Bring It On: Money
God and Money
Financial Advice
Family Money
Credit and Debt
 My
husband and I manage to put a combined $10,000 away each year in our 401(k)s.
I heard you speak once about a special curve in savings and something
to do with a formula and 72. Would you please explain that again for us?
We're about 20 years from retirement. At our current level of savings,
will we have enough?
 At your current level of savings, if you get that thing working for
you, you're going to have a whole lot. I congratulate you that you're
taking as much as $10,000 and putting it away.
It's going to grow tremendously. This is what's called the Law of Use.
Jesus talked about if you use what you've got, you'll have more. What
is this? What you do is add a percentage, and the technical word is "compound."
If you compound your holdings, those savings or whatever, at a particular
rate, you can tell how fast it will grow.
At compound, it will double according to the Rule of 72. It's really
simple. You say, 'What interest rate am I getting on my savings?' Well,
let's assume that you're getting 10 percent and that you can manage your
portfolio. That means it will double in 7.2 years. Then, if you keep it
up, it will double again and again and again.
It was said if you had the 30 pieces of silver that was given to Judas
Iscariot, and he had compounded that at 4 from all the time since he lived
till now, there'd be enough to give every man, woman, and child on the
face of the earth $300,000. I mean, it gets to be enormous.
Now, this is what's called the exponential curve. It's a curve that kind
of goes up and then it gets to a break point, and then it goes straight
up. After about ten years, you have a pretty good return. But by 20 years,
you got a takeoff point, and you take it down to 50 years, and it staggers
your mind. The idea is that every year you need to increase it. Now you're
putting in $10,000 every year. You're investing it, hopefully, in the
market. If you get good stocks that pay dividends, seven percent, that
will double every 10 years. But you've got 20 years. If you can get it
at 10, it means it will double, double, and double in the 20 years that
you've got left. Whatever you've got in there now, say you have $200,000,
in seven years it will double to $400,000. Then seven more years it will
double to $800,000. And if you will leave it in seven more years, it will
become $1.6 million. That's the way it works. It's simply astounding,
the exponential curve.
So get this thing working for you, and don't take your money out at any
point of time. Let it grow, let it work, and let the law of God work.
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Pat,
my husband and I are in our 20s. We've accumulated $15,000 in credit card
debt. It didn't seem so bad because the monthly minimums were low. Now,
as the amounts are growing, it's getting harder to manage. We've checked
into debt negotiation, but the counselors tell us as long as we can meet
the minimums on paper, they can't help us. We need a strategy to get out
of our debt. Would you have a suggestion?
I want to tell you some numbers. They're frightening, but this is
the deal. You have $15,000 in credit card debt. You make the minimum payment.
Assuming your credit card is running at 19.99 percent APR-it may be a
little less than that, but all right-for 53 years, you're going to have
to pay those minimums. You will pay interest, which is $46,400. So you
will triple the amount that's your debt in interest. With the principal
in interest, together, you'll pay $61,000. It will take you 53 years to
write that off at the minimum. Don't even think about minimums.
What do you do? It's very simple: You've got to have a budget, and you've
got to have more money coming in than going out. That means that some
of the things you think are necessary you've got to get rid of. Maybe
you bought a new car. Get rid of it. Do something cheaper. Maybe you think
you've got to have a big house and you can't afford it. Sell it and get
something less. Cut back on those things like going to Starbucks for a
$3.50 cup of coffee and all this that you think is so important.
Count down everything that you're spending, and at the end of every month,
pay down those credit cards. If you've got several of them, pick out one,
the one that's got the biggest interest, and pay it down fast. Do the
minimum on the other; pay that one down; get it out of the way. Then start
knocking them down.
You can take care of $15,000 in a couple of years if you try hard. I'm
sure the two of you are working. You've got money, and you just have to
sort of tighten your belt and have a budget. Don't spend more than you
take in. And while you're doing it, give unto the Lord's work. You've
got to do that.
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Pat,
I have young children and would like to help them learn how to be good
investors. I'm hoping they won't make the same mistakes that I did with
credit and get into debt. How would you suggest teaching kids to handle
money and develop an investment plan?
If I were you, I would set aside a certain amount of money for the
children, and what I would do with them is to say, 'You're going to be
earning money mowing lawns, sweeping the house, doing whatever you do
with your allowance. You're going to take 50 percent of that, and you're
going to put it in a box, and you are going to invest it.' Your children,
if they could just put down $5 each month for 55 years, and they can compound
it every month, if they compound it 12 percent, they'll have $362,000.
