Breaking Free of the Debt Trap
Sermon Transcript
0:00:14.0
I want to begin in 1 Timothy 6:9-10. We’ve been here once before in our study but it’s a good starting place again. Paul writes to Timothy, a young protégé in the ministry. And he says, “Those who want to get rich fall into temptation and a trap and into many foolish and harmful desires that plunge people into ruin and destruction.” He goes to say, “For the love of money is a root of all kinds of evil. Some people, eager for money, have wandered from the faith and pierced themselves with many griefs.” He says some have fallen into temptation and a trap over money. I want to talk to you today about breaking free of the debt trap. You know, there are many perils along to road to prosperity. And there are as many traps to avoid as there are treasures to enjoy. I remember years ago I made a deposit at my local bank. It wasn’t a big deposit, just an everyday deposit. And I got the deposit receipt. And at the bottom of the deposit receipt I saw these words- “Let us help you realize your dreams.” Well, I have a lot of dreams. You have a lot of dreams. And I’m open to anybody to help me realize the dreams that I have. So read on a little bit further, and there were several bullet points there. And it said, “Mortgage loans, home equity loans, student loans, car loans, credit cards.” And what I soon discovered was that there way of helping me realize my dreams was me borrowing money from them. I’m not against bankers or banking or any of that. They do a great service in our culture today. But I learned a long time ago, and I learned from the pages of scripture, you can’t borrow your way to financial freedom. And so God has a different plan for us, and a different way for us to go. He warns us in scripture about wanting to get rich. For that to be such the passionate drive in our beings to want to get rich and to have more money and the things that money can buy. Remember, last week we defined financial freedom as free of debt, free from the love of money, free to give generously, and free to have fun. And today we want to get after the first part of that, the debt thing.
0:02:43.0
Let’s go back to Proverbs 22:7, which tells us, “The rich rule over the poor, and the borrower is servant to the lender.” Remember, last week we said that debt makes you a prisoner of your past. And it does. It enslaves you to the lender from whom you borrowed the money. But debt also presumes upon the future. When we sign a debt obligation—when you sign one or when I sign one, whether it’s a simple credit card or a mortgage loan or whatever it might be—what we’re saying it, “I don’t have the money today, but sometime in the future I will. I hope to.” That’s making a big assumption. It’s presuming upon the future. You may or may not have the gainful employment that you have today to be able to make those payments and so on and so forth. So debt not only makes us a prisoner of our past and it presumed upon the future, but it also, perhaps, limits God’s ability to show us a better plan. And He always has a better plan if we’re willing to look for it.
0:03:48.6
In the Old Testament when you study the nation of Israel, God’s chosen people, God had an economy that He set up for the people. And I was always interested to find this in Deuteronomy 28:12 where the Lord says to the nation of Israel, “If you follow my ways, you will lend to many nations but borrow from none.” God wanted His people to be a creditor nation, not a debtor nation. Well, when you look at the United States of America today, I mean, the richest, most powerful economy on planet earth, we’re a debtor nation. You know who owns most of our debt? (China.) China. That’s right. They bought most of our treasury bills. China owns us. And I love all the attention that our new president has given to China and to fair trade and all of that, but I’d love to be in the negotiation room. Because at any time, given the debt that China holds on behalf of the United States, they could call that debt at any moment. Call it due and cripple the United States. So we’re not the creditor nation that God would desire for His people. America is not the chosen people of God, but principally speaking here, the economy that God set up for His people was not a debtor economy.
