Free Ebook.


« Fewer Americans Banking Online | Main | Carnival of Debt Reduction »

December 04, 2005

Comments

Feed You can follow this conversation by subscribing to the comment feed for this post.

I agree with those statements. I'm glad you posted this because it is useful for those of us who are looking for a biblical basis for our finances. Also, I don't remember where and this is a rough quote, the bible says to not forswear oneself because we don't not know what tomorrow may bring. Thanks alot!

Rick Lansdon

Remember, though, you have to interpret the statements in light of the social context. The Israelites did not have our modern financial system. Furthermore, they cancelled every debt in the Year of Jubilee, every 7 years. That might not work so well today - how would companies issue bonds? Today, debt per se is not a sin - almost everyone needs a car loan or a mortgage, because we don't usually plunk down cash. Going in debt does not necessarily make someone our master if rules are followed.

Today, I think we should reinterpret these statements to forbid us from usury - lending money at unreasonably high interest rates. We should forbid predatory lending. We should educate our children about finance to ensure that they don't get mountains of credit card debt. We should ensure that all people, regardless of race, class, etc, have the opportunity to borrow money at fair rates - that was the intent of the Community Reinvestment Act, which the banking industry helped to gut recently. And of course, it still is a sin to borrow and not pay back, barring extraordinary circumstances - if you lost your job and your house burnt down, you should have some debts forgiven, at least, it's the decent thing to do.

Weiwen --

I feel compelled to respond since I disagree with much of what you've said (or at least the implication of it). First, let's cover things I said that you misinterpreted:

Regarding debt for 7 years -- I didn't say it was a Bible-given rule, I said:

"However, I’d encourage you to use this as the maximum length of time you’d borrow from anyone. Even if you have to take a 15-year loan, have a plan to pay it off in 7 years or less."

It can be done -- I've done it.

Regarding debt being a sin -- I didn't say it was a sin. I said:

"The Bible does not prohibit debt. However, everywhere that debt is mentioned, it is discussed in a negative light."

Now, let's review some of your statements I disagree with. First:

"Going in debt does not necessarily make someone our master if rules are followed."

Yes, it does. You agree to pay back a certain amount at a certain time in a certain way. You are a servant to these terms. Furthermore, you're presuming on the future (that you'll always be able to pay back according to the terms) and that's not wise. The more you do this, the more of a servant you become.

Second:

"And of course, it still is a sin to borrow and not pay back, barring extraordinary circumstances - if you lost your job and your house burnt down, you should have some debts forgiven, at least, it's the decent thing to do."

No, the wicked borrow and do not repay. It's not "the wicked borrow and do not repay but it's ok not to repay if something bad happens." You have to repay NO MATTER WHAT. That's why it's so dangerous and why the Bible discourages borrowing. Now if the lender lets you out of the debt of his/her own free will, then you're free and clear. Otherwise, you have the biblical mandate to repay no matter what.

FMF

This is a very interesting take on debt! I never considered if it was morally correct to go into debt.

I've started a forum topic on my new personal finance forum where you can earn real money from asking and answering questions (and promoting your website!). Here is the post:

http://www.manageyourdollars.com/talk/viewtopic.php?p=21#21

I'm glad you are raising this issue. I'll readily acknowledge that it is easy to make judgments about how others manage their money, but I've often looked at the types and amount of debt that some people take on and wonder if they are doing the right thing for their families. For example, I see people who finance luxury cars but don't invest in their children's education fund, much less their retirement. It is even more strange when you hear of people financing a wedding.

It seems to me that there is a moral element to financial decisions and from my reading of the Bible, it frequently exhorts the reader to gain master over money. It can be all too easy to let money become an emotion-driven aspect of life.

The first point I want to make is being the best steward is the most important issue when it comes to borrowing and money.

