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Wednesday, September 17, 2008

What about how we approach debt?


Now seems like an appropriate time to write a post that deals with the issue of debt. Inflation at it's highest in ages, recession seems inevitable, banks and financial institutions that once seemed invincible are crashing to the dust, airlines and travel companies going bust, energy prices continue to rise and the price of food and the impact of the credit crunch is far from over. In a connected world the ripples from each splash grow that little bit wider.

We have built much on the promise to pay later, which is quite a promise to make. It's a risk every time. It's a bet and a gamble on the future, at best it is a calculation that everything will continue just fine or even get better at worst it is a denial of responsibility and an open door to slavery to whims and selfish desires. James 4/14 reminds us that our life is not nearly as solid and reliable as we might think and betting on the future is a dangerous game.

Easy access to debt has had a number of dangers. It has made us impatient and selfish (see this great quote on waiting as the antidote to greed) - we want our desires satisfied now. This in fact lessens our pleasure and shortens the impact because we will soon want some other new thing.
It has devalued work and made it a prison - what we've worked hard for has value for us, what we haven't yet worked for becomes a weight around a neck - gotta to keep working to pay off those debts. Easy debt breeds discontent and encourages us to see solutions in material things.

Of course, debt eventually needs repaying - something that we all too often forget. If we don't pay then it's either a gift or theft. And debt brings pressure, it breaks up marriages, families, ruins lives, creates depression and as was the case in my own county of Shropshire recently, debts can be utterly destructive.

So debt should be approached carefully, it should be planned and used sparingly. I'd encourage accountability and openness with your finances. If you can do it with your private thoughts and spiritual life you can do it with your cash. Opening up to someone who earns more than you and someone who earns less than you is a revealing exercise. Debt should also be repaid as quickly as possible.

Personally, by nature I'm wary of debt - I dislike it when I have it and I'm happier without it. The less of it I have the more money I have to give. Reluctance to take on debt helps me tell the difference between needs and wants. I'm happy with debt being a place of last resort.

If debt is an issue see check out Community Money Advice or Credit Action
Other Bloggers who have mentioned this recently:
  • Jeremy has an thought provoking post on the illusion of our economy
  • Matt Hosier on certainty in uncertain times
  • Rob Mason on the credit crunch
  • Mark Heath on checking that money isn't an idol

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