Next on the list of Principles is to Cut your Credit Card (if necessary). As discussed early on,
a credit card is not bad in itself; it is the unmindful use of plastic that is detrimental to us. There is a
warning for credit card holders that if you can not pay your monthly bill in full, it may be best to cut
your credit cards to end the vicious cycle of debt upon debt. Also, the author warns us against the
peril of using your credit card to borrow money to help someone else. Many have fallen into this trap,
a friend of mine for one borrowed a sum of money through her credit card to lend it to someone else.
When it was time to pay the debt, her debtor was nowhere to be found leaving my friend the burden
of paying the money she borrowed.
We must live by the principle that if God wants us to give, He will give us money to do so.
God never asks us to give money we do not have. If you do not have money to help another, simply
apologize and say that you cannot help.
Tips for using a credit card:
(1) Get one credit card only if your work or business requires it.
(2) Never recklessly charge to your credit card purchases that you don’t have cash for.
(3) Pay the total bill on time.
(4) Don’t be greedy for points.
Those who are dependent on “5-6” are not exempted from this principle. People who are
dependent on “5-6” must free themselves from this loansharks.
Under this principle, the dilemma on when to borrow and not to borrow is also discussed. I
for one am not a fan of borrowing money. I learned that even if I don’t have a cent in my pocket, I
am way more rich than a person who has a lot of money but is way too deep in debt. The following
tenets are to be considered when deciding whether or not to borrow money.
Do not borrow anything that depreciates. Better save first before buying.
It’s OK to get loans to but a house or a unit. But be wary of banks or financing companies
fixing the interest rates for only one or two years as they are prone to increase it anytime. It
is wise to have substantial savings first, before you consider buying a house or unit.
Don’t borrow to pay off your debt, unless it is an interest rate that is lower than your existing
one.
Don’t borrow at high interest rates. A difference of anything higher by 6% a year compared
to others is too high.
I think this part of the journey to a Debt-Free Lifestyle is one of the most important steps to
take. Ultimately you have to decide to pay off all your debts and plan a strategy to actually do it. If
you are a person who incurred large amount of debt, you might feel suffocating and hopeless just by
thinking of how to pay for all of it. However, the author presented a story where we can see how
starting small step is a big leap to paying off your debt is already. In the case of Lena, she paid all the
people she owed to first. Then she chose the credit card company where she has the smallest amount
of debt until such time she was able to pay for all of it.
Of course paying of debt requires certain sacrifices like giving up your luxurious lifestyle and
settling to a more disciplined one. You must learn to tighten your belt and work diligently until you
are able to pay everyone. You must also learn to explain to your creditors your circumstances and ask
for leniency. In turn, you do your best to earn money to pay them all. Of course the journey to
demolishing your debt must be peppered with prayer, seeking the guidance and provision of our
Almighty God.
The fifth principle is Education, the Greatest Wealth Equalizer. Education really sets a person
free; be it from debt, hardships in life, ignorance, inequality etc. Filipinos are firm believers that
education is still the best gift they can give to their children. This is evident in the quality of overseas
Filipino workers we are sending overseas each year. Because most Filipino’s are educated there is no
problem for them in finding jobs. The problem lies in the way Filipinos spend their money. The
concept of saving for our future is still very new that’s why many opt to but things that they don’t
really need. They need to focus more on educating themselves financially. Learn ways on how they
can properly invest their hard-earned money to have a passive source of income.
Next is Family Planning. In the recent years, more and more teenagers get pregnant without
considering the consequences of such pregnancy. Sex has become so casual that even teenagers
engage in it resulting to unplanned pregnancies. Add this to situations where the husband and wife
are barely able to support themselves yet they continue to have more and more children. Many
couples just like the thought of having a kid of their own without stopping to think if they can give
the kid a comfortable life. The author tells you that if you desire to build a family, then you must plan
for it. Good family planning does not rest on having one or two kids. Good family planning is
determined by whether or not your child will be able to live a comfortable life, with a roof over his
head, food on the table and clothes on his body. Of course, he must be able to attend school and he
must be adequately take cared for.
Then there is the principle of being Grateful to God, Generous to Others. The bible teaches us
to be thankful in ALL circumstances. God did not qualify whether you should only be grateful in good
circumstances. By being grateful, you show the extent of our faith in God’s sovereignty and provision.
Gratefulness also leads to contentment. When you are content with what God is blessing is you will
not feel the need to clutter your life with things that you do not really need. Besides, you can rest in
God’s promise that He has a wonderful plan for you. A plan to prosper you and not to harm you. So,
be obedient to God’s command. Give thanks!
The author also reminded us that we must always choose Honest, Hard Work (Not easy
Money). King Solomon, the wisest man in the bible said, hard work is the key to steadily accumulating
wealth over time. Wealth coming from get-rich-quick schemes quickly disappear. Many people are
scammed by these schemes because most of them don’t want to work hard but would want to earn a
lot of money. Some even resort to collecting bribes. The bible advises us to do honest, hard work
instead. This is the only kind of work that pays out in the end. The stories shared by the author clearly
depict the truth in this principle. Both worked very hard early on in life. They were taught to live
frugally and just to live within their means. Also, the importance of saving was instilled in their mind
early on. In the end, they grew up to be successful and rich individuals.
The second to the last principle is Invest for the Future, Invest also for eternity. This chapter
speaks about passive income. People should not be contented with just one source of income. Each
one must strive to find a way to make their money work for them. “How is that?” you say. First, set
aside a part of your income and invest the said amount. Look for an investment scheme with
compounding interest. Here, although the interest is small, such interest is doubled over time giving
you more earnings compared to just letting your money sit in the bank. More important than this, the
bible teaches us to save for eternity. How? First, by making sure that you are a Christian. From there,
we can invest our treasures to winning of souls and making disciples by giving our tithes and offerings
to the Lord for the furtherance of His kingdom. Having not enough money is not an excuse because
we can also invest our lives by serving full-time in the ministry of God.
The last principle is Principle 10: 10-20-70. This part teaches us to give 10% to the Lord, save
20% and spend 70% of our income each month. Let’s talk about tithing. Tithing is a God-given
principle that unlocks the blessings of God. In fact, this is the only time that God allowed us to test
Him. He promised that he will pour out so much blessings we will not have any room for it if only we
are faithful in tithing. It also stretches our faith in God that He will do as he promised. It is also our
way of worshipping God and thanking Him for His faithfulness in blessing us.
In totality, the ten principles if followed correctly will really direct us toward a debt-free
lifestyle.