J. M. Montgomery
Financial Bondage
“Owe nothing to anyone except to love one another; for he who loves his neighbor has fulfilled the law” (Rom. 13:8).
Our society has allowed itself to fall into a trap: a trap created by the Deceiver. The trap is the credit system of purchasing our wants. I am sorry to say that Christians have not avoided this
trap, nor has Christian leadership.
We are constantly being tempted by advertisements showing us large selections of very appealing cars, home furnishings, vacations, and almost anything else we might desire, even church buildings and furnishings. All can be had with “easy monthly payments.” We can see the world on a “fly-now-pay-later” plan. A trip to the local bookstore will allow us to buy (on our credit card) books that will teach us how to “borrow and get rich,” books that list “ready sources of money,” books that tell us how to get rich on the other guy’s money. We read success stories of how vast fortunes were made on borrowed money. The Big Lie has again been perpetrated. Seldom do we read about the bondage that results from the poor use of available credit or the overuse of
leverage.
Our Lord was certainly aware of the problems of borrowing-so aware, in fact, that in His charge to His people, as recorded in Deuteronomy 15:5-6, He pleads with us to “listen obediently to the voice of the Lord your God. ” What does He want us to hear? He is commanding us not to borrow. Why is it so important that God Himself commands His people to stay out of debt? He tells us in verse 6: so that they (the lenders) “will not rule over you.” It is not God’s plan that we should borrow; it is, however, His plan that if we are obedient to His command we shall prosper and not need to borrow. That’s His plan, and it’s much better than the Liar’s, who says, “Fly-now-pay-later. ”
Solomon in his wisdom has told us that when we borrow we become a slave to the lender (Prov. 22: 7). This being the case, let us stop and think about the foolishness of paying for the privilege of being a slave. God’s Word is either true or it is a lie. We must not pick and choose what suits us from His Word; for His Word is true, all of it. Christians, and particularly Christians in leadership, must not submit to slavery, except that the slavery be to Jesus Christ. Slavery to Him costs nothing and offers everything.
A man is charged first to love the Lord, his wife, and his family, then his neighbor as he loves himself. Notice the omission of money. However, when a man is in debt he finds himself thinking too
often of his money problems. I have been told that, for most of us, money occupies approximately 50 percent of our thoughts. I would be surprised if the percentage isn’t greater for those in church leadership. How true the Scripture is that says, “No one can serve two masters; for either he will hate the one and love the other, or he will hold to one and despise the other. You cannot serve God and mammon [money]” (Matt. 6: 24). As our debt grows, our thinking about the debt increases and our thought time for the Lord and our family decreases. Our problems begin to compound and we wonder what has happened to the blessing of the Lord regarding our marriage and the ministry He has given us.
People in Christian leadership must begin to take seriously the problem of getting ahead of God. Bigger is not always better; the worldly trappings of “success” are not necessarily God’s way. God wants to show us His power to provide. When we borrow we take God out of the picture. Not only have we violated Scripture, but we have denied God the joy of showing us His power and provision in our lives and ministries.
Consider this potential situation: your son and his wife need some additional capital for a down payment on a new house. They call you and tell you of the need. They have been good stewards of what God has given them. Your son has a good job and can qualify to meet his obligations. You are financially able to help him with the needed funds. You tell him you would like a few days to pray about it. Three or four days later you call to tell him that, yes, you will help him. However, he informs you that he has gone to the bank and taken a short-term, high-interest loan for the needed funds. Would you be disappointed? Would you feel he had gotten ahead of you in this desire and that he showed little faith in your desire to help him? I think your answer must be yes, and that you would feel a little hurt that the joy of providing for his needs had been taken away from you. Our Father in heaven must feel the same when the leadership and Body pray to Him, ask for His help, and then run to the nearest bank for funds to build His church. All too often I have heard the rationale, “But God provides the funds to make the payments. ” Yes, He does; but consider the amount that is paid in interest that does not go to His work. Might we not trust God before we go into debt? Can’t He provide before the fact? Remember, God did not just suggest that we not borrow; He commanded it (Deut. 15).
