Hello Patrick,

I am going to have a major medical procedure in 12-18 months, which will require us to move to a major metropolitan area for several months. Apartments there cost about $2,300 per month, which doesn’t leave us much time to save up for this expense. Would you save your tithing money to pay for the apartment, or still give your tithe?

We are trying to follow Dave Ramsey’s Baby Steps and we are still in the debt snowball stage. I really appreciate your response.

Thank You,

SW

Hello SW,

I am sorry to hear about your upcoming medical procedure and I wish you the best with this procedure and your health. While it is unfortunate that you will have to undergo a major medical procedure, you have been blessed with the knowledge of what the procedure is and roughly when it will happen. That does not make it any easier to have to go through, but it does give you a small advantage in being able to plan for it.

Now let’s talk a little bit about the financial planning aspect of your situation.

A brief introduction to Dave Ramsey’s Baby Steps

For those who aren’t familiar with Dave Ramsey’s Baby Steps, it is part of his Financial Peace University methodology. To follow the Baby Steps, one must first make a conscious decision to get out of debt, then follow his 7 step process: Build a $1,000 emergency fund, pay off all debt using a debt snowball, save 3 to 6 months living expenses (fully funded emergency fund), invest 15% of household income in retirement funds, create a college fund for your children, pay your home off early, build wealth and give. The last few steps can be done simultaneously. Dave Ramsey’s teachings are steeped in Christianity, and one of the things he advocates is tithing 10% of your income to God.

An important thing to remember is that while Ramsey’s Baby Steps are an effective way to get out of debt and build wealth, they are also only a guide and it can be modified to meet your needs.

Trying to save and pay down debt at the same time

Your situation is a little complex because you are dealing with the uncertainty of your medical condition while trying to save and pay down debt at the same time.

Saving and paying down debt at the same time can be done, but it becomes more difficult when you need to save a lot of money in a short time period, such as trying to save money to pay for an expensive apartment in a large city, and preparing to undergo an expensive medical procedure.

There is a lot we don’t know about your financial situation, but these are a few general tips that can help you or others in a similar situation.

Create a budget: One of the first things you should do if you haven’t already, is to create a budget. This way you will know where your current expenses are, how much income you have, and where your money is going. Once your budget is in place, you should use that as a tool to help you spend less and look for ways to earn more money, both now and in the future.

Spend less: Go through your budget and find ways you can cut expenses. Also consider the apartment you are saving for. $2,300 per month for an apartment is very high, even for some major cities. I used to live in Houston, and nice apartments on the outskirts of town could be had for half that price. It pays to shop around.

Earn More: Finding new sources of income is another way you can help your debt snowball or help increase your savings. It doesn’t even need to be a lot of extra money - every little bit can make a difference. You can earn extra money by selling unneeded items, working part time, doing freelance work or consulting, completing online surveys, etc. Of course, I make it sound easy. It isn’t necessarily easy, but it doesn’t need to be hard either.

Consider scaling back on your debt snowball. Dave Ramsey advocates using a debt snowball to pay off debt because it is a quick and effective way to reduce debt and make tangible victories. But Ramsey also doesn’t recommend using a debt snowball until you are current with your bills and have a basic emergency fund in place.

If you continue your debt snowball you will make good progress on your debt, but you may be setting yourself up for future debt if you won’t be able to pay for the apartment. If you decrease your debt snowball and only pay the minimums on your monthly debts, you can save the difference for an apartment fund so you don’t need to take on additional debt when you move to the city for the medical procedure. I would only look at this as a short term solution, but one that may be necessary to avoid future debt.

Reach out to your church. Someone in your church group may be able to put you in touch with someone in the city where you will have your medical procedure. They may know of more affordable houses or apartments for rent, or there may even be a family in the area willing to host you for a few months. While it may seem awkward to inquire about something like this, these kinds of arrangements are not unheard of in church communities.

Should you tithe when times are hard?

Tithing is a very personal thing, and it is not something that I, or anyone else, can tell you to do. My advice is to understand your beliefs on tithing, talk this over with your family and religious leader, pray about it, and make the decision you feel is the right decision to make. In the end, the decision is between you and God.

Of course I can’t send you on your way after only telling you to talk it over and pray about it. So I researched the web and talked to some of my friends and found several other articles about tithing, many of which you may find helpful.

Can you stop tithing when money is tight? Believing in God means you believe you will be provided for no matter what the circumstances. My friend Lynnae writes about Unemployment, Tithing, and God’s Provision. Her story is an anecdote about how God works in unexpected ways.

FMF answers some questions about tithing, and mentions you should continue to tithe even during tough economic times. He continues with more posts about tithing in the 21st century, and and more thoughts on tithing.

