Debt Elimination

“Being provident providers, we must keep that most basic commandment, ‘Thou shalt not covet’(Exodus 20:17). Our world is fraught with feelings of entitlement. . . . If our family does not have everything the neighbors have, . . . we go into debt to buy things we can’t afford,and things we do not really need. Whenever we do this, we become poor temporally and spiritually”

Robert D. Hales, ”Becoming Provident Providers Temporally and Spiritually," Ensign, May 200

The first step, and the most important factor in debt elimination, is a firm commitment to reject debt. A debt-elimination calendar will simply not work if new debts continue to be added to the old. This change in attitude is not subtle or gradual but rather resembles the flip of a switch—it’s a resolute determination to make a clean break from the culturally accepted addiction to debt.

LUKE V. ERICKSON, Getting Out Of Debt -- For Good, Ensign July 2011

Third, avoid excessive debt. Necessary debt should be incurred only after careful, thoughtful prayer and after obtaining the best possible advice. We need the discipline to stay well within our ability to pay. Wisely we have been counseled to avoid debt as we would avoid the plague. President J. Reuben Clark fearlessly and repeatedly counseled members of the Church to take action.

L. Tom Perry, “IF YE ARE PREPARED YE SHALL NOT FEAR” General Conference, October 1995

Today I speak to all whose freedom to choose has been diminished by the effects of ill-advised choices of the past. I speak specifically of choices that have led to excessive debt and addictions to food, drugs, pornography, and other patterns of thought and action that diminish one’s sense of self-worth. All of these excesses affect us individually and undermine our family relationships. Of course some debt incurred for education, a modest home, or a basic automobile may be necessary to provide for a family. Unfortunately however, additional debt is incurred when we cannot control our wants and addictive impulses. And for both debt and addiction, the hopeful solution is the same—we must turn to the Lord and follow His commandments. We must want more than anything else to change our lives so that we can break the cycle of debt and our uncontrolled wants. I pray that in the next few minutes, and throughout this conference, you will be filled with hope in our Savior, Jesus Christ, and find hope in the doctrines of His restored gospel.

Robert D. Hales, Becoming Provident Providers Temporally and Spiritually, General Conference April 2009

To answer that question I ask, have you ever been hard-pressed financially? Have you ever been confronted with an unexpected expense, a mortgage coming due, with really no idea how to pay it?

Such an experience, however unpleasant, can be, in the eternal scheme of things, very, very useful. If you miss that lesson you may have to make it up before you are spiritually mature, like a course that was missed or a test that was failed.

That may be what the Lord had in mind when He said,

“It is easier for a camel to go through the eye of a needle, than for a rich man to enter into the kingdom of God.” (Matt. 19:24.)

Those who have faced a foreclosure know that one looks helplessly around, hoping for someone, anyone, to come to the rescue.

Boyd K. Packer, The Mediator, General Conference April 1977

The final maka-feke I wish to mention today is one which can crush our self-esteem, ruin relationships, and leave us in desperate circumstances. It is the maka-feke of excessive debt. It is a human tendency to want the things which will give us prominence and prestige. We live in a time when borrowing is easy. We can purchase almost anything we could ever want just by using a credit card or obtaining a loan. Extremely popular are home equity loans, where one can borrow an amount of money equal to the equity he has in his home. What we may not realize is that a home equity loan is equivalent to a second mortgage. The day of reckoning will come if we have continually lived beyond our means.

My brothers and sisters, avoid the philosophy that yesterday’s luxuries have become today’s necessities. They aren’t necessities unless we make them so. Many enter into long-term debt only to find that changes occur: people become ill or incapacitated, companies fail or downsize, jobs are lost, natural disasters befall us. For many reasons, payments on large amounts of debt can no longer be made. Our debt becomes as a Damocles sword hanging over our heads and threatening to destroy us.

