More thoughts on debt
1. I consider "debt" to be something you cannot (or would be challenged to) repay all at once. This would not include your power bill, etc. (unless you have a REALLY BIG power bill...) Things that you regularly pay to zero would not be debt in my opinion. Things that you finance for months or years would be debt.
2. I am REALLY challenged to think good thoughts about churches and debt. As a primary example, the congregation we attend. In my humble opinion, we are COMPLETELY HAMSTRUNG by our mortgage. We cannot add needed staff. We really cannot manipulate the budget in ANY significant way - because over 80% of the budget (as I understand it - was it closer to 90%?) goes to the mortgage. Is it good to have a building? Honestly, I have to say "maybe." It depends on how the building is used, and how it helps or hurts ministry and the calling of the church. (I know that is a nebulous answer, but I'm comfortable with that! grin) It is admittedly hard to build anything in the Atlanta area due to costs, but I'm speaking from a more general perspective. Is this the sort of "investment" that constitutes good stewardship? (I am not implying anything by asking this question. I am simply asking a question.)
3. As we have worked our way out of most of our debt - only our mortgage remains - we have experienced an ever-increasing feeling of freedom. Yet I can hardly wait to get this house paid off! It is one of my early goals to pay off this house from stock market gains. Some will argue that this is not good from a tax-consideration perspective. I am more concerned with eliminating the debt than having a tax advantage - at least at this point. I'll work to have other tax advantages as I grow to that point of need - but at this point I would not plan to take on significant debt as a tax advantage.
I am NO FINANCIAL EXPERT - but the sense of "bondage" due to debt cannot be ignored.
I look forward to reading your thoughts on this. Thanks for the discussion.
2. I am REALLY challenged to think good thoughts about churches and debt. As a primary example, the congregation we attend. In my humble opinion, we are COMPLETELY HAMSTRUNG by our mortgage. We cannot add needed staff. We really cannot manipulate the budget in ANY significant way - because over 80% of the budget (as I understand it - was it closer to 90%?) goes to the mortgage. Is it good to have a building? Honestly, I have to say "maybe." It depends on how the building is used, and how it helps or hurts ministry and the calling of the church. (I know that is a nebulous answer, but I'm comfortable with that! grin) It is admittedly hard to build anything in the Atlanta area due to costs, but I'm speaking from a more general perspective. Is this the sort of "investment" that constitutes good stewardship? (I am not implying anything by asking this question. I am simply asking a question.)
3. As we have worked our way out of most of our debt - only our mortgage remains - we have experienced an ever-increasing feeling of freedom. Yet I can hardly wait to get this house paid off! It is one of my early goals to pay off this house from stock market gains. Some will argue that this is not good from a tax-consideration perspective. I am more concerned with eliminating the debt than having a tax advantage - at least at this point. I'll work to have other tax advantages as I grow to that point of need - but at this point I would not plan to take on significant debt as a tax advantage.
I am NO FINANCIAL EXPERT - but the sense of "bondage" due to debt cannot be ignored.
I look forward to reading your thoughts on this. Thanks for the discussion.
posted by MichaelPolutta at 9:06 AM
6 Comments:
Before I say anything else, I have to share that I just opened my Bible to hunt for a verse about this and happened to open to Proverbs (just to get my Bible open before I flipped to the NT), and what verse do you think is smack in the middle of the page? Proverbs 22:7 "The rich rule over the poor, and the borrower is servant to the lender." Woah! I promise I didn't look there on purpose! Now, I know that is just stating a fact and is not necessarily saying that you should not borrow money, but I just thought that was really weird...
