the prophetic model of prosperity - stephen...
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The Prophetic Model of Prosperity
© 2009 Stephen & Karina Palmer www.GodsLawsOfFinance.com
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About the Authors
Stephen Palmer is a marketing strategist, consultant, and writer with K-Gaps Consulting and a founding partner of The Center For Social Leadership.
He is the New York Times, Wall Street Journal, USA Today, and Amazon bestselling co-author of Killing Sacred
Cows: Overcoming the Financial Myths that are Destroying Your Prosperity.
Stephen graduated from George Wythe University with a degree in Social Leadership and Statesmanship in 2006. He is also a graduate of Wizard Academy.
A dedicated scholar and promoter of personal, financial, and governmental freedom, Stephen is passionate about political philosophy, economics, history, personal finance, entrepreneurship, religion and spirituality, family, education, and culture. He shares his passion on The Cause of Liberty.
Stephen served a Spanish-speaking LDS mission in Hartford, Connecticut from 1996 to 1998.
Karina Palmer is a supportive wife, home-schooling mother, and ex-entrepreneur. Karina spent ten years as a certified Court Reporter, owning and operating her own agency.
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She is a lifelong learner, constantly reading classics from a broad range of fields, and then teaching them to her children on a daily basis.
Stephen and Karina reside in Round Rock, Texas with their awesome son Alex and gorgeous daughters Libby and Avery.
They blog about their beautiful life on The Road Less Traveled.
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Why We’re Writing God’s Laws of Finance
After years of being immersed in the “prosperity industry,” spending well over $100,000 on financial education through books and seminars, we found ourselves buried in debt and on the brink of bankruptcy after a series of real estate investment blunders.
In the depths of humility, we realized that despite our intense study of personal finance, investing, and entrepreneurship, we had never studied in depth what the prophets have consistently taught since the restoration of the gospel.
This realization plunged us into an intense study of personal finance from a revelatory perspective. We researched everything we could find from prophetic sources that would illuminate financial truths and help us discern the “philosophies of men, mingled with scripture.”
The result was the emergence of a comprehensive model that gave us a big-picture overview of the purpose and appropriate use of prosperity, as well as detailed advice regarding every aspect of finances.
Our hope is that readers will find this model as useful as we have. Furthermore, we sincerely hope that through our efforts others can be spared the pain from the mistakes that we have made.
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Table of Contents....................................................................................................From Ideals to Blessings:The Complete Model 9
....................................................................................................................................The 6 Phases of Prosperity 11..........................................................................................................................................................................................The Model 13
............................................................................................................................Phase 1: God’s Financial Ideals 17.........................................................................................................................................................Seek First the Kingdom of God 18
........................................................................................................................................Use Money to Achieve Eternal Happiness 19........................................................................................................................................................Love Your Neighbor as Yourself 20
..................................................................................................................................Phase 2: Prepare & Protect 21............................................................................................................................................................................................Insurance 22
...............................................................................................................................................................................................Savings 24..........................................................................................................................................................................Food & Fuel Storage 25
.....................................................................................................................................................................Tax and Estate Planning 26
..........................................................................................................................Phase 3: Financial Management 28...........................................................................................................................................................................Pay an Honest Tithe 29
....................................................................................................................................................................Live Within Your Means 31......................................................................................................................................................................................Use a Budget 32
......................................................................................................................................................Work Towards Home Ownership 32.....................................................................................................................................................Honor Your Financial Obligations 33
.....................................................................................................................................................................................Manage Debt 34.....................................................................................................................................................................................Invest Wisely 36
........................................................................................................................Phase 4: Choose the Right Career 37......................................................................................................................................................................................Self-Reliance 38
...............................................................................................................................................................Achieve Your Full Potential 39..........................................................................................................................................................................................Excellence 39...........................................................................................................................................................................................Education 40
................................................................................................................................................................Maintain Gospel Standards 40
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....................................................................................................................Phase 5: Increase Your Productivity 41...............................................................................................................................................................................................Service 42
.........................................................................................................................................................Focus on Increasing Production 42....................................................................................................................................................Produce More Than You Consume 43
...........................................................................................................................................................................Cope With Inflation 44
..................................................................................................Phase 6: The Blessings of Financial Obedience 45..................................................................................................................................................................................Material Wealth 47
....................................................................................................................................................Spiritual Freedom and Confidence 48.......................................................................................................................................Unity Within Our Families and the Church 49
.................................................................................................................Peace, Joy, Health, Happiness, Wisdom, and Fulfillment 50
..............................................................................................................................................................Conclusion 52................................................................................................................Help Us Write God’s Laws of Finance 55
..........................................................................................................................................................................We Need Your Help! 55
..........................................................................................Recommended Conference Talks & Ensign Articles 56
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From Ideals to Blessings:The Complete Model
The Complete Model“The love of money is the root of many evils because it often involves selfishness. On the other hand, the wise use of
money involves principles of righteousness. It involves sacrifice and discipline. It is the acid test of our faith.”
- James E. Faust
After experiencing financial failure first-hand, we researched
everything we could find on personal finance from prophets and
apostles. Our research revealed a comprehensive, coherent model of
prosperity.
Seeing these basic, common sense truths within the context of this
model puts them all into perspective and gives one a macro view,
with an understanding of how individual parts fit into a greater whole.
The model is built using six distinct phases, or concepts, each of
which builds upon the other. The sequential order is critical—each
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step follows the other and dangers arise when the process is pursued out of order.
