organizations need to “pay the light bill” with dependable monthly income. This is a good use of the tithe and consistent with 1 Corinthians 16:2 which tells us “On the first day of every week, each one of you should set aside a sum of money in keeping with his income.”
Gifts above the tithe can also go to general funds, but gifts can also be directed to projects for which you have a heart or where you can make a difference. Large gifts are best used for large projects which might never happen with many small gifts.
We should never limit anyone’s heart for giving. I was once asked for suggestions by a friend who wanted to tithe from an inheritance. I provided a list of $5,000 and $10,000 projects and at the last moment felt led to add a major $40,000 project. The friend in turn was led to fund the project for $40,000, and another for $10,000. Wow! I could have limited their vision, but the Lord knew their heart and blessed that situation.
Knowing how is not just a matter of signing a check or opening a wallet. Beyond that, it is a matter of giving so we can maximize both our ability to give and the size of our gifts. There are smart techniques for regular giving and for special estate or “planned” giving.
Regular giving is best accomplished by allotment or bank transfers. It happens and you know it will happen next month and that may help keep the discipline of your budget. Those regular amounts mean a great deal to every ministry I know and when you have extra, you can still make special gifts.
All gifts of cash or equities to IRS-approved charities are tax deductible for those who itemize deductions. These deductible gifts can include your travel and expenses of your volunteer work, on boards and council duties, at places like White Sulphur Springs and Spring Canyon. Deductions are smart for they make better use of His gifts and let us give more.
If your tithe and gifts do not meet the threshold for taking the standard deduction (usually means you don’t have another large deduction like mortgage interest and real estate taxes), you could seek techniques to qualify yourself. If you shift gifts from two years into one, justifying an itemized deduction larger than the standard one year and take the standard on the alternate year, you have been a good steward. You might be able to use this technique if you have partial year ownership of a house that gives you a head start on itemizing.
Giving appreciated property such as stock or mutual funds is a smart gift that the government will subsidize. You paid $4000 for a stock now worth $7000. You give the stock to OCF, which sells it and gives you credit for $7000. You avoid long-term capital gains tax of $600, you get a bigger deduction than selling the stock and gifting the remaining $6400. Since OCF is exempt from capital gains, it is never paid. This technique becomes increasingly valuable as tax brackets rise. Always capitalize on “government subsidies.”
Giving as part of estate planning is an area of huge potential, but most of us do not see the opportunity or need. Many people in Austin Pryor’s “Protecting and Transitioning Phase” have assets well beyond their needs or beyond what is smart to leave to heirs. These people may also face estate taxes of between thirty-seven and fifty-five percent and may become involved in many complex trust and distribution plans to avoid these taxes.
Something many of us will be able to do is to tithe and gift from inheritance we receive. The WWII generation is in the processing of passing on the largest shift in generational wealth in history. They grew up in the Depression, learning frugality and hard work and they are being faithful to the pattern of their lives by taking care of succeeding generations. The Boomer and following generations will receive far more than they need and a tremendous opportunity to gift large sums to special projects. Can you think of any? Pray for guidance on where “your” inheritance should go.
Planning ahead gives them many options. You may gift to charity paid-up insurance you no longer need. You can make large gifts every year, and you can set up trust to transfer assets at times that make sense and garner for you the most in tax deductions and savings. You can contribute to Caesar or the church.
OCF is named the beneficiary of a Charitable Remainder Trust (CRT) named the Joshua Trust. A retired military officer realized that he no longer made good use of a vacation property that had appreciated to $460,000. He placed it in a CRT which sold the property and invested the money. A brokerage trust department will manage it for ten years and then pay the “remainder” to OCF. This family will receive five percent payments ($23,000) (about fifty percent tax free) for ten years and reap just under $300K in tax deductions spread over five years. With reasonable management by the broker, the “remainder” could be a million dollars–all from an after tax “cost” to the donor of about $37K–depending on tax bracket and state. That is good stewardship!!
