I read Dave Ramsey's "Straight Talk About Debt" article in the Jan/Feb 09 issue of Relevant over the weekend. Understand that I am not a Dave Ramsey cheerleader. However, his message about eliminating debt is good stuff. The line that really stung me in this article is in the section titled "Our Culture." Ramsey is talking about imitating people you want to be like. So if you want to be rich, imitate rich people. He notes, "I have met with thousands of millionaires in my years as a financial counselor, and I've never met one who said he made it all with Discover Card bonus points." Ouch. I've been suckered. I totally bought into the idea that I'd fund my dream vacation house with bonus cash I accrue with my plastic. And what happened? I overbought, carried a balance, and now the card company is making money off me. Stop for a second and think about how much money you currently pay in interest on your debt. Think about what good could be done in your community with that dough. Ramsey quotes a figure of $962 billion in US consumer revolving debt as of May 08. Let's assume an average APR of 5% on that debt, which we all know is low. That's $48.1 billion. How much did Pastor Tyler say it would take to bring clean water to the continent of Africa? $11 billion? I'm just saying...
What's the real issue here? Its pride. We buy stuff with credit because we "need" it now. We worked hard, we deserve it. But aren't we called to be good stewards of what God has given us? Look, I'm not saying credit cards are evil and I'm not saying get out of debt to make yourself rich. I am saying that we all need to take a really close look at how we spend our money. If we spend more money than we have, and then extra money on top of that in service on that debt, is that really honoring God with our finances? Maybe it means driving a used car. Or buying less house. Maybe renting instead of buying (more on the "buying a house is always a better financial move than renting" fallacy another day). Perhaps you keep your phone an extra year. Maybe you get a second job. Staying out of debt will require discipline and sacrifice. It will not be easy. But we are not called to easy (Luke 9:22-26). For my part, until further notice, no more credit card purchases.
Soli Deo Gloria
So I should take that flat screen back...?
ReplyDeleteThat's not cool Amy.
ReplyDeleteDave Ramsey is definitely an interesting character. I use to love him, then got annoyed with him, and now I'm kind of ambivalent about him. However, he point out a verse that I think is pretty relevant:
Proverbs 22:7 (NASB) - The rich rules over the poor, and the borrower becomes the lender's slave.
It's insane if you sit down are really look at where your money is going. The hardest thing to do is to admit its a pride thing and break that mentality of "mine, mine, mine". Its a hard lesson to learn, I am learning it now, but even in the last few months of cutting up cards and paying down debt, and saying "no" to the extras (cable, etc...) it makes a huge difference. I fully believe reaping the rewards of being a "good steward" will be worth it, no matter how hard the road.
ReplyDeleteGood post Mikey!