***DISCLAIMER: I know I am not perfect and I don't have all the answers. I can't say for CERTAIN from the scriptures whether or not debt is wrong, BUT I feel like it is because of the other things that go along with it (lack of patience, not trusting that God will provide, etc.). My aim is not to judge the actions of others, but I do think it is good to examine these things from time to time...***
Anyway, the passage I was looking for is John chapter 4 when Jesus talks to the Samaritan woman. Based on verses 19-24 (about worshiping neither on the mountain nor in Jerusalem but worshiping in spirit and in truth), we know that WHERE we worship is not as important as HOW we worship. So, the church BUILDING shouldn't be that big of a deal. Yes, obviously if we are all going to meet we need to have a place TO meet, but it really doesn't make much difference WHERE that is. (Okay, your elders probably won't want you to meet in a bar, but that's a different topic altogether). :)
Having said that, I go back to my previous comment about patience. I personally believe that a congregation should NOT go into debt to buy land or buildings if they can find a different place to meet (a school, a hotel, etc.) for a while until they can save up enough money to buy something outright. Yes, it might be inconvenient, but it is better than not having money to give to the poor because you are still making huge payments on the building. Also, people have HOMES (the places where they broke bread together in the New Testament. We tend to forget about that... although they did meet in the temple courts as well. See Acts 2:42-47). Members can meet in each other's homes and do a lot of the same good things that could be done at the building, although not with as many people, obviously. I think a "church building" can be a very wonderful thing, but, in general, I feel that we put WAY to much emphasis on the BUILDING and not as much on the people inside and OUTSIDE of it.
You mentioned the feeling of freedom that comes from not having debt. YES, that is a great feeling. Especially since I stopped working, I would not say that Tommy and I have a lot of money by any means (except in comparison with people in poorer countries), but because we barely have any bills (no "payments" on cars, etc.) sometimes it FEELS like we're rich (not ALL the time, of course, but we definitely have a lot more freedom with our money than a lot of other people who make more money but are deep in debt). However, since we're in an apartment, we still have to pay our rent, but we dream of one day owning a house outright and not having to make ANY payments for our living space. That extra money back with interest from the bank would be VERY helpful, and we would be able to GIVE so much more. Granted, if we don't give NOW while we have little, we certainly won't give more if we have a lot. It is better to get used to the idea of giving a certain percentage now so that when the actual amount of money we have goes up, the amount of money from the percentage we give will go up, but it won't "hurt" as bad.
As far as tax advantages, I agree... I really don't think higher taxes would matter as much if you were totally not having to make ANY house payments. At that point, I would think that you would have more money freed up for investments that would make enough money to cover your taxes. But, I honestly don't know what the numbers would be, so I can't say for certain.
One more thought before I stop. What do you think about Luke 6:27-36? I'll just hit the highlights here: "...Give to everyone who asks you, and if anyone takes what belongs to you, do not demand it back... And if you lend to those from whom you expect repayment, what credit is that to you? Even 'sinners' lend to 'sinners,' expecting to be repaid in full. But love your enemies, do good to them, and lend to them without expecting to get anything back..."
I'm completely agreeable with the church building issue, at least to a point. Here in AmSam, we currently do not have our own building. But, becuase we're too large of a congregation to meet in one house, we're forced to rent a building on Sundays.
So, in some ways, we're wasting money by paying rent. In other ways, we're trying to save in order to build. It will be extremely gratifying the day we finally begin construction. Certainly a building gives some credibility to your ministry... at least in the eyes of the community.
Does our congregation NEED a building? Absolutely not. Will it help out our ministry? Absolutely.
Go ask Garnett coc in Tulsa about taking a bigger mortgage than you can chew. I'm sure they regret their decision to build a mega-building 20 years ago. However, I can think of a number of churches that have made money because of their property investment (Aiken coc, aiken sc; eastside coc, nyc, ny) Many of these churches were able to build new facilities because of their decision years ago to take out a mortgage on faith.
In regards to delineation of debt, I prefer to value debt based upon the security. Unsecured debt (credit cards, student loans) is horrible and should be avoided as much as possible. It offers no advantage whatsoever, other than immediate gratification. Secured debt however, can be extremely beneficial, so long as the security is worth more than the debt. You begin having mass problems once the promissory note value becomes greater than the security value.
