Christian Financial Perspectives: Recent Episodes
Christian Financial Perspectives
God never intended for us to navigate life—or our finances—alone. In the final episode of this 12-part series, Bob and Shawn explore the Biblical importance of seeking wise counsel and explain how Christians can evaluate financial advice through the lens of Scripture. From the character qualities of a trustworthy advisor to the practical questions every investor should ask, this episode offers a framework for choosing counsel that honors God. As the series concludes, listeners are encouraged to remember that financial decisions are ultimately spiritual decisions rooted in faithful stewardship. Whether you're selecting a financial advisor or seeking wisdom for life's next chapter, this episode reminds us that God's Word remains the ultimate foundation for every financial choice. It's a fitting finale to The Biblical Worldview of Money and Wealth, equipping you to steward God's resources with wisdom, integrity, and confidence.
The Bible speaks often about inheritance, but its greatest emphasis isn't simply on passing down wealth—it's on passing down wisdom and faith. In this episode, Bob and Shawn explore the Biblical principles behind financial, spiritual, and eternal inheritance, highlighting why preparing the next generation is far more important than the size of the inheritance they receive. You'll discover practical insights on avoiding common inheritance mistakes, protecting wealth for future generations, and placing God at the center of your legacy. More importantly, this episode challenges Christians to leave behind more than money by equipping their children and grandchildren with the Biblical wisdom needed to steward God's blessings for generations to come.
Retirement is one of the most widely accepted goals in modern culture, yet the Bible has surprisingly little to say about retirement itself. In this episode, Bob and Shawn explore what Scripture does say about work, purpose, and serving others during the later seasons of life. By examining the Bible's only direct reference to retirement and contrasting it with the more than 500 references to work, he challenges listeners to rethink retirement through a biblical lens. Rather than viewing retirement as an escape from responsibility, Christians are encouraged to see it as an opportunity to serve God in new ways. Whether through mentoring, volunteering, missions, investing in family, or supporting the next generation, retirement can become a season of renewed purpose and Kingdom impact. If God has given you more time, how will you use it to finish life well and glorify Him?
In this episode, Bob and Shawn explore God’s design for work and why Scripture consistently presents work as a gift—not a curse. From the Garden of Eden to the teachings of Paul, this conversation reveals how work provides purpose, builds character, creates opportunity, and allows believers to reflect God through diligence and stewardship. You’ll discover how faithfulness in work impacts not only finances, but also relationships, fulfillment, leadership, and spiritual growth. The episode also contrasts the blessings of diligent work with the serious consequences of idleness and laziness described throughout Scripture. Through practical insight and biblical wisdom, listeners are challenged to rethink their attitude toward work, recognize their God-given purpose in the workplace, and consider how their daily efforts can become an act of worship and a testimony to others.
In this episode, Bob and Shawn unpack the Biblical connection between honesty, integrity, and lasting financial stewardship. They explain how honesty—truthfulness in words and actions—and integrity—living consistently aligned with God’s values—work together to build trust, strong relationships, and a secure foundation for life and wealth. Grounded in Scripture, this conversation reveals why being faithful in the small things is essential to being entrusted with more. You’ll also discover the real-life benefits of living with honesty and integrity—greater peace, credibility, and stability—as well as the hidden costs of dishonesty, from broken trust to spiritual and personal consequences. This episode challenges listeners to examine not just what they do, but who they are when no one is watching, and how that shapes their financial future and witness.
In this episode, we explore the Biblical worldview of taxes, laws, and government, and why these topics matter deeply for faithful stewardship. While taxes can significantly impact our financial lives, Scripture reminds us that everything ultimately belongs to God, and believers are called to approach taxation and authority with humility, integrity, and obedience. Drawing from passages like Matthew 22:21 and Romans 13:1–7, we examine why paying taxes honestly and respecting governing authorities are part of living out our faith. We also discuss how the Ten Commandments have shaped moral laws throughout history and how governments serve a God-ordained role in maintaining order and justice. At the same time, Christians are reminded that their ultimate allegiance is to God, whose authority stands above all earthly rulers. This episode offers a thoughtful perspective on how believers can navigate taxes, laws, and civic responsibility while honoring God in every financial and ethical decision.
What does the Bible actually say about debt and borrowing? While Scripture does not call debt a sin, it consistently warns about its dangers—reminding us that “the borrower is slave to the lender” (Proverbs 22:7). In this episode, we explore the biblical wisdom surrounding debt, the importance of counting the cost before borrowing, and why God’s Word encourages believers to approach financial obligations with humility, prudence, and careful planning. We also discuss the deeper heart issues behind debt—why we borrow, how consumer debt can presume upon an uncertain future, and how financial obligations can limit our freedom to follow God’s calling. By examining biblical principles on borrowing, lending, and repayment, this conversation offers practical guidance for pursuing a life of faithful stewardship, generosity, and the peace that comes from wise financial decisions.
In Part 5 of our Biblical Worldview of Money and Wealth series, we tackle a challenging but vital question: how do you faithfully provide for family without enabling harmful behavior? Drawing from passages like 1 Timothy 5:8 and James 2:14–16, this episode explores the biblical responsibility to care for those in our household—especially those who are elderly, ill, or truly unable to provide for themselves. Scripture makes it clear that genuine faith requires tangible action and compassionate provision. At the same time, we examine the wisdom of Proverbs and Paul’s teaching on work, reminding listeners that consistent financial rescue can sometimes enable laziness rather than promote growth. This episode offers balanced, biblical guidance to help you navigate compassion with discernment—honoring God as you protect, provide for, and wisely support your family.
Part 4 of our 12-part series on The Biblical Worldview of Money and Wealth explores the powerful “Ownership Principle” and challenges how we define ownership from a biblical perspective. While we may legally hold title to cars, homes, businesses, investments, and other assets, Scripture reminds us through Psalm 24:1 and Haggai 2:8 that everything ultimately belongs to the Lord. This episode contrasts the role of an earthly owner with that of a manager, helping believers understand that we are stewards entrusted with God’s resources—not ultimate owners. By embracing this truth, money and possessions lose their grip on our hearts, and we begin managing them according to biblical wisdom rather than worldly priorities. With guidance from passages like Luke 16 and the teachings of Jesus, this episode explains how faithful stewardship brings peace, purpose, and eternal perspective. When we truly believe that God owns it all, it transforms how we handle wealth, investments, and every resource entrusted to us.
In this episode, we continue the Biblical Worldview of Money and Wealth series with a deep dive into Biblically Responsible Investing (BRI)—an approach that aligns your investment decisions with your Christian values. You’ll learn how Scripture speaks to ownership, diversification, wisdom, planning, and the dangers of greed, fear, and false hope, reminding us that God owns it all and we are His managers. We explore how believers can honor God through ethical investing, long-term discipline, and thoughtful decision-making that resists cultural pressures and get-rich-quick schemes. This episode challenges Christians to see investing not just as a financial activity, but as a spiritual responsibility—using wealth wisely, avoiding idolatry, and letting your light shine through every financial choice.
In this episode, we explore The Biblical Worldview of Saving, unpacking why Scripture encourages saving, how much is enough, and when saving can cross the line into hoarding. Drawing from Proverbs and other passages, you’ll learn how God uses even the example of the ant to teach wisdom, preparation, and diligence during times of abundance. We’ll cover the biblical purposes of saving—preparing for emergencies, avoiding debt, providing for family, creating opportunities, and planning for retirement—while also warning against placing trust in wealth instead of God. This episode offers practical starting steps for building the habit of saving and reminds listeners that wise saving is about stewardship, generosity, and faith, not fear or accumulation.
Bob and Shawn examine why generosity is such a central theme in Scripture and why it has quietly faded from many church conversations. Drawing from passages like Malachi 3:10, Proverbs 3:9–10, and Acts 20:35, we explore how tithing is not about obligation, but about trust, worship, and acknowledging God as the true owner of all we have. The discussion also unpacks the deeper purposes of giving—breaking selfishness, meeting real needs, advancing the Gospel, and reflecting the heart of Christ. Listeners are challenged to move beyond a purely cash-based mindset and consider giving through time, talents, assets, and planned generosity, always guided by prayer, Scripture, and godly counsel.
In this episode, we introduce a Biblical worldview of money and wealth, uncovering why Scripture speaks so often about finances and stewardship. With over 2,000 verses addressing money, the Bible provides a complete framework for handling wealth in a way that shapes the heart, mind, and soul—moving us from fear and selfishness toward contentment and freedom. We touch on 12 key biblical principles—including giving, saving, investing, ownership, debt, work, integrity, and retirement—that together form God’s design for faithful stewardship. This episode sets the foundation for a 12-part series that will explore each topic in depth, helping believers align their financial lives with God’s wisdom and experience the joy and security that come from managing money His way.
In this episode, we break down the basics of Donor Advised Funds (DAFs)—a powerful charitable giving tool that lets you take a tax deduction now while giving to your favorite ministries or charities over time. You’ll learn how a DAF works, why it’s often more blessed to give than receive (Acts 20:35), and how you can contribute various assets, invest the balance, and recommend grants when you’re ready. We’ll cover the key advantages, common drawbacks, and the wide range of assets you can contribute—from cash and stocks to real estate and even business interests. If you’re looking for a way to streamline your giving, reduce taxes, and create a family legacy of generosity, this episode will show you how a DAF can serve your mission. Tune in to learn the basics and discover whether a Donor Advised Fund is right for you.
In this episode, we walk through seven smart year-end tax strategies for 2025 that could save you thousands if completed before December 31. With major changes from the new “Big Beautiful Bill”—including higher standard deductions, senior bonuses, and tax-free tips and overtime—you’ll learn why multi-year tax planning is more important than ever. We also touch on the biblical foundation for wise stewardship from Romans 13:6–7. You’ll hear practical tips like maximizing retirement contributions, boosting charitable giving, prepaying property taxes, harvesting losses, making tax-free gifts, delaying income, and purchasing needed business equipment. Each strategy is actionable, time-sensitive, and designed to help you keep more of what you earn. Tune in for a quick, valuable guide to finishing 2025 with meaningful tax savings.
Bob and Shawn break down the Biblical Four Uses of Money—Live, Give, Owe, and Grow—to help believers gain clarity and confidence in how they manage the resources God has entrusted to them. Instead of wondering where your money goes each month, this framework offers a simple, God-honoring way to allocate every dollar with purpose. From covering essential living expenses to practicing cheerful generosity, listeners will discover how Scripture provides both guidance and motivation for faithful stewardship. Whether you’re looking to get financially organized or deepen your understanding of stewardship, this practical walkthrough of the Four Uses of Money will give you a fresh and encouraging perspective.
In this episode, Three Money Questions Every Christian Needs to Answer (But Most Never Do), we explore what Scripture teaches about stewardship through three vital questions: Who owns it all? How much is enough? And how much can I give away? Drawing from passages like Psalm 24:1, Philippians 4:11-13, and Luke 12:16-21, listeners are challenged to see money and possessions as tools for God’s purposes rather than personal gain, finding true contentment in trusting Him as the ultimate owner. This episode blends Biblical wisdom with practical financial insight to help believers align their money with their mission. Learn how to create a plan rooted in faith, generosity, and eternal impact—so your finances can become a powerful tool for Kingdom building!
How can Christian parents wisely navigate the rising costs of education while honoring their child’s unique, God-given design? In this episode of Christian Financial Perspectives, Shawn and Matthew share six Biblical principles for stewarding your children’s education—from discovering their strengths to choosing the right savings strategies. You’ll learn about state-funded programs, alternatives to traditional college paths, and smart financial tools like 529 plans. Whether you’re just starting to plan or already feeling the pressure, this episode offers practical guidance and encouragement to steward both your finances and your children’s futures with faith and wisdom.
If you are trying to figure out how to distribute your inheritance after your passing, then this is the episode for you! Bob and Shawn touch on key points on how a large inheritance can lead to a spending frenzy, a lack of understanding of how long it takes to build wealth, and more dangers when it is not distributed properly. Instead, a large inheritance has various steps and safeguards that can be put in place in order to have a better success rate so that it might last for several generations. The goal should be to pass on not just the wealth, but the wisdom and good money management habits that allowed the wealth to be built in the first place.
Have you ever been approached by someone offering financial returns so great that it must be too good to be true? Bob and Shawn discuss the patterns and tactics that these financial wolves may use to lure you and your finances into unwanted territory. Some of these tactics include the ever famous “free, luxury steak dinner” to entice you and peak your interest. However, these financial advisors can be just like “wolves in sheep’s clothing” when it comes to their manipulative tactics that they use. Many of the products they promote are rarely benefiting the consumer, and they actually benefit the advisor more than the client. When you begin to look through the minefield of promises that really sound too good to be true (because they usually are), you begin to see a pattern.
Many have succumbed to the common pitfalls of emotional investing. In this episode, Shawn and Matthew provide some quick, Biblical guidance for avoiding making emotional decisions when it comes to your finances. Unfortunately, emotional investing can lead to poor financial decisions, which in turn can lead to trouble sleeping and being OCD about constantly checking market values. Instead of letting emotions guide our decision making, especially when it comes to the ups and downs of the market, it can be important to take a step back and take a long-term, disciplined approach to investing.
“The grass is always greener on the other side” is a famous phrase that far too many people succumb to, especially when it comes to comparing their financial situations and investment returns to others. Shawn and Matthew highlight the importance of not comparing your investment returns to others since every financial situation is unique based on household, expenditures, goals, and more! They cover why each investment portfolio is unique, and why investors should focus on the importance of understanding one’s financial goals and meeting those. Some key questions to consider after listening are: “Who owns it?”, “How much is enough?”, and “Are your next stewards chosen and prepared?”
One quote you may have heard before is that, “History is doomed to repeat itself.” Bob and Shawn take this quote to heart as they discuss the various times in history that the stock market has plummeted and then come back, thus repeating itself over and over again. They look at some of the most famous “crashes” of the last 50 years, break down their causes, and then discuss the after effects of the market. Some of these famous events include: 1973-1974 oil embargo, Black Monday in 1987, And the market volatility during the COVID-19 pandemic. Despite significant market drops during these events, the past markets have consistently recovered and gone on to reach new highs in the following years or months. Bob and Shawn caution against panicking during market downturns and highlight the importance of staying invested through market cycles.
One of the biggest stressors as humans probably has to do with our finances. Almost everything requires a payment, and treating finances in a way that glorifies God is just another add-on that Christians may have, something Christian Financial Advisors calls “Christian Stewardship”. Bob and Shawn discuss Christian stewardship and its relevance in today's society. Christian stewardship is the belief that everything we have, including our time, talents, and resources, is a gift from God to be used responsibly and for His glory rather than only for personal gain. We are his managers of the money, gifts, and blessings that have been bestowed upon us. So how exactly does a Christian honor God with their finances? Biblically responsible investing is one way of showing Christian stewardship. Christians can invest in companies that demonstrate Christian values and avoid companies that violate those values, regardless of investment returns.
Have you ever considered rental house income as an extra source to add to your finances? Things may not be as easy as they seem, as rental homes are often not delivering the expected returns for investors, especially in high property tax areas like Texas. Bob and Matthew cover the estimated yield income from a rental home property in comparison to other investment choices. If rental income is something you’re interested in delving into a little more, a better alternative to rental homes may be to invest in a diversified portfolio of publicly traded real estate investment trusts (REITs). Not only can they provide higher yields of over 5% with more liquidity, they are also much less time and hassle than owning individual rental properties.
Do you ever feel like your household isn't in order, especially when it comes to your finances? This is something many people struggle with, and why it's important to have a trusted financial advisor by your side to walk you through the steps of getting your finances in proper order. Bob and Matthew discuss 10 of the areas that they see people struggling with the most when it comes to organizing finances. From choosing the proper insurance for your house and health to having an up-to-date estate plan, there are several important areas of discussion in today's episode. If you are looking for help with putting your financial household in order, our fee-based, fiduciary-driven financial advisors and planners are here to help.
Investment risk vs reward vs time is a great topic that allows us to better understand how the market works when it comes to timing and longevity. Bob and Matthew divide various investment styles up into 5-6 portfolios, with comparisons between investment portfolios and driving speeds. These include: Cash and cash equivalents, Ultra-conservative, Conservative, Moderate or balanced, Growth, Aggressive Growth. The higher the risk, the higher the possible reward, but it's also extremely important to keep in mind your time horizon when it comes to choosing an investment portfolio. Emotions can lead investors to make poor decisions, so professional guidance from fee based advisors, like Christian Financial Advisors, is valuable to help maintain a long-term perspective and disciplined approach.
Free money? Sounds too good to be true! However, Bob and Matthew discuss several ways that you can earn free money without compromising your values. This isn't a “get rich quick” scheme, but rather using your investments in wise ways in order to build wealth over time while remaining content and glorifying God. Some of these strategies are best for retirees, while others are better suited for younger investors. Sit back and listen as we discuss 3 ways to uncover “free” money.
This episode covers the in depth topic of tax-efficient asset location, which involves strategically placing different types of assets (such as stocks and bonds) in various account types (such as taxable accounts, Roth IRAs, and traditional IRAs) to minimize the overall tax burden on investment returns over time. Bob and Matthew break this down into various key points of asset allocation, asset location, how exactly it works, is asset allocation for everyone, and what is the advantage? Asset allocation is not a “one size fits all” strategy, and it can require analysis and understanding from a certified financial advisor.
Learn about one of the most powerful mathematical formulas that has been around for hundreds of years when it comes to investing – The Rule of 72. Bob and Matthew break down compounding interest and how it works through the unique mathematical formula of the Rule of 72. The Rule of 72 truly shows the power of compound interest and how it can dramatically impact long-term wealth building. Investing must have a long-term perspective by avoiding distractions. By just being patient and not removing money periodically from your investments, the Rule of 72 demonstrates how money can double in value over time at a given rate of return. How else can you enhance your investment portfolio? By starting young and investing early, as discipline is crucial.
The parable of the talents in Matthew 25 teaches powerful lessons about stewardship, trust, and making the most of what we’ve been given. This week, Bob and Matthew break down the parable of the talents, including ways that the servants may have invested, how long they invested, and what principles they might have used when choosing how to invest their talents (like how Christian Financial Advisors uses Biblically responsible investing). Key lessons from this parable and our podcast episode include: - Stewardship: We are accountable to God for how we use the resources and gifts He has entrusted to us. - Faith vs. Fear: The parable contrasts the servants who acted in faith versus the one who was paralyzed by fear, highlighting the importance of trusting God rather than succumbing to anxiety. - Growth and Accountability: The master rewards the servants who grew their talents, emphasizing the need to be productive and make the most of what we’ve been given.
This is one of the most personal podcast episodes that you may hear from Christian Financial Perspectives, as these scriptures are what have directly shaped Christian Financial Advisors and the business we are today. Because of this, Bob and Shawn have many scriptures to share that have to do with 10 Biblical principles that the business has used to guide our financial advisors (and personal finances) when it comes to Biblically responsible investing. From being good stewards of our financial resources and creation because “God owns it all,” to sharing exactly what the Bible has to say about hard work and savings, you will hear some great stewardship principles on finances. Most are pretty straightforward, but you may just have your eyes opened with these financial wisdom tidbits straight from the Bible!
Within the past 5 years, our world has truly transformed the way individuals can receive personalized financial advice, making location no longer a barrier. With advancements in video conferencing, digital documentation, and secure online access, values based financial advisors, like Christian Financial Advisors, can give personalized financial guidance without the need for in-person meetings. Even if you do live close to your financial advisor, the convenience, ease of communication, and extended adviser availability are benefits of the shift to online financial advice. Finding an advisor that aligns with your values and needs is more important than geography, as technology enables advisers to serve clients nationwide, and Christian Financial Advisors is here to help you with just that!
Are you struggling with an upcoming decision that may cost a lot financially? Many of us come to this point when it is time to purchase a new car, new house, make renovations, or anything else that can put a damper on your bank account. Finding a way to navigate the minefield of the pros and cons of a big financial decision can be confusing and stressful! This is why Bob and Shawn discuss 10 steps – or questions to ask yourself – before making a decision that is financially large. Will you go into a debt that you can't dig out of or is it something that seems like a passing whim or fad? All of these questions and more are discussed to help you the next time you need to make a wise financial decision.
Have you started setting goals and resolutions for the upcoming new year? Whether they are big or small, setting an intention for the year is a great way to start off 2025. Bob and Shawn discuss various ideas for goals for the new year, as well as the importance of writing down your new year's resolutions. Setting clear, intentional goals that are written down can increase success rates tremendously, and Harvard business studies have shown just this. Bob and Shawn also recommend setting up categories for your new year's resolutions, like physical, mental, relational, spiritual, financial, and even charitable goals.
Welcome to this unique episode on teaching your children good money habits! It's never too early to start teaching your little ones the importance of saving and giving, as well as working hard to earn your finances. Bob and Shawn go over several ways to help instill good money routines into your kids – starting from easy concepts for little ones to more abstract ideas for older children. So, sit back, listen, and grab a pen and paper to write down these tips when it comes to teaching your kids good money habits.
It's that time of year again! The time where you may try to condense as many tax strategies as possible into your finances before the end of December. If this is you, then this episode is a must listen! Bob and Shawn discuss year end tax strategies that may be used to possibly reduce 2024 tax liabilities before the end of the year. A few of the key strategies discussed include maxing out contributions to your 401k and making gifts to responsible family members. Whether you choose all of the strategies mentioned, or only a few, we hope that you gain something from this episode. As always, we encourage you to discuss these year end tax strategies with your CPA for proper implementation.
Christmas is a stressful time for most of us when it should be a time full of joy! It is a time to remember the birth of Jesus, giving back to others, and showing those around us love. Instead, it has turned into a time of stress and demand, always wondering what the best gift is to give, trying to find the best deals, and basically just surviving the season. All this is done while trying to maintain composure and put on a mask of joy. Instead, what if we changed our mindset on gift giving to bring the true meaning of the season back to the front. In this episode, Bob and Shawn discuss unique, money saving ideas for Christmas and gift giving. These aren't your typical “hit up the sales” ideas, but rather suggestions that come from the heart to spread true joy around the real meaning of Christmas.
Are you voting with your values, but unknowingly investing against them? In this episode, Bob and Shawn uncover the importance of aligning your financial decisions with your Christian beliefs, particularly when it comes to voting one way but maybe investing another way. Discover how you can vote and invest in harmony with your Christian faith by choosing to invest in companies that align with your Biblical values, such as pro-life and pro-family. If you are voting this way, then shouldn't the way you invest also align with these principles? In today's modern financial world, it's actually quite easy to invest in alignment with their values through Biblically Responsible Investing.
Are you ready to take control of your financial future with a DIY approach? In this episode, Bob and Shawn guide you through 10 essential steps to effective financial planning, all from a Biblical perspective. Don't find yourself unprepared for the future by not preparing now. Whether it's discovering which stage of retirement you might currently be in or you just need to sit down and develop clear financial goals, this episode can help you discover how to manage your finances wisely.
Are you tempted by the allure of quick riches? In this episode, Bob and Shawn uncover the dangers of fast money, while exploring why sudden wealth can lead to reckless decisions and financial ruin. They also discuss how to align your financial journey with Biblical wisdom. The Bible repeatedly warns against the pursuit of wealth through dishonest or unwise means. Instead, create a comprehensive plan focused on long-term goals rather than short-term gains. The key is to avoid the temptation of “fast money” and instead focus on faithful stewardship of one’s resources.
What does the Bible really say about retirement? Retirement is actually mentioned only once in the Bible, where it refers to the Levites retiring from their regular service at the age of 50. However, the Bible emphasizes the importance of work around 500 times, with work being part of God's original design for humans. Retirement, as we understand it today, is a cultural concept rather than a Biblical one. In this episode, Bob and Shawn explore how to align your retirement plans with a Biblical perspective, focusing on service, purpose, and finishing life. Retirement should not be solely focused on personal interests and agendas but should be about glorifying God and serving Him.
Are you making financial mistakes that could jeopardize your future? In this episode, Bob and Shawn uncover common pitfalls like overspending, relying on debt, and ignoring the importance of a solid financial plan. Some of these common financial mistakes can happen without a second thought, while others require more planning but can still catch the best of us off guard. Being aware of these common financial mistakes is the first step in allowing you to better avoid and plan for the future. Join us as we explore how to align your finances with Biblical wisdom and secure your financial wellbeing.
Are you curious about the real story behind those free steak dinner invitations for annuity seminars? In this episode, Bob and Shawn uncover the benefits and risk of annuities and why you should be cautious when attending those enticing events. After comparing both sides - the risks and benefits of annuities - listeners will be better prepared to make an informed decision concerning annuities as an investment option. As always, it is important that listeners do their own research, while also being cautious of deceptive annuities' sales practices.
Have you ever wondered if investing in gold is truly a safe bet for your financial future? Is gold really the ultimate hedge against inflation and economic instability or are there hidden risks and downsides that you need to know about? In this episode all about gold, Bob and Shawn uncover the historical significance of gold, delve into the real risk and returns, and explore the Biblical perspective on gold as an investment. Overall, it's important to work with a fiduciary financial advisor to tailor one's investments to their goals and risk tolerance.
Are you constantly chasing the next big investment opportunity? Do you never feel content with your current financial situation? Financial FOMO, or the fear of missing out, can trap us in a cycle of dissatisfaction, envy, and greed. In this episode, Bob and Shawn expose the dangers of the “Financial FOMO” mindset. Unfortunately, companies and media use financial FOMO to manipulate consumers into overspending and taking on debt. The antidote we recommend? Finding contentment in Christ, practicing gratitude, and focusing on reasonable returns rather than chasing the latest trends to help try and live a more fulfilling and financially stable life.
Click below to listen to Episode 205 – Financial FOMOFinancial FOMOCheck out these tips on how you can try and overcome the financial fear of missing out.
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Are you constantly chasing the next big investment opportunity? Do you never feel content with your current financial situation? Financial FOMO, or the fear of missing out, can trap us in a cycle of dissatisfaction, envy, and greed. In this episode, Bob and Shawn expose the dangers of the “Financial FOMO” mindset.
Unfortunately, companies and media use financial FOMO to manipulate consumers into overspending and taking on debt. The antidote we recommend? Finding contentment in Christ, practicing gratitude, and focusing on reasonable returns rather than chasing the latest trends to help try and live a more fulfilling and financially stable life.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodePHILIPPIANS 4:11-13Not that I speak from need, for I have learned to be content in whatever circumstances I am. I know how to get along with little, and I also know how to live in prosperity; in any and every circumstance I have learned the secret of being filled and going hungry, both of having abundance and suffering need. I can do all things through Him who strengthens me.
HEBREWS 13:5Make sure that your character is free from the love of money, being content with what you have; for He Himself has said, “I will never desert you, nor will I ever forsake you.”
ECCLESIASTES 5:10He who loves money will not be satisfied with money, nor he who loves abundance with its income. This too is vanity.
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EPISODE TRANSCRIPTShawn:
Are you constantly chasing the next big investment opportunity? Never feeling content with your current financial situation, financial, FOMO, or the fear of missing out can trap us in a cycle of dissatisfaction, envy, and greed. In this episode, we’ll expose the dangers of this mindset and uncover biblical truths that lead to true contentment in Christ no matter our circumstances. Let’s get some perspective. Welcome to another episode of Christian Financial Perspectives. We’re so glad that you’ve joined us today as we dive into financial FOMO, and I don’t know if you’ve ever heard of the term FOMO before, it means fear of missing out, but then there is financial FOMO, which we’re going to get into. Bob has graciously put a definition into our outline. Financial FOMO reflects the psychological aspect of investing where individuals are influenced more by emotions and the fear of missing out on market returns than by objective numerical analysis.
Bob:
Pretty good, huh?
Shawn:
End program.
Bob:
I think about, I guess it was just four or five years ago, and you knew when we started the podcast, Mary Jo helped me do it and we had a program way back that we did FOMO, and I was like, what’s FOMO? I didn’t even know what FOMO was, and now it’s become such a popular term and it’s very popular in the social media area as well. So you picked a really good scripture here. I like Shawn.
Shawn:
We actually have three scriptures for today.
Bob:
You have three of them today. Okay. Why don’t you read the first one? I’ll read the one in the middle and you catch this last one.
Shawn:
Sounds good. Well, first we’re going to start with Philippians 4:11-13. All of these are from the NASB if someone wants to read it for themselves, but Philippians 4:11-13, “Not that I speak from need, for I have learned to be content in whatever circumstances I’m in. I know how to get along with little, and I also know how to live in prosperity. In any and every circumstance, I have learned the secret of being filled and going hungry, both of having abundance and suffering need. I can do all things through him who strengthens me.” And this passage really, to start us out, really helps to emphasize the importance of finding contentment in Christ regardless of our financial circumstances.
Bob:
Boy, that scripture really goes good with the fear of missing out. The next one is Hebrews 13:5, “Make sure that your character is free from the love of money, being content in what you have, for He himself has said, ‘I will never desert you, nor will I ever forsake you.'” Yeah, it’s true. This passage reminds us to really find contentment in what we do have, not what we don’t have, and to trust in God’s provision and presence in our lives. And rather than constantly seeking more and more money, more possessions.
Shawn:
That’s right. And the most common thing that I hear people say sometimes is, “Money is the root of all evil.” It’s like, well, no, no, that’s a misquote. It’s, “The love of money is the root of all kinds of evil.” Not all evil, but all kinds of evil. And so we see, and I have one more scripture please, Ecclesiastes 5:10 that also again says loves money or love of money, “He who loves money will not be satisfied with money, nor he who loves abundance with its income. This too is vanity.” This verse highlights the futility of constantly pursuing wealth and abundance as it will never bring true satisfaction or contentment. So there’s nothing wrong with money and wealth in and of itself, right?
Bob:
Yeah.
Shawn:
The problem comes in your heart. If you are seeking money for the sake of money, if you are seeking money for the sake of more possessions or things, even if you get it, you’re still not going to be happy. That’s the issue.
Bob:
It’s always going to be a little bit more in it. Yeah. When I was thinking about FOMO and financial FOMO,
Shawn:
Or F-FOMO,
Bob:
I mean I know it’s like FOMO, what does that FOMO mean again – fear of missing out. And I came up with lots of examples as I was thinking about this. I actually came up with 10 of them. The first example I see being that we’re in the financial advisory business, I see the fear of missing returns.
Shawn:
So chasing returns.
Bob:
Chasing returns, chasing returns is one of the examples of financial FOMO and always trying to buy those stocks or ETFs that everyone else seems to be buying. And it’s usually after, not before, they’ve appreciated beyond reason for the fear of missing out. It’s like, “I’ve missed, now I’ve missed this. I better go get in because it’s going to continue to go.” And boy, the media just plays into that.
Shawn:
By the time you heard about it, it’s probably already appreciated about as much as it will, and that’s just the way it works. So number two, switching advisory firms, changing advisory firms every few years due to fear of missing out.
Bob:
As I was thinking about this, switching advisory firms too, and I had an example, was occasionally, and by the way, it happens about every three or four years you have this timeframe. I don’t know where it’s the stars are aligned right or barometric pressure or what. You’ll have 1-2% of your client base that will start saying, “Well, I need to go find another advisor.” And other advisors are experiencing the same thing, because we’ll gain clients from an advisor that we’ll lose other clients to. And it’s like no one’s gaining anything.
Shawn:
There’s been a couple times, Bob, I remember we had a client leave for an advisor and there was a client that came to us that actually came from the same advisor.
Bob:
No, no. That’s what I’m saying.
Shawn:
They just swapped.
Bob:
Yeah, you swapped. No, that’s not just a couple of times. That’s happened many times.
Shawn:
Well, you’ve been around longer than me. I was saying specifically I remember it happening.
Bob:
My small town. Well, I say that. It’s not the small town of New Braunfels anymore. It used to be. But that happens and it’s interesting. It’s like that grass is better over there.
Shawn:
On that. It’s not that you can never switch advisory firms, right?
Bob:
Of course not.
Shawn:
What we’re talking about more is the every three to four years something, but we understand that maybe you were with a firm when you were younger, and as you’re maybe getting in your forties or fifties and you’re looking more towards retirement, if you feel like the firm you were with is not capable of helping with that, then okay, maybe you look for another one. We get it, but you’re better off not changing too often.
Bob:
That’s right.
Shawn:
So anyway, that’s kind of the point on that one. Number three, comparing your situation to others.
Bob:
Oh boy, that’s big FOMO, isn’t it?
Shawn:
A little bit, yeah. No matter how in tune we are with the Lord that is, I feel like, always a struggle.
Bob:
There’s always not…
Shawn:
…
Bob:
There’s always going to be somebody that has more, unless you’re Elon Musk or Warren Buffet, or…
Shawn:
Unless you’re on the top of the list.
Bob:
And you’re that top 5 in the world. I mean, there’s always going to be that you’re trying to compare, and you need to just stop it. Stop that. I mean, that is such an example of FOMO and fear of missing out.
Shawn:
And when you constantly do that, it leads to dissatisfaction and envy.
Bob:
Which takes us to the next point. Comparing also causes coveting, right?
Shawn:
So number four, coveting what others have or seem to be getting.
Bob:
And that’s the last of the 10 commandments. You’re not supposed to covet what others have, and that’s really desiring those possessions and lifestyle or financial success of others, and that can lead to resentment and inadequacy.
Shawn:
And you also don’t know, again, when it seems like someone is getting all this, well, what you don’t know in most cases, are they getting these things by putting it on the credit card that they’re not going to pay off in full before the statement, before the due date. Are they borrowing money from an equity loan or line of credit from their house? You don’t know. But even if they are not having to borrow money for it, you still shouldn’t focus on it. Focus on what the Lord has entrusted you with and manage it well.
Bob:
When I was talking to Rachael about this morning, she was mentioning that that FOMO gets people in high debt.
Shawn:
Yeah. Which goes right to number five, which is financial FOMO can result in becoming greedy. You end up having this constant pursuit of more wealth and possessions, and it leads to a greedy and selfish mindset where you prioritize the material gain over other important aspects of life, like your relationship with the Lord, your family. I mean, what kid would ever say as an adult, “Oh, I wish my dad or I wish my mom had spent more time in the office to buy us stuff instead of all the quality time that we got to have together.”
Bob:
Yeah. Well, like I mentioned a few podcasts back, you’ve never met a person on their deathbed that says, “I wish I had have spent more time making making money,” but they wish they’d spent more time. You can’t replace time with your family. And I think, see, this leads right into that next one.
Shawn:
You did really good on this one, Bob.
Bob:
Thank you.
Shawn:
Leads right into the next one.
Bob:
Well, number six, not exactly in this order, but I redid the order this morning before we made this. So, it leads into hurting relationships.
Shawn:
Financial FOMO hurts relationships,
Bob:
It strains them, it constrains them with friends and family and loved ones, because you’re constantly focusing on what others have and focusing on what you don’t have.
Shawn:
Instead of the people in your life. So number seven, financial FOMO results in a need for more and more control.
Bob:
I’ve seen this, Shawn, I’ve really seen this. Some people, they just need that control of everything and you need to let go and let God. And it’s that fear of missing out can lead to a desire to control every aspect of your financial life really causing a lot of stress and anxiety.
Shawn:
Yeah. It’s the same reason why we always encourage our clients and would encourage anyone watching or listening, if you do have investments and you have a professional financial manager that’s managing that for you, do not look at it every day. I would say, at most, look at it once a month because you are dealing with a year’s timeline, not a next few months, not this quarter. And so, fluctuations are normal. Don’t focus on having to control and worry about that all the time because it’s just going to cause you stress and anxiety that you don’t need.
Bob:
So I want to go into this number eight. This is an old saying. Many of us have heard our whole life, especially if you have ever been around ranching, because cows have a real tendency to do this. Financial FOMO tricks you into thinking that the grass is always greener somewhere else. I’ve seen cows get out of the pasture as. I did work on a ranch in my younger years and my grandfather was a big rancher, and they get outside the fence and they’re kind of like, I kind of want back in because they get mixed up when they get out and they don’t know where they are. But that mode of thinking will really cost you.
Shawn:
Yeah. Well, and that goes very much against what scripture tells us in that wealth gained quickly is quickly lost, but gained little by little lasts. I know I’m paraphrasing a little bit, but that’s the point, is that true wealth, financial wealth, I don’t mean true wealth like spiritual, but building wealth in this life, it comes down to little by little. There’s not some magic bullet or something else that’ll just, “Oh, you do this one trick, and financial advisors hate this one trick.” No, it’s little by little. I mean, how many clients have we dealt with over the years? And especially you, because you’ve been doing this longer than me, where you’re some of your wealthiest never made that much money as a household during their career, but they’re multimillionaires because they lived within their means. They saved and invested consistently. They didn’t constantly look for something somewhere else, and they stuck to the plan. So then when they retired, they were prepared.
Bob:
Which goes into number nine. They don’t have a jumper mentality. They don’t jump around. They don’t think the grass is greener and they don’t start jumping around like a rabbit trying to figure out where they are. They stick to it.
Shawn:
So financial FOMO causes a jumper mentality.
Bob:
Yes.
Shawn:
Which we don’t want.
Bob:
Yeah, exactly.
Shawn:
Then number 10.
Bob:
Number 10, yeah.
Shawn:
Financial FOMO can rob you of contentment and happiness.
Bob:
Oh, big time. Big time. It can lead to a constant state of dissatisfaction with what you have and unhappiness. You’re always seeking the next best thing. So as I was doing this, I said, okay, these are these 10 ways. I said, how is it used today? Because what’s kind of sad in all this is that companies and people use FOMO to their advantage, their financial FOMO…
Shawn:
To get people to do what they want from a financial perspective.
Bob:
So you go into that first one.
Shawn:
So number one, commission-based advisors, they use financial FOMO to sell high commission financial products like gold and annuities.
Bob:
They convince you if you don’t do this, you’re missing out, and they try to make you think you’re not very smart.
Shawn:
And you know what Bob? They are right. If you don’t do this, you’re missing out on a bad investment.
Bob:
Yeah. That’s true. The second one is the media. The media is constant. They’re using financial FOMO through advertising to entice consumers to spend money on products and services that they really don’t need, “But if you don’t have this, then you’re not going to get this.”
Shawn:
According to a certain car manufacturer around Christmas time, you’re supposed to buy your spouse a new car with a big red bow on it.
Bob:
Yeah. I’ve seen that.
Shawn:
Wait, we’re not going to mention it cause I don’t want them to get mad at us. Number three, entertainment. Programs like HGTV can make you feel like you’re missing out on the perfect home or renovation.
Bob:
I’m always saying, whatever color it is today, it’s going to change in two years. If you go spend all money because you feel like, “I’m missing out. My home needs to look this way because all the homes on HGTV look this way.” As soon as you get it all paid for, it’s going to change in two years, so just wait long enough, it’ll come back. Whatever you have right now, the colors probably would just come back.
Shawn:
Yeah. I mean, if the paint’s peeling or something, sure, you can reduce the maintenance, but you don’t have to change the color everywhere.
Bob:
Yeah. But I’ve seen so much of that. I mean, you’ve got a perfectly good granite countertop. Well now if it’s a certain color in granite, you’ve got to go get another color in granite or you got to get the stone. You’ve got to get something different, and that’s entertainment and they try to convince you of that. And I think HGTV, many times, is sponsored by all the vendors that sell the stuff.
Shawn:
That’s weird. Yeah. You see this thing about all these paint changes and the new countertops, and then they’re sponsored by “fill-in-the-blank paint company” and this stone or masonry group that that’s…Oh weird, right? So number four.
Bob:
Oh, this is a big one. I see the number one financial website, it’s probably CNBC, and then there’s Yahoo Finance and Google Finance. But these channels really use financial FOMO a lot to keep their viewers engaged and constantly seeking the next big investment opportunity. And they make you feel like a fool because they’ll say, “Such and such, this week was up this much or this month was up this much,” and they make you feel like, “Well, I’ve just missed out. I better go get into that before I miss out anymore.”
Shawn:
I don’t want to miss out on the next week.
Bob:
It kind of goes back to what we were talking about at the very, very beginning, but companies do this and of course number five is the big one. That was the one that my wife gave me the idea of this morning. Just the credit card companies and lenders.
Shawn:
Right. They use financial FOMO to make you their slave by encouraging overspending and taking on debt. They often promote a lifestyle that is beyond your means, leading to a cycle of debt and financial stress. I mean, the most common thing I’ve seen with credit cards is if you’ve been doing good with actually paying things off and you’ve got a good credit score, “Oh, well, would you like to increase your limit? You’ve actually been approved to increase your limit.” Well, if you’re spending what you need to spend and you’re making sure to stick with your budget, why would you need a higher limit? That doesn’t make any sense.
Bob:
It’s interesting, Shawn.
Shawn:
You’re just asking to get sucked in and spend more than you should be spending.
Bob:
A good credit score is good. I mean, I want you to have a good credit score, but really if you’re debt free, you don’t need a credit score.
Shawn:
Yeah, exactly
Bob:
Matter of fact, if you’re totally debt free, your credit score goes down. I don’t know if you knew that or not, even though you have tremendous amount in cash reserves and savings and investments. I mean, you could have $5 million or $10 million and be totally debt free and your credit score may be 200 because you hadn’t borrowed anything, but you’re a lot better off than most people. Okay, so I thought about there’s got to be an antidote to this financial FOMO. And I’ve thought of three different areas. Go ahead and share number one.
Shawn:
Sure. Number one is find contentment in Christ, not in the size of your portfolio, the latest returns, or what others seem to be making or have. Remember that true joy and peace comes from a relationship with God, not material possessions or financial success.
Bob:
You said it well, you wrote it down well, too.
Shawn:
I did. Yeah, it does help. Don’t tell anybody we have a computer in front of us to help with.
Bob:
Oh, I they know it. The second one is I want you to find contentment in the things that you do have, not in what you don’t have. Practice gratitude. Even say every day, “Lord, thank you for those things that I do have.” And focus on the blessings in your life rather than constantly seeking more. Get rid of that FOMO, that fear of missing out.
Shawn:
Number three, find contentment in reasonable returns not in what the financial media is trying to convince you that you’ve somehow missed out on.
Bob:
Can you see that a financial advisor wrote that? Yeah, I wrote that and I’ll say right now that reasonable returns are what we aim for around here. I’m not trying to hit home runs and get strikeouts. I’m trying to hit base hits.
Shawn:
If you’re looking at investment management purely from a performance standpoint, it’s very easy to get sucked into, “What is the return? I need to get the return higher.” But if you set realistic financial goals and you stick to a well thought out investment strategy rather than chasing the latest trends or hot investments, you’ll do well in the long run. I think a great example is if your average return is say 5-6% and you’re looking at your financial planning and for when you retire and then in retirement, okay, I’m hitting all the numbers for income that we’re going to need based on the plan. Great. Well, okay, maybe somewhere else there’s a 7% or 8% or a 10%, but does it really matter? If you’ve set out the goal and this is what you’re trying to do or if you have that goal of this is what I want to do in retirement, the Lord’s calling me to, it doesn’t really matter if you might be able to have a better return somewhere else if you’re on track for those goals that you’ve set.
Bob:
You said it perfectly and you’re going to have to take more risks to get those higher returns, too.
Shawn:
Yeah, exactly.
Bob:
I mean you have to. Risk and reward go hand in hand.
Shawn:
So in conclusion.
Bob:
In conclusion, yeah.
Shawn:
If we commonly accept the will of God for each one of us and accept changes in life, we’ll not be bothered by the severe or the constant obsessive fear of the financial fear of missing out.
Bob:
Amen. Let’s find our contentment in Christ and nothing else and focus on the blessings that are in our lives and overcome the negative effects of financial FOMO and live a more fulfilling, financial, stable life. I think that says it perfect.
Shawn:
Thanks as always for joining us. God bless. If you have any comments or topics or anything else you want to share, we’d love to hear from you. Comment, send us a message on our website, www.ChristianFinancialAdvisors.com or call or text us at (830) 609-6986. Until next time, thank you and God bless.
[CONCLUSION]
That’s all for now.
We invite you to listen to all of our past episodes covering many financial topics from a Christian Perspective. To make sure you don’t miss any of Bob’s upcoming episodes you can subscribe to Christian Financial Perspectives on iTunes, Google Play Music, Spotify, or Stitcher. To learn more about integrating your faith with your finances, visit ciswealth.com or call 830-609-6986.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 204 – Budgeting Without CountingBudgeting Without CountingLearn how to budget in a simpler way.
More episodes >>
Feeling overwhelmed by the constant need to track every penny? Does the thought of budgeting and counting numbers fill you with dread? Bob and Shawn reveal a simple approach to managing your finances without the hassle of traditional budgeting. You’ll learn how to gain control, reduce overspending, and aim to achieve your financial goals all without the burden of counting.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodeLUKE 14:28-30For which of you, intending to build a tower, does not sit down first and count the cost, whether he has enough to finish it— lest, after he has laid the foundation, and is not able to finish, all who see it begin to mock him, saying, ‘This man began to build and was not able to finish’?
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EPISODE TRANSCRIPTShawn:
Feeling overwhelmed by the constant need to track every penny? Does the thought of budgeting and counting numbers fill you with dread? Well, in this episode, we’ll reveal a simple stress-free approach to managing your finances without the hassle of traditional budgeting. You’ll learn how to gain control, reduce overspending, and achieve your financial goals all without the burden of counting. Let’s get some perspective.
Welcome back to Christian Financial Perspectives. So glad that you’ve joined us. My name’s Shawn Peters. I’m joined as always by Bob Barber, and today we’re getting into budgeting without counting. So for those of you who hate even holding or looking at a calculator or somehow it feels like when you try to budget, you’re just putting too many constraints on yourself and rules and you’re just a free spirit or something like that, I don’t know, whatever it might be. Well, today we’re going to present a plan to help you be able to budget, but in a way that avoids the counting and looking at counting very specific budget categories, if you will.
Bob:
It’s the cost of counting and numbers. And Shawn…
Shawn:
You’ve been doing this with you and Rachael, right? For many years.
Bob:
Rachael and I have been using this method for a good 15, 16 years, and it works very well. I’m the numbers guy. You know how opposites attract, right?
Shawn:
Yes. Bob loves to budget with counting.
Bob:
I love budgeting and accounting. My wife, if you want to get into an argument, you start talking about budgeting and counting. And I will say this, Shawn, from the many years of doing this with couples, there’s usually one that likes to do that and the other that doesn’t, or sometimes there’s both. They just can’t seem to budget correctly. There’s a little bit of counting that is involved in this in the beginning, but once you get past that, really you can let the app do it and it’s going to take care of it for you. It is amazing how well it works. And so people, I want you to, if you’re not driving and you happen to be at home, you might want to get out a notepad and write down some of this information. I’m going to give you some really great information today.
Shawn:
And really the strategy, the intent here is to help you gain control of your finances, but without the stress of having to constantly monitor your accounts.
Bob:
Yeah, that’s right.
Shawn:
But before we go any further, Bob, let’s go ahead and read Luke 14:28-30, “For which of you intending to build a tower does not sit down first and count the cost, whether he has enough to finish it, lest after he has laid the foundation and is not able to finish, all who see it began to mock him saying, this man began to build and was not able to finish.”
Bob:
Goes with budgeting, doesn’t it?
Shawn:
This passage really emphasizes the importance of planning and being wise with our resources. So, with the scripture out there, let’s go into step number one, which is determine your monthly expenses.
Bob:
There about four steps here, I believe? Four or five?
Shawn:
I believe so, yes. I believe we have four steps total.
Bob:
That is the first thing that you have to do. Yes, there is a little bit of counting upfront. Sorry, but I know we said budgeting without counting, but there’s got to be some upfront.
Shawn:
Budgeting with minimal counting. And it’s more so of initially.
Bob:
Yep. You’ve got to look at what your monthly expenses are and crunch those numbers to determine what your family can live on after taxes, savings, and giving.
Shawn:
That’s an important thing. After whatever taxes, savings, and giving you’re going to do and put into that plan, then what do you need to get by?
Bob:
And the normal month, of course has four weeks. Now we know there’s 30 days in a month. So on average you have to kind of compensate a little bit for that. Maybe day 8 or day 9, instead of day 7, 14, it might be 15, but you get the gist of it. Think about budgeting in four week increments. You think about basically eight or nine different things, and that is things like groceries, clothing, housing, utilities, that’s your electric, water, sewer, garbage and gas. Your transportation costs, like your car and upkeeping. Medical costs, insurance, which has to do with your home, auto, life, and disability. And then those miscellaneous costs like eating out and clothing and…
Shawn:
Just the non necessary clothing.
Bob:
Well, that’s true. That’s true.
Shawn:
Yeah, because there’s clothing, but that’d be more for the, well, I don’t need it, but I kind of want to get that new fill in the blank.
Bob:
Well, you can with this system that we’re going to talk about and how to crunch these numbers. But you have to figure this out first. You’ve got to figure out what can we live on. Now, if you’re making a 100k a year and your expenses are this is 120k, you’ve got a problem. But you know what I find, Shawn, is that most people, when they actually look at the numbers, they come in less.
Shawn:
But be sure when you’re looking at these, what do you need for the essentials that we’ve just listed? Make sure you include any debt payments, so credit card bills, student loans, things like that. Also, don’t forget to factor in things that are a little more infrequent. So at least annual change of oil in the car, things like that. Home repairs or gifts for Christmas for example, because that creeps up on people all the time.
Bob:
And we are, the way we’re going to talk about this, we’re going to have savings as a complete other category. Which has to do with the emergency expenses.
Shawn:
That’s right. So for the example budget today, we’re going to use a hundred thousand a year. It’s nice math. It’s a good number to start with.
Bob:
You can take 70% of these numbers and it’s 70.
Shawn:
Exactly. So at a 100,000 a year, that’s about 8,100 a month.
Bob:
That’s correct.
Shawn:
We did step one, which determined your monthly expenses. So now in step two, we’re going to break down your monthly expenses into weekly amounts.
Bob:
So we’re going to break that down by four weeks. The first is usually your most, because that’s at the beginning of the month. You have your heavier things like your mortgage payment, maybe your car payment. You got your utility bills that are usually due at the beginning of the month. So out of this $8,100, we determined, and this is very realistic, about $3000 of that — if you took the $8,100 and divided it by four, you’d be at $2,050 per week. But the first week’s going to take about $3000 of that because of the bigger bills that come up front. So what this means is, and we’re going to get into the next step, step three, you’ll see how we do this. But that means in that first week, all you’re going to spend is $3000 and we’re going to show you a way that it makes it impossible to spend more.