When the bible talks about borrowing and debt, it seems to indicate several negative things:

1. The rich are lending to the poor, thereby ruling over them
2. The poor are borrowing to pay for necessities, liabilities (things that depreciate) or to squander
3. The borrower doesn’t have collateral
4. The borrower has to work to pay back the debt (slave to the lender)
5. Misuse of borrowed money is poor stewardship (since it’s not the borrowers money and is bound to the lender until the money is paid back)

Here are some questions:

1. Is all borrowing biblically wrong?
2. Is it biblically wrong or sinful for a rich man to lend to another rich man or for a poor man to lend to another poor man?
3. If someone borrows to purchase an asset (or capital) that increases over time and/or earns a rate of return is that unbiblical? Or is this good stewardship?
4. If the borrower has collateral to cover the debt is he still a slave?
5. If the borrowed money is working for the borrower (appreciating/earning a return) and the borrow now doesn’t have to work to pay back the lender because his borrowed money is doing all the work, is he still a slave?

Synopsis:

Borrowing money to purchase assets (also used as collateral) that appreciate and earn a rate of return is not the kind of borrowing that the bible is warning about. If someone can borrow and create more wealth with the borrowed money, he is being a better steward of Gods money. Remember it’s all Gods money, what the lender gave to the borrower was Gods money, not the lenders.

Since the borrower now has the money working for him and not him for the money, who now becomes the ruler? The borrower does, and the lender and his/the lenders money are working for him/the borrower.

Imagine if both the lender and the borrower are Christians and good stewards. The lender earns a return on Gods money that he lent to the borrower and gives a tithe back to God. The borrower takes Gods money that was lent to him and creates more wealth with it and gives a tithe back to God. Both are serving God and not each other.

Three things happen:
1. Gods money is increased by both the lender and the borrower (parable of the talents)
2. More money is given to put towards Gods kingdom purposes
3. They both hear, “well done good and faithful servant!”

Chris --

The Bible doesn't prohibit borrowing -- but it does warn against it. In every case.

For instance, even if the assets appreciate (which you can never guarantee), the borrower is still servant to the lender (still subject of making payments, doing certain things, not doing other things, etc.). That's one reason the Bible discourages it so strongly.

I haven't seen one verse (maybe you can show me one) that recommends borrowing. The Parable of the Talents says the men "put the money to work", not that they borrowed against what they were given.

Borrowing for an "appreciating asset" is a very slippery slope, and, I believe, is against the spirit of what the Bible teaches. In addition, it's just not great stewardship. Why not just eliminate debt, keep your spending low, and churn off a lot of cash from your income? That's a lot more reliable of being a great steward, isn't it?

I believe the fact that borrowing money is not a sin because it is better to be a servant for a short time during the period of the loan and be ruler over the poor forever than to refuse to borrow and remain in poverty for life.

My husband and I are christians. He is 47 and had a catastrophic illness and now completly disabled since april 05, We had way too much credit card debt 30 k. We were in debt settleent- I pulled out and Dave Ramseyed the remaining amt. My question. The last mbna acct is 9k. It has been in arbitation- they have agreed for a lump settlement of approx 7500. I will use some tax return to do this. Is this ok? I settled with capitol one earlier this year almost the same deal. They will send 1099s.
Daz

Is it ok in what way? I'm not sure what you're asking.

I think she's asking if St Peter will turn her away at the pearly gates if she settles with capitol one for less than the amount owed. Will paying a lump sum of 7500 on a 9000 debt make her a wicked person lol

Could you please send me some Biblical principles on Finance, I need it before Wednesday December 05, 2007.

Best regards,


Wesley A. Bryan

I think people can borrow money. Jesus said render to caesars what is caesars but its not pointed out that he relied on the money of the people... He did say be content with your wages but in Genesis he says if you do not well will you not be accepted? People define in reasonability how they do well and sometimes their own definition of doing well when in detrimental situations leads them to sinful ways. Why be content with wages when you cant be content yourself? Also Paul said if you give thanks for something that is good every good thing comes from god and if its reasonable in aspects to borrow money when all other options are exhausted how much more thankful will you be? Even if you do borrow And have faith and are a child of Gods then Gods interests are for you.

