Debt is so common these days that living debt-free is counter-cultural. In fact, the average American has three credit cards and an average balance of over $6,500. This is even higher than last year! Americans now owe over $4 trillion in consumer debt.

But this is hurting more than the bottom line in our pocketbooks. It actually hurts our overall health and even our relationships. More marriages dissolve due to money matters than adultery or abuse.

God’s Word is very clear that mismanaging our money is plain foolishness. Proverbs 21:20 says, “The wise have wealth and luxury, but fools spend whatever they get.” And if we’re in debt, we’re not only spending everything we get, but even more than we get. When we spend money we don’t have on things we don’t need to impress people we don’t like, that’s foolish!

If you’re in debt, you didn’t get there overnight. You won’t get out of it overnight either. It takes a decision to be intentional and disciplined with a plan.

10/10/80 Plan

One proven plan that works every time is the 10/10/80 plan. It goes like this:

  • Bring 10% back to God. God always blesses whatever you put Him first in.
  • Save 10% for your future. Why pay every other company and forget paying yourself?
  • Live on 80%. Enjoy the rest of what you have. Choose to live within your means, even if it means doing without for a while. As Dave Ramsey popularly says, “Live like no one else now, so you can live like no one else in the future.”

Steps to Get Out of Debt

But that still leaves the question of how to deal with already accumulated debt.

Here are some practical steps you can take today:

  • Ask for a lower interest rate. You’d be surprised what making a big ask will do.
  • Double your minimum payment. Get aggressive about getting out of debt.
  • Use the Debt Snowball Method. Pay off your smallest debt first while continuing to make minimum payments on your other debts, then tackle them one by one in order of smallest to largest until you’re out of debt.

It’s possible to be wise with our resources and actually have freedom from the stress that so often goes along with this area of our lives.

We’ll be starting a new Financial Freedom class soon to learn solid biblical principles for our finances. If you’re interested, let me know and I’ll get you all the details.