Transcript & Slides: Dealing With Debt

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Dealing With Debt
By David Feddes

Living on borrowed money is so common, and people in our society have so many debts that one writer described the average person as driving on a bond-financed highway in a bank-financed car, fueled by charge-card-financed gasoline, going to purchase furniture on the installment plan to put in his mortgage-company-financed home. That's the way many of us live.

There's no denying that living on borrowed money has its fun side. You can get what you want even before you're able to pay for it. The not-so-fun side of living on borrowed money is that you end up owing money for a long time afterward—even after the things you bought with the borrowed money are no longer so precious to you.

Your college years are exciting, but years later you're still trying to pay off student loans, even if you've switched to a career in a field that has nothing to do with your expensive university degree. Moving into your dream house is wonderful at first, but a few years later the house isn't so dreamy and the monthly mortgage keeps taking a bigger bite from your income than you can afford. A shiny new car is a thrill, but three years later the shine is gone and the payments remain to be made. The latest greatest computer or smartphone is nicer than a cheaper model, especially when you can get it on the no-payments-for-six-months plan—but you're still paying for it long after it's become old and slow compared to the newest ones. Keeping up with all the latest clothing fashions feels great, especially when all you need is a magic credit card, but it doesn't feel so great when fashions have changed and the credit card companies are hounding you. Newness vanishes quickly. Debt keeps hanging around.

For some people, debt is a hassle. You're not in a financial crisis and you're able to make the required payments, but you wish you'd been more careful with the money and you'd like to be debt-free.

For others, debt is more than a hassle—it's your boss, and you're its slave. It's a boss that bullies you and stifles your freedom. If you have lots and lots of personal debt, you don't have much financial freedom. There are lots of choices you don't have because you have debts that you have to pay. If you have business debts and finances are tight, you can't run your business the way you'd like. You have to keep your bankers and creditors happy. You're not your own boss. Others order you around. As the Bible puts it, "The rich rule over the poor, and the borrower is servant to the lender" (Proverbs 22:7). The rich rule over the poor—the people with the money call the shots for those who don't have the money and who owe them. The borrower is servant to the lender. You feel like a slave. You feel like you're in chains.

In some cases, the situation is even worse. Debt isn't just a hassle or a harsh boss, but a nasty monster that keeps growing and threatens to devour your personal life and your relationships. You owe so much money that you see no escape. You feel guilty for out-of-control spending. You feel frazzled. You feel endangered. The debt monster threatens relationships with spouse and family members. If you're a student, you may wish you could move out, but you have college debt. So your parents are asking, "Why don't you move out? Why are you still living at home?" Because you've got a college degree, but you also got that college debt. It's like a monster that hangs on to you. Sometimes you've spent so much on your credit cards, and now you owe so much that you feel like you're living in a horror movie: "Night of the Living Debt." Easy credit feels fabulous when you're getting stuff despite being unable to pay for it upfront. But debt can hatch into a peace-destroying, relationship-wrecking monster of debt.

It's not always evil to borrow money, and in some situations it might be unavoidable. But even so, debt is at best a hassle, at worst a monster, and it's usually a harsh boss. Debt is never desirable if it can be avoided. Much debt can be avoided if we stop assuming it as a way of life and instead set a goal of being debt-free.

What causes debt? Borrowing money.

How can you avoid debt? Don't borrow.

How can you escape debt if you're already in it? Pay off the loans and don't borrow anymore.

There's only one way to escape debt besides paying off the loans, and that's declaring bankruptcy—and that'll ruin your credit rating and have a lot of other negative impacts on you.

So how do you deal with debt? Well, answer the questions.

What causes debt? Borrowing money.

How can you avoid debt? Don't borrow.

How can you escape debt? Pay off loans.

If only it were so easy, you might say. "Well thank you, Captain Obvious! Captain Obvious to the rescue!" You already knew all that stuff. But how do you avoid it? How do you stop borrowing? How do you get those loans paid off? It's not as easy as saying so in a few words.

There's various types of debt. Student loans are one. Young people take out money to go to college or university. Sometimes older people do too, for their education. People take out a loan to buy a home or to finance a startup in business. They take a loan to buy a car. Or they just use credit cards and debt to buy stuff that they want as consumers, whether that's furniture or clothes or a phone or computer.

Sometimes we have debt that is just a personal loan to help us get through. And sometimes we get debt from co-signing somebody else's loan, and so their debts become our debts.

