Cashing In With Ellie Kay

0 comments Posted on May 2, 2012

Learn how to build a biblical (and better) budget

by Andrea Stock, editor of

When Ellie Kay promised Bob, her now macho-man, fighter pilot husband of 22 years, for rich or for poor, she meant it. On Ellie’s wedding day, she said ‘I do’ not only to him, but to their combined consumer debt of $40,000!

Never one to shy away from a challenge, Ellie rolled up her financially savvy sleeves; and in two and a half years, Ellie and Bob were living debt free.

So how did they do it?

THE 10/10/80 RULE™
“The very first thing that we did was decide to get our finances in biblical order,” Ellie shares. “And that meant putting the first 10% to tithe, the next 10% to savings and then the last 80% was spent wisely.”

Additionally, any extra money that came in (i.e. overtime, bonuses, gifts) went toward paying down debt.

Not only were the Kays out of debt in record time (yes, you could call that a miracle), but through this lifestyle overhaul, Ellie also developed the 10/10/80 Rule™—an essential framework anyone can use for building a biblical (and better) budget.

“There’s an old saying in Texas that if you aim at nothing, you’ll hit it every time,” Ellie states. “We have to be able to have a goal and that’s where a spending plan, a budget, comes in. I call it the 10/10/80 budget. And it’s based on the philosophy of giving away the first 10%, saving the next 10% and spending the last 80% wisely.”

Despite popular belief, developing and sticking to a budget doesn’t have to be difficult. A budget is not meant to stifle your spending. It is designed to help steer your spending and create greater control and freedom over your finances.

“People that live on a budget, that establish a budget and actually live on it, don’t have nearly the financial worries that those who don’t have any kind of a plan at all,” Ellie adds.

The problem perhaps lies in the fact that developing a budget doesn’t come naturally.

“First of all, you need to be able to know what percentages to put toward your budget,” Ellie comments. “We’re not born knowing how to put together a budget. So it is a skill that has to be learned.”

That’s where America’s Family Financial Expert® Ellie Kay comes in. She has made money matters palatable and applicable for Mr. and Mrs. America. You can check out her interactive budget tools at or pick up a copy of her twelfth and latest book Living Rich for Less, available at your local Christian bookstore.

“Living Rich for Less is all about helping people create a lifestyle that they want to live, by doing the basics like giving, saving and spending smart,” Ellie explains.

And that’s basically what a budget is—developing a way of life to keep your financial priorities in order, placing sharing first, saving second and spending third.

“I feel like when you put them in that order it fits in better,” Ellie points out. “That’s what makes this approach different from a mainstream financial expert. We’re really stressing the whole idea of sharing, and then saving and then spending.”

Placing your finances in biblical order is the same for everyone, whether you’re living in the land of plenty or the wilderness of want.

“I think that it’s important, like Paul says, that he has learned to be content with little and with much. And I think that’s a basic financial philosophy that we have lived our lives by,” Ellie concedes. “When we first got married, that was the little part. Right now, we’re in the much part. But whether you have little or much, it’s important to keep your financial priorities straight.”

So are you ready to begin building a better budget? Let’s get started.

“The whole idea behind sharing is the idea that the sweetest dollar I ever make is the one I can give away,” Ellie begins. “And when people start to give away 10% of their income, then they find out that the impact that they make on other peoples’ lives and the way it frees up their finances is a very sweet thing that happens to them.”

An illustration Ellie uses in Living Rich for Less is the Dead Sea principle. The reason nothing can live in the Dead Sea is because it has an inlet but no outlet. Ellie explains that the same applies to our finances. Having an income and holding onto it, rather than giving a portion of it, will likewise sap the vitality out of your finances.

When considering where to share, Ellie suggests starting local, “to support God’s work in your community,” and that usually means the church.

“Bob and I are fairly conservative Christians. We’ve never really espoused to a prosperity doctrine. We do believe in the biblical tithe, and so with that in mind, we have lived the abundant life, even in our finances,” Ellie admits.

“I believe that a biblical tithe is 10%,” Ellie remarks. “If you look at the original Hebrew language when it talks about tithes and offerings in the Old Testament, I believe that is an interpretation of 10%. . . . I also understand that the vast majority of people reading this magazine and vast majority of Christians do not tithe 10%. So, what I recommend is that you start where you are and you give what you can.”