Shawn:
Right. So this leaves us with $5,100 for the next three weeks divided by three is $1700 a week.
Bob:
That’s correct.
Shawn:
So of course adjust these numbers based on your specific situation and when your bills are due. So I know for example, Jenna and I, we both have our mortgage payment that goes out on the 12th or as early as the 10th, depending on what day that falls on. And with our credit card bill, I think it’s on the 12th as well.
Bob:
So y’all may fall into week two of this. You may fall into a lesser on week one and the most on week two in y’all’s case. Okay.
Shawn:
So again, adjust it, but effectively you need to have that one. Or you can kind of look at it as well, we’re starting week two as our week one, but whatever the case is, just kind of keep on that consistent schedule when your paychecks come in and then move on from there.
Bob:
Now this is the first two steps, and that’s all the counting you got to have to do. I mean, that’s pretty much it.
Shawn:
From here on out, no more counting.
Bob:
But from here on out, we’re going to talk about a strategy that has worked so well in my own personal life. And I’ve talked this strategy to many of our clients and they absolutely love it. So here we go. Step three.
Shawn:
Step number three, set up two different bank accounts. So bank account number 1, strictly for depositing paychecks, paying taxes, you’re saving, and you’re giving. Never use this account for general spending.
Bob:
That’s never, ever, ever.
Shawn:
And we’ll say that multiple times.
Bob:
But you never take anything else from account number 1. That is so important.
Shawn:
Depositing income, paying taxes, putting money into savings, or giving. That’s it. That’s the only thing used for it. Now then bank account number 2, strictly for paying all your regular monthly expenses as we previously determined in step number one. So, having these two separate accounts helps to create a psychological barrier as well as technically to an extent there is a barrier in two separate accounts. But the biggest thing is when you have them in two separate accounts, it helps in your mind to be able to separate income and expenses. So you don’t look at your one account is very common for most people. You have your one checking account, that’s where everything goes into it.
Bob:
Everything comes in and everything goes out.
Shawn:
So when you’re trying to decide, “Oh, should we get this or do we need it or can we afford it?” You go, “Oh, look how much is in there?” But you very quickly forget, “Oh wait, what about this bill that’s coming in? What about this one? Oh, we also have this for giving that goes out to the church.” And so you’ve got to have those two separate accounts. That’s a big part of this.
Bob:
And preferably, Shawn — now this has worked well for Rachael and I — we have the accounts in completely different locations, too.
Shawn:
You’ve got one at a good local bank and then you have one at your good credit union.
Bob:
That’s the way it is with us.
Shawn:
Around here, we’ve got Frost and Randolph. So that would be the R-B-F-C-U.
Bob:
Any way you want to do it. But I think the best thing that you can do is actually setting this up in two separate accounts, two separate banks. I don’t want you looking at what’s in the bank account Number 1 that the income goes into. You have determined what your expenses are and then divided that by four and those first two steps, and then that’s going to come over. And the way that this works is you go to, and you’re looking at your account every day. Everybody has an online app. Everyone.
Shawn:
One thing to help on this is consider setting up automatic transfers when you already know what your paycheck’s going to be and the income, you know what the tax is and saving and giving, go ahead and set up the automatic transfers so that way whatever is supposed to move from bank account number 1 to number 2, happens automatically. You’re not checking it or decide, well this month I’ll do $3,500 to move over. No, nope, you got to stick to it.
Bob:
You do not do that. You do not do that. And the thing about this, so in this case, we were using $3,000 in the first week.
Shawn:
This gets us into step number four.
Bob:
Okay.
Shawn:
Transfer money from the bank account number 1 to bank account number 2, week one, you would, in using our example, transfer $3,000 from bank account number 1 to bank account number 2, no other funds should be transferred from bank account number 1 to number 2 until the next week.
Bob:
Well, what if I run out of money in day four, no more out? That’s exactly right. See, that’s the power…
Shawn:
You’ve already got the important things covered.
Bob:
That’s the power behind this. The power behind this is separating out the accounts. You’ve determined what you need on a weekly basis and you stick by it and you can look at that app every day and see what you’ve got. And if you are out of funds in day five or day six, you got to wait maybe one or two more days until the next part comes in. When you do it otherwise, any other way, it may look like I’ve got plenty, I still got a lot in there for the rest of the month. But then at the end of week two and a half or three weeks, you have nothing left. And then you have to go a whole week instead of a couple of days. I mean, this is extremely powerful. I’ve used it for so many years and man it works.
Shawn:
So at the end of that first week going into day seven or eight, you have the other $1700 transferred, and then just stick to the schedule for all four weeks.
Bob:
I mean, we live around this, Shawn, because Rachael, like you say, she doesn’t like budgeting or having to count all those numbers. And most people don’t. And she knows, okay, in week two, that’s when I can go buy more groceries or we can go, if we’ve already eaten out and used our budget by the fourth day of week one, we got to wait to week two. And same with each week. It keeps you right on schedule. And we’ve lived on the same amount, even with inflation, we’ve lived on this same amount pretty much for 15 years. We’ve been doing this even though my income kept rising, but I kept transferring over the same amount. And so I added that to savings and investing and giving.
Shawn:
Okay, that’s where the, well, what if something comes up in that second or third week that was not a, “Oh, I’d like to buy this or pay for it,” but there’s actually some sort of emergency. That’s when you would look at pulling from savings, if it’s truly an emergency.
Bob:
If it’s truly an emergency, an emergency is not a new car unless the other car has completely fizzled out. An emergency is not a new set of clothes. Emergency is an emergency. It is like for medical.
Shawn:
Or the AC completely broke and it’s Summer.
Bob:
That’s right. But by doing this this way, you will build up your investing and your savings accounts. And by giving from that account too, you’re giving from the gross, which is what God wants you to do.
Shawn:
That’s right. So which kind of leads right in, naturally Bob, to our benefits of budgeting without counting.
Bob:
Okay, learn to live on the same amount month after month, regardless of increasing income. You’re not always pushing more and pushing more. You’re determining how much is enough. We preach that around here. How much is enough?
Shawn:
That’s right. It gives, builds savings, invests extra money as your income increases, which is a big benefit.
Bob:
Number three is a big one, too. It definitely reduces the financial stress, especially if one of you is a budgeter like myself. Rachael doesn’t have to worry about counting the numbers. I’m looking at that. I’m looking at the account online. She looks at the account online. And some of you say, well, you don’t want to go look at your account online. The thieves are looking at the account online. And those that are looking to get into the bank accounts, you need to be monitoring your financial accounts often. I like to do them daily or weekly. Now if you have investing, don’t get caught up in looking at what the data says.
Shawn:
Yeah, we’re talking about the bank account, we’re not talking about the investment account.
Bob:
That’s right.
Shawn:
And Bob, one of the things is, again, since usually there’s one spouse is one way and you have the other way, but for you, I know you like to keep an eye on things, you like to be more in it and looking at all the numbers and Rachael doesn’t. Well, that’s very common with a lot of people. So this satisfies your need on the, “Well, I want to make sure that we’re staying with where we need to be. We’re staying on track.” But it allows someone who doesn’t like that to feel like they have a little more freedom where they’re not having to discuss and talk about every single little thing. “Well, what about this? Why’d you get this?” Well, it doesn’t matter. If you’re sticking within that budget, it doesn’t really matter if you spend a little more on clothing this time versus eating out.
Bob:
That’s exactly right, Shawn. It avoids arguments.
Shawn:
And then it encourages discipline and mindfulness in our spending habits. That’s a good one too. So, alright, well Bob, I’ll let you cover this part on personal experience since you’ve been doing this for so long.
Bob:
Well, I kind of have already. We set up this process many years ago because my wife, she doesn’t like counting and numbers. If I gave her a calculator, she might throw it back at me. So we’ve been married 40 years, we’ve been using this system for 15 to 20. It works extremely well. I’ve taught multiple clients how to use this system and it is very successful with them. It absolutely works. And like I say, many people have found success with this, even if they struggle with the traditional envelope budgeting system – constantly counting, you just got to break it down by the week.
Shawn:
So in conclusion, the importance of having two bank accounts cannot be stressed enough.
Bob:
No, it cannot.
Shawn:
You’ve got to have two different bank accounts for this to work. And again, we encourage you to have it at two different banks or institutions. It could be one credit union, one bank, but having that separation helps a lot because if they’re both the same bank and your name is on it or you and your spouse’s names are on it, well it’s just real easy to hit transfer from this account to this account. But when you have them at two different banks, they’re not automatically connected.
Bob:
And the thing is, is when you have it in two different institutions, also, it allows a couple extra days.
Shawn:
Yes, yes, that too.
Bob:
And so it’s really putting a wall between them because like you say, if you have it in the same bank account, you can transfer it instantaneously anytime. We don’t have enough now for another two days or three days. Well no, this helps you stay disciplined.
Shawn:
That’s right. It’s like drinking the water out of a straw versus a fire hose.
Bob:
Yeah, amen. It is.
Shawn:
Which causes a lot of waste of resources, but also just makes it a lot harder to get it done. If your choice is drink it from the hose at full blast , well you might just end up not drinking water.
Bob:
You’re also going to get a lot more wet, too, from doing that. So by implementing the strategy that we’ve talked about today, you can take control back of your finances, reduce stress, and work towards good, long-term financial goals. It’s really going to help a lot on the saving for emergencies and the investing and of course your giving as well, which I feel that the giving needs to be first.
Shawn:
Agreed. Alright, well that’s it for today. Thank you so much for joining us. God bless. And as always, you can reach out to us. Call, Text (830) 609-6986. You can also visit our website www.christianfinancialadvisors.com. Thank you and God bless.
[CONCLUSION]
That’s all for now.
We invite you to listen to all of our past episodes covering many financial topics from a Christian Perspective. To make sure you don’t miss any of Bob’s upcoming episodes you can subscribe to Christian Financial Perspectives on iTunes, Google Play Music, Spotify, or Stitcher. To learn more about integrating your faith with your finances, visit ciswealth.com or call 830-609-6986.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 203 – 10 Biblical Investment Principles10 Biblical Investment PrinciplesExplore 10 powerful Biblical principles to help guide you in your financial journey.
More episodes >>
Are you tired of feeling lost in the world of investing? Unsure of how to navigate the ups and downs of the market? In this episode, Bob and Shawn explore 10 powerful Biblical principles that will guide you towards wise, faith-based investing decisions and help you stay focused on your long-term goals.
Some of these areas include making investment decisions based on facts and math, rather than emotions or hearsay. Investing is a marathon, not a sprint, and should be viewed through a long term lens in order to create a well thought out financial plan.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodeEcclesiastes 11:2Invest in seven ventures, yes, in eight; you do not know what disaster may come upon the land.
PROVERBS 7:7I saw among the simple, I noticed among the young men, a youth who had no sense.
PROVERBS 18:15The heart of the discerning acquires knowledge, for the ears of the wise seek it out.
PROVERBS 14:15The simple believe anything, but the prudent give thought to their steps.
ROMANS 12:2Do not conform to the pattern of this world, but be transformed by the renewing of your mind. Then you will be able to test and approve what God’s will is—his good, pleasing and perfect will.
2 TIMOTHY 1:7For God hath not given us the spirit of fear; but of power, and of love, and of a sound mind.
PROVERBS 14:7-8Stay away from a fool, for you will not find knowledge on their lips. The wisdom of the prudent is to give thought to their ways, but the folly of fools is deception.
PROVERBS 13:11Dishonest money dwindles away, but whoever gathers money little by little makes it grow.
ECCLESIASTES 3:1-2There is a time for everything, and a season for every activity under the heavens: a time to be born and a time to die, a time to plant and a time to uproot.
1 TIMOTHY 6:9-10Those who want to get rich fall into temptation and a trap and into many foolish and harmful desires that plunge people into ruin and destruction. For the love of money is a root of all kinds of evil. Some people, eager for money, have wandered from the faith and pierced themselves with many griefs.
PROVERBS 21:5The plans of the diligent lead to profit as surely as haste leads to poverty.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTShawn:
Are you tired of feeling lost in the world of investing? Unsure of how to navigate the ups and downs of the market? In this episode, we’ll explore 10 powerful Biblical principles that will guide you towards wise faith-based investing decisions, and help you stay focused on your long-term goals. Let’s get some perspective. Welcome back to Christian Financial Perspectives. We’re so glad that you joined us today. We’re going to be covering a topic that I feel like we’ve hinted at many times, Bob, but never covered this specifically or in this specific way, but 10 Biblical investment principles. Bob, why don’t you give our audience a little bit of a introduction on where this is coming from, why we’re covering this today?
Bob:
Well, I can tell you this, Shawn, that it took me a while to put this together. You’ve heard me say sometimes I can put together a program in literally 10 or 15 minutes. This one took me more like two or three days because I wanted to make sure I was getting it right and I was really thinking about how should we apply Biblical principles to investing, which, you know and I know we’ve talked about Biblically responsible investing so much, but this is going over the other aspects of it as well.
Shawn:
A little more, I guess you could say, how. So, how you might invest or create your own investment strategy, right? Okay.
Bob:
That’s correct.
Shawn:
Alright, well.
Bob:
So we have 10 of them.
Shawn:
We have 10 total we’re going to cover today. So Biblical investment principle number one, why don’t you go ahead, Bob, and I’ll handle the scripture.
Bob:
All right, well this is investing in a diversified portfolio of Biblically responsible companies that produce and distribute essential goods and services.
Shawn:
That’s right. And our scriptural reference for this is Ecclesiastes 11:2, “Invest in seven ventures, yes in eight; you do not know what disaster may come upon the land.” And one thing that we come across pretty frequently, Bob, when we say invest in BRI companies, well what that really means, for those of you listening are watching, are not only invest in Christian companies, most of the companies are not Christian, arguably most of them, I would call them neutral companies. They just focus on treating employees well, vendors well, they offer whatever their widget goods or services happen to be and they just don’t get involved in many of the contentious areas.
Bob:
That’s correct. That’s right. If they make widgets, they make widgets. They don’t get involved in all the other political jargon.
Shawn:
They’re not all Chick-fil-As and Hobby Lobby’s, for example. They’re just normal companies that don’t get involved.
Bob:
And this scriptural principle that we have in the scripture is truly diversification. Solomon’s talking to us about diversification and it’s diversifying in companies like you say, that produce and distribute essential goods and services, not “pie in the sky” kind of thinking.
Shawn:
Exactly. Exactly. Alright, so Biblical investment principle number two. Why don’t you?
Bob:
Well this is when you’re making investment decisions, make those decisions based on facts and math, not emotions or hearsay. Diversify across many sectors of the economy by company size, financial strength, and the markets that they serve, because many companies serve different markets, and avoid the day-to-day, financial media hype and the activities written by inexperienced writers and people. I mean, I’m …
Shawn:
Anybody can write an article.
Bob:
I am amazed Shawn at what I read on many of the financial websites and I go in, I dig into the writers, and the writers didn’t even major at all in finance. They majored in English, which is good. They’re writing proper English.
Shawn:
They can write really inaccurate stuff very well.
Bob:
They get the term trader and investor constantly mixed up, “Investors today are thinking…Investors the next hour are thinking…” That’s not an investor, that’s a trader, that’s not an investor. So that’s an example of it.
Shawn:
Investors deal, I would say at a minimum, on a month’s basis, not anything less than that. Anything less than that, you’re effectively day trader or weekly trader.
Bob:
So we’ve got the Biblical principles behind this for two scriptures I picked.
Shawn:
Both of these are from Proverbs. First one is Proverbs 7:7, “I saw among the simple, I noticed among the young men, a youth who had no sense.”
Bob:
That’s pretty strong, isn’t it?
Shawn:
Yeah. Well Proverbs never really holds back, does it?
Bob:
No, it doesn’t.
Shawn:
And our second one for this principle is Proverbs 18:15, “The heart of the discerning acquires knowledge for the ears of the wise seek it out.”
Bob:
Yes.
Shawn:
Yeah, so seek wise counsel would be another one.
Bob:
That’s right. Alright, so Biblical investment principle number three is avoid making irrational decisions that are motivated by greed.
Shawn:
Or hearsay.
Bob:
And stay focused on the long-term goals, not the day-to-day, what’s going on, but what is your long-term goals, and greed can get you in the wrong spot. You don’t want to let greed get you there. Because then you make irrational decisions.
Shawn:
That’s right. Then Proverbs 14:15, “The simple believe anything, but the prudent give thought to their steps.”
Bob:
Kind of sums it up, doesn’t it?
Shawn:
You’re making your decisions based on that long-term plan. So, first of all, you’ve got to sit down and make that long-term plan and figure out where you’re trying to get and by when and then that helps, kind of looking through that lens, it helps you to stay focused on that instead of worrying about what something does from one day to the next. Alright. Biblical investment principle number four.
Bob:
Do not conform and give in to overly emotional markets. The markets can get very emotional. When everyone is buying, the markets may be at all time highs and when they’re up by 10 or 20%, that’s the time to consider actually selling some off when everybody else is buying.
Shawn:
That’s right. Doesn’t mean to sell everything.
Bob:
This is usually on the tail end, too. This is usually the end of a two or three year cycle when you see everybody and their cousin, aunt, and uncle wanting to get in every 17-year-old, 15 year old is wanting to get in, everybody wants to get in the market. That’s the point when the emotions are involved in that, because everyone’s following the crowd that could be about to go off a cliff at that point. And on the opposite side of that is when everyone seems to be selling and the market’s declined by 10 to 20%, and they’re in a major valley versus a peak, that’s a great time to consider buying some and while it’s low. That is a very strong principle that has worked for guys like Warren Buffet for years. That’s what he does
Shawn:
The only time he ever consistently is in the news is you’ll hear about when the markets have not been doing well or a certain sector industry is kind of in the toilet and you’ll hear about, oh, Warren Buffet, he’s buying. He just bought such and such airline, or he just bought this energy company or shares in it. Of course. And yeah, it’s because that’s the principle that he’s been operating by for many, many years now.
Bob:
Yeah, that’s right.
Shawn:
But you never hear about the stuff he’s buying or the stuff he’s selling when everything’s at all time highs. They only bring him on when it’s all doom and gloom and they want to know what’s this crazy guy doing?
Bob:
So I wanted to make sure this scripture that you’re about to read, Shawn, I want to make sure that you understand, I don’t want to take this out of context, but when I looked at this scripture, we’ve got to be careful about just following the crowd and that’s where the first part of this scripture is really strong.
Shawn:
Gotcha. Romans 12:2 is a scripture for this one, “Do not conform to the pattern of this world, but be transformed by the renewing of your mind. Then you’ll be able to test and approve what God’s will is, his good pleasing and perfect will.”
Bob:
Yeah, it’s that first part. It’s really strong. And the last part, God wants you, I mean, I’m not a prosperity theologist, but God wants you to do well. I mean Jeremiah…
Shawn:
Well, be a good steward of what he’s entrusted you with. Exactly.
Bob:
Plans for you to do well.
Shawn:
And I would say another scripture that I know it’s normally related to salvation, but when scripture talks about how broad is the path that leads to destruction, but narrow is the path that leads to salvation. Well, it’s kind of similar when the crowd mentality is typically, “Oh, everything’s going up. Everybody wants to get in, everybody wants to buy.” And then when it’s dropping, everybody wants to get out, everybody wants to get out. And the reality is the smaller group that goes against that push, against that tide, that crowd mentality are the ones that over time can do better.
Bob:
Interesting how you can apply Biblical principles to everything in your life. Biblical principle number five, be cautious of professional fear mongerers selling their conspiracy theories to promote their high commission products like gold and annuities. It’s a very strong Biblical investment principle.
Shawn:
On one hand they will create this fear and create this problem or this perceived problem and then they just so happen to have either something they sell or someone who’s sponsored. It’s like, “Oh, you should buy from this particular gold company or this particular type of annuity.” Weird how they created the problem that you may or not have even been aware of and then already had the solution right there. And they carry very high commissions.
Bob:
And like I say, I call ’em professional fear mongerers.
Shawn:
That’s right. They profit off of it. Alright. And 2 Timothy 1:7 is our scripture for this, “For God hath not given us the spirit of fear, but of power and of love and of a sound mind.”
Bob:
I use that scripture a lot when I hear of all the fear mongerers out there. Wait a second, God didn’t give us a spirit of fear. Now we’re supposed to be wise, but we’re not supposed to walk around fearful. Okay, Biblical principle number six, remember that nothing is free. If a return sounds too good to be true, it usually is. Get rich quick schemes usually only work for those selling them.
Shawn:
And it works for them, not because of what they’re teaching, but it works for them because they were able to trick a whole bunch of people into buying their nonsense and their training courses and whatever it is that they’re selling.
Bob:
I love it when you say that, nonsense. That’s a good word that you use.
Shawn:
Yeah, it is.
Bob:
Let’s read this scripture. It goes right with it.
Shawn:
That’s right. Proverbs 14:7-8, “Stay away from a fool for you’ll not find knowledge on their lips. The wisdom of the prudent is to give thought to their ways, but the folly of fools is deception.”
Bob:
I think it clears it up. Like you say, Proverbs never holds anything back.
Shawn:
Biblical investment principle number seven.
Bob:
Not every investment will be a winner. Investing is a long-term marathon, not a short-term sprint. Investors are not day traders, and day traders are not investors. Please hear that. I’ll say it again. Investors are not day traders, and day traders are not investors. And it’s all about the long-term with investors and it’s time, not timing, that wins.
Shawn:
If you miss one specific trading day for either buying or selling, and that breaks your portfolio and it breaks everything you’ve been working on you’re not investing, you’re gambling, also known as day traders. And for this one, Proverbs 13:11, “Dishonest money dwindles away, but whoever gathers money little by little makes it grow.” How many times do we see that in scripture where it’s talking about it’s little by little. It’s one day at a time. It’s not get rich quick. None of that makes any sense when you look at scripture.
Bob:
A good foundation is built over time.
Shawn:
That’s right. Biblical investment principle number eight.
Bob:
Bear markets, volatility, and up and down market cycles are to be expected and they’re normal.
Shawn:
And that’s for all investment options. I mean if you’re talking about the liquid markets for stocks and fixed income, equities, things like that. If you’re talking about actual, whether it’s residential, commercial, real estate, industrial, pretty much any market you look at, it’s going to go through cycles.
Bob:
If you’ve got an appraisal on a piece of real estate every single day, it would be a little bit different.
Shawn:
Even that would vary from day to day depending on the adjuster or the appraiser.
Bob:
Volatility is just something that comes with being an investor.
Shawn:
That’s right. And then our scripture for this one is Ecclesiastes 3:1-2, “There is a time for everything and a season for every activity under the heavens. A time to be born and a time to die, time to plant and a time to uproot.” I like the second part of that too. That’s for the invest or sell.
Bob:
Yeah, that’s correct. That’s correct.
Shawn:
Alright. Biblical investment principle number nine.
Bob:
Watch out for those Ponzi schemes guaranteeing unreasonable returns and always be diligent. Get rich quick schemes only work for the greedy, deceptive people that are selling them.
Shawn:
That’s right. And for this one, 1 Timothy 6:9-10, “Those who want to get rich fall into temptation and a trap and into many foolish and harmful desires that plunge people into ruin and destruction for the love of money,” not money itself, “For the love of money is a root of all kinds of evil. Some people eager for money have wandered from the faith and pierced themselves with many griefs.”
Bob:
Shawn, one of the programs that I watch is the CNBC American Greed Program. Kind of interesting and it’s fascinating actually. What’s interesting though is the people, they always get into these Ponzi schemes because somebody guaranteed ’em 10% or 12% every single year, and then they get very upset when they find out it was a Ponzi scheme, but it was their own greed. Because if everything else is at 3% or 5% and it’s paying 12%, it’s unreasonable.
Shawn:
It could also be, there’s fear of missing out.
Bob:
Right, well that’s a big one.
Shawn:
I don’t want to miss out on this if it’s a good deal.
Bob:
That’s so big today, the FOMO mentality.
Shawn:
Yep, I know.
Bob:
Alright, we’re down to number 10.
Shawn:
Biblical investment principle number 10.
Bob:
Investing should always focus on long-term goals from 5 to 20 years with a well thought out financial plan that’s updated annually, otherwise you can quickly get off track.
Shawn:
That’s right. And for this one, Proverbs 21:5, “The plans of the diligent lead to profit as surely as haste leads to poverty.” And there you have it, 10 Biblical investment principles. Hopefully, this helped someone out there and maybe learned something new. We use these principles in our own management here for ourselves, for our clients.
Bob:
In my own life, I’ve used these principles for 30 years.
Shawn:
So thank you for joining us. As always, God bless and see you next time.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 202 – 10 Non Cash Giving Ideas to Lower Taxes10 Non Cash Giving Ideas to Lower TaxesLearn about 10 non-cash giving ways to lower your taxes this year.
More episodes >>
Tired of your precious metals and valuables just sitting around collecting dust? Want to make a difference while also lowering your taxes? In this episode, Bob and Shawn explore 10 creative non-cash giving ideas that can help you bless others, leave a legacy, and reap the rewards of generosity.
They cover ideas such as giving precious metals, real estate, stocks and bonds, as well as miscellaneous valuables and collectibles. If none of these non-cash giving ideas work for you, then you can always volunteer your time to bless others. Giving your time is something beyond donating cash or resources in order to help nonprofit organizations succeed.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodeACTS 20:35In everything I showed you that by working hard in this way you must help the weak and remember the words of the Lord Jesus, that He Himself said, “It is more blessed to give than to receive.”
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTShawn:
Tired of your precious metals and valuables just sitting around collecting dust? Want to make a difference while also lowering your taxes? In this episode, we’ll explore 10 creative non-cash giving ideas that can help you bless others, leave a legacy, and reap the rewards of generosity. Let’s get some perspective.
Welcome to Christian Financial Perspectives. We’re so glad you joined us today while we cover “10 Non-cash, Giving Ideas to Lower Taxes”. Now giving releases, selfishness, giving helps people, giving creates a legacy. Giving is a blessing, and giving lowers taxes, which I’m sure is probably half or more of the reason why people might’ve tuned into this video episode.
Bob:
Well, they might’ve tuned in also Shawn, because non-cash giving, most people don’t think about that, but yet 90% of what we have possession of is not in cash.
Shawn:
That’s right. And that’s even more so the older you are.
Bob:
Yeah, it sure is. So we’re going to cover some really unique ideas today. And there’s an old saying when it comes to giving, “You reap what you sow,” and giving is a principle where you can sow into helping others while also lowering your taxes, which is a benefit and doing something of great significance in reaping those many benefits from it.
Shawn:
That’s right. So before we go any further, we’re going to go over our first scripture, Acts 20:35, “And everything I showed you that by working hard in this way, you must help the weak and remember the words of the Lord Jesus that he himself said, ‘It is more blessed to give than to receive.'”
Bob:
Shawn, many, many blessings come from giving. People don’t realize that, but it does. Try it. You’ll see it. It’s amazing what happens. So today we’re going to look at these 10 non-cash giving ideas for lowering taxes and for helping others. And you’re hearing this correctly. This is not about giving from what you have in cash, but it’s from the other 90% of what you could control to help others.
Shawn:
That’s right. And it’s crazy. Some of the numbers and statistics, I know we in one of our recent Kingdom Advisors Bible studies that it was actually talking about, what was it, 80-90% of giving is from cash, but yet cash as in your income, not your other assets only accounted for, what was it like 10 or 20% of available assets? It was crazy how flip flopped the numbers were that almost all the giving is coming from cash, but yet cash represents such a small percentage of potential assets.
Bob:
Alright, so here’s the first idea. The first idea is how about giving some of those precious metals that’s been sitting around doing nothing, not making anything, it’s not making any dividends. How about giving some gold or some of that silver or even some old diamonds away and helping somebody, a food bank or helping your church or a local senior citizen center. There’s just so many things, Compassion International, which we love around here.
Shawn:
That’s right. And if you are going to do that, we would definitely recommend for the gold, silver, the diamonds, whatever it might be. Definitely check around with multiple brokers because you might get a good broker that’s only charging you 3-5% commission or you get one that’s charging you a whole lot more, 10% or more. So that would be the first thing is definitely shop around.
Bob:
Like that story. And this one of our clients, he said, I could tell the story, I’m not going to say his name, but he inherited right at a million dollars in gold from his dad that his dad had bought about 15-16 years ago or more.
Shawn:
He inherited what his dad paid a million dollars for.
Bob:
And this was 15 or 16 years ago. And he’s gone to five or six different brokers and not been able to get over $900,000 to $950,000 for that. Okay.
Shawn:
Now for those of you at home that don’t have their calculator handy, that’s not a positive return.
Bob:
No, It’s not. Yeah.
Shawn:
It’s not even close to keeping pace with inflation either.
Bob:
You have to look at that. If you are going to give away gold or silver, definitely do it in a way that… maybe set up a donor advised fund and give it to the donor-advised fund and let them find the best buyer for it.
Shawn:
Right. So number two, on these non-cash giving ideas, giving any type of real estate, any type of land you own from say a quarter of an acre or maybe a hundred acres or more, you can carve some of that off to help others and to lower taxes.
Bob:
And I know a lot of people, they would’ve bought an old lot somewhere and it might just be that quarter of an acre and it’s just sitting there doing nothing. It’s costing ’em taxes every year. And they could turn this into living water.
Shawn:
You could also look at for real estate, residential homes, condominiums, apartments on the commercial side, if you have office buildings, professional office buildings, and the final one really would be like farm and ranch.
Bob:
Yeah. And you could carve off just a tiny bit of that, too. You don’t have to carve off the a hundred acres you might own, maybe just a half acre or an acre.
Shawn:
Well Bob, don’t you do Number three?
Bob:
Number three is highly appreciated stocks or bonds. And we’ve been in a pretty strong bull market the last couple of years, especially with all the stimulus package that has been given to us by our politicians. You could just carve off one share, 5 shares, 15, 20, and we will help a church. We’ll open a brokerage account up for them and put that in there and sell it and we won’t charge them anything. No commission, no fees.
Shawn:
Well, because for a church and we want to do things to try to help them out. And if you’re trying to give those stocks or bonds, whatever it might be, well hey, well let’s hope you do that and benefit that church.
Bob:
And you want to carve that off. You don’t want to sell it and then give it away.
Shawn:
Right. Exactly.
Bob:
Because then you’ll have to pay the tax on it, but you’ll get the full tax advantage by…
Shawn:
Basically transfering. You’re just transferring it.
Bob:
That’s right. Transferring that stock.
Shawn:
That’s right. And number four, give miscellaneous valuables and collectibles.
Bob:
Most people don’t think about the things like this.
Shawn:
So maybe you have some art or antiques just sitting around collecting dust that you’re not really getting any joy from. It was, I think it was Marie Kondo or something that if this thing doesn’t give you joy anymore, just say thank you and let it go.
Bob:
I like that.
Shawn:
So another one might be a classic automobile or maybe you have one you just really don’t need anymore. It’s kind of been sitting around and the final one is maybe a boat you have that you don’t need and has been sitting in a storage unit collecting fees for years on end. And there’s ways to do this, right? So of course at any time, feel free to pause this, text us, call us, whatever you want.
Bob:
You always hear that advertisement. I’ll be going home and I’ve got satellite radio and it says Kars for kids. KARS, Kars for kids. They sing that little tune to it. It’s kind of catchy.
Shawn:
There’s some really cool organizations and nonprofits that effectively help with these types of things – the art, collectibles, boat, cars. And that way you make sure that you get the tax benefit and they kind of handle the getting it to whoever needs to get it or getting it sold to generate that cash.
Bob:
They’ll help you. The charities will help you do this. Yep, exactly.
Shawn:
Alright, number five, Bob.
Bob:
Well, number five is a big one here in Texas where we’re located is mineral rights, especially down in south Texas. There’s a lot of oil and natural gas that people have mineral rights, and even water mineral rights or water rights are very valuable and you can carve off a portion of that also to help others and also create that tax deduction that you may need now.
Shawn:
Exactly. And number six, giving out of your estate.
Bob:
Most people don’t think about this for some reason, but maybe this comes later, but it could also come now. The average inheritance is spent in two to three years on things that will rust and rot that might’ve taken you 30 plus years to accumulate.
Shawn:
That’s right. And those numbers on spent within two to three years, that’s not based on, oh, well for less than $500,000 or between this amount and this. No, just in general, it doesn’t matter if you passed on multiple millions of dollars to your beneficiaries or $50,000, two to three years is about the average, which is sad.
Bob:
Some ideas here with your estate is make a charity, or charities, a beneficiary, a partial beneficiary of that estate, maybe 10 or 15, 20, 30%. Some people that are single and have no children, I’d make 100%.
Shawn:
Yeah, why not.
Bob:
Of your estate that’s going to go at your death. You can also give a percentage of your estate right now to charities and get to watch the benefit of that right now.
Shawn:
Bob, just for an example for our viewers and listeners, but I believe for you and Rachael’s estate it’s what? 20%?
Bob:
That’s right. It’s 20%.
Shawn:
Because you’ve got the three girls and then it’s the 20% off the top, if you will. And then what’s remaining is evenly.
Bob:
We’re using the donor advised fund for that. So we call it the Barber family giving fund. Another thing in your estate, a lot of you have is IRAs and that is IRA money when it’s inherited, you have to pay tax on all of it. But if that goes to a charity, they don’t have to pay tax on any of that. If you’re going to give away anything out of your state and you look at it, maybe the IRAs are a really good choice for giving to an estate.
Shawn:
Alright. And then number seven, make those RMDs, the required minimum distributions, a QCD, which is a qualified charitable distribution. If you’re in your seventies, it is the law that you take those certain required minimum distributions. It is age adjusted every year. There’s whole bunch of fun factor stuff. It’s not as easy as a certain percentage. But anyway, whatever that RMD happens to be each year, instead of giving cash to your favorite charities, like your local church, give them a qualified charitable distribution because it’s a lot more tax efficient because otherwise if you take the money out as a required minimum distribution, you have to pay income tax on it. And then you give money to the church, well you do that qualified charitable distribution. For example, maybe yours was $5,000. Well, depending on your tax bracket, you might have what, $4,000 or $3,500 left over. But if you do a qualified charitable distribution, the QCD, the full $5,000 goes to the charity.
Bob:
This is Christian Financial Perspectives. And I tell a lot of our clients, because they’re tithers and they give to their church, instead of giving cash, give from your IRA if you’re in your seventies in the required minimum distribution stage. Now, you can’t do this out of an IRA unless you’re into that, into the RMD requirement.
Shawn:
For me personally, that’s kind of a bummer that you have to be in your seventies to even take advantage of that. Hey, once I’m in my sixties, if we don’t need all of it, I’d rather donate that way. But anyway. Alright, well number eight.
Bob:
Number eight is giving a business interest. That would be like I own a business and that would be carving out some of your business. And for many business owners, plumbers or electricians, heat and air people, that’s their biggest asset is their business. And they want give, but they don’t have the resources possibly. Well, they could make God a part owner in their business or just a minute owner, a charity. And they can donate non-voting interest in their business to a charity and they’re going to get a substantial tax deduction for doing that. But it still allows you to manage the business and to maintain the management oversight of the company. And you have the majority of voting interest in that.
Shawn:
Yeah. It’s similar to publicly traded companies where there’s different classes of stocks and so you have your normal voting, common stock, but then you might have a preferred stock that doesn’t have the right to vote, but maybe receives dividends. So you could do something similar to that for even your own private business. And one of the benefits to that as well is not only the tax deduction now, but you also have the benefit of still being able to pass on that business. Maybe you have one of your kids or in-laws that ends up working with you and they want to take over the business as you start to retire. Well, they can still do that even though you gave away some of the interest to a charity.
Bob:
Okay, number nine, I thought of your dad. Okay. Because you tell everybody what your dad does.
Shawn:
He’s a farmer. So giving agriculture, livestock, crops, cow, goat, horse to charity, whatever it might be.
Bob:
But I was thinking about some of the crops and that actually goes back to scriptural, the first fruit of your crops as well. There’s just all kinds of neat things you can do if you’re a farmer or rancher or you own any agriculture.
Shawn:
That’s right. Okay.
Bob:
We’re down our last one or 10th one.
Shawn:
I’ll let you do number 10, Bob.
Bob:
Alright, well if you don’t have any of the above, you don’t have the land, you don’t have the gold, you don’t have the IRAs, you don’t have any of the above. How about this one? Give up your time.
Shawn:
That’s right. Give of your time because we all have time regardless of how much money we do or don’t have.
Bob:
Some people think you may not have the time, but think about how much time you spend on your smartphone per day. You have the time. Go on a mission trip, a medical one or educational one, maybe even one that’s about construction, volunteer construction, Habitat for Humanity is in most communities.
Shawn:
And they’re real good at, even if you’re not that great at doing stuff, they’ll help. Yeah, exactly. They’ll find something for you to do to help.
Bob:
Exactly. Volunteer time at a local food shelter, your church, or any local charity. So that’s one thing that all of us can do. You may not receive the tax deduction from that, but you’ll get the benefit.
Shawn:
I think a great example, especially your local church is that I know our church, we’re constantly trying to get more volunteers and when your church is 500 to 600 people and it seems like the same 20-30 people are doing setup and tear down, they’re helping with the kids every week and all that stuff. It’s like, come on guys. I know there’s a whole bunch more of you that could volunteer. Maybe every other month you help on a Sunday. If every single member did that kind of a thing, there would never be an issue of lack of volunteers. It’s extremely helpful. You’re blessing other people in your church or if you’re working with the kids, you’re blessing those kids and you’re doing it for the Lord.
Bob:
There you have it. There’s 10 ideas. I hope that you can grab out one or two of these, maybe even two, three or four of them.
Shawn:
Feel free to do all 10 if you want.
Bob:
Because it is such a blessing to be giving and blessing others and yourself. And of course it can lower your tax burden because remember what we said in the beginning, Acts 20:35, “It’s more blessed to give than receive,” and I really believe that.
Shawn:
Amen. Okay, thanks again as always for joining us and God bless.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 201 – Breaking the Chains of MaterialismBreaking the Chains of MaterialismLearn about finding contentment outside of material things.
More episodes >>
Are you feeling trapped by the chains of materialism? Always longing for more, but never finding true contentment? In this episode, we’ll explore how to break free from the grip of greed and discover the joy of a Christ-centered life filled with purpose and generosity.
Bob and Shawn provide Biblical perspectives on materialism and its negative effects on relationships, physical health, and overall well-being. We encourage listeners to seek God’s help, find contentment in what you have, and prioritize meaningful relationships over material possessions.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This Episode1 TIMOTHY 6:10For the love of money is a root of all sorts of evil, and some by longing for it have wandered away from the faith and pierced themselves with many griefs.
LUKE 12:18-20Then he said, “This is what I’ll do. I will tear down my barns and build bigger ones, and there I will store my surplus grain.” And I’ll say to myself, “You have plenty of grain laid up for many years. Take life easy; eat, drink and be merry.” But God said to him, “You fool! This very night your life will be demanded from you. Then who will get what you have prepared for yourself?”
PHILIPPIANS 4:4-13Rejoice in the Lord always. I will say it again: Rejoice! Let your gentleness be evident to all. The Lord is near. Do not be anxious about anything, but in every situation, by prayer and petition, with thanksgiving, present your requests to God. And the peace of God, which transcends all understanding, will guard your hearts and your minds in Christ Jesus. Finally, brothers and sisters, whatever is true, whatever is noble, whatever is right, whatever is pure, whatever is lovely, whatever is admirable—if anything is excellent or praiseworthy—think about such things.
Whatever you have learned or received or heard from me, or seen in me—put it into practice. And the God of peace will be with you. I rejoiced greatly in the Lord that at last you renewed your concern for me. Indeed, you were concerned, but you had no opportunity to show it.
I am not saying this because I am in need, for I have learned to be content whatever the circumstances. I know what it is to be in need, and I know what it is to have plenty. I have learned the secret of being content in any and every situation, whether well fed or hungry, whether living in plenty or in want. I can do all this through him(Christ) who gives me strength.
PROVERBS 23:4-5Do not wear yourself out to get rich; do not trust your own cleverness. Cast but a glance at riches, and they are gone, for they will surely sprout wings and fly off to the sky like an eagle.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
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EPISODE TRANSCRIPTShawn:
Are you feeling trapped by the chains of materialism? Always longing for more, but never finding true contentment? In this episode, we’ll explore how to break free from the grip of greed and discover the joy of a Christ-centered life filled with purpose and generosity. Let’s get some perspective.
Welcome to another episode of Christian Financial Perspectives. My name’s Shawn Peters. I’m joined as always by my father-in-Law, Bob Barber. And today we have, I would say, a difficult subject. I know from Bob’s testimony to me that this was not easy to write, and I know it may be a little harder to hear, but at Christian Financial Perspectives, we always want to make sure that we don’t cover things just because they’re easy or because they’re popular right now, but we want to make sure that we’re providing value and truth based on Biblical principles. And sometimes it’s hard to hear, but as we know, it says in scripture that, “The truth shall set you free.”
Bob:
Amen, brother. And I tell you, Shawn, like I was saying, and I think it’s good for our listeners and watchers to know, you’ll hear me say many times that I can come up with a subject matter and the content, and then we tweak the content over just 15 or 20 minutes. But this was one that I’ve worked on for a month or two because it’s such a hard subject, and the subject is “Breaking the Chains of Materialism”. And when you say that in America, as materialistic as America has become, and I had different titles in front of materialism, and I think I’ve come down to this one, this is the correct one. I think about it as a big chain that is around all of us here in America because we have become so materialistic. I especially see it, Shawn, where I live, I live in a place where it’s pretty expensive to live there. They’re big acreage tracks. Just so you know, I live on 17 acres and my neighbors probably have like 50 acres and…
Shawn:
Most of it being what? The wildlife thing. So you have it, but you don’t do anything with it at least.
Bob:
Yeah. Exactly. It’s a wildlife exemption. And we are in between Austin and San Antonio in the beautiful Hill Country, but I see materialism consuming people all the time.
Shawn:
Well, I know Bob from personal experience, a lot of my peers and friends that are in their thirties and some of them from the gym and other places that are in their twenties, there’s such a pressure, especially for us that we grew up with – well, my parents are around your age and we grew up seeing the success of our parents, and then we kind of get thrown out into the world. And most of us went to college, or a large percentage of us go to college, and many people have student loan debt still, and they’re trying to live the life that they saw their parents living. And there’s pressure because they’ll see other people doing it, but many times they don’t know, well, is that person leveraged to the eyes? They’re just burdened with all this debt or are they’re actually doing well. But it’s that I don’t want to get left behind and well, I’m trying to do this for my wife and my kids and it’s hard.
Bob:
It’s hard. You’re never going to get there. And materialism, greed, and the need for always more has been consuming the thoughts of mankind ever since Adam and Eve.
Shawn:
Yep, that’s true.
Bob:
And the fall in the garden.
Shawn:
You can have everything except don’t mess with that tree. Then of course it…
Bob:
What’s the one thing they want?
Shawn:
That’s the one thing they want.
Bob:
Yeah. The tree of knowledge and materialism is truly one of the destroyers of a content life in Christ. It destroys families, it destroys relationships. It’s a direct opponent to a content life in Christ. It’s like the opponent of Christ.
Shawn:
Scripture warns us many times of the dangers of materialism and greed. We’re going to start out with 1 Timothy 6:10, “For the love of money is a root of all sorts of evil. And some by longing for it have wandered away from the faith and pierced themselves with many griefs.” And that’s something I’ve heard people misquote many times. They talk about money is the root of all evil. No, no, no. The love of money. Money is just a tool. It’s an item. No different than any other tool, but the love of money that is the root of all sorts of evil.
Bob:
And there’s another scripture from Matthew 12:18-20.
Shawn:
Luke, sorry, Luke 12:18-20.
Bob:
Luke, you’re right. Luke 12:18-20. Okay, Shawn, I’ll let you read that since I got that little fumble there.
Shawn:
“Then he said, ‘This is what I’ll do. I will tear down my barns and build bigger ones, and there I will store my surplus grain and I’ll say to myself, you have plenty of grain laid up for many years. Take life easy, eat, drink, be merry.’ But God said to him, ‘You fool this very night, your life will be demanded from you then who will get what you have prepared for yourself?'”
Bob:
So how is materialism defined? And I looked up some definitions of it. There were a lot of different definitions, but I think this definition that I found pretty much fits America. It is a desire for wealth and material possessions with little interest in ethical or spiritual matters. And it’s a philosophy that stems of nothing exists except matter, its movements, and modifications. Okay, modifying. Yeah. As we’ve seen around here, we’ve seen beautiful hill country modified all over the place for materialistic reasons. God’s creation just blipped and now it’s in the form of concrete.
Shawn:
Yep, yep. A lot of politicians and developers and other people that the idea of, well, all growth is good growth. There’s no concept of sustainable, so you don’t lose the very soul of the area. Well, let’s not get into entire episode on how we feel on that, but…
Bob:
Materialism, it hurts people and it coincides with greed. And there’s several points that we need to think about when we think about being materialistic. It makes you greedy and there’s always a need for more.
Shawn:
And people overwork themselves for materialism.
Bob:
It hurts relationships with others.
Shawn:
It causes physical harm from stress.
Bob:
It can make you think you never have quite enough. Does that just really ring a bell? It’s never quite enough.
Shawn:
Yep. That’s why we ask our clients how much is enough, because there is an answer to that.
Bob:
Yeah. That’s a famous saying by Ron Blue that was instilled in my head many years ago. How much is enough?
Shawn:
And it can eventually destroy you and everything around you.
Bob:
Now, I remember Family Life Ministry and Dennis Rainey who I loved following many years ago, and this was a saying that I heard him say that he had never met anyone on their deathbed that says they’d wished they’d worked more and made more money over they wished they’d had those meaningful relationships with their family, their children, and grandchildren. And you see how materialism can take away from those relationships because you’re striving so hard and working so hard, you don’t have time for those that you love.
Shawn:
And the idea is, well look at all the things that I’m able to provide because of working all these extra hours and look at all the stuff I brought home for the family. And if you ask any young kid, do you want more of these random toys or do you want to spend time with mom and dad? They’re going to always say, spend time with mom and dad. Just play with me.
Bob:
At least we hope they say that. Yeah.
Shawn:
Yeah. Well, when they’re teenagers, no, but when they’re younger.
Bob:
Because we got to be careful that our kids can become materialistic also.
Shawn:
That’s true. That’s true.
Bob:
By actually you can give too much in material possessions. Absolutely. Materialistic people just always seem to say, I need just a little bit more. I need, I get there and I need more. It’s never quite enough. They never quite catch what they’re looking for to fill that emptiness that’s inside them.
Shawn:
That’s because the materials can never fill that emptiness as, I don’t remember what pastor I first heard this from, but it’s the God shaped hole that we have in our hearts. You can’t fill it with materials, with consumer stuff, buying things. It just doesn’t work.
Bob:
Changing from that self-absorbed, materialistic perspective that America pushes on us, it does. It requires a conscious effort and heart change to the ways of Jesus Christ.
Shawn:
Yeah. Amen. I think Paul in the Bible describes it best when he talks about contentment, which is the opposite of materialism. Philippians 4:4-13, “Rejoice in the Lord always. I will say it again, rejoice. Let your gentleness be evident to all the Lord is near. Do not be anxious about anything, but in every situation by prayer and petition with thanksgiving, present your request to God and the peace of God, which transcends all understanding will guard your hearts and your minds in Christ Jesus. Finally, brothers and sisters, whatever is true, whatever is noble, whatever is right, whatever is pure, whatever is lovely, whatever is admirable, if anything is excellent or praiseworthy, think about such things. Whatever you have learned or received or heard from me or seen in me, put it into practice and the God of peace will be with you. I rejoiced greatly in the Lord that at last you renewed your concern for me. Indeed, you were concerned, but you had no opportunity to show it.”
Bob:
I want to do this emphasis on these next few scriptures. Okay. The emphasis in this scripture passage of Philippians 4:4-13, emphasis on verses 11 and 13. It says, “I’m not saying this because I’m in need.” This is Paul saying this, “I have learned to be content whatever the circumstances. I know what it is to be in need and I know what it is to have plenty. I have learned the secret of being content in any and every situation, whether well fed or hungry, whether living in plenty or in want, I could do all things through him (Christ) who strengthens me.”
Shawn:
Amen. Are you ready to tackle materialism and put a stop to it? Well, the first thing, ask God to help you.
Bob:
Shawn, as I was writing this, I’m just as guilty as anybody, and I prayed even this morning, I was asking God, God forgive me for being materialistic and I need your help in this.
Shawn:
That’s right.
Bob:
And it kind of hit me because I was like, I don’t want to be a pointing a finger at anybody. I’m not pointing a finger at you, at anyone. I’ve got three pointing right back at me and ask God for help and learn to find contentment in the things you do have, not in the things you don’t have.
Shawn:
That’s right. Yeah. This is not a one and done thing either. Just because you’ve been doing better with not succumbing to materialism doesn’t mean that you’ve won the fight. It reminds me of the analogy where inside of us we have these two warring wolves. You have the white wolf and the dark wolf, the evil wolf. Neither one of them ever die, but whichever one you feed more probably going to win.
Bob:
Yeah, that’s true.
Shawn:
So it’s an ongoing thing. Put your faith in things of eternal value, not a high net worth or temporary material things that rust, rot, and decay that they eventually find their way into a junkyard or a trash dump or a recycling bin, maybe. Depends on what it is.
Bob:
Give it to God spiritually and physically. Start giving materialism up to Almighty God and watch your perspective on materialism change.
Shawn:
Go visit the poor, the sick, and the downtrodden and get a different perspective.
Bob:
Boy, it will. It certainly will. Put your energy into forming meaningful relationship with others, overusing people for selfish, materialistic gain.
Shawn:
Daily, start asking yourself, “And then what?” once you hit another financial milestone or goal.
Bob:
This has been the biggest thing for me, Shawn, once you get to that next point, and then it’s always just a little bit more, and I’m learning to be content with what I have and when I’ve hit that goal, I’m good. I don’t need to be going any farther. Seek that relationship with God. Get out of the mindset that just a little bit more will always make me happy.
Shawn:
Learn to live life with a purpose greater than yourself, not with what only money can buy.
Bob:
This next one is yours. Dump the fear of missing out.
