Don't go deeper into debt this Christmas

Each year around four million of us go into debt just to pay for Christmas. The average British family spends more than £500 on gifts. For many that means spending beyond our means on credit cards. It’s all too easy. Robin Stamp is a financial adviser, who learned the hard way how to halt the slide into debt. At one point, he used his gold cards to buy a pub, and ended up owing tens of thousands of pounds.

As a child of the 60s, my formative years were spent just when credit cards and consumer credit was being rooted into the “British way of life”. By the mid 80s I, like many, was enjoying the benefits of “free shares” and stellar rises in property prices – a marvellous time when it felt like the roads were paved with gold.

And even if you did find your self short then your obliging bank manager or flexible friend was there to help! What could ever go wrong? As I dashed into business and the future with “gold” in my hands I was sure the answer was nothing!

Funny thing really, but it was only later that I realised just how well I had fallen for one of the greatest marketing pitches of all – the offer of a “Gold Card” (or two as it happens). And did I fall for it… If ever there was a status symbol that pampers the pride and just begs to be flashed at every opportunity, it’s the Gold Card. Prestige and cheap credit, what could be wrong with that?

As for me, I was no fool (as I then thought). I played my cards well, moving money from one 0% deal to the next, chasing up ever higher credit limits like trophies. At one point I remember saying with some pride that I had credit card facilities totalling more than £120,000! Thankfully I never went up to the limit but I put down the deposit on a pub in Exmoor by maxing out two gold cards. And amazingly, I wasn’t worried by it. After all, buy now, pay later was the norm. Ignorance was bliss and the future was golden.

Well, as they always do, the chickens came home to roost. The 0% deals dried up and the assumed great income of the future failed to materialise. Instead, as our earnings rose we just upped our standard of living to suit. Finally I (and more importantly my wife) realised the debts were dragging us down (and not just financially). In the end the only real way out was to sell the house, clear the card debts and start again with a cheaper property!

The problem was, that while we may have paid off the debts, nothing had really changed. Old habits die hard and I still saw credit cards as friends: they allowed us to live free from the worries of nasty limitations like actual income. So, surprise, surprise, we continued to use the cards and built up debts all over again.

I guess in a way, it’s just like drugs or drink – it’s not until you look back that you realise how easy it was to get out of control and swept along with the rest of the crowd, like lemmings on their way to their final holiday destination.

Thankfully for us, after some time and a little wisdom from God’s good book, we did start to nibble away at the debts, but still couldn’t shake them off completely.

Then we met John Kirkby. He’s the founder of CAP (Christians Against Poverty). He was speaking at the Association of Christian Financial Advisers’ conference, where he spoke of his own journey beyond the brink – and back.

After that, we decided we wanted to help other people who were falling into the same financial trap. We started a money ministry within our own church based around the CAP Money course.

While our aim was to help others, by doing the course we found ourselves looking for the first time at our own income. We set a budget (within our means), stopped using the card and actually started saving. Since then our own lives have been transformed (along with many others) by adopting the CAP basics: budgeting, kicking the credit card habit and using cash!

It is a sad fact that debt is a problem for a huge number of individuals – and indeed nations – fuelled by easy credit and driven by a culture that shouts ‘Why wait? Buy now – pay (or maybe, pray?) later.’ And it’s especially hard at Christmas when the temptation is to spend beyond our means. The average UK family spends between £530 and £682 on gifts. Many admit to feeling pressurised to buy gifts we can’t afford. Generosity is a good thing – but not with borrowed money.

The Bible has much to say about financial issues, including borrowing lending, budgeting and being a good steward, all of which have a bearing on the above. Proverbs 25:28 says that a man who lacks self control (spends without measure) is like a city whose walls are broken down. Once the walls come down the city is open to attack from an enemy and will ultimately fall.

In Matthew 7:24 Jesus says: "Everyone who hears these words of mine and puts them into practice is like a wise man who built his house on the rock.”

Knowing what you have as an income and budgeting to live within that income, while still being generous to others and saving for the rainy day, are foundational to our lives. They will lead to freedom and long-term security.

The great thing is that we don’t have to follow the pack, it’s possible to live in freedom from debt, and if that seems just a dream – help is available.

Jeremiah 29:11 says: “For I know the plans I have for you," declares the LORD, "plans to prosper you and not to harm you, plans to give you hope and a future.”

Breaking the debt trap

Just paying off our debts – tough as that may be – isn’t the answer. Unless clearing out debts is accompanied by a change in attitude the debts will simply return.

If we are to avoid falling into the debt trap, then we need to “take stock” – assess our true financial situation, and live within our means, while also making sure to be generous and lay aside funds for the future.

While there may be no shame in falling into the debt trap – there certainly is pain. So take the first steps and make a budget, and ask for help from a professional financial advisor or debt relief charity.

God does have great plans for us but we do need make sure that our futures are built on good foundations – and not sand.



CAP (Christians Against Poverty) can be contacted on 01274 760720.

Robin Stamp is a Chartered & Certified Financial Planner and Later Life Accredited Advisor for Alpha Financial Consultants based in Somerset 01984 633757. He’s also a member of ACFA, the Association of Christian Financial Advisers.

ACFA is the UK network of Christian financial advisers and related professionals. It aims to be the voice of Christian financial advice and champions best practice in the UK. The ACFA website offers links to Christian financial advisers across the UK www.christianfinancialadvisers.org.uk