Biblical Finances (Debt)

Hi all,

I have a question about personal finances and what a Biblical perspective on them would be. There are multiple Proverbs that discuss how a borrower is a slave to the lender, and there is also Jesus telling us that no one can serve two masters. There are also people such as Dave Ramsey who say that all debt is bad and we should pay it off immediately.

My question is this: is it a sin to purposefully have debt in order to have certain things? (Car, house, etc.)
-My wife and I have a credit card that we only use for gas and groceries, and then we pay the full balance each month. This helps us build credit and acquire rewards points.
-Between her leased vehicle, my financed one, and her student loans, our monthly debt-to-income ratio is only slightly over 8%. If you include rent for our apartment, that increases to 34%. (We would like to get a house in the next couple of years, and the house payment will be less than our current rent.)
-We are giving each month to the local church and another organization

We have enough money in savings and mutual funds to pay off my car, her lease, and part of her student loans, but then we would have no money in savings, and no mutual funds.

From my viewpoint, I don’t think we are doing anything that is considered sinful in terms of our finances. However, I understand that I am a fallible human, and if I am completely in the wrong, I would appreciate the constructive criticism and guidance.

2 Likes

Hi Ashton,
this sounds like some of the similar things we do.

We also have a credit card that we pay all our expenses on, to earn rewards points when we then just get as EFT gift cards to pay bills, but then we pay it off in full automatically from our savings account (which happens to be an offset account against our home loan, saving interest off the home loan). I import this list into excel and then do a budget on it, with graphs etc, and share it with my wife so we are on the same page all the time with our finances. This helps me to have accountability to my wife, and stops me making unwise decisions for our family - and we feel like a team with the same goals.

I think the Proverbs passages are full of wisdom; the borrower is a slave to the lender; there is no question. When we purchased our house, we looked at the interest rate on the loan, and thought we want to be out of debt; owning our own home and rent free as well.

Jesus statement’s in the sermon on the mount is not about debt (in my opinion), it’s about the love of money, not the use of money. Someone who has debt can love money just as much someone who has heaps of money.

While thinking this through just now, a Proverb that may help - Solomon is praying that he will neither have huge riches; let he forget his need for the Lord, or poverty, so that he is tempted to steal to support his family.

Prov 30:7-9 Two things I request of You
(Deprive me not before I die):
8 Remove falsehood and lies far from me;
Give me neither poverty nor riches—
Feed me with the food allotted to me;
9 Lest I be full and deny You,
And say, “Who is the Lord?”
Or lest I be poor and steal,
And profane the name of my God.

I think practically each family can work through finances together - one thing that my Dad taught us kids was to not borrow against things that depreciate in value. This is our own personal decisions of course and everyone is different - we only borrow on houses (because lets face it, nobody can save up fast enough to stay ahead of the market and buy a house cash when they are 90 :slight_smile: ). We don’t have the option of leasing a car tax effectively so we just buy older cars cash only. Basically spend less than you earn, and you’ll start clearing debts.

So, i don’t think debt is a sin at all, giving to church is important (principals of tithing etc), but keep in mind that money is just one of our talents that we can use for the Lord.

You might find this talk by John Lennox about wealth and eternity encouraging. I found it encouraging because no matter what resources God has entrusted us with, we can use it for Him - even what seems to be mundane paying of bills - we’re actually looking after our family which He has given to us.

just a few thoughts hopefully others will join in too.

https://www.gospelpatrons.org/library/wealth-%26-eternity

4 Likes

@ashtonbrewer94 This is a very good question with multiple possible approaches. Each person’s situation is different and demands the freedom of conscience that Paul describes in Romans 14. Dave Ramsey gives good general counsel, but you need someone who can get to know your personal situation and give you specific advice. You may or may not need a professional. You will need to judge that.

I would like to add to @matthew.western’s very wise perspective. My take is centered around the following verse:

“But if anyone does not provide for his relatives, and especially for members of his household, he has denied the faith and is worse than an unbeliever.” (1 Timothy 5:8, ESV)

This applies to just about everyone. All but the most destitute have relatives if not immediate families. Therefore, let us explore this verse’s applications to your question.