The sequence was arrived at by studying the emphasis placed by the prophets and
apostles on each, as well as the frequency with which each has been taught.
This is not to say that we can't work on different components simultaneously; we
must simply understand that there are definite degrees of importance placed on each, and so our efforts should reflect that
order as much as possible. In other words, the model provides us with a systematic way to approach our finances.
the model provides us with a systematic way to
approach our finances.
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The 6 Phases of ProsperityThe six phases are Ideals, Preparation & Protection, Management, Career, Productivity, and Blessings.
1. Ideals are the righteous purposes behind wealth creation. They represent our motivations for acquiring wealth—or at least
what they should be.
2. The Preparation and Protection phase consists of basic steps to protect our wealth, such as insurance, savings, food
storage, and tax and estate planning.
3. Management is our ongoing financial actions and habits; in other words, it’s what we do with our cash flow and spending.
4. Once we have started out with the right ideals, properly prepared and protected, and have learned to manage our finances
appropriately, the next step is to choose the right career. This choice comes with specific guidelines.
5. With this step in place, the next phase is to increase our productivity as much as possible.
6. And all of the phases working together lead us to promised blessings.
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If we compare financial management to going on a road
trip, the first phase—foundational ideals—ensures that
we are heading to the right destination. The second
phase of preparation and protection helps us to pack the
right things in our car to prepare for whatever may arise
during our trip. Phase three—management—is like the
maintenance we perform on our car while traveling, such
as changing the oil, washing the windows, fueling up,
etc. Choosing the right career, which is the fourth phase,
can be compared to the sights we enjoy along the way.
Phase five—increasing our productivity—is like
optimizing the speed and performance of our car. And finally, the last phase, or the blessings we receive through financial
obedience, is arriving at our destination.
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The Model
Once we identified these distinct phases, the following model emerged.
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The model is cyclical in nature. As we obey the prescribed laws and follow each step,
we receive blessings. Then, as blessings are received, we reconnect with the ideals,
but at a higher level. We have more resources with which to apply the ideals. And the
more times we go through the cycle, the more we prove to God that we are worthy of
prosperity.
“When this people are prepared to properly use the riches of this world for the
building up of the Kingdom of God, He is ready and willing to bestow them upon
us. I like to see men get rich by their industry, prudence, management and
economy, and then devote it to the building up of the Kingdom of God upon the
earth.”
– Brigham Young1
The gap between blessings and ideals is critical, as this is where people typically get derailed. This is the Book of Mormon
pride cycle deviation, where increased prosperity (blessings) lead to pride, then disobedience, then conflict, then destruction,
then humility.
As we obey the prescribed laws and follow each step, we
receive blessings. Then, as blessings are received, we reconnect with the ideals, but at
a higher level.
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1 Journal of Discourses, Volume 2, 114-115
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Each phase comes with prescribed laws. These are listed in the complete model below, then explained in greater detail in
subsequent chapters.
Phase 1: Foundational Ideals• Seek first the kingdom of God.• Use money to achieve eternal happiness.• Love your neighbor as yourself.
Phase 2: Prepare & Protect• Have adequate insurance.• Save a percentage of your income.• Have a food and fuel storage program.• Preserve and utilize your assets through appropriate
tax and estate planning.
Phase 3: Financial Management• Pay an honest tithe.• Live within your means.• Use a budget.• Work towards home ownership.• Honor your financial obligations.• Manage debt appropriately. • Invest wisely.
Phase 4: Choose the Right Career• Choose a career that will allow you to be self-reliant.• Choose a career that will require you to stretch to your full
potential.• Always strive for excellence in your workmanship.• Make education a continuing process.• Choose a career that allows you to fully live the gospel and not
compromise your standards.
Phase 5: Increase Your Productivity• The essence of productivity is service.• Increasing production is more important than decreasing
expenses. • Our production must always exceed our consumption.• Strive to understand and cope with inflation.
Phase 6: The Blessings of Financial Obedience• Material wealth.• Spiritual freedom and confidence.• Unity within our families and the church.• Peace, joy, health, happiness, wisdom, and fulfillment.
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Phase 1: God’s Financial Ideals“What are riches for, then? To be used in doing good. Therefore, let us dedicate our means to the building of the
kingdom of God.”
- Elder Franklin D. Richards
“But seek ye first the kingdom of God, and his righteousness; and all these things shall be added unto you.”
- Matthew 6:33
Unlike the traditional sense of the word, God’s financial ideals do not refer to something we look up to, or something we’re
working toward. Rather, they are the very foundation, the starting point that sets the prosperity cycle in motion.
It’s not a matter of them being “out there” while we strive to reach them—if they’re not in our hearts to begin with we won’t
reach any gospel ideal.
Our studies uncovered the three following major ideals:
1. Seek first the kingdom of God.
2. Use money to achieve eternal happiness.
3. Love your neighbor as yourself.
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Seek First the Kingdom of God
The Book of Mormon prophet Jacob commanded, “But before ye seek for riches,
seek ye for the kingdom of God. And after ye have obtained a hope in Christ ye
shall obtain riches, if ye seek them; and ye will seek them for the intent to do
good—to clothe the naked, and to feed the hungry, and to liberate the captive,
and administer relief to the sick and the afflicted.”
Is our desire to move God’s work forward our primary thought, or an
afterthought? Do we spend more time thinking about building our bank account
than we do about building the Kingdom? We’ve been commanded to consecrate
all that we are, all we have, and all we do to building God’s kingdom. In fact, it’s a
condition of temple worthiness.