0:05:08.1
Proverbs 10:22. I love this. “The blessing of the Lord bring wealth, and he adds no trouble to it.” I don’t know about you, but I want the Lord’s blessing on my finances. Because when I do things God’s way, it always yields a blessing, especially in the area of my finances. When I take the wisdom that He’s given us in His Word and I apply it into my life financially, the blessing of the Lord adds wealth. And He adds no trouble to it. I know a lot of people who are in trouble financially because of the debt obligations that they’ve gotten themselves into. They are a prisoner of the past. They’ve presumed upon the future. Now it’s time to maybe leave some room for God to show you another plan or a better plan. Romans 13:8 says, “Let no debt remain outstanding except the continuing debt to love one another.” Now, it’s important to understand that debt is not a sin. It’s just unwise. From the Bible’s perspective, it’s foolish for all the reasons that I just mentioned. But debt is not a sin. The 11th commandment does not say, “Thou shalt not go into debt.” The Bible just says that when you do, you know, borrower beware. Just be very careful before you enter into an obligation like that. And it’s best, again, if you really want to be financially free, you’re free of debt, free from the love of money, free to give generously, and free to have fun.
0:06:34.4
With that in mind, let’s talk about the five most common financial traps that people fall into. And then at the end of our time together I want to be very practical, very pragmatic. And I’m gonna give you an exercise to show you how to break free of the debt trap if you find yourself in there today. First of all, the five most common financial traps. Number one—and you could probably list this one—is the credit card trap. The credit card trap. The average American today—I just checked these number this week—the average American household today carried $16,000 in credit card debt. Now, there are two kinds of credit card user. There are transactors, and there are revolvers. I’m a transactor. Cathryn and I are transactors. We use a credit card, when we do, for a free 30-day loan because we pay it off in full, the bill, at the end of the month. And as I said last time, I always encourage you, if you’re gonna use a credit card, make sure you have the money in the bank to pay off the bill before you use the credit card. Now, you're gonna be called a deadbeat in the credit card industry, because they want you to be a revolver. They want you to pay that minimum payment. But do you know how long it would take to pay off $16,000 in credit card debt at, I don’t know, 17, 18, maybe 20% interest? How long it would take to pay that off if you just made the minimum payment? It would take you longer than a 30-year mortgage, 33 years to be exact. And when you’re done, you haven’t spent $16,000, you’ve spent that plus an additional $24,000 to $25,000 in interest. Now you know why Visa and MasterCard and all the credit card industry wants you to be a revolver, because they're charging enormous interest rates. And over the long haul they’ve got this cash flow, you know, from people like you and people like me.
0:08:34.4
How do we get into a trap like that? Well, there are a couple of ways. One is through our own consumer spending. Some of us are impulse buyers. We can’t go online or into the shopping mall without buying something. And we’ve bought into the lie that if it’s 50% on sale, I just saved 50%. No, you didn’t. You just spent 50%. All right. How does that work out? We’re impulse buyers. And we haven’t learned the art of delayed gratification. Let me put this in the context of being a follower of Jesus. Jesus said, “If you want to be my follower, deny yourself. Take up your cross daily and follow me.” What does the world say? Don’t deny yourself. Indulge yourself. You deserve a break today. Get it now. Seventy-two easy payments, right? But as financial followers of Jesus, it’s better if we say, “No, I’m not gonna do it now because I can’t pay cash for it.” Let’s delay our gratification. Let’s not buy that new dining room or living room set on credit. Because if you do, in 18 months or so, it’s gonna be a worn out couch. Cushions are squishy now. Dog hair all over it. Little Cheetos stain over here. Who wants to make payments on that? Your friends don’t even want to come and sit on that couch. So, no, you delay your gratification. Sit on the floor for a while. You’ll be okay. And wait, save up, and then walk into that furniture store or elsewhere and pay cash for it. You’ll appreciate it a whole lot more too, and you might do away with the Cheetos along the way. I don’t know.
