Investment – Crown Financial Ministries New Zealand

Setting up an emergency savings account

Peter Crawford — Sat, 26 Jul 2025 05:40:55 +0000

An emergency savings account is a primary element of a financial plan. Having money set aside and always available for the unexpected expenses eliminates a lot of financial stress and the need to rely on credit cards or other forms of short-term debt.

How Much Do You Need?

An emergency savings account is a source of money to draw on during unexpected circumstances. It is basically an insurance fund for sudden setbacks. This might include a job loss, having to stop work due to major health issues, major car or home repairs, a natural disaster, an unforeseen tax bill, a death in the family, or emergency travel expenses.

The alternative of income replacement insurance is expensive, and you are not always guaranteed a payout. If you don’t make any claims on your insurance, you don’t receive any money back, but if you consistently save for emergencies, you will eventually have more than you need and be earning money on your savings.

Most experts recommend saving three to six months of your current living expenses, but these are some scenarios where you might want to save more:

Those with children who are still dependent on you.
If you have a mortgage.
If layoffs are common in your industry
If you are retired and don’t have other sources of income.
If you are self-employed or your income is unstable.
Single parents without a second source of income.

If you spend less than you earn, have no dependents, and no debt you can keep fewer months of living expenses in emergency savings.

A portion of the emergency savings should be easily accessible, in accounts that won’t be penalized for withdrawals.

You need to be able to cover rent or mortgage, utilities, insurance (car, home, life), routine maintenance (car and home), groceries, child-care, and other debt payments. Find the total monthly cost of these items and multiply that by three to calculate a three-month saving goal; multiply by six to determine what is needed to cover six months. This total is for basic survival—discretionary items are not included (the things that are nice, but you can survive without them). This is money needed to survive if the unexpected hits.

How to Start

Open an account that you absolutely will not touch unless a true emergency arises. Aim to save $1,000 as quickly as possible. Set up automatic payments so you will not spend the money. Deposit gifts, pay raises, bonuses, or tax refunds when possible. Go through your bank and credit card statements to see where you can cut expenses and divert that money toward an emergency savings account until you establish a three-to-six-month cushion. When you need to withdraw money, aim to replenish it.

Lessons from Ants

Go to the ant, O sluggard; consider her ways, and be wise. Without having any chief, officer, or ruler, she prepares her bread in summer and gathers her food in harvest. Proverbs 6:6–8

Not only are ants extremely busy creatures, but they are also known for their ability to store food that is ultimately shared with others in their colony. Most of us have seen an ant carrying off a large breadcrumb under the picnic table. They are not feasting on the bread; they are harvesting it for use in the future. This is the wisdom that God wants us to learn from.

What about debt repayment?

If you have debt, repaying that debt as fast as you can is a priority. You will be in a much stronger financial position once you are debt free. Make a commitment to take on no new debt.

If you don’t have much room in your spending plan for savings, saving $5 or $10 a week is still a good starting point for your emergency savings account.

Set a goal; then challenge yourself with spending fasts, like a no-eating-out month, a no-entertainment-expense month, etc. Find friends to do this with you; some competition may help you build your savings account faster!

How many savings accounts do you need?

Once you hit your goal for your emergency savings account, consider opening another bank account for future needs. This might include replacing a vehicle, necessary maintenance on your home, investing in more insulation for your home, installing solar panels, buying a home, holidays, and more.

Summary

At least three savings accounts plus your KiwiSaver are useful:

Short-term expenses that don’t occur every month. That includes annual holidays, dentist and vehicle servicing
Long-term savings for buying a house, home improvements, car replacement and major holidays
Emergency savings for unexpected events

The article next month addresses how to maintain these savings accounts.

Six money myths you need to stop believing

Peter Crawford — Tue, 27 Aug 2024 04:35:41 +0000

There are many misconceptions and myths about money. Many are completely untrue, but some need to be seen through the lens of a faithful, biblical steward. Here are the top six money myths and a biblical perspective.

