“Be thou diligent to know the state of thy flocks, and look well to thy herds.” — Proverbs 27:23
Lesson
What You Will Learn
- Gather the information needed for a complete debt inventory
- Classify debts as secured, unsecured, collection, court-ordered, or family support
- Record balance, minimum payment, rate, and status for each debt
- Calculate total debt and total monthly minimums
Lesson Notes
Why Make an Inventory?
You cannot make a plan for numbers you have never written down. A debt inventory is a single list of everything you owe. Most people feel relief once it is finished, even when the total is large, because the unknown is usually more frightening than the truth.
Proverbs 27:23 calls us to know the state of our flocks. An inventory is how we know the state of our debts.
Where to Find the Information
- Your free credit reports from AnnualCreditReport.com (after release or when allowed).
- Letters and statements from creditors and collectors.
- The court clerk or probation office for fines, fees, costs, and restitution.
- The child support agency for child support balances and arrears.
- Your own records and memory for informal debts, such as money borrowed from family.
In class, never bring real account numbers or personal reports. Use the sample documents. Keep personal records in a private folder.
Types of Debt
- Secured debt is backed by property the lender can take, such as a car loan.
- Unsecured debt has no property attached, such as most credit cards and medical bills.
- Collection accounts are debts the original creditor sent or sold to a collection agency.
- Court-ordered debt includes fines, fees, court costs, and restitution.
- Child support is a family obligation set by an order.
Court debt and child support are handled differently from consumer debt. They carry legal consequences and are never treated as optional (Module 5).
What to Record
For each debt, record: creditor, type, current balance, minimum monthly payment, interest rate (if any), due date, and status (current, late, in collection, on a payment plan). Mark anything you do not recognize as “Verify” instead of adding it to your total. It may be an error or identity theft (Module 4).
Add up two totals: the total balance and the total of monthly minimums. The second number tells you what your budget must cover each month just to stay current.
Key Terms
| Item | Details |
|---|---|
| Debt inventory | A complete list of everything you owe |
| Secured debt | Debt backed by property the lender can take |
| Unsecured debt | Debt with no property attached |
| Collection account | A debt sent or sold to a collection agency |
| Minimum payment | The smallest required monthly payment |
In-Class Activities
Sort Denise's Mail
Denise has a stack of mail. (Denise is a composite example.) Classify each item by type and build her inventory:
- Valley Medical collection: $300 balance, $25/month
- Phone company bill now in collection: $450 balance, $30/month
- Store credit card: $900 balance, $35 minimum
- Used-car loan: $2,400 balance, $120/month
- Court costs: $600 balance on a court payment plan of $40/month
- A “Quick Cash” loan for $1,150 opened in a city she never lived in, while she was incarcerated
What is her total balance and total monthly minimum? Which item should not be added to her total, and why?
Inventory Worksheet Practice
Copy the inventory headings onto a blank page: Creditor, Type, Balance, Minimum, Rate, Due Date, Status. Fill it in for Denise. Then make a blank copy for your own private use (you may keep it in your private folder, not in your workbook).
Assignment: My Debt Inventory
Complete a debt inventory using either your own information (kept private) or the composite example your instructor provides.
- Include every column: creditor, type, balance, minimum, rate, due date, status.
- Mark anything unfamiliar as “Verify.”
- Total the balances and the monthly minimums.
- Write one sentence about how you felt before and after finishing it.
If you use your own information, you may turn in only the totals and the feelings sentence.
Graded with the Module Assignment Rubric.
Reflection Journal
Proverbs 27:23 asks us to know the state of our flocks. What feelings came up as you faced the numbers? Where did you sense God's presence, or where do you need it now?
Prayer focus: Ask God for courage to look honestly at what you owe and for peace that is greater than any number.
Weekly Reading & Devotions
Counting the Flock
A shepherd who never counts her sheep cannot know when one is missing. Proverbs 27:23 calls us to know the state of thy flocks. Your debt inventory is how you count. It turns a cloud of worry into a list with names and numbers.
This week you learned to record each debt's creditor, type, balance, minimum, rate, due date, and status. You learned that court debt and child support belong on the list but follow different rules, and that anything unfamiliar gets marked Verify instead of added to your total.
Denise found a $1,150 loan she never took out. (Denise is a composite example.) If she had simply added it to her list and started paying, she would have paid someone else's debt. Counting carefully protected her. Accuracy is not just good math; it is good stewardship.
Many women say the hardest part is starting and the second hardest is finishing. When the list is done, take a breath. Thank God that you know the truth. Knowing is the doorway to a plan.
Think About It
- How did you feel before and after building an inventory? ______________________
- Which debt surprises or worries you most? ______________________
- Where will you keep your private records safe? ______________________
Daily Devotions for Week 2
Know the State
Be thou diligent to know the state of thy flocks, and look well to thy herds.— Proverbs 27:23 (KJV)
Diligence starts with knowing. A list is an act of faithfulness.
Reflect: What do you still need to find out?
Pray: Lord, give me diligence to know the truth.
Do: Write down one piece of information you need to gather.
Count the Cost
For which of you, intending to build a tower, sitteth not down first, and counteth the cost, whether he have sufficient to finish it?— Luke 14:28 (KJV)
Jesus praised planning. Counting what you owe is the first stone in building freedom.
Reflect: What are you building with your life?
Pray: Lord, help me count the cost wisely.
Do: Total one column of your inventory.
Search Me
Search me, O God, and know my heart: try me, and know my thoughts:— Psalm 139:23 (KJV)
As we look honestly at our finances, we can invite God to look at our hearts, our fears, and our hopes.
Reflect: What feelings come up when you look at your numbers?
Pray: Lord, search my heart and bring peace.
Do: Spend five quiet minutes giving your worries to God.
The Truth Makes Free
And ye shall know the truth, and the truth shall make you free.— John 8:32 (KJV)
The truth about what you owe is not your enemy. It is the beginning of freedom.
Reflect: What truth have you been avoiding?
Pray: Lord, give me courage to know the truth.
Do: Open one letter you have been avoiding, or plan when you will.
Make It Plain
Write the vision, and make it plain upon tables, that he may run that readeth it.— Habakkuk 2:2 (KJV)
Writing things down makes them clear enough to act on.
Reflect: What needs to be written plainly in your life?
Pray: Lord, make my path plain.
Do: Rewrite your inventory neatly, with totals.
Module Quiz
- 1.
A car loan where the lender can take the car is:
- 2.
If an account on your list is unfamiliar, you should:
- 3.
Where should you get the balance owed on court costs or restitution?
- 4.
You should bring your real credit report and account numbers to class for practice.
- 5.
Denise's debts are $300, $450, $900, $2,400, and $600 in court costs. What is her total balance?