0:10:20.2
Credit card debt. There is a wonderful new website I found, and it’s called “Nerd Wallet”. What a great website. Sean McQuay is the banking expert there. And he says the other reason we’re in such credit card debt today is because the rise and the cost of living has outpaced income growth over the last 13 years. Most Americans are feeling the pinch today. Our incomes are not keeping pace with the rising cost of living. Median household income has grown 28% since 2003 cmopared to expenses, which have outpaced it significantly, like medical costs that have increased 57%. We all know that, right? But add to that food and beverage prices that have gone up 36%. So you have median household incomes that are rising at this rate, expenses that are going up this. By the way, when the government publishes the rate of inflation, I always…the back side of my hiney gets a little bit burned up when you do. Because they don’t take into consideration these expenses. They tell us inflation is 2 or 3 or 4 or 5%. No, it isn’t. They don’t factor in the 36% increase in food and beverages prices or the cost of medical increasese. The real inflation rate is what we feel the pinch on. And so, as Sean McQuay says, taking on debt to cover the gap between income and expenses is a short-term fix with costly long-term results. As I’ve said to you in weeks past, it takes a second to get into debt. Swipe your card, sign your name on a debt obligation. It takes years to get out. And some of you are in the credit card debt maybe, on average, with $16,000. You’re doing the minimum payment thing. Thrity-three years later and whole lot of money left later, you’ll have that baby paid off. There’s a better way.
0:12:31.8
Jesus said in Luke 12:15, “Take care and be on your guard against all covetousness, for one’s life does not consist in the abundance of its possessions.” The antidote to covetousness is, yes, delayed gratification and the contentment that comes with the present situation that I’m. I can wait. I’m not gonna fall prey to the culture that says, “Indulge yourself. Do it now.” No, I’m gonna be content. I’m gonna push aside covetousness and delay my gratification here. That’s the credit card trap.
0:13:07.3
Second is what I call the auto trap. I told you a story in week one about the auto trap I fell into just a year or two out of college. And I bought an expensive car I couldn’t afford, spending money I didn’t have to buy things I couldn’t afford to impress people who didn’t care. It was the “fake it ‘til you make it” plan that I was on. And I fell right into the auto trap. I was driving myself to the poorhouse. And a lot of Americans are today. Because it’s easy to get into the latest model. I remember Cathryn and I were counseling a couple years ago at a church we were serving in Texas. And they were having troubles making ends meet. We did a spending analysis on their budget and their ins and outs of their money and discovered they had two car payments. Two car payments that totaled about $1200-$1500. Oh, they were driving beautiful cars, late model cars. I mean, the latest in all the technology. But they were driving themselves to the poor house. When you can identify expenses like that, you’ve got a decision to make. And that’s where you need to sell those cars and buy ones that you can afford.
0:14:16.0
By the way, I mentioned a couple weeks that I’d tell you how to pay cash for a car every time. I got a lot of feedback on that one. So here we go. It takes some discipline. Cathryn and I have four cars- one for each of us, as most families do, and then we have two college-age kids. By golly, they need some transportation too, don’t they? They move and groove, so they’ve got two cars. Every one of them is paid off, paid cash for them. And here is how we did it. I learned years ago that if I do this once on each car, I’ll always pay cash for a car. That is, scrape together what you can to buy a car that is mechanically reliable and that you can drive. It isn’t gonna be the car of your dreams. I guarantee you that. And you just drive that baby. You drive it until it drops out from under you. Okay. And while you’re driving it, you’re gonna make yourself a car payment over here. You’re gonna put it in a savings account, an escrow account. Call it your car replacement fund. I recently bought a new car. First one I’ve bought for myself in 13 years. I’ve been putting money aside for 13 years. Cathryn said when she married Ron Jones she didn’t realize. We drive cars for a long time. We do. No, I don’t trade every two years and do that trade up and trade out thing. So my car that...I just bought a new one. My car that I had has, I don’t know 150,000 some miles on it. I know where all the warts are, all the problems are. I don’t want to buy your problems or somebody else’s problems. So my daughter needed a car. That’s hers. I hope it gets her through college, okay. But it’s paid off. It’s paid off. (What car is it?) She wants to know what car it is. Here is what I’m telling you is you make a car payment to your fund over here at whatever pace you want, whatever car you want. And you do that long enough. Then you walk down to the car dealer and say, “No, sir, I don’t want your fleas, or, I’m sorry, your lease.” And you get some defibrillators ready when you say to him, “I’m paying cash for my car,” because that doesn't happen every day. I know, because I have some friends who own car dealerships. And they’re just, like, “Oh, no, we do this car loan thing, and there’s a cash flow to…” No, just go in there and pay cash for it. You're making yourself a car payment. You do that once…you know, you delay your gratification. And then every time, you know, you’re not gonna be paying somebody else the interest on a car note. You’re paying yourself in an interest-bearing account. And you’ll be ahead there.
