Debt Crisis!

If your not living in a van down by the river or in some commune, you have heard about the national debt crisis.  It is an enormous amount of debt, but it is just a reflection of our own personal debt crisis. There are two questions we have to answer in our own lives: Is my debt helping or hurting me?, and what does God say about debt?

There are two basic thoughts on debt and if you are like me, you where taught that debt is okay or even good if it is well managed.  If you want to purchase a home or car, then debt will help you achieve that goal.  The second mindset is that debt is something to be avoided and should only be used very conservatively on rare occasion.  The problem with the first mindset is that we haven't done the math to see if debt is helpful and we tend to let our debt creep into other purchases causing a debt spiral.

I was in the first camp and I can remember my own debt journey.  I opened my first credit card at 20 years of age and always paid it off on time.  That is until I misplaced the bill and received a late fee and a ding to my credit score.  In college, I made a scant $400 a month and started putting groceries on my credit card and paying only the minimum.  I made it through college and got a full time job, so of course I paid off the credit card and bought a brand new car.  This new car came with a $400 payment.  A few years later, I got married and, of course, bought a house (after all I had to buy quickly because house prices would only go up, ouch!).  This left me in a pile of debt and barely able to make all my payments.

I ask the question again, is your debt helping or hurting you?  It nearly crushed me.  So what does God say about debt and would this have helped me avoid my personal debt crisis? Proverbs 22:7 says "The rich rule over the poor, and the borrower is slave to the lender." - NIV  How true this was for me.  I had so many payments that I was truly a slave to them all.  I was able to tithe and eat, but had nothing left for saving or even the occasional date night (unless I wanted to add to my debt).

Now what?  If you find yourself in debt, how do you get out?  God speaks into that one as well; Proverbs again talks about what to do if you have ensnared yourself. "So do this, my son, to free yourself, since you have fallen into your neighbor’s hands: Go—to the point of exhaustion—and give your neighbor no rest! Allow no sleep to your eyes, no slumber to your eyelids. Free yourself, like a gazelle from the hand of the hunter, like a bird from the snare of the fowler." - Proverbs 6:3-5

Do whatever it takes and get free!  Dave Ramsey gives the practical advice to first save $1,000 as an emergency fund to keep from going back into debt, and then paying off everything but the house.  These are the first two steps to freeing yourself from the slavery of debt.  This is something that my wife and I have applied in our life with great results.  I will confess that it is hard!  It isn't pleasant or easy, but it is worth being free to allow God to use you in ways that you never thought possible.  There is hope and you can do it, you just have to want it bad enough.

If you are looking for more tips and tricks on getting out of debt, Dave Ramsey has some great articles and materials including an article titled "Get Out of Debt with the Debt Snowball Plan" to get you started.  You need to get mad about being a slave and sign your own emancipation proclamation. Do it today!

If you truly want to be debt free you will need a plan.  Check out my blog post about the dreaded "B" word, "Budgeting".