Sunday, January 25, 2009

Does the End Justify the Means?

I've read my fair share of financial books but there are a couple which really stick out in my mind as having a major impact on my outlook. One of these is Rich Dad, Poor Dad by Robert Kiyosaki.

There are many things I have been able to take away from this book which have challenged my thinking. The greatest challenge however is Kiyosaki's idea of "good" debt and "bad" debt. Kiyosaki believes that you should leverage other people's money to make money for yourself. How you leverage other people's money is by borrowing from them, another way to say you have to go into debt. Although I understand his outlook and it does make sense to me I really had to stop and match up this concept with concepts from the Bible. This is something I touched on briefly in my post on "what is debt?" but I would like to go into more detail here.

The logic behind leveraging debt makes sense. If you buy an apartment complex with borrowed money from the bank and turn a profit on that regularly, a profit that more than pays for the monthly payment you now have to the bank, then this processes will gain you money in the short term and probably in the long term. Mathematically it's sound.

Another example is leveraging 0% offers to make money. It is argued that you should take 0% offers on credit cards or other debt opportunities because this can also make mathematical sense. If you have $2,000 on a credit card with 0% interest it would make more sense to put $2,000 in an interest bearing account than to pay off that $2,000 credit card.

I tend to be a very logical person who likes to run the numbers on everything. I think that's why it was so hard for me to see the truth in this instance. The truth is, the end doesn't justify the means. Just because going into debt could earn you more money or because it makes mathematical sense when you run the numbers, doesn't make it right. This was, and sometimes still is, a very hard concept for me to grasp.

God is very clear about his stance on debt in the bible, just check it out for yourself (Romans 13:8, Proverbs 22:7). Although it never says going into debt is a sin, it makes a very clear case for why you don't want to do it. It doesn't make any concession for debt that makes you money or for debt that doesn't have an interest rate.

The really tricky part in all of this is truly applying it to my life. What does that mean about buying a house? It can't possibly mean that you shouldn't buy a house until you can pay for it 100%.... right? Well, from reading what the bible says, I have to conclude that's exactly what it means. The same thing goes for buying cars or furniture or education.

As you know by now, if you've been reading this blog, I do have debt. So I have not followed what the Bible has to say on this. To be honest with you, even now knowing what the Bible has to say I don't think I would follow it when it comes to the house. The truth is I'm impatient and don't want to wait the 5 or 10 years it would take to save up that kind of money. It's harsh reality but I have to be honest with myself.

I'll just leave it as something I'm working on. I'm not perfect yet. I hope to not get into debt again, now that my choices are made. I will work hard on getting out.



Interesting that you say 5-10 years of savings for a house. Is that how much time you think it would take to save, however much it is you need for a home?

5-10 years without interest, seems like a long time, but not in comparison to a 30 year mortgage.

Mathematically, as you put it, I bet the numbers are quite different as well.

With all that being said, what about future purchases? Car, school, and possible future homes?


I respect your opinion and think it is a safer route financially. However, I don't think the Bible prohibits barrowing money. Rather God permits and regulates.

Exodus 22:25 "If you lend money to any of My people who are poor among you, you shall not be like a moneylender to him; you shall not charge him interest."

Leviticus 25:35-37 "If one of your brethren becomes poor, and falls into poverty among you, then you shall help him, like a stranger or a sojourner, that he may live with you. Take no usury or interest from him; but fear your God, that your brother may live with you. You shall not lend him your money for usury, nor lend him your food at a profit.

Psalms 15:5 "He who does not put out his money at usury, Nor does he take a bribe against the innocent. He who does these things shall never be moved.

Psalms 37:21 "The wicked borrows and does not repay, But the righteous shows mercy and gives.

Psalms 37:26 "He is ever merciful, and lends; And his descendants are blessed.

Matthew 5:42 "Give to him who asks you, and from him who wants to borrow from you do not turn away."

Luke 6:34 "And if you lend to those from whom you hope to receive back, what credit is that to you? For even sinners lend to sinners to receive as much back. "


You do realize that the majority of your verses are speaking to you in the manner to which, you would be the lender, not the borrower...


I do realize that, however my point is that I don't think God prohibits lending money.


I agree with you Craig, that God doesn't prohibit lending money. Your verses compliment my own on this matter. He only prohibits borrowing money, not lending.


Lending and borrowing go hand in hand. How is one prohibited but not the other. Why would God give direction on how to do something if He doesn't want the person on the other side to participate? The real issue is repayment.


"How is one prohibited but not the other? Why would God give direction on how to do something if He doesn't want the person on the other side to participate?"

Excellent questions that I don't know the answer to. I have struggled with those same questions. Although I don't always know why God says what He says I have to just take it on faith since that's clearly what the Bible says on the subject.

If I had to venture a guess, I would say it's because he's already paid the price to get us out of the slavery of sin. It seems like kind of a slap in the face to jump into the slavery of debt after that. He wants us to be free to follow his leading. Being in debt ties us down so we may not be able to follow his lead. Lending, on the other hand, doesn't tie us down.

I don't have all the answers on this one. It's on my list of things to ask God once I see him in heaven.

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