Do we need to define the difference between borrowing and investing? Our tax laws have made debt very attractive. We know that it is only through debt that we find tax shelter. To be a good steward of God’s gifts to us we must not needlessly pay more in tax than what is required of us. However, we must not be misguided by tax shelters. Many so-called tax shelters are in reality nothing more than scams. All too often as we approach December 31, the tax twisters come out of the woodwork. We are offered tax schemes that sound too good to be true. Most are just that: too good to be true.
Be very wary before making a decision to invest your hard-earned dollars in such a scheme. A legitimate tax shelter has three distinguishing features. First of all, there must be a potential profit at some time in the future. Now as a rule very few of us would care to invest in anything unless we could hope to make a profit. However, when it comes to taxes it might be very profitable to “invest” a few dollars and gain a many-dollar deduction. In the past, prior to law changes, this was a very common maneuver. A taxpayer would invest a given amount, say $1,000, in an investment that consisted mostly of debt. He would then be required to assume another amount, say $2,000, by way of a note. The note would never be called and he would deduct $3,000, thus gaining a profit through his tax return. The law now requires that the notes be paid. Thus the door has been shut on many scams, for if there is no profit potential, the IRS will disallow the investment on the
grounds that its only purpose is the avoidance of taxes.
A second feature is the requirement that there be some risk, which could result in possible loss. The IRS will not allow you to write off any more than you have “at risk. ”
The third consideration must be that the tax sheltered investment should allow you to defer some of your taxes to a later date. The tax is not technically forgiven; it is simply postponed.
With these three considerations in mind and with the help of competent advisors, you might avoid a tax scam. The problem is that all too many of the tax shelter devices are sold by good honest men who just don’t understand what they are selling. The best recommendation I can give you would be this: know whom you are dealing with from the top on down, not just the salesman, and don’t deal in shelters that have not provided you with a full risk disclosure through a private placement memorandum.
Let us now consider the difference between borrowing and investing. Remember the son who called and asked for help with a down payment on a new home? Should we have suggested that to buy the new home with “borrowed funds” was not the right thing to do? Perhaps in his particular circumstance it was prudent. Why? Let us create a hypothetical set of circumstances regarding his situation. He is now renting (no tax break and no equity growth); he owes nothing for things (cars, boats, television, etc.); his job is very stable, and the potential for future career growth is optimistic. The rent he now pays is very close to what his mortgage payment would be on his new home. He has not made a hasty decision, but has spent weeks looking at houses in the area, with the aid of a trusted real estate professional. The house he has decided on is below the market price for comparable homes in the area. He has sought counsel from trusted Christian advisors and he and his wife have gone to the Lord in agreement, seeking His direction. From the facts given, would you consider the purchase of the new home a prudent investment? I think I would, and I would be very comfortable with this “borrowing.”
Whereas I would consider the above purchase an investment and certainly prudent, I would not say that the purchase of a house is always prudent. Where there is equity growth it might be considered investing. However, to stretch debt beyond a person’s ability to pay or to exceed a budget to the extent that a person must live for the investment is every bit as bad as borrowing for items that don’t grow in value. To borrow for your wants cannot be considered investing, nor is it prudent or good stewardship.
We are sometimes asked to cosign a note for a friend or relative. At times the need is very critical, at least in the borrower’s eyes. We find ourselves on the horns of a dilemma. Do we risk alienation and possible loss of friendship by saying no? It would seem to me that we should consider our friend’s needs and to do all in our power to help him. However, I don’t think we help him in his need when we aid and abet him in compounding his problem. Scripture tells us he should not borrow and it tells us we should not cosign. “A man lacking in sense pledges, and becomes surety in the presence of his neighbor” (Prov. 17: 18). “Do not be among those who give pledges, among those who become sureties for debts” (Prov. 22: 26). Do yourself and the person asking you to cosign a favor-say NO. You will keep a friend and be obedient to God. I bring up this subject of cosigning at this point because in the area of investments we are often asked to cosign. Cosigning for
investments can lead to serious problems in the future.
