Diligent To Know
"Be diligent to know the state of your flocks, and look well to your herds; for riches are not forever; does a crown endure to all generations?" (Proverbs 27-23:24)
The wonderful book of Proverbs will so often take simple aspects of life and provide deep lessons to apply for our daily lives in other areas. In viewing commentaries for these verses, I have seen it include the application to church and family ministry, running a business as well as the obvious parallel to know the state of your finances and investing. Today, we will mainly look at applying it towards debt freedom.
The key word in this scripture is diligent... we see it in many verses. Its definition includes "having or showing care and conscientiousness in one's work or duties", it implies to be industrious, attentive, thorough and having continuous action.
So how would that look in reducing our debts? The first step is to know where you are at, both in the overall picture and what is happening currently. Write down all of your debts, the total amounts and the minimum monthly payments. In one place you can now see what is in front of you - and later we will go over a proven plan to reduce those debts.
Next, for one to two months, keep your receipts and record every dollar you spend and what it was for. This is critical, as it will show exactly where your spending is occurring that you may gloss over repeatedly and not know just how much is going to that category. Many years ago I did this exercise with sticky notes and it worked just like an X-Ray, showing me where spending was occurring and how much was underneath my daily conscience, which prompted changes to occur.
This is a trickier age to curb spending, because of how credit cards are used in the majority of purchases. It is an ideal setup for the card companies to make money - allow the card holder to build up charges throughout the month without their direct knowledge of the total amount, and then slap them with the big, accumulating bill at the end... complete with exorbitant interest charges should the amount not be paid in full.
You can be diligent in this area. Go to your card website and view your accumulating charges at least once per week. That will prevent a "sticker-shock" moment from happening when the monthly bill comes in to pay, and will help keep you in line throughout the month.
Having recorded all your spending and keeping tabs on that credit card balance during the month should help reduce some excess spending, and now we can look towards paying off those debts.
On the sheet you made with all your debts and minimum monthly payments, take the one with the lowest monthly payment and aim to pay up to 10% of your monthly income in addition to that minimum payment - while for the other debts, only pay that minimum monthly amount. Continue to do so until that first debt is paid off... then the next month you now have freed up the monthly payment you were making to the first debt, and have that entire amount to roll into the next debt with the lowest minimum monthly payment, and so on.
From paying off that first bill, you will feel strengthened that you have a level of control over these debts and optimism for the future as you are seeing a plan moving forward to be debt-free. And by being excited from the results, you will find other areas to curb excess spending. If you are diligent, you can be encouraged that the average household will pay off all their debts in 3-4 years, and can then pay off their mortgage in another 3 years!
My wife Karen and I teach a free 3-hour comprehensive class on how to gain back control of your finances and be debt-free. The class also focuses on the supporting scriptures that it is God's will, which I believe makes all of the difference in remaining diligent and encouraged to becoming debt-free. Consider it this way - going to the class will give you more ammunition to work with then you have currently. Please contact Broomfield Assembly if you are interested in attending a future class.
Lastly, if you believe it is God's will for your household to be free of debt, then be encouraged to pursue that goal by what is written in Romans 8:31 - "What then shall we say to all of this? If God is for us, who can be against is?
God Bless you and may He show Himself greatly to you,
Paul