Let's start with that last one first. The Bible says to avoid other people's debts and not get entangled in them. "If you've put up security for a friend's debt, go and beg to have your name erased. Save yourself like a gazelle escaping from a hunter, like a bird fleeing from a net" (Proverbs 6:1–5). Those are words from the book of Proverbs. And here's some more Proverbs: "There's danger in putting up security for a stranger's debt. It's safer not to guarantee another person's debt. It's poor judgment to guarantee another person's debt or to put up security for a friend. Don't agree to guarantee another person's debt or put up security for somebody else. If you can't pay it, even your bed will be snatched from under you" (Proverbs 11:15; 17:18; 22:26–27). So the Bible strongly advises not to sign other people's debts and to make their problems your problems.

But then what about the words of Jesus? Jesus says, "Give to the one who asks you, and do not turn away from the one who wants to borrow from you" (Matthew 5:42). There it sounds like if somebody wants something, you ought to give it to him or loan it to him. Well, here's the way to think that through: Give somebody what you can. If you can afford to help, go ahead and help them. But don't make their debts your debts, and don't sign on to something that could be your debt in the future. Don't make a personal loan unless you're willing and able to lose that money. Think of it as a gift, not a loan.

What causes debt? Borrowing money. If other people are borrowing money, make sure that you're not caught up in the problems of their debts—because you probably will have enough challenges just dealing with your own debt. The obvious cause of debt is borrowing. And the obvious way to be debt-free is not to borrow.

Borrowing money is obviously the cause of debt, but why do we borrow in the first place? Well, to get things that we don't have enough money to pay for at the moment. And why do we go after things right now that we can't pay for till later? Why spend money that you haven't yet earned? If you can answer that question, you can deal with debt at the root level and move toward financial freedom.

The Bible says quite a bit about debt and about attitudes that tend to cause debt. Financial decisions usually express inner spiritual attitudes, and real financial freedom is closely tied to inner freedom in your spirit. So let's look at what the Bible says about attitudes and actions that cause debt.

Proverbs says, "He who loves pleasure will become poor; whoever loves wine and oil will never be rich" (Proverbs 21:17). So sometimes we just want stuff, and we want more and we want more and we want more—and we have that attitude. That's a quick way to get poor.

Sometimes we spend our money on bad stuff. "A companion of prostitutes squanders his wealth" (Proverbs 29:3). We waste money on sexual sin, or we might waste money on gambling or throwing it at other things that we shouldn't be spending on at all. The Bible says being “lovers of pleasure rather than lovers of God” is a problem—a major spiritual problem (2 Timothy 3:4). Being a lover of pleasure can keep people away from God and destroy their souls for eternity. It can also cause financial troubles in this present life.

People who love God and find their satisfaction in him are not addicted to luxury or sucked in by the promises of instant gratification. But in a society of pleasure worshipers, cravings run ahead of savings, and many people can't control spending or stay out of debt. They're suckers for the latest advertisement and for the latest pricey luxury that they don't really need. "Whoever loves money never has money enough" (Ecclesiastes 5:10). You might say, "Oh, if only I had more money, that would solve my financial problems." But the Bible says, "Of what use is money in the hand of a fool, since he has no desire to get wisdom?" (Proverbs 17:16). It does a fool no good to spend money on an education, says another translation, "because he has no common sense." So we need to understand that our first need is not just to have more money so that we can chase all that stuff we want—we need to get wisdom in how we handle money.

Another way that we go into debt and that we get ourselves in financial trouble is just by being gullible, by being a simpleton, by believing a smooth sales pitch. The person says, "Oh, you just got to have this to be happy, and it'll only be $200 a month," or whatever they tell you. And so you've got that impulse, you've got to gratify it, and the next thing you know, you've bought it and you've got more debt.

Proverbs says, "Leave your simple ways and you will live; walk in the way of understanding" (Proverbs 9:6). "The simple believe anything, but the prudent give thought to their steps" (Proverbs 14:15). Sometimes before you buy something, you should just give yourself several days to think about it and see if that impulse is still there.

Thanks to the internet, you can get hopelessly in debt without ever leaving your house. One of the most valuable companies in the world—Amazon—makes its money by selling stuff over the internet. That's convenient and nice in some ways, but it also means that you can spend, spend, spend, spend, spend just by clicking, and you can accumulate a lot of debt that way by buying things online.

Here's another cartoon: “The bank found suspicious activity on my credit card—it was being used responsibly to buy necessary things.” Well, some people's credit cards are used irresponsibly all the time to buy unnecessary things, so it might be a shock when it was actually used to buy something they needed.

