How Wealth Creators Think

God has created the whole world for increase. He placed the power within every living creature to reproduce beyond themselves. God gives humans the special ability not only to reproduce other humans but to bring forth an increase of useable beneficial resources from the earth– what we call wealth.

God tells his people not to forget him when they grow wealthy because he has given them the power to “bring forth” wealth.

Deuteronomy 8:18 “And you shall remember the Lord your God, for it is He who gives you power to get (Hebrew: bring forth) wealth, that He may establish His covenant which He swore to your fathers, as it is this day.

History has shown us that humanity has power to use their energy and ingenuity to create usable, beneficial resources. Every generation has their Steve Jobs, Bill Gates and Warren Buffets. Although we may never command the amount of assets these moguls have, we can all find how God has gifted us to produce wealth.

We live in perilous times. This fallen world cries out with deep needs. Producing wealth helps alleviate those needs. The earth was created to produce enough to feed, clothe and house the entire population. Sin steals, kills and destroys. God’s people must now show the way to produce more than we consume. Sadly, the church has stopped equipping God’s people to produce and many are mired in financial bondage. They have either moved into unbiblical ideas that treat God like a genie in a bottle or stop short at living debt free, on a budget and make sure you tithe!

Wealth is a product of thinking and working. Wealth is created when we apply our effort and ingenuity to the earth’s God-given resources to create usable desirable goods and services. Because wealth is first created in the mind, it can be our thinking that hinders our ability to create wealth. The wealthy think differently about money and wealth creation than the average person.

How Wealth Creators Think

They deal constructively with risk and failure. The wealthy don’t take foolish risks, but they realize that risk is a part of life. All of them have failed multiple times, in fact, the average successful business person has had four failures before they had a success. Failure is a normal part of learning. Failure isn’t fatal, it’s feedback!  But like billionaire Mark Cuban said, “You only have to be right once.” Start by taking small risks through investing. There are four investment soils you can plant your seeds in: real estate, financials, business ownership and education. Each have their own risks and potential rewards.

A savings account is NOT an investment. A savings account may earn you .3% interest. Inflation takes 2-3% each year. The money you have in a savings account is there if you need the money quickly. It’s great for an emergency fund or short-term needs. Any money stored there beyond that, inflation slowly erodes away. Money in a savings account helps you grow poorer safely. Investing puts your money to work for you. Don’t tolerate lazy dollars. Most people start investing with a 401k or IRA. Make sure you take advantage of these opportunities.

Think Leverage

High capacity wealth creators don’t think like an hourly wage earners. Most of us work for money. The wealthy use their creativity and their time to learn about ways to leverage each dollar through investing. Instead of using their time after work to watch endless episodes of prime-time TV and memorizing sports stats, they spend time learning how to leverage what they have earned. Many of them started simply by spending less than they earn and investing the rest. They don’t just assess the price of goods but they look at the total cost of buying an item; which includes the important concept of opportunity cost. What could my money have earned had I taken the opportunity to invest it instead of buying that new car? What new skills can I add to serve people better and increase my utility to others?

They see problems as opportunities

They use their creative energy to solve them and monetize their solutions. Wilmot Hastings, was so agitated by the $40 late fee he received by turning in his copy of Apollo 13 a few days late, that he thought, “There must be a better way.” On his way to the gym, he thought of the Netflix model. One of the key ways to create wealth is to solve problems, the harder problems you solve, the more money you make (provided there’s a demand for the solution, you could repair cassette tape players, it may be difficult, but very few people need that solution). If you can’t solve hard problems, find a way to solve easy problems (like changing a tire) for many people.

For 27 powerful lessons detailing the personal characteristics, three wealth creation methods and the investment classes of business ownership, financials and real estate, pick up your Christian’s Guide to Wealth Creation here: http://wealthcreation.careywaldie.com/

Economic Education Gap

As we enter the graduation season, full of hope and promise I find myself asking, why don’t we teach the most powerful engine of economic prosperity? Our children face a large economic education gap. Our school systems do not educate for entrepreneurial leadership any more.

God created us to steward the earth and its resources. He created us with the capacity to create, produce, cultivate and domesticate. He also works through us to bring about the knowledge of him around the world. God desires his “kingdom to come on earth as it is in heaven.” With all this in mind, prosperous societies are somewhat of a recent novelty. Not until around 1800 did individual prosperity emerge in a few countries in northwestern Europe. Even today, more than 2 billion people in the world live on less than $2.00 a day.

