Atheist Personal Finance?

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If you want to offend people, talk about religion and politics. I’ve discussed politics on TF, but have purposely avoided religion. Why needlessly stir a pot? Well, I have an argument to make about religion and personal finance or — more accurately — its antithesis: atheist personal finance.

Atheist Personal Finance
Probably the only religious symbol I could desecrate without offending anybody.

I’m a huge believer in freedom of religion. I also think that the separation of Church (or Mosque or Synagogue) and State is a vital component of a free society. Proof: look at how America revolutionized freedom, in large measure by implementing secularized institutions (also by serving a well-deserved smack-down to the Brits). America doesn’t have an official religion. You’re supposed to be free to practice whatever religion you choose without undue interference. That whole “non-interference” thing is a lot more successful when the government doesn’t have its own Pet Religion.

And with that caveat, I’m going to go out on a limb and state something that may upset some Readers: Atheism is, by far, the belief system that is most consistent with personal finance success. Just to be clear, this is not me trolling you all. I think it’s true.

Atheism is about rationality. Money is rational. There is no magic to money. There is no unseen, imaginary realm. Abstract concepts? Yes — math is just a useful form of philosophy, after all. Financial markets arising from billions of bits and bytes? Absolutely. But money, whether gold or fiat or bit coin, can be reduced to existence by way of Occam’s Razor. Using a scientific approach — the idea that hypotheses should be proven with evidence as well as questioned (especially after being proven) — to personal finance would result in a lot less bull, stupid choices, and whiny debt bloggers.

“Faith is never having to say you’re wrong.” — unknown

Religion isn’t about scientific inquiry. I don’t say this to insult any belief system. Religion is based on faith which, in turn, trumps facts, logic, and evidence (in the eye of the beholder). A mind that accepts faith as sufficient to prove a claim is prone to accept other illogical premises. I’ve listened to Dave Ramsey’s show. He pitches Christianity at the start and end of every episode. And in between I hear him telling millions of his listeners to pay off their smallest balance first regardless of interest rate. That’s just wrong. Whether you’re a Christian with debt or an Atheist with debt, you will pay the least interest by ridding yourself of the highest interest debt first. Ramsey defends his little pro-bank hustle by saying it’s psychologically satisfying to close the littlest accounts. Well, if you’re religious, why not ask God to give you the strength to pay off your debts in a rational way that minimizes interest and fees? Oh, is God not powerful enough for Dave Ramsey to promote that? Hmm… Sheer faith, applied in non-religious areas of your life, should be scary to you — whether it’s faith in luck (e.g. winning the lottery) or faith that wealth will be appointed to you because you’ve lived a meek life.

“Isn’t it enough to see that a garden is beautiful without having to believe that there are fairies at the bottom of it too?” — Douglas Adams

Atheists don’t need to tithe. Giving away 10% of your gross income is an incredible impediment to building wealth. Sure, you get a portion of it back at tax time, but you don’t get anything near a dollar-for-dollar refund. If you want to get an unbelievable tax rebate, donate to Canadian political parties. Donations to religious organizations are a really expensive, poorly-targeted way to help people. Before you say this is an incredibly uncharitable stance, keep in mind that the most generous people in the world — Bill Gates and Warren Buffett — are atheists.

Atheists can use weekend mornings for sleep or activities that build wealth. No temple on Saturday nor Church on Sunday. An actively religious person, on the other hand, can not (unless you go to your religious service and treat it as a captive audience for your sales pitch). (Side note: I’m surprised Trent Hamm hasn’t calculated the gasoline saved by an atheist personal finance / lifestyle orientation. Oh right, he’s religious so he’d rather focus on using fewer squares of toilet paper and ignoring the risk of re-introducing diphtheria to the first world because he hates science.)

Now THAT'S offensive

“The rich rule over the poor, and the borrower is servant to the lender.” — Proverbs 22:7

A brief survey of the texts of monotheistic religions reveals that, with exceptions, they’re anti-leverage. Judaism and Islam each bans usury (interest payments on debts; interest-free loans, however, are OK). Christianity, on the other hand, is a lot less consistent. The Old Testament is decisively anti-interest (allowing at some point an exception for charging interest to foreigners). Meanwhile, the New Testament seems to encourage fractional reserve banking — at least based on the Parable of the Talents.