Credit cards are useful if you pay them off every month and don't use them to borrow money, but just use them as a convenience. But they can run up huge debts if you don't pay off the full balance every month. "The borrower is servant to the lender" (Proverbs 22:7), and credit cards and other forms of borrowing are ways that we become servants to those who lend.

If you're wise, you follow a spending plan based on the facts of your income and your real needs. But if you're foolish, you might not plan at all. You focus more on your own pleasures or on other people's impression of you than on what's really best for you.

Do you buy a house as a place to live or as a monument to impress others? Do you choose clothes as a way to look decent and stay warm or as a way of impressing people around you? Trying to impress others is expensive, and it causes many debt problems. We buy things we don't need with money we don't have to impress people we don't even like.

The Bible says to know the difference between appearances and reality. "It's better to be a nobody and yet have a servant than pretend to be somebody and have no food" (Proverbs 12:9). Some folks look like they're not important, but they actually have people working for them. Others look like they're really rich and they've got almost nothing. "One man pretends to be rich, yet has nothing; another pretends to be poor, yet has great wealth" (Proverbs 13:7). If you can forget about appearances, you'll find that debt is a lot less likely to grow.

One man leases a fabulous car to show off, but he's falling behind on the lease payments. Another buys a used car to save money, even though he could afford to buy something much more expensive. So don't try to appear richer than you really are.

Again, financial actions reveal a spiritual attitude. God may give you enough to live on but not enough to fund your desire to show off to others. At that point, will you be grateful to God and live within your means, or will you spend more money than you can afford in order to look important?

Do you care less about what God knows of you than what other people think of you? Pride and showiness carry a big price tag and often lead to debt. Modesty and gratitude cost less and leave more money in your pocket to be used for other purposes—and better purposes.

It's important to identify attitudes and spiritual factors that tend to produce debt, but we don't want to stop there. If you're already deep in debt, you don't just need to know what got you there—you need to know if there's any hope of escaping financial bondage and getting new spiritual attitudes and practices.

Is there hope? Yes, there is.

The first step on the road to financial and spiritual freedom is this: trust God. Don't panic over money problems. No matter how much you owe, no matter how monstrous your debt seems, don't panic. God can handle it. So trust God and rest in his care. If money problems frighten you too much, it means you trust in money too much. Don't let money rule your life. Get in tune with God.

The Bible says, "Keep your lives free from the love of money and be content with what you have, because God has said, 'Never will I leave you; never will I forsake you.' So we say with confidence, 'The Lord is my helper; I will not be afraid'" (Hebrews 13:5–6).

God can handle every kind of debt. In fact, financial debt is easy for God to deal with compared to another kind of debt. If you think your financial debts are huge, what about the moral and spiritual debts you pile up by sinning against God? How can you ever pay the price of your sin debts and make yourself right with God? You can't. No payment is ever enough. "No one can redeem the life of another or give to God a ransom for them—the ransom for a life is costly, no payment is ever enough—so that they should live on forever and not see decay" (Psalm 49:7–9).

Our sin debt is so huge we could never pay it. But Jesus Christ came and paid it for us. When Jesus hung on the cross and suffered the punishment for our sin debt, he ended that payment by crying out, "It is finished" (John 19:30). The Greek word was tetelestai—one word. When archaeologists dug up ancient artifacts, they found many financial bills that had one word written on them: tetelestai—“Finished. Paid in full.” That's what Jesus was crying when he cried out on the cross. He wasn't just saying, “Phew, I'm glad this is over,” for his own suffering. He was saying, “The debt is paid. It's finished. Paid in full.”

And so we're reminded, "It was not with perishable things such as silver or gold that you were redeemed... but with the precious blood of Christ" (1 Peter 1:18–19). "Through him you believe in God, who raised him from the dead and glorified him, and so your faith and hope are in God" (1 Peter 1:21).

Our faith and hope are in God to pay off our sin debt, and our faith and hope are in God to pay off every other debt. Even though no payment you could come up with would ever be enough, God came up with a way to pay for sin. So if you trust in Jesus and count on his blood to cover the debt of your sin, then your sin debt is canceled and you're free from it.

That's the foundation of faith, and it's the foundation of any relationship to God. If you've never trusted Christ for your salvation, now is the time to do so. Don't even think about your financial debts until your sin debts are wiped out through faith in Jesus' blood.

Once you've trusted Christ as your Savior from sin, then trust him in every other area of your life as well. Count on Christ to help you deal with every challenge—including financial challenges. The Lord can handle every kind of debt. Financial debt is puny compared to sin debt. So if the Lord came up with a way to free you from sin debt, he can surely free you from financial debt.