0:16:47.5
So that’s the auto trap and then the credit card trap. The third one is what I call the mortgage trap. Listen to these words from Nehemiah 5:1-3. “Now there arose a great outcry of the people. ‘We are mortgaging our fields, our vineyards and our houses to get grain because of the famine.’” These are hard economic times during the time that Nehemiah was rebuilding the walls of Jerusalem. This almost sounds like a home equity loan here. They were mortgaging their fields and their homes and their land and their houses just to buy food at the grocery store. Those are hard times. And that cry is going out today, the mortgage cry. Three reasons for it is because, number one, most people buy more home than they can afford. Now, your mortgage lender is gonna tell you, based on calculations they do, that he might lend you up to 35%, I’ve even heard 40% of your household income could go to your mortgage. That’s insanity. That is the definition of house poor. And you know what a house-poor person…house poor means that when I want to go out to dinner on Friday night I can’t because the mortgage is due next week. House poor is when you want to go on that family vacation, you can’t because the mortgage is due. You’re up to here because you’re at 35%, maybe 40%, even 30%. Now, Cathryn and I haven’t always done it right, financially. We’ve certainly made our mistakes along the way and fell into our traps. But I’ll say the best decision we ever made when we got married, when we were what I call DINKs—Double Income, No Kids; wonderful place to be—but we bought our first home off my income, not our combined income. And our mortgage lender kept telling us, “Well, you can afford a bigger house. We can get you into a bigger house.” I understand that. But this is where we started because we wanted the freedom to make some decisions down the road when kids came along and so forth. And we’ve done that on, you know, all of our house, even when we came here to Virginia Beach. We bought a house less than what we could afford, and, you know, (0:19:00.0) just kept it here. A percentage that I’ve always been comfortable with and I’ve taught over the years is a percentage of household income that your mortgage needs to be is less than 25%. Get it closer to 20% if you can, and I say even after taxes. And you’ll never feel house poor as long as you have regular and faithful employment. You’ll always feel like you can manage that percentage from your budget, and you can do some other fun things as well.
0:19:27.3
There are other reasons people are falling into the mortgage trap. Some because they buy one house before they sell the other. A transferee couple from one location to another. I know you want to get settled and into your job and all that. But when you buy one with the idea that, oh, I can sell this one in 45 days or so. My realtor tells me I can, and then 12 months later you’re still trying to sell this baby. And now it’s a fire sale and you’ve lost money. In transition, make sure you sell one before you buy (0:20:00.0) the other.
0:20:01.0
And thirdly, I’m just not a big fan of home equity loans. There’s a lot of that going on today. But you’ve worked hard to build that equity in your house. And one day you need to live in a house that’s paid off, completely paid off, as you get older. And you don’t want to have, you know, one and two or three loans that you’re pulling out of your mortgage. I’m not a big fan of mortgage loans. I am a fan of getting a mortgage in that percentage range we talked about. And there’s no reason why we have to pay it off over 30 years. Whoever came up with that? Add to your monthly principle payment. Buy something that is well below what you can afford, and then add to that. Pay it off in 20 years or 15 years or 25 years. You’ll save tens of thousands of dollars in mortgage interest. The bank will never tell you that. That’s how they make money is off the interest payments. But you, as a smart follower of Jesus Christ who is biblically informed about his finances and wants to break free of the debt trap, you know, will manage it in a way where you can pay off your mortgage sooner rather than later.