Although, Ellie adds that giving 1% leaves you in no better place than where you were before you even considered giving. In this regard, prayerfully consider what the Lord would have you to give and look to His Word for guidance. The Bible addresses much on the topic of giving back to God what He has entrusted to you and giving it joyfully, willingly and sacrificially off the top…not just your leftovers (see Malachi 3:10; Numbers 18:12; Proverbs 3:9; Exodus 25:2).

“We’re an ordinary family, but we serve an extraordinary God,” Ellie encourages. “He allows us to be able to do extraordinary things with material resources.”

Using the 10/10/80 Rule™, the next 10% of the income goes to savings. According to Ellie, “the safest dollar that you ever make is the one that you can put away.”

Somewhat of a calculated risk taker herself (did you know she’s a sky diving, zip lining mother of seven?!), Ellie isn’t deterred by the present economic crisis. Rather she views this as a challenge and lends her readers a helping hand with a few of the following investing tips:

1. Pay off your credit card debit. “The very best investment is to not take your dollars and put them toward a mutual fund, but you take those same dollars and put it toward a credit card that you are paying 21% on. And there’s 21% return on your investment right there.”

2. Keep three to six months worth of living expenses in your savings account. “Three months if you’re duel income, six months if there’s a single income. . . . And that’s bare minimum.”

3. Max out your 401(k)s. “Especially if there is any matching portion in there that’s matched by the employer . . . you’re not going to get that kind of return in the stock market.”

But even given the market’s plunge, according to Ellie, “if you look at the history of conservative investing in the stock market, it will come back. So if you’ve met these other levels of savings and investments . . . and you’re ready to invest in Mutual Funds or the stock market of some kind, then realize that’s still, in the long run, going to be a good investment.”

Finally, the last 80% of the income goes toward spending wisely. Ellie refers to this portion as the smartest dollar that you ever make.

One of the concepts covered in Living Rich for Less is that instead of trying to keep up with the Joneses, you can live like them.

“It used to be that keeping up with the Joneses meant spending like the Joneses, but now the Joneses are saving money. So saving money has become the new cool,” Ellie states.

By spending wisely, a family can stay within their budget and still have nicely furnished homes, family vacations and trendy clothing. Spending wisely doesn’t mean cutting spending; it means conscientious spending.

“One of the things we learned in our early marriage is that very rarely should you have to pay full price for anything, whether it’s a car or a can of corn. There is a cheaper way to buy almost everything that we buy,” Ellie shares. “So spending that 80% wisely means that you find the best value that is available to you. And those values abound. . . . I’m just helping people find them.”

And when it comes to spending wisely, it’s the little things that count.

“Even small changes, when it comes to how we spend our money smartly, can really add up,” Ellie explains. “Driving your car once you paid it off, for one year longer, and taking that amount of money and putting it in a savings account instead can help you on your way toward driving paid for cars, for the rest of your life. Small changes really add up.”

But these minor changes don’t have to crimp your style.

“You [can] still have the kind of lifestyle that you’re looking for but you pay less for it,” Ellie says. “And ultimately, it’s really not about keeping up with the Joneses; it’s about following what living rich means to you. And I think that what the Joneses really want, whether they understand it or not, is not found in living the materialistic rich lifestyle. What they really want is to not argue about money with their spouse, what they really want is to have their house paid for by the time they retire, what they really want is to be able to put their kids through college with minimal student loans, what they really want is to get out of consumer debt. That’s living rich.”

So living rich doesn’t mean living less. In fact, it’s just the opposite. Living rich means becoming a wise steward of the money God has given you and cashing in on the abundant life.

“It is a fairly radical concept that we’re crossing over into mainstream America with, but one I believe God will honor and help people by getting their finances in order,” Ellie concludes. “That’s the amazing thing about biblical stewardship is that it works, and it works whether you’re a Christian or not. People that spend less than what they make, people that give away part of their income, people that save on a regular basis, people that spend smart, their finances are going to work out. It’s just one of those things that God has created to be able to work out.”


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