Consumer Debt – how we annihilate it (Part 1)

I love the old story that someone’s dad used to flip burgers part time to pay for college out of pocket while they attended. It sounds to me more like education in pre-Gulf War Iraq (free at all levels) than the US a generation or so ago. Every graduating class gets more debt piled on to the point that it’s normalized to have student debt as a rite of passage. If you don’t have any – a normal person might assume that you don’t have a college education or your parents paid for you – unless you are over 6’10” (then they think you should be playing for the 6ers).

It’s not just education or mortgages, which are still considered “good debt” since they are an investment that normally gains in worth or earning potential. Consumer debt, or revolving debt, has less of a noble connotation.  According to Nerdwalletthe average household in the US with a credit card has over $16,000 of credit card debt. If you include households with no credit card debt, we still average over $7,500. That’s over $918.5 billion.

For many people, credit card debt serves as a sign of financial mismanagement, economic emergencies beyond one’s means, bad spending habits, predatory lending, or the open wounds from another kind of financial crisis. Shame comes along with almost any reason – most people feel as though debt cripples them, or hangs heavy around their neck. Many people I talk to can only pay their minimum balance or just a little over, leaving them with thousands of dollars collecting interest each months at rates from 0% (temporarily) up to 29.99% if you miss a payment.

I first heard about combining debt in the late 90s at Circle of Hope when people like Will O’Brien, Randy Nyce, and Trevor Day would consider our financial power when form community. They were using some economic theory and theology that I trace back to Ched Myers’ work on Sabbath Economics – these two books are a good start. It took years to get an idea small enough to try, and then a few years to find someone to organize it -it ended up being me. Even though a recent internet IQ test put me just below genius at 137, I have few math skills. In Part 1, I’ll explore the concepts that we distilled enough to try with brave “astronauts” coming together in 2010 with five people and $22k of credit card debt, and then another group in 2013 with $26k that is almost done. When I post Part 2 next week, I’ll give specifics on our strategy as well as how to get involved. 

Handle your debt like a group, rather than an individual

Romans 13 inspired us to want to “let no debt remain outstanding, except the continuing debt to love one another.” Our shame isolates us. Our attempts to save face can isolate us. Turning to the corporation rather than the Body in distress isolates us. Forming a Debt Annihilation Group takes a lot of work up front and keeping disciples, and it happens in common – even considering the debt common.

Get coaching, and have financial transparency

Our coaches get trained by Everence to help with budgeting and by our team members on how to have healthy conflict, be supportive, and keep encouraging group members. Telling the whole truth about our money habits flies in the face of what we’ve been taught and undermines the Powers.

Change your mind about money

We have been indoctrinated to Spend, Save (if you can), and Share (if you’ve got extra). In our coaches’ training, we learn a new paradigm of Share (give from your best), Save (plan for more than the moment), and Spend. If you don’t have money to share and save, chances are your expenses are inflated and you need some help learning how to cook at home, chill with the bars/coffee shops (even the ones owned by my friends!), and honing down paid entertainment to name a few. Heal your mind.

Make a plan and stick to it

Even the best laid plans can be laid to waste by not following through. Even when it’s Christmas. Even when your car breaks. Even when you car dies. We have so many resources as a community to reduce the cost of these things – plus your cell leader can help you in crisis. One meeting we passed the hat so one group member could get a Transpass and had one less reason to borrow from the corporation again.

Enjoy freedom

Becoming debt free calls for celebration. Tell your story. Enjoy the proverbial monkey being off your back by remembering and sleep better. Be generous.

Feel free to add your thoughts or stories to this post in the comments, or questions you might have about the concepts and philosophy. Next week we’ll have more practical application and opportunities to be involved in the third round we’re getting going by the end of the year. 

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