Shawn:
FOMO mentality. Just think about how stupid FOMO really is anyway.
Bob:
It is, isn’t it? Isn’t that the biggest thing that the advertisers want us to think? That we’re missing out? You’re missing out if you don’t get that brand new car. You’re missing out if you don’t remodel your kitchen and go from gray to white countertops because…
Shawn:
That’s the color that’s in.
Bob:
Yeah. Exactly. HGTV is going to continually change. So whatever you think is popular today, just wait two or three years from now, it’s going to be past and you’re going to want to redo it again. So don’t. Get rid of that FOMO idea.
Shawn:
Yeah. Realize that more money can only buy temporary happiness. It can never buy everlasting real joy and contentment. Only a personal relationship with Jesus Christ can do that.
Bob:
And the allure of new cars, clothes, vacations, and stuff always wears off.
Shawn:
And then you need more.
Bob:
And then you need more. Give away that attitude and mindset. Get away from it, give it away, and watch your perspective on life change. Giving really breaks that chain of materialism as well.
Shawn:
That’s right. So start giving now and come up with a long-term giving plan. So do you ever think if I can just make a little more than I can give?
Bob:
Yeah. And I think…
Shawn:
A lot of us.
Bob:
I’ve been guilty of that in my earlier years. If I could just make a little bit more. And you just really need to drop that thought and start coming up with a plan now to find how much money and material possessions are enough for your living lifestyle, your expenses, your debt, tax, and savings. And stick to it and make it reasonable. And don’t raise it just a little bit higher every time you get there. Find contentment in what you have, not in what you don’t have.
Shawn:
Yep. Start with a giving plan of just $100 a month or a week depending on your situation, and increase it from there. Before you know it, and maybe $1,000, maybe even $10,000. Then you’ll start to see the real joy of giving what God can do with what you have.
Bob:
Amen.
Shawn:
I remember the widow with the pennies. The penny. Basically the pennies.
Bob:
Yeah. It’s not looking at an amount, but start small and you start letting go then. You start opening your hand and let it go. Become a financial giver and sower in the eternal and lives of others instead of in material things that rust or rot or break down. That will break those chains.
Shawn:
And write down the most essential things in life not associated with money, like personal relationship with God, health, love and kindness, spouse, children, and friends.
Bob:
And start practicing an attitude of thankfulness and contentment in Christ with what you do have. So I want to end today on this scripture, Proverbs 23:4-5, “Do not wear yourself out to get rich. Do not trust in your own cleverness. Cast but a glance at riches and they are gone. They will surely sprout wings and fly off to the sky like an eagle.” So in our next episode, we’re going to look at all the different ways a person can give and the many giving tools that can be used today to help break the chains of materialism.
Shawn:
And that’s all for today. Thank you for joining us and God bless.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 200 – The Best Of Our 199 EpisodesThe Best Of Our 199 EpisodesLook back at our top, most informative episodes over the past several years.
More episodes >>
Do you know the difference between popular financial advice and essential Bible-based financial wisdom? On this 200th episode celebration, Bob and Shawn reveal the top seven most crucial financial topics from our first 199 episodes.
Christian Financial Perspectives began with the goal of providing timeless Biblical wisdom and education to our audience. Over the years, some of our most educational topics have included sudden wealth syndrome and investing in gold. We hope to continue providing financial advice from a Christian perspective for many more episodes to come!
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersEpisode 48: Sudden Wealth SyndromeEpisode 192 – Are Rental Homes The Worst Way To Invest In Real Estate?Episode 186 – 7 Things to Do Before Buying your next carEpisode 122 – Gold Fever: Is it worth it?Episode 127 – Annuities 101: The Good, The Bad, And The UglyEpisode 162 – Using Emotions As An Investment StrategyEpisode 125 – The Basics of Estate PlanningEpisode 169 – Financially Handling The Loss Of A SpouseEpisode 134 – The #1 Reason For Financial FailureEpisode 177 – What God’s Word Says About Money Part 1Episode 178 – What God’s Word Says About Money Part 2Bible Verses In This EpisodeHOSEA 4:6My people are destroyed for lack of knowledge
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
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EPISODE TRANSCRIPTShawn:
Do you know the difference between popular financial advice and essential Bible-based financial wisdom? On this 200th episode celebration, we’re revealing the top seven most crucial financial topics from our first 199 episodes. Let’s get some perspective. Welcome to our 200th episode of Christian Financial Perspectives. I cannot believe we have now done 200 episodes as of this recording. I haven’t been here for all of them, I guess about half. And I want to start us out with a scripture. Hosea 4:6, “My people are destroyed for lack of knowledge.”
Bob:
And that was my goal here when I started this, Shawn, four years ago, was to bring knowledge to people and we started it with two main objectives for Christian Financial Perspectives. Our first objective was to bring an ongoing educational timeless resource for our clients first and friends of Christian financial advisors.
Shawn:
Right. Timeless meaning we’re not covering too many current events or this particular tax code just changed right now, but try to keep it more applicable for now and 10 years from now.
Bob:
And its Biblical principles are timeless. Okay. And then our second objective was to think beyond just Texas and New Braunfels, our community here in the Austin, San Antonio area. And that was to educate our brothers and sisters nationwide across the country about how to handle their finances from a Christian perspective in a Biblical worldview. And Shawn, I never wanted to measure the success of Christian Financial Perspectives by appealing to the masses. I wasn’t about, this wasn’t about being this big popular program and I wasn’t about providing get rich quick schemes or making gamblers and day traders for people. I just wanted to bring them good Biblical knowledge, and I was going to measure that success one person at a time. That’s the kind of person I am. And that’s the way I wanted to do it. Never being swept into telling our audience what they wanted to hear, but I wanted to tell them what they needed to hear for long-term financial success based on time proven Biblical principles.
Shawn:
That’s right. And really this all comes back to, for Christian financial advisors with our mission and purpose, the purpose really is to expand God’s kingdom through the area of finance.
Bob:
That’s correct.
Shawn:
And so this program fits right along with that. Obviously some people might find us on here and think, Hey, I might want to work with them as a firm. That was never going to be how we measure this as successful. Again, like you said, one person at a time. We’re trying to expand God’s kingdom.
Bob:
Shawn, I love to teach, it’s just my mom was a teacher, her dad was a teacher and a superintendent of schools. We have teaching also, a lot of teachers own my dad’s side of the family. So I just think it’s in my genetics to teach. I love teaching people and you know that from sitting across the desk and hearing how I love to educate people on what they’re doing financially.
Shawn:
Which I think fits right along with this program. So today, with this being our 200th episode for Christian Financial Perspectives, we decided to look at the top seven most essential financial topics that have been covered over the last four years, not necessarily the most popular. So we’re not going off of YouTube views or audio listens from the different podcast directories. This is again, what we feel are the most important topics. So here they are in order of importance, starting with number seven.
Bob:
So we’re going to get to the first, the most important one at the end.
Shawn:
Yes. So in order of importance, starting with number seven and ending with what we know is the number one most crucial financial topic that we’ve covered over the last four years. So number seven, episode 48, “Sudden Wealth Syndrome”, sometimes called SWS.
Bob:
That’s correct. And this happens when someone gets a large inheritance, maybe a lump sum payout. I’ve seen this as well from…
Shawn:
Insurance.
Bob:
Well, that could be. Or even a major corporation you’ve been working for and all of a sudden you get a lump sum payout when you retire, an oil and gas discovery, or even winning a lottery. We’ve not had any lottery winners, but that would be a definite sudden wealth. And sudden wealth is known, unfortunately, Shawn, for making people arrogant. When I looked arrogant up: an unpleasantly proud person that behaves like they’re more important than anyone else and they know more than anyone else because now they have all this new found wealth. And you got to be very careful of that.
Shawn:
It is a danger, it’s a kind of a natural human tendency that if you have a lot of money, especially if it comes very quickly, that you get that arrogance that comes along with it where, well, I have all this money, therefore I’m more important and know more than everybody. And it’s different when you have someone that has built wealth over time through a lot of hard work, that they actually tend to be less arrogant, typically, because they know that where they got here was with hard work. It wasn’t that they were somehow special.
Bob:
Exactly. Being humble is such a good virtue, which was in our Lord and Savior of Jesus Christ. He was humble. When sudden will syndrome comes about, that’s the most important time when you need a fee-based fiduciary, Christian financial advisor more than ever.
Shawn:
That’s right, to help you navigate that. So number six, episode 192, “Are Rental Homes The Worst Way to Invest in Real Estate”.
Bob:
And we’ve made some on real estate, and I think this last one was really one that went well and there just seems to be in real estate, a big misunderstanding of the net return and the real yields after all the expenses associated with owning residential real estate.
Shawn:
And our rental home worksheet is a must to get, if considering buying a rental home, which we did go over that a little bit in the episode.One rental home and just one geographical location is never wise because it lacks diversification for the amount of money it takes.
Bob:
Yeah, it does. You think about that, you’re putting maybe three, I mean here in New Braunfels, you can’t buy anything for less than $350,000 or $400,000 or you’re going to go borrow that much money.
Shawn:
And rates are horrible right now.
Bob:
Really knocks the yield down. You just don’t have a yield. So in this episode 192, “Are Rental Homes the Worst Way to Invest in Real Estate”, we discussed alternative ways to easily buy real estate using a portfolio of publicly traded real estate investment trust. Not private. Yeah, not private ones. And this is across many real estate sectors such as apartment complexes, commercial real estate, retail stores, storage units, hospitals, medical facilities, cell phone towers, and even cloud-based computing storage facilities. So when we came up with this alternative type of portfolio that we’re offering now to people, you don’t have to go to any title company. It’s completely liquid and there’s no sales commissions involved in it. And many times these REITs, they give better yields than one single rental home. More diversification, total liquidity, like I say, no sales charges or title company fees.
Shawn:
And as I know you like to talk about, no worrying about broken water heaters or leaky roof or broken AC unit, dysfunctional renters, you don’t have to deal with any of that.
Bob:
When you think anybody that’s thinking about real estate, HDTV is on every day, have them go listen to that episode.
Shawn:
Yeah. So number five, episode 186, “7 Things to do Before Buying Your Next Car”. We thought this one was a good topic because it’s the largest expenditure typically next to or right behind buying a home for most people. So of all the things you’re going to buy, probably the second most expensive/ largest, but it also happens on average every three to four years with absolutely guaranteed negative returns and losses.
Bob:
Yeah. Would you want to buy an investment that had a guaranteed negative return and significant losses every single time? Well, that’s when you buy a vehicle, that’s what you’re doing.
Shawn:
It is a necessary expense, but don’t ever look at it as an investment because it is guaranteed to go down in value no matter what you do.
Bob:
In this episode, it talks about how most people overpay 90% of the time when they buy a car. So we give you seven great ideas to literally save thousands of dollars when buying that next car. So I would invite you to go back and listen to that one if you didn’t hear that one.
Shawn:
Alright, and number four, we have episode 122, “Gold Fever. Is it Worth it?”
Bob:
Oh, another big one, right?
Shawn:
Yep. We get this kind of questions all the time.
Bob:
I’ve had two calls in the last week about buying gold again.
Shawn:
We cover the fact that there’s no regulation, there’s absolutely no regulation. It’s the wild, wild west when it comes to buying physical gold, manipulative sales tactics are very common within the industry. You really have no idea if you’re getting the real value that you’re purchasing because again, there’s no standards, regulatory requirements. So you might think you’re getting a hundred thousand dollars worth of gold, but in reality, because of the change in the markups and what they’re wanting to get paid in the commission, you got $50,000 to $75,000.
Bob:
And like you say, there’s no regulation that governs this. And something else about gold that a lot of Christians have not thought about is just not Biblically responsible at all. It’s environmentally toxic to God’s creation. And human slavery is used many places around the globe and many foreign countries to get the gold.
Shawn:
Yeah, the most common, you’ll have some sort of international company that’s partnered with something local. Well, the locals are many times employing human slavery to actually get the minerals and then they just sell it to the corporation. So the corporation, well, they’re not using human slavery, they’re just buying it from people that are using human slavery. Well, okay, that’s not really a good argument.
Bob:
And gold also, it has no yield and nothing productive from it.
Shawn:
That’s right. It’s just something you hold and hope the intrinsic value associated with it goes up over time. But there’s nothing to create yield from it. It’s not like owning stocks in a company where if that company continues to produce good products and has better cashflow and more profits that the value of the share can go up over time.
Bob:
And dividends.
Shawn:
And dividends. Exactly.
Bob:
That’s what I like. So now we’re getting into our top 3. Top three, remember, of 199 episodes.
Shawn:
That’s right. Okay, so number three is episode 127, “Annuities 101, The Good, the Bad, and the Ugly”.
Bob:
Why do you think I picked this one here? I’ve gotten a couple more invitations with the big steak dinners on them this week.
Shawn:
Exactly.
Bob:
Literally I’ve gotten two in the last week.
Shawn:
We thought the annuities should definitely be in the top three because, similar to the house purchase and the car purchase, the annuity is not something people purchase all the time, but it’s more closer to say a house. Because if you have a decent sized investment portfolio and you get someone trying to take you to the steak dinner and you move all your money into the annuity and then you’re stuck for 10 years. If you take it out earlier than 10 years, then you’re going to have a penalty, usually, is the time period for that.
Bob:
Very manipulative sales tactics are used to sell annuities also kind of like gold. And there’s a considerable misunderstanding of returns by comparing them to the guaranteed withdrawals of your own money. So I’ve seen this many times where you say, well, you’re guaranteed a 5% withdrawal, and that’s nice. I’m guaranteed to take 5% of my own money every year. Well, you’ll get back 100% of your money in 20 years. Yeah, you will. You take 5% a year times 20 years, you’re going to get back 100% of your money. Boy, that’s a big return, isn’t it? And high commissions in annuities really result in conflicts of interest for those that sell them.
Shawn:
Yep. Because they’re not acting as a fiduciary. They do not have your best interests at heart. They have their highest commission to pad their own pocket is the primary goal.
Bob:
And most people don’t realize that these annuity companies, they’ll offer incentives to, if you sell enough, to the salesperson. If you sell enough of this annuity, we’re going to give you a free cruise or you’re going to get a golf vacation or something like that. They never say that. And I remember seeing this way back in my earlier years, how you get these monthly contests going and I’m like, it’s kind of like on the last day of the month when you want to buy a car, you got to sell that certain amount of car.
Shawn:
Yeah. There’s a lot of push, a lot of incentive. Alright, definitely go check that one out. We cover the types of annuities. We cover there are some situations where certain kinds of annuities might play a part and might be a good fit, but it’s just things to be aware of. So definitely check it out. Number two.
Bob:
Top two now.
Shawn:
Episode 162, “Using Emotions as an Investment Strategy”.
Bob:
And I’ve always said this, emotions and finance, they mix together like oil and water. They should not go together.
Shawn:
That’s right. Which we understand and recognize that as human beings made in God’s image that we have emotions. So it can be difficult to set your emotions aside, but that’s why when we’re looking at making decisions on behalf of clients, if we’re meeting with clients, we always try to get as much as possible, get back to the math, get back to the principles, the objective things that we can look at to try to help us at the very least more better, more better control our emotions.
Bob:
We teach how to use your emotions in a positive way, not a negative way. This is done by actually going the opposite way the crowds are heading when the markets are getting overbought or oversold, and we do that here. And when everybody’s getting frantic and you’ve seen that market go up for two or three years in a row and it’s at all time highs, it’s probably time to go the other direction.
Shawn:
Not at all any kind of solicitation or advice. But just as a somewhat recent example, during 2020, towards the end of 2020, I believe the technology sector was up like 70, 80 something percent and then energy was down 50%. And so that was a good example at that time where you could possibly look at, all right, well I’m not going to buy technology because it’s already up so much and everybody thinks it’s going to go to the moon. But then energy, well, is anyone expecting energy to go away?
Bob:
I think we’re going to continue to use gasoline. And if you remember, that’s one of the things that we did. That was a strategy we did here.
Shawn:
So again, not a recommendation for now, but just I thought that was a good example of what we’re talking about.
Bob:
Well, this episode teaches all about learning how to buy low and sell high, not buy high and sell low using other people’s emotions. And the markets are emotional, too. Very emotional. Alright…
Shawn:
We’re going to have three quick honorable mentions that we’re not really going to discuss much before we cover our number one. But those three, they didn’t quite make the top seven. Episode 125, “The Basics of Estate Planning”. Every family needs a will or a trust, period. And the time to get that set up is yesterday.
Bob:
Episode 169 was “Financially Handling the Loss of a Spouse”. That’s never fun. It’s never easy, very painful. And finances spend any time are the last thing you want to deal with during a time of loss.
Shawn:
That’s right. And then episode 134, “The Number One Reason for Financial Failure”. I’ll give you a hint. Procrastination. This episode we cover all the financial areas where we procrastinate that costs people tens of thousands, if not hundreds of thousands, of dollars. Alright. And so our number one top recommended topic over the years by far is episodes 177-178. It was a two-parter, but it covers “What God’s Word Says About Money”. This was actually a remake of the very first episode before my time as co-host. But need we say more, the Bible should be the primary guidebook for how Christians manage what God puts into our possession.
Bob:
My kids have always said, and I’m kind of a Proverbs nut. I love Proverbs.
Shawn:
That’s a good book.
Bob:
It’s a great book. And it is the owner’s manual for managing our finances. And I want to make this statement, and this is a very, very powerful statement. I want you to hear it. Okay. I have never seen anyone hurt financially by following Biblical principles, BUT I have seen many people and families hurt by not following Biblical principles.
Shawn:
Amen. So there you have it, our top seven financial topics that we’ve covered over the last four years and the first 199 episodes plus our three honorable mentions. But today’s 200th edition was just one we thought to go back and maybe listen to a few times. We’ll make sure we put stuff in the description depending on where you’re consuming this content so that way you can reference these seven financial topics and the honorable mentions. But we are committed to continuing to bring you financial topics from a Christian perspective for hopefully many more years. I know Bob doesn’t have any intent on retiring anytime soon. He loves doing this, loves teaching. And we just want to thank everyone who has listened or watched over the years, the comments, suggestions, keep them coming, by the way. We love getting feedback or suggestions on topics that you’d like us to cover and help you with. So if you’d like to learn more about Christian Financial Advisors, please visit our website@christianfa.com or call or text us at (830) 609-6986 during business hours. Thank you so much and God bless.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 199 – Biblical Viewpoints Of Money and Wealth Part 3Biblical Viewpoints Of Money and Wealth Part 3Learn about the final weeks of a Bible study on financial stewardship.
More episodes >>
Are you ready to dive deeper into God’s design for generosity, giving, and leaving a lasting legacy? In this final part of our series, Bob and Shawn explore Biblical perspectives on using wealth to bless others and how to properly pass on an inheritance that impacts generations to come.
“Biblical Viewpoints of Money and Wealth” emphasizes the importance of stewardship and giving from a Biblical worldview. In this episode, weeks 6 and 7 are summarized, which includes the ripple effect of giving and the proper way to leave an inheritance and legacy for future generations.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBiblical Viewpoints of Money and WealthBible Verses In This EpisodeMATTHEW 25:34-40Then the King will say to those on his right, ‘Come, you who are blessed by my Father; take your inheritance, the kingdom prepared for you since the creation of the world. For I was hungry and you gave me something to eat, I was thirsty and you gave me something to drink, I was a stranger and you invited me in, I needed clothes and you clothed me, I was sick and you looked after me, I was in prison and you came to visit me.’
Then the righteous will answer him, ‘Lord, when did we see you hungry and feed you, or thirsty and give you something to drink? When did we see you a stranger and invite you in, or needing clothes and clothe you? When did we see you sick or in prison and go to visit you?’
“The King will reply, ‘Truly I tell you, whatever you did for one of the least of these brothers and sisters of mine, you did for me.’
PROVERBS 20:21Wisdom, like an inheritance, is a good thing and benefits those who see the sun.
ECCLESIASTES 11:2Invest in seven ventures, yes, in eight; you do not know what disaster may come upon the land.
MATTHEW 6:19-21Do not store up for yourselves treasures on earth, where moths and vermin destroy, and where thieves break in and steal. But store up for yourselves treasures in heaven, where moths and vermin do not destroy, and where thieves do not break in and steal. For where your treasure is, there your heart will be also.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTShawn:
Are you ready to dive deeper into God’s design for generosity, giving, and leaving a lasting legacy? In this final part of our series, we’ll explore Biblical perspectives on using wealth to bless others and how to properly pass on an inheritance that impacts generations to come. Let’s get some perspective.
Welcome back to another episode of Christian Financial Perspectives. My name’s Shawn Peters. This is Bob Barber. we’re going to be covering part three of a series that we’ve been doing. Six years ago, Bob wrote a seven week bible study called “Biblical Viewpoints of Money and Wealth”, and we’ve been giving this brief overview of the Bible study over the course of three videos with today being that final video. So if you’ve not heard parts one and two, we would definitely encourage you to listen or watch those first. So we’ll wait for a sec. Alright, if you’re still here, we’re assuming you watched, you listened to the first two. So this seven week Bible study explores God’s design for money, stewardship, and creating a lasting legacy. If you want a copy of this Bible study for you or for a small group, just click the link that we have in the description, or you can search on Amazon for Biblical viewpoints of money and wealth. So Bob, why don’t you give our viewers and listeners a little bit on what exactly is the foundation of this study? What are we looking at?
Bob:
Okay, so the foundation of the study looks at how wealth comes from belongs to and should honor God, as well as how wealth should be distributed wisely to the next generation. Using wealth Biblically is providing for those that God has entrusted to us, like our family, supporting the church, spreading the gospel, supporting missionaries, providing for God’s family, feeding the hungry, clothing to poor, sheltering the homeless, healing the sick, educating the homeless, protecting the innocent, and providing for widows and orphans.
Shawn:
Is that all?
Bob:
Yeah, so that’s truly a synopsis of the entire study just right there in what that is, what the study is about. It is a very deep study that gets into God’s word. You are going to be going from scripture to scripture and seeing what God’s word has to say about stewardship because as many Biblical scholars agree, there’s over 1500 to 2000 scriptures on stewardship, and Jesus spoke on stewardship more than any other subject, even more than heaven and hell combined. So stewardship was very important to our savior.
Shawn:
That’s right. And a lot of this really comes down to the mind and heart of the individual. And so this book is very much a Bible study. This is not a book with a whole lot of writing and occasionally there’s a Bible verse.
Bob:
Well, you can see right here if you’re watching the video, it’s not that thick, but there’s a lot of looking up of scripture.
Shawn:
It’d be a lot thicker if we already put every single scripture in there.
Bob:
It would probably be an inch thick if that was the case.
Shawn:
That’s right. So really what this goes into is again, the heart and mind of each one of us and helping us look at it from that Biblical perspective. So there’s not a bunch of tips on budgeting and cash flow and investing and things like that because if you get your heart and mind right first, then you can start looking at that.
Bob:
This is the foundation.
Shawn:
That’s right. So the seven viewpoints that we go through in this Bible study over typically a seven week period, you can go faster if you’d like, but number one, the difference between a Biblical and secular worldview, this is the foundation for the rest of the Bible study and being able to handle wealth from a Biblical perspective.
Bob:
We look at the difference in the second week of an owner and a manager. We take an example of a restaurant owner, you have a restaurant owner and you have the manager that’s running the restaurant. Could be both.
Shawn:
Very different roles.
Bob:
But they’re very different roles. They are.
Shawn:
Number three or week three, we go through the Biblical worldview of work and retirement. For those of you who maybe have not listened to any of our previous podcasts, we have definitely talked about this before, but work is mentioned a lot.
Bob:
Over 500 times.
Shawn:
That’s right. And how many times is retirement mentioned?
Bob:
One time.
Shawn:
Once and it was for the priest. Very specific situation.
Bob:
But they will teach the younger.
Shawn:
That’s right. And they didn’t retire from work, they retired from that particular position.
Bob:
And they go into a teaching mode. So that’s the way I look at it.
Shawn:
And then chapter four or week four, what are we covering there, Bob?
Bob:
The difference between secular and Biblical counsel, and we got pretty deep into that a couple sessions ago, but you’ll really have your mind open to this where you’ve never thought about the counsel that you’re getting because it’s coming to you from a secular worldview or a Biblical worldview, all of it.
Shawn:
Chapter five, week five, money and wealth from a Biblical worldview, also a very good one. And number six…
Bob:
Giving and blessings, which we’re going to cover today. We’re going to give you a little short part of that. And then the last one is properly leaving an inheritance and legacy for the following generations, which is so important because the word in there, the keyword is properly leaving that inheritance, not just throwing it to them.
Shawn:
Right. So today we’ll be giving you a brief overview of what the last two weeks of this study covers as we’ve done in our previous two episodes covering the first five weeks of the study. So let’s get started. Week six, giving and blessing from a Biblical worldview. One of the scriptures that we dive deep into for this week of the study is Matthew 25:34-40. Do you want me to go through that scripture?
Bob:
You got it. Go for it. Go for it.
Shawn:
“Then the king will say to those on his right, ‘Come you who are blessed by my father, take your inheritance, the kingdom prepared for you since the creation of the world. For I was hungry and you gave me something to eat, I was thirsty and you gave me something to drink. I was a stranger and you invited me in. I needed clothes and you clothed me. I was sick and you looked after me. I was in prison and you came to visit me.’ Then the righteous will answer him, ‘Lord, when did we see you hungry and feed you or thirsty and give you something to drink? When did we see you a stranger and invite you in or needing clothes and clothe you? When did we see you sick or in prison and go to visit you?’ The king will reply, ‘Truly, I tell you, whatever you did for one of the least of these brothers and sisters of mine, you did for me.'”
Bob:
So when you think about giving from a Biblical worldview, this is a very good scripture to look at. And what we do in this study as a small group is we list up to 10 ways that we can use the resources that God has blessed us with to help others and bring glory to God. So some examples of that would be providing shelter. You can see where it talks about providing shelter, providing food and shelter for the homeless and mentally ill. Most people don’t realize that the homeless have mental illness. That’s one of the main causes most of the time of homelessness, volunteering at a local food bank or ministry like Habitat for Humanity, which helps build homes for those that are not so fortunate, ministering to the sick in a hospital or a nursing home. That is such a great way that we can help give of our time and resources.
Shawn:
That’s right. And what’s interesting too, of the three examples you gave, Bob, volunteering at the local food bank ministry, ministering to the sick and a hospital nursing home. Both of those two are something that basically any of us can do because neither of those really require monetary resources, just our time and willingness to serve.
Bob:
That’s right.
Shawn:
So other areas that are covered in week six are the four different ways of giving.
Bob:
Which most people don’t think that there’s four different ways of giving, but we go into that in detail.
Shawn:
And the ripple effect of giving. So why don’t you go ahead and give us the example.
Bob:
Well, the examples of the ripple effect. So you think about when you throw a rock into a pond, what happens? You have this ripple effect that goes out, it’s all the way around 360 degrees. So God gives to us and when he gives to us, we’re receiving. But when we take that and we give to others, they are receiving. So it carries the ripple effect and this giving multiplies when it flows from God through us to others. So look at us like a vessel. It’s coming through us like a pipeline.
Shawn:
Yeah, that’s right.
Bob:
We mentioned this in the study, the Dead Sea. Why is the Dead Sea dead?
Shawn:
It doesn’t have any outflow.
Bob:
Exactly. Everything goes into it, but nothing outflows. That’s what can happen in our lives if we’re only just take, take, take, but we’re never giving to others generous giving. When we’re generously giving, it’s teaching others, our children are seeing it, our grandchildren are seeing it, others are seeing it, as well as the following generations, and we want to teach them to be generous givers. And that’s this week six of this study talks about is giving really from a different perspective and looking at it from a Biblical worldview.
Shawn:
Well, and as it is said, it’s better to give than to receive.
Bob:
Yes. And most people don’t realize that it’s more blessed to give than receive because like you say, you’re not all stopped up kind of like the dead sea.
Shawn:
Exactly. So then in the last week of the seven part series we go into or it goes into properly leaving an inheritance and legacy for the following generations.
Bob:
Again, not talked about much, is it Shawn? When you hear about money, it’s always talked about budgeting or debt. But this is very important, especially for parents and grandparents. This is a good Bible study for them.
Shawn:
And I would guarantee you, Bob, that most people, unless maybe they’ve gone through a study like this or gotten to some of the same conclusions, but most people would look at when you leave an inheritance, oh well okay, if you have two kids, then 50/50. If you have three kids and you divide it into thirds. If you have whatever the case may be, it’s like, oh yeah, every kid gets an equal share air. And honestly, that’s a terrible method to use for a number of reasons, which we do go into, but it doesn’t need to be equal. And the thing that we definitely encourage our clients here and anyone who’s watching or listening, remember that there’s at least one extra party, the church, missionaries, expanding the Kingdom of God. Your inheritance to your descendants does not have to be all directly to them. So anyway, without further ado.
Bob:
An inheritance left that’s not thought about through the eyes of scripture can hurt so much more than it can help. People don’t realize that. And Proverbs 20:21 is the scripture we look at in this Bible study, “An inheritance claimed too soon will not be blessed in the end.”
Shawn:
That’s true.
Bob:
And that’s a very strong scripture. And what does that mean? How do we take that and apply that? I believe it means that inheritance given to the next generation can be given slowly. It doesn’t have to be all given at once. And today with the tools that we have, setting up a trust. And you can give a percentage, a 3%, 5% a year out to the next generation. There’s nothing wrong with it going slowly over the next 10 or 15 years while they learn to handle it.
Shawn:
Exactly. That also has the added benefit of if you’re setting this up, instead of it just being a X amount of dollars after taxes and everything but X amount of dollars that goes to your kids, well you could set up that trust where only a certain amount goes out. So then your kids and their kids and their kids would continue to see a benefit from this and that over time it could continue to bless multiple generations instead of what is it on average if an inheritance is received as a lump sum, it’s what, 18 to 24 months on average?
Bob:
Yeah, about 18 to three years, it’s gone. Yeah, I mean that’s not everyone.
Shawn:
No, it’s not.
Bob:
But that is a large percentage of inheritance is spent what the parents and the grandparents spent 20 and 30 years saving and putting together can be spent in literally three or four years, and it’s gone. And I’ve seen it in my 35 years in this business many, many times. But Ecclesiastes says, “Wisdom like an inheritance is a good thing and benefits those who see the sun,” is what it says. But you realize what it says first it says wisdom. And if we’re passing down a financial inheritance without passing down wisdom, that’s a recipe for disaster.
Shawn:
That’s right.
Bob:
And I love this last one, Matthew. Go ahead.
Shawn:
Matthew 6:19-21, “Do not store up for yourselves treasures on earth where moths and vermin destroy and where thieves break in and steal, but store up for yourselves treasures in heaven where moths and vermin do not destroy and where thieves do not break in and steal for where your treasure is there, your heart will be also.”
Bob:
So in this Bible study, what we do, we take these scriptures and you’re going to write down three things that you would most like your heirs to inherit that’s not associated with money, wealth, or anything that can rust, burn, or deteriorate over time. Let me say that one more time. You write down three things that you would most like to pass down to your children, your children’s children, not associated with money, wealth, or anything that can rust, burn or deteriorate over time. That takes away all the material possessions because I want to pass down to my children things like wisdom, faith in Jesus, and a good name. I want to pass me having a good name and reputation and I hope that they do the same.
Shawn:
One of the last things that you’ll do in this final week of the study will be how to leave an inheritance and legacy for the following generations properly. And we will give you three thought provoking examples of how your heirs, or how to determine if your heirs are ready, to inherit money and wealth wisely. Things like they are responsible with their earnings.
Bob:
Yeah, they’re not in a bunch of high credit card debt.
Shawn:
You have seen them regularly save and budget wisely, and you notice that they are givers to worthy causes, church, missionaries, other non-profits. Yeah, those are just some examples of things to look for to see are they ready to inherit money and wealth.
Bob:
So there you go. That’s our three part series on this Bible study. We have literally, hundreds of churches in Texas and South Texas have gone through this study. The first part of it was called “Seven Pillars of Biblical Stewardship”, and then this is the revised edition, which is much easier to follow. We really hope that you get excited about this. I think once you’ve gone through it, you will see the excitement. We’ve seen changed lives, and we just pray that God will use this Bible study to renew your mind and transform how you think and how you view and other people view how they handle money through God’s lens.
Shawn:
That’s right. And if this study does sound exciting or beneficial to you, please consider purchasing your own copy for yourself or for your small group, Bible study group. You can click the link in the description or search on Amazon for Biblical viewpoints of money and wealth. Also, don’t forget to share this episode with others who might find it beneficial. Feel free to reach out to us by phone or text with any comments or questions at (830) 609-6986. As always, thank you and God bless you.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 198 – Biblical Viewpoints Of Money and Wealth Part 2Biblical Viewpoints Of Money and Wealth Part 2Learn about the first 3 weeks of a Bible study on stewardship.
More episodes >>
Do you struggle with aligning your view of money and wealth with the Bible or are you looking for a deeper Biblical perspective? For several episodes, Bob and Shawn are diving into a study examining God’s design for wealth and work. In part 2 of 3, they delve into the differences between secular and Biblical counsel, and the Biblical perspective on money and wealth.
We recommend you to go back and listen to part 1 before digging deeper into this episode of “Biblical Viewpoints of Money and Wealth”. The book can be found on Amazon, and we encourage listeners to engage in the study and to share the episode with others who may find it beneficial.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBiblical Viewpoints of Money and WealthBible Verses In This EpisodePROVERBS 15:22Plans fail for lack of counsel, but with many advisers they succeed.
ECCLESIASTES 4:9-12Two are better than one,because they have a good return for their labor: If either of them falls down, one can help the other up. But pity anyone who falls and has no one to help them up. Also, if two lie down together, they will keep warm. But how can one keep warm alone?Though one may be overpowered,two can defend themselves. A cord of three strands is not quickly broken.
ECCLESIASTES 11:2Invest in seven ventures, yes, in eight; you do not know what disaster may come upon the land.
DEUTERONOMY 8:18But remember the Lord your God, for it is he who gives you the ability to produce wealth, and so confirms his covenant, which he swore to your ancestors, as it is today.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTShawn:
Do you struggle with aligning your view of money and wealth with the Bible or are you looking for a deeper Biblical perspective? We’ll dive into a study examining God’s design for wealth and work. Let’s get some perspective. Welcome back to Christian Financial Perspectives. Today we’re going to be covering part two of our Biblical Viewpoints Bible study. I’m going to pass it over to Bob since this is something that he worked a lot on and figured it’d be better let him kind of introduce it, especially for those who may be missed the last episode.
Bob:
Sure thing, Shawn. So about six years ago I wrote a seven week Bible study called Biblical Viewpoints of Money and Wealth, and last week, this week, and next week, what we’re doing is we’re quickly giving a brief overview of what this Bible study is about. And the nice thing is if you’d like a copy of it, you can go to Amazon and just put in Biblical viewpoints of money and wealth and you can get a copy for yourself. And a lot of people like to teach this in a small group. It’s been taught many times in small groups. This is also a revised edition of Seven Pillars of Biblical Stewardship, which was taught in hundreds of churches 10 years ago, 10, 12 years ago, something like that.
Shawn:
This is more, a little more, no, no, I wouldn’t say simplified, but I guess you set this one up in a way that someone could pick up the book by themselves and go through it. Or they could pick it up for the first time and go through it with their small group. Seven pillars, just the way that you guys had set it up before, I know there are other people that were part of that process. It was took more, I don’t know how else to say that.
Bob:
Well…
Shawn:
They needed to be trained on how to go through it.
Bob:
They did. They had to be trained on it. So this is a seven week Bible study that really digs deep into what God’s word says about money. And I would emphasize if you didn’t get to hear last week’s program covering what’s being covered in the first three weeks of the study, that you would go back and listen. We encourage that. Either listen to it or view it on YouTube.
Shawn:
This is a great study. I know I’ve been through it I guess a couple times now because I’ve gone through it once and then we went through it again not that long ago as a staff.
Bob:
About a year ago.
Shawn:
And very, very beneficial. It’s very Bible heavy. So there are a lot of different kinds of books that you can go through in a small group setting, and some of them are a page of writing and then there’s a scripture verse kind of a methodology, which there’s nothing wrong with that, but this one is more of here’s a question, read these 2, 3, 4 scriptures, and then maybe there’s a follow-up of, okay, great. So now from what you read, here’s a question, write down what you got from that. And so I really like that personally because it allows the scripture to lead the person who’s going through a study like this. It allows scripture to lead more than just what you as an author or someone else as an author is specifically trying to say. So I think it’s really good.
Bob:
Yes, it’s truly a Bible study and you’ve got to have your Bible to go through it.
Shawn:
Or the Bible app. I know a lot of…
Bob:
Okay. Yeah. So the foundation behind this study is that Biblical wealth comes from, belongs to, and should honor God, as well as that wealth, how it should be distributed to the next generation wisely. Okay.
Shawn:
The Biblical wealth is here’s a, I guess you’d say a definition, is providing for those God has entrusted to us, supporting the church, spreading the gospel, sending out and supporting missionaries, providing for God’s family, feeding the hungry, clothing the poor, sheltering the homeless, healing the sick, educating the hopeless, protecting the innocent, and providing for widows and orphans.
Bob:
Straight from scripture.
Shawn:
That’s right.
Bob:
These seven viewpoints that we cover over this seven week period are the first week we cover the difference between a Biblical and secular worldview. And that forms the foundation for the rest of the Bible study how to handle wealth from a Biblical perspective. Then week two covers the differences between an owner and a manager. And that’s an interesting one. What does that mean? Well, we’re managers and God is the owner. So we go through the scenario of like a restaurant owner, you own the restaurant, but what if you were the manager of the restaurant? How would those differ?
Shawn:
How would you act? How would you treat the assets and the things that you have differently if you were a manager versus an owner? And then week three covers the Biblical worldview of work and retirement. So we’re going to be covering, starting today, we’re going to be starting with week four. And then we’re also going to talk a little bit about week five for the Bible study. Week four looks at the difference between secular and Biblical counsel. Week five then covers money and wealth from a Biblical worldview.
Bob:
And then week six and seven, week six covers giving and blessings from a Biblical worldview. And week seven covers properly leaving an inheritance and legacy for the following generations.
Shawn:
That’s right. Okay, here we are. We’re going to get into starting with, for today, week four and diving into the differences between secular and Biblical counsel and a few of the scriptures we’re going to look at. We’re going to start first with Proverbs 15:22. Bob, you want to read that one?
Bob:
Well, I know that one, I don’t even have to read it. That’s one of my favorite scriptures in all the Bible is that, “Plans fail from lack of counsel, but with many advisors they succeed.”
Shawn:
And then Ecclesiastes 4:9-12, “Two are better than one because they have a good return for their labor. If either of them falls down, one can help the other up, but pity anyone who falls and has one to help them up. Also, if two lie down together, they’ll keep warm. But how can one keep warm alone? Though one may be overpowered, two can defend themselves, and a cord of three strands is not quickly broken.”
Bob:
So you got the two, and then the third cord is the Holy Spirit giving you that guidance. So there’s 20 characteristics, also, that’s in 1 Timothy 3:1-12. And we are not going to read that entire passage, but this has to do the difference between a Biblical worldview and a secular worldview. And we also look at what 20 characteristics to avoid. So we look for 20 characteristics of what to look for in Biblical counsel and 20 characteristics of what to avoid in secular counsel that is found in 2 Timothy 3:2-5, and 1 Corinthians 6:9-10, and we list all 20 of ’em. So that’s the neat thing about the study. You do that, remember the first week we did that, we did the difference between a Biblical worldview and a secular worldview. So here it’s side by side. You’re looking at this is the characteristics of Biblical counsel and then this is the characteristics of secular counsel and what to avoid. You can see they go right down the page, come right out at you. And by the end of week four in this study, you’re going to truly see the difference between Biblical and secular counsel and how important it is. And you’re going to see the benefits of Biblical counsel and the dangers of secular counsel.
Shawn:
I think that’s a good chapter. Alright, well we’ll just stop there. I’m just kidding. Okay. Alright. And then week five. So coming off of that, and obviously there’s no requirement, too, if you get this book, especially if you’re going through it by yourself, I mean you could do as many chapters as you want. It’s just typically this is set up more as you do one chapter a week.
Bob:
Well, you’ll find that it’s going to take you about 30 minutes to do each chapter, 30 to 40 minutes depending on how deep you want to go. And we highly suggest, too, that you pray and ask God’s Holy Spirit to help you interpret scripture in the way that he wants to speak to you.
Shawn:
That’s right. So in week five, the study covers money and wealth from a Biblical worldview starting with Deuteronomy 8:18, “But remember the Lord your God for it is he who gives you the ability to produce wealth and so confirms his covenant, which he swore to your ancestors as it is today.”
Bob:
So we look at this word “wealth” because we’re talking about money and wealth from a Biblical worldview. And that wealth appears in scripture over 100x, Shawn, it’s referred to both positively and cautiously. Wealth can be a great thing, but also it can hurt. It can be a blessing and a curse if not handled with wisdom. And we’ve seen that in so many people. I mean, you just look across society and see how wealth has totally destroyed some people, but others who have handled it correctly and done it from a Biblical worldview. It can be a great blessing.
Shawn:
When you get someone that wins the lottery and all of a sudden they have all this extra money and you would think, oh, it’d solve all their problems. But if anything, it typically makes everything so much worse.
Bob:
They’re worse off after than before. Now they’re well off for a while, and we call that sudden wealth syndrome and sudden wealth syndrome, we’ve had a program on that because it can come in many different ways, not just through a lottery.
Shawn:
It could be lottery, could be relative that passes away…
Bob:
Inheritance.
Shawn:
Life insurance from a spouse. I mean, who knows? There’s a lot of different ways.
Bob:
We’ve seen it many different ways.
Shawn:
Oil and gas.
Bob:
A lot of oil and gas, especially where we are. We’re within an hour’s drive of one of the biggest oil hits in the world called the Eagle Ford Shell. It’s not the biggest, but it’s very large.
Shawn:
It’s big.
Bob:
It’s really large. And I drive down through it on our way down to our place in Rockport, Texas on the coast, and I’m always seeing all these oil wells.
Shawn:
So that sudden wealth syndrome, it creates a false sense of power and security, or at least it can, that causes a person to make a irrational decisions rejecting any and all wise counsel from others who have experience in handling wealth. Many times what they don’t realize is that that wealth can disappear just as quickly if it is not handled correctly and with wisdom. And I think the most common example of that, Bob, is when someone discovers oil or natural gas or something on their property and all of a sudden, I mean we saw how many times did you see that Eagle Ford Shell? You’d have a household that’s making $40,000-50,000 maybe a year, and all of a sudden they’re making what, a $100,000 a month or more? And it just very quickly then goes down to where now maybe they’re making what, $10,000 a month, maybe?
Bob:
Exactly. 10-20k.
Shawn:
If that person isn’t wise with that money coming in and they adjust their lifestyle, assuming they’re going to continue to make a million or more dollars a year, you got a bunch of boats and cars and all these houses and stuff that you can’t maintain anymore once the income starts dropping back down, which inevitably happens in that kind of a situation.
Bob:
As we look in that week five from Biblical wealth and how to handle that, we use Ecclesiastes 11:2. And that’s a discussion, “Investing in seven ventures, yes, in eight, for you do not know what disaster may come upon the land.” That’s about wealth and how to invest wealth. We take this scripture into the study and we list seven to eight areas. You list it out with your group or by yourself, what did Solomon invest in? And you can go to scripture and you can see it will tell you what Solomon invested in. And then you can look at today, how would you invest?
Shawn:
I think one of the things that you got to remember too is that when we look at where Solomon invested, it’s not a recommendation that you go buy a bunch of goats and cattle necessarily. I think the wisdom from that is more in the fact that Solomon didn’t just have all one or two or three things, that he had wealth spread across pretty much whatever was available to him. So there are things that are available now.
Bob:
Shipping, there was transportation, there was actually back then it was gold back then.
Shawn:
But also there was no fiat currency back then. That’s true. So very different.
Bob:
That’s true.That is definitely true. And we don’t use gold now when we go to the store and buy something.
Shawn:
Exactly. Yeah.
Bob:
We use our debit card.
Shawn:
We get more into that in the study. We get more into the study. I just wanted to at least mention that.
Bob:
We also, in this instant, we look at a business owner and three different kinds of managers of a business. I’m going to give you some of these scenarios and it’s kind of fun to think about this. Pretend you’re an owner of a business and you have a manager. The first manager never shows up early or ever offers to stay late and help you with anything, even if there’s a major problem.
Shawn:
Yeah. Maybe you got inventory that came in and you really got to get it finished before the next day. Well, it’s five o’clock. See you later.
Bob:
The second manager, so we got manager, that was manager number one. We got the manager number two shows up on time every day, but only does enough to get by. And then you got manager number three. He shows up early every day, stays late if necessary, not every day, but if necessary, offers suggestions for making things better and goes way beyond the call of duty. So of the three managers, which one would you want to give more responsibility to?
Shawn:
And possibly a raise?
Bob:
Exactly. And so we ask.
Shawn:
Oh, definitely number one. Yeah. Haha.
Bob:
So we use a scriptural guideline in this of Luke 16:10-12, and I would invite you to go look that up because it talks about if you’re good with a little, you can be good with more. Okay.
Shawn:
Again, it’s never a, it should never be looked at, I feel like, when we’re talking about these kinds of scriptures and principles that you are managing what you have well just because you want more, because then I feel like we kind of miss the whole point. And especially some of these other chapters, you miss the whole point. As believers, as followers of Christ, when we do a good job with what God has blessed us with and entrusted us with, it’s out of respect and reverence and worship for him, not with an expectation of, “Okay, I did a good job. Give me more, please.”
Bob:
Oh yeah.
Shawn:
But there is that other aspect of it of if you do well, then it’s kind of like this thing of, okay, the Lord does know that should he give you more, He knows you’re going to do well with it.
Bob:
You think about the third manager, that third manager that went beyond the call of duty had a humble heart. It wasn’t all about him. It was about helping the business that he was working for. Well, that’s all for today. And don’t forget, if you’ve not heard last week’s program, we’d invite you to go back and listen to that. We’re going to cover this again next week on our three part series of “Biblical Viewpoints of Money and Wealth”. We’re going to cover next week how to handle giving and blessings from a Biblical worldview and how to leave that inheritance for the following generations. All seven weeks of the modules build on each other. Or they could even stand alone, but they build on each other. And our prayer is that God will use this Bible study to renew minds and transform how people view and handle money through this lens.
Shawn:
That’s right. This Bible study is very focused on the hearts and minds of people. It’s not specific advice of buy this or invest in this particular thing, or this is how you budget. But we really hope that if this study does sound interesting or beneficial to you, please consider purchasing your own copy, either for yourself or for your own study group. And don’t forget to share this episode with others that you think might find it beneficial. It doesn’t cost anything.
Bob:
And you can find the study where?
Shawn:
You can find the study – the easiest place honestly, would just be go to Amazon and search for “Biblical viewpoints of money and wealth” and that’s basically it. But feel free to reach out to us with comments, questions by phone or text at (830) 609-6986. God bless.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 197 – Biblical Viewpoints Of Money and Wealth Part 1Biblical Viewpoints Of Money and Wealth Part 1Learn about the first 3 weeks of a Bible study on stewardship.
More episodes >>
Do you struggle with aligning your view of money and wealth with the Bible or are you looking for a deeper biblical perspective? Over the next few weeks, we’ll dive into a study examining God’s design for wealth and work called “Biblical Viewpoints of Money and Wealth”. The study is a seven-week deep dive into what the Bible says about money and how it applies to real life. It covers topics such as the difference between a Biblical and secular worldview and the responsibilities of an owner versus a manager.
The study is available for purchase on Amazon, but please don’t hesitate to reach out if you are interested in teaching or promoting the study in their churches or small groups.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBiblical Viewpoints of Money and WealthBible Verses In This EpisodeGALATIANS 5:16-23So I say, walk by the Spirit, and you will not gratify the desires of the flesh. For the flesh desires what is contrary to the Spirit, and the Spirit what is contrary to the flesh. They are in conflict with each other, so that you are not to do whatever you want. But if you are led by the Spirit, you are not under the law. The acts of the flesh are obvious: sexual immorality, impurity and debauchery; idolatry and witchcraft; hatred, discord, jealousy, fits of rage, selfish ambition, dissensions, factions and envy; drunkenness, orgies, and the like. I warn you, as I did before, that those who live like this will not inherit the kingdom of God. But the fruit of the Spirit is love, joy, peace, forbearance, kindness, goodness, faithfulness, gentleness and self-control. Against such things, there is no law.
PSALM 24:1The earth is the LORD’S, and all it contains, The world, and those who live in it.
LUKE 16:10-12 The one who is faithful in a very little thing is also faithful in much; and the one who is unrighteous in a very little thing is also unrighteous in much. Therefore if you have not been faithful in the use of unrighteous wealth, who will entrust the true wealth to you? And if you have not been faithful in the use of that which is another’s, who will give you that which is your own?
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTShawn:
Do you struggle with aligning your view of money and wealth with the Bible or are you looking for a deeper Biblical perspective? Over the next few weeks, we’ll dive into a study examining God’s design for wealth and work. Let’s get some perspective. Welcome to another episode of Christian Financial Perspectives. My name’s Shawn Peters. I’m joined as always by my co-host, Bob Barber. And today we’re going to be bringing you part one of a three-part series where we give you an overview of a Bible study that Bob had actually developed a number of years ago.
Bob:
Originally this was called the Seven Pillars of Biblical Stewardship. You might remember when we did that and that was so intensive, and I remember when we had Pat Hail here, who was a pastor and he would go in and train churches how to conduct this study.
Shawn:
It was a great study, but the one downside to it is that you kind of almost needed this – teach someone how to teach it for it to be impactful. And I mean, man, how many churches, entire churches actually went through that study? It was quite a few.
Bob:
I think there was 80 to 100 in Texas. So I came up with a simplified version called “Biblical Viewpoints of Money and Wealth” that you can do on your own or you could do in a small group, you just pop right in.
Shawn:
It’s also a seven week study.
Bob:
It is.
Shawn:
But it is written in a way that if you’re on your own or if you’re in a group, you can jump in and it is very scripture heavy and scripture led. So a lot of questions, we’ll give you some examples, but a lot of questions where you have a question and here’s two to four scriptures. Go read the scriptures and then okay, what did the scripture tell you?
