The 6 Essential Steps to Taking Control of Your Finances

Have you ever felt lost, confused, or even helpless while managing your money?

Chances are you answered with a “yes”.  In fact, a recent survey revealed 4 out of 5 Americans think they could benefit from the advice of a financial professional.

Take Control of Your FinancesI see it all the time and I’m sure you do too.  Family, friends, coworkers.  It seems like everyone I know has had money problems at some point in their life.

The good news is, you don’t have to be in this majority.  You can join the 1 of 5 people that are comfortable with their financial situation.  You can be free.

Taking control of your finances is an important step toward the personal finance promised land.

Get your finances in order and back on track toward the land of Milk and Honey, by following these six steps.

1. Set the Scene

Take a minute to sit back and think about the current state of your finances.

How are things looking?  Why are you in your current position?

If you’re being honest with yourself, you probably have a whole list of ugly, bad choices lingering in your past.

It’s ok.  I do too.

Even if your finances are in complete shambles, there’s hope.  Many people have been in your same situation and are now enjoying financial freedom.

The purpose of this step is to accept your current financial situation.  Understand how you got here.  There are some valuable lessons buried in your past.  Don’t dwell on your past, but learn from your mistakes and take note of what you did well.

ACTION: Accept your past and present financial situation.

2. Build a Biblical Foundation

Now that you have stopped to acknowledge your past, it’s time to lay a solid foundation for the future.

Since this is Milk and Honey Money, we’re going to use the Bible as our authority.

God asks us to trust and love Him, not money.  Do you realize your money isn’t actually yours?  It God’s.  He has graciously given you everything you own (and can take it away again, just ask Job).  You are a steward of God’s money and this is not something to be taken lightly.

You can’t just sit back and hope for the best.  The Bible makes it clear we should be planning carefully, working hard, and living honest lives.  This should be the foundation on which your finances are built.

Hopefully this isn’t anything new.  You know this stuff.  Save for the future, don’t go into debt, don’t covet, invest your money wisely.  The Bible is full of sound financial advice.

Take the time to study and learn what that bible says about money.

Be a good and faithful steward by making the most of the skills and resources you have been given.

ACTION: Build from biblical financial principles.

3. Grasp the Basics

If you’re like me, you have a job.  Why do we have a jobs?  To earn an income.  Why do we need an income?  To pay our expenses.

Taxes, food, shelter, transportation, and the list goes on.  For some people this list of expenses is much longer than others, but the idea is the same for everyone.  Each month, money comes in and money goes out.

There’s just one simple, but very important rule that some people miss…

Your expenses must be less than your income.

Sounds simple, but not everyone follows this rule.  Some people spend more than they earn.  If this is you, it’s ok.  I’m not here to judge or condemn you.  I’m here to help you get back on track.

The remedy for this problem is balancing your budget.  Usually, the quickest and easiest way to accomplish this is by cutting a few big expenses out of your budget.  Be aware of little expenses too.  They can add up quickly!  You can also balance your budget by increasing your income, but this usually takes more time and effort.

I’ll go into more detail on how to balance your budget in an upcoming post, but if you’re up for challenge, go ahead and get a head start!  You could cancel your cable subscription.  Start bringing your lunch to work.  Stop buying things you don’t need.  Go for it!

ACTION: Spend less than you earn.

4. Restore Your Mindset

Alright, let’s do a quick review to see what we have accomplished.

You have…

  • Accepted your past and present financial situation
  • Learned what the bible says about money
  • Realized you need to spend less than you earn

Now it’s time to let these facts change the way you think about money.

Your money is a resource that God has given you.  You can be wise and make the most of your situation, or you can squander it away.  The choice is yours.

The next time you whip out your wallet, think about money as a tool given to you by God.  Think about what’s important to him.

Yes, this is a complete shift from the way modern America handles their finances.  Our instinct is to buy whatever will make us happy.  Right now.  We want every new thing our neighbor gets, just bigger and better!

I’m not suggesting you go overboard and deny yourself of everything that brings you joy.  God wants you to enjoy life.  Just be thoughtful with your money.  Keep your mind in check.

ACTION: Change how you think about money.

