brown on green Living Your Financial Creed Brown on Green is a regular column written by Free Will Baptist Foundation Director David Brown. The column offers financial advice, addresses hot-button business topics, and answers your finance questions. Contact David with your anonymous question: david@nafwb.org.

A recent Fortune magazine article focused on Johnson and Johnson, the consumer products, pharmaceutical, and medical devices company. They’ve had a remarkable run since their founding in 1886. Sales have not declined in 76 years, profits have not declined in 25 years, and their dividend has risen for 46 years in a row. Last year, while the American economy was in drastic decline Johnson and Johnson’s sales increased by 4.3%. The 500 largest companies in America saw their profits drop 85% last year, but the profits of this remarkable corporation were up 22%.

The Company has managed to do this without a lot of fanfare or headlines. Why am I drawing attention to Johnson and Johnson? Certainly not to recommend a stock pick (analysts believe both sales and profits will decline in 2009) but to observe a couple reasons why they have been so resilient through the years. They have developed an outstanding creed to guide their company and—more important— they actually follow their creed.

Johnson and Johnson’s remains focused on the long view. Many corporations that are struggling through the current economic crisis have focused only on the short term. Following no creed but greed is not good for any company in the long term. This is true for Christian individuals as well. We need to follow a financial creed—the principals regarding money laid out in God’s word.

What is this financial creed?

• Live within your means.

• Don’t take on extreme debts.

• Give back to God at least 10% of your income and assets; just to name a few.
  

The overriding principle is simple. Take the long view. Don’t lose sight of retirement and other long-term goals. Avoid making long-term financial decisions based on short-term information.

Good financial planning can bless many generations in the future, a lesson we can learn Johnson and Johnson—123-years-old and thriving.

How to Teach Your Children About Money

Start early. Children should start learning as soon as possible.

Use an Allowance. Require work (chores) for pay.

Hands-on. Involve them in household finances. Show them where money goes.

Let them get a job. Part-time employment will teach them how to function in the workforce.

Lead by example. Don’t expect your kids to be good stewards unless you are

Teach them the 70-20-10 rule:

• 70% for living expenses

• 10% for the Lord

• 20% for savings

  -10% retirement

  -5% emergency savings

  -5% long term purchases