How will God set you free from debt? Not usually by adding a huge amount of money to your income right away, but by making you wise in handling the income that you do have. God may bless you with greater amounts of money in the future, but his usual method is first to teach you to be wise and faithful with smaller things before he gives you more.

Meanwhile, being content with what God gives you—trusting that he'll never leave you or forsake you—puts you a long way toward success in dealing with debt. Fear and discouragement can paralyze you and prevent you from doing anything about debt. But faith in God empowers you with new hope, and it guides you with practical wisdom from God's Word.

How can you escape debt? Well, pay off the loans and don't borrow anymore.

Let’s look in a little more detail at how to go about that when you're dealing with debt:

1. Put God first. Tithe and pray.
2. Work hard. Gain gradually.
3. Budget to spend less than you earn.
4. Build an emergency fund.
5. Pay off debts in order of smallest balance or highest interest rate.
6. Avoid credit. Save at least 10%.
7. Invest for future goals.

Let's look at each of those in a little more detail.

Put God first. We've talked about that in another message, so I won’t spend too much time here. But make God your senior financial partner. When you tithe—give 10% of your money—you’re expressing that it’s actually all God’s money. You’ve got faith in him and you’re thankful to him for what he provides, and your giving shows that.

As you put God first, listen to what the Bible says. Listen to biblical wisdom about money, and pray for the Spirit’s guidance and help. When you put God first, when he's your partner, when you're listening to the Spirit and asking him for wisdom, he’ll give it to you.

The Bible says, "Honor the Lord with your wealth, with the firstfruits of all your crops; then your barns will be filled to overflowing" (Proverbs 3:9–10). So it may sound strange, but even when you're trying to get out of debt, make sure you start giving to the Lord so that you’ve put him first in your life and made him your partner.

Then work hard and gain gradually. Rely on wisdom and work—not luck or get-rich-quick schemes. Don’t seek instant fortune by gambling on lotteries, investing in cryptocurrencies that bounce all over the place, day trading, buying stocks one day and selling them the next, or by leveraging—borrowing money to buy things you think will go up—or by taking extreme risks. That is a quick way to lose even more money and get into even more financial trouble.

Work hard. Gain money little by little. The Bible says, "Wealth from get-rich-quick schemes quickly disappears; wealth from hard work grows over time. It grows little by little" (Proverbs 13:11).

The next step is to budget. This is very important. You need to spend less than you earn. If you keep spending more than you're earning, your debts are going to keep growing. If you spend less, you'll have money left to pay down the debts.

Budgeting is having a plan. It begins by tracking all of your spending for a while. Write down everything you do—even if you just buy a cup of coffee or a hamburger somewhere. Write down all of your spending and track your spending for several months so that you know where the money's going. Then look at what you've been spending and find ways to cut expenses.

Limit your time in stores or the time you spend on your computer or smartphone looking at stuff online so that you don't buy stuff on impulse. Just avoid unplanned purchases. Wait. If you didn't plan to buy it, then don't buy it on the spot. Wait several days at least, and even then, if you can't afford it or it wasn't in your budget, don't buy it until it's part of your budget.

The Bible says, "Good planning and hard work lead to prosperity, but hasty shortcuts lead to poverty" (Proverbs 21:5).

The next step after you've budgeted and gotten your spending under control is to build an emergency fund. Start out by saving $1,000 as quickly as possible. That may sound like a lot—if you're living in different countries the amount may differ—but start by saving an amount that will help pay for something if your car breaks down or if something goes wrong in your home. Make sure you have an emergency fund and build that fund as quickly as possible so you're ready for unexpected expenses and you won't need to borrow to pay them.

The Bible says, "In the house of the wise are stores of choice food and oil, but a foolish man devours all he has" (Proverbs 21:20). Don’t use it all up. Have something in store to meet challenges that can come up.

Then start paying off those debts. That's the good news. If you've got your spending under control, if you've got an emergency fund in place, then start paying off your debts.

There are two ways to approach it. Start with the smallest balance. If you have several debts, the littlest debt—just pay it off first, and you'll feel good about paying off that little debt. Then move on to the next one, and then move on to the next debt that's even bigger. This is what financial counselor Dave Ramsey calls the “debt snowball,” where you start with the littlest one and then keep going after the bigger ones.

