Beating the Tax Man


Amid Australia and New Zealand’s challenging financial landscape of rising inflation and skyrocketing interest rates, families and individuals alike are struggling to maintain their financial commitments. As the average borrower with a $A500,000 loan is now (at the time of writing) paying an extra $A908 per month, disposable income is significantly reduced.

Times are tough, that’s for sure. But there are always things we can do to improve our circumstances. Below are nine practical steps, based on biblical principles, to achieve financial peace during the current economic downturn.

step 1: establish a budget and determine your income
“The plans of the diligent lead surely to abundance, but everyone who is hasty comes only to poverty.” Proverbs 21:5

Establishing a budget is one of the first steps in gaining control over your finances. Start by identifying recurring expenses such as rent or mortgage payments, school fees and utilities (internet, insurance, water and electricity). Then, look back at your bank statements to see if you can identify any other recurring expenses.

Once you have established a budget and identified your expenses, the next step is to determine your income. For those who work for wages, this may be a straightforward process. However, suppose your income varies from month to month, it may be helpful to think in terms of averages for longer periods of time (such as three months) for both your income and your expenses.

step 2: establish an emergency fund
“The wise store up choice food and olive oil, but fools gulp theirs down.” Proverbs 21:20

An emergency fund can be a wise and responsible way to prepare for unexpected expenses or financial crises. This fund should be a separate bank account with a balance of at least $2000, which can be built up over time to cover three-to-six months of living expenses. This fund can provide a safety net in case of unexpected expenses or income loss.

step 3: manage your expenses
“Suppose one of you wants to build a tower. Won’t you first sit down and estimate the cost to see if you have enough money to complete it?” Luke 14:28-30

The 60/20/20 rule recommends allocating 60 per cent of your income to essential living costs, 20 per cent to discretionary spending and 20 per cent to savings. Adjust these percentages to suit your unique financial situation but they can be a helpful guideline when deciding which expenses to keep and how to organise your spending habits.


step 4: tackle your debts
“The rich rule over the poor, and the borrower is slave to the lender.” Proverbs 22:7

If you have credit card debts and other loans, creating a plan to tackle them and reduce your overall debt is important. One highly recommended method is outlined in the book The Barefoot Investor by Scott Pape. A simplified version of this method is as follows:

• Begin by adding the minimum repayment amounts of all your credit cards into your “Recurring Expenses Category” budget. This will ensure you make the minimum payments on time, avoiding additional fees.

• Pay off the smaller debts first rather than focusing on the most expensive ones. This can provide psychological benefits and motivate you to continue tackling your debts.

• Use all the money in your savings account (different from the emergency fund), or “Fire Extinguisher” account as Pape calls it, to tackle those debts until they are . . . well, extinguished. This may require some sacrifice, but it can provide a sense of relief once the debt is paid off.

• Consider cutting up all your credit cards and using debit cards for every purchase. This means you’re only buying things for which you can pay upfront. This financial discipline can pay off and help you avoid the psycho- logical trap of credit cards that can often tempt you to spend beyond your means.

step 5: enjoy more free things
“Take delight in the Lord, and He will give you the desires of your heart.” Psalm 37:4

In tough financial times, it can be easy to feel like you are missing out on life just because you’re spending less. However, many free or low-cost activities can bring just as much joy and happiness. Consider going for a walk in the park, exercising outdoors or going to more affordable gyms. Starting a garden can save you money on groceries long-term, provide daily physical exercise and give you a sense of accomplishment. Other things that bring a lot of happiness and are free include being part of a faith community, reading inspirational books and spending quality time with family and friends.


step 6: practise generosity
“Whoever is kind to the poor lends to the Lord, and he will reward them for what they have done.” Proverbs 19:17

The Bible teaches that great joy comes from being generous. Whether giving to those in need or volunteering your time, there are many ways to practise generosity, even in tough financial times. Some people choose to tithe, which means giving away 10 per cent of their income each pay. By giving to others, you can experience a sense of purpose and joy that goes beyond material possessions.

step 7: seek help
“As iron sharpens iron, so one person sharpens another.” Proverbs 27:17

It’s important to remember that seeking help is not a sign of weakness but a wise and courageous step towards financial health. There are many resources available for financial education, including books, podcasts and affordable professional financial advice. Consider asking a friend who is good with money to coach you through their system and philosophy, or look for free financial counselling services in your area.

step 8: practise gratitude
“Give thanks in all circumstances; for this is God’s will for you in Christ Jesus.” 1 Thessalonians 5:18

In tough financial times, it can be easy to focus on the negative and feel discouraged. However, practising gratitude can help shift your mindset and focus on the positive aspects of your life. Before going to bed, try noting down the things you are grateful for and what went well during the day. By focusing on gratitude, you can cultivate a more positive and hopeful outlook on life.

step 9: trust in God’s provision
“Therefore I tell you, do not worry about your life, what you will eat or drink; or about your body, what you will wear. Is not life more than food, and the body more than clothes? Look at the birds of the air; they do not sow or reap or store away in barns, and yet your heavenly Father feeds them. Are you not much more valuable than they?” Matthew 6:25, 26

Even amid financial challenges, we can trust in God’s guidance to find peace and hope. He will provide for our needs because He loves us. While tough financial times can be challenging, navigating them with peace and wisdom is possible. Why not try to put into practice some advice from the Bible that not only withstood but thrived through all the great financial crises of our planet?

Joseph Skaf is a pastor and stewardship director of the Seventh-day Adventist Church. He holds a degree in economics and has a background in investment banking. He writes from Newcastle, Australia.

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