Buddhism and Debt

Has anyone ever noticed anything in the teachings of Buddhism about the need to avoid financial debt?

There’s a great financial advisor in the US who really gives a lot of good practical and Biblical reasons to avoid debt, and I was wondering if there’s something similar in the Buddhist teachings. (He often brings up several quotes from the Bible, such as “The borrower is slave to the lender,” and “One who cosigns for another is stupid.”)

As a monk at a large center in Korea, debt is one of the three main reasons I see people coming here in crisis. (The other two are health and spiritual crisises).

My own teacher really comes down on debt as well, I suspect because of the suffering it causes. She doesn’t talk about it much, in part because avoiding stupid things may seem too obvious, and in part because most people may not want to listen.

 I’d like to know about any deeper, Dharmic connections related to debt that anyone may have heard of as well.

 The financial advisor I mentioned has a favorite saying “Broke, Desperate, and Stupid are three brothers that always hang out together. When one shows up, the others aren’t far behind.” From what I’ve observed that’s really true. Nearly all of the truly stupid (non-alcohol related) things I’ve seen have been a result of financial desperation.

with palms together,

Chong Go

18 thoughts on “Buddhism and Debt”

  1. Hi Chong Go Sunim,

    Hand up. Guilty! I’ve struggled a lot with debt in my life, and the more I think about it now, the more I see it in terms of the precept not to take what is not yours. The money isn’t actually yours at all when you borrow it, you are taking it from a future hypothetical self – who may not be able to afford it.

    Anyway, I did a quick search and found that there was a workshop on Buddhism and debt held by the Oregon Zen Community last year. Here’s a link: http://www.oregonlive.com/living/index.ssf/2009/11/zen_buddhists_host_session_on.html

    “Rivers can sometimes fill their banks, but the wants of human beings can never be filled.” – The Buddha

    All the very best,


    1. Hi Marcus,
      Thank you for your response, it resonated with me:), and I read the link, good stuff.

      I too have been guilty of spending money just as I eat sugar, out of desires/comforts and wants, and have gotten myself into a big financial mess! However, I also have realized that it is in the awareness of how and why I am spending that is my lesson. And if my financial mess had not been as large as it is, I would not be forced to take a good look at myself!

      “Rivers can sometimes fill their banks, but the wants of human beings can never be filled.” This, for me, can only be realized at a deeper level when finding oneself standing within it and then being able to see oneself standing there.

      With Gratitude to All,

  2. In the Ina Sutta in the Pali Canon (AN 6.45 – see link below), the Buddha describes debt as the inevitable result of:

    – Partaking of sensuality
    – No sense of conscience with regard to skillful mental qualities

    It’s an interesting sutra. Although short, it provides a compelling description of debt and the impact of debt on a person’s life, particularly in the concluding poem.

    I’m also struck by the Buddha’s teaching that the various mistaken actions that produce debt result in a certain kind of mental process: “May they not know about me.”

    When we go into debt, we seek to hide away from others. Which, of course, is the same as hiding away from ourselves.

    I’ve worked some with people who go into debt. In all but a very few cases of genuine and unpreventable tragedy – illness, etc. – the debt arises out of a deeply held sense of entitlement.

    We tell ourselves stories about how we’re entitled to the new flat-screen television. Or a new wife. Or that great new Buddhist book.

    Until we come to terms with the rage that drives the entitlement, we’ll never have the great wealth described by the Buddha.


    1. “…television. Or a new wife…” ??? woman is not a thing! How can you even put “wife” in the same row with television and book, I mean, really???

