15 Years Debt-Free!
By Carlton and Donna McLeod
On July 4, 2023, my wife and I will be by God’s grace, debt-free for 15 years! It’s hard to believe. 15 years ago, we paid our mortgage down to $.01 online (Bank of America would not let us pay it off through their website), and a few days later, visited a branch to complete the transaction.
I’ll never forget it. Donna, Dori (our oldest child, 3 years old at the time) and I walked into the branch, sat down with a manager, gave her exactly $.01 (a penny!), closed out the loan, and Dori shouted, “We are debt-free!” Dave Ramsey style.
It was a good day.
We haven’t owed anyone anything since then. Below are a few debt-free lessons learned over the last fifteen years.
Money is just a tool. God will always test you with resources. If you have a lot or a little, there will be a test. We learned that the best use of money, other than daily bread, is to advance the Kingdom of God. This manifests personally (learning to manage it while not loving it) as well as practically (giving, blessing others, etc.)
Debt-free doesn’t mean problem free. My wife and I are grateful for financial peace. But there is still a real devil out there. A real world that hates Christ. We deal with our flesh daily. Stewardship didn’t change those realities. Indeed, having control of money can inflame unsurrendered flesh, as it can amplify bad decisions. Too many people think, “If I just had more money, all my problems would disappear.” False. Not even close. A believer must guard against all sin, including idolatry and pride, which money can exacerbate.
You don’t need a credit card. Most people WANT one. But you don’t NEED one. My wife and I don’t have them. Or any loans whatsoever. Or any credit for that matter. And it’s ok. We are still alive! Most people will not subscribe to this way of living, and we get that. But being so subject to financial institutions maybe isn’t wise over the long term. And, lest we forget, the borrower is still servant to the lender. (Pro 22:7) I (Donna) learned from my mom. The vacation is over when all the cash is spent.
You spend less when you are spending real money. After saving/investing what was a mortgage payment for 15 years, my wife and I can afford to make a big purchase or two. But something shifts on the inside when one writes a large check verses signing up for payments! I dare say we are MORE frugal now than then. We look for deals. We use coupons. We research stuff to death before spending large amounts. We have simply not felt the need to upgrade our lifestyle. When considering a purchase, we often comment on how long it took to save the amount we are considering spending. Such a mindset is a good check on how important the item really is to us.
Contentment is a great key to blessing. Greater stewardship increases contentment. At least it did for us. Somehow, this process has made us care LESS about newer things. Our mindset is, “Simple is better. No need to be too flashy. These shoes are still good. This phone still works. Nothing wrong with this older car!” Contentment really is “great gain,” spiritually, emotionally, and financially. (1 Tim 6:6) For me (Donna), staying away from social media (which includes watching T.V.) really helps me with contentment. I just don't know what the so called "in thing" is, so I don't miss it. Women can really struggle in this area. Hair and nails are expensive! Maturity/Wisdom will help you cut back, temporarily stop, or DIY these indulgences.
Save like crazy, but be generous too. Somewhere along this process, we shifted from being spenders to savers. The temporary happiness that we experienced when we bought something new was gradually superseded by the satisfaction of seeing our wealth grow. And save we did. Currently, being debt-free and working together allows us to save upwards of 30% of our household income. This began to increase as we brought more children into the house. Having something for them and being able to put more distance between them and this world became more important to us than stuff and things. Also, knowing that our giving to our local church and organizations we support would be consistent no matter what became much more important than shopping.
Keep setting goals. Paying off our home was a huge goal for us! But a key to living intentionally for our LORD is seeking His will in matters and setting our hearts toward those things. To us, that’s what goal-setting is about. We’ve hit a few key milestones over the last 15 years, but each year, we set new ones. There is much to do for Christ! Make them specific. Make them measurable. Give them a time limit. Write them down. But keep pressing towards the mark! (Php 3:14)
Invest. Put God’s money (and His gifts) to work! (Matt 25:14-30) I believe Christians should attempt to grow and maximize what Jesus has given us…to take dominion, to advance on the kingdom of darkness! One way we do this (not the only way!) is to grow our material wealth. Why? Because a believer will use such tools to advocate for and fund those things which our LORD loves: His Gospel, His church, Life, Marriage, the poor and oppressed, and other holy and righteous causes. We have learned much about the power of investing (in what is up to you!) and seeing God’s money work harder than we can.
Increased freedom was more than worth the sacrifice! Paying off our consumer (non-mortgage debt) in 2004 was a big deal for us. Finishing up all our debt in 2008 was even bigger. I remember how it felt: so incredibly liberating and freeing! Although many people have different views on whether to pay off a mortgage, we have never regretted this decision. Through the financial chaos of 2008-2009, ministry uncertainty and difficulties, new babies born, political turmoil, and the global COVID crisis, being debt-free gave us a tremendous sense of peace. It also freed us to bring Donna home and homeschool our children. All the sacrifice (working multiple jobs, nights, etc.) and living far beneath our means was worth it to get the house paid off. That “purchased peace” has been a great blessing to our entire family! There was definitely, definitely! sacrifice involved. I (Donna) had sleepless nights to help us have this freedom. Freedom is not free, it will always cost someone something.
Debt-freedom blessed our marriage and ministry! Having no payments has virtually eliminated money fights and struggles within our home. One less thing that can bring discord! Also, having no payments freed me in unexpected ways in our church pulpit. Instead of worrying about offerings, I concerned myself with “what thus sayeth the LORD.” Money pressure CAN impact the way a preacher preaches!
Thank God for His marvelous grace!
So now what?
We aren't legalistic about these things. Borrowing in and of itself is not sinful. But for those of you who want to take the debt-free trip, here are some suggestions:
Study debt and borrowing from God’s perspective. I recommend The Debt-Free Church by Berg and Burgess if you can find it. It’s a really good study on the topic. Our book is ok too.
Decide to honor Christ with money. He is LORD of all, including your resources.
Determine your level of intensity. How much do you want to be debt-free? This step is important because paying off debt is not easy. Dave Ramsey has the best motivational content here.
Know the state of your flocks and herds. (Prov 27:23) Assess your financial world. Use a monthly spending plan (budget). This will help you create the room you need between your income and outgo to save and pay stuff off!
Stop borrowing! Simple to understand…hard to do!
Save some basic cash reserves. Before debt-payoff, we recommend saving a tenth of your yearly gross household income (up to $100,000/year salary). We have found that a $1000 basic emergency fund isn’t enough for most people.
Have basic insurance in place: home, auto, life, health.
Kill debt. Start paying stuff off! Sell stuff! Work extra! Down grade the car! Stop eating out for awhile! Just get it done!
Raise your cash reserves. After COVID, I now recommend 6 months to a year's worth of salary. That’s really high. But this world is really crazy too!
Attack the mortgage with the room you have in your spending plan.
Invest. Allow the LORD to direct you in this area. For us, index funds have been a blessing.
Be generous!
There’s lots of room in here for individual family decisions. Plus, “life” will happen. No matter how neatly you diagram this out, it won’t go completely according to plan.
Nevertheless, persevere! It can be done!
The last 15 years went by incredibly fast. If the LORD tarries, time is going to go forward whether you pay off your debt or not. Why not get to “15 years from now” (or five!) in a better place?
You can do it!
