Establishing Your View On Debt
We’re living in a culture where instant gratification is expected, but business owners often find that accumulating significant debt can be detrimental. Whether it is declining prices, dropping value, rising interest rates, or a sharp drop in sales, you should always protect yourself from the worst case scenario. As a Christian leader, that means pausing, planning, and praying before borrowing money. There is no Biblical ban on debt; however, we are clearly and frequently warned of its risks through Scripture.
From a business perspective, you should remember that debt isn’t a crutch for ongoing operating problems or unprofitability. Rather, you should focus on paying off debt to improve margins, earning the right to later employ a modest amount of debt for funding strategic growth projects. Repeating the cycle every few years will help you stay within a comfortable debt-to-equity range. Some of the most successful firms have followed this model, borrowing at favorable terms and paying it down rapidly, thereby creating the financial capacity to do it again and further enhancing their growth.
Being a Good Steward
Debt is not something that should be entered into hastily. You should think strategically about how to protect yourself from the risks outlined in Scripture. Still, Christians sometimes find themselves in danger of defaulting on their obligations. In these cases, we must think proactively, establishing a plan to retain long-term stewardship and pay back our creditors. Regardless of your situation, it is wise to remember that debt carries risks and comes with a great deal of responsibility.
Support at C12
Debt is a common topic in C12 Groups. Members learn from their Chairs and each other how to grow their businesses while being responsible stewards. If you would like to learn more about becoming a part of C12, find a group near you today.