Many families' financial problems develop through ignorance of God's principles concerning finances.

Without question, family financial problems seem to increase dramatically during an economic slump. Why do families experience more problems during economic downturns? The truth is they don't. They suffer more symptoms, like unpaid bills. The consequence may be that lights are turned off or cars are repossessed. But, with rare exception, the problems (root cause) that precipitated this began years earlier, perhaps even in childhood.

Many of the symptoms we see so abundantly today--business failures, massive bankruptcies, divorce, or two-job families--stem back to the same basic problem of ignoring God's Word and His warnings. "Now it shall be, if you will diligently obey the Lord your God, being careful to do all His commandments which I command you today, the Lord your God will set you high above all the nations of the earth" (Deuteronomy 28:1). God's instructions are neither complicated nor harsh. In fact, they are designed to free us, not bind us, to a set of rigid dos and don'ts. The difficulty is that most American families (Christians included) have been duped into a life of get-rich-quick that includes the way they buy homes, cars, clothes, and food. God's principles in the area of finances have been largely ignored for the last 40 years, and now we are reaping what has been sown.

I read an article in a business magazine that vividly brought this into focus. It seems that the largest mail order seed company in the country decided to go out of business, despite the fact that sales were higher than ever; unfortunately, so were nonpayments by their mail order sales force. For nearly 50 years the company had been supplying seeds to children who would sell them door to door, mostly in rural communities, to raise money. In recent years, the nonpayment rate to the company had risen steadily until, in 1981, it reached 70 percent. The average age of this delinquent salesforce was 10 years old! The final straw came when the company attempted to contact the parents, hoping they would help in collection, only to discover that the parents actually encouraged the kids. The symptom described is nonpayment of a just debt, but the problem runs much deeper. It involves basic values that parents fail to instill in their children. It's an attitude that my rights come before others. The lack of integrity in the parents is reflected and is amplified in the lives of their children. It's unfortunate that later these parents probably won't understand why irresponsible children become irresponsible adults. "A righteous man who walks in his integrity--how blessed are his sons after him" (Proverbs 20:7).

EARLY SYMPTOMS

The symptoms seen today in family counseling are distressingly predictable. It seems obvious that the same basic errors in early family training are being made throughout our society. Before looking at the problems and solutions, it's necessary to identify the symptoms. Most young couples today come from middle-class families with nice homes, two cars each, color television sets, and a variety of credit sources used to purchase them. Their parents don't operate on a budget and, consequently, the children aren't trained to do so either. The parents use credit readily and usually make buying decisions based on monthly payments, rather than the initial price of the item. In more affluent families, the children are often provided with credit cards to buy clothes for themselves and gas for their cars. Many of these dissolve over debt-related problems, but usually the children are buffered from the circumstances and never make the connection.

Once married and on their own, a young couple attempts to duplicate in three years what may have taken their parents 20 years to accumulate. The results are predictable. Within three years they have a lot of assets, but they're all tied up in liabilities. Many, if not most, experience the following symptoms.

Symptom 1

They can't pay the monthly bills. Once the maximum limits have been reached on credit cards and other readily available credit sources, the pressures begin to build. Creditors begin to harass (usually the wife), and each month it gets worse. Finally, in desperation, a bill consolidation loan is made. This lowers the overall monthly payments and extends the debt for a longer period of time. A resolution is made to avoid the credit trap, and the pressure is eased. Within a year the small debts return (the consolidation loan eats up all the available surplus), and the situation is worse than before.

Symptom 2

More income is needed. This conclusion seems logical at the time, because they have already tried a consolidation loan, and more credit can't be the answer. So, usually the wife goes to work. If there are small children, the result is a break-even situation or less. But, where no children are involved, the end result is more money in and more money spent. Usually, within a year or less, the bills are larger rather than smaller, and the pressures are even greater, because now the extra income is necessary.

Symptom 3

Can't stand the pressure? Buy something new. Usually by this time the financed car and washing machine are breaking down, the house is beginning to need some repairs, and marital pressures are reaching a boiling point. The logical thing to do seems to be to buy a new car or take a vacation to "get away from it all." Unfortunately, it always gets worse later. Now desperation sets in, and loans are solicited from family and friends. Many well-meaning Christians get involved with a "bail-out" program at this point, thinking they're helping without realizing they're only dealing with the symptoms rather than the problems. "A man of great anger shall bear the penalty, for if you rescue him, you will only have to do it again" (Proverbs 19:19).