America has been a leading power in economic growth for nearly two hundred years. Even with a quarter of the population of China and India, the United States continues to have the largest economy in the world.

What Makes a Culture Prosperous?

Economic activity rests on the foundation of political, legal and cultural conditions within a society. The societies that are most economically free, prosper the most. Economic freedom can be measure using key cultural indicators like private property rights, just justice systems, public infrastructure, low corruption in government, low government red tape, strong family structures and future orientation toward time. America is now ranked seventeenth in the world in economic freedom with Hong Kong and Singapore vying for the top spots. (See http://www.heritage.org/index/)

The Most Powerful Engine of Economic Prosperity

There are different paths to personal prosperity but the most powerful engine of economic growth has always been entrepreneurial activity. We can define this as: Initiating economic activity through ingenuity, effort and risk, with the goal of achieving profit. If a nation wants to raise its standard of living, the best thing it can to is encourage entrepreneurship.

Knowing this, we should implement a scholastic initiative to educate our population on the rules, benefits and opportunities of entrepreneurial leadership. We should start teaching accounting principles and terms, legal structures and the basics of investment opportunities. This should be required learning. We teach students to find “x” in compulsory algebra, but they can’t fund an IRA or start their own business. If this is indeed the land of opportunity, we should equip our students how to take advantage of the opportunities.

Education Gap

Often when I’m in a store, I’ll ask an attendant where I go to buy stock. They look at me like I have three heads. I say, “Stock in your company, do I get it at the information desk?” Over 90% of people I talk to have no clue where to buy stock in their own company. They have never been taught how to play in that sandbox. Their ignorance imprisons them.

Lifeworks

Five years ago, we started a summer program for junior high students called Life-Works. https://www.facebook.com/lifeworksboys/ This program helps train students through eight-hour days, five days a week in the fine art of work and entrepreneurial enterprises. We take students from impoverished backgrounds and try to give them the tools to provide for their families and the vision God gives them.  One of the books we use is called The Accounting Game that uses the template of a lemonade stand to help learn the basics of bookkeeping. We also teach, the four levels of workers and how work is worship unto God.

They earn currency they can spent at auctions that we hold throughout the summer. They can invest their money instead of spending it to have more for the next auction teaching them delayed gratification. We have now watched as students have grown and entered the workforce in food service, the military and as carpenters. Some have even started their own business.

Take the time to invest in your knowledge and help the next generation know that they can participate in entrepreneurial activity in many ways. To help you learn, we have put together a fantastic resource called, The Christian’s Guide to Wealth Creation. You can learn more here: http://wealthcreation.careywaldie.com/

 

 

How Much is Too Much?

One of the hardest questions to answer for those who desire to create wealth is, “How much is too much?” If one is creating wealth to produce for the kingdom, how many of the seeds that you generate should you keep and how many should you give away? While this is a personal question that we all need to answer, I can give you some questions and insights that will help guide your decision.

What is the vision God has given you?

If you don’t have a family or personal vision, you will more easily struggle with restraint. If you don’t have a target to shoot for, any target will do. Filter each large purchase through the question, “Will this purchase bring you closer to vision fulfilment or further away? Are you making the correct trade-offs to achieve your vision?

Have you dealt with the hedonic treadmill?

The hedonic treadmill is a principle that states, once your basic needs are met, people quickly and easily take what they have for granted and compare what they possess to each other. People then begin to calculate their happiness as a function of relative income instead of absolute income. We call this keeping up with the Jones’.

An article in the Atlantic pointed out that the more people make the less they give as a percentage of their overall wealth. Ken Stern writes, “One of the most surprising, and perhaps confounding, facts of charity in America is that the people who can least afford to give are the ones who donate the greatest percentage of their income. In 2011, the wealthiest Americans—those with earnings in the top 20 percent—contributed on average 1.3 percent of their income to charity. By comparison, Americans at the base of the income pyramid—those in the bottom 20 percent—donated 3.2 percent of their income.”[1]

Further research pointed to the principle of proximity. The wealthy have the means to isolate themselves from those in need. While those in the middle and lower classes see needs on a regular basis. If you want to avoid the hedonic treadmill, you must not isolate yourself from the needs in our world. Make a point to create systems that keep your favorite charities and opportunities in front of you.