Another approach is rather than starting with the smallest debt, look at the debt that has the highest interest rate and pay that one down first because that's the one that's hurting you the most. It depends how you're wired. Sometimes if you're not very good at paying down debt at all, it works to start with just the smallest debt so that you feel a sense of accomplishment by getting rid of it. But if you're pretty well-controlled and mathematical, then go after the highest interest rate debt first.

Always, of course, make the required minimum payments on all your debts, but pay down the debt that is either the smallest one or has the highest interest rate.

And I do mean pay it off. The Bible says, "The wicked borrow and do not repay, but the righteous give generously" (Psalm 37:21). So try to repay the people whom you owe. Scripture says, "Let no debt remain outstanding, except the continuing debt to love one another" (Romans 13:8). That's one debt we can never get rid of—we're always called to keep on loving.

Once you've paid down your debts, avoid credit. Just avoid borrowing more as much as you can. Then save 10% of your income and keep saving. Stop living paycheck to paycheck. Instead, enlarge your emergency fund. You may have started with $1,000—now get it big enough to cover three to six months of expenses in case you were to lose a job or face other major challenges in your life. Have a bigger emergency fund.

Then start saving. That saving—that 10%—is so that you can pay for major purchases, so that in the future when you need a car, you don't have to buy it on credit. In the future, if you want to start some other endeavor, you will have some money to do it instead of needing to borrow.

The Bible says, "Go to the ant, consider its ways and be wise. It stores its provisions in summer and gathers its food at harvest" (Proverbs 6:6–8). So that when winter comes, it's got the food that it needs. And so we too need to be savers—not just get caught in the paycheck-to-paycheck cycle if we can help it. I know sometimes it's very hard to do, but it is very valuable, and it gives you a little more peace of mind as well to have things paid down, to have an emergency fund, and to have things saved up for major purchases.

Then invest for future goals. Once you're out of debt, once you've been saving, it helps to stay out of debt by saving in advance.

Now, a home is often too expensive for somebody to buy without borrowing at least something, but a home also tends to hold its value, so it's a little different than other kinds of debt. But you still need to save in order to get an adequate down payment. And if you can save more and get your home paid off—so much the better.

If you're hoping to start a business, rather than borrowing to start it tomorrow, why not see if you can save some money for a while first and fund your own business endeavor?

Your children may need education, and some of that may be expensive. Rather than seeing them pile up all kinds of student debt, maybe you can work with them and with your own savings and have some money saved up so that they won't have to borrow as much.

Of course, part of your investing and saving for future goals is that you want to make a difference in the world. You want to support God’s work. We've already talked about tithing, but if you actually can manage to be blessed by God and to save, you may be able to go well beyond the 10% tithe and fund other endeavors and good causes and the mission of God's kingdom in the world.

And you need to think about retirement and an inheritance for your children. "A good man leaves an inheritance to his children's children" (Proverbs 13:22), says the Bible. So you may want to leave some sort of legacy and inheritance to others, as well as provide for your own retirement.

We’ll say a little bit more about that in a future talk.

So in dealing with debt:

1. Put God first. Tithe and pray.
2. Work hard. Gain gradually.
3. Budget to spend less than you earn.
4. Build an emergency fund.
5. Pay off debts in order of smallest balance or highest interest rate.
6. Avoid credit. Save at least 10%.
7. Invest for future goals.

Then you will not need to be a servant to the lender. You won’t need to be a borrower anymore.

And in all of this, be content and be confident. "Keep your lives free from the love of money and be content with what you have, because God has said, 'Never will I leave you; never will I forsake you'" (Hebrews 13:5). So we say with confidence, "The Lord is my helper."

 

Dealing With Debt
By David Feddes
Slide Contents

Dominated by debt
The rich rule over the poor, and the borrower is servant to the lender. (22:7)

What causes debt?
Borrowing money!

How can you
avoid debt?
Don’t borrow!

How can you
 escape debt?
Pay off loans!
(and don’t borrow any more)

Types of debt

1. Student loan
2. Home loan
3. Business loan
4. Car loan
5. Consumer credit
6. Personal loan to help
7. Co-signing another’s loan

Avoid others’ debts

If you have put up security for a friend’s debt… go and beg to have your name erased… Save yourself like a gazelle escaping from a hunter, like a bird fleeing from a net. (6:1-5 NLT)

There’s danger in putting up security for a stranger’s debt; it’s safer not to guarantee another person’s debt. (11:15)

It’s poor judgment to guarantee another person’s debt or put up security for a friend. (17:18 NLT)

Don’t agree to guarantee another person’s debt or put up security for someone else.If you can’t pay it, even your bed will be snatched from under you. (22:26-27)

Give to the one who asks you, and do not turn away from the one who wants to borrow from you. (Matthew 5:42)

• Give what you can, but don’t make their debts yours.
• Don’t make a personal “loan” unless you’re willing and able to lose it.