More articles on tithing

Pete from Bible Money Matters wrote a two part series about The Bible and tithing: To give or not to give? Here is The Bible and tithing: To give or not to give - Part 2.

Glblguy from Gather Little by Little, another Christian financial blog, writes about the benefits of tithing, and Joyful, Sacrificial Tithing.

Steve Pavlina writes about tithing from an emotional standpoint and discusses some of the many benefits one can receive from tithing. He goes on to mention that beyond tithing, there are non-financial ways to give, including offering your time, talents, and other gifts. I encourage you to read this article.

Finally, as you mentioned Dave Ramsey, I thought it appropriate to add his words to the mix. Here is what Dave Ramsey has to say about pausing tithes (this is only a small quote, I encourage you to read the rest):

The Bible does not mention anything about “pausing” tithing. Neither does it say that we will go to Hell if we do not tithe.  The tithe, which is a scriptural mandate, was not instituted for God’s benefit because He already has all the money He needs.  He does not need our money.

…Read the Bible and take from it what you will, and if you tithe, do it out of love for God, not guilt.

This is your decision

This is a decision between you and God and no matter which decision you make, I don’t think anyone will judge you. I pray you find peace and health in the coming months.

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Please feel free to continue this discussion in a respectful manner in the comments section.

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My question is this: Is it ethical to reduce the amount you leave just to save a few bucks? Or should we leave the same amount, or even more?

I am of the opinion that if you can afford to leave a little extra, you should. What do you think?

Note: There is a poll embedded within this post, please visit the site to participate in this post's poll.

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Just before the Super Bowl I went to the store to pick up a keg of beer for my neighbor’s party. The cashier didn’t know how to ring it up, or where to find the price in the book. Since I also got roped into picking up the keg for the New Year’s party, I knew exactly where to find the information.

The beer I selected was Killian’s Irish Red, which, at $80 (including keg deposit), isn’t the cheapest beer out there. In the price book, there was a $60 keg listed next to the Killian’s. I noticed the guy in line behind me look at the prices, make eye contact with me, and give me a little nod and a wink. He knew the cashier didn’t have a clue which kind of beer I was buying, and I could make off like a bandit… which I would have been had I lied.

The easy choice would have been to make (steal) a quick $20, and no one would have ever known. Except I would have known. And the guy behind me as well, but I expect he would have bragged about it to his buddies, and the drunker he became that night, the story would have morphed into how he helped some guy walk out the door without paying for a keg of beer. The guy behind me actually shook his head as I paid full price.

Big deal, right? It’s not hard to pass up $20.

You’re right, it’s not. But how about $200? Several years ago I went to a clothing store to buy a suit. Again, the poor cashier didn’t have a clue what was going on. In the midst of scanning my items, she rang up a $22 tie twice, and skipped over the $220 suit pants. Surprisingly, I didn’t even notice. I paid my bill and was walking out the door when I remembered to check my receipt to get the alterations code. That is when I noticed the error. I know, it’s tough to miss a $200 error… but I was talking to a friend and not paying attention.

Here, the easy thing would have been to go over to the alterations, pay $15 to get my pants altered, and be on my way. But that would not have been the right thing to do. For most people, $200 is a considerable sum of money. I was in the military at the time and my paycheck was about $700 every two weeks. My total bill was roughly half a paycheck, so that much money meant a lot to me. But my integrity meant much more. Physically, it would have been extremely easy to walk out that door and get away without paying $200. But I would have had a hard time dealing with the knowledge that I stole something, let alone the fact that someone else could be held accountable for the loss.

When I returned to the cashier’s line, I’m not sure who was more embarrassed - me or the cashier. Either way, I felt good when the cashier swiped my debit card and I bought my suit. I still own it.

What is right and what is easy do not always align with each other. Sometimes the best option is to do what you know to be right, even when it is more difficult.

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As someone who is freely giving with the intent to help people who need assistance, you should be able to ask questions and receive reasonable answers before you decide whether or not you should donate to a particular organization.

Questions to ask when solicited by a charity:

1. Is the charity legitimate?
2. Does this charity represent something you support?
3. How will the charity use the donations you give them?

1. Is the charity legitimate?

Unfortunately there are many charities out there that are either fraudulent or less than forthcoming with their records. A good way to find out whether or not a public charity is legitimate is to find out if they qualify as a “tax exempt” organization with the IRS. To do this, you can request a copy of their IRS Form 990, “Return of Organization Exempt From Income Tax.” Federal law requires public charities to send you a copy of its IRS Form 990 for a reasonable charge, upon request. In addition, you can request a copy of the organization’s Annual Report.

However, just because an organization has filed a Form 990, that doesn’t mean they are actually a legitimate charity. It is easy to file a form with the IRS. You will also want to investigate a little more into the charity’s regular dealings and determine how and where they spend their money. More on this later.

