When he wasn’t flying kites in thunderstorms, Ben Franklin often wrote thoughtful sayings. One of his wisest “He that goes a borrowing, goes a sorrowing.” The Bible has a lot to say about borrowing, too and none of it’s good. On this MoneyWise Live, we explore the Dangers of Debt with Kingdom Advisors Founding Director Ron Blue— who joins our host, financial planner and teacher Rob West. On this MoneyWise Live we’re talking about the Dangers of Debt and Ron wrote about this with great passion in his book, "Master Your Money".
Rob asks these questions of Ron about the dangers of debt:
- What do listeners need to understand about debt?
- Debt is any money owed to anyone for anything
- Debt is not a sin, Bible discourages, does not prohibit
- It’s never the real problem, only a symptom
- What are the different kinds of debt?
- Credit card
- What are the economic dangers of debt?
- Compounding works against you
- Depending on the term and interest rate, often repay several times the loan
- Becomes a trap, getting in is easy, getting out seems impossible
- There are more subtle costs to borrowing that we may not see. What are the spiritual dangers of debt?
- Borrowing presumes upon the future
- Borrowing may deny God an opportunity to work
- What is the criteria for determining "good" and "bad" debt?
- Cost must be less than the benefit
- Guaranteed way of repayment
- Both spouses must in unity
- Must have spiritual peace of mind
- Must help achieve God-given goals
Next, Rob and Steve answer these questions at 800-525-7000 or via email at Questions@MoneyWiseLive.org:
- If things are tight because of job loss, would you be robbing God, so to speak, if you used some of the funds you normally direct to giving and direct it to savings and debt?
- If you have two HELOCs that are rising in interest rates a good bit lately, should you refinance?
- If you're age 52 and have a variable rate mortgage and wish to pay it off in 7 years, should you use fund that you normally direct to retirement savings?
- If you cosigned for your daughter's student loans in the amount of about $100,000 and have medically related credit card debt of $35,000, should you consider selling your house or is there some other way to satisfy these debts?
- If you're about to be age 59 1/2, have your home paid and only about $1,200 in savings, should you withdrawn funds from a 401(k) to fix a roof that is in imminent need of repair?
- What are some good options for your young son for cashing a check until he gets a checking account of his own?
- If you run a non-profit and wish to donate some of your proceeds to another like minded charity, would that be acceptable for those who have donated to your organization?
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