And that's just $5 a month.
If you work it so that they're putting in half, and then the summer they
get more so they put in some, and then maybe if you could add another
$500 or $1,000 to it, put it into one of those accounts. I guess the Roth
IRA would be the best way of doing it. You don't get a deduction for putting
the money in, but it builds up tax-free inside of that Roth.
I think I would start them as early as you could. I'd start them at year
one. And any gift to them, let them spend half and use half for saving.
You will be amazed how much money it is.
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Pat,
is it ever a good idea to buy on credit? My wife says an emphatic 'no.'
I'm not so sure. Isn't it important to develop a credit history in case
of an emergency?
It doesn't make any difference, your so-called 'credit history'. If
your broke, you're broke, and they're going to look at how much income
you've got, how much is going out, what your obligations are, how big
a mortgage. They don't care a hoot about your so-called credit history.
That is fictional. The big thing is, have money. If you have money, and
you are not in debt, you're better off. I don't object to using a credit
card on a 28-day deal where you pay it off so it's a convenience, so you
essentially have a loan courtesy of one of those credit card companies
for 28 days. But you pay it off, and so it's just a convenience. But other
than that, building up stuff on credit is a bad mistake, at least consumables.
We're not talking about mortgages or investment in business. We're talking
about consumables. Not a good idea at all to live at the bank. Don't do
it.
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My
husband and I never seem to agree when it comes to money. He feels it’s
none of my business how or where he spends his money and I want our two
adult children to pay rent. He says I’m just greedy. What should I do?
I wish husbands and wives would get together on certain things. If
you look at the biblical model, it says the husband is the head of the
household. I think, in this case, he’s earning the money. So the wife
should say, "All right, I’m not going to interfere with you as to
how you take care of the money because that’s your responsibility. I’m
going to leave it in your hands."
But, at the same time, I think a husband who’s got any sense will discuss
financial matters with his wife, and wives will discuss financial matters
with their husbands. Many wives just go blissfully along and husbands
make the money and make all the decisions. Then if the husband happens
to pass on, the wife is left without a clue as to what to do and she is
the prey of these vultures that come along.
I think half of those divorces, half of the problems in marriages have
to do with money. And so finances are very, very important. You should
work out a modus operandi. I think the husband should certainly listen
to his wife’s advice if you’ve got two grown children. Yes, they ought
to pay part of the bill, but again, it’s the husband in this case who’s
earning the money.
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Is
it a sin to pray for money? If I really need it desperately, is it okay
to pray that God will prosper me, and not feel bad about it?
You'd better believe it! It's more than okay to pray for money; it
is often vital that we pray for our financial needs to be met, that our
loved ones prosper, and that God's work in the world will be financed
sufficiently. The real question is, what are you going to do with what
God provides?
In some cultures, basic items can be obtained through bartering or trading
services. While that isn't out of the question for us, most people in
Western culture use money to pay for basic needs such as food, clothing,
shelter, and transportation. Is God interested in providing these things?
Yes, He is! Does He always do so by providing more money? Not necessarily.
Sometimes He chooses to change us rather than to simply change our financial
circumstances. In other situations, God provides the money and we become
stewards, managers, of His resources. We will, of course, give an account
one day regarding what we have done with what God has given to us.
Certainly, God isn't some big slot machine in the sky, where you pull
a lever or punch in the right data and out comes a jackpot. Nor is He
a Santa Claus who provides all the toys on His children's wish lists.
But God does give to His children. Jesus said, "Whatsoever ye shall
ask the Father in my name, he will give it to you. Hitherto, have ye asked
nothing in my name: ask, and ye shall receive, that your joy may be fu1l."
Isn't that amazing? God wants us to ask! And God wants to give to us!
Some years ago, my income was so low that I was living very close to
the financial edge. Nevertheless, I believed..that I should give a significant
amount to the Lord's work, so I did. Several weeks later as I was driving
my car, God spoke to me, and said, 'ask Me for something."
I said, "Lord, I think I have everything I need right now."
He said again, ask Me for something."
"Okay, Lord. Please provide me with one thousand dollars."
I wasn't sure why I mentioned that figure, but it popped into my mind,
so I spoke it in my prayer.
Within days, I had received an extra thousand dollars out of the blue.
Shortly after that, Dede and I discovered that our daughter needed some
orthodontic work done immediately. The cost? One thousand dollars! God
had provided for the need even before we knew that we needed it. He asked
me to ask for it, and He was ready and willing to supply the amount needed.