Seeking first the kingdom of God is by no means an either/or sacrifice—we’re not choosing between either being wealthy or
serving God. The scriptures plainly teach that those who serve God are blessed both spiritually and temporally.
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Use Money to Achieve Eternal Happiness
Marvin J. Ashton taught that, “Money in the lives of Latter-Day Saints should be used as a means of achieving eternal
happiness…God will open the windows of heaven to us in these matters if we will but live close to Him and keep His
commandments.” We learn from Doctrine & Covenants 11:7 to, “Seek not for riches, but for wisdom; and behold, the
mysteries of God shall be unfolded unto you, and then shall you be made rich. Behold, he that hath eternal life is rich.”
We prosper by seeking the kingdom of God and living the gospel. After acquiring wealth, it’s critical to continue using it for
the right purposes. In other words, we invest our profits back into building the kingdom.
As L. Tom Perry explained, “So often it is the order of things that is fundamental in the
Lord’s instructions to us. The Lord is not telling us that we should not be prosperous.
This would be inconsistent with the many records we have of Him blessing His people
with prosperity. But He is telling us that we should seek prosperity only after we have
sought and found Him. Then, because our hearts are right, because we love Him first
and foremost, we will choose to invest the riches we obtain in building His kingdom.”
Of course, we can’t buy our way into heaven. But we can use our money for good
works.
because we love Him first and foremost, we
will choose to invest the riches we obtain in building His kingdom.
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Love Your Neighbor as Yourself
Dallin H. Oaks asked pointedly, “…are we responsible to look after the well-being of
our neighbors as we seek to earn our daily bread? The Savior’s Golden Rule says we
are. Satan says we are not.” Doctrine & Covenants 82:19 gives us insight into the ideal
society: “Every man seeking the interest of his neighbor…”
Prosperity involves exchange and interaction with others. As we engage in exchange,
we must always remember the Golden Rule. Righteous Christians do not separate
their religion from their business life. As Dallin H. Oaks said, “Followers of Christ have the moral responsibility of earning their
livings and conducting their financial transactions in ways that are consistent with the principles of the gospel and the
teachings of the Savior.”
We’re taught to deal mercifully with the poor and the naïve. We learn from Jacob to “Think of our brethren like unto
yourselves, and be familiar with all and free with your substance, that they may be rich like unto you.” In Doctrine &
Covenants 52:40 we learn that if we do not remember the poor and the need, the sick and the afflicted, we are not Christ’s
disciples.
if we do not remember the poor and the need,
the sick and the afflicted, we are not
Christ’s disciples.
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Phase 2: Prepare & Protect“The Lord has told us that if we are prepared, we shall not fear…personal and family preparedness is vital to our
eternal welfare and happiness, and it is important to be strong financially, as well as spiritually, mentally, and
physically.”
- Elder Franklin D. Richards
“Too often, people assume that they probably never will be injured, get sick, lose their jobs, or see their investments
evaporate. To make matters worse, often people make purchases today based upon optimistic predictions of what
they hope will happen tomorrow. The wise understand the importance of saving today for a rainy day tomorrow…”
- Joseph B. Wirthlin
“There are many very good people who keep most of the Lord’s commandments with respect to the virtuous side of
life, but who overlook His commandments in temporal things. They do not heed His warning to prepare for a possible
future emergency, apparently feeling that in the midst of all this trouble ‘it won’t happen to us.’ To prepare for the
future is part of God’s eternal plan, both spiritually and temporally. To protect ourselves against reversals and
hardships is only good sense.”
- Mark E. Peterson
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The foundation of our financial house is built with the gospel ideals of seeking first the kingdom of god, using money to
achieve eternal happiness, and loving our neighbors as ourselves. With the foundation solidly in place, next comes the
framing, which is preparation and protection.
Through our research, we identified the following components of this phase:
1. Have adequate life, medical, homeowners, automobile, and disability insurance.
2. Save a percentage of income.
3. Have a food and fuel storage program.
4. Preserve and utilize your assets through appropriate tax and estate planning.
Insurance
We learn from Marvin J. Ashton, “It is most important to have sufficient medical, automobile, and homeowner’s insurance and
an adequate life insurance program. Costs associated with illness, accident, and death may be so large that uninsured
families can be financially burdened for many years.”
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J. Richard Clarke added, “One final concern of reserve deficiency is the need to insure
against our greatest potential loss. I think we all would agree that our ability to earn
is our greatest asset. When the provider insures his life, he is insuring his future
income for his family. As husbands, let us not force our wives into the marketplace
to be both the provider and homemaker should our lives be cut short by premature
death. We can increase their options by proper insurance planning. We would also
urge each family to carry adequate health insurance. Medical costs are soaring, and
trying to self-insure from personal savings is very risky. During inflation, medical
costs increase faster than our savings accumulate.”
Just as the wise man built his house upon a rock, wise financial stewards prepare for unforeseen events and circumstances by
securing appropriate and adequate insurance. Insurance mitigates risk and allows us to continue creating value in the world
even after we have died.
Insurance mitigates risk and allows us to
continue creating value in the world even after
we have died.
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Savings
J. Richard Clarke taught, “God gave a natural instinct to the animals he created to
preserve their surplus against a time of need. But man has developed the
tendency to squander all that he harvests and to leave to chance or to others his
satisfaction of future needs. This is contrary to divine law. Frugality is a principle
of righteousness. In addition to our reserve of food, we should build a cash
reserve.”
