Biblical Stewardship, Biblical Money Truths, Biblical Finances Truths, Managing God's Money

Affordability Index

In December 1985

We developed the Affordability Index to help folks decide, based on preset conditions, if they can afford major outlays. Essentially, we define affordability as the ability to buy consumer items without going into debt, and without compromising prior needed commitments. This procedure does not replace dependence on God. Rather, it's meant to help you clarify wants from needs so you might focus your prayers. Let Jesus be your final decision maker! The Affordability Index quantifies contemplated spending decisions based on our PLANE Spending Analysis, that asks these five questions:

Did I Plan this expenditure and did I include it in my budget?
Will the expenditure increase my Loans?
Are there realistic Alternatives to achieve my spending objective?
Is the expenditure Necessary to achieve my spending objective?
Is this the most Effective use of resources now, relative to my life goals and budget goals?

The Affordability Index has two preconditions. First, define precisely the spending objective. Why am I spending? For example, you might wish to change your car; but that's not a good spending objective! The real issue is this: What are my current and medium term transport needs? This is a different question which could produce a different answer. Think about this carefully because poor spending objectives definitions' normally lead to excessive spending based chiefly on clever, seductive advertising!

The second precondition is to ensure the proposed spending conforms to the GAS Principle as outlined on our home page. If it does, answer the PLANE questions based on a proper definition of your spending objective. After, fill in the Affordability Index interactive form below for the item you believe fits the objective. Decide to apply the Affordability Index to all spending on individual items greater than a predetermined amount. Husbands and wives should use it together. When you use the Affordability Index, always review Matthew 6:24-31. Recall Jesus' promise to supply our needs!

For more information on both the Affordability Index and the PLANE Spending Analysis refer to The New Managing God's Money-The Basics pages 225 to 237. There you will see suggestions to evaluate two exceptions; a car for work, and a special one-off item called a "vase". We would appreciate your comments.

What am I buying? What's my objective?
Why am I buying this? (Don't assume you need an item being replaced. Re-justify it! Define the need generically: You don't need a car, you need transport, which the public system could supply!)
"PLANE" Questions	Score	Comments
Plan		If you did not set aside funds for this, select "Not Budgeted".
Loans		If you plan to pay by credit card, select "Unchanged" only if you have reserved the cash to pay the balance in full.
Alternatives		Is there an alternative to do the same objective? Not an alternative objective, but an alternative for this objective. This Index assumes you have identified the need to do the objective. It's merely helping to decide if you can afford to carry out this need.
Necessary		Necessary for the stated objective.
Effective		Is this the most effective use of God's resources now? Seek to know God's will for you in this decision. Even if you scored "0" for each item above consider this: If you used these funds now, would it prevent you from doing a different objective?
Total Score
Scoring System: If the total of the five selected items is less than 6, you can afford this item. If the total of the five selected items is "6" or greater, you cannot afford this. But, this is merely an initial guide, go to God and let Him guide you.