Your heavenly Father wants you to know that He is there, that He cares,
that He is Jehovah Jireh, the Lord, your provider. Ask and you shall receive.
One caution: James reminds us, "Ye have not, because ye ask not.
Ye ask, and receive not, because ye ask amiss, that ye may consume it
upon your lusts." To ask for God's blessings only to satisfy our
selfish lusts is to invite condemnation. But to ask your heavenly Father
to provide for you, and through you for others, is to be blessed indeed.
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Through
an unfortunate divorce, an unsavory business partner, and poor budgeting,
I am $300,000 in debt. The payments are outstanding. By selling my house
and paying off some loans, I may be able to financially handle some of
the debt, but regrettably, not the entire amount. Is it a sin to file
the rest of the unpaid debt through bankruptcy?
First of all, you've got your life ahead of you and you've got to
get yourself together. Obviously, people have bad businesses. The question
is what is your earning capacity coming out of this? If you tell your
creditors that you are going to declare bankruptcy, they'll work with
you. Creditors like to get paid. If you set up a payment schedule that
you can live with and that is within the limits of your earning capacity,
you can work through these problems. Furthermore, you can do it without
giving up your home and everything else. There's no need in beggaring
yourself on these matters. A lot of businesses have loans outstanding.
They write them off and deduct them. It's part of doing business. The
best way to handle it is to talk to your creditors. Work out an intelligent
schedule that you can live with. When you make those commitments, live
with it. However, all of this depends on your earning capacity. In the
Old Testament, they had the Year of Jubilee where debts were canceled.
The thing you don't want to use is bankruptcy as a means of defrauding
creditors. Many people do that now. They give their assets to their wife
and then they declare bankruptcy. There's nothing sinful about bankruptcy.
It's a question of what it'll do to your record later on. If you try to
get a loan and try to get back into business, it makes it more difficult.
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This
year it took me over two weeks to do my taxes. It took me forever, and
I still owe money to the government. Has filing for taxes always been
this difficult, and is there anything you would suggest our government
do to make paying taxes more equitable and less painful.
There’s
an outcry in the country. There’s something, I don’t want to overstate
it, but I think there’s 17,000 pages in the tax code. And there was one
congressman who happened to be a CPA and a lawyer, and he said he
couldn’t do his own taxes. Now, when it gets that bad, something’s
wrong. I used to do mine. I can’t do my taxes anymore. And I just
scrawled these little things out and send them in, and they got what
they got. But now you have a CPA firm, an accounting firm, that has all
those forms and they’ve got a computer program, and they punch a button
and out comes all these forms. But it’s time we stop this. The cost is
in the hundreds of billions of dollars. There are several proposals on
the table. One would be a flat tax, where you’d take the taxes down to,
say, 17, 18, 19 percent flat tax, do away with most deductions an
exempt people with and income less than, say, 10- or 12,000 dollars.
They just don’t pay tax at all. The other is a consumption tax, which
is being pushed, a so-called VAT. I’m not in favor of that, but there’s
been some persuasive cases made for it. But again, that would be flat
type of thing where you wouldn’t worry about all these problems. But
this thing has just become a nightmare of special interests. Just think
of that. There’s about two or three times more pages than there is the
Holy Bible in the tax code, and nobody can understand it, really. It’s
that bad. So, yes, something can be done. But let your congressman
know. Now’s the time, because the President’s onboard for tax
simplification.
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I
have been married for 32 years, and my husband takes care of me and
does all the finances. But I’m scared, because if anything happened to
him, I wouldn’t have the slightest idea what to do. My name appears on
all of our checking and savings accounts, and if he dies, do I
automatically get access to everything or will it go to probate court?
If
you have accounts joint, tenet the right of survivorship, you generally
would just take it over. But I tell you, you need to get into this
yourself. Women just shouldn’t live in this blissful ignorance and
everything is going to work, because it doesn’t. And husbands do die
and things happen. And one of the worst things is, you wake up finding
that your husband has been cheating on his taxes and you’ve signed the
tax form innocently, “Well, I trust old John.” Well, old John has
defrauded the government, and that becomes your bill and you can do
hard time for signing those things. So check what’s there and get some
advice, and get a few books on accounting or a few books on taxes.
There’s some simple things out there. But, please, with knowledge comes
power, and you need knowledge.
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I’ve
heard of many people having to return to work after retirement, because
they can’t afford to pay their health insurance premiums. Does that
mean premiums go up after you hit a certain age? What’s the best way to
prepare for the cost of health care after retirement?
