61. FPU, ELPs, and Dave Ramsey

Recently someone asked the following questions:

1. After taking the FPU (Financial Peace University) class what did you change?

2. Are you investing on your own or using a one of the Endorsed Local Providers (ELPs)?

3. What areas do you disagree with Dave Ramsey?

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1. After taking the FPU (Financial Peace University) class what did you change?

We took FPU twice. Once with the CD's and a second time with the videos. Both times it was free to us (in-laws had the material already so we didn’t have to pay) through our local church. I’ve also listened to his radio show for about a year or two now.

After taking the class we started getting serious about getting out of debt. We (Mrs. Eagle and I) got on a budget and built up our emergency fund. We also now talk about money at least once or twice a month as a couple.

While Dave offers several methods of tracking expenses through his website (which cost money) we found http://www.mint.com is easy to use and free. 

I now have disability and more life insurance. Mrs. Eagle also has life insurance.

We also each wrote up a will. Need to update that come to think of it.

We’ve also saved up a little to start our kids college fund.

We got 100% out of debt before buying a house. When we did buy a house we put 20% down.

2. Are you investing on your own or using a one of the Endorsed Local Providers (ELPs)?

We invest on our own through Fidelity. We also are going to open accounts with Vanguard low cost index funds this year. We do not use Dave’s ELPs. The high fees associated with the ELP program seem inconsistent with Dave Ramsey's overall message. Therefore, some DR proponents find the ELP program difficult to reconcile within the context of FPU. 

That said, I realize Dave Ramsey is running a business and part of that business is income through ELPs. Nothing wrong with Dave making money but not everyone who goes through FPU uses his ELPs. Those who want to use them are free to do so of course.

3. What areas do you disagree with Dave Ramsey?

Things I disagree with Dave on:

1. Debt Snowball

Dave recommends the Debt Snowball (lowest balance) method. That (snowball) in some cases may be good advice to people who view money in an emotional manner. However, in many cases the Avalanche (highest interest) method is a better option and of course makes a lot more sense from a financial standpoint.

2. Credit Cards

Dave recommends everyone should get rid of their Credit Cards – I believe people who use credit cards responsibly (stuff they’d normally purchase anyway and pay off the card every month) can earn good rewards such as cash back or mileage.

3. Investments

Dave recommends ELPs and front loaded investments that cost too much in fees IMO. There are better investments out there. I don’t think Dave emphasizes the 401k and Roth IRA option enough.

4. Tithing

Dave strongly recommends charity (tithing) while in debt. He even recommends it when people are in bankruptcy. I disagree with this view specifically with people giving 10% of their income while in bankruptcy. Although I do think people should give to charity as they’re able or led by the Holy Spirit. But certainly not when they’re in bankruptcy.

What about you? Leave a comment!

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60. Famous Quotes Fridays May 23rd, 2014

"The problem is NOT that people are taxed too little, the problem is that the GOVERNMENT spends too much." - Ronald Reagan

This above… is truth.

59. What are your favorite Positive, Inspirational, and/or Uplifting Family Movies?

Positive, Inspirational, and/or Uplifting Family Movies

Here's some of mine… What are some of yours?

  

The Hiding Place (1975)

Chariots of Fire (1981)
The Mighty (1998)

Passion of the Christ (2004)

Facing the Giants (2006)

The Ultimate Gift (2006)

Faith like Potatoes (2006)

The Secrets of Jonathan Sperry (2008)

Fireproof (2008)

Letters to God (2010)

The Grace Card (2010)

Courageous (2011)

October Baby (2011)
The Secret Life of Walter Mitty (2013)
 

58. Should I Reduce My Tithe While in Debt or Even in Bankruptcy?

Should I Reduce My Tithe While in Debt or Even Bankruptcy?

This question came up on Dave Ramsey’s show and it has intrigued me ever since. 

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Should I Reduce My Tithe?

QUESTION: Janelle in Sacramento wonders if they should cut their tithe in order to help them get out of debt more quickly. Dave explains his spiritual take and that he wouldn’t stop his tithe or reduce it.

ANSWER: By definition, an evangelical Christian is someone who believes what the Bible says. That’s where we need to go for our answers, not some guy on the radio. However, I can help you with that. I’m not your authority; God’s word would be.

