Baby Steps…

When Matt and I were first praying about having a baby, we felt very much that it was the right time to start our family, but we didn’t know what to do about insurance. Neither of us were on insurance, and for me to get on insurance meant that we would need to wait a year to get pregnant before insurance would cover any of the costs. We prayed about it a great deal and both felt complete peace that the Lord was going to provide for us and that we could go ahead and get pregnant. So, from that time and then for the nine months after we got pregnant, we began to aggressively save for the birth of our baby. I called the hospital and priced the cost of a delivery. I called the doctor’s office and figured in that amount. By the time we gave birth, we had saved about $7,000 for the birth of our baby! That was so much money to us, but God’s grace was on us to really be purposeful and save. We felt ready and excited and so grateful that God had helped us to prepare for Noah’s birth.

Well, Noah made his dramatic entrance into the world after 24 hours of labor and then… an emergency c-section that was not at all a part of the plan. So, exhausted, in shock, and in total pain, we were all of a sudden faced with an additional $4,000.00 in medical bills! I have to be honest with you though, after the trauma that we had gone through, Matt and I were both just so thankful that Noah and I were both alive and healthy. The finances of it truly didn’t faze us because we both felt this overriding and really supernatural peace. The Bible talks in Philippians 4:7 about “the peace of God, which surpasses all understanding, will guard your hearts and minds through Christ Jesus.” We truly experienced that peace in that moment and concerning the finances of Noah’s birth.

But there we were with a new baby, having wiped out our savings and now $4,000 in debt. We could have questioned God in that moment. Why would He lead us into this? But in our hearts, we knew that He had led us. I remember looking at Matt in the hospital and just saying, “God led us here, so this is His bill. His grace is sufficient for this.” The amazing thing was, even with this enormous bill, I never for a second felt like we were in debt! I have thought about this a great deal and about how we were able to face what we owed for Noah’s birth and never take it into our hearts as debt. It’s amazing because, even as I think back, it is difficult for me to think of it as debt; yet that is what it was. I want to share with you today the steps that we took after Noah’s birth because within a year we had completely paid off what we owed for the c-section. I truly believe that if you will take these steps to heart, they could be the answer to your liberation from debt as well.

1) We had a promise. I can’t even begin to tell you how that anchored our hearts in the storm of Noah’s birth. God had said we would never lack and it just gave us such peace that He was going to provide for us and take care of us. That promise was the hope that anchored our purpose as we worked for the next year to pay off what we owed. I want to challenge you that you need a promise for your debt. If you don’t have one in your heart, let me give you one…

Philippians 4:19 – “And my God shall supply all your need according to His riches in glory by Christ Jesus.”
Matthew 7:8 – “For everyone who asks receives, he who seeks finds, and to him who knocks it will be opened.”
Matthew 7:11 – “If you then, being evil know how to give good gifts to your children, how much more will your Father who is in heaven give good things to those who ask Him.”
Psalms 37:25 – “I have never seen the righteous forsaken, nor his descendants begging for bread.”
Psalms 97:5&10 – “The mountains melt like wax at the presence of the Lord. He preserves the souls of His saints; He delivers them out of the hand of the wicked.”

Maybe you need some “mountain melting” when it comes to your debt. You have to get a promise in your heart because it will anchor you when it is difficult to keep going. His Word is powerful and it will give hope and bring His power to your situation, and trust me you NEED His power! His strength is so much better than yours when it comes to mountain climbing.

2) The next thing we did was we got our debt into the best possible place to pay as little interest as possible so that we could pay it off as quickly as possible. Many of you have debt that is on credit cards at horrible percentage rates! If you haven’t called your credit card company to ask for a lower rate, you must do it today! Otherwise you are just throwing your money away. Yes you owe them money, but your interest rate is completely negotiable. Just keep asking for a manager until you get to someone who has the authority to adjust your rate. You have absolutely nothing to lose here. They are never going to increase your rate for you asking for a lower one, and you may just find favor and get your interest rate reduced and end up paying a lot less in the long term! Now, there is so much more to managing credit card debt (like transferring balances, which card to pay first, whether to consolidate your debt and a lot more) and I am going to do an entire blog on the topic later this week, but for today I want you to think about how you can get your debt into the best possible place. Matt and I negotiated with the hospital. We got a huge discount for paying the entire bill up front before we left the hospital. Our bill would have been almost DOUBLE if we had set up a payment plan with the hospital instead of setting up a payment plan with ourselves! We then transferred the debt to a 0% interest credit card (I realize these are rare these days) so that we paid no interest on what we owed. There may not be a 0% option for you in your debt, but I guarantee you, if you will begin to actively manage your debt and your interest rate, there is always a way to reduce your interest!

3) We determined what the total amount of debt was that we were facing. Some of you have no idea what your total debt even is! You need to sit down with every debt, credit card, outstanding bill (not those in your budget, so not your regular monthly bills) and figure out the total that you are facing to get out of debt. Until this number becomes a fixed number that you can work toward reducing, your debt will continue to be unassailable to you and you will just continue to make more debt. If you see the total debt in front of you and have a fixed number, you are much less likely to just keep throwing more debt on the pile. Furthermore, if you don’t know the total that you are facing then you will have a very hard time doing the next step.

4) We set a time line and a goal for completely paying off our debt. We took the total amount that we owed, which was $4000 (and some change 🙂 ) and we set a goal of one year (because for us, that was when our 0% interest rate would expire) and then divided our total debt by 12 (which was about $334 a month) and then we worked that amount into our budget. So every month we paid $334 towards our debt. It wasn’t easy. We stopped eating out (at all), we cut out our clothing budget, we scaled back our grocery budget and just cut out as much as we could find to cut and within a year we were completely out of debt! If you have interest on your debt you will need to take that into account in your monthly payments, but it is so important to set a time line so that your debt doesn’t just drag on forever before you with no end in sight. A time line will give you a goal and an end and it will help you to strategize a payment plan that will actually bring you to the point of freedom

It really is amazing what you can accomplish when you have a promise from God to sustain you, a purpose for what you are doing, and a plan to walk it out! What was even more amazing in our story was that it actually took us less than a year to get out of debt! Because as we were walking out our plan, God also added His incredible provision and delightful surprises in terms of random gifts of money in the mail, and even more side jobs for Matt than usual. Yes, we walked with wisdom and restraint, but it was His favor and grace all over us that truly makes that year shine in my memories. That is why it is hard to think back and think of our year after Noah’s birth as “being in debt”… it’s more like we were “in a position for a miracle” and boy did we get them. I really believe as you take these steps you are going to see the hand of God in your life, and you are also going to find your feet when it comes to your finances. God is for you and whether He helps you climb the mountain of debt, or He just melts it before you, this journey doesn’t have to be heavy and hard. In fact, it might just turn out to be a testimony that you build your financial walk on for the rest of your life.

“Bless the Lord, O my soul, and forget not all His benefits;
who forgives all your iniquities,
who heals all your diseases,
who redeems your life from destruction,
who crowns you with loving kindness and tender mercies,
who satisfies your mouth with good things, so that your youth is renewed like the eagle’s…
He has not dealt with us according to our sins,
Nor punished us according to our iniquities.
For as the heavens are high above the earth, so great is His mercy towards us.”
Psalm 103:2-5 &10-11