Saturday, December 20, 2008

A Reader Comments: The Blessings Of Biblical Entrepreneurialism

Andrea and I received a lovely letter from a reader, in response to our LAF article, "Dig Your Well Before You Need It," originally a response to, "Bringing Home Rebecca" titled, "What If He Dies?" It is as follows:

Dear Kelly and Andrea,

This morning I read your recent article on the LAF website and wanted to comment on it.

Your article is so true! I'm sure you have heard many examples of the success of what you are recommending, since God does prosper those who follow His ways. But I still wanted to say that yes, you are right! Entrepreneurship and economical stability can succeed even when the head of the family dies.

"So what happens when your husband dies or loses his job? You then have no job skills, no recent work history, and a mortgage to pay and kids to feed. Life insurance and unemployment are never enough to last more than a year. So how, exactly, do you plan to get by when your source of financial support goes away? Husbands don't live forever. Jobs don't last forever. Unless you have a backup plan, you're stuck trying to make ends meet on welfare or church assistance--neither of which goes very far. ALL women should keep up their education and job skills in order to serve their families in times of crisis. Taking off a little time here and there to be with infants is understandable. But don't fall into the trap of letting job skills go to seed."

Here’s what happened:

My faithful father did pass away at a relatively young age, four years ago, leaving a wife and two nearly-grown children and a legacy of hard work and good planning. And we didn’t have a mortgage, didn’t run out of life insurance, didn’t use welfare or church assistance, and the women didn’t have to start working—unlike the doubtful fears expressed in the question above. Of course, there was much work to do in managing his late estate; and we always love to stay industrious—but not out of worry of where the next meal would come from, thankfully.

Here’s how we were prepared:

My parents had built several houses and sold them, enabling them to build our then-current house without a mortgage, and eventually an out-of-town ranch as well. We did a lot of work ourselves, not on the actual framing and finishing of the houses, but on the landscaping and extra improvements which added value to the properties.

My dad had established a consulting firm thirteen years before, and through working at home had been able to have low overhead and greater savings. He had invested in life insurance ever since the start of his professional career, and the resulting payment was much greater than what would “last a year.” This aided in purchasing income-producing commercial properties and in allowing my mother to never have to work.

A few lessons that were realized:

Being out of debt was key, for it freed up all of the new resources (life insurance, etc.) for their best possible use. Out of debt, you can use resources without a feeling of guilt or worry. With no debt, it’s amazing how far money can go toward real needs—with some left over to invest in property or otherwise. If a family saves money and gets out of debt, it is incredibly fulfilling to be able to pursue entrepreneurial activities together, invest in greater income-producing potential, and enjoy the blessings of life. I realize there are many variables about type of vocation and state of the economy, but being debt-free will always, always, be a step in the right direction.

Being self-employed was, I think, a major factor in having the freedom to increase profit, save money, and not have even a mortgage. Being self-employed, we (but especially my father) had the freedom to be creative with our time and efforts, and also received all of the reward from our own labor. Our family worked together on everything and supported each other’s income-making endeavors. My brother and I worked hard at everything (in the house, farm, and business) from a young age, and though we never got an allowance nor got paid by the hour at first, we were well-compensated by being given wonderful opportunities and eventually being given a stake (directly or indirectly) in the profit of those endeavors.

With no debt, income and profit can span over generations,--such as enabling my brother to be grafted into my father's business, established at an early age, and capable of now supporting a family. You can be frugal and save money from the beginning of starting a household in order to reap exponential, generation-spanning rewards later on. I am so very thankful this was the pattern in our household. A little sacrifice in the beginning really does pay off in the long-term.

God’s providence has been paramount through this whole journey—from leading my parents to be self-employed and out of debt, to enabling us to be in a good financial position when my father passed away. Being in that advantageous position, however, made all the difference between being made destitute from a hard trial, and being able to weather it more than sufficiently. Having parents who invested so much into our lives has given us a great head-start for wherever we go in life. May we always use our abilities and financial freedom to serve God and others in a powerful way!

I’d encourage you to take the step for self-employment and debt-free living! It's a matter of living for the ease and luxury of the moment versus having a vision for future success and blessing. You’ll honor God and you’ll be more prepared either to sustain a hard circumstance or to prepare your children and grandchildren to start out strongly and prosper in life. Or both, in our family’s case. Praise the Lord!


Elle said...

So...the solution is to be rich? We can't all be rich. It's not possible. If we were all rich, then the cost of goods would adjust to account for that. The income would become the new middle-class. Then what?

Kelly said...

Hello Elle,
Thank you for commenting with your concern. I'm going to draw a bigger picture for you and I think it will help clear up your concern.

Scripture does say the poor will always be with us. (Mark 14:7) So point blank, every single person being rich is an impossibility. There's no need to even try to build on that premise.

The question of how valve is determined is a good one. The "valve" (or "cost of goods" as you put it) is not necessarily done by businesses motivated by the knowledge of how much $ we have in or pockets. It's not necessarily determined by everyone wanting the same things either.

A few things to keep in mind are: There are many factors which play into determining production costs. Think about market competition between producers. Think about government infringement on a businesses ability to produce. In short putting a product out in the market at a competitive price is not a simple thing to do. Businesses also have to compete for customers and that helps keep prices down.

Also, everyone doesn't desire to own the same thing nor do they need the same things. This means demand will fluctuate and when demand fluctuates business have to respond with prices that will compensate for that fluctuation if they are going to remain in the market.

If a ton of people want something and there aren't enough somethings for all of them, then the price of the somethings which are available will go up. If a ton of people want something and there are 2 tons worth of somethings and everyone doesn't want 2 each, than businesses will have to drop their prices in order to compete for customers.

Other factors play into what people will desire to buy and how much they will be willing to pay: Seasons, wars, retirement, medical bills, candy deficiencies. Did I say that?

Susanna Simpson said...

Thank you Kelly for posting this and to Renee for writing it! It really encouraged me to remember to save and use my money wisely. It's such an important issue for everyone to understand.