What causes debt?
Borrowing money!

Loving pleasure

He who loves pleasure will become poor; 
whoever loves wine and oil will never be rich. (21:17)

A companion of prostitutes squanders his wealth. (Proverbs 29:3)

… lovers of pleasure rather than lovers of God. (2 Timothy 3:2)

Fools and their money

Whoever loves money never has money enough. (Ecclesiastes 5:10)

Of what use is money in the hand of a fool, since he has no desire to get wisdom?

It does a fool no good to spend money on an education, because he has no common sense. (Proverbs 17:6 NIV, TEV)

Gullible simpletons

• Believing smooth sales pitch
• Gratifying instant impulse

Leave your simple ways and you will live; 
walk in the way of understanding. (9:6)

The simple believe anything, but the prudent give thought to their steps.(14:15)

Appearance vs. reality

Better to be a nobody and yet have a servant than pretend to be somebody and have no food. (12:9)

One man pretends to be rich, yet has nothing; another pretends to be poor, yet has great wealth. (13:7)

Content and confident

Keep your lives free from the love of money and be content with what you have, because God has said, “Never will I leave you; never will I forsake you.” So we say with confidence, “The Lord is my helper; I will not be afraid.” (Hebrews 13:5-6).

Unpayable debt

No one can redeem the life of another
    or give to God a ransom for them—
  the ransom for a life is costly,
    no payment is ever enough—
  so that they should live on forever
    and not see decay. (Psalm 49:7-9)

Paid in full

It is finished. (John 19:30)

It was not with perishable things such as silver or gold that you were redeemed… but with the precious blood of Christ… Through him you believe in God, who raised him from the dead and glorified him, and so your faith and hope are in God. (1 Peter 1:18-21)

How can you 
escape debt?
Pay off loans! 
(and don’t borrow any more)

Dealing with debt

1. Put God first. Tithe and pray.
2. Work hard. Gain gradually.
3. Budget to spend less than you earn.
4. Build an emergency fund.
5. Pay off debts in order of smallest balance or highest interest rate.
6. Avoid credit. Save at least 10%.
7. Invest for future goals.

Put God first

Make God your senior financial partner.

• Tithe to express that it’s all his money.
• Listen to biblical wisdom about money.
• Pray for Spirit’s guidance and help.

Honor the Lord with your wealth, with the firstfruits of your crops; then your barns will be filled to overflowing. (3:9-10).

Work hard. Gain gradually.
Rely on wisdom and work, not luck.

• Don’t seek instant fortune by gambling on lotteries, crypto-currencies, day trading, leverage, or extreme risk.
• Work hard. Gain money little by little.

Wealth from get-rich-quick schemes quickly disappears; wealth from hard work grows over time. (13:11 NLT)

Budget
Spend less than you earn.

• Track all spending for a while.
• Find ways to cut expenses.
• Limit time in stores or online.
• Avoid unplanned purchases. Wait!

Good planning and hard work lead to prosperity, but hasty shortcuts lead to poverty. (21:5).

Build emergency fund

• Save $1,000 as quickly as possible.
• Be ready for unexpected expenses so you won’t need to borrow to pay them.

In the house of the wise are stores of choice food and oil, but a foolish man devours all he has. (21:20)

Pay off debts.
Start with the smallest balance or the highest interest rate.

The wicked borrow and do not repay, but the righteous give generously. (Ps 37:21)

Let no debt remain outstanding, except the continuing debt to love one another. (Romans 13:8)

Avoid credit. Save 10%.

• Stop living paycheck-to-paycheck.
• Enlarge emergency fund with enough to cover 3-6 months of expenses.
• Save ahead for major purchases.

Go to the ant… consider its ways and be wise! ... it stores its provisions in summer and gathers its food at harvest. (6:6-8).

Invest for future goals

• Purchasing a home
• Starting a business
• Educating children
• Funding missions
• Retirement & inheritance

A good man leaves an inheritance to his children’s children. (13:22)

Dealing with debt

1. Put God first. Tithe and pray.
2. Work hard. Gain gradually.
3. Budget to spend less than you earn.
4. Build an emergency fund.
5. Pay off debts in order of smallest balance or highest interest rate.
6. Avoid credit. Save at least 10%.
7. Invest for future goals.