Tackling Your Debt


You’ve conquered your fears, overcome the procrastination that’s been holding you back and now you’re finally ready to draw a line in the sand and leave your reckless spending habits behind you.  Unfortunately, making that big decision doesn’t erase all the baggage from your previous behavior.  Many of you will need to deal with the issues surrounding the debt you’ve accumulated.  I hope you find the following steps helpful as you systematically develop a plan for tackling the debt you already have and preventing the need for any more in the future.

1.       Understand the reason why you have each debt. The first logical step is to figure out what got us into debt in the first place.  Was it a result of sinful desires like greed, impatience or materialism or was it involuntary, perhaps from a medical emergency or debt left to you by a former spouse?  This step is a crucial one because it does us very little good to get out of debt if we haven’t first dealt with the root cause.  Ignoring the source is one of the shortfalls I see in many debt-elimination programs.  People get all excited about paying down debt, but then go right back to their bad habits once the debt is gone.  Before you know it, they’re right back where they started.  We’re working toward permanent solutions here and that requires an honest assessment.

2.       Repent of sinful behavior.  As Christians, we know we’re sinful beings with rebellious tendencies.  Step 1 should reveal to us if we have sinful struggles in the area of debt that we need to battle.  If so, we need to repent of those sins and do whatever it takes to claim victory over them.  I can’t stress enough how important an accountability relationship is in this process.  Since sin likes to live in the dark, the best thing we can do is place it under a light to help make it go away.  Having a partnership with someone that will keep us in check is always a good starting point.

3.       Commit to no new debt.  The only exception to this rule will be the situations that survive the 3 Questions to Ask Before Taking on Debt.  The hardest time to stick to this commitment of no new debt will be in the very beginning.  If you’re struggling with existing debt, there’s a good chance that you don’t have much of an emergency savings either.  Without savings, even smaller unexpected expenses can turn your plan on its head.  Those situations will happen, but even if they do, don’t be deterred from the bigger plan.  You’re still in a much better situation than you would’ve been without this commitment.  Seek advice from your wise counsel, deal with the situation the best way you can and move forward with the plan.  Trials will come, especially in the early phase.  How you handle them will dictate your success.

4.       Save for emergencies.  The idea of not taking on new debt sounds great, but it will always fall short if you don’t plan for unexpected expenses.  This is what we commonly refer to as an emergency fund.  The right size of that emergency fund will be different for each person.  The common rule of thumb is to try to save $1,000 for starters.  Consider the risks in your life to determine an amount you’re comfortable with.  Your emergency fund isn’t to be used for anything short of an emergency, so it’s best to separate it from your normal spending money.

5.       Save for future planned expenses.  Once you’ve set aside enough to cover a typical emergency, take a look at the expenses you see coming in the next year or two.  This is an often overlooked step or one that’s placed after paying off debts in many plans, but one I think is extremely important at this stage.  If we’re committed to taking on no new debt, but neglect to plan for bigger future expenses, what do we expect will happen when that day comes?  How can we expect to avoid future debt if we lead ourselves down a path that gives us no other option?  When we avoid borrowing money in the future, we can calculate a payoff timeline for all our existing debts today.  However, if we don’t stop the cycle of debt, there is no end in sight because new debts continue to change the scenario.  From my experience, it’s more important to fix the problem permanently than it is to make the symptoms temporarily disappear.

6.       Pay your debts.  We may not like the debts we have or the lenders associated with them, but that doesn’t remove our responsibility to pay them back.  Psalm 37:21 tells us that “The wicked borrows but does not pay back”.

The idea of paying your debts often brings up the issue of bankruptcy.  From my experience, a lot of people jump to the bankruptcy conclusion way too early in their fight with debt.  I’ve had many people tell me they’re ready to file bankruptcy and wipe the slate clean, but when we get into the situation and look at the details, it’s really not that bad.  It usually boils down to a perceived financial apocalypse brought about by a surplus of voluntary spending in their budget.  There is absolutely no reason to consider bankruptcy when you’re still living a lifestyle of optional spending.  The only thing bankrupt in these situations is the will of the person to fight.

