Proverbs 22:26-27, “Be not one of those who give pledges, who put up security for debts. If you have nothing with which to pay, why should your bed be taken from under you?”
There will always be goods, services, and experiences that are beyond your reach to afford. In this day of relentless marketing, some scrupulous entrepreneurs seem to deliberately exploit our natural tendency toward discontentment. Those who fall prey to this way of thinking find themselves pursuing the stuff money can buy without the money to buy it. Creative financing is used to buy now and pay later. Inevitably something goes wrong with pay later part and the desperate search for rescue begins.
If you have more money than you need to sustain your routine, then you become the target of appeals for financial aid. For some people there’s a temptation to help. It feels good to be needed. It feels merciful to assist. It feels awkward to say no. Unfortunately, none of those reasons justify the move. You’re not obligated to put your good name (and money) on the line to subsidize someone who doesn’t have the income to justify their lifestyle.
The pledge Solomon talks about was a promise to pay a debt if someone couldn’t. At the time it’s made, I’m sure the evidence suggested default was a remote possibility. No one with even a token amount of financial sense will voluntary obligate themselves to pay the debt of another person who clearly doesn’t have the income to make the payments. The only exception would be certain banks during periods of time, most recently in the early 2000’s.
The bottom line is, it’s a bad idea to agree to pay someone else’s debt. If your own debt is worth getting out from under, why risk yourself with someone else’s? Why avoid a situation where you could get stuck the debt? There’s a strong possibility you will. The consequence is that what you pledged is gone before you know it. This practice involves offering something of value that the lender could take from you in exchange for the money they owe. It’s called security. However, the security is not for you, but for the lender. Solomon clearly states that this is a bad idea.
Notice the emphasis is not necessarily on debt, but risk. Wisdom is shown by an aversion to any situation that threatens their own financial security. When we talk about security it should be from two sides. The first side is security that comes from wealth. When a family accumulates a certain amount of wealth, it can live peacefully, knowing that any unexpected cost can be paid for or insured against. They have reached the point where they are essentially impervious to the economic forces that bring others to their knees. The other side of security is the absences of financial stupidity, and that kind is not dependent on income or wealth. You can have very humble means and still be secure. When we look at this kind of security, we see a person who is wise enough to avoid the pitfalls that bring poverty and destitution to the fool. The wise person may actually be lowly in comparison to others, but they are not foolish enough to imperil what little they have by securing the debt of others.
In this example, the creditor will come looking for money, and if you don’t have cash to back up your promise, then he will take what you pledged, in the case your bed. So the pledge here is a bed, and it serves as security. The person in view here likely doesn’t have much gold or silver, so they need to put up their own personal property as collateral. A modern day example would be a parent who takes out a second mortgage to finance a child.
Picture it. Danny Blunt, an unemployed forty-year-old who lives in his parent’s basement and plays video games decides to do something with his life. So he approaches his parents because the only thing between him and biblical manhood is the tuition money to attend a University named after his favorite real estate mogul. He knows mom and dad don’t have the cash to lend him. So he takes the advice of an advisor and encourages them to get a thirty-thousand-dollar loan against their home, which just happens to be most of the equity. He explains that interest rates are low, and then guarantees that when he makes his first big deal he’ll pay them back and then some. It’s basically a no brainer.
Can you guess where this is going? Unfortunately, things don’t go as planned. The training program turns out to be less than useful, and now mom and dad owe the money they’ve borrowed but can’t make the payments. The initial interest rate that made the payments possible for the first six months have doubled. To make matters worse, after a few delinquency notices, the bank sends the Sheriff over to evict them, and though they get to keep their bed, they lose the bedroom and the rest of the house it’s attached to. That’s what it looks like when foolish people make a pledge on behalf of someone else. They voluntarily put their own estate at risk to enable an unqualified buyer to purchase goods or services they can’t afford and shouldn’t have.