Achieving Your Financial Potential demonstrates clearly how to gain control of finances through practical step-by-step instructions that are rooted in the Scriptures.
Though the Bible doesn't give advice on what the best mutual fund is, or how to play the stock market, Kays shows how it does contain the principles that, if properly applied, can lead to financial independence.
Highlighting passages from the Old and New Testaments, and presenting them together with graphs, easy-to-use worksheets, case studies involving real people, and helpful summaries of key points, Kays explains how to set goals, make budgets, pay off debts, reduce expenses, invest systematically, analyze insurance needs, plan for education, and minimize estate taxes.
Written for busy people who do not have time to read several books to acquire the financial information they need, Achieving Your Financial Potential is a book readers will find immediately valuable, and one they will wonder how they ever did without.
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About the Author
Scott Kays, CFP, is President and Founder of Kays Financial Advisory Corporation, which manages over fifty-five million dollars for 215 clients. He frequently hosts investment seminars for major organizations such as IBM, BellSouth, AT&T, Cox Enterprises, and Puritan/Churchill Chemical Company. An ordained minister and associate pastor for the past five years, and a graduate of the Georgia Institute of Technology and the College of Financial Planning in Denver, Kays lives in Atlanta with his wife and family.
Read an Excerpt
The Debt Trap
As I stated earlier, I do not believe the Bible teaches that borrowing money is a sin. However, rarely is it wisdom, either. Because excessive debt is one of the worst problems that people struggle with financially, getting out of debt and staying out of debt is a worthy and profitable goal.
Why do many Christian financial planners teach that it is a sin to borrow money? In Deuteronomy 28:12, as God is rehearsing the blessings that will come upon the Israelites for obeying Him, He states emphatically ". . . and you shall lend to many nations, but you shall not borrow." Lifting this verse out of its context, many Bible teachers interpret this to mean that it is a sin to borrow money for any reason from anyone. However, that is not at all what God is saying here. The context of the statement "but you shall not borrow" is not one of a commandment, but rather God is telling the Israelites that He will bless them so abundantly that they will not need to borrow money. Indeed, they were to have such an overflow of finances that they would be in a position to lend to others.
Just the fact that God is telling the Israelites that they will lend money to others makes it clear that it is not a sin to borrow money. By definition, if you are lending something to someone, then they are borrowing from you. If it were a sin to borrow, would God tell you to help that person sin? Of course not! However, God's perfect will is to reach a point where we do not need to borrow. This will take time, but by following the instructions in this book, you can get there.
Another passage of scripture people use toteach that debt is sin is Romans 13:8, which says to "Owe nothing to anyone except to love one another. . . ." As I have studied this scripture and others concerning debt, I am convinced that the Bible is not referring to debt as a transaction where one person borrows money from someone else in return for collateral and/or the promise to repay the money. Biblical debt, which the Bible says is wrong, is when you have promised to give something to someone in return for something they have done for you, and then you refuse to honor your word. You owe that person and should pay them what you owe. To not do so is sin.
For example, if I tell you that I will pay you $100 for typing several letters for me, once you have typed those letters, I owe you $100. That is a debt I owe, and God says I must pay it. If I do not pay this debt, I have sinned. I either made a promise to you that I was not in a position to keep from the beginning, or I am not keeping my word to you. Both are wrong. Proverbs 11:24 says "There is one who scatters, yet increases all the more, and there is one who withholds what is justly due [emphasis mine], but it results only in want." Debt that is sin is the withholding of what is justly due to someone. When you incur an obligation to another person, you should pay that obligation in a timely fashion.
This kind of debt extends beyond money. It can refer to a service you have promised to provide someone. It can be honor that is due an individual. Romans 13 refers specifically to the payment of taxes as an obligation for which we are responsible. Anything we owe someone, for which payment is due, is covered by this biblical concept. With regard to financial debt specifically, it is not a sin to borrow money for the purchase of an item. However, it is a sin not to make each payment as it comes due.
The Debt Trap
Even though it may not be a sin to carry debt, the reality of the matter is that debt is a downward spiral for most people. They see something they want, but do not have the money to pay cash for it, so they charge it. They justify the purchase by telling themselves that they can afford the monthly payment. Generally, most people do not realize how much money they are spending or borrowing because they do not keep an account of their expenditures. Their monthly payments grow larger and larger with the passage of time. They keep telling themselves that everything is okay since they can still afford the monthly payments. Credit card payments at 18 percent interest begin consuming an ever-higher percentage of their monthly cash flow. At some point, they begin to feel the emotional strain of their tight financial situation. Their fiscal problems begin to dominate their thinking. At this point, they often become irritable and less productive at work.
I have seen numerous marital problems arise at this stage in the debt cycle. The husband blames the wife for her overspending, forgetting about the set of new golf clubs he bought last month on credit. The exasperated wife angrily reminds the husband of his unnecessary expenditures. Their marriage suffers as they react to the pressure and blame each other for their financial woes. Communication shuts down, making impossible any logical discussion on how to resolve their situation.
Then it happens! The unexpected emergency occurs that puts them over the edge. Now they can no longer afford their monthly payments. They begin borrowing just to pay the interest on other debts. Few individuals or couples recover once they reach this point. Many file for bankruptcy. At this stage in the cycle, countless marriages are destroyed by the financial pressure. The real dilemma here, apart from the obvious problems associated with a poor credit record, is that if the individuals involved do not correct the habits that led to their debt problems in the first place, they are destined to repeat this cycle again in a few years.