The scriptures and modern-day teachings give us repeated instructions to
spend less than we earn and save a portion of our income. Such savings may be used for emergencies, investments, and
retirement.
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Food & Fuel Storage
We learn from Marvin J. Ashton to “Accumulate your basic food storage and
emergency supplies in a systematic and orderly way. Avoid going into debt for these
purposes. Beware of unwise food storage promotional schemes. Planting and
harvesting a garden annually is helpful to the family in many ways, including the
food budget. Eat nutritious foods and exercise appropriately to improve health, thus
avoiding many medical costs.” Gordon B. Hinckley said, “As we have been
continuously counseled for more than 60 years, let us have some food set aside that
would sustain us for a time in case of need.”
In addition to saving a percentage of our income, we are also commanded to save food and fuel to be prepared for
emergencies. The ideal, as taught by the prophets, is that we build and maintain a year’s supply of food, water, and fuel.
The ideal, as taught by the prophets, is that we
build and maintain a year’s supply of food,
water, and fuel.
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Tax and Estate Planning
The prophets are clear that we must be honest and abide by all
applicable laws in the payment of taxes. As Dallin H. Oaks
taught, “I have corresponded with several Church members who
sought to use something President Ezra Taft Benson was quoted
as saying as a basis for refusing to file an income tax return or to
pay income taxes. I have tried to persuade these persons that
their interpretation cannot be what President Benson intended,
because all who have held that sacred office, and all of the
General Authorities, have faithfully filed their income tax returns
and paid the taxes required by law.” Marvin J. Ashton taught, “Every LDS family should file honest and timely tax
returns.” Russell M. Nelson added, “A saint is an honorable citizen, knowing that the very country which provides
opportunity and protection deserves support, including prompt payment of taxes and personal participation in its legal
political process.”
However, along with the guidance to be honest in the payment of taxes comes the counsel to preserve our assets
through proper planning. Franklin D. Richards directed us to “Preserve and utilize your assets through appropriate tax
and estate planning.”
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Steven J. Dixon explained, “The purpose of estate planning is to permit us to enjoy our property during life and then pass the
unused portion to whomever we choose, with the least possible shrinkage in value. With wise planning, we can accomplish
the following desirable ends: satisfy our personal needs and desires and those of our family, ensure that our property is left
to the intended beneficiaries, designate someone to care for minor children, reduce family contentions, reduce the cost of
transferring property upon death, and minimize income, gift, estate, and inheritance taxes.”
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Phase 3: Financial Management“Money management should take precedence over money productivity.”
– Elder Marvin J. Aston
“I am convinced that it is not the amount of money an individual earns that brings peace of mind as much as it is
having control of his money. Money can be an obedient servant, but a harsh taskmaster.”
- N. Eldon Tanner
The first phase—starting out with the right ideals—prepares us for life after death. The second phase—preparation and
protection—prepares us for unforeseen circumstances during this life. This third phase deals with how we manage our cash
flow, income, and expenses on a daily basis.
Money management consists of the following steps:
1. Pay an Honest Tithe
2. Live Within Your Means
3. Use a Budget
4. Work Towards Home Ownership
5. Honor Your Financial Obligations
6. Manage Debt
7. Invest Wisely
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Pay an Honest Tithe
Gordon B. Hinckley urged, “With all my heart…I plead with the Latter-day Saints to live honestly with the Lord in the
payment of tithes and offerings…There has been laid upon the Church a tremendous responsibility. Tithing is the source
of income for the Church to carry forward its mandated activities.”
Marion G. Romney directed, “…tithing is a debt which everyone owes to the Lord for his use of the things that the Lord has
made and given to him to use. It is a debt just as literally as the grocery bill, or a light bill, or any other duly incurred
obligation. As a matter of fact, the Lord, to whom one owes tithing, is in a position of a preferred creditor. If there is not
enough to pay all creditors, he should be paid first.”
The law of tithing states that we are to donate a tenth of our increase, or interest, to the Lord for the building of His
kingdom upon the earth. Not only does tithing fund churches and other buildings, but it also is used for charitable work.
Most importantly, perhaps, is the effect that tithing has upon the giver. It increases our faith and helps us to overcome
selfishness. Furthermore, it is a critical component of prosperity; we are promised a host of temporal blessings when we
obey this law.
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You may be wondering why, considering the nature of tithing, we place it in the third phase, rather than in the first. While we
do stress a sequential order to the Prophetic Model, there are many elements that must be in place and that must be
executed throughout the process and within every phase. Tithing, of course, is one of them.
Tithing underlies and supports every phase. It is how we prove that our hearts
are centered on the proper ideals (phase one). We learn from Malachi that tithing
is a form of spiritual “fire insurance,” and is thus an aspect of phase two. The
last three phases (career, productivity, blessings) lead to increases from which
we can donate more to the Lord’s work.
We have placed it in this third phase of management to signify that it is an
ongoing duty, a law that ties all other financial laws and counsel together, and a
law that must be lived throughout every phase.
Tithing underlies and supports every phase. It is
how we prove that our hearts are centered on the proper ideals (phase one).
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Live Within Your Means
N. Eldon Tanner quoted President Grant who said, “If there is any one thing that will bring peace
and contentment into the human heart, and into the family, it is to live within our means. And if
there is any one thing that is grinding and discouraging and disheartening, it is to have debts and
obligations that one cannot meet.” Elder Tanner added, “How blessed is he who learns to spend
less than he earns and puts something away for a rainy day.”
Righteous stewards spend less than they earnand live within their means.