Note: Private charities and churches and related organizations are also not required to file Form 990s and do not have to provide a copy of their IRS tax filings to the public upon request. You will have to do other research on these organizations.

You can also research the charity on-line. These websites can also help you find information about the legitimacy of a charitable organization:

• American Institute of Philanthropy
• Charity Navigator
• Give.org
• GuideStar
• CFC Questions from donors

2. Does this charity represent something you support?

This criterion could almost be interchangeable with number one, but I feel it is important to know if the organization is legitimate so you can help prevent other people form giving money to a dishonest charity. If the charity supports projects you agree with, then skip to number 3 - “How will the charity use your donations?”

If the charity doesn’t represent something you believe in, it doesn’t mean they aren’t a good charity, but it doesn’t mean you should support them either. Politely decline and ask to be removed from their contact list.

3. How will the charity use your donations?

Each charity should have a charter or mission statement that informs the general public of the charity’s goal. Most legitimate charities operate in a very transparent manner. At the minimum, the charity should be able to tell you how your donations will be used, and in some cases, you can even request that your funds only go toward certain uses.

You can even look past their mission statement, and determine how the money was actually used. Take for example, The American Red Cross fiscal year 2006 report, which shows that The American Red Cross spent 95% of their total expenses on charitable programs, 2% on fundraising, and 3% on administration. An overall efficiency of 95% is very impressive. The websites mentioned above can help you find some of this information.

You will also need to consider what you will donate and how the organization will use your contribution. Some charities are not set up to take certain donations.

What will you donate?

• Money: Always useful, always appreciated.
• Goods: Clothes, food, electronic equipment, etc. Make sure you know what they need or can use before donating.
• Time: Sometimes this is the most valuable gift you can give. For many people it is much easer to write a check than it is to spend a few hours helping out. But many charities need manpower more than money.

Giving to charitable causes is noble and giving is one of the best ways to help others. But you also have an obligation to make sure that your donations are going to an organization that you believe in and that your donations are going to be used properly.

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Then disaster happens. It all gets taken away from you.

No, the award was not made in error. In fact, the first payment of $50,000 had already been made. The lottery ticket was legitimate and verified. But now it turns out that winning this big award may end up sending one man to jail.

The problem was that any form of gambling, including purchasing a lottery ticket, violated the probation order of convicted bank robber, Timothy Elliot.

Under terms of his probation, he “may not gamble, purchase lottery tickets or visit an establishment where gaming is conducted, including restaurants where Keno may be played.”

State lottery officials routinely cross reference winners of large lottery prizes against state records to verify whether or not they have any back taxes or child support, and Elliot’s name came up on the bad boy list. A judge will soon determine what will happen to Elliot’s winnings.

In this case, it looks like his luck may have run out.

What do you think should happen to his winnings? Should he be allowed to keep them or not?

Source: MSN.

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Nine days passed from the time the ATM was reprogrammed until the theft was discovered. During that time, thousands of dollars were fraudulently taken - by the thief who reprogrammed the machine, and by others who unknowingly used a rigged machine, but kept the extra money without reporting it.

(If you are reading via a feedreader, you may have to click through to view the video).

I am fairly certain that no one reading this would be the kind of person to rig the machine to steal money. But how many people would actually report it and return the money? I would have a hard time walking away knowing I had just taken more money than I should have.

I am interested to read your comments.

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I know a lot of people can’t afford to take a $20,000 a year pay cut, and it’s not easy. Fortunately, we started planning for this drop in income well over a year ago and we were prepared for it.

To prepare ourselves for this drastic change in income, my wife and I paid down all of our consumer debt, trimmed unnecessary expenses from our budget, and began living well below our income level. After doing this we added more money to our emergency fund, and began investing a little extra in our retirement accounts while we had the available funds to do so.

My wife recently began her new job, and is very happy with her decision to try something new professionally – and so am I. Even though my wife and I earn about $20,000 less per year now, we are still financially stable and we now have a better quality of life than when she was earning more money, but working irregular schedules. I am glad my wife and I have a very open line of communication and planned for this a year ago – when we still had the time to prepare for it.

Unfortunately, not everyone has a chance to prepare for a drastic decrease in income. If you have to deal with a similar situation, I hope your story ends as well as ours did. If you are not able to prepare in advance for a drastic drop in income, I hope you will be able to find a way to handle your new situation. Later this week I will write about how to deal with a sudden and drastic drop in income.

Note: This is not intended to say anything bad about the military. My wife and I both served and are proud to have done so. For both of us though, we reached a stage in our lives where we wanted something else.

