The economic crisis has given people the opportunity to reposition themselves for a new wave of prosperity. We should prepare ourselves for a new season of economic growth. Here are eight principles for strategic investing:
1. Have a Plan
Write a clear, concise plan of action for your money. Give your money an assignment. Money is nothing more than the ability to make exchange. You worked hard to have it transferred into your hands, now consider what you want to exchange it for.
The first step in your plan should be to free yourself from debt. Debt is the most destructive force working against you. The gravitational pull of debt is much greater than the numbers or amount alone would suggest.
Consider using what I call the Division of Ten Principle. Every dollar is divided into ten:
- The first dime is the Tithe. I worship the Lord with this dime.
- The second dime is my investment. This dime will never leave my life. It is now forever in my employment.
- Dimes three through nine is for present living.
- Dime ten is surplus. This dime is reserved so that I never have to borrow a dime.
2. Start Small
Do not despise small beginnings. Solomon said, “When you gather money little by little you will see it grow.” If you are faithful in a little you will be made ruler of much. Consider your management of a penny as a qualification of a million.
David Green, founder of Hobby Lobby and related companies started his multi-billion dollar private corporation with a $600 investment!
3. Multiple Streams
Create multiple streams of income. Abraham was made rich in eight different streams of income (Genesis 24:35). Solomon said, “Give portions to seven, yes to eight, you do not know what disaster may come upon the land.”
If you have a fixed income – unfix it. You may have a good job at a secure company, yet you should always be in training, sharpening, and educating yourself for promotion. Start a business. Develop an idea. Invent something.
4. Be Consistent
Successful people do daily what others do occasionally. To gain the inertia of successful investment you must be consistent.
5. Think Long-Term
Secular people think only in terms of quarters and fiscal years. You have an eternal mentality; therefore, you naturally think long-term. Solomon said, “A righteous man leaves an inheritance for his children’s children.”
There will be seasons of great increase and seasons of decline but overall your investment will succeed as long as you don’t stay invested.
6. No Schemes
Do not get involved in schemes. There are a myriad of fraudulent people who use crafty schemes to make money. If it promises “that you will get rich with no effort” it is a lie. Walk away.
7. Protect Reserves
Store up don’t hoard up. Storing up reserves are important. It is suggested to have three to six months of reserves that would meet your basic living expenses if needed. You could even build it up to a year. Hoarding is stingily keeping money out of fear of loss or for the sake of pride. Hoarders become delusional and lose all they have.
8. Know What You Own
The Bible says, “Know the condition of your flocks and herds.” You should have specific knowledge of what you own. If you own stocks, you should know the company. You should never purchase what you don’t know.
Don’t compartmentalize your investments. I know a man who invests in “vice” stocks – those are companies who make their money on people’s sins and addictions. It is immoral to make money off the sins of people. I would never own tobacco, alcohol, or pornography companies. I won’t associate with them.
How do you get started?
Start small. Don’t despise small beginnings. Begin to read Dave Ramsey’s materials and attend his live seminars. I believe that he offers the best advise available for financial security, prosperity, and success. You will run into people who want to give you “free” advice which will ultimately cost you. Be careful to qualify those who speak into your life concerning money.
Be blessed and prosper.