If you find yourself being sucked down the debt trap, declare war on it and fight with everything you have to get out of debt. Seek professional counsel. There is an organization called the Consumer Credit Counseling Service that specializes in helping people get out of debt. They do not charge for their services and are an excellent resource for people with serious debt problems.
Perhaps you are in debt, but are not at the point of desperation. Nevertheless, as a financial professional I recommend that you strive to pay off your debts, except possibly the mortgage on your house (I will discuss this possible exception later). I believe that you will go further financially by living debt-free. Later in this book I give specific advice on how to accomplish this.
Debt is Bondage
Why should we strive to be free from debt? Proverbs 22:7 states "The rich rules over the poor, and the borrower becomes the lender's slave." In the first half of this verse we have the golden rule stated: "He who has the gold makes the rules." Ever since the beginning of time, rich people have, with few exceptions, ruled over poor people. Generally speaking, it is accurate to say that the rich determine how the game is to be played by everybody else.
The second half of this verse states an interesting truism. When somebody borrows money from another person or an institution, they have, in some form or fashion, made themselves subservient to the lender. For instance, many people are not aware that on virtually every bank loan there is a clause in the contract stating that the bank can call the loan at any time. This means that you can borrow money to start a business, make tremendous progress on your business plan, and then experience the trauma of the bank calling your loan, possibly destroying what you have taken years to build. Is this likely? No. But it is possible.
If you are forced to borrow money, the lender sets the terms on how the money will be repaid. The terms of the loan may contain very restrictive provisions regarding the types of activities that you or your company may engage in during the term of the loan. For whatever reasons, borrowing money can restrict your freedom based on the conditions the lender places on your obtaining the loan, and, in some sense, you become the lender's servant.
If you are not able to repay debt in a timely fashion, according to the terms of the loan, the noose becomes even tighter. At that point, the lender may have legal recourse against you. If the lender is willing to work with you to remedy the situation, then you must oblige whatever conditions the lender poses or suffer the legal consequences. You really do fall into slavery at that point.
Many friendships have been destroyed by one friend borrowing money from another friend, especially when the loan is not repaid on time. The lender feels taken advantage of if he does not receive his money back. He may try to exact a price from the borrower by laying on a guilt trip, which the borrower may either accept or come to resent. The lender often assumes the right to tell his friend what to do because of the debt owed, and every visible purchase may be scrutinized. Eventually the friendship is torn apart by the guilt, anger, and bitterness that develops.
Debt is an obligation that impedes your ability to obey God and to make choices with your money. Money being used to make loan payments is money for which you have no choice how to spend. Your financial freedom is hindered.
Many people want to give more money to the Church, but cannot because their monthly debt payments are too high. Sometimes a wife is forced into the workplace against her wishes in order to meet the monthly obligations of accumulated consumer debt. Yes, debt is a bondage from which you do well to get free.
One of the most foolish things you can do is to co-sign on a loan for someone else. When you do so, you are assuming the responsibility for repaying the debt if they do not. The tendency, especially if the borrower is a friend, is to assume they will pay back the loan, and your co-signing won't really mean anything. The opposite is actually true. The lender would not be requiring a co-signer for the loan if it felt the borrower was capable of repaying the loan on his or her own.
The Bible is very plain on the subject of co-signing, or becoming surety, for someone else's debts:
Proverbs 6:1 My son, if you have become surety for your neighbor, have given a pledge for a stranger,
2 if you have been snared with the words of your mouth, have been caught with the words of your mouth,
3 do this then, my son, and deliver yourself; since you have come into the hand of your neighbor, go, humble yourself, and importune your neighbor.
4 Do not give sleep to your eyes, nor slumber to your eyelids;
5 deliver yourself like a gazelle from the hunter's hand, and like a bird from the hand of the fowler.
Proverbs 11:15 He who is surety for a stranger will surely suffer for it, but he who hates going surety is safe.
Proverbs 17:18 A man lacking in sense pledges, and becomes surety in the presence of his neighbor.
If you are approached by a friend to co-sign a loan for him, be emphatic in saying "no!" Explain to him that even though you value his friendship, you have a personal policy of never co-signing a loan for others. I would rather lose a friend than become surety for his debt. It is foolish for you to come into financial bondage because of someone else's problems.
Being Debt-Free is a Testimony to God's Blessings
In Deuteronomy 28, God tells Israel the blessings that would come as a result of obeying Him. Note the following verses:
11 "And the Lord will make you abound in prosperity, in the offspring of your body and in the offspring of your beast and in the produce of your ground, in the land that the Lord swore to your fathers to give you."
12 "The Lord will open for you His good storehouse, the heavens, to give rain to your land in its season and to bless all the work of your hand; and you shall lend to many nations, but you shall not borrow."
13 "And the Lord shall make you the head and not the tail, and you shall only be above, and you shall not be underneath, if you will listen to the commandments of the Lord your God, which I charge you today, to observe them carefully . . ."
In verse 11, God tells the Israelites that He will make them abound in prosperity. Remember that Israel was primarily an agricultural society, so when God spoke of blessing them financially, He would often speak of blessing their land and their cattle. The first half of verse 12 further states that God will bless their labor so that it will produce much fruit. In this context, God then tells the Israelites that His blessing on them will be so great that they will no longer need to borrow money. Instead, they will have such a surplus of finances that they will actually lend to other nations.
Being debt-free is a testimony to God's blessings. God said He would bless His people to the point that they would not need to borrow money. When we experience that level of blessing, and others ask us how we manage to live above debt, it is an opportunity to witness about the blessings of God in our lives. When others around us are stressed out over financial problems, and we are at ease financially because we are free from the burden of debt, it is evidence that God's word is true and that God is indeed a good God.