We have discussed the scriptural reason for not cosigning for a friend. Now let us consider some very prudent thoughts on investing. “The naive believes everything, but the prudent man considers his steps” (Prov. 14:15). Because we don’t want to be naive, and because there are so many business and investment opportunities available to all of us, we must be prudent in our considerations of how or what to invest in. If I were to set out guidelines for a person to follow, I would head the list with a warning against general partnerships. The liability in this form of business arrangement is so potentially dangerous that I can see reason for operating under a general partnership in any kind of business arrangement. Limited partnership, however, offer tax advantages and give the investor a limited liability; thus they become a viable investment vehicle when properly structured. Never, never fail to seek wise counsel prior to getting involved in any kind of partnership.
I would also caution you to be very leery of anyone who approaches you with a “get-rich-quick” deal. We are all aware of the “con man” schemes that we read about. Don’t think it cannot happen to you. It can and most likely will, unless you are on guard against it. There is always someone “out there” willing and able to con you. If in order to get the deal you must “sign here, right now,” then, for heaven’s sake, pass up the proposal. If you are not given time to seek the Lord’s wisdom and to consult with wise counsel, you are most likely meeting a mistake. Investments must come after obligations; thus one should invest with discretionary dollars. It is folly to invest dollars you cannot afford to lose. All too often I see Christians who would not, under normal circumstances, do anything to present a poor witness to anyone, but they destroy their credibility and thus their witness by failure to meet their obligations. Many times this failure to meet obligations is caused by debt brought about by “investment schemes. ”
A person should not invest until he has an adequate amount of the right kind of both life and casualty insurance. Not long ago a pastor friend of mine was involved in an auto accident. Shortly before the accident he told me of his most recent investments and how well he was doing. After the accident, in which he was at fault, he lost everything. Why? No liability insurance on his auto! Think of the poor witness to the non-Christians involved. Think of the loss to his family, not to mention the shame he felt. He had been wrong to invest before his needs were met. What about life insurance? Should a Christian even own any? Some feel that owning me insurance shows a lack of faith in the Lord’s provision of our needs. I have seen others who have life insurance out of proportion to their needs. Each individual has a different need in this area. My recommendation would be, and again I say, seek wise counsel! Your life insurance must be planned as part of an overall estate plan. Your needs should be analyzed and the right amount of the right kind of insurance should be integrated with your will and your estate conservation needs. Your primary concern must be your family. Scripture leaves little doubt as to this. “But if any one does not provide for his own and especially for those of his own household he has denied the faith and is worse than an unbeliever”(1 Tim. 5:8).
In stating that your life insurance needs must be considered in relation to your will, I have touched on an area that too few Christian leaders have given enough consideration: the need for proper estate planning and the need to understand wills in relation to the flock in their charge. Most church and para-church organizations recommend “Christian wills” to their flock or their supporters. I am sorry to say that this usually means “get a will that leaves something to the organization.” Good! I think everyone should not only give to the Lord’s work while he is alive, but should plan to give back part of what God has given him when he goes to be with the Lord. However, this is not the primary purpose of having a will. As a leader in a ministry God has given you, it is important that your own house be in order. Less than 10 percent of the pastors and leaders I have talked to have wills and those that do seldom have more than a very simple will.
Because of the importance of I Timothy 5:8 we would all do well to have a basic understanding of estate transfer or wills. An individual may possess an estate with which he expects to do certain
things for his family: an income for living expenses, college education for his children, a fund for emergencies, etc. Then he dies. When the family receives his estate, it is so much smaller than anticipated that many of the man’s objectives for his family can never come about. Why does this happen?
When a man dies, the estate, in most cases, must first pass through the process called probate. The probate court steps in, takes charge of the estate, and when there is no will a somewhat
disinterested person assigned by the court takes the estate through the expensive process of probate and administration. The family receives only what is left after probate.
