A question came to me that asked whether or not taking out a student loan is bad and a sign of not trusting God. To be honest, I really don’t think it is that cut and dry. To say that God never wants us to have a loan is pretty tough.
I was part of a church that wanted to build an addition debt free. Later we changed direction and took out a loan. I don’t believe that it was the wrong direction or a lack of trusting God. The land was worth eight times the cost of the addition and was already paid for. God allowed that equity to be there to expand His kingdom. We need to use the resources He provides, and I believe sometimes that means taking out a loan.
But I also believe there are good debts and bad debts. Credit cards, for the most part, are bad debts, and we should eliminate them as quickly as possible. They turn some people into slaves, working to pay off a debt that for many becomes impossible to pay. Plus, most credit card purchases are for things that people can do without.
When I first left college and started in ministry in Chicago, I got in a pinch and used my credit cards to eat a few times and pay for car repairs. They were “real” needs and not “felt” needs, like my need for a new PlayStation 2 or a new guitar. The problem was, I wasn’t making very much money and couldn’t pay on my cards, and it spiraled into a pretty large debt for me to handle. It pretty much screwed up my life for a while and was a constant worry.
I have not had a credit card since I was 22. I still have difficult times that I face, but I always make it through. I have needed to fix my car at times. By not having a credit card, I was forced to find other solutions. Where many times I would have just charged it, now I have waited. And yes, many times God came through and blessed me in amazing ways. And most of the times the help came through other people. I really believe that credit card debt is bad debt and should be avoided at all cost.
Now, I know that there are people who are in credit card debt already, especially after this winter season and now Valentine’s Day. These people need to work on a plan to get out as fast as possible. Ignoring the situation never helps. Trust me. I tried that. Four years ago I started a plan to get out of debt, and by the end of next year, with the exception of my car, I will be debt free. It is such a relief! There are many credit-counseling places that help work out these plans. Many times they can lower your interest rates, which means you will be out of debt sooner.
The Bible says, “Pay all your debts, except the debt of love for others” (Romans 13:8a). This means there are times when we will be in debt, but the biblical principal is to pay them. So we need to be wise about the debt we get ourselves into.
So what is considered good debt? Most people believe that anything that has the potential to appreciate is good debt. Things like the purchase of a house or a student loan are good debt. The return on these things will be good in the long run. I would also say that sometimes the purchase of a new or newer used car is good debt. I know some people disagree on this, but if the purchase is looked at in the big picture of what it allows you to do and not just a cool ride, it can be considered a good debt.
Good debt cannot be categorized either though. I know for me, when I prayed about my future at college, going into more debt did not make sense. I was studying to work in ministry in the inner city. Realistically I wasn’t going to make a lot of money. If I would have stayed in school, I would have had at least $17,000 of debt. So I decided to leave and work in the city of Chicago. This was a smart move for me, and I only made the tough decision through a lot of prayer.
The bottom line is that, as a follower of Christ, we need to pray about any debt that we get ourselves into. We are called to be good stewards of everything we have. In the scope of God’s call for our lives, we need to discern whether getting into a debt is going to allow us to be good stewards of what God is giving us. Sometimes the answer to this is yes, and sometimes it is no. But the answer to that question is only going to be found through prayer. When you go to God in prayer, it shows that your trust is not in a loan but in God.