Symptom 4

Divorce or bankruptcy. Once the financial pressures build, the marital pressures build as well. It's difficult to have much communication when all you ever talk about are problems. The wife feels insecure, and the husband gets very defensive (or vice versa). For a few families, bankruptcy seems to be the solution, so they liquidate the debts and begin again (literally). Since credit is easy to come by, they have no difficulty borrowing again, particularly since they can't go bankrupt again for several years. Within a short period of time, many of these couples face the same symptoms that prompted the bankruptcy. Those who elect divorce find that the same symptoms appear in their next marriage. Fortunately, out of a feeling of panic, many seek immediate help. Many don't, however, and eventually find second and third marriages ruined by the lack of a sound spiritual and financial foundation.

It's bad enough that these symptoms occur over and over again in the non-Christian community. If we Christians were truly living by sound biblical principles, our lives would be lights to attract those who so desperately need help. In fact, nobody really wants to lose a marriage, go bankrupt, or commit suicide. They do so because they have lost all hope. But an even greater crisis is that the same symptoms are occurring within Christian families -- and at about the same ratio. This crisis can be traced back to not teaching or applying the basic biblical principles God has established for us. Some principles are so fundamental it would seem every Christian would understand them. But unfortunately they don't.

EARLY ATTITUDES
  1. Borrowing - "The wicked borrows and does not pay back, but the righteous is gracious and gives" (Psalm 37:21). Scripture clearly indicates that borrowing is NOT normal to God's plan, and it never was intended to be used as a routine part of our financial planning. Logically, it should be limited to appreciating assets, but Scripture does not say to borrow only for appreciating assets. It says to repay what is owed. Children should be encouraged to save for needs, not borrow to get them. Parental examples of trusting God to provide without borrowing are woefully lacking today.

  2. Saving - "There is precious treasure and oil in the dwelling of the wise, but a foolish man swallows it up" (Proverbs 21:20). In our upside down inflationary economy, spending and borrowing are promoted as logical, and saving is discouraged. But let me assure you that those who borrow and spend always look for a saver in time of crises. Children should be taught that it is sounder, biblically and financially, to save for future needs than to rely on creditors. It's a sad indictment of how far we have strayed from God's truth when the average 65-year-old man today has accumulated less than $100 in free and clear assets.

  3. Avoid Hasty Decisions - "The plans of the diligent lead surely to advantage, but everyone who is hasty comes surely to poverty" (Proverbs 21:5). Patience and consistency, rather than quick decisions and "instant" success, are the ways to financial security. Children should clearly understand that a firm financial foundation is built by taking small steps over a long period of time. They should also remember that God's plan is not the same for everyone. Children are not promised automatic affluence just because their parents have it. One of the best disciplines a parent can teach a child is to allow him or her to work to reach a goal. Too often everything is given without effort, and this can easily develop into a lifetime habit.

  4. Budget - "Poverty and shame will come to him who neglects discipline, but he who regards reproof will be honored" (Proverbs 13:18). Every one of our children should learn to live on reasonable budgets. The best way for parents to teach a budget is to live on a budget themselves. There is no greater financial asset that parents can leave their children than to know how to establish and live on a balanced budget. Overspending should be so discouraged in Christian homes that children wouldn't even consider it a possibility in their own homes later. Remember, at best, the tug of worldly ways will tempt them to go down the wrong paths. At worst, the lack of training will send them down these paths without a way back.


HOW TO HELP

Obviously, many more principles that are needed to steer our families and friends down the right path to God's plan are found in God's Word. I encourage every couple to start a study of God's financial principles and begin to implement them in your own lives. If you need an excellent guide, call Christian Financial Concepts at 1-800-722-1976 or click here to find a listing of biblestudies and the workbook: How to Manage Your Money.

Once you have applied God's principles in your own lives, begin a Bible study in your church or home and share what you've learned with others. Help your church establish a regular teaching program on biblical finances and a counseling program to help families that have symptoms already. A part of every pastor's premarital counseling program should include a course on biblical principles of finance and a course on budgeting, in which the couple actually establish their first year's budget.

CFC also has a premarital workbook called Money Before Marriage that is recommended for engaged couples and newlyweds. Click here to view that workbook and the list of other CFC guides for couples.