5. Commit and Persevere

Ok, we’re done with the easy parts.  This is where it gets serious.

Commit yourself to faithfully taking control of your finances.  Take these lessons and turn them into habits.

I’m going to help you through this journey, but I would be lying if I said it was going to be easy.  You’re going to have  to make some sacrifices.

As time goes on, you may be tempted to stumble, drop out, and go back to your old ways.

Hold strong and persevere.  Control your urge to take your credit card on a shopping spree.

Look at the bright side, you’re reading a personal finance blog.  You want to improve.  You have shown your commitment and you’re headed down the right path.  Now all you have to do is follow through.

Remember, you’re managing God’s money.  He wants you to make the right decisions.  If you need help along the way, don’t hesitate to ask Him for strength, guidance, and wisdom.

ACTION: Commit yourself to taking control and following through.

6. Plan and Set Your Goals

At this point, you’re ready to hit the ground running.  You know you’re headed to the land of Milk and Honey, but wait.  Where is that exactly?

It’s going to be different for everyone.  To figure it out for yourself, you need to do some planning.  Setting goals will keep you going in the right direction.

To focus your goals, start by making a list of your priorities.

My Top 5 Priorities

  1. God
  2. Family
  3. Work
  4. Church
  5. Fun

Once your priorities are set, you can start to build goals for the future.  Your goals will be dependent on factors like your age, relationships, family, and current financial situation.

If you’re married or in a relationship heading toward marriage, you need to do this planning with your partner.  This is a perfect opportunity to talk about your future as a family (or future family).  You may have to negotiate and give up some things on your wish list, but it’s important end up with and agree on the same financial goals as a family.

Now, use your priority list as a reference and make a list of your goals.  More than likely, your goals will change as time goes on, but it’s still important to have a plan so you know where you’re headed.

My Top 3 Goals

  • Give more than 10% of my income
  • Buy a house and pay off the mortgage early
  • Create additional income sources

Don’t worry about the order or timing of your goals right now.  We will cover that in subsequent posts.  For now, just list a few financial goals that you (and your family) would like to achieve.

ACTION: Set your priorities and create financial goals.

As you’re planning, take a hard look at your priorities and goals.  How do they compare with God’s priorities and goals?  Are they in agreement?

Think about what really matters to you.  What do you want to accomplish in your life?  At the end of the day, how do you want to be remembered?

Be a good steward of God’s money.  Your reward will far exceed any treasures you are giving up here on earth.

Save your list of priorities and goals for future reference.  Make a copy and stick it in your wallet to help you stay focused.  Stay the course and you will be off to a great start toward the land of Milk and Honey.

What’s the next step on our journey?  Sign up for the newsletter to get an update when we publish our next post.

Did you enjoy this post?  If so, I would be forever grateful if you would share with your friends on Twitter, Facebook, or Google+.  Thanks!

(Photo by Jason Rogers)


  1. This is a really smart strategy! I especially like your action tips after each one. They’re simple but really effective if you put them into practice. I think the most important points you talked about are changing your mindset about money and getting your priorities right. Having an plan is essential to achieving your goals. Great stuff Zach and welcome to the personal finance blogosphere :)

    • Zach says:

      Thanks for the compliments Carrie!

      That’s the idea. I’m trying to keep things simple and focused on action. Most people can understand the concepts of personal finance just fine, but when it comes to actually following through, it gets a little tougher.

  2. I think what really worked for my wife and me was committing to the concept of “Spend less than you earn.” It’s really very simple. Either you have to cut spending on what you’re doing or you have to earn more. Either, or. No other option. That advice really got our heads set right!

    • Zach says:

      That’s right. It’s so simple. You just have to make that commitment.

      Congrats to you and your wife on getting your heads (and finances) back on track!

  3. I love the idea of setting your priorities and then following that up with goals that match them. I have been so busy that I haven’t actually sat down and reflected on what my priorities are and how my goals align with them.

  4. I like your first point that no matter how bad the situation is, there is always hope. I think lots of people get so overwhelmed and stick their heads in the sand. Financial troubles can be fixed but take lots of work, discipline, and change in attitude. It’s hard, but anyone can do it.

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