  3. I am not sure debt itself is cause of suicide, it maybe more like a trigger. Financial debt is like karma, you have to pay back eventually, however like karma it can get eliminated, erased, so it is not always that you have to pay back. One of the good things in Soviet Union was that there was no private property and no such things as credit cards, or any kind of loan, nobody had big money (officially), nobody had a private business and education was free, there was no unemployment either, but salaries were barely enough and many people borrowed from each other, went to pawn shops and some tried to make money in illigal way (like reselling something). People went to get higher education not because of money, but it was higher ideal (workers in factories made way more money then doctors and engineers). I had no idea of what a loan is. In Canada though I went to school and I was offered a student loan and as I worried about paying it back I was told – no worries, take the loan, you will work in the summer, pay back later, or if you can’t, there is loan forgiveness program, it will be then a grant. So I happily took the student loan, and had a wonderful time at that school (my dream came true!). It’s a very long story, but things changed, all turned upside down for me and I could not pay back the loan, some of it was forgiven, but the rest I cannot and do not want to pay. Banks make crazy profits by giving loans, the percentage is too high, but capitalist system works on these monetary relations.
    However that going to school was enormously wonderful thing for me, because of it I found what I was actually looking for – Dharma (also very long story).
    I think if you borrow and use it for good thing/cause, then it is the right thing to do (universe will support you (how about that!))
    In Muslim world, Islamic banking has the prohibition on interest. The Qur’an forbids the charging of Riba(interest) on money lent.
    I think it all comes down to greed, if someone lends money hoping for profit, it is better to avoid connection with that.

  4. Hi all. Um, sorry to be the downer historian here, but Buddhism was founded in part on debt, at least in China. Buddhist monasteries, because of their liquid assets in the form of silk and cash donations, became early lending institutions. Because they were part of a network, they could offer over credit over distances for merchants. And the interest they charged for loans counted as meritorious donation for the debtors. Check out: Jacques Gernet, Buddhism in Chinese Society.

    However, in a society where small farmers were often struggling with imminent financial disaster, and interest rates were typically 50%, the lower rates of interest charged by Buddhist monasteries could be considered a form of micro-credit.

    This is, I realize, a different kettle of fish than the credit-addiction cycles of consumer capitalism, which may destroy us all. But it is interesting to note the role of Buddhist institutions in creating a proto-capitalist sector in medieval China.


    1. It is not that it is ‘buddhism’, but the culture, I think. People mix cultural believes, traditions heavily into religion. Buddha himself was not teaching for monasteries to be lender who takes interest, people just adapt whatever to their own way of thinking. Buddhist institutions in medieval China were often far removed from actual teaching of the Buddha. But I really like your comment.

  5. Debt is an interesting issue. Seems to me in the United States anyway, it’s encouraged, and in fact, often required to participate in “normal” life – i.e. home ownership, car ownership, etc. I don’t own either of the things I mentioned, and haven’t been in financial debt for since grad school, but I also find that not having debts has required a hell of a lot of sacrifice. It doesn’t seem like the right approach some days; other days I’m grateful not to have to work more just to pay my bills.

    1. Thanks for the great comments and links everyone! _/|\_ ^^

      The modern consumer debt really strikes me as a form of indentured servitude, where for a few baubles up front, we agree to send a constant stream of income back to the finance company for what often works out to be the rest of our lives. If someone is sending 20-29% of their disposable income (as interest) to the finance company, what are they going to be saving with? One of the neat things about Korea, is that (traditionally, at least) they have money saved up for an emergency. $5,000 bill for emergency surgery/car repair? Not happy, but you just pay it and move on. Whereas with the credit cards, you never get to move on, and you’re even more dependant upon them, because you sent as interest the money you could have otherwise saved as an emergency fund.

      I’m a fully ordained monk, and don’t really have to worry about this stuff personally, but I see so much (needless!!) suffering caused by this issue.

      Ultimately, I guess it comes down to our ability to delay gratitification. To the extent that we can let go of desires, and not be swept up in them, we can avoid puting ourselves at the mercy of these mega banks. That said, if you or someone you know is caught up in the middle of a financial mess like this, check out anything by Dave Ramsey. Two of his recent books are “The Total Money Makeover” and “Financial Peace.” They’ve really been useful to me for helping counsel people with serious money problems. One of their outstanding aspects is how to deal with the credit card companies, and avoid the scams and emotional tricks they use.

