But make no mistake about it. It does effect us! Our country's debt problems and economic woes are only a reflection of what most of us are experiencing in our personal finances. Several years ago this country issued bailouts to some of the biggest industries in the world: the auto makers and mortgages lenders. But where did the money come from for the bailouts? Some of it came from you and I, John Q tax payer, while the rest was borrowed money! Get that, borrow money to pay off bad debt on other borrowed money! But before we get too judgmental, how many of us have done the same thing? For example, a credit card gets maxed out and another offers to transfer the balance at a reduced rate or call up a friend or family member to borrow money to pay a credit card. Borrow money to pay on borrowed money (see the excerpt below from my book 12 Pillars and a Prayer). The result is Fool's Gold designed to make us feel better for a season but makes no real progress on the real problem: our thinking about money is messed up and our money management is out of control.
This blog, named for my recently released book by the same name (12 Pillars and a Prayer) is dedicated to getting our thinking right about money. It is designed to be practical, real and founded on Biblical teaching about money, wealth, success and prosperity. I've been living these 12 Pillars for almost 7 years now. They have permeated my entire life and guide my thinking about money. They are powerful passages from the Bible that when applied to all areas of my finances, have led the way for me to become completely debt free. No, I'm not there quite yet, but I'm on the right path to obtain debt free living in the very near future. The entire process didn't start with getting a better paying job or eating peanut butter every meal for a year. It came by changing the way I thought about money. Now that I am no longer swimming in a pool of debt, it is my desire to see others overcome their economic bondage and live debt free. To do so changes our world. I begin this journey of sharing the 12 Pillars with others by asking a simple question: How would your life be different if you had no debt? What would change in your relationships? Would life suddenly become more rich and full, as you no longer were slave to the creditors? Would you be in a better position to help others? And what about your own desires to spend? What if you had a better handle on why you spend money you don't have and in the process remain a slave to debt?
All of these questions will be discussed in this blog. Each week I will post to the blog either stories that from my own life or from the lives of others (names will be changed to protect their identities). We will begin this blogging journey with a story from 12 Pillars and a Prayer. This is a true story that illustrates just how far our thinking becomes when the financial pressure begins to mount. I hope you enjoy and encourage each of you to comment or contact us and share your story! You contact us at askdrt@simplesolutions4.com or leave your comments directly on the blog site.
Pillars built on fault lines aren’t very stable!
…owe no man nothing but to love him..!
Romans 13:8
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t was 15 years ago when I traveled to a conference with a friend and coworker. Let’s call him Ron. I listened carefully as he began to lament his financial woes. I was completely caught off guard by what he told me.
Ron was a sharp looking young man, bright and came from a nice family. He had just finished his medical school training at a prestigious private university and was waiting to hear from residency programs. He had published some of his work in a peer reviewed medical journal. Ron seemed to have it all going for him. I assumed him to be of reasonably sound mind and emotionally stable.
“I don’t know how we’re going to pay our bills,” Ron told me as he gazed out of the passenger side window at the vibrantly colored western North Carolina Mountains. It was late fall and the iridescent mountains captured the majesty and radiance of God’s creative nature. Ron, on the other hand, was anything but radiant as he proceeded to tell me about his financial woes.
“We owe over $40,000 in credit card debt alone!” he confessed at one point. “We are months behind on our car payment and the bank is threatening to repossess any day.
“Sally is about to divorce me and will hardly speak to me. Our sex life is non-existent, and I haven’t had a good’s night’s sleep in months.” Ron’s countenance sank to despairing lows as he continued to share the gory details of his shipwrecked finances.
The more Ron talked the worse it got. It became obvious that he was totally demoralized. In spite of the successes he was enjoying in his career, Ron saw himself as a complete failure and inept leader in his home. His self-esteem was completely shot. Attempts to regroup himself were met with poignant reminders of his failures either from a hostile bill collector or his wife, who was obviously crushed by his clandestine spending habits. And to top it all off, Ron lamented that if his medical school found out they would not graduate him because of an ethical standard agreement he signed when he enrolled in school. While I had never heard of such a thing, apparently the contract required students to remain financially solvent throughout their education. Ron’s anxiety was over-the-top. His peace was thrown out the fiduciary window. And he saw no way out other than bankruptcy which would most certainly end his promising medical career.
As Ron and I discussed his situation, I learned more about how he came to be in such dire straits. Initially, he had received an offer to receive a credit card. It had a low spending limit that he quickly maxed out with a purchase or two. He made a few payments and the next thing he knows the company upped his credit limit. The process repeated itself several times until his spending limit was up to $10,000!
Next, while barely making his minimum payments, Ron was offered another credit card with a balance transfer option that offered lower interest rates. “That makes sense. I’ll get a lower interest rate and pay this mess off much quicker,” he thought to himself. So off he went, with a plan. He transferred the balance but somehow derailed from the plan and failed to shut down the first account. He then used the first account again and the next thing he knows, he’s maxed out two cards! Then the process repeats itself a couple more times until he now has six credit cards, all maxed out! At this point no one is offering him credit and the nightmare begins. Exit freedom and joy; enter bondage and anxiety.
Let’s just stop for a second and think about Ron’s logic for a minute. Ron is trying to use borrowed money to pay off debt! Sounds crazy, right? But wait a minute. This logic is immensely popular in today’s world. The logic strikes a current day chord. Many of the country’s stimulus package plans and bailouts are based on the same logic! It goes like this: let’s borrow money to pay on bad debts that people can’t afford pay in the first place! Huh!!!?
I have to admit that as I heard Ron’s story I wondered exactly how someone could wake up one day with over $40,000 of credit card debt. At that point of my life, I’d not had so much as a single late on my credit report. I found myself struggling to be non-judgmental and not become condescending in tone. But, as I would later learn, Ron’s story is not all that uncommon. “What goes around comes around” as the saying goes. Perhaps my numbers weren’t as high but they didn’t have to be and neither does yours. If you can’t pay your bills you can’t pay your bills. You have become a slave to your finances. The tail is wagging the dog and your life is reduced to chasing the almighty dollar. Your true wealth is threatened and your life is now an uncomfortable, paralyzed existence. It’s not what you wanted; certainly it’s not what God wanted for you, but here you are now firmly entrenched in the world of S&B …slavery and bondage! Slave to your lender; bound to your debt. Your credit rating is slipping and your world is changing as you insidiously lose your freedoms. You no longer get the best interest rates and your cell phone company wants a large deposit before they’ll open an account. Good sleep is hard to come by and it’s hard to look into the mirror, much less the eyes of your spouse, and muster up a good feeling about yourself!
excerpt from 12 Pillars and a Prayer by M.Russell Thomas, PhD
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