How many people could do this? Probably enough that the “remainders” paid over random years would provide OCF with annual supplements to allow it to do strategic things. Is this a good use of His blessings? Do we need a new hotel at White Sulphur Springs or to build Veterans Memorial Lodge at Spring Canyon? Will such gifts further His work more than our possession of property we do not need? Many people do not realize that they can “afford” to do such things. The question I am asked most often by people in this phase is, “How much is enough?”
While the answer is individual, many people have much more than enough, especially if they believe He said, “. . . Never will I leave you; never will I forsake you” (Heb. 13:5). Interestingly, the start of verse 5 says, “Keep your lives free from the love of money . . .” Our security rests with the Lord. The answer has something to do with how much we need.
The financial security we want to assure our families is largely dependent on a steady flow of income and insurance for health and to replace lost income. Our retired pay is continued by SBP and SS supplemented with insurance. Most of us do not rely on large assets such as second homes, land holdings, or large stock portfolios. We may have them, but they do not and cannot provide our ultimate security. How much is enough is a matter of heart, but the real question is how much of His property do you need versus what would be better used in His service.
We also give through what is euphemistically called planned giving. Or, “We want your money when you are gone.” You have probably heard from your university and maybe your civilian church with such opportunities. We chuckle or sneer, but it is a very sound concept. Many of us in the latter phase want to educate grandchildren and help the next generation with major purchases or expenses, but many Christians, myself included, believe we shouldn’t leave them large sums of money. There are simply better uses of His blessings.
The many complexities of estate planning are solved if we keep our estate below limits by gifting or by giving to charity through the wills of the “second to die” among couples. At the death of the first to die, there is no estate tax to a spouse, but if you have not established a family trust or gifts to charity, the tax when the second partner dies can be huge. You can give it to the government or determine what works would benefit from your excess blessings. Remember, Jesus said to render to Caesar that which is Caesar’s, but he didn’t suggest that we give more than is demanded.
Dr. Charles Ryrie, who has written articles for Sound Mind Investing, uses 1 Timothy, chapter 6, verse 6 to share his views on money and the love of God. “. . . godliness with contentment is great gain.” It is the basic necessity of Christian life. No matter what else we have it is without foundation without godliness. “I know what it is to be in need, and I know what it is to have plenty. I have learned the secret of being content in any and every situation . . .” (Phil. 4:12). “Content means learning to love the will of God” says Dr. Ryrie, then, he adds, the first great principle for guiding the believer “through the maze of the abundant life” is “In want, content, and in plenty, content.” Dr. Ryrie continues to point out that attitude not money can be evil. God gives us all things to enjoy, but, “the world’s system leaves God out.” He interprets that worldly logic saying, “it is a good deal or it is on sale” does not mean that a purchase is in God’s will. “When prosperity comes…the spiritual Christian will use it to give more (proportionally) not necessarily to buy more.”
Paul continues in 1 Timothy, chapter 6, verses 17-19 with, “Command those who are rich in this present world not to be arrogant nor to put their hope in wealth, which is so uncertain, but to put their hope in God, who richly provides us with everything for our enjoyment. Command them to do good, to be rich in good deeds, to be generous and willing to share. In this way they will lay up treasure for themselves as a firm foundation for the coming age, so that they may take hold of the life that is truly life.”
What more can I say?
About the author: COL Ray Porter, USA (Ret.), is a longtime OCF member and former Council member. He created and taught an elective course on personal finance at the Army War College in the late 1990s—widely regarded as one of the most popular elective courses during his tenure. After retirement from active duty in 1997, he spent several years teaching personal finance and stewardship for churches and military units throughout the U.S. and Germany.
Editor’s note: While some of the specific examples in this series may not be updated according to the latest tax codes or financial data and markets, the principles of stewardship and personal finance still hold true today. The advice and insight in this article alone should not be used to make personal financial and investment decisions. Always consult a financial advisor or accounting professional before making any decisions with regards to your personal finances and investments.