      1. ordained monks also can have credit cards and sometimes they also can forget to pay the bills and then they have to pay big interst.
        Credit card is great if you don’t misuse it, it is very convinient and all you have to do is to pay on time, then you pay no interest ever. If you have no money to pay the bill then don’t spend, it is as simple as that, emergency spending usually is not what causes problems with some people, it is the chronic useless spending, addiction to shopping, which is kind of like drugs or alcohol which some (many) people use to relief general suffering of samsara.

  6. Hello:
    I am wondering if the intention behind the debt is the important question.
    The thinking process that led up to it.
    Also, what about different ‘types’ of people.
    At age 65 I have never been happy with debt. My husband and I bought
    a house that we could pay for in three years time. It is a modest house,
    in a lovely neighbourhood.
    However, I seem to have been born with some kind of inner sense
    of that.. Even as a child, I always put some money
    away (even though it was not a lot to start with). The equivalent today
    of one hours minimum wage, would be what my grand-mother gave to me.
    My siblings had their own patterns which were quite different.
    However, my pattern can now include holding on too much to that which
    should flow through my life.
    I also read that using a credit card for purchases in an unhealthy way
    (I guess without mindfulness)can allow the person the illusion of
    a life style that they can not afford.

    Hope that this may be helpful in some way to others.

  7. I’ve been listening to Dave Ramsey forever. I have several books written by him and I have given those books to a lot of my friends. I’m also a youth leader in my Buddhist organization (SGI) AND a high school teacher in South-Central Los Angeles. South-Central LA is known for gangsters and ghetto living areas. If you want to know true American poverty come on down! My high school seniors ask me questions regarding college tuition. Few wise students listen to my advice. While the rest of them take loans out loans at $20k a year and say that’s it’s worth it for education and that will continue the vicious cycle of proverty. I always respond back and say, “I went to college debt-free. It’s called going to community college, transferring to a 4- year college, and applying to more than 100 scholarships”. A smart grandmother would even say that you shouldn’t buy anything you can’t afford. Lastly, the the person who said that your karma will eraser or forgive your debt even if it’s the right reason, you’re wrong. Your actions effect your immediate environment, like your family members. Your debt will taint 7 generation from the past and 7 generations in the future. You have to change your actions to completely transform you and your family’s karma. Otherwise you’re just selfish.

  8. My family pressured me to go to college at 18, like most kids in the US. As a child I thought I had to and believed my parents. Now, I may be in debt the rest of my life. If I’m lucky, a few years to a decade.

    Today I don’t get to work toward, or live, my dreams. Tomorrow I don’t get to work toward my dreams either. I do get to pay off a small portion of debt, before interest makes it back. What’s the point of living, when everything that I am, and have been, is a slave who has to serve corporate and government interests that act to kill foreign entities and brainwash more children into a lifetime of debt and service with the label “Hard Work”.

    I wish there was a way out, but this isn’t something that can just be let go. Wish I could live at a monastery, travel, write, meditate. Sadly, I’ve a life sentence and my girlfriend has a much worse sentence than I.

  9. Well Anthony, I am no financial adviser but I’d say that if you are that unhappy with your situation bankruptcy would be more like a bad dream compared to the nightmare of a life indebted and unhappy. I think most student loans still have to be paid back, but perhaps your other finances could be moved around. A bankruptcy lawyer has likely seen many cases like yours. And maybe you could come out of it all with a degree and a little smudge on your credit, which could even out. Either way, a move toward a simpler life could be good.

  10. It makes me sad that I cannot enter Buddhist monastic life because of debt. In my case, I didn’t run up a huge credit card bill at the mall – mine is medical debt from kidney cancer several years ago when I was uninsured (USA) and from student loan debt. I’ve done a lot of reflection, searching, etc… in the past year, and was seriously contemplating becoming a Buddhist Nun, but just found out that I can’t.

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