To Borrow or Not To Borrow, that is the (steward’s) Question!
I’m just going to pick up where we left off last week with what Randy Alcorn points out are the consequences of debt.
- Debt is addictive. Actually I think it is the spending that’s addictive. It’s so much fun buying stuff and I know you all can justify all the stuff you have charged on your credit cards.
- Debt is presumptuous. We don’t know what tomorrow will bring but we just assume we will continue to be able to meet our debt obligations. I mentioned this a little earlier when we were talking about secured versus unsecured debt.
- Debt deprives God of the chance to say NO or at least “why don’t you think and pray about that before going ahead”. Have you ever had buyers remorse? Have you ever made what we call an impulse purchase? You know what I’m talking about. Please give God a chance to speak to you about the management of His money before you go into debt. He may have a really important lesson for you to learn.
- Debt prevents us from taking advantage of investment opportunities. Not only does the debt cost us in terms of the interest we are paying but we miss out on the interest we could earn from the investment. That last part is what economists refer to as an “opportunity cost”. There are actually two costs associated with debt.
- Debt ties up resources and makes them unavailable for the kingdom of God. I think this is the worst consequence of all. This is an abuse of our responsibility and power as a steward of God’s resources. Remember who you are. You are a manager of God’s property, money, possessions, etc. and as such you are supposed to be making wise/smart use of these things for the purpose of bringing glory to God. OUCH!!
The third issue Randy mentions in his book is that of the illusions we have about debt.
- We tend to think (wrongly) that the money we borrow is somehow ours. You know by now that that couldn’t be further from the truth.
- We think that the amount money we borrow is the amount we will pay back. We know this isn’t really true but somehow it just doesn’t seem to register. Paying off a 30 year mortgage on a home at a reasonable rate of interest usually results in a total cost of more than double the original purchase price. Yikes!! (my comment, not Randy’s).
- It’s foolish to pay off a loan that has lower interest than the money can earn somewhere else. This is where Randy and I may have to part company. That’s not to say I think you should go out and borrow (even low interest) money to make risky investments that promise high returns. To be debt free may certainly be liberating for many people. It may take away a great burden. It may lower the level of stress. I think this depends on the circumstances and your emotional capacity to handle the stress of debt. Paying off high interest debt makes obvious sense. I’m not so sure about low interest debt and don’t ask me where the dividing line is between high and low interest debt.
Certainly the Bible records the fact that borrowing and lending was going on back then. The Bible also speaks negatively about borrowing and points out some problems associated with borrowing. However, it does not prohibit it. This seems to be one of those situations where God is going to let us make our own decisions and hope/trust that we won’t make too many stupid mistakes.
For what it’s worth, I’m going to offer my opinion on the subject. Here’s the way my reasoning goes. God is Lord and Master. He’s in charge. We are stewards/managers of His stuff (everything) and as such we are expected to make wise use of His stuff to accomplish His objective(s). He doesn’t really need money to accomplish His objectives. He certainly doesn’t need for us to borrow money to help Him achieve His objectives. He has also promised to provide for our needs and He does that by equipping us for some kind of job or employment. Some of us (maybe all of us in this country) are taking advantage of Him by living a life style far beyond our actual needs. The money that is left over after He has provided for our needs is His of course and He expects us to use it wisely for His purposes. One of the needs He promises to provide is shelter or housing. From a practical standpoint, in the “real” world, that means renting shelter or buying shelter. I don’t think He cares which we choose but if we choose to buy shelter, chances are we will have to borrow some money. This is maybe the only place I think the Christian steward is justified in borrowing money. There are advantages and disadvantages associated with both renting and buying shelter. We could argue about it for awhile but in the end I think from an economic standpoint, it’s probably a wash as to which you choose. I am talking here about shelter NEEDS, not shelter wants, not shelter dreams, not shelter hopes, not shelter wishes, etc. The challenge of course is living IN the world without becoming OF the world. As you all know there is a wide range or spread of what’s available in the shelter market. Just take a look at the real estate section of your local newspaper or the multiple listing book or the FSBO website or any local real estate broker’s website. WOW!
Next week I want to explore how you can live IN the world of credit and not become OF the world. Credit is really important even for us aliens as we try to make our way every day in the “real” world.