“I want to be more generous, but I just can’t. There is no room in my finances.”
At some point, many of us have had this thought. In our hearts, we long to be generous toward others. We desire to use our money to make a difference in the lives of those in our community and around the world. We want to be a conduit of generosity, giving because God has given to us.
But we feel stuck, unable to move forward in our generosity. We find ourselves envying those who seem able to give without hindrance. They seem to have something that you are missing, and it is not a higher paycheck. They seem to have margin.
What is margin? In our personal finances, margin is space. It is breathing room. It is money that is not committed to bills or debt. There is freedom in the margin, freedom to generously respond to the needs around us.
So where does margin come from? Margin does not magically appear. It does not happen on accident. Margin is intentional. I have yet to meet an accidentally generous person. Those who are free to give are usually very intentional about their generosity. And they are focused on creating margin.
Do you desire margin in your finances? Here are four suggestions to get you started:
Get a plan.
You will be amazed at how much money you can waste without a plan. A budget is just a plan for your money. Consider crafting a monthly budget for your finances. Here are a few basic steps to get you started:
- Determine your financial goals, including your generosity. You need to know where you are going.
- Then, figure out your monthly income.
- Next, determine your monthly expenses.
- Finally, adjust your expenses to fit your income.
Track your spending during the month to ensure you stay on track (this app from brightpeak can help). Find ways to reduce expenses to increase margin and generosity. Craft a budget. If the word “budget” scares you, just call it a plan.
Stop keeping up with the Gateses.
You’ve probably heard the term “keeping up with the Joneses.” It simply means keeping up with the lifestyle of those around you. It is a never-ending comparison game that starts and ends with discontent. Unfortunately, we sometimes find ourselves, not just trying to keep up with our neighbors’ and coworkers’ lifestyles, but those whose wealth far surpasses our own. We have moved from keeping up with the Joneses to keeping up with the Gateses. We try to keep pace, an impossible feat. And the results is a bunch of maxed-out credit cards, regretful purchases, and a lack of margin.
Instead of keeping up with the Gateses, focus on increasing your margin and your generosity, a place where you will find longer-lasting contentment. While we frequently regret past purchases, we rarely regret past generosity.
Debt is a generosity killer. Your debt probably includes a few credit cards, a car loan, and a handful of student loans. And you probably have very little financial breathing room. Debt payments squeeze the life out of budgets.
Do not let your debt linger. One well-known debt elimination method is called The Snowball Method. Here is how it works—target your smallest debt first, followed by the next smallest, until all of your debts have been paid. Of course, keep making the minimum payment on existing debts as you go through the method. As you pay off each debt, you will be able to put more and more toward the next debt. Check out brightpeak’s Debt Payoff tool for other debt elimination methods and the resources to help you with the payoff.
This one probably surprises you. But consider this—what happens to your margin if you get hit with an unforeseen financial emergency? What happens if your tire goes flat? What happens if the dishwasher stops washing? Well, if you saved some money, you use your savings to cover the expenses. You don’t swipe a credit card and accumulate more debt, the generosity killer.
You see, we save to give. We save to protect our ability to be generous, and we save to prevent additional debt. Once you become debt free, try to save three to six months’ worth of living expenses. Saving is critical to increasing and maintaining margin.
Margin. Space. Breathing room. Freedom. Many of us are desperate for this in our finances. We don’t want a credit card bill to come between us and our ability to give like we desire. Create margin so that you can give according to what God has given you.
Art Rainer is the author of The Marriage Challenge, The Money Challenge and the forthcoming kids series The Secret Slide Money Club. He also hosts a growing podcast called The Money Challenge.