In the world of Christian financial advice there are two big players, Crown Financial Ministries and Dave Ramsay, who launched the Financial Peace University. Each uses God as an advertising tool to engage their Christian followers, and have lots in common. Crown Ministries has been around longer and claims to have helped 50 million people worldwide, in comparison to Dave’s one million. Each encourages saving and debt reduction as the route to financial freedom, and promotes the concept of tithes.
They each offer a financial planning program of remarkable similarity; sell products on their websites; and host radio shows. Dave is well known for his ‘Baby Steps’ program to tackle debt whilst Crown Financial Ministries offers the ‘Money Map’. Each promote the envelope system of dealing with spending, and both rely heavily on the Bible as a source of financial advice. It’s thus not surprising to hear that Ramsay was influenced in his current financial thinking by Crown’s philosophy.
Ramsay and Crown each recommend that people first of all save $1000 as an emergency fund before tackling debt reduction. Their ultimate goal is teach that there is no need for debt, though mortgages serve a purpose, and that people should save for the things they want out of life. The advice that each party gives is not original. It can be found without the need to spend on their expensive programs, envelopes and books, though Crown do offer free counselling to those that request it. However it is far more likely to want a donation from you.
When it comes to their advice on paying down debt Crown offer the far more credible course of paying down the debt with the highest interest rates first. Ramsay prefers to push his method of paying off the smallest balance first, which ultimately costs more. Crown recommends increasing savings whilst paying down debt, whilst Dave recommends paying down the debt aggressively before dealing with savings.
Both focus on becoming mortgage free and saving for retirement, whilst Dave shows a marked preference for using cash. Crowns Mvenlope system is a computer program which allows for credit card payments online within its spending plan, whilst Dave’s envelope system involves keeping cash safely at home. He sells a range of envelope systems to hold cash.
Those in need of financial counselling would be better served with Crown’s program as it gives them free access to volunteer counsellors, whilst Dave’s pupils need to pay to follow his course. Ramsay is stridently vocal in his contempt of credit cards, to such an extent that if you want to purchase his online products you can only use a debit card. Crown on the other hand is quite happy to accept credit card donations from those that would like to give.
Both financial salvation systems appeal to the evangelical, though Dave is more of a cult figure to his followers, promoting himself far more than his company Lampo. He places more emphasis on the benefits of personal wealth and likes to mention his own financial success, whereas the emphasis with the Crown Ministries is giving ones wealth over to them through donations.
Those who aren’t attracted by the biblical emphasis of either can follow independent personal financial planning which also emphasises paying off debt and saving, without the need to purchase their biblical materials. It’s all rather a matter of financial common sense acquired though spending less than one earns and budgeting to make provision for the future.