Are you tithing?

The tithe is a great starting point to help you maintain consistency in your giving. It’s so easy to give less as you make more. We can have a running catalog of things we want as our income increases. But if you make a habit of tithing, you create a great foundation of obedience to build your generosity upon.

A friend of mine was making around $800 per paycheck. He would faithfully tithe his $80. He started his own business and began making much more money. His tithe checks grew correspondingly. He struggled to tithe each week as he noticed, “That’s a lot of money!” One day he felt a gentle nudge in his heart that said, “Would you like to go back to tithing $80?” He gladly wrote the check!

Keep eternity in mind.

Remember, we will all give an account to how we stewarded our money and possessions. Jesus reminded us to store our treasure in heaven and to whom much is given, much is required. If you keep forever in front of you, this perspective will help guide your spending and giving decisions.

Set an income level that you will live on.

Above that, give it away. How much is enough for you? Without this line, it’s easy to have spending creep. How much is enough? Just a little more. You can also set a percentage giving goal. I would like to get to the place where our family gives away 50% of what we bring in. Rick Warren, during an interview with Larry King, was asked about his giving patterns. Mr. Warren had reached a place where he was giving 90% away and living on 10%. He earned most of this from the proceeds of his best-selling book, The Purpose Driven Life. Larry King asked, “Is it true you live on 10% of your income? How can you do that?” “It was a good book!” Rick replied!

Working through these questions and creating your spending boundaries before your next raise will prepare you for that moment and guard you against the hedonic treadmill and spending creep!

Brand New Resource

We just released our brand new resource designed to help you create more provision for God’s vision for your life. There are 27 powerful audio lessons and an 100 page e-book with all the notes plus incredible bonus resources to help you create wealth. To take the tour click here: http://wealthcreation.careywaldie.com/

[1] https://www.theatlantic.com/magazine/archive/2013/04/why-the-rich-dont-give/309254/

Are You Winning? Practical Advice for Winning at Life

David was looking to me for guidance regarding direction for his life. He had struggled with what path to take for career and personal success. We talked about time management, personal discipline and learning from other successful people. Finally, I just asked, “Why does God have you on the planet? I continued, “You are here at God’s behest, for his purposes, what are those?” David, paused and said, “I’m not so sure of that.” “I see people prospering and successful that don’t know God.”

When pursuing success, (not a bad goal in and of itself) one must first define your win. What is success? Perhaps a bigger question is who determines success? Is it us? When learning to play a game one must first decide how the score is kept.

David is living his life like so many others. They fail to consider how the ultimate scorekeeper keeps life’s scores. God keeps the time and the score. He is the final judge and rewarder. He hands out the trophies. Many wealthy people look at their bank accounts as scorecards. Yet God keeps score differently, and it’s his card that matters.

He looked at a widow’s pennies and proclaimed them more than the big dollars that were put in the offering. He told a man that life doesn’t consist of material possessions. Jesus counseled people to store their treasure in heaven.

Far too many people are living like they are captain of their destiny, but they exist because God wants them here. God created you for him. If you gained the whole world and lost your soul, you made a bad trade. You may have “won” for eighty years but you lost for eighty billion.

Three Questions

I coach people to ask three questions for clues to why they exist. 1. Where do they feel God’s pleasure? In what activities do you experience endurance with joy? A friend of mine loves tax law. If you ask him a question about taxes he lights up like a Christmas tree and could go on for hours. He feels God’s pleasure when he surrounds himself with the IRS’s legal code. This is a clue. God wired us with certain gifts and passions.

Question 2: Where do you feel God’s partnership? The Holy Spirit is a helper. God anoints us to use our gifts for his glory. The first mention of anointing wasn’t for a preacher but artists and carpenters.

Then Moses told the people of Israel, “The Lord has specifically chosen Bezalel son of Uri, grandson of Hur, of the tribe of Judah.  The Lord has filled Bezalel with the Spirit of God, giving him great wisdom, ability, and expertise in all kinds of crafts.  He is a master craftsman, expert in working with gold, silver, and bronze.  He is skilled in engraving and mounting gemstones and in carving wood. He is a master at every craft.  And the Lord has given both him and Oholiab son of Ahisamach, of the tribe of Dan, the ability to teach their skills to others.  The Lord has given them special skills as engravers, designers, embroiderers in blue, purple, and scarlet thread on fine linen cloth, and weavers. They excel as craftsmen and as designers. (Exodus 35:30-35)

Where do you find yourself excelling beyond your peers?

