Today’s Christian Man article written for Larry Burkett—January 2002

BECOME DEBT FREE--AND STAY THAT WAY

Some Christians think debt is a sin and that God’s Word forbids all debt at all times (see Romans 13:8). Others say debt is an acceptable and normal way of life that God uses to meet the needs of His people.

Debt is not a sin; but it is also not a normal way of life. Debt is a dangerous tool that must be used with caution and prayer due to its potential for enslaving people in financial bondage (see Proverbs 22:7). Successful business practices begin with good personal financial management.

Treat debt with extreme caution
 Debt presumes on the future. When you commit yourself to payments over a period of time, you make the improbable presumption that there will be no pay reductions, no loss of job or business, and no unexpected expenses (see Proverbs 27:1).

 Debt lowers future standards of living. Money borrowed must be repaid with interest. That means those things you purchase with credit will cost more tomorrow than they did today, and your standard of living will have to be adjusted to compensate for the added expense.

 Debt focuses on façade decisions rather than real-life decisions. Debt encourages decisions based on affordable monthly payments, rather than whether the total cost of the item is affordable (purchase price, operational expenses, and finance charges).

 Debt leaves you at the mercy of compound interest. The minimum monthly payment on a ,000 debt at 19.8 percent rate of interest, with nothing else charged on the account, takes eight years to repay, and costs ,023 for the privilege of charging ,000.

 Debt could delay God’s plan. God promises to provide for His people’s needs. Debt allows needs to be met now—but not through God’s provision. Debt provides instant gratification at the expense of financial freedom, rather than waiting on God’s perfect plan and time.

 Debt blurs the line that separates wants, desires, and needs. Needs are necessities: food, clothing, shelter, medicine, transportation, and others. Wants involve quality choices: discount shops versus designer shops; lobster versus tuna; a new car versus a good used car, and so on. Desires must be considered only after all obligations are met and only if surplus funds are available. Don’t allow desires to become wants and wants to become needs.

 Debt encourages impulse buying and overspending. In his book, Sound Mind Investing (Moody, 1996), Austin Pryor reveals interesting facts that are contrary to what most people believe. The CFO of a national credit card company said that consumers spend an average of 25 to 30 percent more when they charge than if they purchase with a check or cash and that a great majority of those extra purchases are the result of impulse buying.

 Debt stifles resourcefulness. Our society’s credo is “I want, what I want, when I want it.” The need to be resourceful—mend clothing or change oil in order to save money—is not relevant. Convenience is paramount, so we purchase new or charge services with “plastic” and then pay for it later, regardless of interest of finance charges.

 Debt eliminates family financial planning. Rather than plan for the future and allow for a margin of errors, overruns, and changes to dictate future financial development, debt eliminates the necessity for future planning, because the course for the financial future of the family will have already been set—by the debt that has been accumulated.

 Debt teaches children that the world’s method of managing money is normal. Debt causes our children to casually regard credit card use, loans and mortgages, and keeping vows to pay bills. Many of today’s college graduates have borrowed for education expenses and lived to their credit card limits. Most never even consider paying cash for anything, and they begin adult life with so much debt that they’ll have to work for years just to pay for the debt accumulated during college years.

Financial freedom—God’s plan for His people
It may not be popular, but debt-free living is still God’s plan for His people today. The blessings of becoming debt free go far beyond the financial area. They extend to the spiritual and material realms as well.

The effects of financial bondage on a marriage relationship are devastating, and the primary reason for marital failure is financial incompatibility.