Living the gospel means to overcome the natural man. Conquering the lusts of the pocketbook is
just as important as conquering the lusts of the flesh.
Marvin J. Ashton taught us to learn self-discipline and self-restraint in money matters. N. Eldon Tanner counseled us to
distinguish wants from needs. L. Tom Perry taught that wealth, prosperity, and abundance are the natural consequences of
temperance, frugality, industry, and restraint of appetites.
Righteous stewards spend less than they earn and live within their means. (We’ll also learn the importance of increasing our
means in phase six.)
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Use a Budget
Marvin J. Ashton counseled, “Every family must have a predetermined understanding of how much money will be available
each month and the amount to be spent in each category of the family budget. Checkbooks facilitate family cash
management and record keeping. Carefully record each check when written, and balance the checkbook with the monthly
bank statement.”
Using a budget helps us to stay disciplined, ensures that we spend less than we earn, and also provides a system of
accounting.
It’s interesting to note the integral connection between tithing and accounting; how can we pay an honest tithe if we don’t
account for our income and expenses properly?
Work Towards Home Ownership
Marvin J. Ashton taught that, “Home ownership qualifies as an investment, not consumption. Buy the type of home your
income will support. Improve the home and beautify the landscape throughout the period you occupy the premises so if you
do sell it, you can use the accumulated equity and potential capital gain to acquire a home more suitable to family needs.”
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In contrast to renting, home ownership provides equity, appreciation, and tax advantages. It gives us greater control, which
can lead to greater financial blessings.
Honor Your Financial Obligations
“…Latter-day Saints who ignore or avoid their creditors,” warned Marvin J. Ashton, “are entitled to feel the inner frustrations
that such conduct merits, and they are not living as Latter-day Saints should! Bankruptcy should be avoided, except only
under the most unique and irreversible circumstances, and then utilized only after prayerful thought and thorough legal and
financial consultation.”
Honesty is a foundational principle of the gospel. In order to gain a temple
recommend we must certify that we are honest in our dealings with our
fellowman. We cannot expect to prosper if we dishonor financial contracts
and obligations.
We cannot expect to prosper if we dishonor financial
contracts and obligations.
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Manage Debt
Joseph F. Smith instructed, “Keep your possessions free from debt. Get out of debt as fast as you can, and keep out of debt,
for that is the way in which the promise of God will be fulfilled to the people of his Church, that they will become the richest
of all people in the world.” Heber J. Grant also counseled, “From my earliest recollections, from the days of Brigham Young
until now, I have listened to men standing in the pulpit…urging the people not to run into debt; and I believe that the great
majority of all our troubles today is caused through the failure to carry out that counsel.”
Our studies revealed the following elements of proper debt management:
1. Stay out of debt where possible, and get out of debt as quickly as possible when it is necessary to incur debt,
including a home mortgage. As J. Richard Clark put it, “Borrow only what you must, at the lowest rate available, for the
shortest time possible.” (See also Earthly Debts, Heavenly Debts by Joseph B. Wirthlin.)
2. Buy consumer durables with cash (see One For the Money by Marvin J. Ashton). Another way to put this is never
borrow to consume.
3. Appropriate uses of debt include buying a “modest” home; education; a “needed first car”; “vital investments”; sound
business debt, which should always be fully secured; and “other forms of ‘secured’ debt.”
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Note that the counsel isn’t that all forms are borrowing are bad, which is a
common misconception. As Marvin J. Ashton said, “Debt in itself is neither good
nor bad. It is a financial tool with the potential of being either. Debt in business
may be used to increase productivity or aid in expansion. However, most
individuals in debt are usually average people, but they are temporarily out of
financial control. They are the victims of poor monetary habits and often have no
idea of the importance of proper money management. They misuse credit, especially credit cards, and don’t live within
budgets or wise operational guidelines.”
It’s incontrovertible that the prophets teach that we should never use debt to purchase consumer goods. Where it gets
complex is in determining which investments are appropriate to go into debt for. The Lord leaves the decision up to us
individually, but it is abundantly clear that borrowing to produce is completely acceptable. Of course, principles of
righteousness, such as temperance, prayer, and being in tune with the Spirit should be used to help us make such decisions.
the counsel isn’t that all forms are borrowing are bad, which is a common
misconception.
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Invest Wisely
Investing is what we do with our surpluses, or our income that exceeds our expenses. Marvin J.
Ashton provides thorough counsel on how to invest wisely, which includes doing due diligence
on all investment opportunities, seeking counsel from experts, and investing with integrity.
Of course, we cannot invest unless we have first saved. As N. Eldon Tanner said, “After…basics
are met, we should by frugal management regularly save to create funds for investment. It has
been my observation that few people have been successful with investments who have not first
developed the habit of saving regularly. This requires discipline and discriminating judgment.
There are many ways to invest. My only advice is to choose wisely your investment counselors.
Be sure they merit your confidence by maintaining a successful investment.”
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Phase 4: Choose the Right Career“Every principle of the gospel, when lived, has a positive influence over your choice of an occupation and on what you
will achieve…Living the gospel will give you a perspective and an inspiration that will see you successful however
ordinary your work may be or however ordinary your life may seem to others. God bless the members of this Church,
that you can be happy with who you are and where you are, that you can improve yourselves.”
- Boyd K. Packer
While He does leave the specific choice up to us, the Lord,
through His prophets, has provided very clear guidelines for
choosing our careers, which include the following:
1. Choose a career that will allow you to be self-reliant.
2. Choose a career that will require you to stretch to
your full potential.
