We are no novices in sharing financial principles, having walked numerous families through financial nightmares at pretty deep levels. We've been in the trenches with them and seen some patterns repeat themselves. We've written three booklets on the topic that contain summaries of many principles taught in financial seminars and books, but through these booklets people can have this information quicker and easier.
The bottom line?
- You never want to be in debt to anyone, whether it be for ten dollars or a thousand, because all debt presumes on the future.
- Debt presumes that the economy will stay the same.
- Debt presumes that you will have a job.
- It presumes that you will still be healthy enough to work for the full duration of time needed to pay off the debt.
- It presumes that you won't be in an accident that curtails your earning power.
- It presumes that there are no power outages, layoffs, or national emergencies.
- It presumes that even if you do work, you'll have extra to use to pay not only current bills but pay loans back. Almost no one ever has extra. Our banker tells us that most people live hand to mouth and that families with actual savings accounts with anything IN them are rare.
- It presumes that you can take prolonged chronic financial stress. Just carrying the knowledge of your own debt sabotages your sleep, your motivation, your energy, and your moods, and creates guilt, remorse and depression.
- It does not allow you to follow the Lord fleet-footedly, should unforeseen opportunities present themselves, because you are trapped in prior self-made commitments.
Further, debt wrecks relationships. No one ever loans money without a subtle hovering expectation that goes with it. You don't get out from underneath that steady gaze/ requirement/ censor of you until you've paid the last dime.
Remedy: the faster you want to get out of debt, the more radical your actions must become. There are only two variables you have to work with: making more money around the edges and spending less. That's it. That's the secret formula. Increase your income and/or cut your expenses down to bare bones. This is financial gravity. No one defies gravity. It is fixed. There is no such thing as financial "instruments" in the Bible. The current condition of the United States proves it. The party is over.
The fastest route to cash in your pocket by nightfall? Sell everything you can part with, that you will not have to turn and around and re-buy. Sell it on Ebay, on Craig's List, and/or by word of mouth and posted on grocery store bulletin boards. (Work at this online selling and notice-making after you have job hunted all day, when you are exhausted. Do this work around the edges of wage earning hours, because "the hand of the diligent will rule.") After you get a job, pick up additional work around the edges whenever you can get it—babysit, clean houses, stuff envelopes at home—do sit-down, less physically taxing, more mental jobs—etc. Get rid of any luxury or anything kept for emotional warmth, if it costs you even a dime to keep. That includes pets. You can have all this stuff back again after you are out of debt. Cut your repeating monthly expenses to almost nothing. Find out some way to not even pay rent, if you must. House-sit.
Go after debt like a bulldozer. When you've paid off the last dime, throw a party. Being totally out of debt will feel delicious. It is worth every sacrifice to achieve that state as quickly as possible.
For more on this topic, read our In Dire Straits, and also our booklet of Sure Financial Steps for Beginners.
