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Why Many Are in Debt

MICHAEL and Reena celebrated their first wedding anniversary by returning to the place of their honeymoon. But at the threshold of the second year of their marriage, they came face-to-face with an unpleasant reality. Regardless of how much they economized, they could not pay all their bills.

Consider another couple. Robert had only a small student loan to pay off when he married Rhonda, and she had only car payments. Robert says: “We both worked full-time, and between us we made $2,950 per month. But we weren’t getting anywhere.” Rhonda observes: “We hadn’t made any major purchases or done anything outlandish. I just couldn’t understand where our money was going.”

Robert and Rhonda were not lazy. Neither were Michael and Reena. What was their problem? Credit-card debts. Within the first year of marriage, Michael and Reena owed $14,000 on their credit cards. After two years of marriage, Robert and Rhonda’s debt on their cards totaled $6,000.

Anthony, a middle-aged family man, also faced the financial crisis of his life. His problems, though, were not related to credit cards. In 1993 the company he worked for downsized, and Anthony lost his managerial position that paid $48,000 a year. After that, providing for his family of four became a big challenge for him. Similarly, Janet, a single parent living in New York City, could barely make ends meet with her yearly income of about $11,000.

While it is true that most money problems can be alleviated with proper management, the fact is that we are living in an age when many are handicapped by walking “in the unprofitableness of their minds.” (Ephesians 4:17) Grace W. Weinstein, in her book The Lifetime Book of Money Management, observes: “Many of the rules of the financial game have changed, turned upside down by an unpredictable economy, new attitudes toward spending and saving, and changing life-styles.” In the topsy-turvy world in which we live, more and more people are finding it increasingly difficult to manage personal and family finances.

Happily, Michael and Reena, Robert and Rhonda, Anthony, and Janet have managed to get a handle on their finances. Before considering what helped them, let us take a closer look at the form of easy financing that has added to the monetary woes of many—yes, credit cards.