Dear Chuck,

Our adult daughter is single and working in retail. She just revealed that she has credit card and after-pay debt issues. She has asked us for help. Should we bail her out?

Daughter in Debt 

Dear Daughter in Debt, 

In short, no. Obviously, I don’t have all the facts, but helping her to work her way out of this without paying the bills for her would be my recommendation. 

We learn from our mistakes, and this is an opportunity for a great education. Of course, you don’t want to be unkind, so there are constructive ways you can help. Let’s look at the big-picture problem before getting to the specifics for your daughter. 

Americans Have a Problem with Debt

A recent Kobeissi Letter  revealed the following:

• Total credit card debt officially crossed $1 trillion for the first time in history. (Not good)
• Average interest rates hit a record high of 25%. (Ridiculous) 
• Average American families hold a record $10,000 in credit card debt. (Way too much) 
• 40% of Americans have more credit card debt than savings. (40%!)
• Household debt hit a record $17.1 trillion. (Mortgage and consumer debt combined for all people in a home.)

The bottom line: far too many Americans are spending more than they can afford. This is a serious economic challenge that must be addressed! 

Money but No Margin

Americans overspend because they have no margin. They have not learned or applied Biblical financial principles. As a result, they do not have adequate emergency or regular savings accounts. So they use credit cards to cover budget gaps. Many have unforeseen medical expenses or poor spending habits. Some try to keep up with the “Joneses” (who may also be buried in debt) or presume on future income without considering a layoff or lost income, while others fall for get-rich-quick schemes. Persistent inflation has brought on extra stress to already strained family budgets. 

Coach Your Daughter Out of This Crisis

Here are my step-by-step recommendations to assist your daughter out of her current financial mess. 

Ask Her to Analyze Her Spending Habits

Sit down with her to study her credit card bills, bank accounts, and cash receipts. Ask her: where did you overspend—food, drinks, clothes, entertainment, pets, personal care, etc.? Have her keep a notebook, and record every dollar she spends. Every week, do a spending check-up. Ask her: what can you logically reduce or cut? Is she using after-pay at her own retail establishment? This habit must be stopped now. 

She may need to make some painful sacrifices, like selling a car, moving, or taking on another job to increase her available income to pay down some debt. 

Ask Her to Analyze Her Friends/Family

The next questions should be: With whom do you spend money? What activities drive your spending? If it is a healthy relationship with friends or a significant other, ask her to be open with them about her desire to spend less in order to pay off debt and build a savings account. Otherwise, suggest that she make new friends. Is somebody always borrowing money from her? Lovingly explain that she can no longer be their banker, just as you can’t be hers. If someone owes her money, explain to her how she can collect it. They may be abusing her generosity. 

Ask Her to Analyze Her Financial Future

This is where you can best counsel your daughter or anyone else with debt issues: 

• Define stewardship: we are entrusted to manage what God provides.
• Work with her to set a goal to give and save something every month. 
• Ask her to embrace a plan for debt payoff: snowball, avalanche, balance transfer, or a combination.
• Suggest a mentor relationship to learn about the need for wise planning. 

Ask Her to Consider the Joy of Financial Freedom 

Children benefit from other Christ-centered relationships, in addition to their parents. Seasoned adults can prepare the young for their future with patience, wisdom, and Biblical financial advice. Your goal is to have children who find meaning and purpose in life, are grateful for what they have, and are financially free to follow the Lord. Show her these benefits of spending and accumulating less:

• Freedom from the control of things and lenders
• Flexibility to prepare for future needs
• More time and money to use with intentionality
• Greater contentment and gratitude 
• Ability to give and serve as the Lord leads
• No burden of downsizing when you are old and tired

Ask Her to Learn about Contentment 

Contentment means we are satisfied. When content, we can exercise self-control, a fruit of the Spirit, that enables us to say no to what we want. Ask her to memorize these Scriptures: 

• Luke 12:15 – And he said to them, “Take care, and be on your guard against all covetousness, for one’s life does not consist in the abundance of his possessions.” 
• 1 Timothy 6:7–10 – For we brought nothing into the world, and we can take nothing out of it. But if we have food and clothing, we will be content with that. Those who want to get rich fall into temptation and a trap and into many foolish and harmful desires that plunge people into ruin and destruction. For the love of money is a root of all kinds of evil. Some people, eager for money, have wandered from the faith and pierced themselves with many griefs. 
• 1 John 2:16 – For all that is in the world—the desires of the flesh and the desires of the eyes and pride of life—is not from the Father but is from the world.
• Hebrews 13:5 – Keep your life free from love of money, and be content with what you have, for he has said, “I will never leave you nor forsake you.”

For additional resources, Crown has Budget Coaches and online courses. Christian Credit Counselors is a trusted source of help for a debt management plan. Thanks for writing. I am excited for you and your family as you go on this journey together.

This article was originally published on The Christian Post on June 23, 2023.