@Weiwan
The year of Jubilee is every 50 years, not every 7.
Just because almost everyone has a car loan and mortgage doesn't mean everyone needs one or that it is the best decision. It is quite easy to buy a car with cash and even possible to do with a house. While I agree with you about predatory lending and educating children, lending at a higher rate to someone with poor credit is not judging based on class or race, it is a simple fact that those people are a higher risk. When you borrow money, you promise to pay back the loan no matter what happens (even job loss), so you should not have your debt forgiven. If you pay cash for a house and lose your job the next day, you don't have to worry about foreclosure, and you can put food on the table with even a minimum wage job. If you had taken out a mortgage, you would lose pretty much everything. Therefore, you are a servant to the lender because they can seriously affect your quality of life if you default.

@Kayode
I am interested to hear how refusing to borrow money keeps you in poverty for life.


I had never thought to apply the 7 year principle to modern times - I think that's a good idea. We had planned to pay off our house in 10 years, just because we are still on the fence about whether it is better to become debt free or to earn more money in investments, so this was a good compromise for us.

I appreciate (and share) your beliefs on debt. I am amazed how many christians reject the principle of being debt free. Our society is so consumed by coventousness and it has spread through the church. We are a greedy bunch of people whose eyes are never satisfied. The scriptures are so clear on this subject, yet it is amazing how "clever" we are with our justifications for doing it (i.e. appreciable assets, etc). The response I hear from a lot of people is "well, we NEED this house... we NEED this car, or whatever it is they just HAVE to buy." We don't NEED these things... we WANT them. The problem is that we are not content with what we have. The scripture says "with food and clothing let us therewith be content." Paul said "I have learned in whatsoever state I am in, therewith to be content." We need to humble ourselves and LEARN to be content. Being content teaches us to rely upon God for everything we need. What more could a person ask for than to have God personally caring for his needs? Jesus said that if God takes care of the birds of the air and the flowers of the field, how much MORE will he take care of your needs. He followed that statement up with "O ye of little faith". And that is what it boils down to. We do not believe that God can manage our lives for us. We thin we know what we need better than God does.

As a personal testimony; My wife and I made a commitment not to borrow, based on what we felt was very clear biblical teaching against it. At the time we made very little and lived in southern California and had already accrued a bit of debt. We committed to God that we would not borrow, even if it meant renting the rest of our lives. We were willing to move to another state, and if we ever got enough money, to buy a very small house, if that's what it took. We had just started a very small business and weren't making much at the time. I believe God honored our commitment. About 2 years after that decision we were able to buy a very nice house for cash. After 10 years we were able to build our own house on nearly two hundred acres and purchase 3 additional very nice rent houses - all of it worth over $2 Million plus money in the bank. Although we've been blessed financially, we work hard to not make money the central focus in our lives.

I hope this will be an encouragement to others who may be considering making a commitment to stay out of debt and learn to be content.

What do you think about taking equity out of your residence and using it as a deposit to purchase an investment property?
Wrong?
Always?

Dan --

I don't think the Bible says debt is wrong, it just advises/cautions against it.

You keep saying you don't think the bible says debt is wrong but what about Romans 13:18 "Keep out of debt and owe no man anything, except to love one another; for he who loves his neighbor [who practices loving others] has fulfilled the Law [relating to one's fellowmen, meeting all its requirements].(AMP)

Dan Flynn,
First, I think it's best to have equity separated from your home. Two, if you're using it to buy assets, then more power to ya.

LM,
I think that's taking the bible too literally. How many churches out there are in debt? I know mine is. Are we saying that they're all sinners now? I don't think so. There are two kinds of debt: good debt and bad debt. Good debt is used to buy assets, while bad debt is used to consume.

