Thursday, January 22, 2015

The Borrower is Servant to the Lender

Proverbs 22:7

“The rich rule over the poor, and the borrower is servant to the lender.” 

One of the many contributors to the Great Depression in the United States, during the 1930s, was the over-extension of credit.  Banks, as well as Savings and Loan companies, were giving out high-risk loans to people. When the stock market crashed on Black Tuesday in 1929, the practice came back to bite them. When their creditors came to collect, it brought many-a-family to rack and ruin.

All this sound familiar? Consumerism has been around since trade and barter. It’s who we are as a species – we consume what we need and what we want. The tricky part is drawing a hardline between needs and wants. Most people never take the time to figure it out, until we wake up one day to realize we are sending out more than we are taking in, and a vicious cycle has embedded itself into the finances. We are facing our own mini “Great Depression.”

This situation can easily spiral out of control IF we let it. The number one way to snowball your situation – financial or otherwise – is to avoid it. The number one reason (i.e. excuse) for not facing Mount Debt is not the fact that one has no money, it’s vanity, otherwise known as pride.
The first step in taking on such a problem as Mount Debt is to humble ourselves and admit that we created Mount Debt all on our own. There’s no sense in pointing fingers at anyone. Everyone has the ability to say yes or no to any expense. If the hardline between need and want is in place, it makes the decisions a lot easier.

Late last fall, I realized that my debt to income ratio was way too high. I couldn’t let it slide anymore. While formulating a plan of action, my grandfather’s voice started chitter-chattering in the back of my mind. “You cannot rob Peter to Paul. Never a borrower or lender be. If you have money problems, you pull yourself up by your own bootstraps and take care of it - before it gets out of control.”

Grandpa Scheer, God rest his soul, was right all those years ago, and he’s right now. What is the point of borrowing more money to pay back the money you borrowed in the first place; right? So, I did exactly what my grandfather would have done. I found a part-time second job that would work with my existing schedule and now find myself with more and more financial breathing room with each passing month. I don’t have to pay any of the money back. I’ve already paid for it with my labor. My creditors are happy. I’m happier. And, in about 10 months or so, I will be 100% debt free, including my student loans and my car.

I have indeed become a servant to my debt.