If you are a student considering a college education or currently attending a college, you have most likely heard conversations about the concern of rising student loan debt. But, before we get into the dangers of debt, it is important to completely understand debt from a spiritual perspective. Debt, any money owed to anyone for anything, is not a sin. Many Christians believe holding debt is equivalent to not being financially wise with the money that God owns; therefore, making it a sin, but the Bible actually never says that debt is a sin. The problem with debt lies within the heart condition of an individual. Sin arises due to various qualities like greed, impatience, lack of self- discipline, or even self-worth. The Bible does say that all debt must be repaid as well.
When considering taking on debt, you must ask yourself, “does it make economic sense; do my spouse and I have unity about taking on this debt; do I have peace of mind when accepting this debt; and what personal goals/values am I meeting through taking on this debt?”
Along with asking these questions, it is important to understand the dangers of taking on debt. The first economic danger of debt is the compounding effect working against an individual. For example, if a home were purchased using a 30-year, $100,000 mortgage with a 5% interest rate, the total cost of the home with the paid interest would be $193,256. That is almost double the borrowed amount!
A second danger of debt is that it has a tendency to have a snowball effect. Getting into debt can be quite easy, but getting out is the challenging part. In order to get out of debt, an individual must first stop going into debt. This might sound like common sense, but it can be hard to break habits in order to get out of debt. Then the accumulated debt, and the interest, must be paid back. A third economic danger of debt is that debt always mortgages the future. For example, a person’s first priority of future income is to pay off the existing debt instead of using it for lifestyle, giving, or investing. Unfortunately, today’s U.S. society tells us to “raise your standard of living by buying what you want and paying for it while you enjoy it.” The reality of this is that an individual may be lowering their standard of living in the future by doing this.
On top of economic dangers of debt, there are also spiritual dangers. These are (1) borrowing always presumes upon the future, and (2) borrowing may deny God an opportunity to work. Number one means that we are assuming our circumstances in the future will allow us to pay off our debt. For number two, we often find ourselves believing that debt is the only option to accomplish some of our goals, whether that be attending a college, starting a business, etc. But God could be working to provide the money in another way. Instead of leaning on God and seeking out His plan, we often take the matter into our own hands, which may backfire. Always pray to God asking Him to show us where He wants us to go.
Finally, whenever you borrow money for any reason, there must be a guaranteed way to pay it back. Debt may seem like a great way to get cash fast but remember these dangers of debt before taking it on. If you would like to talk through the pros and cons of taking on debt or make a plan to pay off current debt, please feel free to email me at [email protected] so that we can set up a NEXUS coaching meeting.
Blue, Ron with Michael Blue. Master Your Money: A Step-by-Step Plan for Experiencing Financial Contentment. Chicago: Moody Publishers, 2016.