0:21:10.6
So let’s review where we’ve been. We have the credit card trap, the auto trap, the mortgage trap. The third one is what we call the tuition trap. College expenses are soaring. I know because I’ve got two kids in college right now. And don’t get me started. The reason they’re soaring is because the government is involved in college loans. Get the government out of the college loan business, and college expenses will get back to a normal rate. But the reason some schools are charging as much as $65,000 a year for a Bachelor’s degree is because the federal government will fund the loans and will make that happen. You’ve seen the thing boil up in me. The average household income or the average household today has $49,000 in student loans. I remember years ago I was in Texas serving a church there. And a young couple that was getting married wanted me to marry them. We went through some premarital counseling. And as I always do, we have a financial conversation. I said, “Hey, do you guys have any debt.” “Yeah, we both have some student loans.” “All right. Well, how much?” “Forty thousand dollars.” And I was sitting behind me desk. I just leaned forward. I said, “Lean in a little bit here.” I said, “When you guys get married…” And these were good kids, just graduated from good universities and did well in school. And they had good jobs. I said, “But as you go forward in life, you need to live like college students. You need to eat beans and weenies every night, and you need to get after this debt and pay it down. Because you don’t feel it right now, but it is a boulder around your neck. And if you don’t get after it now, five years from now, seven years from now, maybe ten years from now, you’re gonna be in my office for some marriage counseling because of the stress that you feel as a result of this and whatever other debt you accumulate along the way.” Cathryn and I are committed to giving our kids a college education, but not where they graduate with a degree in debt. And we decided that more than 18 years ago. When they were born, opened up the college funds. And as best as we can every month, putting something in there. Maybe it’s $25, maybe it’s $50, maybe it’s $75 a month. Whatever you can do. Grandparents, whatever you can help with. Your best friend in building wealth—and this is a biblical principle all throughout the Bible and especially the book of Proverbs—little by little and over a long period of time you build that college fund. You don’t wait until their 16 years old and hope you win the lottery. Because we can talk about gambling and all that stuff that the Bible, you know, doesn't want us to do. But it’s little by little over a long period of time in an interest-bearing…compound interest and time are you best friends. And even then you may not get all the way there.
0:24:08.9
So I brought with me a list of the top ten ways to reduce the cost of college. I won’t go through all of these, but we’ll post these on our website for you. First, apply for a scholarship or a grant. Financial aid will offer you a loan, but you’re gonna fall into the student loan trap. So how about a scholarship or a grant. Our two kids in college, you know, they’re athletes. And scholarships were a part of that, and we’re glad for that. Here is one. Attend a community college for the first two years. You know what Virginia offers? And maybe some other states do this too, but if you attend a community college for two years in Virginia, then you can go…you're admitted to the Virginia university of your choice, including the University of Virginia, which is one of the top schools in the nation. You’ll find it hard to get in there academically. But if you go a community college for two years, stay at home, save up money, you know, save your parents’ money and all that, then you can get admitted to UVA regardless of your grades. Well, I think you have to have a C or better. Okay. But you won’t get in with that kind of grade point just on your own into UVA. That’s a pretty good deal and a cost-saving measure. Attend a college in the state of your residency. In-state tuition is always less than out-of-state. We’ll place this on our website, post it there. But the tuition trap is one that many, many Americans are falling into. And because of that, economists are saying that it’s slowing down other areas of our economy because young people are delaying the purchase of a house and things like that, major purchases, until they pay off those kinds of loans.
0:25:51.3
The fifth one is what I call the co-signature trap, co-signing on a loan. Now, suppose you have a friend, maybe a sibling, maybe a cousin or an uncle that you really love. And he’s got a business idea. And he goes down to the bank, and, well, he can’t get a business loan. But it’s a surefire business. He says, “Man, this is gonna work.” And he comes to you and says, “Can I borrow on your good credit? Because I’ve had some, you know, bumpy times over the years. Can I borrow on your good credit, and would you mind co-signing on this? You know, I’ll handle the payments. This business is gonna soar.” And he wants you to cosign on it. And here is what you need to do. Run, Forest, run. Run as fast as you can. I don’t care how much you love this person, you know, you’re in relationship with this person, how much you care for this person. It might be another church member that comes to you. I don’t know. Run. Run as far as you can from this. Proverbs 17:18 in the Living Bible says, “It is poor judgment to cosign on another’s note, to become responsible for his debts.” No, it’s not a sin. It’s just bad judgment. It’s foolishness. Why? Because you assume all the risk and get none of the reward. And when that person, who couldn’t get a loan from the bank for good reasons, can’t make the payments, guess whose door the bank is gonna come knocking on? Yours. Okay.