3. Always strive for excellence in your workmanship.
4. Make education a continuing process.
5. Choose a career that allows you to fully live the gospel
and not compromise your standards.
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Self-Reliance
Living the gospel leads to freedom, financial and otherwise. The price of freedom is responsibility. Economic self-reliance is,
therefore, a gospel principle. As Heber J. Grant declared, “Nothing destroys the individuality of a man, a woman, or a child as
much as the failure to be self-reliant.”
Marion G. Romney stated clearly, “The practice of coveting and receiving
unearned benefits has now become so fixed in our society that even men
of wealth, possessing the means to produce more wealth, are expecting
the government to guarantee them a profit. Elections often turn on what
the candidates promise to do for voters from government funds. This
practice, if universally accepted and implemented in any society, will make
slaves of its citizens. We cannot afford to become wards of the government, even if we have a legal right to do so. It requires
too great a sacrifice of self-respect and in political, temporal, and spiritual independence…We should strive to become self-
reliant and not depend on others for our existence.”
“Nothing destroys the individuality of a man, a
woman, or a child as much as the failure to be self-reliant.”
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Achieve Your Full Potential
We learn from J. Richard Clarke, “To work below our capabilities creates a deep
hunger in ourselves and enormous waste in society. Our doctrine of eternal
progression certainly encompasses our occupational progress. Each of us should
be on a career path which will require us to stretch to our full potential.”
Excellence
J. Richard Clarke further taught, “Our labor should be honest labor and quality
labor. The only honorable way for each of us to share in the world’s wealth is to
exchange our own goods and services for those produced by someone else. The
Saints would be in demand everywhere and could command premium
compensation if we would accept the challenge to set a Mormon standard of
quality, unique because of its excellence. This is part of our religion.”
“The Saints would be in demand everywhere and
could command premium compensation if we
would accept the challenge to set a
Mormon standard of quality, unique because of its excellence. This is
part of our religion.”
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Education
Education in large part determines our career path and success. Marvin J. Ashton counseled us to, “Complete as much
formal, full-time education as possible. This includes the trade schools. This is money well invested. Use night school and
correspondence classes to further prepare. Acquire some special skill or ability that could be used to avoid prolonged
unemployment. In these days of worldwide heavy unemployment, we should not allow ourselves, when we are out of work,
to sit back and wait for ‘our type of job’ if other honorable interim employment becomes available.”
Maintain Gospel Standards
Living the gospel extends to how we earn our daily bread. As Dallin H. Oaks taught, “Followers of Christ have the moral
responsibility of earning their livings and conducting their financial transactions in ways that are consistent with the principles
of the gospel and the teachings of the Savior. Members of The Church of Jesus Christ of Latter-day Saints should not be
involved in employment or other activities upon which they cannot conscientiously ask the blessings of the Lord.”
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Phase 5: Increase Your Productivity“Is it possible that our members are becoming part of a ‘conspiracy for mediocrity’ by being content with their present
knowledge and skills?”
- J Richard Clarke
The process of eternal progression extends to every detail of our lives, including personal finance. Keeping in mind the ideals
of phase one, our desire should be to constantly increase our usefulness to the world, to increase our ability to serve at ever
higher levels.
Righteous productivity is the process of learning how to create as much value for as many people as possible. It is striving to
achieve excellence. It means to develop our natural gifts to their fullest potential.
There are four main aspects of productivity from a gospel perspective, as discovered in our research. These are the following:
1. The essence of productivity is service.
2. Increasing production is more important than decreasing expenses.
3. Our production must always exceed our consumption.
4. Strive to understand and cope with inflation.
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Service
Franklin D. Richards taught, “…one might properly say, ‘What I am worth is what I am
doing for other people.’” Marion G. Romney said, “Service is the very fiber of which an
exalted life in the celestial kingdom is made…How can we give if there is nothing there?
Food for the hungry cannot come from empty shelves. Money to assist the needy
cannot come from an empty purse. Support and understanding cannot come from the
emotionally starved. Teaching cannot come from the unlearned. And most important
of all, spiritual guidance cannot come from the spiritually weak.”
The more productive we are the more we can serve. The more we develop our talents
the more lives we can bless and the more we prosper.
Focus on Increasing Production
J. Richard Clarke counseled, “In order to balance our personal income and expenditures, we obviously reduce expenses or
increase our earnings. Too often, however, people find it easier to adjust to a tighter budget than to find ways to generate
additional income.”
The more productive we are the more we can serve. The more
we develop our talents the more lives we can bless and the
more we prosper.
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The implication, of course, is that it’s more important to focus on increasing production than it is to focus on decreasing
expenses. We learned in phase three, Financial Management, that money management should take precedence over
productivity. These two principles may appear to conflict, until we realize that management does not necessarily imply
decreasing expenses, despite the common perception.
Produce More Than You Consume
To quote J. Richard Clarke again, “Consumption should never exceed our
production. Economic freedom comes from the surpluses we create.”
Consuming more than we produce is a sure road to insolvency, bankruptcy,
and bondage. The only way it is possible is to incur consumer debt.
Consuming more than we produce is a sure road to insolvency, bankruptcy, and bondage.
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Cope With Inflation
Inflation, of course, means that the currency is being devalued as the government prints fiat money and/or adjusts the
fractional reserve rate.