Myth 1 – Investing is the same as gambling, so as a Christian I shouldn’t invest.

Investing is not unscriptural. In the Parable of the Talents in Matthew 25, each man receives according to their abilities and is directed to manage their portions well. Each steward was then rewarded or punished based on how he used the money given to him.

Investing is also different than gambling. When you gamble, someone else has to lose in order for you to win. It’s the ultimate get-rich-quick scheme that preys on the poor and motivated by greed and covetousness.

An important distinguisher is between investment performance and investment purpose. Performance will vary based on our response to constantly changing factors beyond our control. Increased knowledge and discipline should lead to increased skill and better investment performance.

Investment purpose is a matter of intent. As you learn to invest money according to God’s principles, you’ll find that God will increase your opportunity to help other people. The true purpose of godly investing is to increase your assets so you can serve God more fully. If you are simply multiplying your money and storing your assets without a purpose, you’ll be guilty of hoarding, like the rich fool in Luke 12.

Myth 2 – I don’t need a savings account because I have a credit card.

This is a surefire way to get into debt. A savings account is crucial because you can’t always plan for emergencies and the unexpected in life. Instead of charging unexpected bills such as car repairs and home improvements on your credit card, dip into your savings and avoid debt altogether. The Bible doesn’t prohibit borrowing, but it does discourage it.

Myth 3 – I don’t need to pay my credit card off in full every month because I am building my credit.

A very common myth is that credit card companies want to see your ability to pay off balances steadily and over time. But this doesn’t do anything for your credit score! It just prolongs the amount of time you’re in debt and the amount of interest you are paying. If you use a credit card for cash back rewards or airline miles points, pay it off in full every single month. Commit to not be in debt, even if it’s for a short period of time.

Myth 4 – Buying a house is better than renting.

When you buy a house you are investing in a property that should increase in value over time. But for some people, renting may be a better option. This could be for a variety of reasons:
• if you expect to move in the near future,
• if you have a busy lifestyle that prevents you from taking care of home maintenance and landscaping,
• if you don’t have enough money to make a sufficient deposit payment on a house, and
• if you don’t have enough income to pay your mortgage off in less than 30 years.

Once you have a mortgage, it increases your access to debt. Some people borrow more against their house as it increases in value. While that may be cheaper debt for financing purchases, the additional interest you pay is significant.

The most common complaint about renting is that you’re just “throwing away money”. However, that doesn’t recognise the costs the landlord faces for rates, insurance, repairs and maintenance. Key factors in working out whether home ownership is better than renting are:

• how long you take to pay off your housing debt
• how much house prices increase compared with your income

Look online for rent vs buy calculators to see what the best option for you is.

Myth 5 – I don’t earn enough money to have a budget.

You should have a budget no matter how much money you earn. But if you live from one pay to the next or find that money is tight, it is vital for you to stick to a budget. Recording your spending allows you to know exactly where all your money is going so you can control it, instead of it controlling you.

Myth 6 – I’m young so I don’t need to worry about saving for retirement yet. OR I’m old so it’s too late for me to start saving for retirement.

Neither of these myths could be further from the truth. If you’re young, now is the most important time to start planning and saving for retirement. Compound interest is a beautiful thing that works for you…if you give it time.

And it’s never too late to start saving for retirement. It would be better to have something saved for retirement than nothing at all. Even if you can live on New Zealand Superannuation alone, when you have savings, you can leave an inheritance for family or a gift to your church or ministry. Stewardship is about managing your life in a way that gives you the freedom to do what God has called you to. If you’re stressed or anxious about money, surrender your circumstances to the Lord and ask Him for direction.

Should I invest in Bitcoin or other cryptocurrencies

Peter Crawford — Mon, 01 Nov 2021 07:24:08 +0000

Should I invest in Bitcoin or other cryptocurrencies?

What are cryptocurrencies?