OK, so being anti-debt is money-smart, right? We’re all going to live like no one else so, later, we can live like no one elseWrong. Consumer debt is stupid but debt as a source of capital has been essential — no, integral — to the development of every industrialized economy. If you had a knee-jerk “debt isn’t good” reaction, jaded by America’s recent debt bubble and Canada’s imminent reckoning, please educate yourself by reading The Ascent of Money by Niall Ferguson. Or just watch the PBS series based on the book.

Leverage is almost impossible to avoid if you want to get rich. As much as Robert Kiyosaki is a snake oil salesman, he’s right about some things, e.g. Other Peoples’ Money and Other Peoples’ Time are essential ingredients for getting rich. Debt doesn’t require a business’ owners to permanently sacrifice a portion of their business just to obtain necessary capital. If you become really successful, you still only need to pay the interest rate on your loans. Once you’ve sold an equity stake, however, that potential wealth is gone forever. Further, if a business fails, debt is less risky than an equity stake. Often it’s securitized by specific assets and is always superordinate to equity. Debt is thus a cheaper source of capital than equity. In short, Warren Buffett says you don’t need leverage to get rich. But Warren Buffett uses leverage.

The whole point of personal finance is to build wealth. Unfortunately for Christians (yes, we are drilling down to a specific religion because I’ve seen at least a half dozen Christian-focused personal finance sites), the Bible does not look kindly on aspirations of wealth:

  • “But woe unto you that are rich! for ye have received your consolation.” Luke 6:24
  • “Go to now, ye rich men, weep and howl for your miseries that shall come upon you.” James 5:1
  • “Then said Jesus unto his disciples, Verily I say unto you, That a rich man shall hardly enter into the kingdom of heaven. And again I say unto you, It is easier for a camel to go through the eye of a needle, than for a rich man to enter into the kingdom of God.” Matthew 19:23-24
  • “For the love of money is a root of all kinds of evil.” Timothy 6:10. Really? Humans have proven themselves capable of an array of unspeakable evils, many of which have no pecuniary underpinning. John Wayne Gacy didn’t rape and murder children for money. He was a sick, evil monster who deserved death. (And, by the way, I’m in favour of a death penalty for proven monsters like Michael Rafferty; thankfully I can form my own moral code rather than adhering to a set of rigid, often inconsistent principles, e.g. “Let he who is without sin, cast the first stone.”)

(And, please, quote some agrarian “harvest while the gettin’ is good” Bible verses as a petulant challenge to my quotation of the unequivocal verses above.)

If you think the entire purpose of existence is to serve a jealous, celestial Kim Jong-Il (who by all rights shouldn’t need your support anyway) then why would you care about saving money? Run up huge credit card debt and spend your life savings on advertisements for your religion. “Store up for yourselves treasures in heaven” rather than on Earth — it’s the ultimate deferred gratification. Saving for retirement is a waste of time and potential. Obviously not, but you can see the problems that occur when we take the impact of Christianity on personal finance to its logical terminus.

“What happens to the faith healer and the shaman when any poor citizen can see the full effect of drugs or surgeries, administered without ceremonies or mystifications? Roughly the same thing as happens to the rainmaker when the climatologist turns up, or to the diviner from the heavens when schoolteachers get hold of elementary telescopes.” — Christopher Hitchens (who apparently underestimated the average citizen’s stupidity by omitting the popularity of homeopathy, iridology, chiropractic “medicine”, mid-wifery, chelation, acupuncture, naturopathy, and ear candling.)

Thou doth protest: “What about the Protestant work ethic?” Well, as somebody who has actually slogged through Max Weber’s “The Protestant Ethic and the Spirit of Capitalism” in its entirety for a sociology course, I can say with great confidence that the Protestantism to which Weber referred was vastly more ascetic and pre-determinist than any modern variant of Christianity I’ve heard about (except, perhaps, the Westboro Baptist Church). Also capitalism — to Weber — had become a disenchanted religion in a self-sustaining feedback loop that no longer required religion to keep going.

