I wasn’t sure how to respond.
I recently made a new acquaintance at my church who studies and understands financial matters. We were discussing my stewardship pastor role at the church and my use of Dave Ramsey materials for financial instruction.
He told me that he believes Dave spends too much time on the defensive side of money. All he talks about is budgeting, getting out of debt, and emergency funds.
I really couldn’t argue too much with my new friend. He was making a solid point.
In this post, I’ll share a few of the highlights of what I learned.
3 Key Elements I Learned From Reading This Book
Financial Fitness: The Offense, Defense, and Playing Field of Personal Finance by LIFE Leadership Written by Chris Brady and Orrin Woodward
1. I have perhaps spent too much time on the financial defense side of money then the offensive side. Here’s an excellent quote from the book that makes this exact point:
“Most books on personal finance start (and, all too often, end) with a focus on financial defense (how to get out of debt, protect your money, and prepare for contingencies). But defense is the wrong place to start because it creates the wrong mindset. Defense of money is vitally important, but making it the first priority often puts people in an attitude of scarcity rather than abundance. We will cover financial offense (making more money) first and then defense (protecting one’s resources) later because the values and attitudes of financial offense are naturally abundant, aggressive, and bold. Successful financial offense requires initiative, innovation, ingenuity, and tenacity—the entrepreneurial values” (Kindle location 1212).
2. I need to excel in my current job role, and then figure out a side income to throw off passive cash flow. While this wasn’t necessarily a big news flash for me, it was a good reminder for me on how to stay on financial offense. Here are three excellent quotes from this book regarding this point:
“As you truly excel in your current role, you will naturally be given more responsibility, and as you do the same with the new duties, you will build yourself into a better and better leader. This is why the offense side of finances is so important in achieving financial fitness. Whatever you are working on right now in your life, truly excel at it in order to fully invest in yourself. The natural result will be progress and increasing prosperity and opportunities” (Kindle location 1432).
“If you have a job, it means doing the same thing as an intrapreneur—thinking like an entrepreneur, a leader, and an innovator at your work, rather than just fitting in to your job description. It means adopting an ownership mentality, thinking and acting like an owner rather than just settling for an employee mentality. Focus on the owner mentality in your choices, work, interaction with others, and in all tasks, character opportunities, and relationships whether or not you are actually the owner—as an entrepreneur or intrapreneur, or both” (Kindle location 1420).
“One of the key principles of financial fitness is to increase your passive income, even if you continue to work at a primary active income source. Of course, if you are currently employed, don’t quit your job until your passive income has surpassed your active income (and you have sought professional advice, gotten out of debt, done the proper planning, and so forth). As we said earlier, you can keep carrying buckets for your employer, but it is also helpful to begin building your own pipeline of passive income” (Kindle location 1753 ).
3. I need to give more consideration to Emergency Preparation: food, water, power, guns, cash, and precious metals. In my mind, I would think that emergency preparation would fall under the area of financial defense. Brady and Woodard categorize this interestingly enough under financial offense. Here is a lengthy but excellent quote on this topic:
“Saving for a worst case includes the opposite of compounding money, which we will call “impounding.” This means putting away various forms of money just in case catastrophic things happen. Stash some cash in a safe, secure, secret place. And in case inflation ruins the value of the currency, put away some silver coins as well. Silver is better than gold for this purpose because in a worst-case world, gold will be very valuable, so a gold coin will be worth a lot more than the food you will want to buy with it. Small silver coins will be easier to trade for small needs. Gold can be used to effectively protect larger amounts from loss of value due to government inflation (more on this later). Saving for a worst case includes the opposite of compounding money, which we will call “impounding.” By the way, don’t be too extreme about this. We are not doom and gloomers, and we’re not predicting a world with roving bandits and no electricity. It could happen, but so could a lot of things. We are simply suggesting that part of sound money planning is to realize that bank holidays and closed banks can happen. They occurred during the Great Depression, even though the world didn’t end. But people with some cash and silver were able to purchase food and fuel when others could not. And major storms, natural disasters, and other challenges can come also. So be prepared. Don’t be fanatical. Just take some wise precautions. Another valuable investment on this same level is food storage. Get the kind that lasts many years and keep it in a cool, dry place. Many people store guns and bullets with their food and metal coins. Learning to hunt might be a very helpful preparation. Again, this is for last-ditch survival needs, but having it as part of your investment hierarchy can be very valuable” (Kindle location 2323).
Okay, so here’s my recommendation: I highly recommend reading Financial Fitness, especially if you have been down in the trenches with the Dave Ramsey philosophy for a while. I’m not saying that the Dave philosophy is bad, but you can get too immersed in financial defense for too long. This has the potential for developing a financial scarcity mindset, which isn’t where you want to be, long-term.
This book can help you get turned back around to focusing on financial offense, which leads to abundance thinking. I wonder what this world would be like if people had thoughts of abundance rather than scarcity mindsets?
Questions: Have you read Financial Fitness? What were your takeaways from this book? Would you recommend this book to others?