More often than not, secured property investment/debt is stable. Usually the property value increases. However, this is obviously not a guarantee. Any secured debt arrangement must be carefully scrutinzed... especially when it comes to devaluating assets (i.e. cars or anything else that explodes).
I still believe that debt is ok, so long as it is managed properly. Taken to the extreme, it presents a trap and a distraction from God, just as alcohol, television, or any number of things. It's great to be without debt, but I wouldn't cast debt, in and of itself, as a sin.
As a side note, a young samoan woman with a catholic background is studying the bible with us and began asking if all coc's believed the same thing. I indicated that it was ok to have differing opinions, and that even earlier that day I had a different opinion with a couple of people 6000 miles away on an internet discussion. She was blown away... both by the fact that coc was not uniform, and by the fact that I was discussing bible issues with those on the east coast.
later,
Just my 2 cents on debt. As I see it, although debt is mentioned many times in scripture, it is never seen as a positive or a blessing. I would even go so far as to say that it may fall under the category of things (like divorce under the OT) that God allowed as a concession to our "hardness of heart." A parallel might be the use of alcohol, where misuse is delineated as sin, and many people therefore avoid it altogether or in varying degrees not explicitly laid out by scripture so as to avoid falling into the trap of misuse. As one who has fallen into the bondage spoken of in Proverbs 22:7, I prefer if I err to err strongly on the side of caution in that area. That said, I agree with Philip that debt secured by an appreciating asset worth more than the note is, in our culture and economy, often a wise choice. In my world, that basically is a mortgage, with a big down payment and a monthly payment similar to what you'd pay for rent anyway. That's the only debt we have right now, and it not only feels great, it frees us up to better stewards of the blessings God allows us to have--to give, to take care of our family, to work jobs that allow us to be at camp, etc. For us, the trick was to break the cycle of always wanting what I've heard called the B-B-D (Bigger, Better Deal). After trading "up" in house a couple of times, always with a bigger house, a bigger debt, and a new 30-year note, we finally cashed out, paid everything off and bought a smaller place that cost less and came with shorter term. But being content (like Paul talked about)is one of the hardest, most countercultural things for us to do in the USA today.
Philip,
I must say - I've never made payments on anything that explodes! (unless you count "internal combustion engine" explosions)
mp
Mike,
Yeah I'm mainly referring to internal combustion. Car, tractor, or even Civil war cannon... whatever. Repetitive explosions simply can't be good for the longevity of any contraption.
1- Prepare for lean times:
What if (and i do mean IFF) the families of the Most High decided to do something like use wisdom in how to manage the "church's" assets (LOL... as if they owned it!).
For example: In the HOUSE of the wise are stores of Choice Foods & Oils!... so why not build an emergency supply of these things... or what if we also put together an Emergency account equal to about 3 – 6+ months of the church's expenses? Call me crazy, but that sounds like it would be called "Wisdom."
Now... i must admit, i kinda ripped off that "emergency fund" from another source... no, not Dave Ramsey... but he's on cue, too! Rather, Proverbs 27: 12 says: "A prudent person foresees danger and takes precautions. The simpleton goes blindly on and suffers the consequences." The Boy Scout in me states it simply: BE PREPARED!
Depending on their size, churches should start by saving up about $5-10k as a base emergency fund, then pay off the debt... then build to 3-6 mo expenses. This is actually pointed directly at many churches (without apology) QUIT WASTING MONEY ON STUPID FLOWER ARRANGEMENTS AND DECORATIONS! Trust me, they burn.
By the way... for yon camp people, let it be noted that shortly after the Preparedness verse states: A loud and cheerful greeting early in the morning will be taken as a curse! (Proverbs 27: 14) i.e. don't wake others up with your overly, hyper-happy "Glad to be at PBC" voice at 6:00 am. ;^)
2- Be debt free!
Pardon my forthrightness. My teeth & claws bear when I think about debt. Still a recent memory.
