Avoiding Debt is a Mindset (and a Blessing from God)

Photo credit here.

I was going to post something else before this, but that will be coming soon because it's still in the works. This was going to be the last post on general principles and serve as an introduction to the posts on specific strategies to avoid borrowing money. I make my plans; God directs my feet.

Many of the ideas for living free of debt will rely on the following over and over again:

1. Commitment to following God's word, whatever the cost.

   "But be doers of the word, and not hearers only, deceiving yourselves." (James 1:22)

   "And whatever you do, do it heartily, as to the Lord and not to men, knowing that from the Lord you will receive the reward of the inheritance; for you serve the Lord Christ." (Colossians 3:23-24)

2. Contentment.

   "Now godliness with contentment is great gain." (1 Timothy 6:6)

   
   
3. Candid humility.

   "A man’s pride will bring him low,But the humble in spirit will retain honor." (Proverbs 29:23)

   “And whoever exalts himself will be humbled, and he who humbles himself will be exalted." (Matthew 23:12)

   
   
4. Control of self and confidence. It can take a long time and be excruciatingly hard to wait to be able to do the things you'd really like to do without going into debt. You've got to have perseverence to be in it for the long haul, and you can only do this if you have faith that doing what's right will work out by God's grace.

   "Whoever has no rule over his own spiritIs like a city broken down, without walls." (Proverbs 25:28)

   "But without faith it is impossible to please Him, for he who comes to God must believe that He is, and that He is a rewarder of those who diligently seek Him." (Hebrews 11:6)

   "No temptation has overtaken you except such as is common to man; but God is faithful, who will not allow you to be tempted beyond what you are able, but with the temptation will also make the way of escape, that you may be able to bear it." (1 Corinthians 10:13)

5. Creativity, willingness to challenge assumptions, and the ability to think outside the box.

   "Through wisdom a house is built,And by understanding it is established;" (Proverbs 24:3)

   "If any of you lacks wisdom, let him ask of God, who gives to all liberally and without reproach, and it will be given to him." (James 1:5)

   
   
6. Careful planning.

   "The plans of the diligent lead surely to plenty,But those of everyone who is hasty, surely to poverty." (Proverbs 21:5)

   "For which of you, intending to build a tower, does not sit down first and count the cost, whether he has enough to finish it— lest, after he has laid the foundation, and is not able to finish, all who see it begin to mock him, saying, ‘This man began to build and was not able to finish’? Or what king, going to make war against another king, does not sit down first and consider whether he is able with ten thousand to meet him who comes against him with twenty thousand? Or else, while the other is still a great way off, he sends a delegation and asks conditions of peace." (Luke 14:28-32)

   
   
7. Community, kindness, and generosity: Individuals can become debt free, but if Christians would work together, new possibilities are opened up.

   "Though one may be overpowered by another, two can withstand him.And a threefold cord is not quickly broken." (Ecclesiastes 4:12)

   "But do not forget to do good and to share, for with such sacrifices God is well pleased." (Hebrews 13:16)

Over time, following these principles will bring great reward.

Blessings of Avoiding Debt

"Now godliness with contentment is great gain." (1 Timothy 6:6)

My last post examined some of God's warnings about debt. In this one, I would like to highlight some of the blessings being debt-free can bring.

First, though, here's a picture:

The guy on the left has no money and no debts. Simple enough. The guy on the right has $100K from a loan. It looks like he's on top of the world. However, far below him is $100K he owes. Below that is the interest he will owe. He could fall and be in a lot of hurt.

In the diagram, no payments are made initially, so assuming he doesn't lose the money from the loan, he can pay it all back, except he will still have the interest to pay. If he loses the money from the loan, he will fall to the $0 position, except with a lot of money and interest owed. If he doesn't lose the money and starts to repay it after a time, the amount owed and interest will decrease somewhat, but the money from the loan will decrease much faster. It will run out and he will still owe money.

With that in mind, let's look at some of the blessings of being free from debt:

1. Peace
Staying out of debt keeps things simple. There's no extra monthly payment to earn.

2. Security
If you don't have a mortgage on your house, it's quite secure. You actually own it. If you do have a mortgage on your home, you don't really own it yet and could lose it and the money you put into it.

3. Flexibility and Freedom
Debt ties people down. If you're not in debt, it's possible to consider switching jobs, moving at a moment's notice, or doing something similar. Just imagine the possibilities! Also, you aren't a servant to a lender. You're free.

4. Ability to Advance God's kingdom
What if instead of paying a mortgage for 30 years, you could give to missionaries or other worthy causes? What difference this would make over decades! Or wouldn't it be a blessing to be able to take time to protest abortion or go on a mission trip? How about saving something for future generations? All this is much more possible if you're not in debt.

What if you're already in debt?
Jesus is greater than any sin or unwise choice. Simply repent of sin (if any) and go forward, seeking to avoid debt in the future. In John 8:11, Jesus told a woman caught in adultery, “Neither do I condemn you; go and sin no more.” Ask Jesus for freedom from debt, seek to change behaviors that have brought you into debt, and don't worry. Read Matthew 6:25-34. It's very encouraging. I'd also encourage you to check out the Debt Snowball Method.