Bob:
I guess you could say don’t let the thinness of this fool you. Yeah, because there’s so much scripture.
Shawn:
It’d be about four times as thick if you included all the scriptures.
Bob:
Exactly, yeah. Because it’s very, very scriptural heavy. But if you’re looking for a Bible study that talks about what God’s word says about money and how this applies to real life, this is the study and it’s been years and years of development. The first, like you said, the first series was that Seven Pillars. That was like 10 or 12 years ago. And then this took me another couple of years to come up with this and we’ve had it and we’ve had it out a few years and I think it’s time to bring it back and let our new audience know about this.
Shawn:
So if this ends up being something that you’re interested in, we will have the link in the description or you can just go straight to Amazon and search for “Biblical Viewpoints of Money and Wealth”. And this is what the current cover looks like. So it should be fairly easy to find. But alright, so this seven week Bible study just is a deep dive into what God’s word says about money. The foundation of the study is looking at how Biblical wealth comes from, belongs to, and it should honor God as well as how that wealth should be distributed wisely. Biblical wealth, just kind of a definition, it’s providing for those God has entrusted to us, supporting the church, spreading the gospel, sending out and supporting missionaries, providing for God’s family, feeding the hungry, clothing the poor, sheltering the homeless, healing the sick, educating the homeless, protecting the innocent, and providing for widows and orphans.
Bob:
There’s a lot in there.
Shawn:
It’s a lot. Yeah.
Bob:
But that is probably, that’s kind of a synopsis of the whole study.
Shawn:
Exactly, right there, big picture. So Bob, why don’t you go ahead and let our listeners and viewers know what are the seven viewpoints that are covered within the seven weeks?
Bob:
Alright, well, the first week what we do, and this is really the foundation of the study, is we look at the difference between a Biblical and a secular worldview. And like I say, that’s the foundation. And then the second week we look at the differences between an owner, what an owner’s job is and what a manager’s job is. And we are going to go into some examples of these first three today, two or three minutes just for each one. Week three covers the Biblical worldview of work and retirement. Week four looks at the difference between secular and Biblical council when it comes to finance. Week five covers money and wealth from a Biblical worldview. Week six covers giving and blessings from a Biblical worldview. And then week seven covers properly leaving an inheritance and a legacy for the following generations. So what we’re going to do today for just a few minutes is we’re going to give you an example of those first two to three weeks of this study. And that first week, the scriptures that we use and looking at what’s the difference between a Biblical worldview and a secular worldview – as we look at Galatians of 5:16-23, Exodus 20:1-17, Proverbs 3:3-6, 1 Corinthians 13:4-7, and John 14:6. And hopefully all that, if you’re watching YouTube, this is going to be up on the screen.
Shawn:
Yeah, one correction. It was Exodus 20:1-17.
Bob:
What did I say?
Shawn:
I don’t know, but it wasn’t that.
Bob:
Oh, okay. Well thanks a lot. Yeah, I’m going through all these very quickly. So today, we’re just going to look at the very first scripture and give you an idea of what this feels like. So we’re going to look at Galatians 5:16-23. Shawn, if you would read that for us,.
Shawn:
Starting at verse 16, “So I say walk by the spirit and you will not gratify the desires of the flesh; for the flesh desires what is contrary to the spirit and the Spirit, what is contrary to the flesh. They’re in conflict with each other so that you are not to do whatever you want, but if you’re led by the spirit, you’re not under the law. The acts of the flesh are obvious – sexual immorality, impurity and debauchery, idolatry and witchcraft, hatred, discord, jealousy, fits of rage, selfish ambition, dissensions, factions and envy, drunkenness, orgies and the like. I warn you as I did before, that those who live like this will not inherit the kingdom of God.” In verse 22, “But the fruit of the spirit is love, joy, peace, forbearance, kindness, goodness, faithfulness, gentleness and self-control. Against such things there is no law.” So if you’re doing this on your own, I’m sure you can have a good internal monologue, but definitely in a group, just this first scripture really brings a lot of discussion to the group where we can very clearly see the differences between these two views between the flesh or the world, secular view and the spirit or the Biblical view.
Bob:
If you’re not watching YouTube, but I’m going to show this to you, you can see here what we do is we have one column that we put for the Biblical worldview and another column for the secular worldview. So you write down those and you put ’em right against each other and you’re really able to see a Biblical worldview is love and joy and peace, patience, kindness, gentleness, and self-control where a secular worldview is sexual immorality and discord and anger, all those areas like that. So that really gives you a good idea, and there’s a lot of discussion that goes into this.
Shawn:
That’s right. So then in the second week the study covers the difference between an owner and a manager. The differences between an owner and a manager become clear when you consider examples like a restaurant owner. So the manager has duties and responsibilities to carry out the owner’s wishes. And in the same way, God owns everything and we are merely managers of the resources that he has temporarily given us stewardship over.
Bob:
And we use that example in the study. You think about a restaurant franchise, some people own five or six of them, the owner’s not there, but the manager is. The manager is expected to do a good job for the owner or the manager gets fired.
Shawn:
So examining your personal possessions through this lens, through that lens of that you’re a manager, not an owner, is very illuminating. Whether you’re talking about your car, home, job – in all of those, who’s the real owner? Is it you or is it the Lord? What duties do you have as the manager and how well are you carrying out God’s wishes with these resources?
Bob:
We do that same thing where you put the owner at the top, you list the duties of the owner, you have the manager and you list the duties of the manager. And you can see the differences in the two of those. And looking at Psalms 24:1, which is one of our scriptures, it says God is the owner of everything, “The earth is the Lord’s and all that dwell within it and everything in it.” So it’s really taking that tight fist where it’s all mine and you’re releasing that and saying, God that belongs to you. And then being a good steward. Are you being a good steward with that car that God’s given you? Are you taking good care of it, keeping it clean, things like that. That’s what God wants to see. He wants to see that we’re being good managers with what he’s enabled us. Which brings us to the scripture of Luke 16:10-12. That’s a very important scripture talking about if you wonder why sometimes, why don’t I have more? Well, maybe it’s because you’ve got to do well with the little things first before you do good with the bigger things.
Shawn:
That’s right. So Luke 16:10-12, “The one who is faithful in a very little thing is also faithful and much. And the one who is unrighteous in a very little thing is also unrighteous in much. Therefore, if you have not been faithful in the use of unrighteous wealth, who will entrust the true wealth to you? And if you have not been faithful in the use of that which is another’s, who will give you that which is your own?” To make sure we’re not getting too much into prosperity gospel theology here. Really what this verse highlights is not a guarantee that you’re going to be given a whole lot more, but you look at it as this is a prerequisite to where if you really are expecting God to bless you with more and you have not been faithful with what he’s already given you, why would you expect him to give you more?
So you should also reference the “Parable of the Talents”. The first two, they did well, they both increased the value and then the first one didn’t do anything with it. He just stuck it in a hole, buried underground and it was taken away from him. Well, you need to show that you’re being faithful before you expect God to, for whatever reason, give you more, I think is the main thing there. But it’s not a guarantee either. It’s also okay if he never really gives you any more, we’re still called to be good stewards of what he’s blessed us with.
Bob:
So moving on to week three, and then that’ll be all we cover for today. We explore the Biblical perspectives on work and retirement. There is such a different view. Work appears in the Bible over 500 times, where retirement appears one time and it’s when the chief priests at the age of 50 shall quit their regular duties at the tent of the meeting, but teach. See, they’re teaching. They’re mentoring the younger generation. So retirement is looked at as a time of mentoring others and teaching others, not just checking out of life.
Shawn:
I think the key there is that you’re still active, you’re just in a different phase of your life, different level of responsibility. And keep in mind, work existed before the fall, before sin entered into the world.
Bob:
That is always a good point. And I think people don’t realize that. I mean, they do realize if they go back and read scripture, but they don’t think about it, they think well work is a curse. No, work is not a curse. Work is a blessing. It provides significance. And especially if you’re a Christian, the amount of ministry you can do Monday through Friday at your job is 10 times the amount than you can do on a Sunday morning. I believe in going to church – absolutely – and being with the body of believers. But that’s just a couple of hours where you’re at work 30 to 40 hours a week.
Shawn:
That’s right. So that’s all we’ll cover for today. But the seven modules, if you will, for the study, they build on each other, but they also can, to an extent, stand on their own. Our prayer is that God will use this Bible study in people’s lives to help renew their minds and transform people in how they view and handle money through the lens of how God sees it. So if this study sounds interesting or beneficial to you, we would ask that you consider purchasing your own copy, whether it’s just for yourself or if you wanted to do it with a small group, the link will be in the description. You can also, like I said, we said earlier, go on Amazon search for “Biblical Viewpoints of Money and Wealth”. You can buy however many copies you want. We have it on there basically at cost. We’re not trying to make money on it, we just want to be able to make sure the information’s available, get it out there.
Bob:
And I’m also here if you ever want to just talk about it since I did develop the study. If you want to talk about some ideas about teaching it and promoting it in your church or your small group, please give us a call or text us.
Shawn:
At (830) 609-6986. And don’t forget to share this video with others who might find it beneficial as well. That’s all for today. God bless.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 196 – Avoid These Foolish Financial Mistakes Part 2Avoid These Foolish Financial Mistakes Part 2Try to avoid committing these common, financial mistakes!
More episodes >>
Want to avoid money regrets and costly financial errors? Eager to learn common pitfalls that trip up even seasoned investors? Well, in this episode of our 2 part series on “Foolish Financial Mistakes”, Bob and Shawn cover 10 more financial mistakes to steer clear of that can cost you dearly.
Instead of blaming others for financial mistakes, they emphasize using wisdom and taking responsibility for one’s financial decisions. It’s important to seek out professional financial advice from a fiduciary based advisor who has your best interests in mind. As always, please share this content with anyone who you think may benefit from it!
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn Peters“Avoid These Foolish Financial Mistakes Part 1”Crown MinistriesWebsiteInstagramFinancial Peace UniversityWebsiteBible Verses In This EpisodePROVERBS 28:26Those who trust in themselves are fools, but those who walk in wisdom are kept safe.
JAMES 1:5If any of you lacks wisdom, you should ask God, who gives generously to all without finding fault, and it will be given to you.
JEREMIAH 29:11For I know the plans I have for you,” declares the Lord, “plans to prosper you and not to harm you, plans to give you hope and a future.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTShawn:
Want to avoid money regrets and costly financial errors? Eager to learn common pitfalls that trip up even seasoned investors? Well today, we’ll be covering part two of our discussion on foolish financial mistakes to steer clear of that can cost you dearly. Let’s get some perspective.
Welcome to another episode of Christian Financial Perspectives. My name’s Shawn Peters. I’m joined as always by my father-in-Law, Bob Barber. And today we’re going to be going into part two of our “Foolish Financial Mistakes To Avoid”. We covered a few scriptures on the last episode. If you haven’t already taken a look at that, I would definitely recommend you stop now, click the link in the description, go back and watch that. But we’re going to start with the scriptures and then we’ll kind of get into this next section. So Proverbs 28:26, “Those who trust in themselves are fools, but those who walk in wisdom are kept safe.”
Bob:
Amen. James 1:5, “If any of you lacks wisdom, you should ask God who gives generously to all without finding fault and it will be given to you.”
Shawn:
And Jeremiah 29:11, “‘For I know the plans I have for you,’ declares the Lord. ‘Plans to prosper you and not to harm you. Plans to give you a hope and a future.'” As we alluded to a little earlier last week, we did cover part one of this foolish financial mistakes series, if you will, that these mistakes, they could cost you thousands if not hundreds of thousands of dollars. If you didn’t see it, again, pause now, click the link in description, go check that out. Today in part two, we’re going to be continuing that. Bob put this together from, what is it, over 30 years at this point?
Bob:
Yeah, that’s right.
Shawn:
Of experience.
Bob:
I’ve seen ’em over and over. Just same mistakes over and over and over. And that was really interesting when I put this together, how, gosh, it only took me about 15, 20 minutes and then I worked on it from there. But these were coming into my mind as fast as I could write ’em down, bottom line.
Shawn:
And there’s a lot of crossover. So obviously part of that too was kind of bringing that down to a total of 20, so we didn’t have too much.
Bob:
It was actually more than 20. And that’s why we did this in a two-part series because there’s so much to take in. So this is not to hurt anyone, this is to help you. This is to say don’t do these. And all of us have been guilty of these mistakes and that’s the way you learn, probably gives you gray hair. That’s why I got a lot of it.
Shawn:
So hopefully these don’t insult you in any way, but they are helpful and beneficial. That’s why we like that Jeremiah scripture. So without further ado, let’s get onto number 11 of the 20 that we’ll be discussing today. Which number 11? Blaming someone else for your financial mistakes pointing at someone.
Bob:
Shawn, if I point at you.
Shawn:
Oh yeah.
Bob:
Okay. If I point at you, I got one finger point at you, how many I got pointing back at me?
Shawn:
That’s right. You got three.
Bob:
I got three pointing back at me. And I’ve seen this, I’ve seen people blame like an older generation. You’re the reason I’m making all these financial mistakes. You’re the problem behind my financial problems. And you can’t do that. You’ve got to own up to it and you’ve got to take responsibility. And we have such good tools today like Financial Peace University by day, wonderful program. We’ve got Crown Ministries that you can go to. There’s a lot of good information out there to teach yourself, including our program. If you listen to this every single week, we’re giving you an education about not making foolish mistakes that financially cost you.
Shawn:
And we do that because, with our mission and vision as a company, one of those things is that we want to expand God’s kingdom through the influential gate of finance. And so we feel that doing programs like this, even when we’re talking about something that maybe is a little harder to hear, we want to make sure that we’re honoring the Lord and we are trying to help people with sound Biblical and financial advice. So Financial Peace University is great. Crown has a lot of great resources available, including they actually have one-on-one mentoring. That is really useful if you’re someone who’s in debt or maybe you just got out of it, but you’re trying to get some basics together, they have a really good program for that that they do as a nonprofit.
Bob:
They really do. Yeah.
Shawn:
Alright, well number 12, investing all your money in one asset class, like say only residential real estate or…
Bob:
Tech.
Shawn:
Tech, energy stocks, or even just cash.
Bob:
You like what I have – in cash.
Shawn:
We grow safely because of inflation and loss of purchasing power.
Bob:
I have seen, “I’m not going to invest in anything. It’s just going to be all in cash.” Well, you’re investing in cash. In cash, right?
Shawn:
And then you lose money because of inflation.
Bob:
Number 13 is allowing others like the internet, email, TV ads to manipulate you into making long-term bad financial decisions like buying gold.
Shawn:
Yeah, that’s the most common.
Bob:
And I know just recently we had a program on that. Because they’re out there and they want to manipulate you and they want to manipulate you because they’re making some very high commissions.
Shawn:
That’s right.
Bob:
On selling you a certain product.
Shawn:
There are better and worse, obviously, places and companies you can buy precious metals through, but from what I’d seen of the averages, it’s anywhere from what, 3% to 10% for a decent company. So whatever you’re buying, you’re paying that commission either on top of or as part of your total, what you actually get back. Some of the companies are at 30% and 50% just very predatory.
Bob:
When you told me that and you were doing that research, I was like, you got to be kidding me.
Shawn:
And then here’s the catch. Even if it is one of the better companies where it’s the 3% to 10% range, what that also means then is when you want to sell it back, you’re going to be paying a transaction cost again. So whatever that percentage is when you initially buy it and when you sell it, obviously that goes back into it. And so, if you just look at precious metals and see what was the price at this time to this time, you got to make sure you take into account all those additional transaction costs.
Bob:
Yeah, correct. And taxes by the way.
Shawn:
Yeah, exactly. Yeah. So overall, long story short, we talked about before, but for precious metals, it’s not that you can’t ever make money on it, but it’s typically a shorter term possible option because in the longer term it doesn’t do very well compared to an actual diversified portfolio.
Bob:
So number 14, number 14 is procrastination. Boy, this is a mistake I see a lot of people make. They’re trying to wait for that convenient time to come to start saving, start putting money aside, pay off that debt. Lemme tell you, it’s never going to come. The convenient time, it’s never going to come and you just have to start doing it now. So don’t think by waiting you’re getting any farther along.
Shawn:
The best time to start that saving and investing plan is today.
Bob:
And it might start with just saying, I’m not going to drink that $6 cup of coffee every day and I’m going to start saving that extra $6. I’m going to drink it at home and over a month you’re going to now save at least $100, maybe $120 if you did it all 30 days. And then you start putting that aside.
Shawn:
Alright, number 15, spontaneous emotional spending without thinking about the long-term consequences.
Bob:
Boy Shawn, with the apps today.
Shawn:
Oh my goodness. Yeah,
Bob:
On our smartphones, you enter in your credit card information once and there it is and you can just pop, pop, pop, pop. And it’s just so easy now to buy. I see in my neighborhood, I think Amazon and UPS just kind of, they just hang out in their neighborhood and they probably hang out in your neighborhood, too. You probably see ’em every day. You hear those trucks.
Shawn:
Those kinds of services. Bob, they’re such a great example of how a ingenuity and technological advancement and improvements in processes, how they can be such a great thing. But if you’re not careful, they can also have that other edge of the sword and be a really negative with people who don’t practice diligent spending and purchases that because it’s so easy, you can very quickly overspend.
Bob:
Small purchases can add up very quickly.
Shawn:
Right. Alright. Which goes into number 16 then.
Bob:
Number 16, it does go right into it. You know how I feel about this? Using a credit card for everyday purchases instead of a debit card. I am a big believer, I do not believe in using the credit card, even if you say I’m paying it off every day. Credit card companies, they’re not going to stop you and they’re not motivated to keep you inside a budget. Okay. They’re actually motivated the other way to enslave you so that you owe money to them and they can charge you. I mean the interest rates today are like 20% plus.
Shawn:
Or more depending on…
Bob:
It’s just absolutely insane. I was just talking with a Christian brother yesterday and he was talking about, he says, yeah, we pay it off every month. He goes, but then there’s always these extra little things that I see in there and I’m like, where’d this come from? Where’d this come from? If you use a debit card, there’s no way you can overspend. I’m coming up with a program.
Shawn:
And if you do, you’ll get penalized.
Bob:
And I’m just going to give you a little for the future so you’ll know it’s called “Budgeting Simplified”, and I’m going to explain to you how you get paid into one account and then you have a second account that you use for your expenses and you only put a certain amount over there each week. For those of you that don’t like budgeting with today, with your bank app, you can go online and you can see this is what I have in the balance.
Shawn:
Automatically, you only spend what you actually allocated.
Bob:
That’s right. Yeah, exactly. You just cannot go over where a credit card, they’re not going to call you and say, “Hey, by the way, you went over.”
Shawn:
Oh, it’s the opposite. Jenna and I have had a card for a long time and we get contacted somewhat regularly letting us know, “By the way, did you know that we could increase your credit limit?”
Bob:
Oh yeah. Right.
Shawn:
We don’t need to.
Bob:
Don’t ever.
Shawn:
We don’t come close to using it now.
Bob:
We don’t want to increase it.
Shawn:
That’s just asking for trouble.
Bob:
Alright. Okay. Boy, this is an advertisement I see every single day on tv. I just do not like it. Okay, at all.
Shawn:
Number 17, buying insurance based only on price, not adequate coverage.
Bob:
“Only buy what you need.” That is the most ignorant quote in advertising I have heard – “Only buy what you need.” When you get in an accident, are you going to be happy that you bought as little as possible because that’s what they mean. And I’ve never met anybody that’s been in an accident that bought through one of these companies the minimal amount of coverage, and I mean you can get the minimum can get way down, way down there.
Shawn:
Really what it comes down to is when insurance is being promoted as “by the minimum” or by only “what you absolutely need”, The issue with that is you, it’s kind of forgetting the primary purpose of insurance in the first place, which is risk mitigation. You’re trying to cover a risk that you may not be able to cover out of pocket with cash or otherwise. So you’ve got to look at not just what is the cheapest, but like we said, adequate, you need to make sure that you’ve adequately covered the risk that that situation is causing depending on what kind of insurance it is and buy accordingly.
Bob:
We know Ron First of Christian Insurance Services and he has had people come to him that didn’t buy from him in the first place. And this is not an advertisement for him, but he’s told me some of the stories of people that have bought strictly based on price and not coverage, and it’s heartbreaking. It’s very heartbreaking. It is one of the most foolish financial mistakes you can make.
Shawn:
As a personal, positive story though was that Ron had helped Jenna and I with our auto insurance when she had gotten rear-ended by somebody. totaled the car, but also caused further damage with her back and everything. And one of the things that was just a slight increase in price maybe compared to some other options, but Ron had helped us with the PIP, the personal injury protection. And so it provided so much more money that without even technically waiting for the claim to be filed, we could basically get help with anything related to medical and other types of expenses. And so just those little things like that.
Bob:
It doesn’t cost that much more.
Shawn:
No, it doesn’t. Yeah. So number 18, not having an estate plan with a will or trust, medical and financial power of attorney. Yeah.
Bob:
I have seen families destroyed by this. I just got a call last week, Shawn. It was heartbreaking. It was actually from a mom that’s an older mom and the son’s wife passed away, and there was no will at all and all the bills were being paid out of her account, all of them. So guess what’s happening? There’s no money to pay the bills that needed to be paid because everything was going into her account. Now, he’s got to go through probate.
Shawn:
Before they can get access to anything.
Bob:
Isn’t that crazy? Yeah. I’ve watched this probate sometimes go on for eight or nine months. I’ve seen families fight over inheritances. It’s just foolishness to not to update your estate plan. I say update. Hopefully, you have one and if you do have one, you probably need to update it, too. They need to be updated every two or three years.
Shawn:
Yeah, that’s right. Number 19, not monitoring your bank account balances and spending frequently. No one else is looking at this for you.
Bob:
You got to look at it. You hear, well, I don’t want to have the app because I’m scared of somebody’s going to hack me. If you monitor your bank account every day, you’ll know if somebody’s hacked you. This is where when we get to the program where we’re going to talk about budgeting simplified. This can help so much and all the banks have apps today.
Shawn:
And number 20, the number one mistake by far, not having a financial plan or blueprint and updating it at least once a year, especially before you make a large withdrawal. It’s a little bit of a long one, but by far the most important one.
Bob:
And I say this and you’ve probably heard the statement, I don’t know, maybe you’ve not heard the statement. This is a statement that it’s been around a long time. “No one plans to fail. They just failed a plan.” And kind of goes into the second biggest financial mistake that we shared last week is that we see people all the time selling appreciated assets to buy depreciating ones like a car. And that is a very foolish mistake because you think about you take $50,000 out for a car now, it’s not going to grow and it’s not going to compound to a 100k and it’s not going to compound the 200k, and I’ve said this so many times.
Shawn:
The longer you have, if you just went into retirement, chances are you’ve got 30 years, 20, 30 years. So the longer you have the more costly taking money out of appreciated assets to buy depreciated one like a car impacts you.
Bob:
Well, there you go. There’s 20 of them. Again, if you didn’t hear last week, we’d emphasize you go back and listen to those first 10. We are here to help you with your financial life. With Christian financial advice. It’s fiduciary based advice as well. We do not make any commissions here. We don’t sell commission based products. We’re paid by you, no one else.
Shawn:
That’s right. So give us a call, (830) 609-6986. Visit our website at www.christianfinancialadvisors.com. You can also comment in the video if you’re watching the video.
Bob:
Oh yeah, we wanted to mention this.
Shawn:
If you know someone that might benefit from this content, either this video or any other video that you watch or whatever it might be, feel free to share it with them. This is for anybody that wants to watch. It’s why we put it out there publicly. So if anyone might benefit from this that you know, share it with them. Thank you. And that’s all. God bless.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 195 – Avoid These Foolish Financial Mistakes Part 1Avoid These Foolish Financial Mistakes Part 1Don’t let yourself get caught up in the trap of any of these financial mistakes!
More episodes >>
Want to avoid money regrets and costly financial errors? Eager to learn common pitfalls that trip up even seasoned investors? In this part 1 of 2, Bob and Shawn discuss and provide perspective on foolish financial mistakes to steer clear of that can cost you dearly.
They emphasize the importance of wisdom and provide Biblical scriptures to support their points. Just a few of the financial mistakes discussed include taking stock tips without doing proper research and buying large items on impulse without considering long-term financial plans. So, tune in to learn how to better avoid these top financial mistakes!
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersWhy Traders Are NOT InvestorsInvesting Your ValuesBible Verses In This EpisodePROVERBS 28:26Those who trust in themselves are fools, but those who walk in wisdom are kept safe.
JAMES 1:5If any of you lacks wisdom, you should ask God, who gives generously to all without finding fault, and it will be given to you.
JEREMIAH 29:11For I know the plans I have for you,” declares the Lord, “plans to prosper you and not to harm you, plans to give you hope and a future.
PROVERBS 15:27The greedy bring ruin to their households, but the one who hates bribes will live.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPT[EPISODE]
Shawn:
Want to avoid money, regrets and costly financial errors? Eager to learn common pitfalls that trip up even seasoned investors? Well, today we’ll be discussing and providing perspective on foolish financial mistakes to steer clear of that can cost you dearly. Let’s get some perspective.
Welcome back to another episode of Christian Financial Perspectives. My name is Shawn Peters, and I’m joined as always by my father-in-Law, Bob Barber. And today we’re going to be covering Part 1 of 2 on foolish financial mistakes”. So this is Part 1 of “Avoid These Foolish Financial Mistakes”. We’re going to share some scriptures with you to get started, but please keep in mind if anything said in either of these episodes feels like we’re attacking you or you’re convicted or anything like that, that is definitely not our intent. We want to always tackle more difficult subjects when appropriate, but we want to do so in a way that is always beneficial and done so in a way that allows people to learn and to educate themselves. So never in attack, so sorry in advance, it feels that way if it feels that way.
Bob:
This is a tough subject, but I think it’s important as Christians, and this is Christian Financial Perspectives, that we tackle these tough subjects like this. So we’re going to give you a lot of wisdom. But the Bible speaks of foolishness a lot. And when I pulled up, when I put in the word “fool” and I looked up into the Bible, I was trying to think, what do I call this program? And it came up more than 85 times in scripture. So there’s a lot about that. And it talks so much about wisdom, too. And wisdom is the opposite of foolishness, right? So I think it’s good to start off with some scriptures, and to know that we are coming to you from a heart of compassion with this because we hate seeing people make foolish financial mistakes because they’re so costly.
Shawn:
That’s right. So without further ado, Proverbs 28:26, “Those who trust themselves are fools, but those who walk in wisdom are kept safe.”
Bob:
James 1:5, “If any of you lacks wisdom, you should ask God who gives generously to all without finding fault and it will be given to you.”
Shawn:
That’s right. And Jeremiah 29:11, “For I know the plans I have for you, declares the Lord, plans to prosper you and not to harm you, plans to give you hope and a future,” which I think is just such a great verse on, again, we’re doing this because we want to help people.
Bob:
Exactly right. And Shawn, as I was coming up with this program, many times I’ll come up with this subject matter at 10 o’clock at night, or sometimes I’ll get up in the middle of the night, and I was amazed at how many of these items I came up with and how quickly it was. I mean, literally it was 15 minutes. I had 15 to 20 of these, and I could have kept going. I was at 25 or 30 and I was like, no, we’re not going to share that many. Okay, so today we’re going to have part one, we’re going to go through the first 10 of foolish financial mistakes I see people make, then next week we’ll go through part 2 of it.
Shawn:
And honestly, these can cost you thousands of dollars, sometimes hundreds of thousands of dollars.
Bob:
They really can. Many times you’d be surprised, hundreds of thousands of dollars. And the first one, we’ve mentioned this many times before, but in today’s society it’s nearly a novel idea, but this is the foolishness that we see. Number one is, “Spending more than you earn.” That’s a major financial mistake that people make. You say, well, how do you do that? Credit cards, there’s more going out than coming in. Because of this, we’re going to have a program in a couple of weeks, I’m going to call it budgeting simplified, and we’re going to be talking about how you can simplify a budget that will help you in this category.
Shawn:
And not only for ourselves individually, but on spending more than you earn. That’s a mistake. Continue to pray for our leaders that they would at some point maybe learn to stop doing that, spend less than the tax dollars. So maybe eventually our great, great, great grandchildren will not be in debt.
Bob:
Our country, if you go to USdebtclock.org, you’ll see that we don’t have an income problem. We have a spending problem. I mean, the income is really coming in a lot from taxes and the trillions and trillions, but there’s more going out than coming in. So they just need to learn how their own politicians need to learn how to do this.
Shawn:
So number two, “Selling an appreciating asset to buy a depreciating one.” I would say, Bob, probably the most common with this is when we have a client that wants to take out a large sum of money from a long-term investment account to buy a car or to do a home remodel, or to go on a long big vacation of some kind or just fill in the blank. And what ends up happening is it’s literally one of the worst financial mistakes you can do. Second only, I guess, to spending more than you earn. You give up so much more long-term potential for something that’ll be worth less and less over the years.
Bob:
You’re going in two exact opposite directions because you take $50,000 out for that car. Now that $50,000, by the rule 72’s, we’ve talked about this, it’s not going to double now. It’s not going to grow to 100k and then double the 200k because by the way, it takes the same amount of time for something to go from $50,000 to $100,000, thus from $100,000 to $200,000. And where it hurts so bad is somebody in their older years, maybe they’ve got $700,000 now in their retirement account, well now in their older years, they’re going to have $200,000 less by taking 50k out from an appreciating asset to go put it into a depreciating asset. And you know a car, it’s $50,000 is not going to be worth it in 10, in 10 or 15 years. So yeah, you’re moving in exact opposite directions of each other. Can you imagine an investment doing that? Would you want to invest in anything that you knew was going to be worth about 10%, 20% of what it is in 10 or 15 years?
Shawn:
Yeah. So number three, “Taking financial advice from someone that’s not financially successful.”
Bob:
That’s nearly a no brainer, but you would think not. People do take advice all the time from family members that are not financially successful. I always say, if you want to fly with the eagles, hang out with the eagles, not the turkeys.
Shawn:
But that being said, Bob, I think the other thing to be careful of is kind of the flip side of that is taking financial advice from someone that is wealthy but not from their own hard work.
Bob:
Yes, that’s a very good point.
Shawn:
Someone who inherited a lot of money for whatever reason – it could have been from parents, grandparents, or could have been from life insurance, whatever the case may be. But if someone is wealthy and seems financially well off, but you know that it wasn’t because that they have worked hard to build up their own business or whatever the case may be, I would also avoid taking advice, financial advice from that same person, because just having money doesn’t make you qualified. But if you have a lot of money and you earn that yourself, okay, maybe they’ve got some good advice, then.
Bob:
I would call that 1st generation wealth. Yeah.
Shawn:
So number four, “Allowing emotions and feelings to make financial decisions.”
Bob:
We know that’s a big no-no, don’t we?
Shawn:
Wait, do people struggle with that?
Bob:
Constantly, especially when it comes to buying cars or it comes to buying furniture or it comes to that home remodel. I mean, your countertops are fine, everything’s working good, but you’ve watched HGTV so many times that you think you’ve got to change everything.
Shawn:
Well, it’s not just that, Bob, you’re talking about some of the bigger financial purchases, decisions that happen less frequently. But I think the thing that probably hurts more of us is the smaller ones where you’re browsing, I’m not going to say the name of it, but there are online websites where you can get things within a day or two and more and more companies have moved to that. And when you are kind of in the moment and you see something that’s, oh, it’s on sale, or I saw a friend had this, and you’re like, oh, I’m going to go buy it and look how easy, it’s just, “Click. Buy.” Wait. Wait a little bit on those.
Bob:
That’s your emotions.
Shawn:
Think about do you actually need this? Can you afford to buy this? Or are you just kind of buying it quickly in the moment? Okay. Because those add up quick.
Bob:
That’s exactly right. Okay. I want to cover number five, by the way.
Shawn:
Alright, go ahead.
Bob:
This is what I’ve seen a lot in my 30 plus years in the financial advisory business, is, “Taking stock tips from friends or somebody on the golf course or somebody in your book club…”
Shawn:
Or some influencer, some financial guru online.
Bob:
“…without doing the hours of unbiased research yourself.” And do you really even know how to do that research? A lot of research going into it. Like before we pick a stock, we have 20 elements that we look at on the value side and on the fundamental side. So there’s a lot of different elements, plus just how is it trading over or under, its long term.
Shawn:
There’s a lot. But even with that, Bob, we are not saying, okay, we’re going to take client money. We’re going to buy, 50% is going to go into this one stock. Well, no, for what we’re doing, whether it was a small amount or a lot of money, we still diversify that. And so of maybe 50 stocks that we end up narrowing things down to, we still don’t know that those are for sure going to appreciate. It was just we’ve done the best we can with the research trying to remain unemotional, unbiased, and then decide, all right, well these are the ones that we think have the best chance.
Bob:
Based on mathematics.
Shawn:
Exactly. But it could go either way. And so anyone that tells you, “Oh, you need to buy this stock,” or, “Oh, this is going to do great,” they have no idea.
Bob:
Alright, we’re halfway through our 10 today. This is why we’re doing two parts. Number six, “Trying to get rich quick.” Therefore, this results in many unwise decisions I’ve seen over my years. It just doesn’t work.
Shawn:
Bob, it’s so hard because even just in the last few years, when you look at how much home prices have gone up and just real estate in general and renting and the cost of just things overall, the desperation, I get it. I understand why more and more people, probably some of you watching this, why you have the FOMO, the fear of missing out or I need to take advantage of this thing because I got to find a way to get ahead quicker. But the reality is, is that there’s nothing new under the sun, right? The scams, the get rich quick, it’s been around for thousands of years. It’s not new. So even though I know it’s very tempting, and even though I know it’s more appealing, if you hear about something that’s like a way to get ahead and you can bypass stuff, the reality is, is it’s not going to work. For every 1 person at worked for, there’s 100 people that lost their shirt.
Bob:
This next one goes right into that. So number seven, for every one person this works. 10 million, it doesn’t work. Okay.
Shawn:
“Gambling.”
Bob:
Gambling on lottery tickets. When they ask me, I want to buy a lottery ticket in a convenience store, you asked the wrong person.
Shawn:
To be more broad gambling. It’s gambling, lottery tickets, online gambling, going to casinos, the sports pools, the fantasy football type stuff. And you know what? Look, if you’re playing with your friends, that’s fine, but just don’t get sucked into that because the house always wins.
Bob:
We have a good scripture for that. Proverbs 15:27, “The greedy bring ruin to their households, but the one who hates bribes will live.” I think there’s a lot of bribing going on in the gambling business.
Shawn:
If you’re watching this, please send Proverbs 15:27 to your local representative, state and federal to remind ’em of that.
Bob:
That’d be a good one. Alright, here goes number eight. Now this is one I’ve seen a lot too, “Loaning money to others expecting to get paid back.” Not going to happen. Okay. You loan money to a family member, the odds of getting paid back and if you’re expecting to get paid back, that’s foolishness. You’re probably not going to get paid back.
Shawn:
Yeah. You’re doing an uncollateralized loan. And yeah, it’s not worth it.
Bob:
Number nine, we’re down to the last two is, “Day trading.”
Shawn:
Now, Bob, tell me how you feel about this one. Do you have any opinions, thoughts?
Bob:
Well, I will tell you this.
Shawn:
We will put a link in the description. We did talk about how…
Bob:
In my 30 years of financial advice, okay. I personally, and I’m sure they’re out there. I know they’re out there.
Shawn:
You’ve been doing this almost 37 years as of the recording.
Bob:
Yeah, that’s true.
Shawn:
Almost four decades.
Bob:
I’ve never met a single person over a long period of time that’s been successful at day trading. I’ve met ones that are successful in the short term, but I’ve never met a single one that is successful in the long term. Not one, Shawn. Now I know, I’m positive they’re out there. Without a doubt, they’re out there.
Shawn:
But you can do the math, Bob. There’s some out there. But if you look at the total number of people doing it, what percentage of those are actually successful at it? Well, it’s the very, very small minority.
Bob:
So you understand these last three kind of play in right into that. Trying to get rich quick. The gambling – well, not loaning money. That’s not trying to get rich quick – and day trading.
Shawn:
Traders are not investors. We’ll link that in description. It’s a good one. If you want more on why we think this is a mistake to avoid.
Bob:
We have a whole program on that. So anytime you see somebody writing and they’re saying, “Investors are thinking this today, investors are thinking that today.” No, it’s traders that are thinking this today. Or that investors think in the long run. They think in 3, 5, 10 year increments, not one day or one week or even one month increments.
Shawn:
I do know one guy that has been really, really successful with the opposite of day trading, but actual long-term investing. Some of you may have heard of him, especially if you’re watching the finance channel, Warren Buffett. He seems like he’s done pretty well with long-term strategies. So I don’t know, maybe it works.
Bob:
It’s funny. I have Warren Buffett’s 10 guidelines for buying a stock, and that one is so funny – it’s just so funny. He says, “Don’t buy cigar butts.” And I’m like, what does that mean? What do he means by that is don’t buy a company that is that bad. It’s already been used up. Okay.
Shawn:
Yeah, that’s a good way.
Bob:
Alright, here’s number 10. Number 10, go ahead.
Shawn:
Buying anything large on impulse, not counting all the cost and seeing how, or even if, it fits into a long-term financial plan. And again, this does kind of cover a couple of the ones we cover, but large purchases, what would you say that would be, Bob? Anything a thousand dollars or more?
Bob:
Oh no.
Shawn:
$500 or more?
Bob:
No large, I would say $10,000, $15,000. But anything beyond like $20,000, you definitely need to get with your financial advisor, put this in a financial plan and see how this is going to affect you over the long run. And is it a wise decision? Oh, Shawn, this is enough today. I mean, that’s so much to absorb, these 10, and this will be up on our website. Next week, we’re going to cover 10 more. Like I said, I came up with about 25 of these in a matter of 15 to 20 minutes. It’s amazing. I was spitting this out so fast I could hardly write.
Shawn:
I asked Bob to please split it up. So, you’re welcome those watching and listening. Well, that’s all for today. But in the meantime, or whenever you happen to watch this, if it’s already after the second episode came out, we’re here. We both work at Christian Financial Advisors. We’re fiduciary based. And our goal in what we do day to day is helping people avoid making foolish financial mistakes and to be successful in the long run, all while glorifying God and how you do it. So if you have questions, comments, want to talk to us, whatever, give us a call. Text us, (830) 609-6986. You can visit our website, www.christianfinancialadvisors.com. All that should also be on the screen, all that. But thanks again for joining us and as always, God bless.
[CONCLUSION]
We invite you to listen to all of our past episodes covering many financial topics from a Christian Perspective. To make sure you don’t miss any of Bob’s upcoming episodes you can subscribe to Christian Financial Perspectives on iTunes, Google Play Music, Spotify, or Stitcher. To learn more about integrating your faith with your finances, visit ciswealth.com or call 830-609-6986.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 194 – Using 1 Timothy 3 To Find A Financial AdvisorUsing 1 Timothy 3 To Find A Financial AdvisorWe apply the characteristics of 1 Timothy 3 to that of a qualified Christian financial advisor.
More episodes >>
Are you searching for a financial advisor who exemplifies Christian character and integrity? Do you want their guidance grounded in Biblical truth versus worldly thinking? Bob and Shawn share the qualities to look for in a financial advisor based on scripture, specifically 1 Timothy chapter 3.
1 Timothy 3 outlines the qualities of an elder or deacon in the church, and we believe that these qualities are also important in a financial advisor. The qualities include being temperate and a good teacher, i.e. someone can explain financial concepts in a way that is understandable. Listen in to find out what other traits we believe a Christian financial advisor should possess!
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodeDANIEL 6:4Then the commission to government affairs; but they could find no ground for accusation or evidence of corruption, because he was faithful, and no negligence or corruption was to be found in him.
PROVERBS 31:10-12An excellent wife, who can find? For her worth is far above jewels. The heart of her husband trusts in her, And he will have no lack of gain. She does him good and not evil All the days of her life.
PROVERBS 15:1A gentle answer turns away wrath, But a harsh word stirs up anger.
PROVERBS 25:28Like a city that is broken into and without walls Is a man who has no control over his spirit.
PHILLIPPIANS 4:8Finally, brothers and sisters, whatever is true, whatever is honorable, whatever is right, whatever is pure, whatever is lovely, whatever is commendable, if there is any excellence, if there is anything worthy of praise, think about these things.
1 PETER 4:9Be hospitable to one another without complaint.
2 TIMOTHY 2:24-25The Lord’s bond-servant must not be quarrelsome, but be kind to all, able to teach, patient when wronged, with gentleness correcting those who are in opposition, if perhaps God may grant them repentance leading to the knowledge of the truth.
1 PETER 5:8Be of sober spirit, be on the alert. Your adversary, the devil, prowls around like a roaring lion, seeking someone to devour.
MATTHEW 5:5Blessed are the gentle, for they shall inherit the earth
LUKE 12:15Then He said to them, “Beware, and be on your guard against every form of greed; for not even when one has an abundance does his life consist of his possessions.
LUKE 16:10He who is faithful in a very little thing is faithful also in much; and he who is unrighteous in a very little thing is unrighteous also in much.
1 CORINTHIANS 14:20Brethren, do not be children in your thinking; yet in evil be infants, but in your thinking be mature.
PROVERBS 22:1A good name is to be more desired than great wealth, Favor is better than silver and gold.
PSALM 119:160The sum of Your word is truth, And every one of Your righteous ordinances is everlasting.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTShawn:
Searching for a financial advisor who exemplifies Christian character and integrity? Want their guidance grounded in biblical truth versus worldly thinking? Today we share the qualities to look for pulled from scripture. Let’s get some perspective.
Welcome to their episode of Christian Financial Perspectives. My name is Shawn Peters. I’m joined as always by my co-host and Father-in-Law, Bob Barber. And today we’re going to be covering 1 Timothy 3. It’s a little bit long, so we’re not going to read the entire scripture, but using 1 Timothy 3 to find a financial advisor. So 1 Timothy 3, for those that aren’t aware, in the Bible has many qualities that describe an elder or deacon – the qualities they should have if they’re going to serve in that capacity within the church. Bob and I both believe that these are also great qualities to look for anyone giving you financial advice, especially if they are a Christian. So I would encourage you to go check out 1 Timothy 3 for yourself. Feel free to pause this program, come back to it, or read it afterwards. It’s up to you. But in today’s episodes we’re going to discuss how these various guidelines, these qualities, can help you find your next financial advisor, if you’re looking for one while you’re watching this, which I feel like is probably likely. If you clicked on this video, probably might be what you’re looking for.
Bob:
Well, Shawn, I know that it’s this time of the year when people are looking for a financial advisor. It’s usually January, February and March, April. And then I know everybody kind of takes a break during the summer and then they come back around September, October in those years. And that seems to be the months when I’ve noticed from my experience in this business for many years is when people are looking for a financial advisor. So I thought this would be a great topic.
Shawn:
Which also makes sense. We totally get it. November, December, people are focusing on their families and then in the summer, kind of the same thing, things going on with the family. So yeah, we get it.
Bob:
You cannot go wrong If you look for a financial advisor that has these virtues, has these traits.
Shawn:
Again, especially if they’re a Christian. So first quality: above reproach, meaning free from sinful habits and behaviors.
Bob:
You had a great scripture here. Go ahead, Shawn.
Shawn:
Daniel 6:4, “Then the commissioners and satraps began trying to find a ground for accusation against Daniel in regard to government affairs, but they could find no ground for accusation or evidence of corruption because he was faithful and no negligence or corruption was to be found in him.” I mean, that’s a great one.
Bob:
Yeah, it is. It is. And so the first quality, there’s going to be 14 of these by the way, is to look for a financial advisor that is above reproach.
Shawn:
That’s right. That has integrity in their work and their personal life. Are they known to be ethical and honest?
Bob:
Now the second approach, there might be a financial advisor that may not be married, but if they are, this is one that we see. Of course, this is for an elder and a deacon, 1 Timothy 3. But I think it’s also a good one to look for as far as a financial advisor that they are faithful in their marriage if they’re married. Proverbs 31:10-12. Now I know this says an excellent wife, but could say husband as well there. Okay, Proverbs 31:10-12, “An excellent wife who can find for her worth is far above jewels.” I’ll say that that’s definitely true.
Shawn:
Yep. Amen.
Bob:
With my sweetheart of 40 years, “The heart of her husband trusting her and he will have no lack of gains. She does him good and not evil all the days of her life.”
Shawn:
That’s right. Yeah. Really what it comes down to is a strong, lifelong marriage indicates the responsibility and the commitment. And Bob, I think you and I can both agree that our wives have made us better men.
Bob:
Without a doubt.
Shawn:
And so I think again, that is also a very positive thing to help with whatever advisor you’re possibly looking at, if they’ve been married for a while, probably going to be a little more on track and responsible and tempered, which goes in the next quality. The third quality: temperate, meaning they’re calm and reasonable. Proverbs 15:1, “A gentle answer turns away wrath, but a harsh word stirs up anger.”
Bob:
So look for advisors that communicate calmly and don’t react harshly when you ask them questions like, why are you asking me that?
Shawn:
That’s right.
Bob:
You don’t want an advisor like that. You want one that’s going to come back with compassion.
Shawn:
Which goes right along with some of our many other episodes. We’ve talked about keeping emotions out of financial decisions. If you have someone who is not temperate, they’re not calm, they’re not reasonable, they react harshly, probably not a good sign because if they’re helping to manage your money or helping you with making those financial decisions and they can’t keep their emotions out of their basic communication with you, not a good sign.
Bob:
Which goes into another trait just kind of like this. Okay, they’re self controlled.
Shawn:
That’s our fourth quality.
Bob:
Meaning they don’t act impulsively and they regulate their emotions.
Shawn:
That’s right. Exactly. Proverbs at 25:28, “Like a city that is broken into and without walls is a man who has no control over his spirit.”
Bob:
And you have some additional insight here that you put down, Shawn.
Shawn:
Do they think through decisions versus acting on emotion?
Bob:
The fifth quality that we see out of the 14 is: are they respectable? Respectable meaning they’re honest and they’re good and they’re proper. The scripture that I know you chose for this, Shawn, was from Philippians 4:8, “Finally, brothers and sisters, whatever is true, whatever is honorable, whatever is right, whatever is pure, whatever is lovely, whatever is commendable, if there is any excellence, if there is anything worthy of praise, think about these things.”
Shawn:
That’s right. So something to apply, okay, how does the scripture apply? How does this quality apply? Well, are they involved in respectable community groups and activities? Are they involved in their church? Are they involved in small groups? What kind of things are they doing to be respectable and known in their community? Our sixth quality: hospitable meaning friendly, generous, and welcoming. 1 Peter 4:9, “Be hospitable to one another without complaint.”
Bob:
I definitely like doing business with people that are friendly.
Shawn:
It’s a lot easier.
Bob:
It’s a lot easier that are generous and welcoming. And I think that that would be somebody that… a trait you would definitely want to look for in a financial advisor. Seventh quality: teacher. This is something, it comes about me naturally. I love teaching. But will they teach you? Are they able to teach? Will they explain and show you how their financial advice applies?
Shawn:
And for this we have 2 Timothy 2:24-25, “The Lord’s bond servant must not be quarrelsome, but be kind to all, able to teach, patient when wronged, with gentleness, correcting those who are in opposition, if perhaps God may grant them repentance leading to the knowledge of the truth.”
Bob:
So can they explain concepts in a way that help you to understand it? And Rachael’s told me over the years. She says, “Bob, you speak in a different language when you start saying PE ratios and things,” all the different jargon that we use. Many times I do look at a client across, we’re doing a client review and they’re like, I’m not sure what that means. Well, I need to explain. That’s the price to earning ratio.
Shawn:
As they say, explain in plain English. So for those who aren’t a professional advisor, can you explain things to where someone can understand what you’re trying to say? Yeah. So our eighth quality: sober, meaning not given to drunkenness or overdrinking, 1 Peter 5:8, “Be of sober spirit beyond the alert, your adversary, the devil prowls around like a roaring lion seeking someone to devour.”
Bob:
Yes. So look for somebody that has self control and has sound judgment.
Shawn:
That’s right. You want to do our ninth quality, Bob?
Bob:
The ninth quality is: a gentle person, meaning they’re mild tempered, they’re kindhearted, and they’re meek. That’s a really big thing today, being meek. Matthew 5:5 says, “Blessed are the gentle for they shall inherit the earth.” And do they come across as being patient when you’re talking to them?
Shawn:
That’s right. That’s right.
Bob:
And humble and caring.
Shawn:
So our 10th quality: generous and unselfish, not a lover of money.
Bob:
Now that’s a big one in the financial industry.
Shawn:
That’s right. So Luke 12:15, “Then he said to them, ‘Beware and be on your guard against every form of greed for not even when one has an abundance, does his life consist of his possessions?'”
Bob:
That’s why I like that we don’t do commission based products, and we’re fiduciary based. We want to do what’s in the best interest of our clients.
Shawn:
That’s right. Not what might get additional commission or extra paycheck.
Bob:
Yeah. So are they focused on serving you and your goals versus their own financial goals?
Shawn:
That’s right. The 11th quality: a good manager, meaning they manage their business and personal life well. Luke 16:10, “He who is faithful in a very little thing is faithful also in much. And he who is unrighteous in a very little thing is unrighteous also in much.”
Bob:
That’s one of my favorite scriptures. I quote this one a lot because a lot of times people say, “I just don’t understand why I can’t get ahead?” Well maybe you need to start small and then you can get larger instead of thinking, I’m just going to go large.
Shawn:
Number 12.
Bob:
A mature Christian. I think this is very important. If you’re looking for a Christian financial advisor, they need to be mature in their Christianity. In 1 Corinthians 14:20 is one that Shawn found here, “Brethren, do not be children in your thinking. Yet in evil be infants, but in your thinking, be mature.”
Shawn:
“But in your thinking, be mature.”
Bob:
That’s right. Yeah. Be mature. And it takes years of reading God’s word and understanding how to apply that. And if you’re looking for Christian financial advice and what the Bible has to say about it, I mean there’s over 2000 scriptures of what the Bible says about stewardship. So this is a good quality to look for. So we got two more. 14 of ’em.
Shawn:
Hang in there. All right. 13th quality: reputation, a good reputation in their community. Proverbs 21:1 states that, “A good name is to be more desired than great wealth. Favor is better than silver and gold.”
