--- title: Improvement Era description: Monthly periodical of the Mormon church, 1897 onward. This library holds the issues of November 1897 to December 1930. authors: - Smith, Joseph F. collections: - periodicals tags: - magazine - improvement-era periodical: Improvement Era volume: 8 number: 11 published: 1905-09 publisher: Young Men’s Mutual Improvement Associations publisher_place: Salt Lake City language: en type: magazine reference: 'Joseph F. Smith, "Editor’s Table—Avoid Debt and Credit," *Improvement Era* 8, no. 11 (September 1905): 865–867.' source: url: https://archive.org/details/improvementera0811unse transcription: Transcribed from the Internet Archive scan of each issue (the item for each issue is named in the issue's own source); unnumbered advertising leaves are omitted, printed page numbers are kept as page markers. identifier: improvementera0811unse start_page: 865 end_page: 867 rights: status: public-domain basis: US publication 1930 or earlier (published 1905-09) source: https://archive.org/details/improvementera0811unse publication_year: 1905 note: The Internet Archive item metadata carries a blanket "© Copyright by Intellectual Reserve, Inc." notice. The library owner judged it inapplicable because this issue was published in 1905, before 1931; a scan-level notice does not restore copyright. --- # Editor’s Table—Avoid Debt and Credit EDITOR'S TABLE. AVOID DEBT AND CREDIT. An incident came under my observation some days ago which, as an illustration showing the value of correct business methods, is worth a passing notice. It appears that in one of our settle- ments a co-operative store had existed for many years, under di- verse management. Its affairs had been so carelessly attended that in course of time was involved in debt to the amount of it many thousand dollars. The principal reason assigned for this condition was that through the credit system large sums of mon- ey were outstanding in many small accounts which it seemed im- possible to collect. The people failed to pay. Finally, it became necessary for the directors to cast about them and see what could be done to relieve the financial strain. It was thought best to sell out,but the stockholders could not make an offer, under their finan- cial burden, without, perhaps, levying an assessment. At least, the complete sacrifice of their entire stock was apparently necessary. Oae of the directors at length offered to conduct the business at a stated salary, provided, he should be given complete control. It was agreed that he should not be interfered with, and so he undertook to resuscitate the institution. He announced that here- after all business would be transacted on a cash basis. No more credit would be given. The sequel was that in three or four years the concern was on its feet, with all its debts cancelled, money in the bank, and it is now thrifty and prosperous. The lesson to be learned is one of business economy; and one which the Latter-day Saints earnestly should take to heart. As a people we are doing too much credit business, not only in our mer- cantile and other trade establishments, but in our private business 866 IMPROVEMENT ERA. affairs. It would be much better for us, and our prosperity, not to say peace of mind, would be much greater, if, like the new man- ager, we determined to place our affairs on a cash basis and re- fused to give or ask so much credit. Why? Because credit bus- iness leads to carelessness, and to such extravagance as a person would never think of indulging in, if cash were paid at the time of purchase. It costs 20 per cent more to operate a credit business than one conducted on a cash basis. It is safe to say, also, that the creditor loses that amount, whereas, if he paid cash he would gain it. Somebody pays that great sum: either the seller or the purchaser, — sometimes both. Credit plunges people into finan- cial bondage, brings them disrepute — no matter how honest into their intentions may — and frequently destroys good name and be, character. Credit often involves persons in bankruptcy, and is most frequently at the root of all financial failure. It involves men in bondage which often works destruction to their characters as well as to their whole course in life. Only the free are free, and no person in debt is free. Of all people on earth, the Saints should be the freest; and, in order to fulfill the desires of their hearts as Latter-day Saints, they above all people should be free from debt. The Lord has taught his people to keep themselves free from all extravagance; and it is as much a duty we owe to our families, to live within our means, and protect them from debt, as it is to devote our lives in other ways to their temporal and spiritual pro- gress and protection. In fact, keeping out of debt and holding ourselves financially free, are conditions upon which both temporal and spiritual progress depends. Many good men have gone into financial bondage because of the extravagant notions of their fam- ilies. Thev demand leisure, dress, and entertainment, out of all proportion to the family income. Then it is that the pernicious credit system carries them still farther, until not only financial, but also moral, ruin stares them in the face. Deceiving, lying, stealing, and general demoralization of the character, follow. We have great need to exercise economy in many ways to pro- tect ourselves from financial bondage. On the farm, in the matter of the purchase of carriages and machinery; in the home, in dress, food, drink and entertainment. It is, besides, coming to be the EDITORS TABLE. 867 fashion, not only to visit constantly every pleasure resort and theatre, during the season, but also to travel afar, to the east and to the west, to the north and the south, in search of entertain- ment and pleasure. It doesn't require much of a political econ- omist to predict ruin as the result of such a course, especially where, as in most cases, money for the purpose is obtained on credit. Under the credit system, too, extravagance is multiplied. The people are encouraged to overbuy, and to carelessness and indif- ference in the payment of their obligations. Honesty should be a characteristic of the people as a whole, as well as of the individ- ual, and where much credit is the rule, this principle is discour- aged, and the payment of debt is postponed, while the money is used for other purposes. The Saints should learn that it is not right, and leads to grave evil, to spend money in luxuries, for out- ings and other pleasure trips, that is not their own, or that has been obtained by going into debt for necessities. No luxuries for undue travel, dress, for eating or drinking, for amusement or en- tertainment, should be tolerated by the head of a family or de- manded by its members, until the honest debts for necessities are cancelled. This is a good resolution to make for the young man who is entering upon business for himself, no less than for those who have already entered. To live within one's means, pay one's debts promptly, avoid credit as much as possible, both in giving and receiving, are old but worthy business maxims. Their observance should become a fixed habit with the man who desires to prosper in temporal affairs, and to lay the foundation of a character upon which a rich spiritual structure may be builded. Finally, while times are prosperous, get out of debt, and then keep out; pay as you go, and do your business on a cash basis. Joseph F. Smith.