LM --

If you look at other translations as well as the context of that passge, I don't think it is referring to monetary debt.

Remember the Ten Commandments!

Chris, thank you for sharing your story. I think it is important to understand that God is a loving God. Whether he blesses you financially or in other ways... if you honor Him and abide by the Living Word, you will be blessed.

And for all of these questions regarding whether you can leverage debt into something that will earn interest, or borrow if you pay back under a structured loan agreement, etc... What stuck out to me, was the similarity of gray areas and the pushing to see how far we can get away with what is clearly instructed of us in the Bible. I suppose it is human nature to take what is clearly Gods word on something, and see how close to going over the line we can go with it (I'll admit that I am guilty of pushing the boundaries in other ways...)

But what the Bible says regarding finances is very clear. There are no... "But if you can take this loan and leverage it to purchase another property" you will be blessed.

"For the love of money is a root of all kinds of evil." (1 Timothy 6:10)

God doesn't care about this man made paper thing called money. Money is money (or mammon from the original scriptures). What He cares about is our hearts. It doesn't say "For money is the root of all kinds of evil" it says "For the LOVE of money is a root of all kinds of evil". It's the LOVE of money that breaks God's heart, because He knows He doesnt have our hearts.

"No one can serve two masters, because either he will hate one and love the other, or be loyal to one and despise the other. You cannot serve God and riches!" (Matthew 6:24)

This is much bigger than a 'money' thing. When your heart is lined up with what is on God's heart, the stewardship of your 3 T's (Time, Talent & Treasure) will be aligned as well.

I have personally dedicated the last 3 1/2 years of my life to understanding Gods Word regarding finances with a group of guys at my church. Our hearts are passionate about sharing the Truth with the 20-somethings age group as they enter the most important time of their financial decision making lives. What I can say that when you spend time studying God's Word and give the Holy Spirit time to work on your heart, things happen that to your heart that you could only give the Holy Spirit credit for. And you view the world through a completely different set of lenses.

A quick story: I used to be an enormous car guy before I became involved with our financial ministry at my church. I had a really nice german car that I was obsessed with (i'm talking about taking it to different places and taking photo's of it, spending HOURS UPON HOURS on the forums seeing how I could modify it and make it faster, better handling, etc...) Well over the years of being in this financial group I felt God calling me to re-examine the motives behind why I longed for that car. (I'm not saying this is what everyone needs to do, this is specifically what I felt God whispering to me) But I felt the Lords blessing over me getting rid of the car to pick up one that is more in alignment with honoring Him in my motives. After much struggling with my own plan and selfishness... I finally sold the car and purchased a car I never would have imagined owning in my lifetime. I cannot explain it anymore than it being the Holy Spirit at work, but I have not regretted making that decision once since I've had this new car (and believe me, it is nothing to brag about lol). But what I can say, is that I feel in alignment with God in that area of my life where I didn't feel his blessing.

I hope that my story and passion for this topic has helped whoever has read this. And one last thing... I want to say that it is an incredible forum of open dialogue about this sensitive topic. Not enough Christians have accountability or a place to go to openly discuss their concerns regarding their finances.

My friend had someone borrow his orbital sander.Then he felt convicted "bad" about asking for it back (sic).Taking the scriptures that if someone asks (the person borrowed it) you for something, we should not ask for it back.Doesn't borrowing means to return it.The other friend has not returned it and this friend thinks it is not biblical to ask for it back. I guess the is an age old dilemna.What can I advice him. God Bless

Anthony --

Where does the Scripture say that? Are you referring to Matt 5:40-42?

This article has really opened my eyes. I was making plans to borrow for a nice, reliable car. But I was thinking to save so that I can put more than half down. In this way, it will reduce my car payment and shorten the years that I have to pay back the loan. There are family member who dissagree because they prefered if I just borrow the whole lump sum from the bank. You have confirmed that I don't need to take up a long term loan. And if we have the opportunity to pay as much as we can, why not pay as much as you can? So thanks!