Bob:
And that reputation comes from years. It takes a while to get a good reputation. You don’t just get it overnight.
Shawn:
So, what do others say about their character and service?
Bob:
Good to ask around.
Shawn:
Yeah, and I mean you can even ask, if you want, many advisors will ask some of their clients if it’s okay for you to contact them, direct one-to-one and see like, “Hey, well what’s it like working with this person?”
Bob:
I think this is where reviews come in sometimes, too.
Shawn:
Yeah, It can.
Bob:
Alright, the last quality, I know there was 14 of these and there’s a lot. The last one is if you’re looking for a Christian financial advisor is: do they have a biblical worldview where truth is based on scripture and is not relative. And this world today is trying to make truth more and more relative. It’s not, contrary to popular opinion. It’s so much easier when you have the foundation. And that foundation is in Jesus Christ and that foundation is in His word. Truth was the same a thousand years ago. It’ll be the same in a thousand years. And it’s the same today. It’s not relative, contrary to popular opinion.
Shawn:
And for this one we have Psalm 119:160, “The sum of your word is truth and every one of your righteous ordinances is everlasting.
Bob:
Bottom line, do they advise using biblical principles?
Shawn:
That’s right. Well, thank you for sticking around with us. That’s all we have for today. We really hope you enjoyed this episode and God bless you.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 193 – 14 Characteristics of Financially Successful Christians14 Characteristics of Financially Successful ChristiansLive financially successful by incorporating these Biblical principles into your daily life.
More episodes >>
Are you wanting to pursue financial success without compromising your faith? Are you eager to cultivate Biblical values that enrich your life? In this episode, we’ll explore 14 traits of prosperous Christ followers. It is important to not associate your net worth with your self-worth, because we are so much more than that!
Just a few of the characteristics of financially successful Christians include loving God, being generous, a humble spirit, and seeking wise counsel. These traits are not about chasing wealth, but rather living a life that is focused on loving God and others. God often blesses those who bless others.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This Episode1 TIMOTHY 6:10For the love of money is a root of all kinds of evil. Some people, eager for money, have wandered from the faith and pierced themselves with many griefs.
PROVERBS 21:20The wise store up choice food and olive oil, but fools gulp theirs down.
PROVERBS 13:11Dishonest money dwindles away, but whoever gathers money little by little makes it grow.
LUKE 12:16-21[Parable of the rich man who built bigger barns]
ACTS 20:25Now I know that none of you among whom I have gone about preaching the kingdom will ever see me again.
PROVERBS 15:22Plans fail for lack of counsel, but with many advisers they succeed.
MATTHEW 23:12For those who exalt themselves will be humbled, and those who humble themselves will be exalted.
ACTS 2:42-44They devoted themselves to the apostles’ teaching and to fellowship, to the breaking of bread and to prayer. Everyone was filled with awe at the many wonders and signs performed by the apostles. All the believers were together and had everything in common.
JOHN 3:21But whoever lives by the truth comes into the light, so that it may be seen plainly that what they have done has been done in the sight of God.
PROVERBS 10:9Whoever walks in integrity walks securely, but whoever takes crooked paths will be found out.
ECCLESIASTES 4:9-10Two are better than one, because they have a good return for their labor: If either of them falls down, one can help the other up. But pity anyone who falls and has no one to help them up.
PROVERBS 17:17A friend loves at all times, and a brother is born for a time of adversity.
PROVERBS 22:7The rich rule over the poor, and the borrower is slave to the lender.
PROVERBS 23:4Do not wear yourself out to get rich; do not trust your own cleverness.
COLOSSIANS 3:23Whatever you do, work at it with all your heart, as working for the Lord, not for human masters.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTShawn:
Pursuing financial success without compromising your faith? Eager to cultivate Biblical values that enrich your life? Well, today we’ll explore 14 traits of prosperous Christ followers. Let’s get some perspective.
Welcome to another episode of Christian Financial Perspectives. My name’s Shawn Peters. I’m joined as always by my co-host and father-in-Law, Bob Barber. And today we’re going to be talking about 14 characteristics of financially successful Christians. So this is going to go a little bit in the face of the fear of missing out on whatever new cryptocurrency just dropped, or “Follow this course and sign up and you’ll be successful.” But since this is a Christian financial show, we are going to be talking about those financial areas as well as supporting these characteristics with scripture. I feel like that’s applicable, right Bob?
Bob:
I think so. We’ve got a scripture for nearly every one of these.
Shawn:
That’s right. We do.
Bob:
14 of them.
Shawn:
That’s right. So our first scripture for you today, 1 Timothy 6:10, “For the love of money is a root of all kinds of evil. Some people eager for money have wandered from the faith and pierced themselves with many griefs.” Now, Bob, I feel like this is one of the more often misquoted scriptures out of the Bible because you hear so many times, money’s the root of all evil. No, no, no, no. Money is a tool.
Bob:
That’s right.
Shawn:
The love of money is a root of all kinds of evil. And really you could insert love of anything other than God if it’s just an object can cause a lot of problems.
Bob:
Well, that’s why in the 10 Commandments it says, be careful of idol worship.
Shawn:
That’s right.
Bob:
Have no other gods before me because people can make money their God. I’ve seen that happen before, Shawn. That’s what it’s really warning us about. Yeah, money’s just a tool like you say.
Shawn:
Alright, we’ll just cut right there and we’re good. It’s a good scripture. Thanks for joining us. So first, love God, seek him, and realize he is the owner, not you. And that’ll definitely make it a little harder to have a love of money if you’re loving God first and know that everything belongs to him in the first place. So Bob, why don’t you get us started out on our first characteristic of financially successful Christians?
Bob:
Well, this is a really novel idea, this first one. By the way, when I developed these, I had no idea it was going to end up being 14 characteristics.
Shawn:
You just started writing.
Bob:
Yeah, that’s what I always do. The Lord lays it on me. Many times, it’s like two o’clock in the morning, so it’s kind of crazy. But this is such a novel idea. Spend less than you earn.
Shawn:
To say this, that our politicians…
Bob:
It’s nearly obnoxious, isn’t it?
Shawn:
Our politicians have never heard of this concept.
Bob:
Yeah.
Shawn:
Because at the end of the year, whatever the budget was for their area, if they didn’t spend it, well they got to quickly spend it because otherwise they won’t get it for next year.
Bob:
Well, you think about this first one, Shawn. It is a characteristic of a financially successful Christian. It’s also a characteristic of pretty much anybody that’s financially successful as they spend less than they earn.
Shawn:
Yep, yep. And what scripture do we have for that one?
Bob:
Proverbs 21:20, “The wise store up choice food and olive oil, but fools gulp theirs down.” They eat it all up, right?
Shawn:
Yep. Yeah. And then some…like our politicians.
Bob:
Hey, we’re picking on our politicians.
Shawn:
I know, but they deserve it.
Bob:
They can’t help it. I was looking on the debt clock. You bring in 5 trillion in a year and they spend like 13 trillion or something. I mean, it’s crazy.
Shawn:
Yeah. Seems like those numbers should be flip flopped.
Bob:
It’s like the government doesn’t have an income problem. They got a spending problem.
Shawn:
That’s right. Exactly. So number two, save and invest wisely. Proverbs 13:11, “Dishonest money dwindles away, but whoever gathers money little by little makes it grow.” If ever there was a scripture to go against the idea of get rich quick schemes, there you go.
Bob:
This does it. Right on it. The third one is I just noticed that financially successful Christians are not caught up in materialism. It’s not about the latest car you’re driving or the biggest house, the bigger house. They don’t get caught up in that. Again, that kind of goes into this first one or two of them. By the way, I was looking at a video the other day about the top 10 most appreciating cars. About 5 of those top 10 were the luxury cars that depreciate 40% and 50% in the first two or three years. It’s just crazy. And that’s an example of getting caught up in materialism thinking I got to have the latest new car that costs $80,000.
Shawn:
I remember a friend of mine a few years back, he was the third owner of this Mercedes car, and I’m not going to name the specific one, but the original owner, the first owner who bought it, it was like 120 something thousand dollars car.
Bob:
Wow.
Shawn:
He was the third owner. This car is only, I think at this point, it was maybe five years old, third owner, five years later, he bought it for like 50k.
Bob:
Yeah, you can save a lot. And I think what goes really good with this scripture of not getting caught up in materialism is the example given to us in the 12th chapter of Luke about the barns. Building. I’m going to go build bigger barns and then I’m going to build bigger barns and bigger barns. I love Ron Blue. I’ve quoted him many times and there’s the old question. He says, “We’ve got to ask and answer in our own mind, ‘How much is enough.'” And I think that really deals with materialism.
Shawn:
It’s kind of a long passage. But Luke 12:16-21 if you want to read that about the parable of the rich man who built bigger barns. Number four, givers both monetarily and physically. Acts 20:25, “Now I know that none of you, among whom I have gone about preaching the kingdom will ever see me again.” Now this one, it’s a little confusing. Maybe we should include the couple other verses around it. But this really just comes down to not just giving money, but giving your time, donating your talents. At your church, you can be a very generous giver, but it doesn’t have to necessarily be money.
Bob:
It could be both. I hope it’s both.
Shawn:
Yeah. It should be both. But the point is you also shouldn’t just, oh, you just throw some money at it. But hey, show up and help volunteer for the kids. Volunteer for Sunday school. Lead a group.
Bob:
I know two of our clients, they go to smaller churches, they mow the yard for the church. So you think about that, that’s physically helping out. They get on a riding lawnmower and go for it.
Shawn:
Number five, seeks and takes wise counsel.
Bob:
The part is takes. They seek it out, but they also believe in accepting wise counsel when it’s given to them. They’re humble. They’re not like, “I know it all.”
Shawn:
Yeah. It’s kind of the opposite of, most people have a tendency of giving unsolicited advice.
Bob:
Yeah, that’s true.
Shawn:
But it’s a very different skill to actually take advice and not be prideful or boastful and think, oh, I already know everything. And Bob, from working with people over the years, it’s really common that the more money people have, there is a tendency to get kind of a big head on your shoulders and think, oh, I have all this money and all of a sudden I’m knowledgeable in all areas of life somehow.
Bob:
Well, especially with sudden wealth.
Shawn:
Sudden wealth especially. So just be careful of that. Seek and take wise counsel. None of us know everything.
Bob:
It’s my favorite scripture, you hear me quote it a lot. Proverbs 15:22, “Plans fail for lack of counsel, but with many advisors, they succeed.”
Shawn:
That’s right. Amen. Yeah, I love that one. We quote that one very often.
Bob:
Here. We do, we do.
Shawn:
Number six, humble and love the Lord.
Bob:
Yeah, they do.
Shawn:
Matthew 23:12, “For those who exalt themselves will be humbled and those who humble themselves will be exalted.”
Bob:
I don’t think we can add much more to that. Being humble is a great characteristic.
Shawn:
Can’t go wrong.
Bob:
Nope.
Shawn:
Number seven, you want to do number seven?
Bob:
Boy do I see this one. Successfully financial Christians are so loyal to their churches, they’re weekly church goers, and they just, like you say, like we were talking about earlier, they support their church by giving of their time and their talents. And the scripture that goes with this I think is fantastic. You’ve heard this one before, but it’s from Acts 2:42-44, “They devoted themselves to the apostles teaching and to fellowship to the breaking of bread and prayer. Everyone was filled with awe at the many wonders and signs performed by the apostles. All the believers were together and had everything in common.” I love my church and I know you love your church too, and it is just so part of that extended family that I think we all need.
Shawn:
That’s right. Number eight, live by a Biblical worldview. Very much believers here of that, so John 3:21, “But whoever lives by the truth comes into the light so that it be seen plainly that what they have done has been done in the sight of God.
Bob:
Their truth is in solid ground. It’s in God’s word. It’s the same as a thousand years ago. It’s going to be the same in a thousand years. Truth is not relative, contrary to popular opinion today.
Shawn:
Yeah. The culture and overall technology and things like that might change over time and what happens to be trending right now, obviously changes from day to day and week to week, but people are still people. We’re still created in God’s image and we aren’t going to really see that change anytime soon.
Bob:
Now, this next one, another very, very strong one for successfully financial Christians, they have a very strong moral compass. They’re extremely honest. They’re truthful, they’re loyal. And Proverbs speaks of this in Proverbs in the 10th chapter, in the ninth verse (Proverbs 10:9), it says, “Whoever walks in integrity walks securely.” You never have to be thinking about what you’re saying behind you. If I lied, you always have to be thinking about what you said, right. But if you’re walking security in the Lord and you’re truthful, you never have to worry about covering up your tracks. “But whoever takes crooked paths will be found out.”
Shawn:
Yeah. That’s such a good scripture for the danger of lying.
Bob:
Lies always come out.
Shawn:
Yeah. Remember, let all your words be true, but not all true things should be said, because sometimes you could technically share something that’s true, but it’s not going to build the other person up, and it’s definitely not going to put you in a good light sometimes, but if you do speak, make sure your words are true. What is that? If you don’t have anything nice to say, don’t say anything at all.
Bob:
Yeah. Well, it talks about in scripture the tongue being the rudder. You got to be careful about that little tongue getting out.
Shawn:
Number 10, low divorce rate, long-term married or long-term marriage, Ecclesiastes4:9-10, “Two are better than one because they have a good return for their labor. If either of them falls down, one can help the other up, but pity anyone who falls and has no one to help them up.”
Bob:
Shawn, Rachel and I are coming on our 40th year of marriage now.
Shawn:
Wow. She’s put up with you for that long? I mean, you guys have been married. That’s such a blessing.
Bob:
Hey, I put up with her ,too. Okay.
Shawn:
That’s true. It goes both ways, but
Bob:
I’ll tell you what, Jesus Christ is the glue that holds us together. You’ve never seen two opposites, so opposite, attract, but her strengths are my weaknesses and vice versa. But you know what happens when there’s a divorce? And I’m not saying we know there are circumstances.
Shawn:
Sure.
Bob:
We are not out here to judge anyone, but divorce just, it breaks all of the assets right in half.
Shawn:
Yeah. This is not a condemnation of course. This is just more of an observation that statistically those that are more successful, especially believers – Christians, that is low divorce rate, long-term marriage – because if you’ve been building assets your entire marriage for 50 years, 40, 50 years, versus maybe it was close to that time, you cut everything in half. It’s a little harder to get successful again because you just lost half of it. So practically speaking. Alright. Number 11, deep roots in their community with long-term friends and family. Proverbs 17:7, “A friend loves at all times and a brother is born for a time of adversity.”
Bob:
I like this. I know you picked that scripture, Shawn. That’s a really good scripture that goes with that. And those roots are so important to set. I can say y’all, my family has been in Texas since 1830. I mean, we got some roots that go way, way back, and those roots really, it’s just something that I know that foundation is there, Shawn, and it means so much to know that.
Shawn:
That’s right. Number 12, debt-free except for possibly a mortgage. Proverbs 22:7. I know we’ve shared this one before on the show, but Proverbs 22:7 says, “The rich rule over the poor and the borrower is slave to the lender.” I think Dave Ramsey would probably agree with that scripture.
Bob:
Absolutely. You got it. Number 13, financially successful Christians, you wouldn’t think this, but they don’t wear themselves out to get rich. That’s number 13. Proverbs 23:4, “Do not wear yourself out to get rich. Do not trust your own cleverness.”
Shawn:
That’s a good one. And our last one, number 14, loyal to their employer’s job and hard workers if they’re not already retired. Colossians 3:23, “Whatever you do, work at it with all your heart as working for the Lord, not for human masters.” I mean, that scripture’s pretty plain, right? You’re not working hard because you have to or because your boss is making you, you’re working hard and doing a good job because you’re doing it for the Lord. Whatever you do in this life, you’re doing it for the Lord and you’re representing him on this earth.
Bob:
So there’s 14 of them. And we’re not preaching prosperity theology.
Shawn:
No.
Bob:
No. We’re just saying that these are characteristics that I’ve noticed, and sometimes people go, why can’t I get ahead? Look at these characteristics and set those roots down and live that honest life and get involved in a church in a small group and form those long-term friendships.
Shawn:
Bob, we didn’t have this written in the script, but just going through all 14 of these with you today, it came to my mind that there’s some common themes with this. And like you said, we’re not talking prosperity gospel here or something like that, but notice that all 14 of these traits, they all really point back to loving God, loving other people.
Bob:
They do.
Shawn:
And having a servant mentality. None of this is actually chasing money, chasing wealth, chasing prosperity. It’s taking care of what’s been given to you, putting God first, putting other people first, and so if wealth comes, it wasn’t because you were chasing it. It’s just a byproduct of living in that way, typically.
Bob:
And you don’t live this way to be wealthy.
Shawn:
Yeah. You just live this way. It’s good living as a believer.
Bob:
You do these things and you have these characteristics and follow them. It just kind of happens. Yeah.
Shawn:
That’s more or less all we got for you today. The whole point though of today’s program is Christians that are millionaires, they don’t associate their net worth with their self-worth. I think that’s, if you take away anything from that is whatever your net worth happens to be, that is not what it’s determining your self worth.
Bob:
And that’s why I didn’t call this from millionaires. I said, financially successful Christians, I mean, what is financially successful doesn’t necessarily mean that you have a million dollars or even that you have $500,000 or $300,000 success comes differently to all of us. It doesn’t matter what house you live in, it doesn’t matter what car you drive, but do you love the Lord? Do you love others? And like you say, have that servant and humble mentality.
Shawn:
It’s just a different mindset than the way of the world. Well, that’s all we have for you today. Thank you for joining us. God bless, and hope to see you next time.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 192 – Are Rental Homes The Worst Way To Invest In Real Estate?Are Rental Homes The Worst Way To Invest In Real Estate?Learn about REITs and what could be a much better investment than a typical rental home.
More episodes >>
Considering becoming a landlord through rental property? Do the returns justify the hassles involved? After insurance, mortgage payments, repairs, and/or marketing costs, a rental home isn’t the cash cow you might think it is. Bob and Shawn discuss the pros and cons of rentals while providing some alternative options to consider.
Instead, Real Estate Investment Trusts (REITs) may be a better option for the average investor. They explain that REITs allow investors to access a diversified portfolio of properties across various sectors, such as industrial, retail, lodging, healthcare, and more.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodeECCLESIASTES 11:2Invest in seven ventures, yes, in eight; you do not know what disaster may come upon the land.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTIntro:
Considering becoming a landlord through rental property? Do the returns justify the hassles involved? Well, today we will discuss the pros and cons of rentals and provide some other options to consider. Let’s get some perspective.
Shawn:
Welcome to another episode of Christian Financial Perspectives. I’m Shawn Peters, joined as always by my co-host and Father-in-Law, Bob Barber. Today we’re going to be talking about investing in real estate. Obviously there are a lot of options within that topic, but what we’re really going to be focusing on today is presenting some of the common options available to the average investor. So we’re not talking about a super high net worth individual here. We’re talking about those with less than a million dollars, overall, that they might be investing in real estate. Now, unfortunately, I had to kind of drag Bob in kicking and screaming for this one. I know, Bob, you hate talking about real estate.
Bob:
Oh, just hate it. Oh yeah, absolutely. No.
Shawn:
No. In all seriousness, Bob, you can’t stay away from real estate. I do know that.
Bob:
I love real estate, always have loved real estate. Shawn, my dad was in real estate for 45, 50 years. So I come from a background of real estate and really understand it, and I saw a lot of the mistakes that he made.
Shawn:
Which kind of makes sense with your career path then, because you went from your dad having that background, and then you went into more of the finance business side of the home building and then eventually into investment management, financial advice.
Bob:
Yeah, that’s exactly right.
Shawn:
So yeah, so today the primary things we’re going to be covering is rental homes. That’s one option that the average investor, and that for most people, I think that are the fit in within that category of under a million dollars. That is probably the first thing people think of if you say invest in real estate.
Bob:
Without a doubt.
Shawn:
Single family rental home. So we’re going to be covering that, pros and cons, we’re also going to be covering real estate investment trusts. We’ll kind of go over a little bit of what that is and the two different kinds. So if you’re waiting for us to talk about the pros and cons of investing in a large apartment complex with a couple million dollars or a large commercial, we’re not really going to.
Bob:
But you could do that through a real estate investment trust.
Shawn:
You could. Yeah. Okay. But anyway, without further ado, Bob, would you like to start us off on rental homes?
Bob:
I will. Rental homes are an interesting subject to talk about. We’ve had many podcasts, at least three or four in the past, out of our 180 to 200, I know we’re coming on 200 podcasts. And talked about just the entire episode has been about rental homes and is it a good investment today? We’re just going to talk a few minutes about it.
Shawn:
We’ll link that in the description. By the way, for those of you who want to see something specific on the details of a rental home and the math behind it, we’ll link that in description.
Bob:
Yeah, it goes way back. Yeah, we’ve done a couple of them, but in my opinion, Shawn, rental homes are the worst way to invest in real estate.
Shawn:
I’m so shocked. I didn’t see that in the script at all.
Bob:
Now, why would I say that rental homes are the worst way to invest in real estate? Well, one of the reasons is the tenants you have to deal with. You don’t have diversification. It’s just in one spot. But the other thing is just the yield itself. The actual yield, not appreciation.
Shawn:
The math, basically.
Bob:
When you look at the math, I went out a couple of days ago and we’re in the Austin, San Antonio area. So I looked at a suburb of Austin, Buda, or Kyle, Texas. I don’t expect of this you up north to know where that is, but just think of the…
Shawn:
Between Austin and San Antonio.
Bob:
It’s just one big city, by the way. Then I came closer to home, which is in New Braunfels, where we are, which we’re closer to San Antonio, and Buda is closer to Austin, but I found that the prices were about the same. And in our area, about a 2000 to 2200 square foot home was around that $500,000 – $600,000 range, even as we speak with the interest rates that have gone up. So I looked and I found a lot of them for sale, as you know right now with the high interest rates. So I looked in this area, you can do this, by the way, on a realtor app, and you can do the same thing.
Shawn:
Don’t just take a word for it. This is just what Bob found.
Bob:
You do the filter and you do “buy”, and then you can just go to the filter and say “rent”, and you’ll see what those homes are renting for. So I found a lot of homes for rent in the for sale areas probably because things are moving slower, and I found the rent to be between $1,800 – $2200 per month. So if you take those numbers and the range of 500k to 600k, I’m just going to use $550,000.
Shawn:
Split the difference.
Bob:
Right in the middle. And let’s say rent’s on the high side. Let’s say it’s 2200 a month that you’re receiving in rent. Take that, multiply that times 12, you’re at $26,400 in gross rental income. Sounds good so far.
Shawn:
So far. Okay. $26,400 gross.
Bob:
But here in Texas we got the property tax, and I know in a couple other states they have some high property taxes as well, which computes like in the Kyle Buda area at 2.19%. So the property tax is about $10,000 a year.
Shawn:
So now we’re down to $16,000.
Bob:
Got it. And then take another $1200 or $1500 away from that for the insurance.
Shawn:
So let’s just say $1200. Okay.
Bob:
So bottom line is you’ve moved that gross rental income from $26,000 down to $15,200 after just, Shawn…
Shawn:
Just taxes and insurance.
Bob:
What about your time or if you hire a property manager?
Shawn:
Or if there’s some sort of maintenance issue where something breaks overflows, water heater breaks down.
Bob:
So the way you do this is you take that $15,200 and you divide it by 50, and that’s going to give your yield. Shawn, say what that yield is.
Shawn:
2.76% per year.
Bob:
Is that crazy?
Shawn:
Which, even under normal conditions, that is barely above average inflation. And it’s below what we’ve been seeing recently.
Bob:
And Shawn, you realize this is if you pay cash.
Shawn:
That doesn’t even factor in a mortgage.
Bob:
If you finance today, you’re going to be in a major negative cashflow position. So the only thing you can rely on is the appreciation in that case. This just doesn’t make sense to me.
Shawn:
That could be a whole other topic. If any of you are curious, look at the actual change in average prices of homes over the years. When I hear about people talk about, oh, look how great the appreciation is over time, it’s a similar number.
Bob:
It’s about inflation. So it hangs right with 3% to 4% inflation, and we’ve been in a 10 year period of ultra low interest rates that were artificially stimulated by the Fed. And those days are over, folks. They’re over. Get used to interest rates being back to where they are today. Go to tradingeconomics.com and put in the average means for interest rates and the fed rate, and you’ll see that. We’re right where we should be with interest rates.
Shawn:
So basically to summarize it, rental home, even if you buy it with cash, you’re still in this example, you’re still looking at less than 3% average return, assuming no additional time for the time you’re putting in to doing anything. You don’t have a property manager. You’re not spending any money on marketing to try to get a new renter whenever the renter leaves and the lease is over. No money for annual repairs, none of that. That’s just, that’s basically your gross.
Bob:
Shawn. I’ve never seen one. And we have a worksheet if you want to see the worksheet. I’ve never seen one in my entire career that gets over 4%. And today, CD rates at 5% plus. So why would you do that?
Shawn:
Why take that risk?
Bob:
You may say because of the appreciation. Okay. So now we’re going to get into what, I feel, is the easiest and best way to invest in real estate.
Shawn:
Which is a REIT or real estate investment trust. So what exactly is that, Bob?
Bob:
It buys a diversified portfolio. It could be housing, it could be apartments.
Shawn:
But it’s not a home. It’s maybe hundreds of homes or thousands of homes or apartments or multiple apartment complexes.
Bob:
It could be healthcare, it could be hospitals, it can be anything real estate. There’s ones that own billboards.
Shawn:
Okay.
Bob:
Because it’s all about generating income, by the way.
Shawn:
Point being is you purchase this one position or make this one investment to give yourself access to multiple properties.
Bob:
That’s correct.
Shawn:
Across various sectors and industries. So within that though, there are two types. I want to make sure we make very clear. There are publicly traded and there are privately traded REITs. So before we get into – which today we’re really recommending the publicly traded REIT option, we’ll go with that. But Bob, why would we say to people to avoid privately traded REITs?
Bob:
I’ve been down the road, Shawn, I’ve been down the road with both of them, and the privately traded REIT really locks you in. If you get into a privately traded REIT, it may sound really good upfront, like maybe they’re going to give you a 6% or 7% dividend, but then they can pull the rug out from under you. And because it’s privately traded, you can’t do anything about it.
Shawn:
You’ve got to basically get it redeemed by the company.
Bob:
By the company itself, or somebody’s going to come along and give you pennies on the dollar. I’ve seen it.
Shawn:
And if they didn’t manage it well, then all of a sudden you’re kind of in a bad spot because there’s no one really to redeem the shares from you.
Bob:
I’ve seen it and even had some clients experience this, and this is why I veer away from privately traded REITs now, because overnight you can go from $10 a share down to $8 a share without any warning whatsoever. You just get the letter and it’s happened. We’ve had some privately traded REITs go public, and we’ve done very, very well at the same time. But in my opinion, you should stay in the publicly traded real estate investment trust arena.
Shawn:
So just some highlights before we get into the type of REITs. Why do you say the publicly traded then are a better option?
Bob:
Along with just the REIT itself, the reason I like it is there’s no closing cost. There’s no sales commissions, buying or selling. It’s just so easy, and I call it mailbox money because you can invest in these REITs and they all have a certain dividend that they’re paying and you just collect it at the mailbox or electronically have it put into your account. You don’t have to deal with the tenants, you don’t have to deal with the water heaters breaking.
Shawn:
None of that. So going back to compare with the rental home, you don’t have to deal with anybody.
Bob:
One we’re going to talk about later, but I’ll just mention it right now. We’ve put together a diversified portfolio of 30 plus real estate investment trusts across all the different sectors as we’re about to go into. And the yield is beyond 6% plus appreciation. It can depreciated as well, but it’s because it’s going to go with the markets. But you get the appreciation just like you could in a rental home, back to it.
Shawn:
Long story short, publicly traded – a lot of good options. It’s way easier to get in and out of it. You don’t have to deal with tenants like you do with the rental home. There’s no commission sales charges. Great. So Bob, what kind of REITs – we’re going to cover this quick – what kind of REITs are available within the publicly traded space?
Bob:
There’s industrial, that’s warehouses and distribution centers. There’s retail, like large regional malls, outlet centers, grocery, anchored shopping centers, and power centers that feature box retailers, like the big Targets or Best Buys. There’s the lodging and resort hotel type REITs. There’s the office REITs, there’s the residential apartment buildings, student housing, manufactured homes, single family homes, warehouses.
Shawn:
Then we’ve got healthcare, so senior living facilities, hospitals, medical office buildings. We have data centers. So these are services that keep servers and data safe. There’s uninterruptible power supplies, air chill coolers, physical security. Then there’s cell phone towers. I always thought that was kind of an interesting one. Timberland and lumber. Then you have infrastructure for fiber cables, wireless infrastructure, telecommunication towers, kind a little bit of a crossover with cell phone towers, but it is separate. And you’ve got mortgage – So financing for income, producing real estate by purchasing the or originating mortgages, mortgage backed securities, farmland, and outdoor advertising.
Bob:
There you go. 14 different ways. You did good because that’s all the different ways that we can invest in. And when we look at building a portfolio of real estate investment trust, publicly traded, real estate investment trust, we look at all of these different sectors because it really goes with the scriptural principles being that we’re Christian Financial Perspectives of Ecclesiastes 1:2, the wealthiest man that ever lived in the history of the earth, Solomon, he said, “Give your portions to seven. Yes, to eight because you do not know what disaster may come upon the land.” So the reason you want to diversify, maybe office is not the best place to be right now. Of course, housing’s not a good place to be, but the housing REITs have depreciated so much….
Shawn:
Might be a good time to buy.
Bob:
Yeah, because you want to buy when things are down, like cell phone towers. I mean, that’s pretty solid, but the dividend may not be as good on those because it is so solid. So we built this real estate portfolio of approximately 30 different, deep valued REITs using our program looking at value and fundamentals of the REIT. We have two different ways that you can buy it through us. One is we do a buy and hold strategy for at least a year for the capital gain. And that is just 30 basis points a year. That’s what we charge as our management fee. Or you can buy one that’s more actively managed and that’s our 1% fee per year. And you can get in as low as $30,000 to $50,000.
Shawn:
Exactly. And right now the yield, as of recording, was over 6%, plus whatever appreciation or depreciation might occur. So if you’re interested, as always, we’re here. Check us out www.christianfinancialadvisors.com. You can also call or text during business hours at (830) 609-6986. Thank you so much for joining us today and God bless.
[CONCLUSION]
That’s all for now.
We invite you to listen to all of our past episodes covering many financial topics from a Christian Perspective. To make sure you don’t miss any of Bob’s upcoming episodes you can subscribe to Christian Financial Perspectives on iTunes, Google Play Music, Spotify, or Stitcher. To learn more about integrating your faith with your finances, visit ciswealth.com or call 830-609-6986.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 191 – Investing Your Values: Inside Our Non-Woke, Biblically Aligned Stock PortfolioInvesting Your Values: Inside Our Non-Woke, Biblically Aligned Stock Portfolio Learn how we choose and filter out companies for our actively managed, Biblically responsible investment portfolio.
More episodes >>
Tired of “woke” companies that don’t align with your values? Eager to invest in a diversified stock portfolio that targets growth while honoring Biblical principles? You’re in the right place!
In this can’t-miss episode, Bob and Shawn pull back the curtain on our innovative Biblically responsible, non-woke, deep value stock portfolio. Get ready for an in-depth look at our rigorous stock selection process, which carefully evaluates both financial fundamentals and spiritual alignment.
Click here to learn more about our Biblical Responsible Stock Portfolio
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodePROVERBS 27:23Know well the condition of your flock, and pay attention to your herds.
ECCLESIASTES 11:2Give a portion to seven or even to eight, for you don’t know what disaster may happen on earth.
PROVERBS 13:11Wealth obtained by fraud will dwindle, but whoever earns it through labor will multiply it.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTShawn:
Seeking a diversified stock portfolio aligned with Biblical values? Want to avoid woke companies while still targeting growth? Stay tuned for our Biblically Responsible Stocks portfolio. Let’s get some perspective. Welcome to another episode of Christian Financial Perspectives. My name’s Shawn Peters. I’m joined as always by my co-host, Bob Barber, and today we’re going to be covering our Biblically responsible non-work deep value, actively managed stock portfolio. I’m not going to say it five times fast, Bob.
Bob:
I know that’s kind of a hard one to get out there. Lemme say it, too. Okay. Our Biblically responsible, non woke, deep valued, actively managed, stock portfolio. You’re right, you can’t say that 10 times real fast.
Shawn:
And you can only get this through Christian Financial Advisors. So before we get into it, we are going to cover exactly what we go through to create this model to this portfolio, how we maintain it, things like that. But I want to share a few scriptures on this. First we have Proverbs 27:23, “Know well the condition of your flock and pay attention to your herds.”
Bob:
I think that’s a good one, Shawn, that you picked, too.
Shawn:
And this next one, I know you love Bob. You want to read that one?
Bob:
Well, yes, that’s one of my favorites. Ecclesiastes 11:2, “Give a portion to seven or even to eight for you do not know what disaster may happen on earth.”
Shawn:
It’s a good one for diversification.
Bob:
I think it’s one of the most important investing scriptures in the Bible.
Shawn:
And Proverbs 13:11, “Wealth obtained by fraud will dwindle, but whoever earns it through labor will multiply it.” So the model we’re going to be covering today, or the portfolio, we use within our risk target managed models, we use 50% of the equity in a number of those portfolios. 50% of that, of those equity positions, are managed in the same way. So the same portfolio, whether it’s on its own in a single individual account or if we’re talking about our target risk manage models, we use 50% of the equity in the same way.
Bob:
We’re bringing this to you today because we want you to understand that this is a portfolio you can have that would compliment something you may be already doing on your own that’s Biblically responsible and again, non woke. And basically, this is an introduction of this portfolio to the public that any of you can get with a minimum investment of $50,000.
Shawn:
Per account. So what we do first and foremost is we start our selection process with the US stock market covering the NASDAQ and the New York Stock Exchange. So there’s over 11,000, I think the exact total is 11,500 something. So we’ll say 11,000, but there’s over 11,000 companies to choose from. And we eventually funnel all of those down to 100 to 200 kind of range. So maybe a few hundred.
Bob:
So basically we funnel out about 98% of them.
Shawn:
A lot. Yeah. So we do this based on a financial value score, fundamental score, as well as we’re looking across and trying to whittle things down to the 12 sectors that’s representative of the market. So first thing we do for the value scores, we have 10 litmus tests that are assigned for the value categories such as earnings yield, book value compared to equity, overall profits of the company, cashflow, assets, liabilities, sales, et cetera. There’s a lot that goes into that. But out of these 10 tests and scores, these categories help us to locate companies that are selling for a low price relative to their benefit or some might say their intrinsic value. So what they should be worth based on historical multiples and all these other categories that go into it. Long story short, they’re on sale is how you could look at that.
Bob:
Exactly. And so after we look at the values then, and there’s like I say, there’s 10 different tests there.
Shawn:
And they have to pass at least 8 out of the 10 to even be considered for the portfolio.
Bob:
Right. That’s correct. Then we look at the fundamentals of the companies.
Shawn:
Another 10 tests.
Bob:
It’s another 10 tests that we assign for the fundamentals, litmus tests, as we call it. We look at things like earnings per share, revenue growth, amount of long-term debt, price of companies, stock to the earnings ratio, that’s called a PE ratio. And all these companies, again, must pass at least 8 of 10 of the litmus tests that we assigned to it for the fundamentals. So when we’re applying all these tests, they’ve got to score 80 or above, like you say, that knocks out 98% of the entire market.
Shawn:
So what’s left of the 11,000? Well, we kind of alluded to – presently as of recording, we only have about 1-2% left. So it ends up being around 125 to 150 that actually pass 8 out of 10 or more of both the value scoring and the fundamental scoring litmus test. So this, again, as I mentioned earlier, it does include the NASDAQ and the s and p 500. And from there we now go to our next to last, well, our last screening, but our next to last step if you will. So the last screening process allows us to whittle this list down even further to those that pass our Biblically responsible tests. That way we exclude the woke companies, companies that are not aligned with our values as Christians. And most companies that we’re talking about here, they’re not Christian companies, they’re just companies that, if anything, you could argue that they’re neutral, not really getting involved in either way on some of these key issues. Well,
Bob:
There are companies that are doing what they’re supposed to do if the company makes widgets, they should make widgets. They don’t need to be involved
Shawn:
In
Bob:
Politics, in politics and all of these other areas. So it does get down to the pure companies,
Shawn:
Right? So after applying this, I mean we’ve already gone from over 11,000, now we’re down to 125 to 150. So we’re going to whittle that down a little bit further and we screen out companies that have involvement in manufacturer sale or distribution of pornography, the production or sale of either alcoholic beverages or tobacco products. There are companies that are involved in gambling, abortion, human rights violations, or LGBT activism. I’m not going to name all the letters. There’s too many letters at this point. You get what I mean. So it narrows this down typically to around, say 100 to 120 companies just depending on what we originally started with. So the final part of this is that we narrow down the list even more because the most recent scans that we did, Bob, we had a significant number of companies that passed all the litmus tests, but if we just took from a market cap standpoint, we would’ve been heavily overweighted in regional banks within the financials just because of what had been going on with the regional banks. So this last step is very important because we want to look at the market cap and the sector of each company. So we group the companies across the 11 to 12 sectors.
Bob:
This is where we truly apply the Ecclesiastes scripture to it that says, “Give your portion to seven or eight because you do not know what disaster may come upon the land.” And so what we’re doing here is there’s 12 sectors of the market and we don’t want to invest more than 12% to 15% in any one sector because when you take that scripture and divide that into 100, that’s where you come up with 12-15%.
Shawn:
So that’s the goal. It may fluctuate a little bit. Sometimes we might be a little closer to 18-19% and a little bit lower in another sector. Just kind of depends on what actually passed all the criteria. But the goal is we’re trying to stick right around that 12-15% because we’re narrowing this down to our 50 finalists or for the portfolio. And so, then once we narrow that down and we try to spread the potential positions out as much as possible across the available sectors…
Bob:
We equally weight.
Shawn:
We then equally weight. Exactly. So we use market cap to help us find at least larger companies. We don’t want to be putting too much money into a company that can’t handle the volume. And so that’s why we do – once after we’ve done the market cap, that’s why we do the equal weighting because again, we’re not looking at putting 20% or 30% all in one particular sector. That usually gets us around what, three to four companies in each sector for the portfolio? And this gives us…
Bob:
Which is going to be, again, 50 stocks.
Shawn:
And this gives us our 50 finalists of the most deep valued, fundamentally sound, Biblically responsible, non-woke stocks that we can find in the markets.
Bob:
You did good there.
Shawn:
We do this step to avoid the overweighting, like we mentioned, to avoid the overweighting into any one sector and thereby reduce the systematic risk for that particular sector. So a good example, if we were not applying this and we just took more of a market cap approach, we might end up heavily weighted in the regional banks. Well then if more bad news came out about the regional banks, it would really hurt the portfolio if we had way too much and overweight in that area. So, once a quarter we repeat this whole process for the portfolio. However, we do monitor daily when the markets are open to make sure there haven’t been any major changes in the overall metrics that require a sell. So a good example of that might be, originally a company made it in, they made it into the 50 finalists, but if they go from an 8 out of 10 on the fundamental score and all of a sudden they’re at a 5 or 6 out of 10 because some stuff happens, some structural changes.
Bob:
That may be a good thing because the company might have increased their value by 30% or something and now they’re no longer a deep value company. Because remember, this is a deep value portfolio. This is not considered a high growth portfolio. It’s a value portfolio. So you can compliment it with a growth side of it.
Shawn:
So if the value score changed from 8 or 9 out of 10 down to like 5 or 6, then Bob is exactly right that it wouldn’t necessarily mean we want to liquidate it immediately. On the fundamental score, if that changed, that could, again, not a guarantee, but it could indicate a problem with the company. And so if we ever see something come up like that, we look a little further just because all of a sudden it didn’t pass as many tests we want to liquidate, but it is a, “Hey! Red flag! We need to go look into this a little further, see what’s going on.” Is this a temporary cashflow kind of thing? What’s going on exactly. But that’s something that we monitor on a regular basis and try to mitigate that risk.
Bob:
You know how I love markets, so I’m watching this portfolio at least six to eight times a day. That much. And just to see…
Shawn:
So you don’t have to.
Bob:
Yeah, well I don’t think most people want to go to the process either of this process of looking at 11,000 stocks and going through all of this funneling process, getting down to the most fundamentally, deep value, non-woke, Biblically responsible stocks in the entire market. But we’re introducing this today to where if you would like to get into this portfolio with a minimum investment of $50,000 per account, you’ve got that opportunity and you could compliment…
Shawn:
Visit our website, give us a call, text us.
Bob:
And this can compliment. We do want to point out one thing that this is 100% stocks, this, so this is considered a growth portfolio. Anytime you have 100% stocks of anything, it’s considered growth.
Shawn:
That’s right. But since this is all individual stocks and it’s 50, it would definitely be on the higher end. So, I think a good example would be – it’s just general rule of thumb – if you’re hearing this and it sounds interesting, but you’re not comfortable with seeing your account value drop 20% or more in a six month time period, this is probably not for you. Again, we think a really good strategy, but it does carry a lot more volatility and risk than your average managed portfolio.
Bob:
It could do the same thing on the other side. Okay. Absolutely. And we’ve seen that before, but always future performance is no guarantee based on past performance.
Shawn:
Exactly. Yeah. Insert disclaimer here, right? Yeah.
Bob:
If you would like more information about this, you can call or text us during business hours at (830) 609-6986, or you can go to our website right from there and you can set up an appointment with one of us here at the office. Go to www.ChristianFinancialAdvisors.com.
Shawn:
That’s right. That’s it. Thank you for joining us. God bless. Until next time.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 190 – Selling Financial FearSelling Financial FearMany companies thrive today by selling financial fear. Learn how to avoid it.
More episodes >>
Are you overwhelmed by companies capitalizing on fear to sell overpriced solutions? Don’t fall for it. Bob and Shawn highlight the various means through which companies use fear-based tactics, such as social media platforms, email, television, and text messages. It is important to not fall for these fear tactics.
Instead, unplug from social media, study history to gain perspective, take breaks from screens, engage in constructive and kind activities, and seek God through scripture, prayer, and living by faith. Prioritize your mental and emotional well-being by avoiding this fear-based content and focusing on positive and uplifting activities.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This Episode2 TIMOTHY 1:7For God has not given us a spirit of fear, but of power and of love and of a sound mind.
ISAIAH 41:10Do not fear, for I am with you; Do not be afraid, for I am your God. I will strengthen you, I will also help you, I will also uphold you with My righteous right hand.
PHILIPPIANS 4:6-7Be anxious for nothing, but in everything by prayer and supplication, with thanksgiving, let your requests be made known to God; 7 and the peace of God, which surpasses all understanding, will guard your hearts and minds through Christ Jesus.
PROVERBS 29:25The fear of man brings a snare, But one who trusts in the LORD will be protected.
ECCLESIASTES 7:14When times are good, be happy; but when times are bad, consider this: God has made the one as well as the other. Therefore, no one can discover anything about their future.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTShawn:
Are you overwhelmed by companies capitalizing on fear to sell overpriced solutions? Don’t fall for it. Instead, unplug, help others and seek God’s peace. Let’s get some perspective. Welcome to another episode of Christian Financial Perspectives. My name’s Shawn Peters. I’m joined as always by my co-host, Bob Barber, for those of you who haven’t met us yet. Today, we’re going to be covering selling financial fear and more specifically five ways that you can get away from it and hopefully avoid it.
Bob:
Yeah, deal with it.
Shawn:
Or deal with it. Yeah.
Bob:
Yeah. Today, companies are thriving by selling financial fear and they use every means available. And there’s so many means today, like the social media platforms, Facebook, Instagram, now X.
Shawn:
Formally Twitter. Kind of reminds me almost like with “Prince” or the “artist formally known as Prince”.
Bob:
Email, television, text messages. This is all to scare you into buying their high commission products like gold and silver, the newsletters, the food kits, annuities. When I was a kid, we didn’t have any of this. We had television. We only had three stations, and we were outside all the time. I mean, we would only watch television at night, and this stuff is just, it’s like hovering around us 24/7 it feels like today. And the business of selling financial fear has gotten really big.
Shawn:
Yeah, that’s right. They create a fear of something and just so happened to have the solution for it.
Bob:
And then they use the algorithms to just hit you over and over and over, and over.
Shawn:
The more you interact with it.
Bob:
So this summary of the Salesforce training and make sure this is not the Salesforce you said…
Shawn:
Right. Not Salesforce, the CRM, but it’s a different company, I guess. Salesforce Training.
Bob:
This was interesting as I researched this, that they actually train people to sell fear. Okay. So go ahead.
Shawn:
This is summary on “Fear Sells, So Sell Fear”, and there’s just a real short summary of it. We’ll have a link in the description if you want to take a look at the full article, but the summary of the Salesforce training article says that, “Fear is a more powerful motivator for selling than a desire for gain. An experiment found that people are more willing to take risk to avoid losses than to make gains.” So they’re more willing to take a risk to avoid a loss than they are to take a risk, to make gains. “Appealing to a potential customer’s fear of loss is often more effective than emphasizing the benefits they could gain. Sales pitches can be reframed to tap into fear of loss rather than just a desire for gain.” For example, again, this is coming from Salesforce training. “So for example, how many sales might you lose without training your team versus effectively the same thing, but versus your salespeople will close more sales with training. Fear tactics can be used along with emphasizing benefits. Both desire for gain and fear of loss can persuade potential clients into making buying decisions.” Now, we are not saying that we’re advocates of that, but this is out there. This is part of the training. The idea is that you will sell more units, you’ll sell more subscriptions, you’ll sell more of whatever it is if you tap into people’s fear purposely, their fear of loss, their fear of missing out, as opposed to talking about the benefits being positive.
Bob:
Yeah. Yeah. It’s like negativism sells more than positive.
Shawn:
So if companies are trying to sell things to you, using these tactics for you to make financial decisions, don’t listen. Don’t allow them to dictate this to you.
Bob:
It’s so embedded in scripture and of God that we are not to live in a spirit of fear.
Shawn:
That’s right. Which goes into our first scripture.
Bob:
Yeah. We’ve chosen four really strong scriptures that I think would be good for you to really take into your heart because we’re not supposed to walk around with the spirit of fear. And it says that in 2 Timothy 1:7, “For God has not given us a spirit of fear, but of power and of love and of sound mind.”
Shawn:
That’s right. And Isaiah 41:10, “Do not fear for I am with you. Do not be afraid for I am your God. I will strengthen you. I will also help you. I will also uphold you with my righteous right hand.”
Bob:
You picked Philippians 4:6-7. Oh, this is such a good one. “Be anxious for nothing but in everything by prayer and supplication with thanksgiving let your requests be made known to God and the peace of God, which surpasses all understanding will guard your hearts and minds through Christ Jesus.”
Shawn:
And finally, Proverbs 29:25, “The fear of man brings a snare, but one who trusts in the Lord will be protected.”
Bob:
Oh, that’s my favorite of these four, I think. The fear of man brings a snare, but the one who trusts in the Lord will be protected. Okay.
Shawn:
So how can you deal with all the financial fear selling today?
Bob:
So I’ve worked on this a lot. I came up with five ideas, I think, that will help you and me to deal with all the financial fear that’s hitting us on a daily basis.
Shawn:
So number one, turn off social media.
Bob:
Amen.
Shawn:
The first way to deal with financial fear is to turn off social media, at least temporarily, if not permanently, depending on the platform and how much you struggle with it.
Bob:
I promise you won’t die. You’re going to make it. Okay. We made it without social media for centuries and thousands of years in our world. If you turn it off, it’s not going to hurt you.
Shawn:
So platforms like Instagram, Facebook, and X, formerly Twitter, they use algorithms to target you with fear-based messaging i you’ve ever clicked on any related content.
Bob:
And you know that because if you just click on one thing, now they’re going to come at you with that same thing, right?
Shawn:
Well, not only that, but they also, there’s an incentive because fearful and divisive content gets more interactions. Now they’re negative, but it does get more interactions than happier, positive content. And they want people to engage with content on their platform as much as possible. Companies in general have learned to capitalize on fear via social media to sell products like we mentioned earlier, the high commission precious metals, subscription-based newsletters, “survival kits”, annuities, and more. Once you’re in their algorithm, you’ll be bombarded constantly. Consider taking a social media break again, maybe even permanently, to avoid these financial fear tactics. Out of sight can mean out of mind.
Bob:
Shawn, I haven’t posted anything to Facebook or even gone on Facebook in probably three or four years and it hasn’t hurt me one bit.
Shawn:
I don’t have Facebook on my phone at all anymore. I have Facebook messenger, but that’s only because some people don’t have my phone number or they might want to reach out. But it’s nice because I don’t get sucked in to the algorithm and the newsfeed and all this other stuff because it’s just for messaging.
Bob:
I tell people, just turn it off. The second thing I think is important in dealing with all this is to truly study history. And we know since the beginning of time with Cain and Abel, I mean that was not a good relationship. And you have to ask yourself with all these things that are going on today, is it really new? I mean, there was the Roman Empire conquest to the current state of the world today. I was thinking about just the last 120 years, Shawn. We’ve had World War I and II, we’ve had the Korean War, the Vietnam War, the 911 attacks, and now we’ve got this conflict between Israel and Palestine going on.
Shawn:
Yeah. Oh, the war in Ukraine is still continuing, the renewed conflict with Israel and Palestine, which again isn’t new.
Bob:
And I’ve had a lot of people call me, what about this? What about this? Well, look at the Old Testament. They’ve been fighting for 4,000 or 5,000 years, so nothing is really new under the sun, and it doesn’t help me to live in fear of this. Not at all. And it doesn’t help any of us. So focus on the good and the glass half full, not half empty. This is some good advice my wife gave me years ago, and ever since I’ve really taken that to heart, the focus on the glass half full, not half empty. Because negative thinking, Shawn, it just never gets us anywhere.
Shawn:
And it blocks out wisdom because that negative thinking and that fear, it doesn’t allow you to think clearly. So we have a scripture for this one.
Bob:
And it goes with this one too. Yeah.
Shawn:
Ecclesiastes 7:14, “When times are good, be happy. But when times are bad, consider this. God has made the one as well as the other. Therefore, no one can discover anything about their future.” I think it’s a good one.