There
are various plans. Many companies have a program where you can pick up
a rider when you leave and carry it through, and they shouldn’t really
raise the premiums on you. But, for example, at CBN, we have policies
that cover our employees. But the truth is that we’re really
self-insured. I mean, the insurance company is just merely processing
the paper. And at the end of the year, they say, “Oh, well, you had 15
pregnancies and five car accidents; therefore, we’re going to raise the
rates for everybody, because you’re going to have to pay for it.” So
that means they jack the price up, and the employer has to do that. So
it depends on the experience of the insurance company in relation to
the entity. But I wouldn’t think that your premiums would go up, up, up
and up. I’m sure that you could negotiate somewhere along the way some
kind of a health program. My wife has learned of a medical practice
that has a flat fee. I mean, you pay, like, $65 a month or something,
and you get full services. Now that doesn’t necessarily take care of
hospital stays, but it can be negotiated. Lots and lots of things can
be negotiated, so shop around. Do the best you can. And if you happen
to be working, try to work out something before you leave work, that
you can continue with your health plan from your employer and see if
they can’t hold the rates on it.
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I’ve
been looking for a job now for several months. I’ve been getting
unemployment and, I’m learning how to live on those checks and spending
less time trying to find a job. Is it wrong to collect unemployment
payments from the government?
Those
unemployment payments are set up to help transition people just like
you who are out of work to get to another place so that you’re not
destitute. But whatever you do, unemployment is only for a limited
period of time. You can’t stay on it for life. It isn’t a lifetime
pension. And you don’t want to get in the habit of not working. Do
everything you can to get yourself employed. And if you can’t get
employed with somebody else, start a business on your own. Start some
kind of a job that you can do something for pay. Because, otherwise,
you’ll go down the drains. You’ll become like a vegetable. You don’t
want to live that way.
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I
was talking to a friend about bankruptcy, and I told her it wasn’t the
Christian thing to do. However, she said that in the Bible there was
something called the ‘Year of Jubilee’ where everyone is supposed to
forgive all debts. What is the ‘Year of Jubilee?’ Does that mean
bankruptcy is blessed by God?
Every
50 years there was a release of debts. “Proclaim liberty throughout the
land.” It’s on the Liberty Bell in Philadelphia. That was the whole
year of releasing debts. Because if interest continues to build up and
debt continues to build up, before long, some few people will have it
all and the others will have nothing. And so it was kind of like you go
back like a Monopoly game; you go back to square one and start all over
again. And I think that was an appropriate thing to do. And so
bankruptcy indeed has a biblical base, that people are freed from debt,
the crushing burden of debt, so they can get a fresh start. This was
biblical. And it wasn’t just every 50 years. There was a jubilee, as I
recall, in the seventh year, and then it was seven times seven. But
it’s a forgiveness of debt. There’s nothing wrong with it.
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Should
today’s teens be able to count on some type of Social Security when
they retire? And what can we do if the President’s proposals do not get
passed?
I
had pointed the other day to the pyramid. If you look at it the way
Social Security used to be, there was a great big base out here. And
I’ve heard all kinds of numbers. 50 workers, 30 workers, 70 workers.
You take your pick. But for every retiree, there was this big base of
employment, and they were supporting people. And what happened was, if
somebody retired in those days, death came much earlier, so people died
at 60, 61, 62. So if somebody retired at 65, that pool was even
smaller. Now what’s going to happen is that in another 20 years or so,
that pyramid is going to reverse. And so, essentially, you’re going to
have about two workers for every retiree. And in order to support these
retirees, the taxes on those workers is going to have to be increased,
them and their employers, to something in the neighborhood of 23
percent. We have a pay-as-you-go system right now. The pay-as-you-go
system is going to go into deficit in the year 2018. So that’s just a
few years down the road from now. And beyond that, today’s youngsters
are going to be at the mercy of the government. The President’s
proposing, and I have proposed myself, since 1988 or so, private
accounts where people build up their own accounts. It’s their own
money, and it’s invested in the great, tremendous economic growth of
the United States of America in bonds, in stocks in the private sector.
The money belongs to you. It’s not dependent on the whims of some
congressman. So I think the President’s plan really needs to go
through, and he needs to hang tough. If they water it down, it’ll ruin
the program.
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As
a Christian businessman, what advice would you give us young aspiring
men and women who are just entering the job market? How should we
present ourselves and what are employers looking for?