We have a mortgage on our house. Two years ago we took the equity out of it, I think about $50K, and invested it in my husband's company, a rather small, employee-owned firm with $2 billion annual profits. In those two years we have made over $100K. We plan to continue to let that original investment stay in the program, and our company estimates that our earnings will be about $60K/year for the next two years, based on current projects under contract. Our investment earnings and bonuses have paid for braces, a grand piano, college tuition, travel, and just this year, a new Daytona RT, loaded, for me. It's so cool! We plan this year, to take some of our earnings and re-invest in other company projects, as we are fully vested in the orignal stock plan. But they offer other investment projects from time to time, which earn 10-30%/year.

We also gave over $3,000 personally to people in the ministry, and that is above the tithe which of course is much larger because our earnings are larger. It is all possible because we had a house - we would not have had it without a mortgage. We gotta learn to apply the principles in the Bible in today's world. Woodenly applying proverbs is not wisdom in every situation.

Sandra

Sandra,
My wife and I have a mortgage on our home too. We bought a small home thinking we were being wise (not stretching ourselves too thin). Well, then the Recession happened. Now our home is worth 60% what we paid for it and we are stuck. I’m glad that your investments have worked out so far, but I would caution you about them. What if your husband’s company went out of business? Your investments would be worthless, your husband would be without a job, and you would have a large house payment. That’s the definition of putting all your eggs in one basket. Why not consider pulling out enough to pay off your home? What would you do if you no longer had a house payment?
My wife and I made the decision a year ago to never again borrow money for anything. We are now debt free except for the house (which we are currently working on). It’s been a hard year, but it has grown us closer to each other and to God. It has been truly amazing to see how God has provided!

FMF,
Thank you for this posting. It is important to have dialogue on this subject that will cause us to think about the issue based on Godly wisdom and not American wisdom.

I like this particular article It gives me an additional input on the information around the world Thanks a lot and keep going with posting such information. I appreciate the concern which is been rose. The things need to be sorted out because it is about the individual but it can be with everyone. I like this particular article It gives me an additional input on the information around the world Thanks a lot and keep going with posting such information.

My husband and I are Christians who love God and we do the best we can living according to his word..especially his principles on finances. During the year of 2010 until now we have sown seeds(big & small)in fertile soil, paid tithes, given sacrifical offerings(3xs a yr as instructed by the word) all to the tune of $10K+. Yet, we are still waiting on a supernatural return from God. What do you suppose the problem/hold up is? We are givers that have been to the point of having no food to eat or gas for our car(his seed begging for bread). I was recently declared to be disabled and had to quite work, while my husband still works outside the home making around $16K a year . We still rent because we want to believe God for our home and not go into debt to make it happen. We feel let down by God. Can you give us some Godly insight? Please help. We feel abandoned.

Kaye --

It's impossible to really get a feel for this situation (and thus impossible to provide decent advice) in a blog comment. I suggest that you meet with your pastor, talk through the issue completely, and ask for his advice.

Kaye - I suggest that you find a church which teaches Biblically on giving. Prosperity teaching which you describe can cripple people financially and it is NOT Biblical.
The commendation in 2 Cor 8 and 9 is to be generous but not because you feel you have to or because you are doing it because you are going to receive something back.
Your story is heartbreaking and I urge you to reject this teaching but don't reject God.

The comments to this entry are closed.

Earn Extra Money

Save!


Enter your email address:

Delivered by FeedBurner

Disclaimer


  • Any information shared on Free Money Finance does not constitute financial advice. The Website is intended to provide general information only and does not attempt to give you advice that relates to your specific circumstances. You are advised to discuss your specific requirements with an independent financial adviser. Per FTC guidelines, this website may be compensated by companies mentioned through advertising, affiliate programs or otherwise. All posts are © 2005-2012, Free Money Finance.

Stats