How To Be Financially Free

FaithFi: Faith & Finance | Jan 10, 2025

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Show Notes

Do you dream of being financially free but are unsure where to start?

Knowing what to do and actually doing it are two very different things. Today, we’ll share the steps to achieve financial freedom, but the decision to take action is yours. Like most worthwhile goals, it starts with the desire and determination to make it happen.

Start with a Mindset Shift

Financial freedom begins with a change in perspective. Many people approach budgets like a diet—focused on restriction and deprivation. Just as restrictive diets often lead to overeating, feeling financially deprived can lead to overspending.

Why does this happen? The Bible identifies underlying issues like greed, envy, covetousness, or a lack of faith in God’s provision. To overcome these, you need to cultivate gratitude.

As 1 Thessalonians 5:16-18 says:

“Rejoice always, pray without ceasing, give thanks in all circumstances; for this is the will of God in Christ Jesus for you.”

Gratitude shifts your focus from what you lack to what you have, enabling contentment and a more positive relationship with your budget.

Practical Tips for Living Below Your Means

Once your mindset is aligned, it’s time to take action. Here are some practical steps to help you live below your means:

1. Build Margin

Having money left over at the end of the month is critical for financial freedom. Start by scrutinizing your fixed expenses:

Can you lower your mortgage payment by eliminating PMI?
Reduce energy costs by being more efficient.
Cancel unused streaming subscriptions or other recurring charges.

Sometimes, simply asking for a discount—on medical bills or repairs—can save money. It never hurts to ask!

2. Track Your SpendingKnowing where your money goes is essential. The FaithFi app is an excellent tool for setting up a budget and tracking your spending. It can highlight areas where you can cut back, like unused subscriptions, potentially saving hundreds of dollars annually.3. Celebrate Small Wins

Budgeting doesn’t have to feel like a punishment. Reward yourself for hitting financial milestones:

Treat your family to ice cream after a week of staying on budget.
Celebrate building your emergency fund with a special dinner.

These small rewards keep you motivated without derailing your financial progress.

4. Delay Non-Essential Expenses

Stretch out spending for non-essentials like salon visits or subscriptions. For example, getting your nails done every six weeks instead of four can save $100 a year.

5. Declutter and Sell Unused Items

If you’re paying for storage, consider selling items you no longer need. A good rule of thumb: Let it go if you haven’t used it in a year. This can free up cash and eliminate unnecessary expenses.

Increase Your Income

If you’ve trimmed your expenses but still struggle to live below your means, it’s time to explore ways to boost your income.

Take on a side job in the gig economy.
Pick up extra hours at work or ask for a raise.
Leverage your skills for freelance or consulting opportunities.

Even a modest income increase can significantly improve your financial situation over time.

Learning to live below your means allows you to serve God more fully, free from the weight of financial stress. It’s a journey of faith, discipline, and intentionality, but the rewards—both spiritual and financial—are worth it.

On Today’s Program, Rob Answers Listener Questions:

I recently left a domestic violence situation and will be receiving around $200,000 from the sale of our home. I have limited income and minimal debt. Should I use the home sale proceeds to pay off all my debt to start fresh, or should I keep the debt and make payments to rebuild my credit while holding onto the home sale money for a year or two?
I'm turning 65 in March and will be Medicare-eligible. However, I plan to continue working and have employer-sponsored insurance, including an HSA, to which I contribute. I've heard conflicting information—can I continue not enrolling in Medicare now, and can my employer continue contributing to my HSA?
My IRA advisor is transferring to LPL Financial. Charles Schwab recommended that I roll over my $300,000 IRA to them and invest directly in stocks rather than mutual funds, saying I was too conservatively invested. Should I stay with my current advisor as they move to LPL, or should I look for a new advisor at Charles Schwab or elsewhere?
I have one loan left, a 7.25% bank loan of about $20,000. I also took out a $14,000 401(k) loan. I plan to retire in May when I turn 65. Would it be best for me to pay off both of these loans before I retire, even though it would mean withdrawing from my 401(k) to pay off that loan?

Resources Mentioned:

Remember, you can call in to ask your questions most days at (800) 525-7000. Faith & Finance is also available on the Moody Radio Network and American Family Radio. Visit our website at FaithFi.com where you can join the FaithFi Community and give as we expand our outreach.