The Christian and Installment Buying
by
Dallas M. Roark
NEARLY everyone buys on the installment plan today. From 1910, when about 10 per cent of the sales in this country were made on credit, we have rocketed to the two billion dollars a year mark in credit buying today-approximately one-third of all retail sales.
And why not? For a dollar down and a few more a month, you can buy anything from a boat to a book. With the all-powerful credit card you can travel from coast to coast without paying a penny--at least for the moment. Vacations, contact lenses, foreign cars-all may be had for so much down and so much every payday.
Installment buying is a big business today and a part of the economic triangle of mass production, mass consumption and mass financing. The National Retail Credit Association estimates that most department and specialty stores do from 50 to 85 per cent of their business on credit. Approximately 95 per cent of the people in this country use credit in one form or another while 85 per cent of home utilities such as radios, vacuum cleaners, refrigerators and furniture are paid for by the month. Greatest users of this type of purchasing are young people from eighteen to fortyfive who draw a yearly income of $3,000 to $7,500.
What should the Christian's attitude be toward this tremendously popular convenience? When Paul wrote "Owe no man anything, but to love one another ... " did he set forth a principle concerning financial indebtedness? Is there a moral and ethical problem here for the Christian? Does this Scripture condemn installment buying? If it does, what do we do about some of the daily needs which would require years of saving, things such as a car and a home, before we could pay cash?
Before trying to find the answers, one thing should be recognized. There are dangers both in using installment credit and in not using it. A young preacher found that installment buying was easy. Golf clubs, roller-skates 'swimming gear and a host of other unnecessary items soon proved too great a burden for his low salary. He moved to another field leaving behind a series of debts running over a thousand dollars.
Take a look at Fred, a talented mechanic with a large family in Chicago. His love for big and expensive new cars forced him to neglect his family as he struggled to meet large monthly payments.
On the other hand, other incidents point up the folly of not using credit. Gordon and Marge, married in 1920, adopted a cash-and-carry policy for their business affairs with the exception of their farm which they paid for
by installments. Now Marge still carries water for household use, and Gordon still carries in the old cold portable washtub each Saturday night. Installment buying would have changed this.
Stan and Dorothy moved from the deep South and found work in industrial Chicago prior to Wodd War 2. Dorothy encouraged Stan to save the monthly rent by buying a house. Not wanting to obligate his future Stan plodded along week after week paying his rent and building up his savings. At last he paid cash for his little home, but it could have been a mansion if he had put to use the wasted rent money of sixteen years.
WHAT do Christians say and do about this business of installment buying? One pastor, who I expected would be flatly against indebtedness, said, "For the Christian, indebtedness for something you need is all right, but many have themselves in debt needlessly. If it glorifies the Lord, and is needed, there is no wrong. But for luxury? No!"
A young second-term missionary said, "I try to stay free from debt, but when I return to the field, I will have to buy a car. I have no money but will pay the easy ,way because it is necessary for the work of the Lord." She cited a young couple who opposed indebtedness but, in order to put a roof on a much needed building before the rains came, had to go into debt to protect their work.
A mission board secretary said, "I personally avoid installment buying and only infrequently incur other types of debt, but I'm not prepared to make any statement as to principles."
On the other hand, several put forth this principle about indebtedness and installment buying: "If you meet your monthly agreement according to plan, you are not in debt. But if you fail to meet your agreement, then you become a debtor."
A professor said, "Regarding a Christian's buying on the installment plan, none of us would have very much if we hadn't bought it on the installment method. I do not believe this is going into debt unless a person fails to make his payments. I try to work this out accordingly before I ever get involved in buying an article."
A Christian foreman put it this way: "I believe that if I purchase a home and pay for it by the month, meanwhile paying interest on the money, I do not owe anything as long as I live up to the agreement I make with the bank. If at any time I fail to keep my ageement, they are free to take over the home, cancel the debt and leave me debt free. I believe that I can buy on the installment plan and live according to the Scripture as long as I meet my payments."
The price of some items leaves little choice about the method of payment that is, if we decide we need them. Very few people can plunk down three thousand dollars for a car or twenty thousand for a home. Almost everyone is willing to pay monthly payments on an investment as over against paying rent, which is like pouring water on the ground.
One pastor said, "Frankly, I believe that installment buying is one of the greatest curses of our economy. I personally have avoided the system. But I would be more favorable to buying a house on time than anything else. I consider that more of an investment. A home is a form of security in the event of the death of the breadwinner, but I believe that being in debt is not a good testimony and is not sound from the financial angle."