Well, we've already basically discussed that debt is voluntary slavery in so many words. Whether it's buying cars (one of the most rapidly depreciating items we purchase), houses or church buildings. Am I so ridiculous to think a church could buy a building without borrowing money? ABSOLUTELY! Will it be easy? ABSOLUTELY NOT! But what worthwhile item has EVER been easy? Name one!
I'll blatantly state: DEBT IS STUPID. There is NO form of DEBT that is an intelligent device. NONE. There is NO positive mention of debt in scripture. Debt for cars is tantamount to flushing money down the toilet. Debt for houses is still dangerous, even though real estate CAN increase in value. (Yes. CAN, not will.)
And for those who are going to try to say that the Parable of the Talents is positive mention of debt, realize that those people were EMPLOYEES and ASSET Managers. And we all know what happened to the Employee who wasn't doing their job: they got FIRED.
So for the church that is "Throwing" money away by renting, why not consider saving up a portion of the contributions for the purchase of a building. The Smartest way to purchase anything is with CASH. You'll get a better deal. If you cannot do cash and still insist on foolishly borrowing money, then go for the SHORTEST term possible and pay as much as possible above the bill each period! If your church cannot save money, then consider it your part to GIVE more. Start by giving at LEAST 1/10th (and don't give me that the tithe is not something we do!)
Now the question: once a church gets their pretty building, will they be willing to dirty it? Will they welcome muddy shoes? dirty kids? homeless? smelly people? Will they welcome the least, the lost and the last? The question is, to whom does the building belong? The elders? or to the one who would send out people to gather the "street urchins" to populate his party?
So that it's clear, i want to make SURE that I get across that DEBT IS STUPID. I hope that's not too vague. Now, people who are IN debt aren't stupid... their actions & choices are stupid. If that offends, my apologies for seeming offensive. If you'll stop doing dumb stuff, you'll be less offended. PAY IT OFF, SAVE AND PAY CASH. oh, and stop whining.
3- Give
One point most churches hit less than they should: GIVE. I believe FIRMLY in the tithe. It was instituted NOT as a matter of the "OLD COVENANT." Rather, it was first seen by Abraham when he gave 1/10 to Melchizedek before the first etch on a stone tablet was made. We later see that the tithe was incorporated into standard Jewish giving such that it is naturally assumed as something we should do as followers of the Most High. Even Jesus stated we should continue in our tithe in Matthew 23: 23 (You should do BOTH: Tithe & give justice, mercy & faithfulness). In fact, many of the pagans & egyptians actually gave 1/5 (that's 2 tithes) to their temples & gods.
Truth be told, many don't tithe.. Once people begin to grasp the tithe, they ask the next question: Do I tithe on the Gross or the Net? Let's see... did the Father sacrifice an Angel or his Son? You decide... but if you're not Tithing, then you're not even on a plain to give an offering above the tithe. I like how a friend (Tim Lucas of http://www.liquidchurch.com) stated that the tithe is like the 10th floor on a tall building. It's simply a starting point to places beyond. By no means look at the tithe as a maximum... look at it as a starting point. Most people who call the tithe legalism aren't tithing anyway.
No, tithing's not a salvation issue.
4- Save & Grow
The parable of the talents is a clear picture that we are to GROW that which we've been given. It's no time to be shy. You've got to build. You've been given the ability, supplies & direction... now it's time to put the power, love & self-discipline to work. As you build, you'll have the resources to welcome more people to the family. You'll be able to give more! One day, there will be a legacy with your name on it. Not one legacy was ever built without giving. Oprah, Mother Theresa & Oskar Schindler have legacies because they Gave.
I guess the point of giving becomes a point of reflection. We give because G-d loved the world so much that he gave. But we split hairs over amounts rather than gratefully giving.
But we can't give when the bank could oust us for late payment. When you go to work in the morning, why do you work? For the money? Isn't it a shame that we (I, too) work for the wrong boss? Money sucks as a boss.
well, yet another long-winded oration of the Goode kind.
Post a Comment
<< Home