The financial crisis affects everybody but not everybody equally. Working in the charity sector (and more specifically, the church) insulated us from much of it and our church was fortunate in that very few were hit by redundancies. Now that we’re in a blissful mortgage free state (and house free state) in another country I thought I’d reflect a little on this ongoing mess we call the global economy.
On a personal level I think it would be fair to say that we were net beneficiaries of the parlous state of our nation’s finances. With low personal debt, living within our means we gained as interest rates fell. We had a tracker mortgage (2% above the base rate) and we’d set it up so we could overpay without penalty. A further blessing was that we were committed to sharing our home with someone who became a great friend and her contributions to the house went to overpaying on the mortgage.
In May 2008 the interest rate on our mortgage was 5.89%; less than a year later it was 2.5% and we were £150 a month better off. From May 2008 to October 2011 the financial crisis saved us just over £6000. Thanks very much.
Now if we were good consumers we would have spent that money and sunk it back into the economy. Instead we chose to be good citizens and help our bank recapitalize by using that money to pay down our capital. Our aim was always to reduce the mortgage as quickly as possible to free us to give more or serve the church more easily because our living costs had been brought down as low as we could manage. Simple living in order to be missional. It also, of course, gave us that bit of freedom to absorb the additional costs of a second child and to give more.
A financial crisis of this scale is not exactly something to be thankful for, but because we eschewed the notion of personal debt, because we believed in simplicity of lifestyle, reducing debt to maximise giving and because we believed in sharing our home we were not only protected from the shock but were also in a position to benefit.
The second reason is that despite the issues in the housing market from 2008-2011, the house we owned increased in value by nearly 40% in less than 9 years. So we gained again by being able to reduce our mortgage faster and through an overall increase in our assets. This is all very nice for us.
But here’s the kingdom angle. Now I can afford to house my family in Stockholm, the capital city of one of the most expensive countries in the world. Simply put, being a good steward of money meant that even during a financial crisis we could still be mobile and go when God called us to. I realise that not everyone will be so fortunate but the principle, I think, is sound: Good stewardship can be a servant to mission now as well as in the future.