God's Word on Debt

Photo from here.

The Bible has a lot to say about debt. Let's start with two short stories that show where debt can lead:

"A certain woman of the wives of the sons of the prophets cried out to Elisha, saying, 'Your servant my husband is dead, and you know that your servant feared the LORD. And the creditor is coming to take my two sons to be his slaves.'" (2 Kings 4:1)

God miraculously rescued the widow, but debt nearly brought a catastrophe.

Note: Biblical slavery was nothing like the slavery we think of today. It was much better (temporary, the slave had rights, etc), but still not something to be desired.

In Matthew 18:23-34, Jesus tells the parable of two debtors (please read if unfamiliar). The main point is on forgiveness (including debt forgiveness, which we must be willing to sometimes do), but it also tells how prison and even torture were used when a debt went unpaid. Thankfully, these might not be the norm today, but people still do experience torture from debt in a figurative sense.

Let's continue:

[T]he borrower is servant to the lender. (Proverbs 22:7b)

You were bought at a price; do not become slaves of men. (I Corinthians 7:23)

Not having to borrow was a blessing God promised Israel if they would obey Him:

“For the LORD your God will bless you just as He promised you; you shall lend to many nations, but you shall not borrow; you shall reign over many nations, but they shall not reign over you.(Deuteronomy 15:6) 

“The LORD will open to you His good treasure, the heavens, to give the rain to your land in its season, and to bless all the work of your hand. You shall lend to many nations, but you shall not borrow. (Deuteronomy 28:12)

Conversely, under the sections of judgments for not obeying God's law is:

“He shall lend to you, but you shall not lend to him; he shall be the head, and you shall be the tail." (Deuteronomy 28:44)

When going into debt, people usually cannot afford to pay in full for what they're borrowing for. They assume that they will be able to pay the amount of the loan over time, but caution is required:

Do not boast about tomorrow, for you do not know what a day may bring forth. (Proverbs 27:1)

Come now, you who say, “Today or tomorrow we will go to such and such a city, spend a year there, buy and sell, and make a profit”; whereas you do not know what will happen tomorrow. For what is your life? It is even a vapor that appears for a little time and then vanishes away. Instead you ought to say, “If the Lord wills, we shall live and do this or that.” (James 4:13-15)

Finally:

Owe no one anything except to love one another, for he who loves another has fulfilled the law. (Romans 13:8)

Note: I've heard this could better be translated as "let no debt remain outstanding..."

There are more scriptures about debt, but these conclusions should be clear:

• Being forced to go into debt may be a sign of God's displeasure while being debt-free is a blessing.
• Borrowing should be avoided when possible. Going into debt needlessly is unwise.

Is going into debt a sin? We are not to turn from those who want to borrow from us (Matthew 5:42), and debt may sometimes be unavoidable, so I don't believe it's always a sin. If someone knew of the Scriptures above and carelessly took out a loan they didn't need anyway, I do think that would be disobedience to God's word.

Freedom in a Debt-Enslaved World, Introduction

During the next several weeks, I will, Lord willing, be posting a series about debt.

Why write on debt? Ultimately, to seek to advance the Kingdom of God, which brings glory to God and joy to mankind.

Here are some specific reasons:

1. To encourage those who desire to avoid debt. I believe that with the Lord's blessing, Bible-based brainstorming and perseverance can result in tremendous blessings.
2. To challenge these assumptions:
1. Debt is good. Many Christians don't seem to give a second thought to taking out loans for cars, houses, or even clothes. In fact, loans seem to be prized; they are frequently sought as if they were the key to a good life. Is this biblical? It is not.
2. Debt is normally a necessity. I've heard Christian leaders say that loans should generally be avoided, but this is usually caveated with, "except for a house" or something similar, as if it's impossible to live debt-free.

Should debt always be avoided? Could there be good debt? Is it a sin to be in debt? How could someone pay for cars, a house, and more without a loan? These are some of the questions I will examine in this series.

Before diving into specifics, some principles must be set down. Usually, once a clear principle is known, specific applications or questions are obvious or easier to resolve. At the very least, what to aim for becomes clear. Because of this, the first few parts of this series will be more general in nature. Only then, will some of the wonderful strategies on how to live free be examined.

Edit: This series is meant primarily for believers, those who have had their eternal debts paid. If you are not a believer, I encourage you to read https://www.livingwaters.com/are-you-a-good-person/? or other Christian resources.

Please feel free to comment. Remarks, questions, ideas, and constructive criticism are all welcome.

Index of posts (updated as new ones are published):

• God's Word on Debt
• Blessings of Avoiding Debt
• Avoiding Debt is a Mindset (and a Blessing from God)
• Modern Bank Loans: Pure Evil
• How to Fund Purchases without a Credit Card
• How to Buy a Vehicle with Cash
• Secondary Education (e.g., College) without Debt
• What about Emergency Loans?
• Debt-Free Investing + A Caveat about Short-Term Loans
• How to Run a Country Without Debt:
• 20+ Housing Options, Mortgage Evaded.