As I’ve studied Scripture, the word “tithe” literally means tenth. Deuteronomy says to give a tenth of your net increase—a tenth of your income. About 1,200 years of Protestant Christian teaching has been that the tithe goes to the local church because the local church is the New Testament representation of the Old Testament storehouse. The Old Testament storehouse took care of the Levites. The church in your community is supposed to be doing that. That’s an evangelical Christian definition of it.

When does it occur? As I’ve studied it in Scripture, it’s real clear that it’s off the top as it says in Proverbs. That’s before anything else occurs. Having said all of that, there’s enough toxicity in Christianity and misinformation, so let’s back up from that. God loves you whether you give money to the church or not. He doesn’t love you more if you give. We’re not going to get into performance-based legalism. We’re just doing this because we love God and that’s what He’s telling His kid to do. I’m going to follow that.

No, I wouldn’t stop my tithe. I wouldn’t reduce it. It’s a tenth. I tithed all the way into bankruptcy court and all the way out. These are a loving Father’s instructions for His kids.

Source: http://www.daveramsey.com/index.cfm?event=askdave/&intContentItemId=115234

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A few observations:

1 - Dave probably should’ve stuck with a simple answer and not gotten involved with the theological or historical side of the idea of tithing. The "storehouse tithing" doctrine has been taught in some American evangelical churches for around 100-200 years. It’s not a 1200 year old church teaching as Dave would have you believe. Why? Because Martin Luther hung his 95 thesis around 1517, so that would be 497 years that the Protestant Reformation has been in existence. So Dave is off by over 700 years. Roman Catholic indulgencies to my understanding do go back over 1000 years so maybe he’s thinking of that. Surely that’s not what Dave is referring to though.  

2 – I’m not sure which Deuteronomy reference Dave is alluding to here. Perhaps he’s talking about the tithe mentioned in Deut. 14:22-29. The only problem with using this passage or others associated with the tithe in the OT according to Mosaic Law is that the tithe was to be given twice a year and once every third year. This would bring the tithe to 23 and 1/3 percent each year and not the standard 10% taught in many churches. The tithe was a tax to pay for the Temple expenses and the Levites (see Num. 18:21) who were commanded not to work.  

3 - There is no passage of Scripture that I know of where the Bible states the NT “local church” represents the “OT Storehouse.” The Church is composed of people or Believers in Jesus Christ. The Church is not a building.

4 – “The church in your community is supposed to be doing that.” It’s interesting that Dave says this in alluding to caring for those who teach the Gospel. I agree with him there. It also could be a reference to caring for the poor and needy. I wonder how much of your church budget goes towards helping the poor and needy? That would be an interesting question to ask at the next business meeting.

5 - Dave’s Proverbs reference could possibly be Prov. 3:9-10. Perhaps this is the “honor the Lord with your wealth and firstfruits of all your produce.” I agree that we should honor God with our wealth. And Dave does get it right that God doesn’t love us more if we give more. God loves us infinitely more than we can imagine or even fathom. Nothing we do makes God love us more. Nothing we do makes God love us less. That’s not an excuse to sin but it truly freeing to live in the assurance of God’s love.

6 - Would any serious financial consultant recommend a Christian to tithe even when they are facing financial trouble and in particular bankruptcy? The moral, religious, and financial dilemma of this suggestion are intriguing.

7 - It’s not a secret that a large portion of Dave Ramsey's company and personal income for his financial services is derived from Evangelical churches. Probably you’ve seen an advertisement at your church to attend a FPU (Financial Peace University) seminar or watch the DVD’s for a class. How popular would Dave be with Evangelicals if he were to say that Christians could reduce their giving in certain life situations or to entertain the idea that generous giving might not be 10% for some Christians in certain situations?

I think we need to encourage Dave to talk about things he knows about such as personal finance topics and less on history or Christian Doctrine. People can tithe or give while in debt but I seriously take issue with saying people should do so while in bankruptcy. 

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57. Famous Quotes Fridays May 9th, 2014

Not really on Personal Finance… But some good thoughts on Parenting: 

"God wants Prodigal parents

Not Perfect parents.

{Lavish in Love,

Extravagant in Truth,

Big spenders of Grace}"

- Ann Voskamp, author of One Thousand Gifts

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