Another pastor wrote, "The car and the home are indispensable items for life today. Rentals are impractical, unwise and poor stewardship. I would rather plunge into debt with the prospect of investment and ultimate return, for both a car and a home, than to let my work suffer and spend money unwisely."
I TALKED with the local banker about installment buying and asked how he felt about the present trend.
"Installment buying is good as long it as you don't overtax yourself," he began. "It is savings in reverse. We estimate that approximately 20 to 25 per cent of a man's annual salary is spent in installment buying."
I then asked, "Do you think installment buying is being overdone?"
"Yes," he replied, "to a certain degree. Some people can't resist easy credit. Perhaps 10 to 15 per cent of the people who are encouraged to use credit and installment buying should not be. Installment buying is overdone to at the point of, luxuries. It is at this
point that evils accrue."
"Does the easy credit and purchase power have any effect on the attitudes of young people?" I asked.
"Yes," he said, "often a young person out of high school comes in wanting money to buy a new car. He has no credit rating, collateral or capital, but wonders why we can't loan him the money. Credit buying tends to give young people a distorted view of the value of the dollar."
Does the Bible say anything about the problem? What about Paul's declaration "Owe no man anything" (Rom. 13: 8) ?
'In Lange's commentary the author suggests that the verse is related to the previous verses emphasizing the duty of Christians to give tribute, custom, fear and honor to whom it is due. Owe no man anything, that is, in the way of these things. It can be applied. to debt, the author says, only by isolation from the context or secondarily so. .
The New Bible Commentary suggests much the same. Paul is dealing with the fundamental principle of love and our debt of love. Fulfill your debt of love and owe no man this debt, he seems to say. ,
On the other hand, William Griffith Thomas, in his commentary on Romans, says, "The Christian is not to incur anything which he is unable to pay, and knows that he is unable when it is incurred. He ought to be able to render back what is rightfully claimed from him, If he should have to borrow anything and the repayment is required, he ought to be able to meet this liability,"*
Albert Barnes relates the passage to the previous verses but says that the transition is natural to debts in general. He points out that men should learn to be industrious and frugal, and attempt to live soberly, avoiding the luxuries of life. which often lead to debt.
There is general counsel elsewhere in the Bible. We are told to "provide things honest in the sight of all men" (Rom. 12: 17). Paul exhorts the Thessalonians, "Work with your own hands . . . that ye may walk honestly toward them that are without, and that ye may have lack of nothing" (1 Thess. 4: 11-12). From his prison cell Paul wrote "I have learned, in whatsoever state I am, therewith to be content" (Phil 4:11), Further, we are admonished, "And having food and raiment let us be therewith content" (I Tim. 6: 8). The book of Hebrews urges us to have our minds free from "covetousness, and be content with such things as ye have" (Heb. 13: 5).
The basic principle in Scripture seems to be that the Christian is to earn his own way, meet his obligations so that his testimony is beyond reproach and limit his wants to what he can reasonably afford. Our treasure is to be in heaven where it is eternal rather than on earth where it is transient and corruptible .
HERE are a few basic principles about installment buying for the Christian to remember:
1. Use the installment plan only when necessary and justified. Many articles such as TV's, outboard motors, new cars, movie equipment, fishing and hunting equipment and other luxury items are bought on installment buying when they are not really needed. Often the biggest problem is the ability to say "no" to yourself.
2. Buy only what you need and can afford to pay for on time. Sometimes articles such as sewing machines, deepfreezers and washing machines tend to pay for themselves by saving in the cost of food and clothing or in saving time. If we ask ourselves, "Do we really need this item?" often the answer will be "No!"
3. Buy on credit only when you are in position to meet payments with a reasonable margin. You must ask yourself, "Will I have difficulty meeting current expenditures such as rent, insurance, utilities, living costs? Will my present earnings be enough to meet the extra outlay needed?"
4. Finally meet payments promptly.
A Christian can do great damage to his testimony by tardy payments. Many faults will be overlooked but not this one. If you are unable to meet a payment for any reason, go to your creditor and make arrangements before the time of the payment. If he does not know your circumstances, his only recourse is to take action.
So, installment buying by the Christian, it would seem, is justified on high cost, investment type items which are not luxuries. As long as the Christian doesn't use it as a device for living beyond his means, and as long as he meets payments regularly and on time, his testimony is not jeopardized. But let him get entangled in a web of long payments, and stiff interest for a house full of temporal conveniences, and he has crossed over into dangerous ground. END
* St. Paul's Epistle to the Romans by W. H. Griffith Thomas, Eerdmans
(This article appeared in the September, 1960 Moody Monthly)