I urge you to live within your means. One cannot spend more than one earns and remain solvent. I promise you that you will then be happier than you would be if you were constantly worrying about how to make the next payment on nonessential debt. In the Doctrine and Covenants we read: “Pay the debt thou hast contracted. … Release thyself from bondage.” 7

Thomas S. Monson, True to the Faith, General Conference April 2006

Next, I address the subject of debt. This is a day of borrowing, a day when multiple credit card offers arrive in our mailboxes each week. They generally offer a very low rate of interest which may apply for a short period of time; but what one usually doesn’t realize is that after that period has expired, the rates increase dramatically. I share with you a statement made by President J. Reuben Clark Jr., who many years ago was a member of the First Presidency. Its truth is timeless. Said he:

“It is a rule of our financial and economic life in all the world that interest is to be paid on borrowed money. …

“Interest never sleeps nor sickens nor dies; it never goes to the hospital; it works on Sundays and holidays; it never takes a vacation; it never visits nor travels; it takes no pleasure; it is never laid off work nor discharged from employment; it never works on reduced hours. … Once in debt, interest is your companion every minute of the day and night; you cannot shun it or slip away from it; you cannot dismiss it; it yields neither to entreaties, demands, or orders; and whenever you get in its way or cross its course or fail to meet its demands, it crushes you.”

Thomas S. Monson, Constant Truths for Changing Times, General Conference April 2005

That trust has blessed my life and the lives of my family. Years ago I heard President Ezra Taft Benson speak in a conference like this. He counseled us to do all we could to get out of debt and stay out. He mentioned mortgages on houses. He said that it might not be possible, but it would be best if we could pay off all our mortgage debt. 9

I turned to my wife after the meeting and asked, “Do you think there is any way we could do that?” At first we couldn’t. And then by evening I thought of a property we had acquired in another state. For years we had tried to sell it without success.

But because we trusted God and a few words from the midst of His servant’s message, we placed a phone call Monday morning to the man in San Francisco who had our property listed to sell. I had called him a few weeks before, and he had said then, “We haven’t had anyone show interest in your property for years.”

But on the Monday after conference, I heard an answer that to this day strengthens my trust in God and His servants.

The man on the phone said, “I am surprised by your call. A man came in today inquiring whether he could buy your property.” In amazement I asked, “How much did he offer to pay?” It was a few dollars more than the amount of our mortgage.

A person might say that was only a coincidence. But our mortgage was paid off. And our family still listens for any word in a prophet’s message that might be sent to tell what we should do to find the security and peace God wants for us.

Henry B. Eyring, Trust in God, Then Go and Do, General Conference October 2009

I wonder what kind of signals we are sending to our children when we purchase homes that are status symbols. We waste space and resources when we buy a larger home than is needed, a larger home than is practical for us to afford. We encumber ourselves with mortgages so large that they require the income of both husband and wife to make payments. Then we build consumer debt to the point of absorbing completely all of our disposable income, leaving no margin of safety for the rainy days that come into everyone’s life. Do not such signals from heads of households only feed the philosophy of “I want it now” in the lives of our children?

Some even have the mistaken belief that after turning their ears away from the counsel of the prophets to avoid unnecessary debt, they can then turn to their bishops to bail them out of their foolishness. About all the poor bishops can do is weep with them and help them move to more affordable housing and then counsel them on how they can cut their losses.

As I remember events in my life, I do not believe there was any degree of difference in the happiness that I enjoyed when my two brothers and I shared a single bedroom than when we had a home large enough that each of us enjoyed a bedroom. Let us teach our children the art of conservation and the elimination of waste.

L. Tom Perry, The Joy of Honest Labor, General Conference April 1986

Parents need to teach children very early that a solid financial base is a very important element in a happy home. We can do much with our young people to help them find satisfying, rewarding employment. We should encourage them to do well in their schoolwork and to learn to take advantage of opportunities that will help build a solid base for their future security. Children need to explore many employment opportunities when they begin high school. Then when they marry and establish a home, they will be well on their way to a vocation or a trade that will return an income that will be sufficient to meet their basic needs.

M. Russell Ballard, Providing for Our Needs, General Conference April 1981