Bob:
You know what? We forgot to put one in there in Matthew where Jesus says, “Do not worry. Look at the birds of the air.”
Shawn:
That’s right.
Bob:
And God feeds them. Fear can also push into worry. Which just doesn’t get you anywhere. Okay. So this one kind of goes with that first one about unplugging from media.
Shawn:
Social media. So this was a little different. But unplugging from screens in general. So take regular breaks from your cell phone, computers, tv, even just an hour or two a day at first. Find time to get away from it. Focus on limiting your fear-based news channels to maybe 15 to 30 minutes a day or cut them out entirely as part of just a daily consumption. You don’t need it.
Bob:
You can read a newspaper instead and it doesn’t have all the emotion. Now, some of it does. It’s written in there, but it doesn’t have all the emotion. I have a relative – that I’m not going to go any farther than saying it’s a relative – that keeps Fox News on 24/7. I mean, every time you walk into her house, it’s going, and she even falls asleep to it. And I’m thinking, oh my goodness, I can only watch 15 or 30 minutes of it a day and I start getting depressed, and I just have to turn it off and go watch the Andy Griffith show for a while. You know how I like that?
Shawn:
If you do need some screen time to decompress from the day, watch something positive, wholesome, or educational, something that’s not…
Bob:
Like the Andy Griffith show, right?
Shawn:
Sure. Yeah, yeah. Or again, educational, history, something like that where maybe you’ll learn a little bit about how history tries to repeat itself or rhymes with itself. So number four, do something constructive and kind.
Bob:
It’s hard to be fearful when you’re doing something constructive and kind.
Shawn:
That’s right. And this allows you to be active with doing something and not allow you to dwell on fear.
Bob:
Some ideas I came up with, write some handwritten letters to lift the friend’s spirits. Go out and paint something, make a painting or just paint the house or paint the guardrail. Build something. Take time to garden. Volunteer to help others. Go for a walk or go camping to decompress, but shift your focus from fear to spreading joy and things you cannot control.
Shawn:
That’s right. And so number five.
Bob:
Most important one.
Shawn:
The fifth way – seek God, immerse yourself in scripture, prayer, and living by faith over fear. Listen to praise and worship music instead of the voices selling you on fear, draw close to God who says, do not be afraid. 365 times in the Bible, one for each day of the year.
Bob:
Didn’t know that.
Shawn:
Yeah, so cool. You can look it up. There’s 365 times you see the phrase, “Do not be afraid.”
Bob:
So God’s not called us to live in a spirit of pure, like we said in the beginning. 2 Timothy 17, “For God has not given us a spirit of fear, but of power and of love and of sound mind.”
Shawn:
Yeah. And Isaiah 41:10, “Do not fear for I’m with you. Do not be afraid for I’m your God. I will strengthen you. I will also help you. I will also uphold you with my righteous right hand.” And for those of you who aren’t convinced on at least taking temporary breaks or limiting your consumption of social media, youshould go check out “The Social Dilemma”. It’s on Netflix and it goes into psychology. There’s industry insiders.
Bob:
I watched that about three years ago, and I was shocked after watching it. So if you’re going to watch something…
Shawn:
That’s something educational
Bob:
After you see that, that is very educational, it will open your eyes to what all this social media is doing to us.
Shawn:
That’s right.
Bob:
I hope this has been informative for you today. Shawn and I do not want you living in fear. God doesn’t want you living in fear, and we just hope that this has been informative and these are some good ideas you can take to heart, and it will make 2024 a better year.
Shawn:
That’s right. We’d love to hear from you, too. If you have any other ideas to add to this, feel free to add them in the comments.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 189 – Make This Year’s Goals StickMake This Year’s Goals StickShort summary about the guest or topic.
More episodes >>
Are you among the 92% who don’t achieve New Year’s resolutions? Make 2024 different! Bob and Shawn will show you how to use the SMAC Method – Specific, Measurable, Achievable, and Compatible – to make meaningful and achievable goals.
As Christians, we believe goals should align with God’s plan and also be compatible with one’s values and beliefs. Only a small percentage of people actually achieve their New Year’s resolutions, but that number rises with written goals that are visually placed around the house, car, and even work. This year, it’s time to be intentional and proactive in setting and pursuing goals!
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersPrintable Goals SheetClick On Image To Open Printable VersionBible Verses In This EpisodePROVERBS 16:3Commit to the Lord whatever you do, and he will establish your plans.
PROVERBS 16:9In their hearts humans plan their course, but the Lord establishes their steps.
PHILIPPIANS 3:14I press on toward the goal to win the prize for which God has called me heavenward in Christ Jesus.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTShawn:
Are you among the 92% who don’t achieve New Year’s resolutions? Make 2024 different. We will show you how to use the SMAC method to make meaningful and achievable goals. Let’s get some perspective. Welcome to another episode of Christian Financial Perspectives. My name’s Shawn Peters. I’m joined as always by my co-host and Father-in-Law, Bob Barber. And today we’re going to be covering our goal setting outline for 2024. Now, why should you have goals? Well, because God called us to make a difference in our lives and in others’ lives. And if you aim for nothing, you’ll probably hit it.
Bob:
That’s right, Shawn. I don’t think God called us to live a life of mediocrity, but he called us to live a life of significance and put us here on this earth to make a difference.
Shawn:
That’s right.
Bob:
I believe that every year when it comes down to this point, and we talk about this, this is pretty much our first program of every year. You can rely that in January we’re going to be talking about goal setting because I’ve been doing it for so long. I’m a major goal setter. I’ve got this little, we’re going to show y’all this earlier. I don’t know if you can see this.
Shawn:
We’ll have Jenna put it on the screen.
Bob:
We will talk about it and have Jenna put it on the screen. But basically I have a copy of my goals. They’re not written in here.
Shawn:
Not yet.
Bob:
Not yet. But they’re going to be. And I laminate this little copy and I put one of them in my car, I put one of them on my desk, one in my shower. And I’ve just been amazed over the years how many of the goals that I have hit because I have a target. Like we said, there’s one way to not hit a target that’s not have a target. If you don’t have a target, you’re not going to hit it. And I believe it’s so important that as Christians, that our goals align with God’s plan for our lives. Okay. Scripture reader, always get on you for this. Okay. Because you’re my good scripture reader, Shawn.
Shawn:
I just have such a great radio voice.
Bob:
You do radio, huh?
Shawn:
Well, video too.
Bob:
Podcast.
Shawn:
I have been told I have a face for radio.
Bob:
Oh, okay. Alright. You know what? Me too. I guess that’s why I did it for eight years. Some of y’all might not have known that I had a program that was on San Antonio, Houston, Austin, and Corpus Christi for eight years. That was a long time ago. I didn’t have any gray hair. I looked a lot different.
Shawn:
Yeah, but nobody could tell.
Bob:
That’s true. That’s true. So we got two really good scriptures I want you to read and I want to read this last scripture.
Shawn:
Okay. Alright. So the first one is Proverbs 16:3, “Commit to the Lord whatever you do, and he will establish your plans.” And Proverbs 16:9, “In their hearts, humans plan their course, but the Lord establishes their steps.” Amen. And I don’t remember which versions, but there’s another one that says, A man determines his path in his heart, and the Lord directs his steps. I kind like that version, too.
Bob:
In Proverbs 2 somewhere?
Shawn:
No, it’s the same one. Proverbs 16:9. I just can’t remember which version.
Bob:
Oh, which version. Okay, I got you. I got you, and I liked the one from Philippians 3:14. It’s one of my favorites, “I press on toward the goal to win the prize for which God has called me Heavenward in Christ Jesus.” The important thing is that goals need to align with Christian principles if you’re a believer. And if you’re not a believer, it’s still a wise thing because all good principles are Christian principles. So today what we’re going to do is we’re going to talk about my goals that I’ve set for years. It’s kind of a path I’ve followed and it just never gets old talking about it. Before we do that, we’re going to go over the top 10 goals that people set for New Year’s resolutions over and over. And these are going to sound very familiar and these are in the order of which they set them. Alright, so go ahead Shawn.
Shawn:
So number one, 37% of people set a goal of eating healthier.
Bob:
Especially after all the Christmas cookies
Shawn:
And Thanksgiving and then Christmas and then New Year’s party.
Bob:
It’s usually that diet time around January.
Shawn:
And then the second one, also at 37%, getting more exercise.
Bob:
And that’s all your gyms are going to be really busy right now, just wait until about April or May and it’ll kind of taper off back down to the normal people. But I hope that you’re one that continues to stay up with it if that’s one, you’re starting this year.
Shawn:
Number three again at 37%. These first three were tied, but 37% start saving money or saving more. It’s also a really popular one.
Bob:
Well, this fourth one, it was one of them. It says focus on self-care.
Shawn:
It’s a little more generic, but for…
Bob:
The first two are kind of like that.
Shawn:
But self-care could also be, Hey, I’m going to take time more often for myself to just get away from everything and everybody, maybe read, maybe…
Bob:
You just mentioned one.
Shawn:
Oh, that’s true.
Bob:
That’s the next one.
Shawn:
Whatever people say for self-care, there’s a lot of different subcategories to that I guess. So number five is reading more at 18%. Number six, we have learning a new skill, 15%. Number seven, making new friends at 15%. Number eight, getting a job or getting a new one, 14%. Number nine, taking up a new hobby, 13%. And finally number 10, focusing more on relationships at 12%.
Bob:
Kind of goes with number seven, making new friends. But it is, but those relationships could also be with your mom or your dad or
Shawn:
Your spouse.
Bob:
Your spouse or your grandchildren. Old friends, old high school friends, maybe. I still keep up. It’s funny, in my high school, I mean there was about 300 in my graduating class, but I only really keep up with one. But we keep up with each other all the time. We text each other.
Shawn:
Well, it’s about quality over quantity.
Bob:
We’re kind of two old fellas.
Shawn:
Well, the interesting thing is, so researchers say about 60% of people make New Year’s resolutions, but only about 8% successfully achieve them. Why?
Bob:
Yeah, you realize Shawn, that’s like 92%. I mean they make them, but only 8% of that. So basically you’re throwing out 92%, aren’t you?
Shawn:
Yeah. And that’s of the 60% of people that even make them in the first place. According to a famous Harvard Business School study,
Bob:
83 out of 100 people do not have any clearly defined goals.
Shawn:
And of the 17 people who did have goals, only 3 of them actually wrote them down.
Bob:
So is this saying only 3 out of 100 write their goals down?
Shawn:
Write them down. Yep. So out of 100 people. Now, they’re saying…
Bob:
So I’m one of those 3, I guess.
Shawn:
Yeah. You are. The 60% of people that make resolutions. That was from one research study. But the Harvard Business School was talking about of all people, how many have clearly defined goals or they might have like, oh, I have resolution of I’m going to try to get healthier. Okay, what does that mean? So they’re saying that 83 out of 100 people don’t have any clearly defined goals. Only 17 do. But of the 17 who have clearly identified goals, 3 out of 100 wrote them down.
Bob:
Okay. What about this? This is interesting from this same study that Harvard did, and this is an old study done many years ago that 3 out of the 100 people that had written their goals down were earning 10 times the income of the 83 people that didn’t have any written goals at all. Now we talk about we’re a financial show. Right? Wow. So 10 times.
Shawn:
Wow.
Bob:
That’s a lot more, isn’t it? And they also tended to be in better health and had happier marriages. I think writing them down is extremely important. Now I just got to say this, the number one reason for financial failure is procrastination. But goals, like I mentioned in the beginning, they’re like a target. If you don’t even have the target, how do you expect to hit anything?
Shawn:
How do you know when you even hit anything?
Bob:
So this is an old Methodist from the old school. It’s been around a long time and they call this the SMAC method. SMAC.
Shawn:
You can SMAC your goals, but you can’t SMAC your friends. Just remember that. Kind of like you can pick your nose and you can pick your friends, but you can’t pick your friend’s nose. Kind of the same thing. So SMAC.
Bob:
Man, you making me turn all red at that. That’s a really good one, Shawn.
Shawn:
Well I’ll jump in on the first one then. So SMAC goal setting the S in SMAC means specific.
Bob:
I’m glad you said that one because I never can say that word right.
Shawn:
Well there’s a lot of consonants in there. So specific – setting your goals and a target specifically for you, not the goals someone else has or wants. Remember specific, not Pacific, like the ocean.
Bob:
Yeah, that’s where I get mixed up. Yeah, my wife says you can’t say that word, can you? I’ll say specific.
Shawn:
That’s fine. That’s all right. I’ll let you do the other one.
Bob:
Okay. Yeah, I can say this one. The M in SMAC is measurable. So set the goals that you can measure, actually measure along the way. That’s where losing weight, you can get on the scales every two or three days. I wouldn’t suggest every day because it’s going to fluctuate too much, but every three or four days and you can measure that.
Shawn:
And then A in SMAC stands for achievable. So set goals that are achievable. And the final one, Bob, you want to do the final one?
Bob:
The C, compatible with your values and beliefs.
Shawn:
So I think a simple example for people, if you say your goal is to get in better shape, well round is a shape. So what exactly do you mean by getting in better shape or getting in shape? So a SMAC goal might be, okay, I want something specific such as I want to lose 5% body fat. Whatever you’re at. Maybe you’re at 20%, you want to go down to 15%. Okay, so that’s specific. I almost said it wrong, but then the measurable part. Okay, well measurable. Well, there’s a lot of scales. There’s a lot of things you can do to pretty easily measure that on a regular basis. So the achievable part, okay, losing 5% body fat, I mean that’s fairly achievable as long as you don’t say in the next month. Well, no, that’s not achievable. And then the final one, compatible. Okay, well do you have any issues with that? I mean, I don’t really see any issues with that being incompatible with your values and beliefs, but you want to make sure it is compatible with that.
Bob:
Another example, and I remember I’ve used this one in the past is if I said I want to get in better shape, but I want to run a marathon with my torn meniscus on each knee, that’s not going to happen, Shawn. So for me to say I want to run a marathon is not compatible, but for me to say I can walk three to five miles a day, that’s compatible. I can do that with the right kind of tennis shoes. Okay.
Shawn:
Alright. Let’s get into specific. By being very specific with goals over the years and putting them in writing, Bob has reached nearly 100% of them over time.
Bob:
I have. It is amazing to go back, I’ve been doing this system now for a good at least 15, 17 years. I just found when I was going through on our word processor, 2008 goals that I’d written down. So I know I can go back right there. What is that, 16 years?
Shawn:
I forgot to bring mine. But when we did our program last time for 2023 of the six categories, I believe I hit it was four of the six. Yeah. I mean I made progress with the other two, but it is nice to be able to look back and see, okay, yeah, I actually made progress on these.
Bob:
This little goal chart that I have, and you can just do this on any word program, Google docs, whatever I write down for the SMAC method behind each one of these. Spiritually, physically, financially, mentally, relational, professional, and charitable. And so these are the seven that I’ve come up with over time. I remember it used to just be like four, but now it’s seven. All that, you can have different goals of the spiritual part. It could be you want to read the Bible this year or you want to get involved in a Bible study or teach a Bible study. Physically, we’ve talked about that. Financially, we’ve talked a lot about that. Professionally, like CFP I know you’re trying to become. Okay, alright. So there’s just so many areas. I know we’ve gone over a lot today and we’re getting near the end of our time for the day. But those financial goals could be paying off debt. The key is make it…
Shawn:
SMAC.
Bob:
Make it SMAC and make it…
Shawn:
The key is make it SMAC to you. Specific, Measurable, Achievable, and Compatible.
Bob:
Exactly. With this today, I hope this has been very informative to you. I will take this and I’ll laminate it and put it one in my shower, one in my car, one at my desk. I have several desks, by the way. I’ve got one up here at the office. I’ve got my office at home. I’ve got one in Rockport, Texas. So I just put these things all over the place where it reminds me on a daily basis. And you’ll notice when it’s reminding you to remember writing them down, that’s the important thing. You can’t just say it, you got to write it down and you got to see it with your eyes every day.
Shawn:
And I think the other thing that it forces you to do is when you have a smaller paper like this, with each of those six to seven categories, it forces you to be more intentional, which does also cover the specific part of it as opposed to, I have this huge list of goals I’m trying to accomplish. Like, well, you know what? Pick for the year. Pick one thing for spiritual, pick one thing for physical, pick one thing for financial, and just kind of go through that. And then it’s, okay, here’s the one thing in each of those categories that I’m trying to better myself and meet those goals for this year.
Bob:
Hope that helps you. Don’t delay, don’t procrastinate on this. Do it tonight, tomorrow, in the next day or two. Or this weekend that’s coming up.
Shawn:
Yeah.
Bob:
Alright, that’s all for now.
Shawn:
Thank you. And as always, God bless.
[CONCLUSION]
That’s all for now.
We invite you to listen to all of our past episodes covering many financial topics from a Christian Perspective. To make sure you don’t miss any of Bob’s upcoming episodes you can subscribe to Christian Financial Perspectives on iTunes, Google Play Music, Spotify, or Stitcher. To learn more about integrating your faith with your finances, visit ciswealth.com or call 830-609-6986.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 188 – The Ultimate 2023 Financial RecapThe Ultimate 2023 Financial RecapA 2023 financial recap to help look forward to what 2024 might hold.
More episodes >>
What financial topics first come to mind when recalling 2023? Is it the emotional rollercoaster of 2023’s stock market or the endless printing of money? Bob and Shawn want to provide perspective on key events that impacted many financial portfolios. Before looking ahead, they are recapping the past year’s twists and turns.
This includes the markets’ obsession with interest rates, as well as the volatility caused by concerns about the Federal Reserve’s actions. Looking ahead to 2024, it is important to remember the ups and downs of 2023 in order to make more informed financial decisions for the future.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersWant to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTShawn:
Recalling the emotional rollercoaster of 2023’s stock market? Want perspective on key events that impacted your portfolio? Before looking ahead, we’re recapping the past year’s twists and turns. Let’s get some perspective.
Welcome to another episode of Christian Financial Perspectives. We’re so glad that you’ve joined us. My name is Shawn Peters for those who haven’t joined us before, and I’m joined by my co-host and Father-in-Law, Bob Barber. Today we are bringing you our 2023 financial recap, and this is released right after Christmas, but we did – because of the magic of Hollywood recording or whatever you want to call it, we believe it or not, did have to record this a little before we published it. So if anything has come out since right before Christmas or after that we don’t have on here, we apologize. Maybe we can try to put something in the description, but yeah, what a year. I mean, we have grown a lot, I feel like Bob, as a show.
Bob:
We have.
Shawn:
For those who don’t know.
Bob:
Had 180 episodes now. Yeah, we started off as a podcast the first three years.
Shawn:
This should be episode 188.
Bob:
Is that what it is?
Shawn:
Yep. So we’ll hit our 200, 201 come 2024.
Bob:
Exciting.
Shawn:
Just a quick shout out for those who don’t know, my wife took over editing, not sure how many episodes exactly back, but Bob’s oldest daughter, and thank you, Jenna. I think she’s done an awesome job. Hopefully you guys have appreciated some of the graphics and transitions, and it’s made a difference.
Bob:
She makes you and I sound good. I know that.
Shawn:
Which is a task.
Bob:
If we stumble by the way, she takes a stumbling out.
Shawn:
Exactly. Well, as much as she can. Yeah.
Bob:
Alright, so let’s get to the financial recap. Thank you very much, Jenna, for the incredible job that you do. Of course, you’re extremely smart and you go beyond anything that your dad has ever done, I think so. It was quite a year, Shawn, as we look back and do a financial recap of 2023, we had a market totally consumed with interest rates. I mean, you couldn’t turn on the financial news daily without nearly every interview.
Shawn:
Something related to interest…
Bob:
Something to do with interest rates and how they were going to be affected by consumer news. And then we ended up having a very narrow stock market that we’re going to go into a little bit here for much of the year just based on what they call the “Magnificent Seven”.
Shawn:
I like how you said that, Bob, for anyone watching that may not have seen one of these, but we do a monthly bullet point. It’s meant to be a two to three minute little recap of what was going on. And Bob called the S&P 500 the S&P 7, because that’s basically the tail wagging the dog is those seven companies.
Bob:
That’s what it was for the first 10 months, but it’s now spreading out. And then we had some of those bank failures earlier in the year, so let’s get to it. The market consumed with interest rates. You could not turn on the daily news without the concerns about the Federal Reserve and what they were going to do based on employment, unemployment, data, inflation, retail sales, and it just caused extreme volatility throughout the year.
Shawn:
That’s right. That’s right. And the Fed increased interest rates by a 0.25% increments in February, March, May, and July,
Bob:
And that was the last one in July. They’re not going to have any more interest rate increases – by the latest news that we have. The 10 year treasury bond was a really big newsmaker and the 10 year treasury bond, the reason that’s so important is that’s based a lot on how mortgage rates play into the equation. And in July it was a little bit under 4%, but then it rose to nearly 5%. It actually touched 5%.
Shawn:
It kind of kept touching…it was flirting with 5%.
Bob:
For one day, it went over 5% for just 10 minutes. We speak to you right now…
Shawn:
And that was the peak, like mid October.
Bob:
Yeah. And as we speak to you today, as of December 14th, 15th, the 10 year bond has gone back below 4%. I mean, this is just really fresh news as we bring the podcast to you today. So, it’s really been interesting to watch these rates pop around. You could see as the 10 year bond rate went up, the markets went down, vice versa. So it’s ended up being this yearend rally, and I was predicting this yearend rally. Our clients kept calling us, I said we’re going to have a yearend rally. I see it. It’s written all over the, it’s just in the handwriting, nearly.
Shawn:
Just a lot of factors.
Bob:
But it has been, you’ve been whipsawing around a lot this year and it just proves you’ve had to have a long-term perspective and not let your emotions get involved investing. Okay.
Shawn:
That’s right. As Bob mentioned earlier, it was also a very extremely narrow market for stock returns for the first 10 months of the year.
Bob:
And that was based on basically the seven companies, which these are woke companies, so we don’t invest in ’em. They’re not biblically responsible, but it was Apple and Google, Microsoft, Meta – which is Facebook, Tesla, and Nvidia, not the other 493 companies of the S&P 500. It’s like these seven just went off and left the other 493 in the dust. But the way that it’s reported in the news, it’s reported always is the cap weighted, not the equally weight, S&P 500. So if you were to look at the equally weighted S&P 500, which is a better way of looking at the Fortune 500, you’ll see the difference in how they just pulled apart. And a lot of that had to do with AI coming out, artificial intelligence, made a huge splash.
Shawn:
Even though there’s been a lot going on in that space, it seems like 2023 was kind of the year of AI with just so many different areas that it was affecting. And of course there’s also a lot of speculation on, oh, it’s going to do this or that, and there are many things I’ve heard. I’m not going to go into any details, but there’s some stuff that you see it come across and okay, realistically that’s probably more like a 10 year thing, but people are acting as if it’s happening in 2024.
Bob:
There was so much emphasis put on Nvidia because Nvidia came out with some very good news, and Nvidia went up to over 240% at one point.
Shawn:
And if I remember correctly about that, it was partially to do with the way, for those who haven’t looked into it as much, but believe it or not, AI does require a lot of computing power, but it’s a little bit different in the way that it works. And so Nvidia, a big part of their increase had to do with them getting involved and starting to be used more, I think, on the GPU side of things for the AI. Yeah, that was interesting to see this company going up this much kind of reminds you of the 1999 internet bubble.
Bob:
Yes, A little bit. So fast, so quick. The PE ratios just got way out of whack – way, way, far away from the overall average PE of the market. And will it be able to catch it thinking that these are really the only guys in town and now the news is coming out more and more that it’s not. I just heard another company, a big, big company, I’m not going to mention the name, because that’d be like saying a stock tip, but this morning how all their computers are going to be built with the AI chips, and they’re not getting them from Nvidia.
Shawn:
Which dropped Nvidia down about 20% from their earlier highs. As of when we’re recording.
Bob:
And it is not just that news, but it has just gotten a little, as I say, frothy. So the last several months of the year, it’s been interesting to watch the market returns finally spreading out to the other 493 companies. Okay.
Shawn:
Yeah, exactly.
Bob:
But in the beginning of the year also, we had these large bank failures we had back in the spring, and this caused widespread fear that other banks are going to collapse. We saw the entire banking sector just being sold off, ridiculously dropping by 28% and 30% in value, creating some really good buys, by the way. And it was basically, the two large banks were the Silicon Valley Bank. We heard that in the news back then as Signature Bank, and they were the third and fourth largest bank failures in the United States since 2001 in total assets lost. So that was a big deal, but we seem to have gotten past that now and I’m glad that we have.
Shawn:
Well, because remember, the banking system works as long as we all think it works. Which, I mean, it kind of is about that simple.
Bob:
Yeah, that’s right. So the last part of, as we recap 2024, there seemed to be a constant fear of recession and it wasn’t, I mean, not 2023, I mean going into 2024. For 2023, there was a constant fear of recession. By the way, this has been going on now for about 18 months. It’s just recession, recession, recession is going to happen, and it never did. The unemployment rate never went above 4% for the whole year of 2023.
Shawn:
Which is phenomenal.
Bob:
And the CPI inflation, consumer price index, it started off at 6% at the beginning of the year, and now it’s half that.
Shawn:
Yep. 3.1.
Bob:
Yeah. So that’s right at half that. We were pointing this out the other day. We saw GDP numbers come out, which were double what they were a year earlier.
Shawn:
It came in at 5.2% compared to 2.7% a year earlier, which is phenomenal. I mean, anytime our GDP is 5% or higher, that’s a good rate. And what was the analysts originally? I think they thought it was going to be 4.9, I think, or 4.8, and then the initial results came out at 5.0, but then when they finalized the results, it came out at 5.2. So I mean it’s been good.
Bob:
So the economy has been operating on all eight cylinders if it was an eight cylinder car.
Shawn:
Yeah, I think it was the third quarter earnings came out and for the S&P 500 companies, over 80% of the companies beat the estimates.
Bob:
Beat the estimates. They sure did. That’s right. The supply of goods was nice, too. This last year it seemed like the supply caught up with the demand. And when I drive by the car dealerships now I see so many cars where I remember at the beginning of ’23 and at the end of ’22, the lots, they were empty. But now there is plenty of supply, even maybe a little bit too much supply, which is helping to pull down inflation. That’s a recap of 2023. Looking ahead in 2024, first of all, it’s a presidential election year. Need we say more? The party in power usually wants to do everything that it can that’s possible to make that economy look really good so they can get back in power in the election.
Shawn:
Which I know they’re going to do that. I’m just hoping that maybe we won’t get as much printing money and passing out stimulus checks and all these other things, make people feel good because…
Bob:
Don’t buy the votes. Please don’t buy the votes. Come on.
Shawn:
They do that. And don’t be fooled by that. They send out these checks and you think, oh, sweet, I got an extra thousand bucks or 600 bucks a person or whatever it is.
Bob:
It’s crazy inflation.
Shawn:
But it’s just going to make it worse. Three, four months later, now inflation’s worse.
Bob:
Yeah, right.
Shawn:
It’s the worst thing they could do. Anyway.
Bob:
I’m worried a little bit that the Federal Reserve just said yesterday as we make the program again, that maybe we’re going to lower rates three times next year. Hopefully that’s not going to be a political thing and it’s going to turn that way, but because that could be a concern. The markets love it when interest rates go down, and so if they start lowering those rates, but they need to be careful because they over tightened and now they need to be careful of loosening up too much.
Shawn:
Well, I mean, if anything, Bob, they should have just said, we’re not planning on making any rate changes next year. Just leave it alone for a while. Yeah, because it’s like they keep acting like they’re driving a speedboat instead of a huge tanker.
Bob:
Well, that’s one of the things that’s pushed the market up so quick though, too.
Shawn:
Just the announcement that they’re going to drop rates.
Bob:
Because they’re thinking it’s going to happen around March or April is what the market’s thinking, and maybe another one by the summertime. You know what? We’ll just wait and to see, bottom line. I think returns in 2024 are going to continue to spread out, also, just from the Magnificent Seven as we called it, or the S&P 7, that’s what the CNBC and they called it the Magnificent Seven, but everybody’s talking about that now because so much money went just into that piece of the market, it needs to spread back out. And that’s what’s happening right now.
Shawn:
Which is good. That’s better in the long run.
Bob:
And I think we’re going to see short-term CD rates for banks that’s going to be going down this next year. Of course, when rates go down, boy, it was nice while it lasted. It lasted about a year, year and a half above 5.0%, 5.5%. I looked this morning. You can still get a 5.5% rate. If you can get it, go for it.
Shawn:
Because if you can find one for a 12 month…
Bob:
Take it!
Shawn:
Take it. It’s not going to be around very long.
Bob:
If you can find one for a 24 month, definitely take it. I saw some three year CDs this morning, like 4.9%, I may even take that. So close to 5%. So there you go. That’s a lot of information. I hope that was a good recap for you. We hope you have a very happy New Year. We’re looking forward to the year coming up. Anything else?
Shawn:
As always, thanks for joining us and if you have any specific topics you’d love to see us cover or possibly discuss on an episode, pop that in the comments, or you can visit our website, www.ChristianFinancialAdvisors.com, or you can call or text us, (830) 609-6986.
Bob:
We got some great topics coming up in the next two to three weeks, so stay tuned because we’ve already made some of those programs and they’re very good for the time period.
Shawn:
We’re always open to suggestions.
Bob:
Yes, absolutely.
Shawn:
So thank you as always, and God bless.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 187 – The True Joy Of ChristmasThe True Joy Of ChristmasDiscover the true joy of Christmas through the birth of Jesus and a story about a giving family.
More episodes >>
This inspiring Christmas episode is all about reminding listeners of the joy of the season! Bob and Shawn share the original Christmas story of the birth of Jesus as told by Luke, as well as telling an inspiring story about a family who anonymously blessed another family in need.
This Christmas season, we encourage listeners to find ways to help those in need during the Christmas season, whether through financial donations or volunteering time. Use your time and resources to help bless others and in return, you’ll receive immeasurable joy!
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodeLUKE 2:1-20In those days Caesar Augustus issued a decree that a census should be taken of the entire Roman world. (This was the first census that took place while Quirinius was governor of Syria.) And everyone went to their own town to register.
So Joseph also went up from the town of Nazareth in Galilee to Judea, to Bethlehem the town of David, because he belonged to the house and line of David. He went there to register with Mary, who was pledged to be married to him and was expecting a child.
While they were there, the time came for the baby to be born, and she gave birth to her firstborn, a son. She wrapped him in cloths and placed him in a manger, because there was no guest room available for them.
And there were shepherds living out in the fields nearby, keeping watch over their flocks at night. An angel of the Lord appeared to them, and the glory of the Lord shone around them, and they were terrified.
But the angel said to them, “Do not be afraid. I bring you good news that will cause great joy for all the people. Today in the town of David a Savior has been born to you; he is the Messiah, the Lord. This will be a sign to you: You will find a baby wrapped in cloths and lying in a manger.”
Suddenly a great company of the heavenly host appeared with the angel, praising God and saying, “Glory to God in the highest heaven, and on earth peace to those on whom his favor rests.”
When the angels had left them and gone into heaven, the shepherds said to one another, “Let’s go to Bethlehem and see this thing that has happened, which the Lord has told us about.”
So they hurried off and found Mary and Joseph, and the baby, who was lying in the manger. When they had seen him, they spread the word concerning what had been told them about this child, and all who heard it were amazed at what the shepherds said to them.
But Mary treasured up all these things and pondered them in her heart. The shepherds returned, glorifying and praising God for all the things they had heard and seen, which were just as they had been told.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTShawn:
Today we’re sharing an inspiring story about a family who anonymously blessed another family in need. We hope you enjoy it as much as we did. Let’s get some perspective. Welcome back to another episode of Christian Financial Perspectives. My name’s Shawn Peters. I’m joined as always by my co-host Bob Barber, and today we’re bringing you our Christmas episode as we’re about one week from Christmas at the time that this should be published. Today we’re going to be covering the Christmas story. We’re going to be covering some Christmas traditions, and we’re going to be sharing with you a story about a family helping another family in need. Bob, would you like to say anything to get us started?
Bob:
I am ready, Shawn. I’ve worked on this quite a bit and I think it’s going to be a very inspirational, especially this Christmas story that you’re going to hear and it just warmed my heart when I found this online. It totally warmed my heart to think, okay, this is something I can do and any of us can do. So please stay tuned today. You’re going to be blessed by today’s episode. But yeah, first we’re going to get into the Christmas story. I think it’s always good to go to God’s word.
Shawn:
We’re going to get started with Luke 2:1-20, “In those days, Caesar Augustus issued a decree that a census should be taken of the entire Roman world. This was the first census that took place while Corinius was governor of Syria.” Thanks for letting me read this part, Bob.
Bob:
That’s why I’ll let you read it, Shawn.
Shawn:
“And everyone went to their own town to register. So Joseph also went up from the town of Nazareth in Galilee to Judea, to Bethlehem, the town of David, because he belonged to the house and line of David. He went there to register with Mary, who was pledged to be married to him and was expecting a child. While they were there, the time came for the baby to be born and she gave birth to her firstborn, a son. She wrapped him in cloth and placed him in a manger because there was no guest room available for them, and there were shepherds living out on the fields nearby, keeping watch over their flocks at night. An angel of the Lord appeared to them and the glory of the Lord shown around them and they were terrified. But the angel said to them, ‘Do not be afraid. I bring you good news that will cause great joy for all the people today in the town of David, a Savior has been born to you. He is the Messiah, the Lord. This will be assigned to you. You will find a baby wrapped in cloth and lying in a manger.'”
Bob:
“Suddenly, a great company of the heavenly hosts appeared with the angel praising God and saying, ‘Glory to God in the highest heaven, and on earth peace to those on whom his favor rests.’ When the angels had left them and gone into heaven, the shepherd said to one another, ‘Let’s go to Bethlehem and see this thing that has happened, which the Lord has told us about.’ So they hurried off and found Mary and Joseph and the baby who was lying in the manger. When they had seen him, they spread the word concerning what had been told about this child and all who had heard it were amazed at what the shepherds said to them. But Mary treasured up these things and pondered them in her heart. The shepherds returned, glorifying and praising God for all the things they had heard and seen, which were just as they’d been told.” There is the Christmas story wrapped up all for you.
Shawn:
Alright, well that about does it for us. So y’all have a wonderful rest of the day.
Bob:
Shawn. So some Christmas traditions I thought would be interesting. You know how Texan I am? I don’t know if you know it, but those who listen, my family goes back in Texas over 190 years. Way, way back.
Shawn:
You look good for 190.
Bob:
Yeah, I do, don’t I. I’m starting to get a lot of gray and losing some hair, too. My great great grandfather, my third great grandfather was the founder of Travis County, which is Austin, Texas. So back then, that was the farthest west that the pioneers had gone. And around Christmas time, of course, they all lived miles apart. So on Christmas time, they would go out on their front porches to wish each other Merry Christmas. Well, they couldn’t yell it. They were too far away. So guess what they did? They took a shotgun and blast three times, boom, boom, boom. You could hear the shotgun blast going off in the distance all over and around. And that’s how they would say Merry Christmas to each other. Actually, this story is in Texas monthly and Austin Statesman. This is an old famous story.
Shawn:
The Hornsby story.
Bob:
The Hornsby story that was on my mom’s side. Other family traditions that we have here in Texas, by the way, I know a lot of you are not in Texas that watch us, is that we always have tamales, chili, and beans on Christmas Eve with pecan pie for dessert, and it’s followed by lots of heartburn that night.
Shawn:
Heartburn is optional, though.
Bob:
Yeah, well it usually comes with it, though.
Shawn:
Depending on your age and whether or not you were medicated before you started eating.
Bob:
That’s a tradition, especially in South Texas and everybody eats those tamales. So I thought this would be a great, this is a great story of a prosperous family. We’re going to call it the prosperous family and the family in need. But I think you’ll be blessed by this story. Alright.
Shawn:
Alright, here we go. What a year we, this prosperous family, had – a new baby daughter, a job promotion, and a brand new home were among the many blessings they had received and they were grateful. They wanted only a few gifts for Christmas because their cups were running over, but they knew their children still anticipated Christmas morning and gifts from Santa. So one evening this prosperous family talked about doing something special for another family in need at Christmas. Their oldest son said, “Why don’t we find a family who needs help and give them presents?” Soon, the prosperous family was excited about the idea, so they decided to do their project anonymously. They didn’t know exactly how they would find a needy “Christmas family”, but they wanted to help. The next morning, the dad made calls to friends who might know of a family in need. That evening at dinner, dad described the family in need he had found.
Bob:
The father of the family in need was a carpenter and out of work. They had three children, one the same age as the prosperous family’s new baby. But their baby had been undergoing many tests as doctors tried to determine why she wasn’t developing properly. Because the family in need had no insurance for all the medical costs, their savings were completely depleted with nothing to spend for Christmas. The next morning while the prosperous family was talking about the family in need, the daughter asked if they could give the family in need some of their clothes. They all agreed that her idea was good. So the children of the prosperous family ran to their bedrooms and began sorting out the clothes they had outgrown. But dad just knew that clothes were not enough.
Shawn:
The following day, Prosperous Dad asked the children if they would like to buy a special present for each member of the Christmas family. Excitement rained as they departed for an evening of holiday shopping. The following week, the prosperous family was ready to deliver gifts, clothing, and oranges to their Christmas family in need. But before they left, Prosperous Dad gathered the children and said, “It sure is great to see all of you so excited to share your Christmas. Do you realize that by buying these gifts and this food you are giving up part of your own Christmas?” The prosperous children had not thought of their project that way before. Their eyes widen as Prosperous Dad took out a crisp, hundred dollar bill.
Bob:
“Do you think we should give this money to the family in need so that they can buy other things they need?” Prosperous Dad asked. “And do you understand that your Christmas will be very small this year because we’re sharing it with a family in need?” Each of the prosperous children grinned and nodded and they tucked the money into a Christmas card and addressed the envelope to “our friends”. They were off to deliver Christmas to their special family.
Shawn:
They parked the car up the street from the family in need and planned their delivery strategy. Within seconds, it was all accomplished. They pulled the car away just as the door opened. That evening, as the prosperous family prayed, their minds and hearts were truly one. Christmas was still a week away, but they felt they had just had theirs. The next morning the phone rang from a friend of Prosperous Dad, “Just thought you’d like to know about a family that received a special gift last night,” His friend said. “They had been wondering if they should use their last $20 to tithe to the local church or if they should keep it because Christmas was nearing and they had no more money. They decided to pay their tithe. Last night, their doorbell rang and when the husband opened the door, he found packages of clothes, gifts, and food. The next morning they noticed a white envelope on the floor and when they opened it, a $100 bill fell out. They know it was the Lord’s way of blessing them for being obedient and their hearts are full of gratitude.
Bob:
Wow, that’s it. What a story. Isn’t that a beautiful story? And it’s a great story for all of us that have been prosperous this year to look for someone in need. There are many, many people in need in our country, in your own town. So I would encourage you to take this story and make something of it and let’s all make a difference this Christmas. One of the things that we did just a few weeks ago is we talked about some unique giving ideas. So if this is not something you can do, there’s also many unique giving ideas like opening a donor advised fund this year and funding that. But go back to episode 184 that we made at the end of November, and that will give you many ideas that you can come up with.
Shawn:
That’s right. If maybe you don’t see yourself as prosperous or having as much to give as this family from the story, you can always give time and effort. I know every year our church for Thanksgiving and Christmas looks for ways that we can give food and meet the needs of people in the community. So talk to your church. Ask around. I’m sure there are places that maybe need extra volunteers, need people to help deliver. It doesn’t have to be money if you don’t necessarily have a lot of money, but we all have time that we can give.
Bob:
And Shawn, I wanted to do one last thing this time, too. It’s a little bit different for us. Okay? First, we want to wish all of our listeners a Merry Christmas next week and hope it’s filled with the love of our Lord and Savior Jesus Christ. But I also want to say that there may be some of you that are listening that don’t know Jesus as your personal Lord and Savior, and we want you to know that he is there for you. And all you got to do is reach up to him and say, Lord, I’ve made a mess of my own life. I’d like to make you my personal Lord and Savior, and we would love to be there with you. If you would like somebody to pray with you, please give us a call or text us and we’ll be glad to reach out. But there’s so much with the walk with the Lord, and I just can’t imagine not being a Christian myself.
Shawn:
Well, we’re here, whether it’s financial or spiritual, give us a call.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 186 – Do These 7 Things Before Buying Your Next VehicleDo These 7 Things Before Buying Your Next VehicleFollowing these 7 tips before purchasing your next vehicle could save you thousands!
More episodes >>
Are you thinking about buying a car? Bob and Shawn discuss 7 smart steps to take before you make your decision. This episode is here to help you learn how to make the right vehicle choice with confidence.
It’s crucial to approach the car purchase with the right mindset, not emotions. A vehicle’s price is more than the minimum monthly payment, and it is important to be cautious of all of the add ons and price points that many salespeople will use to manipulate you into a premature purchase. These tips, along with several others, may just help you save thousands on your next car purchase!
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodeJAMES 1:5If any of you lacks wisdom, you should ask God, who gives generously to all without finding fault, and it will be given to you.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTShawn:
Thinking about buying a car? Here are seven smart steps to take before you decide. Learn how to make the right choice with confidence. Let’s get some perspective.
Welcome to another episode of Christian Financial Perspectives. My name’s Shawn Peters. I’m joined as always by my co-host, Bob Barber, and today we’re going to be talking about the seven things to consider before buying your next vehicle. And so we feel that this will be a really helpful one to cover whether you’ve got a little bit of money or a lot of money or somewhere in between. First and foremost, we’re going to go over our scripture, James 1:5, “If any of you lacks wisdom, you should ask God who gives generously to all without finding fault and will be given to you.” Now, we do have one thing to cover before we get into the official seven things, but we’re kind of bringing this episode to you because this is, I would say, very close to Bob’s heart because these are things that he does. And Bob, I’d say you’re probably one of the few people that kind of enjoy almost the game of buying a car.
Bob:
It’s unfortunate, but I kind of do.
Shawn:
Where most of us get stressed out and frustrated with the whole process. So, the idea here is we’re going to hopefully try to glean from Bob’s experience.
Bob:
I played Monopoly when I was a kid.
Shawn:
And you actually loved it.
Bob:
I loved it. I mean, I’m talking like seven and eight years old. I was playing Monopoly.
Shawn:
That explains so much.
Bob:
That’s it. I mean it’s kind of like that. So I know it’s a process and it can be so stressful, but Shawn cars are so expensive today. Vehicles.
Shawn:
Crazy expensive.
Bob:
Yes. We’ve had several clients recently buy trucks and I’m like, $50-60,000 and these are not the loaded trucks.
Shawn:
If you’re lucky, for a truck.
Bob:
Oh my goodness.
Shawn:
I mean, Bob, we live in a world now where you can buy a Kia that’s $60,000 and that’s the normal price.
Bob:
Yeah.
Shawn:
If you told me that 10 years ago, I would’ve said you’re crazy. But it’s true.
Bob:
Anyway, the first thing, I mean, we’re going to have seven things that we’re going to talk about when buying a car. This is not the first one, but it kind of is the most important thing that I see.
Shawn:
And it’s coming to this with the right mindset, I guess, is how you want to consider.
Bob:
That’s right. So use your savings to buy a car, not your investments. A car is a depreciating asset, Shawn.
Shawn:
And for those who aren’t up to date on their financial terms, depreciating meaning it goes down in overall value over time.
Bob:
Yeah. Cars go down, and investments go up over time. Don’t take something that’s growing and appreciating to put it into something that is depreciating.
Shawn:
And losing value over time.
Bob:
An example of this, let’s take the $50,000 car.
Shawn:
Which is probably average, I would say, nowadays.
Bob:
You’ve got your long-term investment plan, let’s say a balanced or a moderate portfolio making 6% or 7% a year. And so through the rule of 72’s compound interests, we’ve shared that on some other programs. Now, if you take that 50k out of the investment plan, it’s not going to double to 100k in like 10 years, and it’s not going to double to 200k in like 20 years. So I always think of it this way.
Shawn:
So over 20 years, the $50,000 could fairly easily grow to $200,000 in value.
Bob:
Based on historical results. That’s right.
Shawn:
So if you take that $50,000 out of your investment portfolio to buy a car, how much is the car going to be worth in 20 years?
Bob:
I’m guessing $10,000 or 15,000 at the most.
Shawn:
Yeah. Seems about right.
Bob:
Would anybody want to be in an investment plan where you’re guaranteed to lose every single year? I mean, no. Not at all. But people do that with vehicles and it is just amazing how much money is wasted on vehicles. So today what we’re going to do is we’re going to go over the seven things to do before you buy your next vehicle, and hopefully this will at least help you some in saving $5,000 or $10,000 when you’re buying that next vehicle.
Shawn:
I think what we just covered, Bob, kind of brings up a side point if you will, but if your only real option after we cover all these things, if your only real option to buy a car is to take money out of your investment portfolio, then don’t buy the car in the first place. Or, you need to significantly lower your expectations of the kind of car that you want. You don’t need the new $50,000 car. Maybe you need to get a used, not as nice, car because I understand, we understand you have to have a vehicle nowadays.
Bob:
You do.
Shawn:
Especially if you have a growing family. But that does not mean you need to spend anywhere near $50,000 on a car.
Bob:
No, you could buy a 3 or 4-year-old car that maybe has 50,000 miles on it, has another 150k to go – 150,000 miles to go. Now I understand some of you don’t have the savings either, so if you are going to, you’re just absolutely going to buy one, go talk to your credit union about the best interest rate deal you can get. I wouldn’t use the dealership. They may have higher rates. Okay.
Shawn:
Alright. So now on the main event, now the seven things before buying that next vehicle, number one, select the vehicle you want first and foremost by test driving a few at a dealership. But here’s the kicker. Whatever you do, please do not buy for at least another three to four weeks, it will save you thousands of dollars.
Bob:
It will. I’ve seen it over and over. Do not let those emotions get involved. Get away from that dealership. Just find the car you want first because there’s going to be a what?
Shawn:
Why should they wait three to four weeks and not buy that first day of the dealership? Well, it’s because the dealers…Are not going to give you the best price on that first day. You want them to sweat a little bit and try to move that unit, move that product off of their lot. So you give ’em a few more weeks, you don’t look desperate. So you’re negotiating from a position of power.
Bob:
That’s right. They just keep lowering and lowering and lowering the price.
Shawn:
They want to get you in. Yep. So number two, after finding the exact make model, color and year that you’re wanting to buy, search multiple websites. You want to get a good idea of what that car is actually worth, what it’s going for in the market right now. So cars.com, Autotrader, Edmonds, I mean there’s a lot of them.
Bob:
And they’ll give you a mile radius, do it within about a 500 mile radius, not just your local area. A car again is a $50,000 investments investment. It’s not really an investment. What would you call a car?
Shawn:
It’s a necessary expense.
Bob:
It’s a necessary expense.
Shawn:
It’s not an asset, it’s not an investment.
Bob:
So if you got to drive seven or eight hours to go get that car to save yourself $5,000 or $6,000, it’s worth it. Definitely. Or just have it shipped.
Shawn:
Yeah. Sometimes it might even be worth it because if you can save $6,000 might be a thousand dollars to ship it. Well, great.
Bob:
You’re going to be surprised in the variation in dollar amounts on one of these websites like cars.com or edmonds.com or Autotrader.
Shawn:
One kind of sub bullet point on this though is when you’re searching, if you’re looking at a car and you’re seeing that make model color, everything but similar mileage and the car is, let’s say the car is around $40,000 to $50,000 pretty much across the board, if all of a sudden you see a listing for $30,000,
Bob:
That car’s been damaged.
Shawn:
Yeah, probably. It’s one of those things where they’re not being upfront about it and there was something going on and I actually learned that, thankfully not the hard way, but I learned that because I kept seeing for some of these used cars that Jenna and I were looking at like, man, why are some of these options so much better and the car seems to be in really good shape? And then you find out, oh, it’s because they sell a lot of those almost like refurbished because it was in a water damage or it was in an accident, it was totaled. There’s all kinds of stuff.
Bob:
It’s the old saying, “If it sounds so good to be true, it is.” So this third point, this is really something, I’ve done this a lot. Okay?
Shawn:
If it’s a new vehicle, if it’s a new vehicle.
Bob:
If it’s a new vehicle. So if it’s a new vehicle and you found exactly what you want, I have a Nissan Pathfinder.
Shawn:
Whatever it is, go to the manufacturer’s website.
Bob:
Go to the manufacturer website
Shawn:
And find up to 10 dealerships within say 200 to 500 mile radius where you live. Then you’re going to take those dealers and you’re going to contact each one, preferably by email because you want to hear everything in writing, but you can initially talk to ’em over the phone and tell ’em precisely what you want. Now here’s the kicker on this. You want to get the drive out price in writing via email. Do not even tell them whether or not you’re considering a trade-in. Just say that’s not relevant for the discussion right now. You’re just looking for the best price. You may or may not trade in. That’s all they need to know. So once you get that price, take the lowest price and let all the other dealerships know it. Do this two or three times and you know you’ve found more or less the lowest price when they’re only coming back and dropping maybe a hundred dollars. At that point, go to the closest dealer, the local dealer, see if they’ll match it. Sometimes they will. Other times they’ll say, nah, we can’t match that, which is fine. Then in which case, go to another one.
Bob:
I’ve done this over and over, Shawn, and I mean from the time I begin to the time I’m done doing this, there’s about a $5,000 difference. I am amazed and we’re talking y’all just a couple weeks. So this is why it’s so important to follow this process to not buy that car that first day. You are literally throwing $,4000 or $5,000… you’re just throwing it away, right? Okay, alright.
Shawn:
Number four, get educated. All along the way during this process you want to get educated. So obviously this video is intended to try to help you with that, but there are also some other really awesome channels that are more dedicated.
Bob:
By the way, when we were starting this video, it’s one of these as I watched, I said, they do such a great job. They’re a father son team.
Shawn:
Father in law, son in law. Close enough.
Bob:
But YAA. Go on YouTube and put in “YAA car buying” and they’re really fun to watch, too. They have about 10 or 15 minute videos and they go through all of the things you need to be thinking about.