Discipline and Anointing

God may have given you a gift and He may have anointed you to accomplish great things, but anointing does not replace discipline, it only comes along side of it. The Holy Spirit is a helper, you are the doer.  It is the process that brings the prize. The road to greatness is paved with the asphalt of the ordinary. Your capacity for greatness will be measured by your ability to handle repetition while maintaining mental focus. Talent is no substitute for consistency.

God may have given you a gift and He may have anointed you to accomplish great things, but anointing does not replace discipline, it only comes along side of it. The Holy Spirit is a helper, you are the doer.

Johann Sebastian Bach was arguably the greatest worship leader to ever live. He worked tirelessly and demanded equal commitment from those he worked with. Few people matched his industry. At the end of his career, his works filled sixty huge volumes.  When asked the secret of his genius, he answered simply, “I was made to work; if you are equally industrious you will be equally successful.”

What About God’s Dreams?

Question 3: Where do you feel God’s passion? God’s heart beats for three things, the lost to hear the gospel, the Christians to grow to maturity and his kingdom to show up on earth as it is in heaven. These are God’s dreams. We are here to make God’s dreams come true. Don’t expect his guidance for your dreams if they have nothing to do with his dreams.

If you find yourself using your gifts and talents for his glory, you cannot lose in life, no matter how the culture keeps score, God keeps the one that matters.

For more on finding your place in God’s story see the Christian’s Guide to Wealth Creation where we devote multiple lessons to personal success in a way that will matter forever! www.wealthcreation.careywaldie.com

 

 

The One Lesson from High School Econ That Actually Matters to Your Income

I don’t remember much about my economics class in High School. I do remember my teacher, Mr. Carstensen, we locked him in a closet. I liked economics (still do), but I’m not a fan how we teach it to our students. We don’t teach them the rules of the financial sandbox. We don’t teach the most proven methods of escaping poverty–entrepreneurial activity. Most of our high-school graduates have no idea how to participate fully in the economy. Many work hard but struggle with low income and grope in the dark searching for the rules of the game.

Some people are great budgeters. They clip coupons, they pay their bills but they cannot get ahead. They give all they can, but they still struggle financially. There are many factors to a person’s wage but one needs to start with that most valuable of lessons in economics class (the one most people slept through): supply and demand.

Increasing Income

If you’re not making enough money you only have a couple of options. First, you can learn to solve harder, more in-demand problems. The harder the problem, the more people get paid to solve it. The harder the problem, the fewer the people who can solve it thus the increased demand.

Or, if you’re not a brilliant super genius, you can learn to solve easier problems for more people. Leverage your talents by creating systems (usually business systems) to serve more people. McDonalds doesn’t make the best burger, but they have the best systems. They solve an easy problem—making a hamburger—for billions of people (not an easy problem). It’s their systems of production, logistics and training that make the difference for them. Unfortunately, many students will graduate this year with degrees that did not prepare them to solve in-demand problems. Many will carry crushing loads of student debt into their future.

According to Forbes magazine, employers are now seeking graduates with degrees in, economics, electrical engineering, logistics/supply chain management, information sciences and systems, management information systems, mechanical engineering, computer sciences, business administration, accounting and finance. If God has wired you for any of these areas, money spent on this kind of education will tend to pay you higher wages.

College May not be for Everyone

However, learning a trade may be a quicker route to financial freedom. If you can leverage that trade into your own business, you can leverage the talent of other people to help your vision flourish. Or, you can invest that surplus into financial investments or some real estate. Don’t eat all your seeds every month, save some to plant into good investing soil.

A friend of mine works at Walmart. He has a high-school diploma and has more in his 401k than the vast majority of Americans. He lives beneath his means, invests in smart mutual funds and employs all those dollars each day. They work for him and have returned a handsome profit.

The quickest way to making more money is not to lobby congress for a higher minimum wage. It is to take ownership of the kinds of problems you can solve and increase the amount of value you bring to every transaction.