We have a tendency to view wills as an inherent human right. In reality, a will is nothing more than a personal action authorized by state law. For most of us, a will, whether a human right or a state-authorized action, is a most important estate planning tool. As Christians we are given the opportunity not only to put our house in order but to make a final witness to the glory of God.
Let’s look at some of the most important advantages of a properly prepared will.
1. Your property will be distributed in accordance with your wishes under all reasonable and foreseeable circumstances, instead of being distributed arbitrarily in accordance with the statutes of
descent and distribution.
2. By your will, you may dispose of your property to the needy and, most importantly, to the work of the Lord, and you may eliminate any and all of those you feel will not be good stewards of the estate God has given you.
3. By your will you can leave particular items of property to selected individuals, such as heirlooms which can be given to those who have particular affection for them.
4. You may leave a portion of your estate to persons and institutions, i.e. your church, employees, friends, colleges, etc. , that would be omitted should you die without a will (intestate).
5. You have the opportunity to nominate an executor to administer your estate and to nominate a guardian for your minor children, rather than have them appointed by the courts without concern for your wishes.
6. By your will, you may avoid the possible difficulties and increased estate costs in connection with inheritances in the case of concurrent deaths.
7. You may provide that the persons you name as executor and guardian be allowed to serve without bond, thus eliminating some expense to your estate.
8. You may make your Christian statement. Your love of Jesus will be read or heard by clerks, attorneys, family, etc. , as a witness and testimony that shows your Love of Christ and of family.
Perhaps the most satisfying aspect of Christian estate planning is to discuss “Christian wills” with someone who has little to leave in the worldly sense but so much to leave in the way of a witness to the world. To deny that person the opportunity to give a witness by way of a will is a shame. Pastors and others in Christian leadership should take time to understand the true meaning of a “Christian will.” It doesn’t just mean “leave something to the church.” It means, more importantly, to be a good steward of what God has given you, not only now but also in providing for stewardship after you have gone to be with the Lord.
It would be an injustice to close this chapter on bondage through poor stewardship without presenting the problem all of us face on a daily basis: the problem of rationalization. Rationalization and the love of money are, in my opinion, the two greatest tools of the Deceiver. Isn’t it a paradox that we talk of heaven but all too many of us strive for things? As I read the Good News I find that our Savior was not guilty of a dual system of values. He didn’t put materialism ahead of the Kingdom. Did Jesus make two kinds of calls to the church leader? Is a leader called to the good life of materialism, or is he called to be a servant of the church? The church must have shepherds. However, the Body must be prudent and use common sense and not follow the shepherds that only see the flock as sheep to fleece (Ezek. 34: 1-7). Church leadership must above all else be truthful. The truth must be more important than fund-raising, bigger buildings, grander programs, etc. As men of God stand up to preach they must preach truth, for unless they preach truth, they are guilty of preaching emptiness. They tickle ears, and in the end are guilty of being false teachers.
It is concealed and tolerated sin that destroys our witness and our testimony. We must accept the truth that we all sin and fall short. We must deal with our shortcomings on an open basis. Our witness or our reputation are only important in relation to our honesty with our God. Love of money and rationalization have caused great ministries to fail. We don’t have to search Scripture very hard to see examples of this; in 1 Kings 3: 11-14 we find Solomon, the king that God gave an abundance of wisdom, rationalizing and hence breaking the law (see Deut. 17: 16-17). From the beginning of his reign he began to accumulate gold, silver, horses, and the trappings of war. He also had the desire to be grand to the extent that he built a larger house for himself than he
did for God. His desire for worldly goods put him into a position of political expediency, i.e. marriage to those to whom he was not spiritually linked. He allowed a little false worship here and a little greed there. The resulting fall is recorded in 1 Kings 11:31.
Money and rationalization played a great part in the mistrial of mistrials, the trial of Jesus. The Bible clearly shows us the part Annas and Caiaphas played in the farce called a “trial. ” Annas, as you recall, had been the high priest and had appointed his son-in-law, Caiaphas, to the position when he himself was forced to step down. Prior to stepping down, Annas had established himself and his family as the only ones able to operate the booths in the Temple. In other words, they had a monopoly. Jesus was a threat to their profit-making venture. The cleansing of the Temple by Jesus was disaster to the continued economic gain of Annas, Caiaphas, and their family. Thus we see that money, or the love of it, played a great part in the crucifixion of our Lord.