So, for the minority of you who haven’t closed your browsers in disgust, thanks for sticking around to read about why “atheist personal finance” is a reasonable topic and “<insert religion here> personal finance” is probably an oxymoron. If I’m struck down this week, you know who to blame. (Me, for eating bacon every day.)

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26 Comments… Share your views

    • lol either offended folks aren’t saying anything or they understand I’m saying that my criticism relates to religion’s application to perfi rather than religions themselves.

  1. Mmmmmmm…..bacon…………………………

  2. I view personal finance as one tool in my quest for happiness, the pursuit of which I view as the meaning of life.

    Personal finance knowledge and using tenants of it can bring financial security, and thus comfort and stability and ultimately freedom to pursue happiness via personal community building, hobbies, giving money to charity, charitable volunteer work, family and friend time. Yes, faith and church could be part of that happiness pursuit. Hoarding money for the sake of hoarding money only brings happiness to Scrooge McDuck, who digs swimming in piles of it.

    Giving to a church/charity before becoming financially secure is putting the cart before the horse; I would (and do) tithe to charities after I have used personal finance skills to become stable and secure, not before. The people who give to their church while in debt are not giving their own money, they have borrowed to give, and thus not really tithing.

    Since I believe in the pursuit of happiness, and religious beliefs do provide happiness to some people (and war and death to others…I digress), I’ve nothing against people believing whatever they want. As long as they don’t try to force their beliefs on anyone else who doesn’t agree or use their religion to justify their restricting other’s freedoms/killing them/etc.

    Disclosure: I don’t go to a church nor give to religious charities, in fact I specifically choose secular charities like Care Canada over a religious charity that does the same thing, because I believe help for those in need shouldn’t come with bibles especially in third world countries where religious beliefs are not Christian to start with necessarily.

    PS: It boggles my FRIGGING MIND that Ontario allows the public funding of Catholic schools. I really really really REALLY can’t believe that happens in this day and age and I hope I live to see them all made private schools with no funding from secular taxpayers. Also the tax free status from secular governments that religious charities who discriminate get me riled up as well.

    • Excellent post Adam. I agree with your comments here. I particularly like the idea that tithing while in debt is like giving borrowed money. I am also an atheist and I do listen to Dave Ramsey’s show. I appreciate a great deal of the advice he gives particularly the baby steps of an emergency fund, paying off consumer debt, saving for retirement, and helping your kids get through post secondary school. All good stuff. I also agree with the concept of giving. The difference is I give because its the right thing to do, not because I am looking to be rewarded after I’m gone.

      I wish that Dave could separate his religious beliefs from his financial wisdom. I’m sure there are a number of non-Christian people who will not listen to his advise as he offends their beliefs (or lack thereof).

  3. I will refrain from wading into this discussion, save to say that I think it’s helpful to draw a distinction between (organized) capital-R religion, and personal (small-F) faith. Not all non-Religious persons are atheists (or agnostics).

    • The trouble with drawing such a distinction for purposes of my analysis (its benefit or problems for personal finance success) is that it renders such a belief system inscrutable. Even still, I think the first few paragraphs on faith can be extended. If a small-F personal faith, non-religious person draws a further distinction so as to make her faith even more inert/innocuous, then I would wonder why she even bothers. At that stage it just seems like an excuse to shop at Teavana with ‘like-minded’ soccer mom yoga enthusiasts.

  4. Eating bacon every day might lead to an entirely non-celestial heart attack. (Though that also depends on all the other factors of your diet, lifestyle, and genetics.)

  5. OccidentalCharlieHearse January 31, 2013 at 1:17 pm

    Fascinating entry, Joe. I enjoyed reading it. Mind you, I’m prejudiced, as I’m an agnostic. I used to find Dave Ramsay’s radio programme somewhat interesting, but I eventually stopped listening to him, mainly because of his not infrequent endorsements of his advertisers, and his not so subtle references to his religious beliefs. I’m sure there are many listeners, who don’t mind these things, but I never quite could understand the connection between a specific religious belief and financial progress.