Shawn:
Tricks and techniques that car dealerships will use. They’ve even done some almost like mock scenarios where the dad kind of pretends like he’s the dealership, the car salesman guy, or he’s the finance manager. And so they go through in more detail on a lot of things that we’ve kind of alluded to on this. So I think that’s another really good one is go through and just learn how the tricks and these add-ons and all this other nonsense stuff that they’re just trying to make money on.
Bob:
It’s because the dad was in the car, he’s been in the car business for a very long time and some examples they’ll give you and I’m going to give you right now is don’t ever buy a car just on car payment. That’s crazy.
Shawn:
The price is what actually matters.
Bob:
Right. Because the car payment, even though you may be buying a car on payment, what interest rate are they charging? How long are the terms? They really hark a lot on that program about the extended warranties and how a huge markup.
Shawn:
Paint protection.
Bob:
Right. So these extras all have a lot of markup and you just don’t need ’em. Stay away from it.
Shawn:
High markup and little to no value.
Bob:
Number five, do not allow emotions at all to play into the vehicle deal. I know that’s hard, but you’ve heard me say over and over that emotions have no place in financial transactions. They just don’t have a place in it. Don’t let the car person manipulate you, folks. I’m sorry, and I don’t mean to be putting down. There’s just some good car salespeople that even go to our church.
Shawn:
But they will try to be your best friend. They will tell you what you want to hear. Bob’s been in the investment industry a long time and he’s heard it countless times of, “Well, what is it you do? Oh, I really need to talk to you about that. I really need to do some financial planning or I like that you guys are a Christian company. I really want to work with that.” And then weird how after Bob bought the car that they never called him, never one time, just disappeared.
Bob:
I’ve never had it happen one single time.
Shawn:
But they’re saying all this, they’re doing this because they’re paid on a commission. They have a significant conflict of interest to do what’s in their best interest monetarily and not yours, all the way down to signing the paperwork in the finance office where they try to sell you more so that sales guy is not your lifeline to make sure that the finance manager isn’t raking you over the coals. They’re still trying to close that deal.
Bob:
And they’re trying to sell you those extras. The finance manager gets paid based on that, too. So throughout the whole thing, it’s just spending extra thousands and thousands of dollars if you don’t follow these guidelines that we’re putting in place for you.
Shawn:
So be on your guard and be very suspicious until you are finally home with the new car, right? Or the new-to-you card.
Bob:
And unfortunately, I’m sorry you have to do that, but you have to. Okay, number six, do everything online, if possible. This is where I said in the beginning, you go find the car that you want, but from that point, the only time you should step into the dealership again would be the day you buy it.
Shawn:
Or you’re picking up the vehicle. Maybe you even sign the paperwork electronically and so you’re just walking in to pick up the keys and get a copy of the executed paperwork.
Bob:
So many benefits to doing that. The emotions are not there. The price transparency is. You’re not under pressure.
Shawn:
It’s a lot more convenient.
Bob:
You get to read all the paperwork, the speed, and you get the selection of the vehicle that you want. So there’s so many benefits to buying that car lot online. And then we come down to the seventh and I think one of the most important points of buying a car, because it is one of the largest purchases you do in your life besides your home.
Shawn:
Pray about the decision.
Bob:
Yes.
Shawn:
Because this is not a decision that you should be making quickly. It’s not a decision that you should be making under pressure. There is no emergency to buy that car. It doesn’t matter what it is. Doesn’t matter how good the car people, salespeople think the deal is.
Bob:
Even if it’s broken down, you can go rent a car for a few days.
Shawn:
Exactly. So pray about it. Seek wise counsel from someone with your best interest in mind, not a salesperson.
Bob:
And integrate, because it’s such a large purchase today, it needs to be integrated into a financial plan, in my opinion. As we get to the point, like I said in the beginning, over the years, vehicle purchases have cost people many hundreds of thousands of dollars and lost net worth in the future.
Shawn:
Without anything really to show for it.
Bob:
Yeah, exactly.
Shawn:
Buying vehicles is usually the second largest expenditure that most people will make in life besides buying home.
Bob:
So, let’s end on the scripture we started with.
Shawn:
That’s right, James 1:5, “If any of you lacks wisdom, you should ask God who gives generously to all without finding fault and it will be given to you.” Thanks for joining us. Feel free to post stuff in the comments if there’s any other topics that you want us to cover. It doesn’t have to be about investments. If we can tie it to finance, we’re happy to help. Thanks, God bless.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 185 – The High Cost of Cash Value Life InsuranceThe High Cost of Cash Value Life InsuranceDiscover which type of life insurance should be best for you!
More episodes >>
Are sky high fees making cash value life insurance a poor investment for you? Should you just buy term life insurance and invest the difference yourself? Bob and Shawn discuss the true cost of cash value life insurance, such as whole life and universal life. Life insurance is almost always a must to protect your family and immediate loved ones in the case of your death, especially from your 20’s to 60’s.
This episode highlights the various fees and charges associated with these policies, including upfront premium loads and surrender charges. No matter what you decide after listening to this episode, it is highly recommended to seek advice from a fee-based advisor or CPA.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodeLUKE 14:28-29Suppose one of you wants to build a tower. Won’t you first sit down and estimate the cost to see if you have enough money to complete it? For if you lay the foundation and are not able to finish it, everyone who sees it will ridicule you.
PROVERBS 22:3The prudent see danger and take refuge, but the simple keep going and pay the penalty.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTShawn:
Are sky high fees making cash value life insurance a poor investment for you? Should you just buy term and invest the difference yourself? Let’s get some perspective.
Welcome to another episode of Christian Financial Perspectives. We’re so glad that you’ve joined us, whether that’s video or audio. My name is Shawn Peters and I’m joined as always by my co-host, Bob Barber. And today we are going to be talking about the true cost of cash value life insurance, which of course goes by many different names, the most common being whole life and universal life. And we’re going to talk a little bit about some scriptures that I think go really well with this and when it is actually useful versus when many times it gets sold. And so, really the point of this is either it’s for you if you’re considering whole universal life or probably someone that you know, hopefully this will help them make the right decision. So as with all things, we want to start with scripture and we want to make sure that we equip people to make good financial decisions using Biblical principles. So Bob, anything to add before we get into the scripture?
Bob:
Nope, I think we’re ready. Okay.
Shawn:
Luke 14:28-29, “Suppose one of you wants to build a tower, won’t you first sit down and estimate the cost to see if you have enough money to complete it for? If you lay the foundation and are not able to finish it, everyone who sees it will ridicule you.”
Bob:
So I want to say something here. The reason I picked this scripture, and we’ve used this scripture many times, but one of the reasons estimating the cost is talked about in this scripture. You’ve got to know the cost of something before you go into it, not after you’re already in it.
Shawn:
That’s right, that’s right. And our second verse, Proverbs 22:3, “The prudent see danger and take refuge, but the simple keep going and pay the penalty.”
Bob:
You could pay severe penalties with cash value life insurance, which we will talk about later.
Shawn:
That’s right. Okay. Cash value life insurance, unlike straightforward term life insurance in most cases, is sold as 1) A retirement plan alternative; 2) a college savings plan; 3) Bank on yourself plan; 4) A savings plan; and 5) Which in some cases for very highly valued estate to cover estate taxes and other complex planning cases for taxes.
Bob:
That’s about 1/10th of the population on that fifth one by the way. Okay. Because it means your estate would have to probably be over $20 million before there’s going to be an estate tax problem, a married couple.
Shawn:
So anything we should know yet on those five, Bob?
Bob:
Not really, but I know Shawn, that what got me excited about this was a couple of weeks ago you sent me a video about this bank on yourself plan.
Shawn:
That’s right. I think the current term that they’re using is “infinite banking”.
Bob:
Oh, is that what they’re using today?
Shawn:
Yeah. I think that’s what they’re calling it.
Bob:
The bank on yourself plan is what they were using 20 years ago.
Shawn:
It’s same thing, just slightly different name.
Bob:
We’ll go into this, but I think it’s important that you know this is how cash value life insurance is sold, and there’s four types of cash value life insurance policies. Their main one is variable universal life. And that has to do with, you could pick any, you have your pick of subaccounts that are like S&P 500 index or a large cap fund, small cap fund etc.
Shawn:
It functions a little bit more like a variable annuity, for example.
Bob:
It does.
Shawn:
Similar.
Bob:
Even a 401k that has all your choices in it. Okay. Another one is indexed universal life. That came out when fixed indexed annuities came out. Then we have universal life that came about, gosh, that’s been around 35 or 40 years. It’s kind of tied to the interest rates where interest rates are. So it may be getting more attractive today with interest rates being higher. And then the old kind of policy, whole life life insurance. Whole life insurance has been around, I think, probably a hundred years or longer. It’s built empires, I can tell you that. We share later in the program. Today, I was writing this thinking about this, is that the largest nicest buildings in America are life insurance buildings, life insurance buildings.
Shawn:
It’s almost like they’re making money off of that.
Bob:
Yeah, I think so. Exactly. You think about cash value life insurance, there’s a lot of fees and expenses, and that’s what we’re here to really educate you on. We’re here about educating you with wisdom. So we’re going to go through a lot of the cost of a cash value life insurance plan. Remember, that’s just universal life, variable universal life, whole life, or indexed universal life. The number one thing up front is that even before your money goes in, Shawn, there’s an upfront premium load in sales charge that compensates for the sales expenses. This is for marketing the policy. The high commissions that are paid to the life insurance agent that sells this. And also most people don’t realize this, there’s state and local taxes that actually come with cash value life insurance, and they’re deducted from every single payment made to the policy before it’s even applied to it. So right up front, it’s usually a 5-7% charge, which is pretty high.
Shawn:
Kind of look at that as when people have a mortgage payment earlier in the loan, there’s obviously a pretty high percentage of the regular payment that goes to the interest. So you’ve got to pay well over and above that if you want to actually try to pay it down in the capital faster. So same thing here. So you have that premium that you’re paying, but there’s quite a bit in fees, it gets taken right off the top.
Bob:
So if you’re paying a $200 a month premium or payment, they call it premiums in the insurance industry, then you could think about $20, probably around $20, $15-20 of that has already just kind of taken off the table. Okay. Next are the ongoing administrative fees, which can also, that comes out, too. So now, you’ve had this upfront load come out. Now you’ve got this ongoing administrative fee that’s used to pay the policy costs, all the accounting and the record keeping that goes into this. And these are usually deducted monthly or some cases it’ll be annually, which is another charge.
Shawn:
That’s right. So next, number three, we have mortality and expense risk charges. So when a life insurance company issues a policy, they estimate you’ll live to a certain age based on your current age, gender, and health. A mortality and expense charge compensates them if the insured does not live to the estimated age. This charge is generally once a month.
Bob:
So now we’re at three different charges. Right?
Shawn:
That’s right. We’re already at three different charges.
Bob:
There’s a lot being taken out. Next is if the sub-accounts are in there, there’s high fund management fees. You’ll notice that the fees are higher inside of a variable universal life than it is outside by itself or like an ETF that you could buy really low cost out in the marketplace.
Shawn:
So effectively it’s another fee where those funds that you’re in, you’re getting charged to be in those funds within that life insurance policy.
Bob:
Charged a little bit more possibly than you are if you’d just gone direct to those funds. Okay. A little bit in there for the insurance company and then…
Shawn:
We thought taxes were bad.
Bob:
Yeah, I mean this just, it really starts taking out, it’s chipping away more and more and more chipping away. And then we do have, which is kind of like the mortality expense charge, but it’s the actual life insurance cost itself, which if you buy term and invest the rest, you’re still going to have that life insurance cost. But this is based on your age and your gender, your underwriting classification. How healthy are you when they’re issuing the policy?
Shawn:
Well, and of course this particular cost compared to term is also going to be quite a bit more expensive since term at least has a fixed term or period like the name implies. But with these different types of cash value life insurance, they don’t have an expiration. So just comparing apples to apples, it’s still going to have a slightly higher insurance cost itself.
Bob:
And again, this charge is assessed monthly.
Shawn:
That’s right. So another monthly fee. So the last one are high surrender charges and fees that are deducted from the cash value if you surrender or terminate the life insurance cash value policy during the surrender charge period, which usually varies between 10-15 years, a fairly long time.
Bob:
That’s a long time. It really is. So you go put $20,000 or $50,000 in one of these, it could be a very, very long time before you can get that 50k plus all the earnings that it’s making back.
Shawn:
That’s right. And they do that obviously, because the insurance company doesn’t really want you to pull the money back out or surrender it early.
Bob:
And you’ve got to evaluate all these different fees that go into it. It’s very, very important to do that. I mean, the question is, should you buy cash value life insurance as a retirement, college savings, bank on yourself, or savings type of plan? And Shawn, in almost all cases, the mathematical answer to this question, you know me, I always say it’s just math, is a resounding no. No, you shouldn’t.
Shawn:
So almost all cases when you look at the math, the answer is no, you should not.
Bob:
Right. You’re better off buying a much less expensive straight term, 10 or 20 year level term policy.
Shawn:
You could even do 30 if you wanted, especially if you’re starting younger.
Bob:
When it first started off with term, it was just annual renewable term, and then they went to the level 5, 10, 15, 20, and now, yeah, you can go all the way 30 years out and if you’re in your mid thirties, buy a 30 year term and they’re going to, I mean the prices are so much lower than buying whole life. Take that difference, because you’re buying it pennies on the dollar.
Shawn:
Oh yeah. I got a 30 year term life insurance when Jenna and I first got married. And so I’m still in my twenties and I mean it’s super cheap. I’d have to go look at the bill, but I mean it’s very, very cheap. And then when I went to get an additional policy, another 30 year in my early thirties after Rhonan was born, it was quite a bit more expensive, but still very cheap. It was more than what it was in my twenties, but still even in my thirties, getting another 30 year to add some additional coverage on there just in case something happens to me and the house gets paid off, the kids have money, and it’s crazy how cheap it still is, even in your thirties.
Bob:
It’s cheap for a 30 year old. It’s not cheap at 61, though. Y’all I’m there now, but thank goodness I don’t need life insurance anymore. The kids are out of the nest. We have adequate savings and investments, we’re debt free, so we don’t need life insurance anymore.
Shawn:
Well that’s really the point when you hear people say, “Buy term and invest the rest,” the reason for that is when you look at a chart and you’re looking at over time, basically your term life insurance in this case is to help cover the assets that your family might need if something should happen to you prematurely. But over time, as you continue to build your savings and your investment assets, that number will be higher and higher than your term to where eventually when the term turns out you don’t need it. That’s kind of the whole point is to help you get over that difference.
Bob:
The whole goal is you start off with this amount of insurance you can see here and you’re this much in savings and they flip flop.
Shawn:
Exactly.
Bob:
And then the savings comes up here and you’ve got your insurance down here. And it makes sense because the older you get the insurance companies, there’s mortality tables, they know you’re getting closer. We’re all going to die someday. And the older you get, the less years you have.
Shawn:
So you’re saying someone at 85 is more likely that they might not live another 30 years than someone in their thirties?
Bob:
Exactly. All these expenses that we went over today are very important to understand and know. I do want to say this, though. There are some cases for those that want permanent life insurance…
Shawn:
Where it makes sense.
Bob:
It makes sense. Right. Because you have a level premium your whole life. Also, if any health issues change, it’s there with you. It’s not going away. Other reasons may be, like we mentioned at the beginning, if you have a major estate tax problem, but today, husband and wife together combined, estate planning, you have to be over 20 million. That means 1/10th of the population needs that.
Shawn:
If you need the life insurance for that. Congrats. You’ve done pretty well.
Bob:
I do want to mention that there is 99% of the cases we’re saying buy that term, but in whole life, universal life, index life, there is a clear winner in these policies. You want to say who the clear winners are, Shawn?
Shawn:
In someone actually buying one of these cash value life insurance, right?
Bob:
Yeah.
Shawn:
The sales person and the insurance company.
Bob:
Exactly.
Shawn:
Because the sales person gets the huge commission. The insurance company gets to collect not just your premiums, but all the extra fees and expenses for years on end, like we talked about before. It could be 15 years, even if you wanted to get out of it, or you pay a bunch of penalties. Yeah. I mean, why do you think insurance agents and insurance companies love it so much?
Bob:
And that’s one of the reasons a good old farmer told me one time that the insurance companies and banks are built of marble and granite and our homes are built of sticks and stones. So bottom line is count the cost. Like we said in the beginning with the scripture we shared. Count all the costs before entering into a cash value life insurance policy such as whole life, universal life, et cetera, and have a fiduciary fee-based advisor or CPA that does not sell life insurance. There’s no reason for them to analyze the real facts about what you’re getting into. It’s very, very important. Don’t have a commission-based life insurance person.
Shawn:
Yeah. I mean it’s a conflict of interest. I know that maybe should seem obvious, but the point is don’t ask someone for advice about whether or not you should buy a product that they directly benefit significantly from financially. It’s not a good idea.
Bob:
And they are taught Shawn in class after class how to make it look appealing, and they’re very good at what they do because they spend hours of teaching how to sell these policies.
Shawn:
Yes. Because it’s about selling the policy, not what’s doing right for the client.
Bob:
In the end, folks, life insurance is very important. It’s very important for somebody, especially like you, Shawn, you’re younger, you haven’t gotten to the millions yet or even the hundreds of thousands yet, okay. And with that term policy, immediately you’re covering your family. I have seen many, many cases, I’ve been around a long time in this business, over 30 years, and I’ve seen families saved where the breadwinner has had a unfortunate either accident or a disease like cancer strike them and take their lives. And thank goodness the life insurance was there. As a general rule of thumb, I always say multiply your annual income times 10-15x and that’s the amount of insurance you should need. So if you’re making a hundred thousand a year, you need about a million to a million and a half of coverage, and it’s not going to be much with a term policy. Go with a term policy. And by the way, don’t forget to invest the rest. I would say if you got a good 401k, invest in that 401k and take that match that your employer’s giving.
Shawn:
Max that out as much as you can. That’s right.
Bob:
I hope this has been educational today.
Shawn:
Yeah, hopefully. If this doesn’t apply to you because you’re not considering one of the cash value life insurance, I’m sure you know someone that is considering it or has talked about it or will come up in conversation at some point. So hopefully this will help them as well. Alright, well thanks as always for joining us and God bless.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 184 – Year End Charitable Gifting IdeasYear End Charitable Gifting IdeasCash giving isn’t the only option when it comes to supporting your favorite charities!
More episodes >>
Want to give beyond just cash this year? Donate stocks, real estate, required IRA distributions, and more by December 31st. Bob and Shawn discuss the importance of alternative non-cash giving, as the majority of charitable giving is done through cash despite cash being a small portion of people’s assets.
Various options for non-cash giving are discussed in depth, including opening a donor-advised fund, contributing to a charitable gift annuity, donating appreciated stocks, and donating other valuable assets. Tune in now to learn about the many ways to give to your favorite charities in unique ways that continue to offer support for many years down the road.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersFidelity CharitableWebsiteNational Christian FoundationWebsiteVimeoInstagramBible Verses In This EpisodeACTS 20:35In everything I showed you that by working hard in this way you must help the weak and remember the words of the Lord Jesus, that He Himself said, “It is more blessed to give than to receive.”
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTShawn:
Want to give beyond just cash this year? Donate stocks, real estate, required IRA distributions, and more by December 31st. Let’s get some perspective.
Hi, my name is Shawn Peters. I’m joined as always by my father-in-law and Co-host Bob Barber. Today we’re going to be talking about year-end charitable giving ideas. And this is really helpful because there’s still time between now and the end of the year, assuming you watch this within the first week or so of being published. But our scripture for today is going to be Acts 20:35, “In everything I showed you that by working hard in this way, you must help the weak and remember the words of the Lord Jesus that he himself said, ‘It is more blessed to give than to receive.'” For those of you who don’t know, Bob is the one who puts most, if not all, of the scripts and information together for this. So Bob, do you have any quick comments before we get started?
Bob:
I do Shawn, and I think the main emphasis here in the scripture is that it is actually more blessed to give than receive. And I don’t think people will understand that until they start giving. We’re all about giving to Compassion here in a huge way and sponsor all these children. And gosh, I’m blessed by that. So we’re going to share with you seven ideas today, and the most important thing I want you to reach from today is not just giving, but that most all charitable giving, 90-95% of that is done from cash, right? So there’s the other 90-95% that no one ever thinks about giving. And today we’re going to talk about non-cash giving a lot. So a few of these will involve cash, but others won’t.
Shawn:
So basically the majority of charitable giving is through cash, even though that’s a fairly small portion of assets that people control.
Bob:
I remember seeing a pie chart where, yeah, there’s just this little bitty piece of pie. That’s what we have in cash. The rest of it is in IRAs, mutual funds, brokerage accounts, bank accounts, saving accounts, and the list goes on.
Shawn:
Alright, well that takes us right into number one, which is open a donor-advised fund. A donor-advised fund or DAF is like a charitable investment account to support charitable organizations that you care about. When you contribute cash securities or other assets to a donor-advised fund at a public charity, like Fidelity Charitable, you are generally eligible to take an immediate tax deduction. Then those funds can be invested for tax-free growth and you can recommend grants to any eligible, IRS qualified public charity.
Bob:
So there’s a lot of these donor-advised funds that are offered. Fidelity was one that you mentioned. There’s the National Christian Foundation, and I like using them. But the nice thing about a donor-advised fund is you can give it anytime you want to. You can give all kinds of different things like cash, not just cash. Yeah, I mean you could give a precious piece of art that may be worth a couple thousand dollars. You could give that to the donor advised fund. It would be a deduction. And then like you say, it’s likes like a bank account. It’s like a charitable banking account in which you can give it now, get the deduction now. This is why it’s so important that we’re doing this right now at the beginning of December.
Shawn:
Because there’s still time.
Bob:
Because you can get the deduction, but you don’t have to give it to the charity next year or even the following year. You could give at a later time.
Shawn:
Maybe this would be an easier way for our viewers and listeners to reconcile. So you’re getting the deduction immediately, but when that charitable gift goes to the charity, it does not have to be at the same time.
Bob:
That’s correct. That’s right.
Shawn:
So you’re kind of separating those where obviously when you give cash to a charity, it’s an immediate, it’s a deduction for that tax year, but it also immediately goes to the charity. This allows you to make those deductions, but you can wait until later for whatever reason, but you can wait until later to actually give it to the charity.
Bob:
Why would you do that? Maybe you’re getting a huge bonus and you want to give, you need a deduction right before the end of the year. So you could give a third of that a bonus or 40 or 50% or all of that.
Shawn:
Or maybe you’re accumulating a lot of assets or maybe it’s stocks and securities, you want to allow them to grow and then later you want to start doing a regular contribution per year to the charity out of that donor advised fund.
Bob:
You absolutely can.
Shawn:
Awesome. Okay, so number two, contribute to a charitable gift annuity. This one sounds similar. Bob, do you want to cover this one?
Bob:
So a charitable gift annuity is a contract between a donor and a charity with the following terms. As a donor, you make a sizable gift to a charity using cash, again, securities or any other assets. But in return, this is what’s interesting about a charitable gift return annuity. In return, you’ll be eligible to take a partial tax deduction and get back a fixed income stream. So somebody that’s very charitably minded, but they need an income from maybe what they have in savings and you’re going to get a very competitive interest rate on a charitable gift annuity. So you don’t get a full deduction for it, but you get still a large deduction that can be carried over in future years. Also, if you don’t use it all this year.
Shawn:
Very similar to a normal annuity in that you annuitize and you’re going to start getting an income. But the interesting part of this is that there’s a partial tax deduction that you receive for that upfront donation.
Bob:
And the part that you may not use that’s in the annuity goes to charity. That can be, you can name a donor advised fund. So it can be a family donor advised fund, where if you do an annuitize with an annuity with an insurance company, they’re going to keep the money versus charitable organization keeping the money. Okay.
Shawn:
I like sound of that. Alright, so number three, donate appreciated stocks. So you can donate to a donor-advised fund or you can do this as a ministry for churches.
Bob:
Which is what we do.
Shawn:
Exactly. Sorry. We will do that as a ministry.
Bob:
We’ll do it as a ministry for your church. We will open a brokerage account and you can donate a stock to it once the brokerage account’s in the name of your church, and then you’ll get that deduction for what the security is worth, what the stock is worth, and then we’ll sell it for your church so they can use that for ministry. We do this all for free. This is a ministry of Christian Financial Advisors. Does that make sense?
Shawn:
Yep. I was just reading it wrong.
Bob:
Now, when we say appreciated stock, not a lot this year maybe, but hey, if you bought some, what was it, Navidia at the beginning of the year and went up, what, 80% maybe you want to give some of that if you bought that particular stock.
Shawn:
So number four, donate real estate. So it could be raw land, a residential lot, any other kind of acreage, et cetera. I mean there are obviously a lot of different types of real estate – that you aren’t planning on ever using or selling.
Bob:
So I have a great example here. We had a client that did this in San Antonio. She had about a three acre lot on the corner of a very high traffic location. And this thing went, I mean it went up in value and was worth about a million and a half dollars. She loved a Christian school that she went to in her earlier years, and this still is a very strong Christian school. I don’t want to mention the name of that.
Shawn:
Yeah, we don’t want to give too many exact details.
Bob:
She did a charitable gift annuity with that and donated that lot that she had in San Antonio in that commercial district and got the full deduction. She didn’t have to pay any taxes at all.
Shawn:
So she generated an income off of a lot she really didn’t plan on do anything with.
Bob:
That’s right, for the rest of her life.
Shawn:
And then when she does pass away, the school is able to do whatever they want with it.
Bob:
They sell it.
Shawn:
Or they can build on it.
Bob:
What might be left of what’s left in the annuity.
Shawn:
Wow, that’s awesome.
Bob:
Now, if she lives to 120 years old, there might not be anything left in that annuity.
Shawn:
Okay. Wow, that’s a great one. So number five, make those required minimum distributions or RMDs, make them through a qualified charitable distribution.
Bob:
We refer to that as a QCD.
Shawn:
Exactly. QCD. So there are clients of ours that have accounts with RMDs, but because of their other, maybe the pension, social security, whatever the case may be, but they have RMDs they really don’t need. Well the government wants you to make those RMDs though because they want to get the tax money. So if you’re in a situation like that, either partial or full RMD, you can go through a qualified charitable distribution to satisfy that requirement, but payable to a qualified charity.
Bob:
And it makes so much sense because you don’t want the money coming to you and then give it to the charity because then you may not be able to deduct it. You declare it as income.
Shawn:
The way this works is a QCD is a direct transfer of funds from your IRA. The custodian does this for you, but from the IRA paid to the qualified charity. So because of that, it satisfies the RMD requirement, but since it never goes into your hands, it goes straight from the custodian in the IRA to the charity, it doesn’t create that taxable event on the RMD. So, I love that as an option if you’re in that situation, you don’t need the RMD, well just give it to the church or give it to a charity.
Bob:
We have a lot of people like that, Shawn, because in our area we have a large military retirement crowd, I guess. And because they were stationed in San Antonio years ago and they like to come back and retire in this area and really from their pensions, from their pension plan they’re getting from the government, than their social security. And if they worked outside of the workplace anywhere, they have more than they need. But then comes this RMD, and by the way, you can go beyond the RMD once you’re in that age bracket, you have to be in the age bracket of an RMD, which is 70.5 or older. Now, it’s going to 73 because that’s when the RMD requirements for somebody my age is going to be 73 years old. But I’m way away from that by the way. I’ve still got a lot of years to go there. But you can go much larger than the RMD itself. You can go up to a hundred thousand dollars if you wanted to. Not that you would do that, but I’m just say your RMD is supposed to be $8,000. Well, you could give $15,000 to your charity. And I really emphasize that people use their RMD in lieu of cash giving to their church. If you’re tithing to your church, give from your RMD as a tithe, it makes so much sense financially and tax wise.
Shawn:
Just assume you’re in a lower tax bracket. Even at 20-22% range, you’re giving 20-22% more to your church by using the money as a qualified charitable distribution from your IRA instead of paying the cash. So it just makes sense if you are already going to give some money to the church anyway and you have an RMD, use that as a qualified charitable distribution.
Bob:
And another thing is this year, for the first time
Shawn:
2023.
Bob:
Yep. You can give a QCD qualified charitable distribution to a charitable gift annuity up to a maximum onetime event of $50,000.
Shawn:
Wow. That’s awesome.
Bob:
Alright, now we’re down to the last two, number six and number seven.
Shawn:
Number six is donating physical gold or silver or whatever precious metal, but donating physical precious metals.
Bob:
Just think about this folks. Are you really going to take the gold to the gas station and buy gas with it? Are you going to take it to HEB? They’re probably not going to accept it. Well, I say HEB in our area. I know some of you up north, you don’t know what that means, but that’s our local big grocery store chain here in Texas.
Shawn:
That’s the place to go. We have a whole episode on that. Should check out our episode on gold. So number seven, donate an old car, truck, or anything of value like loan notes, estate gifts, retirement plans, mineral rights, oil and gas royalties, copyrights and intellectual property, or patents. Really anything that has some sort of intrinsic value and you can donate that as well.
Bob:
So there you have it. There’s seven ideas for donating. Many of those, as you can see, they’re non-cash gifts. It comes back to that. Remember that the majority of what we have is not in cash.
Shawn:
That’s right.
Bob:
So let’s give from the non-cash and make it tax efficient as well. Now if you need help with all of this, this is a lot of charitable giving ideas, give us a call. I also want to emphasize if you want to make this a deduction for this year, it needs to be done by December 31st. And please don’t be calling us on December 30th. You’ve got two weeks to make a decision on this, basically, because we got to set this in motion. It’s going to take a few days and with Christmas and everything…do it now.
Shawn:
I would just say if you haven’t actually started the process of opening whatever account or whatever the situation is by December 15th, it’s too late. You’re not going to have enough time.
Bob:
So sit down with your spouse tonight and talk about this and y’all get together and get your tray tables out and go to YouTube and watch this online.
Shawn:
Thanks for joining us as always and God bless.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 183 – 7 Takeaways For Christmas Spending7 Takeaways For Christmas SpendingWe discuss seven budget friendly ways to give gifts this Christmas season.
More episodes >>
Want to avoid debt this Christmas? Make a budget, limit gifts, and remember the reason for the season – Jesus. Bob and Shawn discuss seven takeaways for Christmas spending. Some takeaways suggest using cash or a debit card instead of a credit card to prevent overspending. Thoughtful and meaningful gifts that will be remembered are usually better than expensive gifts. This Christmas, don’t forget to focus on the true meaning of Christmas and to have fun giving gifts!
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodeMATTHEW 1:18-22This is how the birth of Jesus the Messiah came about: His mother Mary was pledged to be married to Joseph, but before they came together, she was found to be pregnant through the Holy Spirit. Because Joseph her husband was faithful to the law, and yet did not want to expose her to public disgrace, he had in mind to divorce her quietly.
But after he had considered this, an angel of the Lord appeared to him in a dream and said, “Joseph son of David, do not be afraid to take Mary home as your wife, because what is conceived in her is from the Holy Spirit. She will give birth to a son, and you are to give him the name Jesus, because he will save his people from their sins.”
All this took place to fulfill what the Lord had said through the prophet: “The virgin will conceive and give birth to a son, and they will call him Immanuel” (which means “God with us”).
JOHN 1:1-5;14In the beginning was the Word, and the Word was with God, and the Word was God. He was with God in the beginning. Through him all things were made; without him nothing was made that has been made. In him was life, and that life was the light of all mankind. The light shines in the darkness, and the darkness has not overcome it.
The Word became flesh and made his dwelling among us. We have seen his glory, the glory of the one and only Son, who came from the Father, full of grace and truth.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTShawn:
Want to avoid debt this Christmas? Make a budget, limit gifts, and remember the reason for the season – Jesus. Let’s get some Christmas perspective.
Welcome to another episode of Christian Financial Perspectives. We’re so glad that you’ve joined us. My name is Shawn Peters and my co-host joins me, Bob Barber. Today we’re going to be talking about seven takeaways for Christmas spending. And the idea of this, of course, is well, we’re a financial podcast, so we got to find some sort of financial topic for Christmas, right, Bob?
Bob:
Well, and Thanksgiving is next week. That’s right. And what is it, they call it Black Friday. And if you still get the old fashioned newspaper comes where it’s about two or three inches thick full of ads. And everybody is, I mean, I know 20 years ago, I dunno if this still goes on because I don’t do it, but I know 20 years ago, 25 years ago, everybody was up on Friday morning after Thanksgiving, about 5:00 AM in the morning hitting the Walmarts and the Best Buys of the world.
Shawn:
And now so many of those things end up being available online Christmas day in the afternoon or Friday morning.
Bob:
Yeah, we all it cyber, right? Cyber Black Friday or Cyber Monday, things like that.
Shawn:
What we thought would be very helpful is, and some of these may seem a little redundant maybe, or you’ve heard ’em before, but repetition, repetition, repetition.
Bob:
Well, it’s good wisdom. And I think the scripture I picked to go with seven takeaways for Christmas spending is from Proverbs 22:7. Now you’ve heard us say this on Christian Financial Perspectives, “The rich rule over the poor and the borrower is slave to the lender,” which takes us to our first takeaway. And that is some people can pay off that credit card and are great about it. I mean, I know you and Jenna use a credit card and you’re so disciplined.
Shawn:
The reason for it.
Bob:
But you’re the half percent.
Shawn:
Yes, we might be the exception, but the reason why is for a lot of people, Bob, when they look at a credit card, there’s no budget in place in the first place. And so, we treat our credit card for us at least like a debit card because whatever money we’re spending, it’s already in the bank. We only do it because it racks up points for us.
Bob:
You’re different, Shawn.
Shawn:
I know it’s different. So in general, I would say the rule of thumb is do not use the credit card.
Bob:
Do not use a credit card. Do not go into any debt over Christmas spending. Buy it with cash and what you have in savings. Oh goodness. That’s a really big one, isn’t it?
Shawn:
It’s a big one. But keep this in mind. Some of these takeaways will be applicable for going into this Christmas season. Some of it might not. You might have to implement this for the next year, so don’t be discouraged. But whether it’s this year or next year, again, yes, do not go into debt just to buy gifts.
Bob:
It’s not worth it. So what you’ve got to do right now, right now, is figure out what’s the total that you can spend on Christmas. Not what you want to spend, but what you can spend. And that’s from what you have in cash in savings basically right now. And only use cash or a debit card. I know the majority of us now are going to buy our Christmas gifts online, so that’s going to require a debit card.
Shawn:
So you can use debit card for that.
Bob:
But use a debit card. A credit card company is not going to say when you get to a limit, they’re going to want you to keep going. They love charging that high interest. But a debit card, there’s only a certain amount that you can do. So I tell you, it’s a really great way to not overspend is coming from cash and a debit card.
Shawn:
Exactly. Yep. And that’s the main thing with that is so you don’t go over whatever that budget or limit is that you set. The credit card makes it so easy to go over that budget. So number two, make a list of every person and every charitable organization that you want to give a gift to this year for Christmas. Which kind of goes back into the budgeting as well.
Bob:
It does. It does.
Shawn:
Yeah. Okay, great. Well, you figured out how much you can spend now go through your list. Okay, great. Well, how much can I spend for each person or organization? And then you go from there.
Bob:
And number three. So number three, this is an idea that is an old idea, Shawn. It’s very, very old.
Shawn:
This is like white elephant or something like that. But take the pressure off. And this is going to depend on the family, obviously.
Bob:
It does, it does.
Shawn:
But for some families, especially if you have a really big family that always gets together.
Bob:
This is the third takeaway.
Shawn:
This is number three. So the third is take the pressure off of people in the family, especially again, if you’ve got a big family, what you may want to do is instead of everybody trying to buy presents for 10, 15, 20 people, well maybe you guys just do the white elephant deal where you draw a name from a hat.
Bob:
You draw a name, exactly. Draw from a hat. Figuratively speaking, what you try to do is you get each family member’s name, you put it in a hat. Now I know you’re not going to probably put it in a hat.
Shawn:
Figuratively, put it in a hat.
Bob:
This is the old fashioned way. You’d put it in a hat and their name is on it. And then everybody draws a name out of the hat. Alright? And that’s who you’re going to buy a gift for. And Shawn, this has meant more for the family members. There’s going to be some family members that can’t afford to buy gifts for everyone. And then there’s going to be the ones that can afford to buy a gift for everyone plus 10 more.
Shawn:
It’s multifaceted. Because the thing is, if you’ve got a lot of family members, even if someone is budgeting a very small amount and trying to be creative, my wife always does creative stuff. Hers is the time that she put into it. But even still, it’s hard to buy gifts if you’ve got a large family. And so this is one option. However, keep in mind if you go this route, there’s going to be that aunt or grandma or somebody that’s like, I don’t care. I’m going to buy gifts for everybody still anyway.
Bob:
Wait, that’s going to be my wife. Definitely Rachael does that.
Shawn:
Some people just love that. Some people, their love language is definitely gift giving. So do not try to tell them that for their Super Bowl for gift giving that they’re not allowed to give gifts.
Bob:
But the thing is, Shawn, I really believe God never intended for Christmas to end up being a financial burden.
Shawn:
Well, of course.
Bob:
But it does, especially here in America. It can end up being a financial burden for some people if you have a large family. So this is a way that instead of having to buy 10 gifts, you can buy one. You can actually be more meaningful in that gift and maybe spend a little bit more on the one gift than you would on 10 gifts, not 10 gifts combined. But you understand, right?
Shawn:
Sure, yeah. And if you’re in a situation where, again, refer back to number one, if your family, everyone’s buying gifts for everyone. Remember number one, do not go into debt of any kind to get gifts, get creative. Alright? There are a lot of gifts that you can give in that situation that require $0. But just time, especially for your family members that quality time is their love language. So refer to number one on all these. Don’t go into debt no matter what the situation is.
Bob:
Which takes us right to number four. Again, allocate a budget to each person and charitable organization on your list. Total that number, then adjust as necessary to stay within budget. Now Rachael told me about an app that we’ve been using for several years. I did not know this until just a couple of days ago that she’d been using this app.
Shawn:
Well, Bob, I will say you’re probably more the classic dad of, “Wait, what did we get the kids?” Rachael handles all that. No problem. What’d you get? What did I get you?
Bob:
But it’s called the Christmas list app. You actually just go into the app store. I went this morning, “The Christmas List”, and so you can write everybody’s name down. Then you put the amount you’re going to spend and it actually keeps a running total for each person.
Shawn:
So you don’t forget anybody either.
Bob:
So anyway, that’s out there today and most of us have a smartphone, so that’s a great way to do it.
Shawn:
Yeah. So number five, think long and hard about the gift you want to give. Will it be remembered one to three years from now or longer or forgotten about in the next month or two? And I think a great example of this one, I think it was last year or the year before, but my sister-in-law, your middle daughter, she got my wife, these earrings. Now when I say she got her these earrings, she made her a set of earrings. So if I had to guess less than $10, I’m assuming, in materials, she does this for a lot of people. But that is something that she, Jenna wears those earrings all the time. She loves that gift. So that’s something that didn’t cost a lot of money, but has a lot of meaning and value because it was that time and effort that she put into it. Plus it’s something that she can wear all the time. It doesn’t get used up one time.
Bob:
Now his wife, my daughter, she gives me coconut every year.
Shawn:
Well, coconut flavored everything.
Bob:
Coconut drinks, coconut everything. She knows, I love everything coconut with coconut in it. So she goes out. But I remember that, okay, because I’m like, okay, what’s she going to get me this year? Oh, I eat every bit of it. And I don’t know, I don’t know, it’s maybe a $15 basket of coconuts, but I’d love it. And I remember it every year. If she got me something else, I might not remember it. And you know what? I doubt most of us can remember five gifts that we got in the last three years or years.
Shawn:
Or it’s the ones that are actually more thoughtful.
Bob:
Exactly. Like you said, the sister-in-Law, our middle daughter, made that for our oldest daughter.
Shawn:
Yeah, it cracks me reminds of Clayton, one of our other staff members here for his dad, he pretty much always gets him some drinks, like energy drinks or something like that. And the assorted roasted nuts. So it’s not very expensive, but it’s one of those where he loves it. But he’s the kind of guy that he’ll never run over to HEB or wherever and grab those.
Bob:
No, I’m the same way. I don’t go get all that stuff that Jenna gets me every year. But I absolutely love it and it is ingrained in my memory now. And so this is our takeaway number six is ask yourselves about the gift. Does it have to be expensive to be appreciated?
Shawn:
Which we kind of highlighted, but it doesn’t really.
Bob:
It doesn’t. No, it doesn’t. Not at all. And of course, our last one for today, number seven definitely is the most important one, isn’t it?
Shawn:
Remember the real reason for Christmas this year, not the American/ westernized version based on consumerism, debt, materialism, but it’s about Jesus.
Bob:
That’s right.
Shawn:
That’s what it ultimately comes down to.
Bob:
Which I think would be great just to end this on a couple of scriptures today.
Shawn:
You want to do the first one?
Bob:
You read from Matthew first chapter in Matthew 1:18-22. Okay.
Shawn:
“This is how the birth of Jesus the Messiah came about. His mother, Mary was pledged to be married to Joseph, but before they came together, she was found to be pregnant through the Holy Spirit. Because Joseph, her husband, was faithful to the law and yet did not want to expose her to public disgrace, he had in mind to divorce her quietly. But after he’d considered this, an angel of the Lord appeared to him in a dream and said, Joseph, son of David, do not be afraid to take Mary home as your wife because what is conceived in her is from the Holy Spirit. She will give birth to a son and you are to give him the name Jesus, because he’ll save his people from their sins. All of this took place to fulfill what God had said through the prophet. The virgin will conceive and give birth to a son and they will call him Emmanuel, which means God with us.”
Bob:
And I took verses 1-5 from John 1, and verse 14. Okay, so verse one through five, “In the beginning was the Word and the Word was with God, and the Word was God. He was with God in the beginning. Through him all things were made. Without him, nothing was made that has been made. In Him was life, and that life was the light of all mankind. That light shines in the darkness and the darkness has not overcome it.” Verse 14, “The Word became flesh.” This is through Jesus, “And made his dwelling among us. We have seen His glory, the glory of His one and only son who came from the Father full of grace and truth.” Amen. We hope you have a Merry Christmas based on what God did for us in sending his son and that you also have some fun times. Giving gifts.
Shawn:
Yep. Well, God bless and again, thank you so much for joining us. Bye-Bye.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 182 – 2023 Year End Tax Strategies2023 Year End Tax StrategiesWe’ve got some great tips for helping to lower your 2023 taxes.
More episodes >>
It’s time to discuss strategies for 2023 year-end tax planning! Want to lower your 2023 taxes with strategies like charitable giving, retirement plan contributions, and medical expenses? Small moves now could save you thousands in the future.
It’s important to pay our fair share of taxes, but also equally important to not pay more taxes than necessary. By taking advantage of strategies like sales tax deductions, you may be able to lower your tax bracket. As always, it’s important to consult with a CPA or tax professional for personalized advice.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodeMARK 12:16-17They brought the coin, and he asked them, “Whose image is this? And whose inscription?” “Caesar’s,” they replied. Then Jesus said to them, “Give b ack to Caesar what is Caesar’s and to God what is God’s.” And they were amazed at him.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
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EPISODE TRANSCRIPTShawn:
Want to lower your 2023 taxes with strategies like charitable giving, retirement plan contributions, and medical expenses? Small moves now could save you thousands. Let’s get some perspective.
Bob:
Welcome to another episode of Christian Financial Perspectives. We’re so glad that you joined us. My name is Shawn Peters. I’m joined as always by my co-host and father-in-Law, Bob Barber. And today we’re going to be talking about everyone’s favorite topic, taxes. Just kidding. So these are strategies though to help you with your year end tax planning. And we’re bringing this to you in early November. So there is still time. So if you hear anything in this program today and you want to implement it, hopefully there’s still time. However, we do want to bring this with a warning. If you listen to today’s program, it could help you save thousands of dollars possibly in tax. So if you don’t like that, you might want to stop listening here.
Yeah, we’ll go watch a paid subscription service of something.
Shawn:
We’ll give everyone a second if they want to leave. Okay. Those of you who are still here, let’s get into it.
Bob:
So we’re going to get through this in about 15 minutes. So it’s worth about what, a hundred dollars per minute?
Shawn:
Yeah. Something like that.
Bob:
Yeah. Awesome. At least that much.
Shawn:
Alright. Obviously results may vary, depends on what your tax situation is.
Bob:
That’s exactly right.
Shawn:
However, let’s go ahead and start with the scripture. Mark 12:16-17, “They brought the coin and he asked them, ‘Whose image is this?'” By the way, we’re talking about Jesus here.
Bob:
Yeah, right.
Shawn:
“‘Whose image is this and whose inscription?’ ‘Caesar’s,’ they replied and then Jesus said to them, ‘Give back to Caesar what is Caesar’s and to Godwhat is God’s.’ And they were amazed at him.” I’ve always loved this verse. I remember my dad would always say, you give to Caesar what is Caesar’s, but the part that I guess Jesus left off or implied was, “And not a penny more.”
Bob:
Exactly.
Shawn:
So that’s really what this is about is it’s talking about legal tax strategies because yes, you need to pay taxes that are owed, but that doesn’t mean you need to pay any more than you have to. That’s the goal here.
Bob:
And believe it or not, I’ve heard Ron Blue say this, don’t complain about paying taxes, that’s God’s provision. And you can always pay less. Just make less.
Shawn:
Just make less. Exactly.
Bob:
And please be honest about your taxes. Don’t try to hide income. It’s not a good idea. And I’ve heard people say, well, you need to pay me in cash. Well why? Well, so I don’t have to report it. Well, that’s wrong. I don’t care how you look at it. That’s wrong. You need to report it.
Shawn:
That’s right. So before we get started on the year end tax strategies for 2023, we encourage you to run any of the things that we’ve talked about. We make sure run them by your CPA or other tax professional. These strategies are very individualized to the person using them. So they may or may not apply. And we are not tax professionals. So we’re doing this in good faith to try to help point you in the right direction. So with all the fun legal disclaimers, I guess, out of the way.
Bob:
Yes, exactly.
Shawn:
Let’s get started.
Bob:
So I think the first thing, as we get started, is to know this number throughout all of these strategies and that is the standard deduction. And the standard deduction for 2023 for a single person is $13,850. And for a married couple filing jointly is $27,700. That’s where most of us fall. Now, if you’re single and you have a dependent at home, that goes to $20,800. The reason we are going to go over this is because you got to get over these standard deductions
Shawn:
For the itemized deductions to make any sense. If you already know, just ballpark that you’re not going to be really even close to those numbers. Don’t waste your time doing the itemized deductions.
Bob:
But we’re going to tell you how those itemized deductions can add up to more than the standard deductions so that you do have some tax strategies here and take some money off of those taxes. Okay.
Shawn:
Now the one exception to that standard deduction is sometimes there may be a qualifying disaster in your area like hurricane or wildfire. So again, talk with your CPA or tax professional. Look into that. But these are just the standards.
Bob:
Because that could be a deduction. Exactly.
Shawn:
So once you figure out your standard deduction for your particular area, you then have a choice to claim it or use the itemized deductions if they’re, again, more than the standard deduction, but you can’t do both. So either use the standard or you itemize.
Bob:
Okay. So some things – we’re going to get into 10 of these very, very quickly. We want to point out, many of you think about your property taxes right up front. That is usually a standard deduction, but the max you can go there is $10,000. So, if you have two homes, we have a second home in Rockport, Texas, our two homes total more, the property taxes total more than $10,000, but we can only take $10,000. It’s the same way with mortgage interest, which is a really big one that most of you all think about. The maximum amount that you can take towards the mortgage, think about your loan. If you’re loan is between $750,000 and $350,000, you can only deduct the interest on that amount of money. Okay. 350k if filing separately, 750k filing jointly.
Shawn:
So if you have a really large expensive home, you may not be able to deduct all of that.
Bob:
Right.
Shawn:
Gotcha.
Bob:
Yeah, we don’t have many that fit into that category, but if you had a $900,000 mortgage, you’re only going to get to deduct the interest on $750,000 of that. Okay.
Shawn:
Alright.
Bob:
Strategy number one.
Shawn:
Strategy number one, lump together all the itemized deductions so you can get over the standard deduction limit.
Bob:
Exactly. Yep. And you want to try to do this – sometimes what this means is taking deductions that you can take and putting them into one year versus two different years.
Shawn:
So two good examples of that would be, let’s say your property taxes are around $5,000 for the year. Well, you could go ahead and pay the latest tax bill that you had as well as next year’s property taxes before the end of the year. So you at least get that 10k and then in that given tax year, you’d be able to deduct the full amount from both years. The downside of course, is the next year you’re not going to be able to deduct any of the property tax. But again, depending on your situation, it could be a good thing to do.
Bob:
So here’s your tax strategy, year end tax strategy right now. If you paid your taxes and there were around $5,000 for property taxes, if you paid that in January of this year, go ahead and pay before December 31st of this year. But then again, you won’t have the deduction for next year. But now that should total to be enough to get you up there towards that standard deduction.
Shawn:
And another one might be charitable giving. So maybe you make your giving at the end of the year, but if you can afford it from a cashflow perspective, maybe go ahead and do both years at once before the end of the year for your charitable giving. And why would you want to do either of these? Why would you want to do this or maybe do the double property taxes? Well, what if you got a bonus this year, for example, and next year you don’t know if you’re going to necessarily get that. Well that would be a great example of why you might want to go ahead and double up on some of those normal annual things is to try to help reduce those taxes.
Bob:
Tax strategy number two, this is the one, Shawn, that I see probably 90% of our audience and of our clients here not taking advantage of and I don’t know why, but they’re not maxing out their qualified retirement plans.
Shawn:
So strategy number two is max out qualified plans.
Bob:
And we’re talking about that 401K, you may have a 403B if you work for a nonprofit or a hospital, 457 or TSP plan if you work for a government agency. You can really put a lot of money away. For this year, you can put $22,000 up to $22,500 in that qualified retirement plan. From your side, this is without the match.
Shawn:
Not including the employer match.
Bob:
And if you’re over 50, you can add another $7,500 to that. So now you, you’re getting up to $30,000 if you can afford to do it.
Shawn:
If you’re 50 or older.
Bob:
Shawn, think about this. I meet people all the time. They’re putting $10,000 in their plan and they could put that $22,500, but let’s just say they put another $10,000, and in the higher tax bracket it’s like 24%. You have immediately saved $2,400 by getting this idea.