The More you Learn the More You Earn

Motivated people can learn almost any skill today. The internet has opened the doors to learning like never before. You can even learn chemistry, computer programming, artificial intelligence, micro-economics from MIT free! https://ocw.mit.edu/courses/most-visited-courses/

Cindy worked in an office as a secretary for a number of years at a local car dealership. In her spare time, she taught herself to code websites. When the dealership needed someone to help with their website, Cindy was ready. Her boss told me if he had to start laying off people, she would be the last to go. She made herself so valuable to the company. Never stop learning. The job you have today, may be replaced by a robot or kiosk tomorrow. Skate to where the puck is going, not where it’s at.

I created the Christians Guide to Wealth Creation to help people grow their salaries. It contains 27 lessons, all focused on increasing your income. We address all four facets of generating wealth—culture conditions, personal characteristics, the three wealth creation methods and the world of investing. The first investment you should make is in yourself.
To learn more about the Christians Guide to Wealth Creation, click here: www.wealthcreation.careywaldie.com

Prospering? Time Will Tell; Literally

In studying economic prosperity, researchers have found there are certain cultural and personal characteristics that can either hinder economic freedom or foster it. One of the little discussed qualities is a future orientation toward time. How a person or a culture views themselves in relation toward time will often determine how well economically they will fare.

People and cultures that live for the moment will not invest or pass on wealth generationally. Without investment, wealth cannot compound. All the seeds are eaten with none planted for the future beyond today. I know this attitude well. It marks my younger years. I ate all my seeds every summer and had none for college or investing. I had to go into debt for school and lost a decade of compounding for my future investments.

The prospect of resisting short run temptations for the long run gains has been the subject of a few studies. One of the experiments started with four-year-old children at Stanford University’s pre-school.

Researchers took each child into a room and gave to them one marshmallow. They told each child, “You can eat this marshmallow as soon as you want, but if you wait and don’t eat it until I return in a little while, then I will give you a second marshmallow.” When the researcher left, they observed the children through a one-way window. Several of the children ate their marshmallows immediately, others tried to resist temptation but soon devoured theirs as well. Others stayed determined to wait, and soon received a second marshmallow.

The result of each child’s experiment was recorded, and then researchers followed their academic performance through their later school years. Those children who had saved their first marshmallow until they received the second were later found to be, according to researchers, better adapted and more popular, and they exhibited more confidence and responsibility than those children who could not delay gratification. Also, those who had resisted temptation scored an average of 20 to 25 percent higher on the Scholastic Aptitude Test (SAT), the test most widely used by colleges and universities to help predict academic success. The inability to delay your gratification will cost you in two realms: financial and relational.

Those who have a future orientation toward time don’t just assess the price of goods but they look at the total cost of buying an item; which includes the important concept of opportunity cost.

Think of every dollar you spend as an investment. What you buy with that dollar can go up in value or down.  The moment you buy a stereo or a video game system, clothes or a pair of shoes, you start losing money because you can never sell the used item for the price you paid for it. That’s called depreciation. That’s bad.

But wait, it gets worse! When an item depreciates, you not only lose money in the value of the thing, you also lose the money you would have gained had you invested it instead of spent it. That’s called opportunity cost. You lost an opportunity to plant your seeds for a future harvest.

Why don’t people make better decisions? Why don’t we have the discipline to delay our gratification? “The costs of what we do are incurred in the near term while the rewards are realized only in the distant future. The pain of self-denial is immediate; the gain in the form of a larger net-worth and higher income at retirement is way off in the future.”[1]

Assuming you invested the extra in a high-quality stock mutual fund like you could through Fidelity or Vanguard or even in your own small business or a form of real estate that could net you a 10% return.

  • If a smoker quit smoking and invested the amount they spent on cigarettes, over 15 years they would have nearly $76,000. After 30 years, they could have $390,924 and two pink lungs!
  • If you bought an $8,000 used car as opposed to a $15,000 one and you invested the difference over 15 years you could earn nearly $26,000 and $122,000 in 30 years. New cars depreciate 20-25% the instant you drive them off the lot. In two years, they depreciate 35-45% depending on the make and model.

