Church Members Find Relief And Community By Paying Off Each Others' Debts

When Marguerite McDonald joined Circle of Hope Church in Philadelphia more than seven years ago, she was looking for community. She found that and much more.

(Marguerite McDonald's story begins at 10:55)

At one of her first services, Marguerite heard about worshipers getting together to pay off each others' debts. It was a stunning revelation, especially as she was carrying around $8,000 of credit card debt at the time.

Marguerite admits some of her debt was due to bad spending habits throughout college. Then, she got a coveted but low-paying post-doctoral position as a biotech researcher after graduate school.

"I just never made my paycheck last through the month," she says. "I wasn’t saving any money. I was just trying to figure out how do I pay down my student loans and my credit card debt now?"

'Get Rid Of The Shame'

Each "Debt Annihilation Team" is made up of a handful of church members. In addition to making their regular monthly payments, they commit to paying a little extra each month toward someone else's debt.

The church gives each group of debt annihilators "seed money," which is around $8,000 to $10,000 in loans and donations to get started. The group then tackles the debts with the highest interest rates first. That way, they end up paying less money to creditors over time. It's basically a group version of the 'avalanche method' of paying off debt.

It's not just good math. Marguerite says helping people fight debt is a way to practice "Sabbath economics," a philosophy rooted in the Bible. This is the belief that there's enough wealth in the world and that followers are expected to fairly distribute it.

Marguerite found community support from church members who took time to teach her practical skills like budgeting. Others listened to her and gave her advice when she needed it.

"In addition to getting out of debt, I think you get rid of the shame that surrounds it and also figure out a new way to think about money," Marguerite says.

Full Circle

It took two years for Marguerite to pay off her credit card debt with the help of her fellow church members. But she didn't stop there. She also paid money to help replenish the church's seed fund and now leads Circle Of Hope's Debt Annihilation Team. Marguerite says giving back is her way of showing the same compassion others showed her throughout this process.

"My next goal is to see if we can take it outside of the fringes of the church," Marguerite says. "The future is wide open and I’m going to stick with it."