Faith & Finance Fridays
Reflect • Commit • Equip • Apply
Equip: Counting the Cost
“For which one of you, when he wants to build a tower, does not first sit down and calculate the cost, to see if he has enough to complete it?” — Luke 14:28
Over the past two weeks, we've reflected on Jesus' image of a builder. We’ve considered the importance of discipleship and stewardship and how we commit to them as our foundation.
This week, we'll focus on the tools that equip us to put that wisdom into practice.
The builder in Jesus' example doesn't stop after calculating the cost. His planning equips him to begin building because it guides action.
Counting the Cost in Practice
Dreams become easier to pursue when we define what they require. That’s one of the practical lessons behind counting the cost. A builder has to move beyond the idea of a tower and begin thinking in terms of practical realities, like materials, timelines, and resources.
Counting our own costs as we begin planning our financial goals works the same way. We don't need every answer. We simply need to ask questions.
Try This This Week
Last week, we chose a goal and considered why it matters. Now we're going to equip ourselves with three components every goal needs:
- A clear description
- A timeline defined by how soon we could get there, or a deadline
- How much will it cost
Let’s look at these together.
1.What Are We Building?
Instead of "save more," which is vague and has no end goal, be specific with something like: “We want to build our house.” Now, depending on where we are in life and financial development, this could be our first home, one from which we might eventually move on. Or maybe we’re in a position where you can finally build our dream home.
Those distinctions are important and, regardless of which it is, we can give our vision of a house shape by picturing the details:
- How many bedrooms and bathrooms? Can our kids share rooms, or do they each need their own?
- Should we have a yard or a pool? Who will do the yard work? Who will clean the pool?
- What color is our house? Are we building with stones or bricks? Or do we want siding?
- How many stories will it be?
- Do we want to live in a community with an HOA?
Maybe we love the bustle of city life and our dream home is an apartment that we want to buy. In which case:
- Is our apartment in the city where we currently live, or do we want to move?
- Do we want a balcony?
- Does our building need an elevator?
- While we want to be in the city, do we want a busy street, or a quieter side street?
Whatever goal we choose, we need to close our eyes, really see the end result, and write it down. A written vision equips us to count the stones.
2. When Would We Like This to Happen?
We need to attach a timeframe to the goal. Builders (or rather contractors) all have a deadline…and fees for when they don’t complete on time. But setting a timeframe isn’t as simple as marking a date on the calendar. We need to consider:
- Is it defined by resources currently at our disposal?
- Is there an event over which we have no control, such as a move to a new city or the birth of a baby, behind the completion date?
Giving a goal a date helps us connect today's decisions with tomorrow's hopes.
3. Are We Counting the Cost?
We can use this detailed vision to determine how many stones we’ll need to build it by looking into the cost of homes in our target neighborhood. We can also reach out to contractors and ask for an estimate.
We should also decide if we want to save enough for a 20% downpayment before we get started, or have financed from the get-go?
All of this research and the answers to those questions will help us build our budget. Understanding the numbers gives us a clearer picture of what the goal will require.
4. What Is Most Important to You?
None of us have unlimited resources. So, before we lay the cornerstone, we need to be clear on what we’re willing to give up in order to make this goal happen and ensure that we’re still living under our means.
How do we do that? We embrace tradeoffs. We can prioritize the things we want for our house and drop the less vital things from the bottom of the list as costs go up.
Or we can limit ourselves to three things that we absolutely will not give up. Everything else may be negotiable, but not these three. For example: a yard for the kids, space for a home office, and double ovens in the kitchen are our absolute priorities. To keep those, we might be willing to cut out plans for a pool, separate bedrooms for everyone, and marble countertops.
As we recalculate and determine our top priorities, let’s consider two final thoughts.
If some things are important to us but we cannot afford them, can we change our timeline? Or, if time is of the essence, can we change the goal and downsize a little?
Making Tradeoffs to Meet Our Goal
We have counted the cost and now have a well-defined plan, including a list of wants we're willing to negotiate or give up entirely so we can pursue our dream while living below our means. Having a budget in place isn't the finish line. Now we need to consistently set money aside to make that plan a reality.
Many of us save whatever is left over at the end of the month. Building savings works best, though, when it becomes one of the first decisions we make. Even if we don't have a lot of money at the beginning of the month to put into savings, there are often ways to create room for it.
You may have heard me say, "Life is a series of trade-offs. We trade off comfort now to achieve our dreams." What comforts in our budgets can we regularly give up to put aside $100 a month? Even if our budgets are already pretty tight and we can only find $50, we're still further ahead than we were yesterday.
Saving might sometimes be painful, but it’s doesn’t have to be complicated, especially if we have a trusted financial advisor from whom we can seek guidance. An advisor can help identify savings gaps and determine what adjustments may help us move toward the goal. We can feel more confident with our financial decisions and have someone keep us accountable, keeping us focused on our goals.
We can think of a financial advisor much like a coach. Professional athletes don't stop working with coaches once they become successful. In fact, many have several coaches helping them refine different parts of their game. Likewise, as our financial lives become more complex and our goals become more ambitious, a trusted advisor can help us stay disciplined, make thoughtful adjustments, and continue moving toward what matters most.
If we don’t have a financial advisor, maybe we wonder if we can afford a financial advisor, especially if we’re counting pennies towards a big goal. The better question is, can we afford to not have one?
Reflection Question
These might be different questions than the builder in Jesus' example paused to consider before he started building. What demonstrates the same commitment to faithful stewardship is taking the time to ask them. This week, ask yourself: What is one thing you know about your goal today that you didn't know before you sat down and counted the cost?
Next Friday, we'll look at how we can apply the lessons with which we’ve equipped ourselves.