More
than anything else, they’re looking for integrity. They want somebody
that’s honest, so tell them the truth. Competence is very important,
but there are a number of things which you should present. But, number
one, integrity comes at the head of the list. And beyond that is
innovation. I just think that we need the sparkle of innovation. And
beyond that is competence. You’ve got to know what you’re doing. That’s
why we’re training people at Regent
to have skills in various trades. You need to be competent. And you put
together competence, integrity, and innovation, you’ve got a
combination that will take you far.
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I’m
just curious if you have any practical advice about starting a savings
retirement program. If I keep my money in the bank, is it insured
against loss? Or what are you thoughts about that?
I
wouldn’t worry about insurance, because you’re going to wind up losing
more with inflation. How do you start a savings program? I think the
best way is to open an IRA. You can do it with at least a couple of
thousand dollars a year. It’s tax sheltered, until such time as you
begin withdrawing. You’re not supposed to withdraw without penalty,
until you get to be 59. But you can, nevertheless, build that up to
enormous amounts, and you can have a self-directed IRA, where you can
have mutual funds, bond funds, individual stocks. You can do anything
you want to. You can get an account. I like Fidelity, because it has so
many of them, but there are many others, as well. But that’s how I’d
start, and I’d take advantage of that compounding tax free as quick as
you can.
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Throughout
my life, I watched my parents try to reach a point of being
self-sufficient financially. They failed every time. I see myself
following in the same path with failed businesses and meager job
offers. Is this a spiritual curse that has been passed on to me? Will I
have to live with failure like my parents did? Are some people just
meant to be poor?
No,
some people aren’t. But there is a spirit of poverty that settles upon
people. There are some people that just bring trouble on themselves.
The Bible says, “A man shall eat good by the fruit of his lips,” but
also you project things out of your mind. Whether you like it or not,
your brain gives off signals. It tells people around you something.
It’s a question about what are you projecting? And if you’re projecting
failure every time you get around people, then they assume you’re
failure and that you just bring failure into yourself. That’s why you
need to be positive in what you think and [make] positive confessions.
“And a man shall eat good by the fruit of his lips.” You say, “In the
name of Jesus, I am more than conqueror through Him that loved me.”
Read the Bible. Get one of those little boxes with all those promises
and start reciting those promises over and over again. Feed your mind
on the promises of God, and you might read a book called Rich Dad, Poor Dad by [Robert T.] Kiyosaki.
It was a fantastic book that tells about one dad who made a lot of
money and one dad who was a hardworking, very highly educated professor
who was always broke. It’s the attitude toward money. There’s some
people that money just comes to them, but it’s their mind. They think
success, and they are success. If you think failure, it’s been
ingrained into you. So you need to get set from that thing. That is a
curse. That’s not your destiny. You can get free from it.
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I’ve
come to understand that the United States economy is relatively
fragile. It seems that one news report can cause great fluctuation in
our financial system. Would backing our economy with a gold standard
give it more stability?
There’s
not enough gold to go around. Gold is like a straightjacket, and we’ve
long since gone to much more flexible standards of currency. There just
isn’t any way that you can trade physical gold. And, as it is now,
there are at least a trillion dollars worth of transactions that take
place every single day, maybe more than that in the currency market.
But every single day like that, money goes just like this. And if
you’re waiting for something to give you gold coins to settle up, it
just doesn’t work. Gold is like an archaic relic. And so I think you’re
just going to have to rely on what’s there. And if I were you, I’d load
up on the tangible assets and not just paper.
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My
husband’s father died in December, and my husband is the executor. He
left us $50,000 and one-third of his estate. The rest is to be split
between the other two children. His siblings don’t think it’s fair, and
my husband is considering going against the will to split everything
evenly. Was it wrong for their father to favor one child over another?
Would my husband be making a mistake if he went against the will?
I’m
not sure he’s got the privilege of going against the will. What’s given
is given, and I don’t know as executor he has the legal privilege of
disregarding the father’s wishes. There’s nothing wrong with this. They
used to have what they call “primogeniture,” where the firstborn son,
essentially, got the estate, the title, and got most of everything. I
don’t see anything wrong with a father deciding he wants the major
portion of his estate to go to somebody. He might know something about
these siblings that your husband doesn’t know, and he may think one
will waste the money or one would make a better use of it. I really
don’t believe that he has the legal right as executor to go against
what the will says. The will is his document of authority. He has
placed as executor, and his job as executor is to carry it out --
period.
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When
I got married, I thought my husband would be able to take care of me
financially. I recently found out he’s deep in debt and he even
declared bankruptcy before we were married. His reaction is, ‘It’s just
money.’ Will my husband’s credit history affect my credit, and is there
a way to protect my credit report.