First, we are morally obligated to care for our families and relatives according to the means that God has given to us. My dad likes to say, “Pass it forward.” God blesses us so that we may bless others. Therefore, using a credit card in order to develop a good credit history like you do can serve God’s purposes because it can help you to get a good mortgage rate. Taking out a mortgage can be a good investment because a good home generally accumulates value. (One specific piece of advice: use a real estate agent. Do not do it on your own!) Getting a house within your means can be great for your family. This can be a good way to obey your moral obligation. I do not wholly agree with Ramsey that all debt is bad, although you have to stay on your toes so as not to get sucked into too much debt.

Second, getting a good life insurance policy is a good way to obey God. (Listen to Ramsey on this one!) If you are eligible and do not get one, who pays for your lost income if you die? Should a church have to support a family who could have maintained a base income on their own if the deceased had been insured at a reasonable rate?

Third, saving for retirement is a good way to obey God. Sacrifice now so that your children do not have to take financial responsibility for you later. Set aside 10% for tithe and 10% for retirement. A friend of mine likes to say, “He who does not save 10% when he cannot afford it will never save 10% when he can.” Saving $1,000,000 nowadays is almost a necessity. This can be a stretch, I know; but if you do the best that you can with the means that God has given you, God will take care of the rest.

Fourth, be generous with your God-given means. Give above and beyond that 10% tithe whenever possible. (I happen to believe that you can tithe time, too; but others do not share that opinion, and it is a topic for another thread anyway.) I have done many random acts of kindness that have borne much fruit in goodwill. Heed the parable of the corrupt steward from Luke 16:1–13: if unbelievers are wise with their wealth, how much more should we be?

4 Likes

Great question(s). My wife and I follow the Dave Ramsey plan and are on Baby Step 2. If you’re familiar with him, you know he’d say to pay off as much as possible with the money you have available. Because of the craziness of this world, I would say the same, but would not bring down your savings to just $1000. Maybe keep savings at $5000 and then throw the rest at the debt (vehicles, student loans, other debt).
As far as the question of “is this sinning or not”, I think of it as drinking a Coca Cola. It’s definitely not good for your body (AT ALL!), but it’s not going to kill you either. If you do want to strive for excellence and to do your best at being a good steward of your money (God’s money), then yes, try to get rid of debt ASAP so that you have freedom to live and give - and so you won’t be slave to the lender any longer. Blessings.

4 Likes

@alex_a7 would you include the home loan as well among the debt to be paid off as quickly as possible? I’ve only listened a bit to Dave Ramsey so I don’t know where he stands on that point.

1 Like

@blbossard That’s a great way to live, Brendan. In what sense do you tithe your time? For instance, would you include the time spent here? I have a hard time figuring out these things. I feel like if I’m enjoying something then I can’t include that or if I’m giving money to a relative then it’s not part of the tithe. Do you have any thoughts on that?

1 Like

Amal, I try to balance time spent on personal things with time spent serving others, which serves God (Matthew 25:31–46). I do not calculate 10% of my time in the same way that I calculate 10% of my money, but I believe that I need to make service a significant part of my life. My time spent on RZIM Connect is a good example of this. I need to be careful not to sacrifice family relationships to it, however (Mark 7:9–13).

I enjoy service very much because I love encouraging others. Sometimes the physical task is not very fun, but I seek gratification not in the task itself, but the fruit that it produces. Jesus endured the cross not as the end in itself, but the means to the joyous end (Hebrews 12:2). Sometimes the task itself is fun, but then God had fun creating the universe, so why should I not have fun serving him? It is the fruit that counts. Giving money to a relative can be part of tithing, in my opinion. Recall that if I do not take care of my family then I am sinning. If I have to choose between giving 10% to my church or taking care of my family, then I believe that taking care of my family takes precedence. That is just my view, and I am open to others.

2 Likes

Thanks, Brendan. I don’t know if anyone addressed whether the tithe should be of the net or the gross income. I’ve always thought that it ought to be 10% of the gross income. What are your thoughts on that?

1 Like

Net or gross is a matter of conscience. I calculate from net because it is easier for me to glance at the deposit in my bank account. I pay tithe on any tax refund as well. Others tithe from gross. One of my friends tithes on gross and treats any tax refund as a gift from God from which he does not tithe. I think that it all balances out in the end. There is no hard rule that I can find in the Bible.

1 Like