The Christian Broadcasting Network

IMPROVE YOUR FINANCES

Goodbye Debt…Hello Prosperity!

By Laura Bagby
CBN.com Producer


The State of Our Finances

Our Finances from a Biblical Perspective

Dangers of Credit Cards

How to Get Out of Debt

CBN's Financial Bootcamp

Keys to Prosperity

CBN Teaching Sheet: Giving and Tithing

Give to CBN

CBN.comThe following comments echo the financial situations many people find themselves in year after year:

"We were using credit cards to make the house payment and the car payment. We were buying food on credit." --- Greg Rouse

"I remember that there were times when we would get calls from the bank and they would say, 'You need to pay this loan.' Right at that time, that was a really dark moment." --- Orin Baertsch

"We didn't know whom we owed or how much we owed. It was just a black hole." --- Diane Turner

"I had found myself in a mountain of debt." --- Jill Haffley

The above quotes are from real people who have experienced the painful struggle of dealing with debt. Greg Rouse lost his paycheck and began relying heavily on plastic for day-to-day expenses. Orin Baertsch and his wife, Janette, were facing bankruptcy after their business failed. Diane Turner and her husband, Bill, owed on their credit cards, and Diane was sure she would have to give up her dream of going to college. And Jill Haffley owed $18,000 in credit card bills and with a teacher's salary struggled to pay it back.

Fortunately, these stories don't end there. There is a happy ending to each of these lives. Amazingly, all are now debt free!

Sound too good to be true? Would you like to know their secret? You might be amazed to learn that all gave their way out of debt. That's right: They learned that the secret of financial success is to give back to the Lord.

But before examining this approach to debt relief, take a moment to evaluate where you stand financially. How do you compare with the current financial state of the majority of people in the United States? Are you spending more than you are saving? Do you owe more than you earn?

THE STATE OF OUR FINANCES

How Much We Earn

The U.S. Census Bureau reports that the median income for United States workers in 2002 was $42, 409, according to their Income in the United States: 2002 report. This figure includes before-tax monies from all sources.

How Much We Save

According to the Bureau of Economic Analysis, the percentage of disposable income that went toward personal savings stood at only 1.8% in November 2003. Many financial planners suggest saving 3-6 months of your income for emergencies. That means if you make $40,000 a year, you should have a safety cushion of $10,000-$20,000. Most people are living from paycheck to paycheck.

How Much We Spend

The Consumer Expenditure Survey reveals just how much we are spending. According to a 2000-2002 survey done by the U.S. Department of Labor, Bureau of Labor Statistics, the average annual expenditures for anything from the basic essentials of food, housing, and clothing to health care, cars, and entertainment was $40,677. That means that only $6,257 remains, or a mere 13.3%. We can then deduce that we are spending 86.7% of our income based on these figures. Either we aren't making enough to keep up with the cost of living, or we are spending way too much!

How Much We Owe

October 2003 statistics from the Federal Reserve show that consumer debt, defined as credit card debt and car loans, has reached a shocking $1.98 trillion -- that means an average of $18,700 worth of debt per U.S. household.

The above statistics reveal consumer debt as a whole. But what about credit card debt specifically? The Associated Press recently noted that the nation's credit card debt currently stands at $735 billion, or nearly $7,000 per household. For those carrying balances, the per capita card debt is closer to $12,000.

Furthermore, the Associated Press reports that 60% of card carriers don't pay their balance in full every month. The fact that Americans are chronically late on credit card payments is also reflected in recent statistics from The American Bankers Association. The ABA Consumer Credit Delinquency Bulletin reported an increase in credit card delinquencies. In the third quarter of 2003, delinquencies were at 4.09%, up from 4.04% in the second quarter of 2003.

OUR FINANCES FROM A BIBLICAL PERSPECTIVE

More than likely you have heard the statement "knowledge is power." This is especially true when it comes to our personal finances. But as Christians, if we ever want to truly reign in our finances so that we can find economic freedom and success, then we need to revise the statement to read "knowledge with wisdom is power," for, ultimately, it is God's wisdom that directs us toward freedom. One of the best ways to gain God's wisdom is through His Word, the Bible. And Scripture has much to say about the issue of finances, as you will see once you have reflected on the following verses below.

Income

The wages of the righteous bring them life, but the income of the wicked brings them punishment (Proverbs 10:16).

Tithing

"Will a man rob God? Yet you rob me. But you ask, 'How do we rob you?' In tithes and offerings. You are under a curse—the whole nation of you—because you are robbing me. Bring the whole tithe into the storehouse, that there may be food in my house. Test and see if I will not throw open the floodgates of heaven and pour out so much blessing that you will not have room enough for it. I will prevent pests from devouring your crops, and the vines in your fields will not cast their fruit," says the Lord Almighty (Malachi 3: 8-12).

"A tithe of everything from the land, whether grain from the soil or fruit from the trees, belongs to the Lord; it is holy to the Lord" (Leviticus 27:30).

"Be sure to set aside a tenth of all that your fields produce each year" (Deuteronomy 14:22).

He who is kind to the poor lends to the Lord, and he will reward him for what he has done (Proverbs 19:17).

Each man should give what he has decided in his heart to give, not reluctantly or under compulsion, for God loves a cheerful giver (2 Corinthians 9:7).

Remember this: Whoever sows sparingly will also reap sparingly, and whoever sows generously will also reap generously (2 Corinthians 9:6).

Now about the collection for God's people: Do what I told the Galatian churches to do. On the first day of every week, each one of you should set aside a sum of money in keeping with his income, saving it up, so that when I come no collections will have to be made (1 Corinthians 16:1-2).