James E. Faust recognized that “Unemployment and inflation can quickly wipe away hard-earned savings.” Marvin J. Ashton
taught, “Strive to understand and cope with existing inflation. Learn to see through the money illusion and recognize the real
value of money. Most wage earners today have less purchasing power than they did [a few years ago]. To some degree
inflation is probably going to be with us for a long time. Realize that you are living in a new era of higher prices and less
abundant energy.”
Increasing productivity is how we stay ahead of inflation.
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Phase 6: The Blessings of Financial Obedience
Phase 6: The Blessings of Financial Obedience
“When the lives of the people are in harmony with the Lord’s will, all of the essential factors that produce the blessings
God deigns to give to his children seem to come into line. Love and harmony prevail. Even the weather, the climate,
and the elements seem to respond. Peace and tranquility endure. Industry and progress mark the lives of the people.”
- Dean L. Larsen
“It has always been a cardinal teaching with the Latter-day Saints, that a religion which has not the power to save
people temporally and make them prosperous and happy here, cannot be depended upon to save them spiritually, to
exalt them in the life to come.”
- Joseph F. Smith
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Obeying God’s laws of personal finance is core to the
gospel of Jesus Christ. How we spend our time and
money indicates where our hearts are and our level of
obedience to all of God’s commandments.
Living the gospel requires financial obedience. In fact,
once the integral connection between the gospel and
finance is understood, we realize that they are one and
the same. The blessings of obedience include the
following:
1. Material Wealth
2. Spiritual Freedom and Confidence
3. Unity Within Our Families and the Church
4. Peace, Joy, Health, Happiness, Wisdom and Fulfillment
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Material Wealth
Dean L. Larsen taught, “The Lord has demonstrated throughout
the generations that when the inhabitants of the earth remember
him and are obedient to his direction, he will bless them not only
with spiritual blessings, but with material abundance as well. The
scriptures contain many evidences of the Lord’s willingness to
prosper his people with the riches of the earth when they
demonstrate that they will use this abundance prudently, with
humility and charity, always acknowledging the source of their
blessings.”
Marvin J. Ashton added, “We can’t afford to neglect personal and family involvement in our money management. God will
open the windows of heaven to us in these matters if we will but live close to Him and keep His commandments.”
“The Lord has demonstrated throughout the generations that
when the inhabitants of the earth remember him and are obedient to his direction, he will bless them not
only with spiritual blessings, but with material abundance as well.”
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Spiritual Freedom and Confidence
Joseph F. Smith taught, “Get out of debt and keep out of debt, and then you will be financially as well as spiritually free.”
Mark E. Petersen said, “Let us remember that it is against the will of God that any one of us should be in bondage—in any way
—neither to sin nor to addiction nor to debt. ‘Ye shall know the truth, and the truth shall make you free’ (John 8:32), He
declared—free from sin, free from addiction of all kinds, and free from the slavery of debt. His truth, which is His gospel, will
make us free—if we obey Him!”
David O. McKay stressed, “It is something to supply clothing to the scantily clad, to furnish ample food to those whose table
is thinly spread, to give activity to those who are fighting desperately the despair that comes from enforced idleness, but after
all is said and done, the greatest blessings that will accrue from the Church [welfare program] are spiritual. Outwardly, every
act seems to be directed toward the physical: re-making of dresses and suits of clothes, canning fruits and vegetables,
storing foodstuffs, choosing of fertile fields for settlement—all seem strictly temporal, but permeating all these acts, inspiring
and sanctifying them, is the element of spirituality.”
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Unity Within Our Families and the Church
N. Eldon Tanner warned that, “Overindulgence and poor money management place a
heavy strain on marriage relationships. Most marital problems, it seems, originate
from economic roots—either insufficient income to sustain the family or
mismanagement of the income as earned.” Financial obedience eliminates much of
the stress of marriage and facilitates unity within marriages and families.
L. Tom Perry challenged, “…we can tell whether or not we put the kingdom of God
first by looking at how we treat our brothers and sisters in the Church. Is there a
special bond uniting us? Is there an absence of envy and backbiting? Do we rejoice in the success of a brother or sister as
much as in our own? Do we share our substance so that all may be rich like unto us? Ultimately, are we our brothers’ and
sisters’ keepers? May each of us accept the challenge to seek the kingdom of God first, before and above all else, and by so
doing draw closer together as a people, until we are all of one heart and one mind…”
Financial obedience eliminates much of the stress of marriage and facilitates unity within
marriages and families.
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Peace, Joy, Health, Happiness, Wisdom, and Fulfillment
We learn in Doctrine and Covenants 59:23, “But learn that he who doeth the works of righteousness shall receive his reward,
even peace in this world, and eternal life in the world to come.”
N. Eldon Tanner taught, “The payment of tithing is a commandment, a
commandment with a promise. If we obey this commandment, we are promised
that we will ‘prosper in the land.’ This prosperity consists of more than material
goods—it may include enjoying good health and vigor of mind. It includes family
solidarity and spiritual increase. I hope those of you presently paying your full tithe
will seek the faith and strength to do so. As you discharge this obligation to your
Maker, you will find great, great happiness, the like of which is known only by
those who are faithful to this commandment.”
Heber J. Grant counseled, “If there is any one thing that will bring peace and contentment into the human heart, and into the
family, it is to live within our means. And if there is any one thing that is grinding and discouraging and disheartening, it is to
have debts and obligations that one cannot meet.”
If there is any one thing that will bring peace and
contentment into the human heart, and into the family, it is to live
within our means.
