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What is a Materiality Threshold?
The following was written by Zack Fulmer, a Senior Private Wealth Advisor located in Ronald Blue Trust's branch office in Orlando, Florida.
Have you ever heard of the concept of a “materiality threshold?” Simply put, it’s financial industry terminology for how much you personally consider to be “a lot.”
As an advisor who has helped countless clients on topics concerning money, I’ve observed that people define “a lot” quite differently. For example, to some a $100 dinner out is expensive, and to others it’s quite normal. Furthermore, we often determine our own materiality threshold by trying to keep up with or compare ourselves to peers or neighbors, or by spending based on justifications we’ve made in our minds.
I Chronicles 29:11 tells us that everything in the heavens and earth belongs to the Lord. According to Ron Blue, founder of Ronald Blue & Co., the implication of that acknowledgment is that “every spending decision is a spiritual decision.” If we truly see ourselves as stewards of God’s resources, then each time a dollar arrives in or leaves our hand, there are spiritual implications.
At Ronald Blue Trust we help our clients view their cash outflow as five “buckets:” 1) taxes, 2) giving, 3) debt, 4) margin, and 5) living expenses. The “Five Uses of Money” model has been invaluable to me over the years as I help clients evaluate cash flow decisions. I continue to find it fascinating that God gives us clarity about four of the five uses. These are usually easily quantifiable:
Taxes – pay what you owe
Debt – repay what you owe
Margin – save for God-ordained purposes (an amount that’s discernable with planning)
Giving – be increasingly and abundantly generous at a minimum percentage
However, with regard to lifestyle, there is very little, if any direction on discerning how much is “too much.” Living expenses are just as important as the other uses of money and equal in priority. My sense is that our Father intentionally does not prescribe a “right” lifestyle. Rather, in earnest pursuit of intimacy with His children, He leaves the issue open for discussion, hoping that we prayerfully seek His wisdom.
A deeper understanding of how He’d like you to steward your resources brings with it contentment, whether materially rich or materially poor. As you seek to answer your personal lifestyle questions and even consider your personal materiality threshold, rest assured that Christ will give you the strength to find contentment if it is Him that you seek first:
"I am not saying this because I am in need, for I have learned to be content whatever the circumstances. I know what it is to be in need, and I know what it is to have plenty. I have learned the secret of being content in any and every situation, whether well fed or hungry, whether living in plenty or in want. I can do everything through him who gives me strength." Philippians 4: 11-13 (NIV)
What do you consider to be your personal materiality threshold when it comes to routine expenses? How did you arrive at that determination? How has it evolved over time as your personal picture of wealth has changed?
Jesus knew that money and possessions would be a chief competitor for our heart, and thus the answer to the lifestyle question lies not in comparison or justification, but rather in purpose. You see, He desires that your lifestyle reflect the plans He has for your life.
I invite you with each passing prayer to learn to be equally content, whether you have increasingly more resources or increasingly less, so that your lifestyle truly reflects your God-ordained purpose.
At Ronald Blue Trust, we seek to provide clients with financial strategies based on biblical wisdom to help you achieve clarity and confidence around your finances. If you would like to learn more about living generously so that your life reflects His purpose, please contact your Ronald Blue Trust advisor, call 800.987.2987, or email
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