Whoever loves money never has money enough; whoever loves wealth is never satisfied with his income (Ecclesiastes 5:10).

Saving

Go to the ant, you sluggard: consider its ways and be wise! It has no commander, no overseer or ruler, yet it stores its provisions in summer and gathers its food at harvest (Proverbs 6: 6-8).

In the house of the wise are stores of choice food and oil, but a foolish man devours all he has (Proverbs 21:20).

Spending

If you spend yourselves in behalf of the hungry and satisfy the needs of the oppressed, then your light will rise in the darkness, and your night will become like the noonday (Isaiah 58:10).

"Do not store up for yourselves treasures on earth, where moth and rust destroy, and where thieves break in and steal. But store up for yourselves treasures in heaven, where moth and rust do not destroy, and where thieves do not break in and steal" (Matthew 6:19-20).

Debt

The rich rule over the poor, and the borrower is servant to the lender (Proverbs 22:7).

The wicked borrow and do not repay, but the righteous give generously (Psalm 37:21).

"The Lord will open the heavens, the storehouse of his bounty, to send rain on your land in season and to bless all the work of your hands. You will lend to many nations but will borrow from none" (Deuteronomy 28:12).

DANGERS OF CREDIT CARDS

Credit Cards Seem Like Real Money

How often do we say that we have "paid" with a credit card? But have we really paid? The answer is no. We have not paid one cent. We still owe. What we do when we use credit cards is sign an IOU. We promise to pay back everything that we owe. Viewing credit cards as if they were cash is a dangerous mindset, one that can get us into trouble quickly.

Credit Card Debt Causes Stress

Sleeplessness, anxiety, worry, and depression are possible side effects of accruing debt. Financial strain can affect the way you view yourself, God, and your personal relationships. Financial difficulties are also one of the causes of marital trouble.

Falling Behind on Payments Means Owing More

If you are unable to pay off your balance in full each month, you will be paying finance charges at your current annual percentage rate. With APRs averaging up to 17.99% and beyond, it will take a long time to pay your debts. Plus, when you fall behind on payments, you will have late fees to pay as well. In the end, you will end up paying more than you originally owed had you paid with cash or check.

Temptation to Obtain Another Credit Card

Opening a new line of credit is easy today, especially when solicitations end up in your daily mail. The Consumer Federation of America, a D.C.-based non-profit association of more than 300 organizations that seeks to advance the consumer interest through advocacy and education, noted that in a twelve-month period ending March 31, 2002, credit card issuers mailed five billion solicitations, or close to 50 solicitations per U.S. household, making more than $3 trillion of unused lines of credit, or approximately $30,000 per household, available.

With so many opportunities to use credit, it is easier to fall into the borrowing trap. And when you don't have the means to pay, it is even more tempting to use plastic.

Bad Credit Rating

Racking up big payments can affect your future borrowing power -- and that means you could have trouble securing a loan for a car or a house, a business venture, or an educational loan. If your bad credit continues, you might be facing the possibility of bankruptcy.

Bankruptcy

Current bankruptcy filings stand at 1.6 million annually, notes the American Bankruptcy Institute. The ABI also notes a close correlation between household debt and bankruptcy filings. The 2002 statistics show that 16% of our disposable personal income goes toward debt payments. That's a lot!

HOW TO GET OUT OF DEBT

As you can see, the problem is serious, but if you find yourself struggling with debt, there is a way out.

Follow The Law of Reciprocity

One of the best ways to overcome the challenge of spending more than you are earning is to go by one very simple biblical principle -- a principle that Pat Robertson repeatedly recommends because it works: the Law of Reciprocity.

The Law of Reciprocity states that if we give to God, then He will give back to us generously. It might sound backwards at first. You will likely ask yourself, How can I give when I owe so much? But God's ways our not our ways. We do not lean on our own understanding, but we acknowledge Him (Proverbs 3:5-6). As we trust God, giving what He shows us to give, then He will give back His blessing in abundance.

The Law of Reciprocity is clearly set forth in the Bible:

"Give, and it will be given to you: Good measure, pressed down, shaken together, and running over will be put into your bosom. For with the same measure that you use, it will be measured back to you" (Luke 6:38).

"Bring the whole tithe into the storehouse, that there may be food in my house. Test me in this," says the Lord Almighty, "and see if I will not throw open the floodgates of heaven and pour out so much blessing that you will not have room enough for it" (Malachi 3: 10).

God says that He loves a cheerful giver. If that is true, Christians should be excited about giving. But statistics show that when it comes to giving to God, Christians are stingy. The Barna Research Group show that born again adults, who comprise 38 percent of the nation's population, have decreased their giving. In 2002 only 6% of born-again adults tithed, as compared with 14% in 2001 and 12% in 2000. Barna also notes that the proportion of households that tithe their income to their church (a tithe equaling at least 10% of one's income) has dropped by 62% in the past year, from 8% in 2001 to 3% in 2002.

With so few Christians giving, is it any wonder that so many Christians find themselves in debt? But if you employ the Law of Reciprocity, and are faithful in your tithes and offerings, you too can find freedom from debt.

Curious how you can start giving back to God? Consider giving to the work of CBN by becoming a CBN partner. When you do, you will be amazed at what God can and will do for you!

Other Resources:

Financial Boot Camp
Keys to Prosperity
Pat Robertson Teaches on Getting Out of Debt
CBN Teaching Sheet: Giving and Tithing

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