Christian Financial Planning

 


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Christian Financial Planning: Overview


pencil_greenreducedThis Christian financial planning tool will help the person new to financial planning, and the experienced financial planner, write a simple financial plan from a Christian viwpoint. This Christian financial planning tool includes forms to calculate material worth statements (balance sheets) and income statement (cash flow statement), yearly for five years. We pray you find it helpful.

There is a strong link between a financial plan, daily lifestyle choices, and your walk with the Lord. With the right attitude, a financial plan built on a Christian foundation could help to lower debt, save regularly for children's education, and save to pay cash for a car, and other items.

A Christian financial plan captures probable financial results from planned lifestyle choices focused on Jesu. This Christian financial planning tool shows in different forms, your likely financial picture from doing goals and plans during a specific future period.

You might hesitate to write your financial plan, but I assure you that you can write a simple, basic plan using information on this site. Still, if you choose to get help, consult an independent financial adviser.

If you sense the Lord telling you to write a Christian financial plan, ask Him to guide you through the process. Chapter 19 of The New Managing God's Money-The Basics provides more information on writing a biblically-based financial plan, and shows a step-by-step guide to developing a plan for a fictitious family.

Use the forms below to assist you on this journey that starts with your goals and plans.

Christian Financial Planning: Goals & Plans Definitions


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A goal is the destination, answering these questions: "What am I trying to do?" or "Where am I trying to go?" Goals must be clear, complete, concise, and measurable.

Plans describe steps needed to do each goal. They answer the question, "how"? "Spending plans" that you show in the expenses section below, answer questions: "how much" and "when?"

As you start this journey, describe each goal you sense you should be working on, its sub parts, and show when you will finish each. After, write accompanying plans (the plan box is expandable) as a precursor to working through the worksheets.

Christian Financial Planning: Guidelines to Completing Worksheets


General Guidelines to Enter, Save & Restore Data


You need to decide assumptions that might apply to your circumstance. We added this section as a reminder to help you think about what might happen in the coming years. Assumption headings that we list below might be irrelevant to you. Before rushing ahead, think about those that might apply to you.

Worksheets do not use your assumptions in calculations, they merely add figures you enter; they are not meant to be spreadsheets that calculate inputs.

By clicking the "Save" and "Restore" buttons below, you can save fully or partially completed forms and then restore them for future use. To restore your work, click the "Restore Saved Work" button and choose the file with extension ".mgm" that's saved on your computer. You cannot restore your work by clicking directly on the ".mgm" file. We do not have access to your information, that's why it is stored on your computer."

To move from one input field (box) to another, either use the tab key, or place the cursor in the field in which you wish to enter the amount. You will get an error message if you press "enter" after each entry.

Specific Guidelines for the Material Worth Statement (Balance Sheet)


coin_stackreduced Except for your house, show assets (stuff you own) at prices someone is likely to pay for them--market prices. For your house, show it at the lower of cost or market.

When you enter asset figures, notice "Assets (Total)" equals "Other Assets" in the "How You Financed Assets" section below. If you enter 250 for a house, you will see 250 for "(Assets) Total" and for "Other Assets."

When you finish entering all assets and go to the "How You Financed Assets" section, each figure you enter there shows up in " Liabilities & Equity (Total)," and reduces "Other Assets," correspondingly. If you enter more "Loans and Equity" than "Total Assets," "Other Assets" will show negative. This means, either Liabilities & Equities are too much, or you need to add more assets. So, if "Assets Total" shows 10000, and you enter 8000 for mortgage, you will see 2000 under "Other Assets." And if you enter 12000 under mortgage, you will see -2000.

When you are finished, "Assets Total" should equal "Liabilities & Equities (Total)" with "Other Assets" showing zero.


Detailed Goals, Plans & Assumptions



Goals Description Target Date of Completion
   
Plans  
 
 
Assumptions
(This reminder list isn't exhaustive. Some items might not apply to you; use items that could be relevant to your circumstance)
Salary at Start $'000
Savings at End $'000
General inflation
(This could apply to items like groceries. You decide how costs might rise in the period)
%
Average Borrowing Costs
(If in debt, check your loans to see interest rates. This is a reminder to add interest cost on outstanding debts)
%
Tax Rate
(This might not be relevant. It's here to remind you to provide for tax payment on savings, investments and business income)
%

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Material Worth Statement (Balance Sheet)



Assets (what you own) Year 1 Year 2 Year 3 Year 4 Year 5

House

Car
Savings
Assets (Total)
AT1
AT2
AT3
AT4
AT5
           
How You Financed Assets Year 1 Year 2 Year 3 Year 4 Year 5
Mortgage
Car Loan
Your Equity
Other Assets
(When finished, if not zero, recheck inputs)
A91
A92
A93
A94
A95
Liabilities & Equity (Total)
LT1
LT2
LT3
LT4
LT5
           
Funds available To Spend Year 1 Year 2 Year 3 Year 4 Year 5
Gross Salary
Other Income
(Subtotal: Gross Income)
IT1
IT2
IT3
IT4
IT5
Less: "Giving"
Less: Taxes
Less: Capital Fund
Sub Total: Giving, Taxes, Capital Fund:
OT1
OT2
OT3
OT4
OT5
Net Income: Available to Spend
NNT1
NNT2
NNT3
NNT4
NNT5
           

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Projected Cash Outflow Statement



Projected Spending Plan $000 Year 1 Year 2 Year 3 Year 4 Year 5
Food
Mortgage Payments or Rent
Other Housing Costs
Clothing
Car Loan
Transport (Excl. Car Loan)
Entertainment
Other Expenses
(Minimize this category)
Contingency
(This amount is for surprizes. It shouldn't be more than 5% of the total; less as you gain experience.)
Spending (Total)
ET1
ET2
ET3
ET4
ET5
           
  Year 1 Year 2 Year 3 Year 4 Year 5
Net
NT1
NT2
NT3
NT4
NT5
Cumulative
CT1
CT2
CT3
CT4
CT5
 
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