0:27:25.9
So on this particular issue, the book of Proverbs speaks at length about the foolishness of being security for your neighbor. For example, Proverbs 6:1-5. And here Solomon is, many say, training up the new generation of kings. And he is directing his comments to his sons. And he says, “My son, if you’ve put up security for your neighbor,”—in other words, if you’ve cosigned on a note—“if you’ve given your pledge for a stranger, if you are snared in the words of your mouth and caught in the words of your mouth, then do this, my son, and save yourself, for you have come into the hand of your neighbor: go, hasten, and plead urgently with your neighbor. Give your eyes no sleep and your eyes no slumber; save yourself like a gazelle from the hand of the hunter, like a bird from the hand of the fowler.” Boy, that’s some strong language, isn’t it? Poetic language that says run, run, run. And if you find yourself under an obligation like that, go to that person and get out of it as quickly as you can. Because, again, you’ve assumed all the risk, and you’ll get none of the reward. And it may all come back on you. So a lot of people get into things like this out of the kindness of their heart. The kindest thing you can do is say, “Thanks, but no thanks. I want to protect my own situation and my family.”
0:28:50.3
I could add a fifth trap, but let me just toss it into an area of concern to talk about. And that is debt consolidation loans. There is a lot of discussion out there in the marketplace about debt consolidation loans. And how that works is something like this. If you have, you know, multiple high-interest consumer obligations, multiple credit cards let’s say, somebody comes along and says, “Listen, let’s consolidate your loans into one simple, easy payment at a lower interest rate.” Sounds reasonable, doesn’t it? Here is the problem. You haven’t addressed the core reason why you got into the financial problems in the first place. The covetousness, okay, and the contentment you need to say no to the impulse buying and so forth. So, you know, what happens is people consolidate their loans. But according to studies, 70% of Americans end up in the worst position two years later. Why? Because once they consolidate their loans, now their four or five credit cards have zero balances on them. And they run up the credit cards again because they haven’t changed their behavior. So three words around debt consolidation: Beware, beware, beware. Okay. The debt consolidator would love to have your business, your interest business, even at a lower rate than the credit card companies. He’s not concerned about whether you’ve changed your behavior or not. So beware of debt consolidation loans.
0:30:19.4
And if you're thinking bankruptcy is the way out of your financial troubles, let’s just remember what the psalmist writes in Psalm 37:21. “The wicked borrow and do not repay, but the righteous gives generously.” Remember, as followers of Jesus Christ, we want to do our finances God’s way. And when we assume a debt obligation, our integrity as at stake. We’re making a promise. The God of the Bible is a promise-making and promise-keeping God. When He makes a covenant, makes a promise, you can literally go to the bank on it. And He expects His followers to do the same. And I understand we have bankruptcy laws, chapter 11, chapter 7, chapter 13, whatever chapter you want to choose. And there might be a time to reorganize your finances according to those laws. But let’s remember as followers of Jesus Christ, we’re held to a higher standard of integrity. The wicked borrow and do not repay. They walk away from their obligations, maybe even legally so. But the righteous gives generously. The implication is they not only deal with their debt obligations with integrity, but they manage their finances in a way where they’re free of debt, free from the love of money, free to give generously, and free to have fun. And let that be true of us as followers of Jesus Christ.