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Of course, anytime you can buy a brand new iPod for 99¢ it would seem to be a good deal. After all, the 2GB iPod nano retails for $149 at the Apple iPod Store. That is a savings of $148.01. Not bad! But, there were only 9 iPods available so if you didn’t get into line quickly, you weren’t going to get an iPod. How soon did you need to line up? The store opened on a Thursday, and the first person in line had been there since Tuesday - almost 2 full days before the store opened.

I don’t know about most people, but not only do I not want an iPod badly enough to camp out in front of a store for two days, but my time is worth more to me than $75 a day, not counting the time off from work I would have to take. Yes, an iPod is worth 99¢, but to me it is not worth that cost.

From the store’s point of view this is a great promotion. Not only do you get people lining up for a couple days to get in the door, but many people will actually stay around and buy other things as well. The best part for the store is all the publicity the get from it. It is well worth the $1,000+ they ate in iPod costs.

Apparently, this will be an ongoing promotion for the opening of new 99¢ Only Stores, so check their website for new openings near you. If you have 2 days to kill maybe you too can get an iPod nano for 99¢. Oh, and if you aren’t one of the first lucky 9, the next 99 people in line were able to purchase a scooter for 99¢. Yeah, apparently almost 100 people had nothing better to do than stand in line for a couple days to save $20 on a scooter.

I haven’t put an exact dollar amount on my time, but to me, an iPod for 99¢ and two days of my life is just not worth it. How much is your time worth?

Source: ABC News via Yahoo! See video.

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According to the top 10 list, fishermen have the highest fatality rate at 142 deaths per 100,000 workers. Pilots, loggers, structural steelworkers, refuse collectors, farmers, power linemen, roofers, drivers, and agricultural workers round out the top 10.

Some Hazardous Professions:

The Deadliest Profession - The Deadliest Catch. Commercial fishing is the most dangerous profession in the US. The Discovery Channel has profited immensely by syndicating a reality show, Deadliest Catch, which chronicles the fishing exploits of several crews fishing in the Bearing Straight for Alaskan king crab. The rewards are high, but the risks are higher. Wikipedia states Alaskan crab fisherman have a fatality rate of over 300 per 100,000 workers. According to the Discovery website, “There is a 100% injury rate, and deaths occur among the fishermen every week.” But there is also the possibility for fisherman to earn up to $100,000 for only a few days work. The Alaskan crab industry is worth over $65 million a year.

The Military. As a veteran of the USAF, I can relate to the thousands of service members facing extreme levels of personal danger on a daily basis. I pray for them often and thank them for their service and sacrifices. The reason most of them do this is not for a paycheck, but for greater reasons such as patriotism, honor, and duty.

On a personal level, I have been in designated war zones on multiple occasions. I have carried a weapon, felt the ground shake from mortars, and witnessed tracer rounds at a distance, but thankfully, I have never been in a direct firefight. Though I was in some danger, I never felt as though I was in extreme danger for my life.

Public Servants. Firefighters, police officers, EMTs. Everyday they put their lives at risk so that others may live. I don’t think we can thank them enough for their services to our society.

An entertainer to the end. A couple weeks ago my wife and I were attending an air show when we witnessed one of the stunt planes crash. Pilot Jim LeRoy was a Marine, engineer, and entertainer. He was also a husband and a father. He was a great pilot and entertainer, and he knew the risks he took every time he flew his acrobatic stunt show. After his stunt plane crashed, the emergency crews reached the crash site within 2 minutes. Unfortunately there was nothing they could do. Mr. LeRoy died doing what he loved best - entertaining thousands of people at air shows. He left behind a wife and 4 year old son. He was only 46 years old. My thoughts and prayers go out to your family and friends.

Why work in a dangerous profession? There are many reasons people work in dangerous occupations. Sometimes dangerous jobs are the only jobs available in certain communities, such as logging, mill work, and fishing. Many times there may be other jobs in the community, but none that pay as well as the more dangerous jobs. Others take dangerous jobs in order to serve and protect others.

The decision to leave a dangerous job is not always as easy as it may seem. For some people, this is the only profession they know. Others need the money. In many communities there is no other work. Some place duty, honor, and service above their own personal safety and put their lives at risk in order to serve others. As for me, I played my small part. After more than 6 years service in the USAF I left my previous position in the profession of arms for that of a less dangerous and more stable profession. To those who serve, and to those who work in a dangerous profession so that the rest of us may enjoy the standard of living we have come to expect, I salute you.

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There are a lot of other great posts in this edition of the Carnival. In particular, but in no particular order, I enjoyed:

• Silicon Valley Blogger: Who Buys Fake Goods? Plus How To Spot Counterfeit Products.
• Grad Money Matters: Condemning Our Future Generations To Be Born With A Plastic Spoon In Their Mouth?.
• Betsy Teutsch: Kids’ Birthday Parties: Parents! Get a Grip!

Check out the Carnival for some other great articles dealing with ethics, values, and personal finance.

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