Money

Ordering Finances Wisely, Part 7: Becoming Debt-Free

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Why are credit card fees and interest so high?

Credit operates using basically a two-tier system. Tier 1 consists of those who pay no fees or interest. Consumers who pay off their balances on-time monthly pay no fees or interest charges. Tier 2 consists of those who pay fees and interest due paying late, not paying the minimum payment or due to carrying a balance and being charged interest. Tier 2 credit card customers not only pay for their own credit card service, they also pay for the credit services of those in Tier 1.

Any customer may be a Tier 1 borrower. Falling into the Tier 2 category is the customer’s choice.

Another reason for high credit fees and interest is that there is expensive technology infrastructure in place to support the service. The infrastructure includes network expense and computer hardware and software expense. It also includes real-time processing with failover—the most expensive type of computer processing. Additional infrastructure expenses include fraud detection processing and the cost of plastic production and the associated mailing.

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Ordering Finances Wisely, Part 6: Helping Another in Financial Crisis

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Pastors and other leaders are often faced with helping others in personal financial crisis. The crisis may take several forms:

1. job loss whether by layoff or firing
2. a major medical crisis
3. debt at the tipping point
4. divorce or other family crisis
5. death of a spouse or family member
6. societal economic crisis with widespread impact

Job loss, whether by layoff or firing

The income flow stops (as in the case of being fired) or will soon stop (as in the case of a layoff) but the outflow does not. Single income homes are more susceptible to financial impact because the second income of a spouse may cushion the blow.

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Ordering Finances Wisely, Part 5: The Personal Income and Expense Statement

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In various phases of life I have spent money without giving much thought or planning to it. The first was when I was in seminary and I had to have the latest book. A professor would mention a book and I would have to have it. Another was when I bought my first CD player. The first CD I bought was an Herb Alpert’s Tijuana Brass album. I soon thought I had to have a library of CDs. The third time was when I bought our first DVD player. First, it was “Lawrence of Arabia,” then many more followed. Another phase—and this probably sounds like “true confessions”—is when I had to have the latest modem (2400 baud) or software (Word Perfect) or hard drive.

A single CD, or book, or DVD, or device is not much of a problem, but unchecked anything becomes a spending issue. My wife, who handled our finances during these phases, put up with a lot! Many counselors can testify that finances are a major cause of marital strife. A secular study from 2009 attempted to quantify the effect finances had upon marriages:

Of all these common things couples fight about, money disputes were the best harbingers of divorce. For wives, disagreements over finances and sex were good predictors of divorce, but finance disputes were much stronger predictors. For husbands, financial disagreements were the only type of common disagreement that predicted whether they would get a divorce. (New York Times)

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Ordering Finances Wisely, Part 4: Good Debt, Bad Debt

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Some Christians are completely opposed to borrowing.1 Verses such as Romans 13:8, “Owe no one anything except to love one another” and Proverbs 22:7, “the borrower is servant to the lender” are used to support this position.

My own view is that borrowing is permitted in the Scriptures, since the Scriptures provide regulations with regard to lending (cf. Ex. 22:25; Lev. 25:35–37; Deut. 15:7–9; Neh. 5:7; Ps. 15:5; 37:21, 26; Ezek. 22:12; Matt. 5:42, “from him who wants to borrow from you do not turn away”; Luke 6:34). The broader context of Romans 13 speaks of paying “all their due” (Romans 13:7), so the teaching of Scripture is that one should honor debt agreements and pay on time.

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Ordering Finances Wisely, Part 3: Know Your FICO Score

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In a Twilight Zone kind of moment, imagine an all-night grocery store. Few are there: a stocker, a maintenance worker, and a check out cashier. Three shoppers arrive at approximately the same time. Sleepily they shop for the few essential items on their list. Coincidentally, and unbeknownst to each other, they manage to add the same six items—down to the very brand and packaging—to their shopping carts: milk, cereal, hamburger, two loaves of bread, and pancake mix. They move to the checkout.

The cashier is amazed by the oddness of the event: three shoppers, three carts, six items in each cart. And each cart has the very same identical items. He rings up shopper 1 then shopper 2, and then shopper 3:

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The Stewardship of Final Affairs, Part 2

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The Advanced Directive

The Advance directive or health care directive is a document that allows you to document your wishes concerning medical treatments at the end of life.1 Because every one of us will die, this document is important. If you think not consider this:

  • The Terri Schiavo case2 and the debate about her wishes. Her husband said one thing and her parents disputed it. Her own wishes were never documented. Another such case was Karen Ann Quinlan.3
  • In my own family a relative had a health care directive of sorts—it was from his church but he had never had it notarized and filed. When he was stricken there was a mild dispute among his offspring about whether his ventilator should be removed. The doctors themselves would not agree to remove it because his wishes were not officially documented. He lingered longer than was probably necessary.
  • One might think, “that won’t happen to me!” In my own case I broke my neck in a serious accident when I was only 38. I was semi-conscious for a period of time. Decisions about my care had to be made.
  • My own mother wisely had a health care directive. She specified that she did not want any extraordinary means to extend her life. It was clearly documented and so there was absolutely no debate. My siblings and I knew mom’s wishes. This past March she was given approximately a week to live. She told my sister, “I’m going to heaven!” And she died the next day.
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The Stewardship of Final Affairs, Part 1

The Christian is called to a life of stewardship. All of one’s life, all of one’s talents, all of one’s time and all of one’s material things come from and belong to God. It is both prudent and biblical to plan for one’s future.

As one who has received difficult medical news—“I’m sorry to say this, but you have cancer”—I identify with Hezekiah:

In those days Hezekiah was sick and near death. And Isaiah the prophet, the son of Amoz, went to him and said to him, “Thus says the Lord: ‘Set your house in order, for you shall die, and not live.’” Then he turned his face toward the wall, and prayed to the Lord, saying, “Remember now, O Lord, I pray, how I have walked before You in truth and with a loyal heart, and have done what was good in Your sight.” And Hezekiah wept bitterly. (2 Kings 20:1-3)

“Set your house in order”: Final affair planning is just this—setting one’s house in order!

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