0:31:49.3
Now that we’re all heavy-hearted under the weight of whatever debt obligations that we have, let’s talk about a practical way to break free of the debt trap. And I want to use something I call the debt snowball plan. Now, I didn’t come up with this plan. Dave Ramsey talks a lot about the debt snowball. He didn’t come up with it. This is a financial planning deb elimination tool that has been around for a long time. It’s just based on some simple calculations. But the debt snowball…they use a snowball because we’re going to “snowball” a payment across a number of different obligations until we get them all paid off and, in the process, accelerate it. Let me give you five steps, five simple steps to doing this. Let’s assume you have, I don’t know, three or four or five consumer debt obligations. We’re not talking about your mortgage, but credit card debt or a furniture payment or an auto loan or a student loan or something like that. First of all, list your debts smallest to largest. Don’t worry about the interest rate. We’re gonna get after the smallest first because we need some immediate gratification here. We need to know that we’re winning, that we’re knocking some of this out, all right. So list them smallest to largest. Second, you’re gonna make minimum payments on every one of these debts except the smallest. On the smallest debt we make the minimum payment plus an extra payment or an extra amount until the entire debt is paid off. I’ll come back to that in a moment. And then once that debt is paid off, we’re gonna roll what we were paying off that extra amount, plus the minimum from the first one. Roll it into the next smallest debt’s minimum payment. And we keep doing that until all the debts are paid. After each debt is paid off, we’re gonna engage in some plastic surgery. We’re gonna cut up our credit cards. And then we’re gonna celebrate by shouting, “Woo hoo.” All right? Now, we’re not gonna celebrate by going out and spending money. We’re just gonna celebrate by shouting, “Woo hoo.” So let’s try that. Ready, 1, 2, 3… (Woo hoo.) All right, you’ve got to celebrate more than that. Come on. Like you really mean it. 1, 2, 3… (Woo hoo.)
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All right. Let’s put an example up on the platform here, and let’s get after some numbers. Let’s say you have five debt balances. Two of them are credit cards, one is a car payment, and the last one there is a student loan. The balances are 1500, 2500, 7000, and 10,000. You see the minimum payments listed there- 50, 75, 185, 97. You just make minimum payments, it’ll be decades before you get all that paid off, right? So we’re gonna make an extra payment. And you say, “Okay, Pastor, that’s my problem. Where am I gonna find the extra money?” Well, you’re gonna go back to your college days when you lived on beans and weenies. And you’re gonna pour through your expenses. You know, it’s a whole lot cheaper—this is just one example—but a whole lot cheaper to eat at your house and fix it at home than it is to go out. I had a birthday this week. And Cathryn and I went out to my birthday dinner and went out to a nice restaurant. And, you know, we always both kind of choke over the cost of eating out today. Funny thing was I paid for my own birthday dinner too. But that’s a whole other story, all right. But we both paid for it, but, you know, I…the next night she cooked me dinner. You know, we have this thing in our house where she cooks and I clean up. And she always does a great job. She’s a great cook. And the food was just as good if not better than the nice restaurant that we went to. But she says as we were cleaning up, she says, “You know, this is great. We ate for $7 tonight, the two of us.” You know, you can’t do that at McDonald’s, you know. And we had wonderful food. So you’re gonna find a way to reduce the expenses in your budget. And if you can’t find a way, then you’re gonna get a second job. You’re gonna work nights, weekends. You’re gonna get after this like a gazelle.
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And let’s say you found $500. We’re gonna take the minimum payment plus $500. Now we have $550 a month to get after that first debt of $1500. While we make minimum payments on the rest, we’re gonna pay off that first one in three months. We’re gonna have some plastic surgery, cut up the credit card, and shout… (Woo hoo.) Great. And then we’re take that 550, and we’re gonna roll it into the next one- 550 plus 73 is 623. It’s gonna take us about four months to pay off $2500. And when we do, we’re gonna have some plastic surgery, cut up that credit card, and shout… (Woo hoo.) And then we’re gonna take that 623 and roll it into the car payment we have, which is 185. And now our total is 808. It will take us about nine months to pay that off. And when we do we’re gonna rip up that debt obligation and shout… (Woo hoo.) And then we take the 808 and roll it into the student loan payment of $97 a month for a total of 905. That’s gonna take us about 11 months to pay it off, and when we do we’re gonna shout… (Woo hoo.) We just paid off $21,000 in debt in 27 months. If you make the minimum payment on $16,000 of credit card debt at 17, 18% interest, how long did I tell you it would take? Thirty-three years. This is the debt snowball. Somebody needs it out there. And that’s how you break free of the debt trap. Simple little tool. It takes some discipline. It takes an agreement between a husband and wife to say, “We’re gonna get after this. We’re gonna sacrifice what we need to sacrifice so we can be free of debt, free from the love of money, free to give generously, free to have fun, and experience the freedom that God wants for us.”
