Sunday, June 28, 2020

MoneyWalk 55 Don’t Borrow Unnecessarily



This program will help you undo financial bondage.

This process starts by saying no to any loan for items that depreciate in value when you cannot pay cash for them without taking on debt. Also, when taking a loan will not immediately benefit you by allowing your investments of the same amount grow at a higher rate than the finance charge you would pay the creditor.

Most people find it impossible to meet these requirements because they have underfunded emergency savings, very small investment holdings, and most institutions have finance charges higher than the growth customers earn on savings and investments. Also, creditors retain the right to raise finance charges down the road when they believe you represent greater risk of payment delinquency. Such delinquency causes fees and penalties to be assessed and will damage your credit history and score.

It seems far less than one percent of business owners have financed business ventures using high finance charge loans and then collected enough revenue to overcome their expenses (cost of products, services, wages, benefits, finance charges, etc.). Don’t be fooled into thinking this is a prudent strategy for financing a business. Most who have tried this method have had to liquidate their businesses.

Biblical instruction strongly guides you to pursue your financial life, personal and business, from a debt-free mindset; asking God and seeking a number of godly counselors who can help you find prudent ways to start and invest in business endeavors and purchase personal merchandise that is desirable to you. The vast majority of people I’ve met who did not follow this method have found themselves in financial turmoil not long thereafter. It continues for many today because they still refuse to utilize biblical money management instruction to guide their financial affairs.

If you have a history of undisciplined use of loans (credit cards, car loans, etc.) then you should immediately discipline yourself to stop using them and build an emergency fund of at least $10,000. You need to cut up credit cards and throw them away when they will continue to bring torment into your life.

If you are a disciplined spender who stays well within established budget boundaries, a low interest revolving credit card will generally not hurt you because you will only use it for convenience and record-keeping purposes where you will only make purchases already accounted for in your budget and you never charge more on these cards than the amount of cash you have available in the bank minus your monthly bills, saving, investing, tithing, and giving.

Though scripture does not absolutely say you cannot take on any debt, it strongly advises you to live debt-free and that God desires debt-freedom for you.  The compounding interest nature of most debt will wreck your ability to build wealth for the future. The enemy knows this and tempts you to satisfy the cravings of your flesh using debt instruments. However, when you commit to God’s plan of living debt-free He will provide your every need without you having to borrow to supply it. When you refuse to take on debt, you enable the LORD to supernaturally provide by moving others to provide needs and desires at no cost when you're unable to purchase them.

Please pray for this ministry, email me with any questions, and contact me to speak at your business or ministry conference or workshop. May the LORD bless you richly as you follow His plan!

Deuteronomy 28:12, Psalms 37:21, Proverbs 22:7, 27:23-24, Romans 13:8

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