Should I Stop Working for the Church and Get a Paying Job to Pay Off Our Debt?

“Dear Steve,

I have a $50,000 credit card debt for which the monthly payment is $1,000 at 9%. I receive a $24,000 military retirement and my wife makes $40,000 a year. I have $230,000 from early retirement in an annuity and we refinanced our mortgage two years ago for a 5% rate and the balance is $217,000. I am 58 and work for a church I founded for which I don’t yet receive a paycheck.

The credit card debt is killing us. My question is should I use my annuity to pay off the $50,000 or refinance to lower my payments? The house has been devalued to $225,000 so we don’t have much equity but were offered a 3.35% rate to refinance. My other alternative is to get a a job to supplement our income but the church takes up a lot of my time. What should I do to get out of or reduce our debt?

James”

Dear James,

Wow, that’s a loaded question on so many levels.

About the annuity, the basic issue is how much you are willing to sacrifice money you will need to live on when you are old and can’t make any money. If that doesn’t bother you then by all means rob the annuity and lose all the return you would have earned. But the problem with that decision is that it involves a morality issue. Is it moral to knowingly place yourself in a bad financial position in the future when you will be the most at risk of having to eat dog food to get by?

But then you always have the only legal option to deal with the unmanageable debt, bankruptcy. But is bankruptcy more or less moral? See Is Bankruptcy Sinful and Bad or Right and Moral? An Examination and What Does the Bible Say About Bankruptcy? Is Bankruptcy Scriptural?

And of course there is always the obvious choice of going to get a job with a salary to feed your debt. But this choice will rob you of the time you apparently feel you need to get the church going.

Do You Have a Question You'd Like Help With? Contact Debt Coach Damon Day. Click here to reach Damon.

I would suspect that the best answer to your situation is going to lie in two critical areas. The first area is going to be to educate yourself about all the ways to deal with debt. Once you’ve done this homework then praying on this will eventually give you some insight about what path is best for you to achieve your goals.

I sure have known a lot of flat broke pastors and preachers in my time. All of them deeply stressed about losing their churches and making ends meet.

I’d suggest you first read How to Get Out of Debt. The Honest and Unvarnished Truth and The Truth About The Success Rates, Failure Rates and Completion Rates of Credit Counseling, Debt Settlement, and Bankruptcy. They will give you a great overview of what we need to deal with to get you moving in the right direction.

Then use the free How to Get Out of Debt Calculator to review your options.

Once you’ve identified a company you want to work with, then follow my step-by-step guide on what you should look for and expect from a good debt relief company.

Please post your responses and follow-up messages to me on this in the comments section below.