Here’s a good New Year’s resolution: get out of debt and stay out of debt.
This is a tough one for many families and even tougher for government – at all levels.
In America, almost everyone has to borrow to buy a house. The alternative is to rent and you can’t build equity if you live in an apartment or rented house.
When I graduated from college, I lived in apartments for about four years. I shared those apartments with friends from college. I also saved a percentage of my income (which wasn’t a lot) every week for two years.
I accumulated $5,000 in savings and it became a down payment on a modest two-bedroom frame house in Midtown Tulsa. Four years later, I married my lovely wife and we moved into our little love cottage.
We knew we wanted children and we sold that house (for a profit) and bought a three-bedroom home. Fourteen years (and three kids) later, we sold that second home for a modest profit and bought a four-bedroom home that proved to be just right for our family. That was our third mortgage.
Since I was 16 years old, I have purchased 11 automobiles (mostly Fords and Chevys). I had to take out a car loan for the first eight, but thanks to God’s provision we bought the last three with cash.
Trust me, there were many times when I wished I didn’t have a car payment and regretted having to get a note.
Now, again thanks to the grace of God, my family owns six cars – all paid for. All of them have less than 100,000 miles and are in relatively good shape.
The price of cars – especially new cars – is outrageous. And it is way too easy to drive a clunker into a dealership and sign up for a 72-month note for hundreds of dollars a month. The debt may last longer than that car.
A side note, the last car we bought was brand new for cash. I keep getting letters from the dealership saying they can “get me into a new car and ‘lower my monthly payments.’” I doubt that. It’s interesting that when I told the salesman we were not going to finance the car, he kept trying to get me to use their financing.
In Tulsa, you have to have a car. And some people can’t afford to pay cash. But as Dave Ramsey recommends, buy a cheap car with cash and then save for something better.
According to NewWallet, Inc., the average U.S. household has credit card debt of $16,061, with average household debt of $132,529. The average household auto loan balance is $28,535 and the average student loan balance per household is $49,042.
We have personal credit cards and company credit cards because it seems difficult to travel, buy gas or buy anything online without them. We almost always pay off the balances each month.
I have some wonderful Christian friends who don’t have any credit cards. Some don’t even have debit cards and I appreciate their commitment to fiscal responsibility.
All three of our kids went or are going to college and we have no college debt. Our son who went to College of the Ozarks in Branson literally worked his way through college. That Christian school does not charge tuition but each student must work 15 hours a week on campus to defray the costs. They won’t let students take out student loans and more than 95 percent of their graduates leave with absolutely no debt.
In this day and age, that is a mighty blessing.
Anyone who runs a small business knows that it is difficult to avoid debt. Capital is critical for almost any business and some small companies have very narrow profit margins.
We try to have God’s perspective on debt in our personal lives and in our business. I truly believe that if God gives you a specific job to do, He will also provide you with the finances you need to pull it off.
I have a file on my computer with 16 years of specific answers to prayers concerning the Tulsa Beacon and a significant percentage deal with finances. Those answers are all blessings.
Debt is a fast lane to enslavement. I always try to spend less than I make and stay away from indebtedness that could damage me and my family.
I wish the government felt the same way.