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By the way, what does all this have to do with the cross of Jesus Christ? Anything? It does. Because God wants us to be free. There was a sin debt we were piling up before a holy God. You know how I know that? It’s because when I listen carefully to the last words of Jesus on the cross that are scattered throughout the Gospels, I hear Him say things like, “Father, forgive them, for they know not what they do.” I hear Him say, “I thirst.” I also hear Him say, “Tetelestai.” He borrowed a term from the financial marketplace. Because if you were doing business in the marketplace and you finished paying off your obligation, the creditor would stamp your bill “paid in full”, tetelestai. Interesting that that financial term comes from the cross. Because there was a debt obligation you and I were piling up before a holy God, an obligation higher than a Montana sky. And even if we could pay God off, which we can’t, our bank account is so puny compared to the debt obligation we couldn’t pay it off even if we tried. So the Bible says, “By grace you have been saved through faith, and that not of yourselves, it is the gift of God, not of works lest any man should boast.” And so Jesus went to that cross. And, as it were, He took out His checking account. And He has unlimited resources to pay off your debt obligation and mine and yours and all of us in this room. And with His own body and with His own blood, He paid it in full. (Woo hoo.) Now, if you were $21,000…yeah, that’s “woo hoo.” If you were $21,000 in debt with all these credit cards, and some generous benefactor came alongside you—somebody who loves you more than you could possibly imagine—and he wrote a check for, oh, $23,000, would you be so foolish as to spit in his face, to mock him, to even nail him to a cross? No, I hope that you would gladly receive his generosity. The Bible says, “All have sinned and fallen short of the glory of God,” and, “The wages of sin is death, but the gift of God is eternal life through Jesus Christ our Lord.” He wants something for you, not from you. And He’s already gone to the length of paying off your sin debt in full. He wants you to be free from the penalty of sin, from the power of sin to enslave you, one day from the very presence of sin in a place called heaven, His home, the Father’s house. He invites you to come by faith.
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But even before we’re rescued from the presence of sin, He wants us to enjoy freedom in this life, even financial freedom the way we defined it from the scriptures- free of debt, free from the love of money, free to give generously, free to have fun. It all starts at the cross though. Don’t miss that. Don’t just take the benefits from the wisdom of God without starting in the starting place we all need to be. It’s far more important that your sin debt is taken care of than your credit card debt. But either way, let’s break free, break free of our sin debt, our financial debt, whatever it is, through faith in the Lord Jesus Christ and following God’s wisdom today. Amen? (Amen.) Woo hoo? (Woo hoo.) Let’s pray together.
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Father, thank You for Your Word. Thank You for giving us just wisdom in this book called the Bible, even financial wisdom. Thank You for the financial language from the cross to remind us of the sin debt that we had piled up before a holy God. And thank You for Jesus, who out of the generosity of His own heart, through His own infinite resources, paid in full the penalty of our sin and wants to set us free from the power and the bondage of that sin over us. Father, the devil is crafty and wants nothing more than to enslave us. And if he can do that financially, he’s got the upper hand. But today, Father, we declare what You’ve promised in Your Word, these principles from scripture. And we desire them to be true in every one of our lives here today. I pray that if there is somebody that has not trusted Christ as his or her Savior, that today would be a day of salvation. That their first steps would come to the cross. They’d deal with their sin debt through a generous Savior who paid it all, and then move on to freedoms in this life that we’ve talked about. And I ask this in the name of Jesus our Savior, amen.
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