Cryptocurrency is a type of money that’s digital and can be used to buy and sell things, usually online. However, its potential to store and grow value in has resulted in interest from investors looking for other ways of earning income faster.

The New Zealand Financial Markets Authority website notes cryptocurrencies are not legal tender (money that must be accepted as payment) in most countries and do not exist physically as notes and coins. They are also not viewed as financial products so are not regulated in New Zealand. There are over thousands of different cryptocurrencies available on the internet, with Bitcoin one of the more well-known currencies.

When you buy cryptocurrency, it is held in a ‘digital wallet’. It can be used to buy goods or services from anyone willing to accept it. Cryptocurrency trading platforms enable you to buy and sell cryptocurrency and some allow you to convert it back into money (like New Zealand dollars) at any time, if someone is willing to buy it.

People buy or use cryptocurrencies to:

make a profit if the cryptocurrency increases in value,
make payments directly without going through the banking system,
benefit from lower (usually zero) transaction fees compared with traditional banks and other online payment processes when purchasing goods and services,
invest in a business or individual raising money through an Initial Coin Offer (ICO).

Understanding the risks

Banks charge fees when you are making payments overseas, so cryptocurrencies are seen as a cheaper option. However, many overseas cryptocurrency exchanges are unregulated and operate exclusively online – with no connection to New Zealand. This makes it hard to find out who is offering, exchanging, buying or selling it. It also makes it unlikely you’ll recover your money if things do go wrong with your overseas payment.

Using cryptocurrencies may make you a target for scammers or businesses selling high-risk investments.

Things to look out for

Cryptocurrency value can change quickly

There many cryptocurrencies available. If one becomes popular its value may increase quickly, but its value can also suddenly drop, sometimes permanently.

The risk increases if you invest in the futures market through contracts for differences where you make (or lose) money by predicting how the price of cryptocurrencies might change. These products are typically offered with leverage (the use of debt) – you may only pay a portion of the value of your trade upfront but if you lose, you have to repay the full amount borrowed, plus any amount you’ve lost. Even small movements in currency values can have a big impact on any gains or losses you make.

Your ‘coins’ may be stolen

All online transactions are at risk of cyber-crime. The cryptocurrency in your digital wallet can be stolen just like the money in your real wallet – with very little chance of it being returned. Cryptocurrency marketplaces and trading platforms can also be at risk of cyber-attack.

CERT NZ has some great information on ways you can keep your digital wallet more secure.

Cryptocurrencies aren’t widely accepted

Cryptocurrencies have less practical value than money which can be used to buy all goods and services.

Make sure any New Zealand platform you use:

is registered on the Financial Service Providers Register (FSPR),
is a member of a dispute resolution scheme, and
holds your New Zealand dollars in a trust account.

Know what you’re getting into, including how the currency is stored and transferred, and how to get your money back.

Store your login details securely. If you forget them or enter your details incorrectly, you may not be able to access your money permanently.

Understand how to access a payment record. You may need to prove you’ve made a payment – to get a refund for example.

What does the Bible say about investing?

“Don’t wear yourself out trying to get rich. Be wise enough when to quit. In the blink of an eye wealth disappears, for it will sprout wings and fly away like and eagle.” (Proverbs 23:4-5 NLT)

“Teach those who are rich in this world not to be proud and not to trust in their money, which is so unreliable. Their trust should be in God, who richly gives us all we need for our enjoyment. Tell them to use their money to do good. They should be rich in good works and generous to those in need, always being ready to share with others. By doing this they will be storing up their treasure as a good foundation for the future so that they may experience true life.” (1 Timothy 6:17-19 NLT)

There are better, more stable opportunities for investing. If you think you want to own a cryptocurrency, start small, and be prepared to lose it all.

Acknowledgement – a significant portion of the content of this article was sourced from the New Zealand Financial Markets Authority website. For further information on cryptocurrencies and warnings issued by the FMA go to www.fma.govt.nz.

Peter Crawford