This is the second of short series on giving that was triggered by an article originally written by Asher Intrater in 2003: Giving – A Highly Effective Ministry. The first article looked at the motives for giving; this article considers the question of giving from a place of debt.
Donors with Debt
I have been involved with processing on-line card donations for an international ministry over the past ten years or more. In this time, I have observed two phenomena that trouble me. The first is that a number of regular donations – that is, donations made automatically against a card on a periodic basis such as monthly or quarterly – are declined on their nominated day and deferred for a five day holding time. Most are paid on the second presentation, but a significant percentage are declined again and cancelled automatically. To those in the know, this indicates that the card is almost full most of the time, never being fully paid off or cleared down, and sometimes the value of the donation would take it (or its underlying bank account) over its credit limit. In other words, the donor is carrying a significant sum of continuing uncleared debt.
Secondly, a number of donors include text with their donation asking the ministry to pray for them because of financial difficulties, or for them to become “debt free”. Again, this bespeaks donors who are struggling to clear their debts or manage their finances on a regular basis.
What is Debt?
Let’s start by clarifying what debt is. Although there is some debate between experts, I split debt into three simple categories: investment finance, necessary debt and unnecessary debt.
Investment finance is borrowing undertaken on a secured basis against an appreciating asset. In order to purchase an asset (such as a house or a business) that is reasonably guaranteed to increase in value, borrowing is undertaken to make the necessary purchase price available. The lender will take a mortgage or lien against the asset to protect the loan and charge a lower rate of interest because they have that security. The most important attribute of this kind of borrowing is that the value of the loan is always less than the value of the asset, so that at any point the asset can be sold to repay the loan and leave the borrower clear of borrowing. Notice that vehicles – unless collectible – never fall in this category.
Necessary debt is borrowing that is undertaken as a necessary part of life, either against a depreciating asset such as a vehicle needed for travel to and from work each day, for emergency healthcare fees, a season-ticket loan offered by an employer, for essential and unanticipated housing maintenance, and so on; for expenditure beyond the borrowers reach that must nevertheless be made. Such loans are usually unsecured and a higher rate of interest is charged to reflect the greater risk to the lender. Unlike investment financing, there is either no asset to sell to repay the loan, or the asset is worth less that the outstanding value of the loan.
Unnecessary debt is borrowing where there is no business or personal need. This may cover items such as second cars, holidays, house furnishings and redecorations, technology (such as computers, mobile telephones, hi-fi equipment, televisions, etc.) that is not strictly necessary for work, and living expenses beyond basic necessities; everything that is not covered by the previous two categories. It is almost always optional and can usually be avoided by appropriate budgeting and self-restraint.
The Bible and Debt
The Bible is very specific about its condemnation of debt. From the Proverb writer, who points out that:
Proverbs 22:7 The rich rules over the poor, and the borrower is the slave of the lender.
to Yeshua who insists that:
Matthew 6:24 No one can serve two masters, for either he will hate the one and love the other, or he will be devoted to the one and despise the other. You cannot serve God and money.
to Paul who admonishes:
Romans 13:8 Let no debt remain outstanding, except the continuing debt to love one another.
it seems clear that debt – debt that cannot be repaid – must be avoided and compromises our ability to serve God, either with our finances or in other ways. I would argue that clearing all unnecessary debt and, where possible, necessary debt, takes priority over all but the most basic giving requirements. Debt is dishonouring to the kingdom of God and must be settled as soon as possible, but no later than on schedule. Because of interest charges, which can be larger than the debt repayment amount, future income is always being drained away, reducing one’s ability to give or support other kingdom causes.
But I want to Give!
Giving can only be undertaken out of what you have, not out of what you don’t have. Consider the scenario where a person makes donations beyond their means, through debt, and is then unable to settle or service that debt. To protect their position and as part of voluntary or statutory debt counseling or consolidation, the lender agrees to suspend interest or even write-off part of the debt. Essentially, the lender has unwillingly made the donations that were originally given. It could be argued that the donor has stolen money from the lender to give it to the recipient.
Once a person reaches a place of debt, charitable giving and ministry donations must be suspended – unless an openly declared part of an approved debt management plan – until the debt is repaid. It is dishonest to take money that belongs to the lender and give it – even if declared as firstfruits or a seed donation – to a ministry. You cannot claim God’s promise that He will be no man’s debtor, or will open the storehouses of heaven for you by giving what is not yours to give. If you are ahead of your schedule or are blessed with some extra income, you should donate no more than a token amount; the bulk should be added to your next repayment to reduce your debt more quickly.
But I can’t Give
Debt is sometimes used as an excuse for not giving. When a person’s spending habits have not been brought in line with their needs – they fund lots of purchases of stuff they don’t need with unnecessary debt – they make the paradoxical claim that they can’t afford to give, but seem to have lots of money for other things. Lack of discipline or a failure to budget must be addressed to reduce and eliminate debt, then there will be sufficient funds both for giving and for needs.
So What Should I do?
If you are struggling with debt, you need to get professional advice and counseling. You need to meet with those to whom you donate regularly, explain your situation and either stop giving or reduce your donations to a token value so that you can concentrate your resources on getting out of debt as quickly as possible. You should not make a donation with funds that are not yours and ask God to repay that by easing or settling your debt.
We seek to honour God and the ways of kingdom finance, accepting the funding that He provides through His faithful people as He lays projects and the desire to give on their hearts. We in turn offer a tithe out of our ministry income for the wider kingdom ministries and activities with whom we are connected. This is the way the finances of the kingdom are designed to work.