Stewardship and the Family Economy with William Fullington [Dead Men Walking Podcast]

Yes.

So I think we need to talk a little bit about what capital is versus cash.

Capital, if you had to rent a car from somebody, you would have to pay for the use of that money, for the use of that car, correct? Sure.

Yep.

If you want to buy a car and you want to use somebody else's money to use it for whatever reason, maybe you have the money, but you choose to take a loan anyway, or maybe you don't have the money.

So the loan's your only option.

You are making a purchase using somebody else's money.

Well, you have to pay them to use their money, correct? Sure.

Yeah.

That's called interest, I think, right?

Yep.

And if you, why then when we use our own money, do we not pay ourselves back deliberately and taking into account inflation and opportunity cost into that just the same way the bank does?

Yeah, no, that's a great question.

And when you say the I word, inflation, I think everyone can relate to that, especially over the last three, four post-COVID years of an unbridled inflation rate.

We're seeing costs going up.

So dive into that a little bit when you say, I don't see why we don't do that.

How do we do that as a family economy?

So the way that's done is really controlling the banking function in your life.

That's probably not a common term that you've heard or thought about the banking function.

When we talk about a bank, most people think about an institution.

And sure, that's got the bank down the street on the corner.

But what is the function that that bank is providing for us? To simplify that and really understand, let's think about a blood bank.

What's a blood bank do? People make donations and blood is then stored to be ready for an emergency.

If that blood is only stored and never used, it doesn't do any good, does it? The bank is worthless.

It's just hoarding.

Yes.

So I think we need to talk a little bit about what capital is versus cash.

Capital, if you had to rent a car from somebody, you would have to pay for the use of that money, for the use of that car, correct? Sure.

Yep.

If you want to buy a car and you want to use somebody else's money to use it for whatever reason, maybe you have the money, but you choose to take a loan anyway, or maybe you don't have the money.

So the loan's your only option.

You are making a purchase using somebody else's money.

Well, you have to pay them to use their money, correct? Sure.

Yeah.

That's called interest, I think, right?

Yep.

And if you, why then when we use our own money, do we not pay ourselves back deliberately and taking into account inflation and opportunity cost into that just the same way the bank does?

Yeah, no, that's a great question.

And when you say the I word, inflation, I think everyone can relate to that, especially over the last three, four post-COVID years of an unbridled inflation rate.

We're seeing costs going up.

So dive into that a little bit when you say, I don't see why we don't do that.

How do we do that as a family economy?

So the way that's done is really controlling the banking function in your life.

That's probably not a common term that you've heard or thought about the banking function.

When we talk about a bank, most people think about an institution.

And sure, that's got the bank down the street on the corner.

But what is the function that that bank is providing for us? To simplify that and really understand, let's think about a blood bank.

What's a blood bank do? People make donations and blood is then stored to be ready for an emergency.

If that blood is only stored and never used, it doesn't do any good, does it? The bank is worthless.

It's just hoarding.