"The rich ruleth over the poor, and the borrower is servant to the lender." - Proverbs 22:7
The traditional American Dream, especially for those of us who grew up in families that survived the depression of the 1930s, was to have a home "free and clear" of any mortgages. The security of a debt-free home was the goal of every family in the 20th-century United States, however that is changing. Being in debt has become a way of life for many Americans. Recent economic data shows that consumer debt, particularly credit card debt, is on the rise. The stigma once associated with debt is gone, and it has become the norm to borrow money even for every day items like gasoline and groceries
The United States has become a nation of debtors. In recent years the level of household debt in America has surpassed the level of household income, so for the first time in our collective history we owe more money than we make. Consumer debt in America has risen to a record high of more than 2.5 trillion dollars. Today the average US household has more than $9,000 in credit card debt and spends more than $1,300 a year in interest payments. Meanwhile, the national debt (the amount of money owed by the US government) has surpassed 9 trillion dollars – and is increasing at a rate of about $1.40 billion per day.
"Debt is so ingrained into our culture that most Americans can't even envision a car without a payment, a house without a mortgage, a student without a loan, and credit without a card. We've been sold debt with such repetition and with such fervor that most folks can't conceive of what it would be like to have no payments," says Dave Ramsey, a well-known talk radio host and Christian financial counselor. While many Americans have become accustomed to making monthly payments, the truth is that debt is contrary to God's plan for our lives. The scripture clearly says the borrower is slave to the lender - God would have us free of that kind of bondage. Getting out of debt is one of the four basic steps of what we call "the Vortex Strategy."
The Vortex Strategy
Money is one of the most important inventions of humankind. Without it, a complex, modern economy based on division of labor, and the consequent widespread exchange of goods and services, would be impossible. Unfortunately, many experts believe we are on the verge of a financial crisis. In recent years the value of the US dollar has dropped significantly, inflation has increased, consumer debt has reached an all-time high, and the US housing market has become dangerously unstable.
It is impossible to predict what exactly the coming months will bring, yet we need to be prepared both practically and spiritually. Anyone that presumes that the coming 12 to 24 months are going to be smooth sailing just hasn't done their homework. It is clear we are facing turbulent times ahead. So if the United States is indeed facing a financial crisis, what should we do about it? How can we prepare for times of economic uncertainty? What does the Bible say about our financial stewardship? Chuck tackles these tough questions in his new briefing titled The Vortex Strategy (click on the link to learn more).
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Incurring debt is like playing the lottery with God. "Go to now, ye that say, today or tomorrow we will go into such a city, and continue there a year, and buy and sell, and get gain: Whereas ye know not what shall be on the morrow. For what is your life? It is even a vapor, that appeareth for a little time, and then vanisheth away." (James 4:13-14). We may not have a job long enough to pay back what we borrow. If we have a great deal of debt, then much of our current incomes must go toward servicing that debt, leaving very little to live on. Not much of our income is left to pay for heating and cooling our homes, or for buying gasoline and food. It is both personal and governmental debt that will cause us to endure some severe tribulation in the up and coming months ahead. George Cancilla Click here to reply to this post
Interesting Thought
Posted On: 05/20/08 03:59:23 AM
Age 40, NH
George,
I appreciate your words but the passage in James is not speaking of debt but the characteristics of men. You only quoted 1/2 of the thought James wrote down also. It continues that we "should say if the Lord allows, we will do this or that." There is nothing about debt there but there is the verse after this part of the thought that speaks of arrogance in ignoring God. I do have a few questions I have for you.
1. When I had 2 knee injuries and lost 16 months of work out of 2 years and I had no income, should I have not had a home or bought food for my family?
2. Attending school for ministry training cost "only" 34.5K in debt for us. Should I have disobeyed God when He led me to attended Bible College?
3. If I someday buy a home, will I need to have 150K-200K saved for the purpose or buying a home or would it be a sin to have a mortgage.
Grace and Peace,
Jim Click here to reply to this post
Clarification
Posted On: 05/20/08 11:01:16 AM
Age 61, MO
The verses in James were meant to indicate that we never know what tomorrow may bring. Incurring debt implies that we will have future income to pay off that debt. I certainly do not think debt is a sin, and in some cases, as you mentioned with the hospital stay, is unavoidable. The only medical coverage I have is social security, and my wife has none. We decided not to pre pay medical insurance, because we are faithful to pay medical debts after they are incurred on a payment plan with the doctors or the hospital. As far as owning a house and property, I think that keeping within one's means is the deciding factor. One way to clear up debt more quickly is to overpay each of the installments. A part of each billing goes to interest and a part to reducing the principal. The overpayment amount goes directly to reducing the principal, which also reduces the owed interest. I understand how difficult it is to live in today's society without incurring some debt, but we should make every effort to keep it at a minimum and pay it off quickly. George Cancilla Click here to reply to this post
We Agree More Than It Shows
Posted On: 05/20/08 05:56:59 PM
Age 40, NH
OK, then debt isn't sin in and of itself and it isn't playing lotto with God unless it is being abused if I understand what you are saying George. Am I correct in understanding your words? Please let me know if I am not understanding you correctly.
I think the living within one's means is the best, biblical advice one can give. In a perfect world there would be no debt. If we had a slave (debtor) release every 7 years and a jubilee every 50th, we would be better off I think.
Grace and Peace,
Jim Click here to reply to this post
Yes you are correct
Posted On: 05/20/08 07:49:10 PM
Age 61, MO
"Playing lotto with God" was a bit overplayed. Sometimes I get carried away. Sorry. George Cancilla Click here to reply to this post
Debt in and of itself is not evil and that is why God had the slavery system in place, just in case you couldn't pay all your debt(s). Of course the opposite is true, no debt would be the best scenario for people. Unfortunately, attempting to save enough to purchase a car that works so one can secure a job usually isn't possible nowadays with the way businesses are clustered in certain areas and we are not near enough a job that allows saving money.
The problem is not an easy one to solve.
Grace and Peace,
Jim Click here to reply to this post
sometimes
Posted On: 05/19/08 01:28:55 PM
Age 47, TX
In some cases this is true. But, in many cases, debt is incurred due to poor selfish choices. We drive 2 older cars that have been paid off for a long time, while most of our friends and neighbors have chosen to do otherwise. Our house is now paid off due to frugal choices we have made, but again our friends and neighbors have chosen to do otherwise. Click here to reply to this post