    • His “endorsed local providers” and claims about mutual funds are indeed key reasons I stopped listening to him while doing house work. The idea that a “pro” is telling people to “find a well-managed mutual fund with a track record of success” even though research shows no manager is worth a 2%+ fee every year in the long run, and that he actively discourages index funds and the entire fixed income sector… it’s just nuts. And yes, while it’s great that people are engaging their freedoms to promote a particular religion as integral to personal finance success, it’s my job as a truth-seeking writer to lay out the facts where they lead. Thanks for stopping by and please visit again.

  6. I don’t think I want to wade into this one very far, but I do believe what Dave Ramsey teaches people is wrong. You should never let your emotions run your debt payoff. Aren’t emotions what got you into the problem in the first place? Most likely yes. I use and trust math because I can see the outcome, I don’t have to believe the outcome exists.

    • Bingo. I think I should have been clearer about the fact that I’m really imploring everybody, religious or not, to never apply blind faith to the practice of personal finance. Otherwise you end up doing stupid crap like Dave Ramsey recommends, e.g. paying lowest interest debt first and investing in 2.5% MER mutual funds lol

  7. Obama’s an atheist, isn’t he? I bet he’s dying to tell everyone.

  8. People should take the same approach like when oxygen masks are dropped on planes in an emergency. Put the mask on yourself first, make sure you will be taken care of THEN try to help others as best you can. If you want to give something it’s your choice but not so much as to derail your own future. 10% could be exactly the amount leftover that some people need for their retirement savings. It would be crazy to hand that over.

    • Exactly. And yet, there are a ton of destitute seniors who, for years, adhered to the edicts of preachers and televangelists saying “pay God first and you will be taken care of.”

  9. In Dave Ramsey’s defence, it’s not quite as cut and dried as the article makes it appear.

    First, some things are more important than money. Or alternatively, it’s not all about the money. Sometimes it’s about religion, and after that, community. I personally believe that we need to contribute to our community and those less fortunate – irregardless of paying off debt first. At some point, the obligation to your neighbours that don’t have enough food exceeds your obligation to pay down your debt. I can pay down $100 in debt, or I can fund a charity that’s going to make sure my neighbour’s kids have food to eat this week.

    Secondly, from a strictly financial viewpoint, the impetus provided by Ramsey via religion is doing a lot of good. While we might disagree with specifics, he does promote the idea of saving and paying down debt. AND he’s getting a lot of folks to do exactly that – people that would otherwise be mired in debt for their life. So he’s very specifically saving a lot of people from financial ruin. That’s admirable. Yes he’s a marketing machine while he’s doing that, but I don’t begrudge people making a living.

    And bear in mind that Dave Ramsey does promote the idea of learning. For example, he tells people to find a teacher instead of a sales rep. That’s excellent advice.

    Ramsey has a lot of regular folks sitting down and discussing saving, budgeting, and investing, people that would otherwise never have even thought about this stuff.

  10. Mitt Romney begs to differ!

    In all seriousness, I think you have an interesting argument, but there are several parts of the bible that encourage honest ways of making money. As on most topics, the bible presents opposing views.

    I think religion is great for accumulating wealth – as long as you are running the religion!

  11. I’ll meet you in hell in about 60 years. Oh hell, like we’re going to make it that long. 40, tops.

    We’ll have a barb-q. I’ll bring the chips.

  12. At a basic level some financial decisions are logical, so you can say that a 19% interest rate will cost you more than a 5% interest rate. In many areas there is a component of faith though. For example if you want to decide what the best investment is there are some that you can rule out from the start. Beyond that you just have to believe and you’ll only know the truth when it’s too late. A strong belief can even save you by preventing you from bailing out when it looks bad (though Pascal’s Wager is dangerous since a bad investment isn’t just a mild waste of time). And then there’s the whole field of economics which is a religion wearing a science mask, and full of faith healers, diviners, rainmakers, and oracles.

    I have an interesting insight into the whole anti-usury thing coming soon :) I was surprised to hear it at first but there is one great argument for it.

    • I had an awesome econ prof (actually he was teaching a mgmt course but is an economist) who insisted (and shouted) “Economics is a RELIGION!” lol I didn’t believe it til I saw their projections for housing in recent years.

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