One more example of the excesses brought about by rationalization is apparent in the historical church of the sixteen century, in the issuing of indulgences in Luther’s time, and in the belief that through them the pope could draw on the treasury of the saints to remit the penalty of sin, not only for the living but also for the souls in purgatory. As time went on the use of indulgences increased and their sale became an important source of revenue to the pope and to those he favored. Most of the money collected was used for the debts of the pope, generated by the construction of Saint Peter’s Church and the pope’s own lifestyle. The pope’s desire for more and more money to build bigger and greater buildings is all too much like some of today’s church leaders’ desire to show success by being greater and grander than the other fellow. All too often this is rationalized as to the glory of God. Do we think that God really has need for multi-million dollar buildings? The ego of man in his desire for self-glorification seems to still be part of the style of church leadership.
I would be remiss if I closed this chapter without spelling out, in the most positive way possible, what the Word of God has to say about money. I suppose I have read over a hundred books on finance, business administration, and “The Christian and His Money.” Frankly, I have never been satisfied that they gave me the answers I needed to feel good about my stewardship of what the Lord has entrusted to me.
A number of years ago I had the opportunity of working with Paul R. Roper in attempting to solve a very difficult financial problem at a major Christian center. Mr. Roper and I spent countless hours discussing the problems of this particular church and churches in general. Mr. Roper’s background in business and banking had led him to list for himself some basic truths directly from Scripture. I believe these guidelines give direction not found in any other book on business or economics. With his permission, I would like to pass them on to you. I will simply list the Scriptures and challenge you to read each one of them. You see what you can get from God’s Word, as it relates to management or stewardship.
1. Matthew 4:l-10 Be balanced in Scripture.
2. Isaiah 1:19 Promises are conditional.
3. Matthew 19:2 Be willing to be blessed. No false humility.
4. Proverbs 22:7 Don’t borrow for depreciating items.
5. Proverbs 22: 26-27 Don’t be security for others.
6. Proverbs 19: 17 Be generous to the poor.
7. Proverbs 3: 27-28 Pay your bills on time.
8. Proverbs 16:3 Transfer ownership to God.
9. Proverbs 10:4 Be diligent
.
10. Proverbs 15:8 Learn to pray.
11. Proverbs 25:28 Learn to manage yourself.
12. Proverbs 11:1 Don’t cheat.
13. Matthew 20: 1-16 Think as a successful man thinks.
14. Proverbs 21:5 Plan ahead.
15. Proverbs 20:22 Don’t waste time on retribution.
16. Proverbs 18:13 Get all the facts.
17. Proverbs 11:14 Seek wise counsel.
18. 1 Corinthians 9:7-10 Don’t expect to work free.
19. Proverbs 25: 19 Select your associates with care.
20. Proverbs 6:12-15 Tell the truth.
21. Proverbs 8: 13 Actively despise evil.
22. Proverbs 22: 1 Protect your reputation.
23. Romans 13: 1-7 Be subject to authority.
24. Proverbs 25:26 Don’t compromise.
25. John 10: 10 Don’t limit God.
26. Psalm 139 Make a plan.
27. 2 Timothy 3:16 Check the plan out in God’s Word.
28. Psalm 1 Meditate on the Word.
29. Matthew 2:13-22 Be willing to change.
30. Psalm 37:7 Be patient and persistent.
31. John 12:24 If the going gets tough, it does not mean that God is not at work in your life.
I commend these scriptures to you. Study them, pray about them. Understand what God is saying through them. Before you make decisions regarding the ministry God has given you, review this list. It has been proven to me that these thirty-one references, when diligently followed, can make all the difference in reaching the objectives God would have you reach. Look to these scriptures before you get in trouble, not after the trouble has beset you.