I
wouldn’t worry so much about your credit report as I would about your
marriage. I would counsel people who are watching this program, by all
means, inquire about your future spouse’s spending habits and where
they are financially. I hate to say, that’s a type of fraud. He
committed a fraud on you by not letting you know in advance that he had
a bankruptcy, and I think your relationship, in that sense, is
fraudulent. But be careful. One thing you don’t want to do is sign a
joint tax return with somebody like that, because if he decides he
wants to go south on you, you’re going to wind up owing the IRS for his
bills, and that’s the problem. I don’t know about it affecting your,
quote, “credit record.” That’s not a big deal. The big deal is that
you’ve got to get your marriage straightened out. He needs, again,
financial counseling so he will start shaping up his life. But this is
a sense of irresponsibility.
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I
am in business, and I’m planning to go public with a company I
privately own with my wife, who’s also a Christian. Will the entrance
of new shareholders who will be mostly unbelievers amount to unequal
yoking in business with unbelievers? Can I safely join my vision with
those of possible non-Christians?
In
the old days, going public was the road to riches. You’d go out in the
public market, and now you’d have stock. The stock would go up, and the
founder would have a lot of money. It would just give you a lot of
opportunity. Now, I want to tell you, getting involved in a public
company is a nightmare. Sarbanes-Oxley is horrible. The CEO of a public
company got to swear under penalty of criminal indictment that
everything and all of your financials are accurate. I mean, it’s a
tough, tough thing. Plus, many of the big brokerage firms don’t even
give coverage to somebody that has less than $200 million a year in
revenue. So if you’re a small company, you’re going to languish and it
will really be tough. And I tell you, I would say today, if you can
possibly avoid going public, don’t do it. And it’s not so much about
bringing in unequally yoked. If you have control, if you have enough
super-majority stock so you control the board, then it doesn’t really
matter what these other guys do. But if you have a minority position
and you have other people who have majority control, then, yes, they
will take your business away from you as well. So in today’s world,
it’s kind of like don’t do it. Ten or 15 years ago, it was the road to
riches. Today, it’s the road to a nightmare.
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What
do you think of having an interest-only loan as a second mortgage? I’d
have ten years to pay off the principle. This way, I can pay off all of
my other debt and then start paying the principle. Is this a good idea?
It
does in some measure depend on what your financial status is, and I
don’t’ know all the circumstances. I mean, if you’re loaded up with
credit card debt and you’re paying 28 or 30 percent on overdue loans,
it might not hurt to put something like that on a mortgage, because at
least you get to deduct the interest. But I tell you, ladies and
gentlemen, these interest-only loans, or these ARMs, these
adjustable-rate mortgages, they’re going to come back to bite people.
And more and more of the mortgages that are being issued now are
adjustable rate. And once interest rates start popping up, and they
will, as long as we keep throwing money out the window in our
government and into foreign countries in our spending—the value of the
dollar is going down, and the debts are going to rise in interest
rates. So what are you going to do if all of a sudden interest rates
pop from three-and-a-half percent on a ARM up to six or seven percent?
What’s going to happen? I mean, there are going to be just a raft of
foreclosures. So I would be very, very careful with these, quote,
“interest rate only.” I mean, it sounds so nice. But you’re not paying
anything down, and it gets to be a debt trap. The Bible says, “Owe no
man anything except to love one another.” Get out debt as fast as you
can. The borrower is the servant of the lender, however you get it. You
can use debt in business and so forth, but just be careful of it. But I
think interest-rate only, it’s a seductive type of financing.
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I’m
a 78-year-old widow, and I’m concerned about my children. What
obligations, if any, will my kids have in regard to indebtedness I
might leave at my death? For example, what happens to my mortgage
payments, credit card balances and car payments?
Well,
your children won’t owe anything, but your estate will, because these
are debts that you have, and they go into your estate. So when the
balance is figured out of how many assets you’ve got and how many
liabilities, the net remaining will go to your children. But at the
same time, from your estate. Unless they signed on your mortgage,
they’re not obligated for your mortgage or for any credit cards you’ve
got. But whatever money you leave, and if on the other hand you don’t
leave any assets, then it’s tough luck for the creditors. It’s just the
way it goes. But I’m sure as a Christian you want to make sure all your
assets are in order. I think it’s appropriate to have our assets in
order, just as a testimony to our faith in the Lord. So if you have
debts and obligations, it doesn’t hurt to take care of them.
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