While I think bankruptcy is an often-abused process in our society, some situations do actually warrant it.  Those cases typically involve abusive lenders or extreme mental and emotional stress brought on by the financial strain.  At some point, you may have to protect the person from the situation that’s gotten out of control.

In the Old Testament (See Deuteronomy 15), we read about the Year of Jubilee where all debts were cancelled.  Bankruptcy is a similar process in our legal system that has provided relief for those that get in too deep in order to prevent a lifetime of servitude.  Some people, sensing the moral obligation of their commitment to the lender, will still seek to repay their debts even after bankruptcy although this can sometimes be tricky to do from a legality standpoint.

If you find yourself in trouble paying back your debts, I strongly suggest that you communicate with your creditors right away.  Most of them will be much more willing to help a person that starts the conversation early in the process than they will once you’ve fallen behind.


Getting out of debt isn’t going to be a simple or quick process.  Just as it probably took you many years to get into your current debt struggle, it’s going to take a while to dig yourself back out.  It all starts with that first step of figuring out what got you into debt in the first place.

The initial debt is always the hardest one to tackle because your budget is stretched the tightest at that point and you have the least amount of excess to put toward it.  However, once you get it paid off, you can start to apply that payment to the next debt and so-forth.  That doesn’t even consider that while you’re working on the first loan, the others are still receiving minimum payments that move them closer to being paid off.  By the time you get around to the later loans, it may only take a few months to knock them out.

I highly recommend updating a Personal Financial Statement each quarter in the early phases to lift your spirits.  At times it may feel like you’re not making much ground, but it’s amazing to see how quickly your balances go down when you simply stop adding new debt to them.

Brad Graber, CFP® has been working with clients on personal financial planning and investment issues since 1996.  He invests his time mentoring and educating individuals on ways to be better stewards of the resources God has entrusted to them.


  1. Sapphire on March 14, 2017 at 9:23 pm

    ” Ignoring the source is one of the shortfalls I see in many debt-elimination programs. People get all excited about paying down debt, but then go right back to their bad habits once the debt is gone. Before you know it, they’re right back where they started. We’re working toward permanent solutions here and that requires an honest assessment.”
    This was convicting for me, and just realized that in our home we kept pushing aside this “smaller debt” like it was nothing. We were so excited for this class, but you are definitely right, being honest to ourselves and God is definitely the first step that needs to happen.
    Great encouragement, and practical steps! Thanks Brad!

  2. […] We discussed tackling your debt in this broadcast.  The following recording is from “Mornings with Kelli and Linda” on Moody Radio Indiana (97.9 FM).  You can read the corresponding article here. […]

  3. Chris Clark on March 7, 2018 at 5:15 pm

    “You’re still in a much better situation than you would’ve been without this commitment. ” This is in light of having an emergency fund. Before now after being in the class for 2 months now it has changed the way I think about having accessible funds. Before I always thought pay down the debt first so it was hard for me to wrap my head around changing the way I think but it is clear to me know that you are in a better situation to not accrue new debt in light of an emergency. Thanks for helping me work that out Brad.

  4. Russel Lopez on March 24, 2018 at 7:23 pm

    If you think about it, it isn’t really hard to figure out that things do wear out; shoes, clothes, furniture, you name it. The only question is to determine about when and how much is needed to replace them. From the day the new set of tires hit the asphalt, you can pretty well determine when they will need replaced based on the miles you drive per year. On the other hand, some appliances, like our washer and dryer have been going strong for over 25 years. While they need no repairs today, we know that the day is coming when they will need replaced. However, every day we can delay their replacement gives us more time to save for that event.

  5. Leslie on April 4, 2018 at 2:27 am

    Thank you, Brad, for your sharing your wisdom in how to tackle the issues that surround finances and debt!

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