When looking to build wealth, don’t eat all your seeds, plant some in good investment soil. You will never regret trading less now for more later.  The Christian’s Guide to Wealth Creation is designed to help you understand the rules of the financial sandbox. We build bridges of knowledge with 27 downloadable, audio lessons and corresponding 100 page e-book that includes everything you need to begin learning about investing in all three investment classes. Click here for more information.  www.Wealthcreation.careywaldie.com

 

[1] Getting Rich in America, 53

Playing the God “Equality” Card

Playing the God card.

All through the Scriptures, God places special value in helping the poor. Jesus came to preach good news to the poor. When we give to the poor we are “lending to the Lord.” (Proverbs 19:17) James decries those who have defrauded the workers by keeping back their wages. (James 5:4)

When discussing income inequality, people are fond of playing the God card. “God wants us all equal,” they would shout!  “God hates inequality.” the Reverend Jim Wallace proclaimed on the floor of the Senate after a minimum wage vote.

But does God hate inequality? Or are there other issues of greater importance? Often Christians will use Acts 4:32 to substantiate a belief in a command economy (socialist/communist).  Speaking of the early church It says, “All the believers were one in heart and mind. No one claimed that any of their possessions was their own, but they shared everything they had.” But does this verse really point to the church favoring communism? After all, they had all things in common.

They say never to read a single Bible verse but to always read the context. The next verses give us the rest of the story. “There were no needy ones among them, because those who owned lands or houses would sell their property, bring the proceeds from the sales, and lay them at the apostles’ feet for distribution to anyone as he had need.” (Acts 4:34-35)

These passages do not support a command economy. They point to a group of people living in relationship to one another under a shared vision. No government official took their property and redistributed it. The individuals owned property, the means of producing wealth, and they willingly shared it. What these passages really affirm is wealth creation, community, and generosity as a means for helping others.

Even the ten commandments affirm private property rights. “Do not steal” and “Do not covet,” both assume a right to private property, not property collectively owned by the state.

Other passages point to the fact that God really doesn’t demand economic equality but rather he rewards those who make the most of what they are given. He prizes uniqueness over sameness. The parable of the talents and the minas (Matthew 25, Luke 19) describe the master giving unequal resources and rewarding different levels of productivity.  When he disciplined the lazy workers, he took away their resources and gave it to the productive ones.

Matthew 20 describes the master recruiting different workers at different times of the day. Those who worked part of the day received the same as those who worked a full day. Naturally those who worked the full day spoke up about this “injustice.” The master called them on their envy and pointed out that he paid them what they had agreed to and he had a right to do with his money what he wanted.

While these parables aren’t necessarily trying to teach economics, we can, however, learn from secondary principles regarding our issue of income inequality. The master represents God, and God doesn’t seem too concerned about it.

Jay Richards, in his book, Money, Greed and God, writes, “Instead of being pleased for receiving what they were promised, the early risers envy the others for what they have received. We all tend to do that—to link inequality of outcome or opportunity with injustice. But they are not the same thing.”[1]

What can we take away from what the Scriptures say? First, the Bible doesn’t endorse socialistic, command economies. It endorses wealth creation, community, and generosity for helping others. Second, God grades on both a straight scale and a curve. In other words, we all share equal value and equal indebtedness to a holy, infinite God. Jesus came to establish our value and pay our debt of sin through his redemptive acts on the cross and the empty tomb. The ground is level at the foot of the cross.

But with regards to productivity, God didn’t give us equal talent or opportunity. He grades us on what we have and what we can do with it for his glory. To whom much is given, much is required. (Luke 12:48) For God, it seems, inequality isn’t the problem, injustice, poor stewardship, and absolute poverty are. We should focus on those issues and not chase illusory goals of economic equality.

[1] Jay Richards, Money, Greed and God, 107

Trust me, I’m lying. Christmas and Fake News.

 Fake news is in the news this year. It’s being blamed for the Trump election and the general dumbing down of our populous. But fake news isn’t new.

 Not long after the birth of Christ, the Magi came to Herod’s palace just outside of Bethlehem to inquire as to the whereabouts of the newborn king.

 Herod, attempted to assassinate the Christ-child through an act of subterfuge and deception. He claimed he wanted to “worship” him as well. Joseph was warned in a dream and fled to Egypt fulfilling a long-standing prophecy about the Messiah.

Continue reading “Trust me, I’m lying. Christmas and Fake News.”