New car depreciation is another important factor when considering taking on a sizeable auto loan. Should a family's financial circumstances change, trying to sell an almost new car to relieve debt will be difficult. Most families owe more on a car that is one year old than its actual value, a condition often called being "upside down." Whether a family buys new or used, the ultimate goal should be to save enough to pay cash for the vehicle. To do this, a family must continue to set aside all or part of their car payments after an auto loan is paid off, building up savings to be used as a down payment on the next car. If this practice is followed faithfully, eventually it will be possible to purchase a car without financing.

5. Failing to schedule "disasters." In order to plan a financial disaster, all a family has to do is fail to plan for predictable expenses that haven't come due yet, such as automobile maintenance, emergency home repairs or personal injuries. Failure to plan for these is a major reason many families end up in unmanageable debt. When expenses occur they must be paid, so the only alternative available is often a credit card.

Why do people fail to anticipate inevitable expenses? Generally when they try to work them into their budget they don't fit, so they simply ignore them until a crisis occurs. To do otherwise would require adjustments in the other areas of spending, such as housing, automobile expenses or recreation. The credit card debt invariably grows in order to absorb these non-budgeted but predictable expenses.

My concluding advice is spot financial issues before they become giant problems by having and maintaining a written financial plan, including a budget. This will help avoid debt. Even if you are currently in debt or struggling from financial problems, Crown can help. Give us a call or visit our website. I recommend you take our free MoneyLife® Indicator assessment, available on the site, for a clear picture of nine specific issues related to your current financial health.

(c) Baptist Press. Used with permission.

Chuck Bentley is CEO of Crown Financial Ministries. His latest book, The S.A.L.T. Plan, How to Prepare for an Economic Crisis of Biblical Proportions is available now. To sign up for Chuck's free weekly e-newsletter, "Handwriting on the Wall," visit Crown.org/handwriting or call 1-800-722-1976. Get Baptist Press headlines and breaking news on Twitter, Facebook, and in your email

Publication date: March 27, 2013