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Joseph B. Wirthlin said, “Obedience to God’s commandments is the foundation for a happy life. Surely we will be blessed with
the gifts of heaven for our obedience. Failure to pay tithing by those who know the principle can lead to heartache in this life
and perhaps sorrow in the next.”
“One of the greatest lessons I have learned,” said James E. Faust, “…is that people who pay their tithing in both difficult times
and good times get along better. They simply have fewer problems; there are fewer family problems and fewer financial
problems. Their outlook is more positive, their ability to do and function is increased, and they prosper spiritually as well as
temporally.”
Elder Faust also added, “One of life’s paradoxes is that a person who approaches everything with a what’s-in-it-for-me
attitude may acquire money, property, and land, but in the end will lose the fulfillment and the happiness that a person
enjoys who shares his talents and gifts generously with others.”
Gordon B. Hinckley taught, “There are many ways in which the Lord can bless us beyond the riches of the world. There is the
great boon of health. The Lord has promised that he will rebuke the devourer for our sakes. Malachi speaks of the fruits of
our ground. May not that rebuke of the devourer apply to various of our personal efforts and concerns? There is the great
blessing of wisdom, of knowledge, even hidden treasures of knowledge. We are promised that ours shall be a delightsome
land if we will walk in obedience to this law.”
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ConclusionNow that you’ve explored each individual phase, it’s helpful to see the complete model once again, this time with a more
enlightened view.
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Phase 1: Foundational Ideals• Seek first the kingdom of God.• Use money to achieve eternal happiness.• Love your neighbor as yourself.
Phase 2: Prepare & Protect• Have adequate insurance.• Save a percentage of your income.• Have a food and fuel storage program.• Preserve and utilize your assets through appropriate
tax and estate planning.
Phase 3: Financial Management• Pay an honest tithe.• Live within your means.• Use a budget.• Work towards home ownership.• Honor your financial obligations.• Manage debt appropriately. • Invest wisely.
Phase 4: Choose the Right Career• Choose a career that will allow you to be self-reliant.• Choose a career that will require you to stretch to your full
potential.• Always strive for excellence in your workmanship.• Make education a continuing process.• Choose a career that allows you to fully live the gospel and not
compromise your standards.
Phase 5: Increase Your Productivity• The essence of productivity is service.• Increasing production is more important than decreasing
expenses. • Our production must always exceed our consumption.• Strive to understand and cope with inflation.
Phase 6: The Blessings of Financial Obedience• Material wealth.• Spiritual freedom and confidence.• Unity within our families and the church.• Peace, joy, health, happiness, wisdom, and fulfillment.
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In a time of national financial crisis, the prophetic counsel regarding personal finance is particularly relevant and crucial.
Latter-Day Saints across the nation and throughout the world feel an urgency to heed prophetic counsel and prepare for
difficult times.
We hope that by illuminating these truths others will be inspired to return to foundational truths and practices that may have
been neglected in times of ease and plenty. We hope that you have been blessed with an increased ability to discern truth
from error as you strive to prosper.
Ultimately, we hope that you are filled with confidence and security as you implement the timeless, universal, and profound
financial principles taught by God through His prophets. And as you do so, may you become a pillar of strength, a beacon of
light, and a source of aid and comfort in a desperate world.
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Recommended Conference Talks & Ensign Articles
1. Constancy Amid Change by N. Eldon Tanner
2. Guide to Family Finance by Marvin J. Ashton
3. The Use & Abuse of Blessings by Brigham Young
4. Thrift: The Foundation of Prosperity by Joseph F. Smith
5. The Household of Faith by J. Richard Clarke
6. Earthly Debts, Heavenly Debts by Joseph Wirthlin
7. Personal and Family Financial Preparedness by Franklin
D. Richards
8. Providing For Our Needs by M. Russell Ballard
9. It’s No Fun Being Poor by Marvin J. Ashton
10. Blessings in Self-Reliance by Mark E. Peterson
11. The Celestial Nature of Self-Reliance by Marion G.
Romney
12. The Lord Will Prosper the Righteous by Dean L. Larsen
13. The Times in Which We Live by Gordon B. Hinckley
14. Doing the Best Things in the Worst of Times by James E.
Faust
15. Greed, Selfishness, and Overindulgence by Joe
Christensen
16. Tithing: An Opportunity to Prove Our Faithfulness by
Gordon B. Hinckley
17. What’s In It For Me? by James E. Faust
18. Brother’s Keeper by Dallin H. Oaks
19. The Law of Abundance by Franklin D. Richards
20. The Gospel: The Foundation of Our Career by Boyd K.
Packer
21. This is No Harm by Marvin J. Ashton
22. The Father’s Duty to Foster the Welfare of His Family
by H. Burke Peterson
23. The Perfect Law of Liberty by Marion G. Romney
24. But Be Ye Doers of the Word by L. Tom Perry
25. Watch, That Ye May Be Ready by Harold B. Lee
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26. United In Building the Kingdom of God by L.Tom Perry
27. As a Man Soweth by L. Tom Perry
28. The Tragic Cycle by Marion D. Romney
29. “Beware Lest Thou Forget the Lord” by Dean L. Larsen
30. “For Whatsoever a Man Soweth, That Shall He Also
Reap” by L. Tom Perry
31. Becoming Self-Reliant by L. Tom Perry
32. “Give With Wisdom That Ye May Receive With Dignity”
by Marvin J. Ashton
33. The Blessings We Receive as We Meet the Challenges of
Economic Stress by James E. Faust
34. Guiding Principles of Personal and Family Welfare by
Thomas S. Monson
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