Drowning in Debt

Has debt ever felt like an endless ocean or a towering tsunami? Many people today are struggling to keep their heads above water financially and feel like they are drowning in debt.

Debt can affect your mental health and take a toll on your relationships. “In addition to the impact to your mental health, stress and worry over debt can also adversely affect your physical health and can lead to anxiety, ulcers, heart attacks, high blood pressure and depression. The deeper you get into debt, the more likely it is that your health will be impacted” (Kathryn Pomroy, “What Are the Long-Term Effects of Debt?”).

The burden of debt and the number of people affected are rising.

“The average debt in America is $104,215 across mortgages, auto loans, student loans, and credit cards,” said Jennifer Streaks (Businessinsider.com).

According to the Financial Times, nearly 3 million people in the United Kingdom fell into financial difficulty last year, and more than 20 million in Britain are now living in vulnerable circumstances.

In the U.S., four out of five are in debt (Chris MacDonald, “Drowning in Debt: The Hidden Tsunami Engulfing American Households”).

No matter what country you live in—if you are in debt, you are not alone. People everywhere have their stories of drowning in debt.

Debt stories

One woman, who asked to be anonymous, told about her traumatic experiences at age 24. She was without health insurance and had a lot of medical debt from surgery two years earlier.

Then she broke her jaw in three places. “I didn’t even have the money to pay for a doctor’s appointment to tell me how to fix my jaw. I did have to beg others for the first payment for the surgery to fix my jaw.

“When the bills started coming in from that, from the previous surgery, I was overwhelmed, crushed, and scared.”

She added: “My debt was partly not knowing how to budget and live and partly because of circumstances outside of my control, such as my health.” (More about her story later.)

Expert debt story

Even today’s personal finance experts have their own debt stories.

Dave Ramsey, whose name is now synonymous with getting out of debt, shares his story in his book The Total Money Makeover:

“It seemed every month I sat at that same table with the same worries, fears, and problems. I had too much debt, too little savings, and no sense of control over my life. No matter how hard I worked, it seemed I couldn’t win. I was to forever be a slave to some banker, to the government, and to the ‘needs’ of my family. When Sharon and I ‘talked’ about money, we ended up in a fight, leaving her feeling afraid and me feeling inadequate. The next car purchase, the next house, the kids’ college—our entire future seemed out of reach” (pp. 1-2).

Expert tips for getting your head above water

Dave Ramsey, like other experts, has turned his personal experience around and now teaches others principles for getting out of debt.

Here are some of the basic steps his organization recommends:

1. Get on a budget.

2. Cut back on the extras.

3. Pause all investing.

4. Don’t take on any new debt.

5. Increase your income.

6. Start working the debt snowball.

7. Stop the comparison trap.

8. Start (or keep) working the Baby Steps.

(“What to Do If You’re Drowning in Debt.”)

Much of the commonsense advice available today rests on biblical principles.

Biblical warnings and advice about debt

The Bible advises us to avoid borrowing, but if we do borrow, we must repay any money, and if we borrow something else, we must take care of it and make it good if it is damaged (Psalm 37:21; Exodus 22:14).

The Proverbs even warn about the dangers of cosigning on a loan (Proverbs 22:26-27). All this is summed up in the proverb: “The rich rules over the poor, and the borrower is servant to the lender” (verse 7).

Paul expressed this ideal along with a deeper spiritual message:

“Owe no one anything except to love one another, for he who loves another has fulfilled the law” (Romans 13:8).

The dangers of credit card debt

Credit cards can be one of the most expensive ways to borrow money. Even as other interest rates come down, credit card rates can remain stubbornly high.

As each credit card or other debt is paid off, the burden and anxiety lighten. Paying off the last debt is an event to celebrate! In November 2024 CNBC reported, “Lower-income households, who had to stretch to cover price increases, have been hit especially hard after the Federal Reserve’s string of 11 interest rate hikes lifted the average credit card rate to more than 20%—near an all-time high.

“Even as the Fed lowers its benchmark, the average credit card rate has barely budged.”

This is a real problem as average credit card balances in the U.S. have increased to $6,329.

Experts advise credit card debtors to stop charging anything new and to pay off the credit card balances as soon as possible.

Jade Warshaw, author of Money’s Not a Math Problem, advises the debt snowball method: listing debts from smallest to largest and attacking the smallest first (while paying the minimum payments on all the rest).

“When it comes to paying off debt, money is mostly about your mindset, not math. Once you get that first debt behind you, you’ll be on fire and ready to knock out the next debt!”

If you are more motivated by the math, however, the debt avalanche method suggests paying off the debt with the highest interest rate first.

Either way, experts encourage debtors to stick with it and not give up.

Mitchell Hockenbury, a certified financial planner in Kansas City, Missouri, said, “The worst thing that I see people do is throw their hands up in the air and think, ‘Well, I’m already in debt. What’s a little bit more?’ and they go out and spend money on dinner or buy something that temporarily makes them feel better” (as quoted in “4 Things Not to Do When You’re Drowning in Debt”).

Budgeting basics

A budget is just a plan, and without a plan, it’s unlikely you can get out of debt and achieve your financial and life goals.

A budget involves writing down your income, as well as how you plan to spend it by categories, such as housing, utilities, food, clothing, transportation, insurance, health care, saving, giving, debt repayment, entertainment, etc.

A budget also requires some method of keeping track of what you actually spend. Reviewing this information leads to decisions—sometimes hard ones requiring you to say no or make trade-offs—to make sure your spending doesn’t exceed your income.

One resource for setting up a simple budget is our online article “The Bible, Budgeting and You” with its “Sample Outline Budget Reflecting Biblical Principles.”

Getting to your goals

Several of the people I surveyed for this article shared stories of the despair of debt being conquered by prayer, priorities, perseverance and the kindness of other people. Several credited putting God first and faithful budgeting with helping them escape the debt trap.

Here’s the rest of the story from the anonymous young woman with the medical debt.

“I clearly remember getting down on my knees, crying, and telling God that I didn’t know what to do, but I would not rob Him by not paying tithes, and I would do my best to have the faith to come out of this very difficult trial. It is still one of my most vivid and real prayers.

“The next day in the mail, two checks that covered my medical debt showed up . . . I have no doubt that He heard my prayer.”

Tithing is the biblical practice of giving 10 percent of our increase to God, and financial advisers like Ramsey Solutions say not to stop tithing even while paying down debt. “The Bible never mentions anything about hitting the pause button on tithing. And in Malachi 3:10, God actually promises to bless us if we faithfully tithe” (RamseySolutions.com).

Another person I interviewed, Lynda, gave this personal experience and advice:

“I always felt like debts would take ‘forever’ to pay off until I [learned to] set an amount, pay it regularly without fail and celebrate the little victories of the decreasing balance. Then [once it was paid off, I continued to] set aside that same amount in savings for the next rainy day.”

Lynda concluded with two pieces of advice: “Thou shalt make and abide by a budget!” and, “Live beneath your means.”

All this hard work and self-discipline pays off. As each credit card or other debt is paid off, the burden and anxiety lighten. Paying off the last debt is an event to celebrate! (Frugally, of course!)

Then you can redirect the money in your budget that was dedicated to paying off debt toward saving for emergencies, for your children’s education, for retirement and for other long-term goals.

There is a way out. The effort will be worth it!

To study more about this important topic, see our online articles “Dealing With Debt,” “Christian Budget” and “Teach Little Kids About Money.”