Don't Get Trapped, Deal with Debt Wisely

Debt is a classic issue in human life. Many problems begin with debt. A good name, friendships, even family ties that were once harmonious can be damaged because of this. In fact, the Bible records many parables and warnings concerning those who are in debt.

When expenses are greater than income, debt becomes one of the shortcuts people often choose. Expenses keep rising, while income still has not increased, so the temptation to go into debt appears. Moreover, in this day and age, debt is something common, and it is even made easier by lenders.

However, is debt really able to become a solution for overcoming financial hardship? How should we respond wisely to the matter of debt?

Debt, the Road to Becoming a Slave?

From ancient times until now, human eyes have easily been blurred by luxury, making it hard for us to distinguish between needs and wants. Even more so in modern times, when social media, advertisements, the ease of shopping online, and the many credit options greatly influence people's consumptive behavior. With just one “click,” a person's desire is immediately fulfilled, no matter that the list of debts keeps growing.

At first glance, going into debt seems to be an easy and quick solution for achieving material ambitions. Unfortunately, debt has the potential to create long-lasting problems. A person who was initially living comfortably is tempted to use a credit card because of various discount offers. Because of becoming addicted to shopping without proper calculation, in the end he becomes entangled in debt, then pursued by debt collectors. His good name is stained, and his life is far from calm and peace. 

Therefore, before going into debt, think carefully about the advantages and disadvantages. Consider your financial ability. Do not be tempted by things that are sweet at the front, but end bitterly at the back. If you are already in debt, whether you want to or not, you must repay it according to all the terms made by the lender. It is no wonder that the book of Proverbs describes the person in debt as a slave to the one who lends to him.  

The rich rules over the poor, and the borrower becomes the slave of the lender. – Proverbs 22:7

If debt is likened to “enslaving oneself,” how careful we must be in deciding this matter. Do not let us become a slave in the real sense, bound from one debt to the next. Life becomes miserable because income is spent paying debts. 

Debt, Making Life Complicated?

Owe no one anything, except to love one another. For whoever loves his fellow man has fulfilled the law. – Romans 13:8

In the Firman Allah Yang Hidup (FYH) version, the first sentence is written as: Pay all your debts… In other words, God does not want His people to be burdened by matters of debt. As much as possible, pay off your debts promptly. 

On the other hand, the Bible clearly warns us to be content with what we have.

Keep yourselves free from the love of money and be content with what you have. For God has said: “I will never leave you and I will never forsake you.” – Hebrews 13:5

This principle is very important, because being content with what we have will keep us from many problems. We will not be easily tempted to buy or own things that are actually not vital needs.

When you experience financial hardship, try reflecting: perhaps this is happening not because of your inability to earn money, but because of the size of the bills that must be paid every month. 

Instead of thinking about covering it with more debt, it is better to examine your cash flow. Perhaps there are budget items that can be reduced or eliminated. If debt installments feel heavy, do not hesitate to ask for restructuring in repayment, if possible, so that your finances become healthier.

Sometimes it is human beings who create their own problems. Life is already sufficient, but we want to be richer, we must have this and that for the sake of prestige, to look impressive, and so on. Inevitably, we become entangled in debt and live in hardship. As it is said in Ecclesiastes 7:29 according to the Indonesian Masa Kini (BIMK) translation:

This alone is what I have found: God made us simple and ordinary. But we ourselves make our lives complicated and tangled.

Borrowing Is Permissible, As Long As …

A life free of debt is certainly pleasant. Even so, in certain matters, there are times when debt becomes the only way out. Of course, this can be done while still taking into account all the benefits and risks involved.

1. Productive, Not Consumptive

It would be much better if we were able to start a business with our own capital. However, if we have to wait until funds are collected, when will we be able to start the business? Indeed, business ideas without capital have been widely promoted lately. However, not every type of business can be started that way. Capital remains the main resource for entrepreneurs in starting a business. 

For example, you buy a car on an installment plan to be used as a business asset (for example, delivering goods). Of course this is not the same as buying a car merely to prove your ability to live a certain lifestyle. 

So, only with careful risk calculation and the right financial strategy, may the step of borrowing money be taken. 

2. Clear Benefits, Increasing Value

Buying or renting a place to live is an unavoidable primary need. Buying a house in cash is usually cheaper than through a mortgage (Home Ownership Credit). However, even if the interest is low or there are no administrative fees, the total credit we pay is still much greater than a cash payment. 

The problem is, not everyone can gather hundreds of millions of rupiah in a short time. At times like this, a home ownership loan can be a solution. Instead of spending money every year on rent, you choose to pay for a house according to your means. In the future, you can live in peace, without needing to keep moving from one rented house to another.

In this case, just think of it as saving, though not in the form of money. The selling value of a house usually tends to increase, and when accompanied by a number of careful calculations, it can become a good investment, even though you have to tighten your belt at the beginning. 

When your financial condition declines, increasing your income is the ideal solution. However, do not forget to examine your cash flow: which budget items can be reduced, eliminated, or restructured? If you must go into debt, consider all the risks, and make sure that the borrowed funds can be used productively and will have clear benefits in the future. 

God bless you! 

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