Biblical Principles of Money Management: Debt

by Jessica Sommerfield · 0 comments

Debt is not a modern concept. Long before the establishment of banking systems and credit scores, lending and borrowing transactions have been occurring, whether the currency be money, goods, or services. While the Bible isn’t a money management how-to textbook and doesn’t reveal a 5-step program for getting out of debt, it does contain wisdom on topics of responsible money management, including the dangers and consequences of debt.

Here are several Scriptures that deal with the concept of debt and how they apply to our personal finances:

If a man borrows anything from his neighbor, and it is injured or dies while its owner is not with it, he shall make full restitution. — Exodus 22:14

The wicked borrows and does not pay back, but the righteous is gracious and gives. — Psalm 37:21

The rich rules over the poor, and the borrower becomes the lender’s slave.  — Proverbs 22:7

Do not be a man who strikes hands in pledge or puts up security for debts; if you lack the means to pay, your very bed will be snatched from under you. — Proverbs 22:26-27

It is better that you should not vow than that you should vow and not pay. –Ecclesiastes 5:5

Owe nothing to anyone except to love one another. — Romans 13:8a

Borrowing: Be A Person of Your Word
Borrowing something should always be taken very seriously, whether you sign an official loan document or simply accept money from a  friend when you’re having financial problems. When you sign a loan document or credit card agreement, you are promising to restore everything you borrow (plus any interest you may owe for the service). Defaulting on loans and other debts shows very poor stewardship, planning, and responsibility. It not only reflects poorly on your credit score, but also your ability to be trusted and depended upon to follow through with other promises and obligations. Granted, there are situations when defaulting on a loan is necessary due to circumstances beyond your control, but in any case, debt is not something that should be taken on lightly. Resolve not to be someone who ‘borrows and does not pay back.

Don’t Be A Slave to Your Debt
In our modern world, we are seldom thrown into prison or forced into slavery because we can’t pay a debt, but this practice was not uncommon in ancient times. While we may not be literal slaves to debt, we can be, figurative slaves. When you owe the bank or even just a friend, in a way you owe a part of yourself — your job, your paycheck, your resources.  Getting too bogged down with debt might require you to work extra hours at work just to pay your bills,keep you from saving money, have you so stressed that your health is affected, or have other negative controlling affects on your life.

Security for Debt: Leans and Home Equity Loans?
Proverbs 22 warns about putting up security for debts. Immediately this makes me think of car loans, which usually include leans. If you don’t pay, the bank can take your car. Although having your car repossessed is certainly not cheery, having your house taken away would be much worse. There are sound reasons and  circumstances for taking out home equity loans, but you should always exercise caution when anything requires you to ‘put up security for debts.’

The Best Kind of Debt is No Debt
In our culture, especially, some forms of debt are nearly inevitable and not necessarily all bad. But there is definitely danger in acquiring too much debt and living well beyond your means. Don’t be pressured into a certain level of wealth or kind of lifestyle you can’t actually afford. Living on the edge may be adventurous, but when it comes to your finances, it can cost you literally everything.

This being said, the best kind of debt is no debt. There is incredible freedom and peace of mind in being debt-free, knowing you owe no thing to no one. Find  a good debt consolidation and elimination plan that works for you, and set goals to be debt free. You will never want to go back.

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