Shawn:
That’s right.
Bob:
Right now that quick. And we’re just at the second strategy.
Shawn:
Yeah.
Bob:
Okay.
Shawn:
So max out the qualified plan is basically the – and that’s good advice in general, not even just from a tax perspective, just because it allows you to put away more for the long run and do that before you even look at, oh, maybe I should add some more money to a non-qualified account to a taxable account. No, max out your 401k. Get that deduction.
Bob:
And we mentioned tax strategy number three was large year end gifts to charities.
Shawn:
That’s right.
Bob:
You need to understand here, too, it doesn’t have to be cash. It can be things like stocks or maybe a property, small lot that you have that you don’t plan on building anything on it. You’ve had it forever. It’s just growing grass on it and costing you taxes and maintenance every year keeping it mowed for the city regulations.
Shawn:
You can even donate old cars.
Bob:
I always hear the advertisement, “Cars for Kids”. I’ve sang that song in my head. I hear I’m singing that song and I’m like, get that out of my head. There’s a limit to what you can put. Most people are not going to fall into that limit, Shawn, but it’s up to 60% of your adjusted gross income and certain types of donations may be limited to 2030 or even 50% depending on the type of contribution when it comes, like the car or the property.
Shawn:
That’s right. Alright, so tax strategy number four, sales tax. Buy the new car if you need one. But there’s a $10,000 limit with property taxes.
Bob:
So it comes under the same rules. So, you have your property taxes, let’s say your property taxes for $7,000, but you’re going to go out and buy a new car and the sales tax is $3,000. You can add those together. You’re at your $10,000.
Shawn:
So, they’re not exclusive is what we’re saying.
Bob:
I’m not saying don’t go buy a new car for that reason. Please.
Shawn:
Well, it could be new to you. It could be new. We are not necessarily saying you need to buy a actual brand new car, but let’s say your property taxes are a little bit lower, maybe they’re only 3,500 so you could pay this year and next year’s. And then the car, you’re like, well we did need to get the car anyway, we’ve been saving up and thinking about it. And if the property tax on that is around $3000 or so, okay, great. Well then between the sales tax, yeah, sorry, the sales tax and the doubling up in the property tax. There you go. Now, you’re at your 10K.
Bob:
That’s your incentive now to buy before the end of the year, buy that shiny new car or that shiny new used car. Boy, this is one I see a lot of people miss out on. Okay, tax strategy number five, you’re going to see an immediate tax advantage here. Probably going to save depending on what bracket you’re in, but let’s just say 20% here, you’re going to save maybe $1,300-$1,400 right here again.
Shawn:
So the strategy number five is the health savings account. So you want to try to max out those because it’s going to help you reduce the taxes. But also that means there’s more money that you can actually use for yourself and your family.
Bob:
And you can put $3,850 in there if you’re an individual, $7,750 if you’re family. Alright. Plus if you’re above 55 you can add another thousand to that. So Shawn, all of a sudden now you’re at $8,750, you’re at that 20% bracket. You realize for some people we’ve already saved them $4,000 or $5,000 from this first 10 or 12 minutes.
Shawn:
And I accept tips in cash or check.
Bob:
We’re going to have to zip through these to get through the rest of these. So year end tax strategy number six is medical procedures. Now this is limited to 7.5% of your income, but if you’re going to get a medical procedure anyway and maybe possibly do that before the end of the year, but let’s say you make a hundred thousand, it’s got to go over $7,500 to cost you and normally you’re going to hit your deductible.
Shawn:
That’s elective or mandatory. Just if there’s been something that you’ve been needing or wanting to get done. Well there’s an option. I always say spend the money on yourself or your family or charity if you can do that instead of giving the government more money.
Bob:
Now, Shawn, this next strategy number eight is when we use a lot around here, we always look at December and we say what do we need?
Shawn:
So, strategy number eight, business equipment. So if you own a business and there’s something you need with furniture, copiers, automobiles. I know my dad’s been in farming and mining for a long time and he would always tell me, well I guess we need new tires. And when you have big machines, those tires are expensive. Hey, may as well spend it on something you can use.
Bob:
And maybe you just have a small home business but you need a new computer. Go ahead and buy that. That is a business deduction. It’s considered business equipment.
Shawn:
So strategy number eight, tax loss harvesting. If you have investments that have fallen below your purchase price, use the resulting loss to offset capital gains in future or this year.
Bob:
And you say maybe you’re like, well I don’t want to sell that. Well you can buy it back in 31 days. So it’s a great idea, Shawn. I used this last year in a huge way because we had a property that we sold on a major highway that had a big gain in it. And last year when the market was down, I pretty much sold out my portfolio in the bottom of the market then bought back a light kind portfolio, but not the exact same holdings.
Shawn:
Because you can’t buy the same holdings.
Bob:
No, you can’t. I waited 31-32 days. Then I went back in and went back into those holdings.
Shawn:
Well, we did the same thing for our clients, too, in taxable accounts is we made sure to, well hey, let’s go ahead and do some tax loss harvesting. And so then in future good years, if you can’t use it this year, then you’ve got some tax losses you can write off.
Bob:
It’s a big one I think a lot of people don’t think about. But a very good one.
Shawn:
Tax strategy number three is use your required minimum distributions or RMDs.
Bob:
If you’re 73 or above
Shawn:
And you have them, but use your RMDs and direct them to charity. It’s known as Qualified Charitable Distribution, QCD.
Bob:
Right. So we say do this and we emphasize this to our clients here. I think it’s a great idea. If you’re a tither, and this is Christian Financial Perspectives and you give the charities, instead of giving cash give from your IRAs/your RMDs if you’re in that stage now. If you’re above 73, I know our listeners are younger because it is YouTube and podcasts, tell your grandma and grandpa about this one. Okay. Alright. And then we’ve come down to our 10th one.
Shawn:
That’s right. Number 10, income timing. And I’ll let you cover this one.
Bob:
Okay, well this has a lot to do and I work with a lot of people that get bonuses at the end of the year and they may not get that bonus next year. They may be retiring next year. So see if you can delay getting that bonus until next year when you’re in a lower tax bracket.
Shawn:
That’s right.
Bob:
That’s the main thing.
Shawn:
And I think when you’re going to be retiring next year, that is definitely the perfect one where if you think I’m going to be working until the start of the summer next year, well ask your employer, Hey, instead of give me the Christmas bonus, can you give me that bonus in March?
Bob:
Yeah, well there you go. There’s 10 strategies. I think if we were to total these up, it’d be a lot more than the $1,500 we talked to you about. But I hope this has been very productive for you. This is about a 15 minute program today, so it’s about a hundred dollars per minute.
Shawn:
That’s right, that’s right. And obviously, all joking aside, yeah, don’t send us actually any cash tips or anything like that.
Bob:
No, we don’t want that.
Shawn:
Too many compliance issues. But you can comment, like this video, share it with your friends, subscribe, all those would be much appreciated. So thank you. And as always, God bless you.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 181 – 10 Ways To Help Overcome Inflation10 Ways To Help Overcome InflationCheck out these 10 ways to help lower your bills to help combat inflation.
More episodes >>
Massive inflation is eating budgets alive, but with some wise choices like shopping thrift stores, fixing items ourselves and avoiding impulse buys, there are ways to overcome it. Bob and Shawn emphasize the importance of making wise choices, such as shopping at thrift stores, fixing items yourself, and avoiding impulse buys.
Both hosts provide personal anecdotes and examples to support their points. Overall, this episode is highly aimed to help listeners save money and assist in navigating the challenges of inflation.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodePROVERBS 21:20 NLTThe wise have wealth and luxury, but fools spend whatever they get.
PROVERBS 21:20 NASBThere is precious treasure and oil in the home of the wise, But a foolish person swallows it up.
PROVERBS 21:20 MSGValuables are safe in a wise person’s home; fools put it all out for yard sales.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTShawn:
Massive inflation is eating our budgets alive, but with some wise choices like shopping, thrift stores, fixing items ourselves, and avoiding impulse buys, we can overcome it. Let’s get some perspective.
Welcome to another episode of Christian Financial Perspectives. My name’s Shawn Peters, and this is my co-host, Bob Barber. Today we’re going to be covering 10 ways to overcome inflation. We’re not going to get really into any details on all the myriad of reasons as to why inflation has been super high, because I’m sure you’ve already seen tons of videos on that and news articles and whatever else is going on. So we figured let’s focus on ways that we can help people overcome inflation.
Bob:
Shawn, there’s not a day that goes by that I don’t talk to somebody that they’re like, I cannot believe what it’s costing me at the grocery store. And you can’t walk out of the grocery store today without just one or two sacks, and it’s going to be a hundred dollars.
Shawn:
Oh, I know.
Bob:
It’s crazy, isn’t it?
Shawn:
Well, and I just saw a video, I think it was yesterday, that someone had actually, they had recorded from a year or so ago a bunch of different things that they would buy at Costco and they were showing what the prices are now. They’re like, yeah, inflation is way worse even at Costco. It’s way worse than some people even think.
Bob:
And it’s just eating away at a family’s budget and it’s eating away at savings as well. So I’m hoping today it’s going to save you hundreds of dollars. So I will tell you this, in the next 15 minutes, hopefully it’ll be worth a couple hundred or a couple thousand dollars to you over the next year.
Shawn:
And there’s no sales pitch or anything on this. We’re not going to be talking about investment management or anything else that we actually do. This is purely educational. So if you do enjoy this video, we’d love for you to hit that like button, maybe comment if there are any other topics like this that you might want us to help you out with.
Bob:
So Shawn, before we start today, I took the scripture from Proverbs 21:20, but it’s kind of a harsh scripture. It’s kind of hard.
Shawn:
Blunt, I believe is what you’re looking for.
Bob:
And so I took three different versions. I want to read these three different versions and then we can talk about a little bit before we start. Alright, so the first one is the New Living Translation version, “The wise have wealth and luxury, but fools spend whatever they get.” It’s pretty blunt, isn’t
Shawn:
So let’s try the New American Standard Bible version, “There is precious treasure and oil in the home of the wise, but a foolish person swallows it up.”
Bob:
It’s pretty blunt too, isn’t it? Yeah.
Shawn:
And then The Message.
Bob:
Go ahead.
Shawn:
Which I always like reading something like NASB or King James or something that’s more of a literal direct translation. And The Message is always nice to get almost more of the gist of what the verse was talking about. So here’s The Message, “Valuables are safe in a wise person’s home. Fools put it out for yard sales.”
Bob:
And what’s so funny, as we talk about some of the inflation data, it says fools put it out for yard sales. I thought about that because so many times what does the old saying, “One man’s junk is another man’s treasure.” Okay? And so many times we throw away things that are still useful, but the color’s not right.
Shawn:
We’ll get into that. Don’t jump ahead next too much, Bob.
Bob:
Exactly. Alright.
Shawn:
So here we go. 10 ways to help you overcome inflation.
Bob:
First one has Bob Barber all over it.
Shawn:
Oh this? Yeah. Anyone that knows this guy.
Bob:
Just tell everybody.
Shawn:
Bob Barber. Yeah, this is Bob Barber’s. 1) Fix it yourself when it breaks. If you’re watching this on YouTube, soon as we’re done, you can pretty much look up almost anything. I mean, fixing the toilet bowl, installing fixtures, screens.
Bob:
A couple weeks ago, Shawn, so a couple weeks ago when Jenna, your wife, our daughter, our oldest daughter by the way, when she came down to our home in Rockport to visit before she left, she said, there’s a leak in the bathroom. And I said, what is it? So I went in and it was where the toilet, where the water meets the toilet bowl itself. I’ve never fixed this before and I flush it and a little bit of water would come out on the side.
Shawn:
Doesn’t seem right.
Bob:
It didn’t. And I’m like, oh my gosh. Drained it. I had to take the whole assembly off.
Shawn:
Oh wow.
Bob:
And it had been sitting on top of it and there was a plate and it got all rusty and I replaced that plate. Anyways.
Shawn:
Basically the seal wasn’t good anymore.
Bob:
The total cost for parts was $25.
Shawn:
Wow.
Bob:
Okay.
Shawn:
How much did you pay yourself for labor?
Bob:
Nothing. Okay. But I talked with some plumbers about it and it was going to be $250 to $400 to fix it.
Shawn:
Wow.
Bob:
Because it was a lot to it. It was taking it all apart, taking those parts off. It was three different parts I had to put in.
Shawn:
Well, they’re making money on the parts and they’re making money on the labor. That’s how it goes.
Bob:
Well, just to show up, they’re going to charge you a couple hundred dollars.
Shawn:
Alright, so fix it yourself.
Bob:
I had no idea how to fix it, but I went to YouTube and I figured it out. I went on some websites, found the parts, and ordered them. That’s an example right there. Very good example of when these inflationary times of saving a couple hundred dollars.
Shawn:
And I can say from personal experience, Bob actually got me my last Christmas, he got me a very useful Christmas gift. Apologies, I cannot remember the name of the book, but it was a book with a, what do you call it? Laminated like sheet. And it basically gives you all these different kinds of maintenance and things to look for if you’re a homeowner or technically if you’re renting as well. But it’s all these things to be aware of. And then the book is just detailed with all kinds of things from electrical and plumbing and HVAC, I mean just everything. And it’s awesome because I can reference that book even if the Internet’s not working, I can reference that book to fix something around the house.
Bob:
Anything.
Shawn:
It’s been great for this last year.
Bob:
Anything today. The only thing I do say, there’s one thing, do not fix yourself. You’re always hearing me say this, if the roof gets a leak in it.
Shawn:
Yeah, don’t fix it.
Bob:
Don’t try that one because your hospital bill at the emergency room is going to be much higher than what you would pay somebody to come fix it, plus you’re hurt then.
Shawn:
Alright, let’s move on. Number one, fix it yourself unless it’s the roof, otherwise you can try it maybe on your own.
Bob:
Okay, here’s another Bob Barber one, right?
Shawn:
Yep. 2) Install an antenna and drop the monthly subscription. Now Bob and I had a little bit of a disagreement, if you will, on this one. He said drop the monthly subscription. I’m like, what? I don’t have cable. I have never had cable in my adult life. For me, Netflix was the only streaming service when Jenna and I started subscribing.
Bob:
But Shawn, the streaming services like FUBO or YouTube TV, they say cut the cable, but still it’s $79, a $80 a month. So what I did was about a month, a month and a half ago, I just got tired of paying it. I’m like, this is a thousand dollars a year I’m paying to watch tv, so I’m going to get a picture. We need to show this picture of this antenna I got. It’s about this big and it looks like something from Star Wars
Shawn:
What was it like? It was like 50 bucks or something?
Bob:
It was $50.
Shawn:
Yeah, 50 bucks.
Bob:
So, I put it up, hit the scan, come up with 90 channels.
Shawn:
For free and their HD.
Bob:
The clarity is unbelievable. I called a friend that does this for a living. He goes, yeah, your clarity is going to be better. I’m like, really? Through streaming? He said, absolutely. And I noticed all of the stations that I liked that I’ve been paying for came up on the antenna tv. So now I’m going to be saving a thousand dollars a year. A year!
Shawn:
Yeah. On a $50 investment. I think that’s pretty good.
Bob:
Yeah, I do too. I think it’s a real good.
Shawn:
So if you currently have cable, might want to look into that. 3) Eat out less and make coffee at home.
Bob:
My wife’s the one that said make coffee at home because she loves, she’s got all the different kinds of syrups and she does the pour over and all that. But man, you could save a lot of money there.
Shawn:
That’s right. Pack a lunch for work, go on picnics instead of eating out if it’s a nice day and it’s a lot of fun. The other thing too, if you don’t want to make your coffee at home, you can also get, for at least for us, if you’re in the HEB area of the country, you can grab the HEB cold brew concentrate. I like the cold brew stuff, and it’s very inexpensive. I mean I think it’s like 25 cents maybe for a cup is what it comes out to. It’s real cheap.
Bob:
I watch here in our town, we have a local coffee provider and the line is just always huge of cars going through and I’m thinking they’re paying $4 a cup
Shawn:
Anywhere from $4-6, something really…well, depending on what kind of drink they get.
Bob:
I haven’t bought it in so long.
Shawn:
Well, every time I drive by, I see $5 there, $5 there, $5 there, $5 there.
Bob:
You could save $3 or $4 a day right there. So that’s over a year. That’s a thousand dollars. We’re talking about having to overcome inflation. That’s definitely one way to do it.
Shawn:
And it’s okay. You know what? Every once in a while, if you want to go through that coffee drive through, that’s fine, but make a habit of preparing ahead of time because if you don’t prepare ahead of time, you’re really going to eat into that and inflation’s going to eat you up.
Bob:
Yeah.
Shawn:
Alright, 4) Buy gently used – garage sales, thrift shops, local Craigslist, Facebook marketplace is another one. A lot of those things you can find all kinds of great stuff.
Bob:
Our middle daughter Jaeci just moved back to New Braunfels, and they sold a lot of the furniture that they had out in California before they moved back. She needed a big dresser. And I found one at a thrift shop a couple weeks ago. I found it for $40. I mean this didn’t have a scratch on it. It looked perfect.
Shawn:
It was solid wood, too.
Bob:
It was solid.
Shawn:
It was easily a 300 plus dollar piece of furniture.
Bob:
But it was just gently used. Somebody had taken really good care of it. But that’s an example, again, in these inflationary times…
Shawn:
Estate sales, also. Those are sometimes a little bit nicer because everything must go.
Bob:
By the way, we have our home in Rockport. There’s a lot of estate sales going on down there because that’s a lot of retired folks down there.
Shawn:
Alright, 5) Staycations, not vacations. Instead of the hotel or AirBnB, getting those plane tickets, having to Uber around once you get there, stay home, but still take off work. So this doesn’t just mean like, oh, you’re going to work from home or something like No, no, no. Still take off work.
Bob:
Take a vacation.
Shawn:
But maybe go to a local state or national park that’s within a hundred miles. It’s not going to cost much for gas. You could visit local museums, go hiking, bike riding, fishing – if you like fishing or even volunteer for a charity.
Bob:
Yeah, there’s so many things that you can do and I’ve heard a lot of people do this and they really have a good time.
Shawn:
Jenna and I do this most of the time now that we have kids. We finally got a used but very good price, a little travel trailer we can pull around. We needed somewhere for the kids to sleep in climate control.
Bob:
So, you let somebody else pay all that depreciation.
Shawn:
Exactly, yeah. We bought a three-year used one and yeah, we saved almost 50% off of it if we had bought it new.
Bob:
Alright, let’s go to number six. 6) Compare prices online before buying anything. Let your fingers and your keyboard do the walking for you, and you’ll save on gas. You’ll save on, possibly, if you get hungry while you’re out, you’re not going to have to eat out then. You can save so much by doing that. And we’re going to, by the way, it’s either next week or the following week. Couple of weeks from now, we’re going to do an entire session on buying a car online.
Shawn:
That’s right. Okay.
Bob:
Okay.
Shawn:
Yeah. On the compare prices online, A good example of that one, I know Clayton and I from our office, there’s a particular type of energy drink, which I’m not going to mention because then it almost sounds like it’s paid promotion. But at the local gas station, if you forgot to plan ahead like we were talking about, it’s about twice the cost even with their “buy two, get one free”, it’s about twice the cost as if you get it from the HEB or the grocery store. So again, compare online, don’t do the impulse purchases and definitely don’t make it a habit at least. But that also goes into our number seven, which is avoid impulse buying. So think logically and wait at least a week before buying anything unnecessary.
Bob:
And I got to say this one, keep emotions out of buying. Okay. You cannot let emotions get into buying decisions and just wait a week and see if you still want it. But do that research.
Shawn:
One thing that you can use that is free is there’s the Honey browser extension that you can use. So if you’re on Amazon and Walmart and there’s a whole bunch of places that it integrates with, if you see something that you’re considering, this is part of number six compared to prices online. But also, don’t do the impulse buy. Well look at the price history. Great example – Jenna and I, so I used Honey to, you can use it to track something.
Bob:
It’s called Honey?
Shawn:
It’s called Honey. I’ll show you later. We’ll put it in the description as well. But again, not sponsored, it’s free, but with honey you can track things that you are considering purchasing and you can see the price history sometimes back as far as I think like 180 days or more. So Jenna and I needed to buy a new trailer hitch so we can actually pull the RV, and it had gone up since we’d been looking at it. We’re finally, okay, we’re ready to actually purchase it. This is for sure the right one, it’d gone up $60. I’m like, oh my gosh, I don’t want to buy it. So I put it on the drop list and after about a week and a half or so, it had already dropped back down and actually had dropped back down even further below then what I had seen it from before the price went up. So then I ended up saving $70 on if I had just bought it right then when I was ready.
Bob:
Wow. Wow. Rachael bought a vacuum cleaner recently and she said she’d been looking at it for a year. She said it was at the lowest cost she’d seen in a year.
Shawn:
Yep.
Bob:
Okay. Alright.
Shawn:
8) Avoid the use of credit cards. Bob, I’ll let you cover this one. You’re very passionate about this one.
Bob:
I am very passionate about this, but studies have shown over and over, even if you’re paying it off at the end of every single month that you spend more when you use a credit card because the credit card is not like…
Shawn:
How much more do you spend on average, Bob?
Bob:
15-20%.
Shawn:
Wow. That’s more than inflation’s been.
Bob:
Yeah, much, much more.
Shawn:
But that’s if you pay it off. Even if you pay it off, you’re still spending more. But then if you’re not paying it off, I mean the amount of interest cost you’re adding on top of that is just astronomical.
Bob:
You’re buying it already and now you’re adding the interest on top of that. Now you’re really inflating the price.
Shawn:
Going to be adding 25%.
Bob:
So we’re going to show you a little chart. I got this off of Dave Ramsey’s site. I really like Dave Ramsey. He’s taught me so much and I know he learned a lot from Larry Burkett who I used to listen to years and years ago. But this chart you can see where when you’re using a debit card, you’re using your own money, and it’s real time. It’s coming down.
Shawn:
It’s coming out of your bank account.
Bob:
It’s coming right out of your bank account.
Shawn:
If your money’s not in the bank account, you can’t use it.
Bob:
But when you’re using a credit card, it’s not going to tell you when you’ve spent too much.
Shawn:
That’s right.
Bob:
They want you to spend more because they’re making their percent of it and your debit account’s not going to charge you interest or a credit card budget.
Shawn:
If you don’t pay that full balance.
Bob:
But you still get the same fraud protection. You can still use it for travel.
Shawn:
You can still use it online, you can still swipe it. You don’t have to carry a bunch of cash with you.
Bob:
Alright, number nine.
Shawn:
9) You don’t have to buy another one if it’s not broken.
Bob:
Contrary to popular belief.
Shawn:
If it ain’t broke, don’t fix it.
Bob:
That’s exactly right.
Shawn:
Or in this case, if it ain’t broke, don’t replace it.
Bob:
And just because the color’s off a little bit or the fixture might be outdated, it’s got this certain look to it, but now they’re using this other look because you saw it on HGTV, and you think I have to update it.
Shawn:
I have a great example on this one for you, Bob.
Bob:
Go ahead.
Shawn:
Jenna and I were given, I think it’s a 42, it’s a 42 inch Samsung TV and it’s flat screen, not as flat or skinny as the new ones, but it was a flat screen and we had that from the time we got married till, I dunno, about eight, nine years later, easy. And we were starting to have some issues with the screen. Well it was something I could not fix at least at the time, but I looked it up. There’s a local TV repair shop. I took it down there, cost 30 bucks, maybe 40 bucks, in and out, including labor and we still have that TV. We moved it to a different room. We since then got something, again, used and it was very inexpensive to use as our main TV. We still have it.
Bob:
I’m a big believer in big screen TVs. You know why? Because you know me, I haven’t been to the movie theater in 10 years.
Shawn:
Yeah, just have one at home.
Bob:
And so I just wait. That’s another way to save on inflation is wait for the movie to come out. There’s so many coming out every week. Just don’t look at what movies are coming out and you’ll get to watch it. One of my favorites in the last year has been “Top Gun”. It came out and I wanted to see that. I waited four or five months, it came out and yeah, I spent $5, we rented it for $5.
Shawn:
And the whole group can watch it for $5.
Bob:
What would it have cost us if we’d gone into the theater and watched that? Plus the popcorn and coke?
Shawn:
At least $5 or $6 per person if you go on the Tuesday night when it’s cheaper, but most days I think, what is it now? $8 to $10 on the matinee side.
Bob:
Shawn, if I go, I’m going to smell the good popcorn.
Shawn:
Well, you’re going to do that, too.
Bob:
So there’s another, so I’m spending $20 or $25 just to go the movie. Now I understand it’s entertainment, but still, we’re talking about inflation.
Shawn:
Don’t replace. Yeah, let’s not get on the movie industry. So, if it’s not broke, don’t buy another one. And number 10) Think energy efficiency.
Bob:
Last one.
Shawn:
To lower your utility bills, look for air gaps in your home and apply new weather stripping or insulation. Not expensive to get those items. You can install screens for windows so that way you don’t let the bugs in, but you can it if it’s a nice day, like in the fall and spring and shut off the air conditioner altogether during that time.
Bob:
We did this with our home in Rockport recently, as you know, this is an older home that we bought. They had all the screens sitting in the garage, and by the way, a lot of ’em had got rusted. But I pulled the screen off, I repainted it, you know me, and got some new screen from Walmart and fixed ’em all. Our average usage for kilowatt hours has gone down by about 75% right now because it’s such a nice time of year.
Shawn:
It’s a nice time of year.
Bob:
Right. So when we’re down there, we just open all the windows and I’m amazed, Shawn, when Rachael and I do our walks daily, how many people, they don’t open their windows during this nice time of the year and how much you could save on utility costs. There you go. That’s 10 ways. And I believe if you…
Shawn:
And only six rabbit trails.
Bob:
But if you will follow these ways and really follow this, it will help you with inflation. You’re going to save hundreds if not thousands of dollars over the next year.
Shawn:
That’s right. That’s right. Well, God bless and thank you for joining us. Hope you enjoyed it.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 180 – 6 Ways Financial Advisors Are Paid6 Ways Financial Advisors Are PaidCheck out the 6 different ways that your financial advisor could be paid.
More episodes >>
Ever wondered how financial advisors really get paid? Join Christian Financial Advisors as Bob and Shawn discuss the six types of payment and the potential conflicts of each. They emphasize the importance of transparency and encourage clients to ask their advisors about their payment structure.
Just a couple of the ways financial advisors get paid include hourly fees and salaried advisors. They also highlight the potential conflicts of interest that can arise when advisors are motivated by large upfront commissions.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodePHILIPPIANS 2:3-4Do nothing out of selfish ambition or vain conceit. Rather, in humility va lue others above yourselves, not looking to your own interests but each of you to the interests of the others.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTShawn:
Ever wondered how financial advisors really get paid? Join us today as we discuss the six types and the potential conflicts of each. Let’s get some perspective. Welcome to another episode of Christian Financial Perspectives.
My name is Shawn Peters and I’m joined as always by my co-host and father-in-law, Bob Barber. And today we have what I think will be a really fun episode. We’re going to be talking about these six ways that financial advisors are paid because believe it or not, there’s more than one.
Bob:
Yeah, that’s right.
Shawn:
So Bob, what made you want to do this episode today?
Bob:
I think because of mass confusion, Shawn, that’s why. People just don’t understand how advisors are paid. They don’t understand it can be six different ways. I know when somebody hears that, they’re thinking, you mean my advisor’s getting paid six different ways? No, your advisor’s probably getting paid one or two of these ways.
Shawn:
Not six all at once.
Bob:
Right, exactly. But these are the ways in which financial advisors are paid and they got to make a living, right? And so, I think it’s very good to be transparent about this and just be upfront. We have nothing to hide when it comes to how we’re paid.
Shawn:
And what we get paid is right there on our website. So we’re literally not hiding it. It’s publicly available.
Bob:
It is. It’s right there. Okay. So I came up with these six, and the first way was financial advisors are paid by the hour, like a fee, like you would pay a CPA.
Shawn:
Yeah, exactly. CPA ,attorney, something like that where it’s like, well, I’m probably going to need about three hours of work on that and this is my rate.
Bob:
And you’ll either pay the financial advisor directly or you’ll make the check to their company. Well, I’d say check, electronic check.
Shawn:
However you want, just depending on how they’re set up.
Bob:
But this is very upfront, very easy. Most of your financial advisors, depending on if they’re a CFP or not or their experience will do financial advice, do some financial planning for you. Probably starting at about the $150, $200 an hour all the way up to $400/500 per hour
Shawn:
$400 or $500. That’s right. So for our firm, as an example, this is one of the two ways that we get paid. And typically for us, obviously we don’t do a whole lot of business by the hour, but we have people that come to us sometimes and they don’t necessarily have a lot of money or they don’t have money they want us to manage it for them, but they want to make sure, hey, are we actually on the right path? And so maybe they do a couple hours of some one-on-one financial planning with one of our advisors and just kind of make sure they’re on the right path. Or we have maybe an existing client that we offer different levels of financial planning and the number of hours depending on assets under management with us. And maybe it’s someone who just needs extra time or extra hours that aren’t included already. So there’s just a couple of different ways that people might do that with us. And some people work only that way. Some advisors just work by the hour. They don’t do any kind of asset management or anything else.
Bob:
And Shawn, today with technology, it’s so efficient that I can do a tremendous amount of planning in just an hour to an hour and a half. It’s amazing. And we do this online and we have some past podcasts you could go back and listen to that. I don’t remember the exact titles of them, but we did one.
Shawn:
Well, this is only episode 180.
Bob:
Yeah.
Shawn:
Shame on you, Bob, for not remembering every single episode.
Bob:
It was one that we called, I think, interactive financial planning.
Shawn:
Yeah.
Bob:
Yeah, that’s right. So the second way that advisors are paid, financial advisors, and this is how we work around here, is through a ongoing monthly or quarterly asset fee for actively managing investment portfolios.
Shawn:
Right. So that is just a percentage of the assets under management that is billed, like you said, either monthly year or quarterly. For us, we bill quarterly. So whatever that annual fee is divided by four.
Bob:
Well, on our website we get paid, we say 1%. So it’s really 0.25% per quarter, which means if you wanted us to manage a $100,000, it’s $250 a quarter. That’s simple.
Shawn:
That’s it.
Bob:
And the thing about it also when a fee-based advisor is managing your money and it’s $250 for that quarter, there’s no surrender penalties or withdrawal penalties. So if you decide after just two weeks, I don’t want to do this anymore, you’ll be refunded part of that $250.
Shawn:
Depending on the advisor. So our firm, some firms bill in advance, which is what we do, we bill in advance and some bill in arrears, which is I guess a fancy way of saying in reverse, looking back. And so for us, since we bill in advance at the beginning of the quarter, in the case that you just said, Bob, if you were working with us and two weeks later you just said, this isn’t working out for me, for whatever reason, no hard feelings, we’ll pray for you. We’ll say best of luck to you. But we do a prorated to see, okay, well the two weeks is what percentage remaining of the quarter that we just billed for. And then those fees are refunded back.
Bob:
That’s correct.
Shawn:
Like you said, no surrender penalty. And we really like this in particular, which is part of why we work this way because if someone has been with us for five years, it wasn’t because they had to. They chose to stay over a five-year period, they weren’t locked in.
Bob:
I always say it’s like paying your tourist guide along the way instead of paying them all up front. You’re paying them along the way. He’s guiding you up the mountains.
Shawn:
Exactly.
Bob:
Okay. Now the third way is kind of the old fashioned way. And that is a upfront commission paid to a financial advisor from an annuity company, the old mutual funds that used to have a sales load to them or an alternative investment like a real estate investment trust paid by the company to the advisor for placing the client’s money in that product.
Shawn:
There’s different ways, obviously depending on the type of product, but typically the most common would be, for example, if you’re working with someone that is affiliated with a broker dealer, so they’re a registered representative, still a type of financial advisor, but if they put you in an annuity, let’s say it’s $100,000 you can invest in the annuity. They might get 5%, 10%, somewhere in between there, but let’s just say 5%. Well, they’re going to get that $5,000 commission upfront. And then typically the way the company protects themselves from you leaving early is there’s going to be a five year surrender penalty or surrender period where if you take your money out a year later, you’re only going to get the growth minus 4% of the original. So that original, what is that, $96,000. You’ll get $96,000 back of the original principal.
Bob:
If it was commission. That’s right.
Shawn:
Exactly.
Bob:
Right.
Shawn:
And then if there’s any growth, but that’s how they protect themselves because they don’t want to pay an advisor a 5% commission and then you take all your money out a year later and they’re left holding the bag.
Bob:
That’s right. And it usually goes down a little bit each year for four or five years.
Shawn:
Exactly. Well just to give you an example of a year later on a 5% commission.
Bob:
We’re going to go over some of those examples here later as well. Okay. So the fourth way out of our six ways is ongoing monthly, quarterly, or annual trail commissions. This is kind of like the ongoing quarterly asset management fee, but with some, it’s called a trail commission. And that’s usually going to be around 0.25% to 1% a year.
Shawn:
And a really common one for that one is if the advisor you’re working with places you in, say a C-class mutual fund, then those typically, the way they’re paid is instead of a upfront 5% commission, maybe it’s 1% per year. And again, that’s paid by the mutual fund company on an ongoing basis as part of the expense ratio.
Bob:
The client does not pay that. The mutual fund company does, but in a way the client does because the fee’s built in to the product. A lot of your annuities also have this same thing. And then we come across the fifth way. And the fifth way is what I refer to as a hybrid financial advisor. It’s a fee-based advisor and a commission-based advisor built into one. Now how does that work? Well, there may be a program like asset management that’s a fee-based program. And then maybe the advisor does sell annuities because they’re licensed to, or he sells life insurance and that’s commission based. So he’s getting the fee based and the commission.
Shawn:
And a common example of that would be an advisor who maybe they had been working only with a broker dealer and then maybe they decided to open up their own RIA, like our firm is. And they were doing some business under the RIA for the ongoing fee-based fee or management fee. But then they also, like you mentioned, they have some products like the annuity or insurance, something like that, that pays a commission that they run through the broker dealer. And so that’s how they’re able to operate in that hybrid environment and be both commissioned and fee-based.
Bob:
And always make sure as we’re going through this that you ask the advisor what they’re being paid. And this all should be disclosed to you do a prospectus. Alright.
Shawn:
And one thing I would suggest is don’t ask them how much are you paying them? Ask them how much are they being paid? I have heard that before.
Bob:
That’s true.
Shawn:
And actually it was just a few days ago as at the time of this recording, but I had a client call in and they were calling in on behalf of one of their kids and they had talked to someone when they asked, well, how much am I paying you? They said, oh, well you’re not paying anything. This is just part of it. But what she should have asked was, how much are you getting paid? Because it was one of those things where there was a fee built in. So technically she wasn’t going to be paying the advisor, but the advisor’s being paid by the company and the investment product that she was going into. It was like, I feel like, come on, you know what she was asking. So ask, how much are you getting paid? Don’t ask, how much am I paying you to kind of hopefully sift through that a little bit.
Bob:
Folks, you got to admit there is no free lunch. So that’s built in there somewhere. And then the last one is a salaried financial advisory. A lot of times you’ll see these kinds of advisors working for a very large company or a large mutual fund company, and they’re paid from the fees that are generated in those proprietary funds that they may manage or the trades of stocks on buy sell side. Not a commission, but just, well there is that, but it’s just a small amount.
Shawn:
It’s almost more like kind of a bonus if you will, if they hit their sales target, something like that. Because again, you’re not technically paying, in this case, you’re not paying that advisor directly because they’re on salary. Again, it’s more of, well, depending on how well the company has done and because they’re putting you in maybe funds that the company owns or runs, they’re still getting paid. Like you said, there’s no free lunch. So they’re still getting paid. It’s just a little different.
Bob:
Okay. So that’s the six ways. And I just want to share one last thing I want you to think about, and this has to do with a little bit about commissions. Often commissions are not paid upfront by client, like we mentioned, but they’re backloaded as withdrawal penalties for a certain number of years in a financial product. Example, there’s a 7% to 10% penalty for getting your money back in one year. The commission is probably around that same amount paid upfront to a financial advisor.
Shawn:
Which at 7% for our firm to make that same amount, would take about seven years.
Bob:
So here you go. So as an example, you invest $100,000, then you want your money back in one year, but you may only be able to get – an example of a 10% commission – $90,000.
Shawn:
Plus the interest or returns made.
Bob:
That’s correct. Exactly. Here’s where the potential, and it’s very tough on some advisors when they think about it, that advisor is, I could get paid $250 upfront to manage this person’s money for a fee, or I could make a $10,000 commission.
Shawn:
$250 ongoing each quarter. Yeah.
Bob:
Ongoing.
Shawn:
Versus $10,000 upfront.
Bob:
Okay, so you think about that, I get $10,000 now or $250 now. That’s where the temptation, a great temptation, can come in and it’s very tempting for a financial advisor, especially when they’re just getting started in the business. And Shawn, I thought, as we are Christian Financial Perspectives. I think a good scripture to go with this is from Philippians 2:3-4. You ready? Because you’re my reader? You go for it.
Shawn:
I like this one. “Do nothing out of selfish ambition or vain conceit, rather in humility, value others above yourselves, not looking to your own interest, but each of you to the interest of the others.”
Bob:
There you go.
Shawn:
That’s a good scripture.
Bob:
It is a good scripture and it’s a good scripture for the reason you need to look for a fiduciary, fee-based financial advisor. Look for it in that order.
Shawn:
That’s right. And as always, if you have any questions, feel free to reach out to us. You can visit our website, www.ChristianFinancialAdvisors.com. You can also call or text us during normal business hours at 830-609-6986. Or if you’re really fun and tech savvy, you can always comment on the video if you’re watching the video, and we try to respond to all those. So God bless and thank you for joining us.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 179 – Why Traders Are NOT InvestorsWhy Traders Are NOT InvestorsWe delve into the differences between a day trader and a legitimate investor.
More episodes >>
Ready to clear up a big misconception in the financial world – are traders and investors the same thing? Spoiler alert, they’re not. From Warren Buffett’s long-term growth strategies to the quick buck culture of trading, Bob and Shawn demystify these often confused terms.
Traders focus on short-term profits and are often compared to professional gamblers, while investors have a long-term perspective and aim to build wealth over time. The misuse of these terms by financial websites can lead to confusion and misconceptions about investment strategies. The need to differentiate between traders and investors in financial writing is extremely important in order to receive more accurate advice.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodePROVERBS 13:11Dishonest money dwindles away, but whoever gathers money little by little makes it grow.
MATTHEW 6:24No one can serve two masters. Either you will hate the one and love the other, or you will be devoted to the one and despise the other.
ECCLESIASTES 11:2Invest in seven ventures, yes, in eight; you do not know what disaster may come upon the land.
LUKE 14:28Suppose one of you wants to build a tower. Won’t you first sit down and estimate the cost to see if you have enough money to complete it?
HEBREWS 13:5Keep your lives free from the love of money and be content with what you have.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTShawn:
Ready to clear up a big misconception in the financial world – are traders and investors the same thing? Spoiler alert, they’re not. From Warren Buffett’s long-term growth strategies to the quick buck culture of trading, today, we’re demystifying these often confused terms. Let’s get some perspective. Welcome to another episode of Christian Financial Perspectives. We’re so glad that you’ve joined us. My name is Shawn Peters. I’m joined as always by my father-in-law and co-host, Bob Barber. Today we have a really exciting episode for you today on why traders are not investors, and if we ruffle some feathers, sorry, not sorry, but we are going to be sharing scriptures and how those apply within this. So we hope you stick around and if we help at least one person from making the mistake of getting caught up in the trading that is effectively gambling, then I think this video will have been absolutely worth producing.
Bob:
Shawn, what made me want to make this program was I’m kind of tired of reading the financial articles every day where they intermix and mix up the words between an investor and a trader.
Shawn:
That’s right. So that’s kind of where this came from is I’m sure you’ve seen in the news all the time, oh, what are investors looking at buying today? Or what are investors looking at? Yeah, exactly. So we’re going to be going over that and starting out with, first of all, what is an investor? So we have a couple different definitions, not just ones we came up with, but from arguably credible sources. So the first one, Bob, why don’t you cover that one from Investopedia.
Bob:
Investopedia says, “An investor is any person or other entity who commits capital.” I like that word, commits. “Commits capital with the expectation of receiving financial returns. Investors rely on different financial instruments to earn a rate of return and accomplish important financial objectives like building retirement savings.” Notice that building, “Funding a college education or merely accumulating additional wealth over time.” Emphasize some words in there.
Shawn:
So the second definition we have for you is from Webster’s Dictionary, “To commit money in order to earn a financial return to make use for future benefits or advantages.” So what I’m noticing here, Bob, is a little bit of common thread.
Bob:
I do, too.
Shawn:
On investors are focused on the long-term, 3 to 10 years or longer for their time horizon. And then just some additional insights for you, Bob, if you want to.
Bob:
Well, I just see they’re committed. They’re committed. It’s to building wealth. It’s not about what’s happening today, Shawn. It’s the future.
Shawn:
Exactly. We’re not talking in days, weeks, or for the most part, even months. we’re talking about in years because otherwise you’re not investing, which we’ll get into that next. So an investor uses a diversified portfolio to mitigate risks. They’re not looking for the hot stock pick of the day. That’s not investing, that’s trading. And investors often will look at companies’ fundamentals, the management team, long-term growth potential, and maybe even like we do here, you’re looking at, well, what is it they even do? Even if a company has a lot of really good fundamentals, but the product and the service that they’re offering is maybe kind of going out of style or it’s just not something that’s very dependable and maybe that’s not a good idea for the investment.
Bob:
And we throw in the mix biblically responsible investing.
Shawn:
Exactly.
Bob:
What is the company, what might they be supporting?
Shawn:
That’s right.
Bob:
We’ve talked so much about that on our other episodes that we’ve had.
Shawn:
That’s right, that’s right. So the scripture for this section, we have Proverbs 13:11, “Dishonest money dwindles away, but whoever gathers money little by little makes it grow.”
Bob:
Yeah. Not all trying to get rich quick, is it?
Shawn:
Exactly.
Bob:
Yeah, it’s little by little.
Shawn:
I love that verse. And it really focuses on the slow and steady wealth accumulation through long-term investments, not get rich quick, which again, I love how many times scripture talks about these kinds of principles. And you hear on social media, I’m not going to mention any specific names, but you will see all the time, oh, there’s this new cryptocurrency or this new investment or there’s this, “If you do this one trick, you’ll make all this money.” Everyone feels like I’m behind and I need to catch up quickly. But that’s not how you build and maintain wealth. And scripture talks about that a lot.
Bob:
The turtle wins the race.
Shawn:
That’s right. So the next section we want to cover.
Bob:
We get to the definition of what we feel an investor is. Okay.
Shawn:
So now we want to cover the definition of a trader.
Bob:
That’s right.
Shawn:
Which as we kind of allude to already is short term. Maybe it’s minutes to days or could maybe be a couple of weeks, but…
Bob:
Usually it’s not.
Shawn:
Usually short term. That’s right.
Bob:
Usually it’s just a day. And that’s why you see so many fluctuations between one hour and the next or sometimes between 15 minutes and the next you can see sometimes right before closing or right after, right at the opening, you’ll see it shoot up real quick, then you’ll see it shoot back down and then you’ll see the same thing happening in the last few minutes of the day. It’s just crazy. It’s crazy.
Shawn:
What is a trader? Well, according to Investopedia, a trader is “an individual who engages in the buying and selling of assets in any financial market either for themself or on behalf of another person or institution.”
Bob:
And their time horizon, again, is aimed for just short-term profits based strictly on market trends, news, what’s happening at the moment, not the long-term, but what’s just happening at the moment.
Shawn:
Some interesting things to consider, but for traders, 95% of day traders lose money, which I think that’s a pretty good highlight on the high risk nature of trading. And they incur or may incur, I guess we have to say, but they may incur higher transaction costs including taxes like the short-term taxes as well as commissions that can eat into the profits.
Bob:
I think it’s the taxes, that’s the main thing.
Shawn:
Yeah.
Bob:
I mean the taxes is all based on income taxes.
Shawn:
Instead of long-term capital gains.
Bob:
Capital gains. And I was mentioning to you that we know somebody that got caught up in the day trading and they were really doing good. It was in like 2021 and when the market was doing nothing, you could throw a dart and it was going to go up. But then what happened was they traded this stock over and over and over and they made a lot of money and then they got caught, I’d say with their pants down.
Shawn:
For lack of a better way to say it.
Bob:
And then it dropped and dropped and they owed $200,000 or $300,000 in income taxes. And then…
Shawn:
Because of all the trades that have been going on for years.
Bob:
And the value of the stock was not there and they couldn’t get the value out to pay the taxes. So guess what they had to do? Go borrow against their home. So it is sad to see this happen.
Shawn:
Well, long story short here is that it’s not that we don’t see traders make money. Okay? That’s not the case here.
Bob:
They’ll occasionally make money and you always hear about it when they’re making money, but you never hear about it when they’re losing.
Shawn:
The issue here is that traders, the very nature of what they’re doing, it’s not going to last. So it’s not a matter of if they lose money, it’s really a matter of when they lose money. I mean, you’ve been doing this over 30 years, Bob, how many day traders have you met that have been doing what they do successfully for 20 years or longer? Have you ever met one?
Bob:
Shawn, I’ve never met somebody that’s been doing it for three years or longer, but I have seen between three and four years I’ve watched…
Shawn:
Maybe five, depending on when they were doing it.
Bob:
We’ve covered this with sudden wealth. I’ve watched Sudden Wealth just slowly dwindle down to nothing over that time as they’re doing the day trading. And you got to look at the motivation. What’s the motivation behind day trading? Is it just to make a quick buck? Well, yeah, it is. It really is. And I think this is where scripture plays into this too. We look at Matthew 6:24 and it says, “No one can serve two masters. Either you’ll hate the one and love the other, or you’ll be devoted to one and despised to other.” You cannot not serve both God and money. So this is really speaking into the quick prophets and just trying to make a quick buck.
Shawn:
That’s right. You cannot simultaneously aim for quick profits and long-term growth. So, Choose wisely.
Bob:
Yeah, definitely.
Shawn:
Alright. So what are the main differences between a trader and investor?
Bob:
And I think it’s important, this is important right now to see what we say about this, I want to say something in the middle here. The main difference between a trader and investor, when you’re reading anything on the internet, this is where you really got to pay attention right now, because there’s a big difference between a trader and investor. We’ve gone over what an investor is and a trader, but what are the main differences.
Shawn:
So the first and foremost is the duration for which the person holds the asset or the time period. So, is it being held for a day, a few days? Is it something that’s being held for months or years. That would give you a big indication, the longer term, on whether or not it’s a trader or an investor.
Bob:
Investors have that longer term time horizon.
Shawn:
That’s right.
Bob:
It’s going to be investors going to have a 3, 10, 15, 20 year time horizons.
Shawn:
That’s right. And traders tend to hold assets for much shorter periods of time to try to capitalize on short-term trends.
Bob:
They’re looking for those trends.
Shawn:
That’s right.
Bob:
And they’re all guessing against each other. And they’re also gambling many times on just one company or two companies. So they’re putting more of their eggs in one basket where an investor’s going to diversify a portfolio.
Shawn:
Which goes right into our scripture for this one, Bob, which is Ecclesiastes 11:2, “Invest in seven ventures. Yes, in eight, you do not know what disaster may come upon the land.” Diversification is crucial in investments to mitigate risk.
Bob:
That was the wealthiest guy in the entire globe.
Shawn:
That’s right.
Bob:
I don’t know what. We heard some kind of interpretation that he would be worth. – Solomon would be worth 7 or 8 trillion a day or something. It’s some crazy number.
Shawn:
Some crazy numbers.
Bob:
Alright.
Shawn:
The misuse of the terms trader and investor. So here’s the problem, as you alluded to in the beginning.
Bob:
This is why I made the program today.
Shawn:
Many financial websites use these two terms trader and investor interchangeably. Apparently, I think due to inexperience and lack of knowledge, I mean I guess no journalistic integrity.
Bob:
I cannot understand why they mix ’em so much together like that. And so many times I’m saying you mean to say trader here, not investor.
Shawn:
The implications of this, the misuse confuses the public and it leads to misconceptions about investment and trading strategies.
Bob:
So when you hear the word investors are doing in this and investors are doing that and you’re thinking, well, I’m an investor, I’m not doing that.
Shawn:
Or then we get the question too, Bob. So clients will ask us, well, I heard on CNBC or whoever, whatever. I mean it’s a pretty major one.
Bob:
Yeah, it is.
Shawn:
But you’ll hear on these financial sites, whether it’s articles or videos about what investors are doing. And then clients are asking us and we go, no, that’s a very short term. That’s a day trader thing.
Bob:
They should be saying trader investing, that’s not investors. Right.
Shawn:
So investors, and I think this is an easy way to hopefully remember this. Investors focus on time IN the markets, not TIMING the markets and time in the markets is a proven strategy.
Bob:
It is, yep. A trader is just concerned about quick profits without regards of the company’s long-term potential or their impact on society.
Shawn:
That’s right. And so the scripture, this is Luke 14:28, “Suppose one of you wants to build a tower, won’t you first sit down and estimate the cost to see if you have enough money to complete it?” Planning and assessing risk are essential before embarking on any financial journey.
Bob:
Absolutely.
Shawn:
Especially when it comes to your investments.
Bob:
We’re going to hark on a little bit more here.
Shawn:
I feel like I had to hold you back on this, Bob, because this is the part you wanted to get to. Traders are professional gamblers.
Bob:
They are, I mean, similar to the gambling, the majority of day traders lose money or do so eventually, if not right away.
Shawn:
Like we said earlier, you’ve seen some that have three to four years maybe in the right circumstances, maybe five years, but you don’t hear about or meet people that have been day trading consistently and profitably for 10 years. It just doesn’t happen.
Bob:
And I’ve had clients in the past, they’ve gone through all the courses, they’ve bought all the advertisements since they’ve heard and spend a lot of money on the trading programs.
Shawn:
And we won’t get too far into that Bob, but we talked about one of our other episodes on the professional doomsayers. And you have these people that are selling you this trading program that’s going to help you be profitable. Here’s my first question.
Bob:
Yeah.
Shawn:
Why are they wasting their time on this educational training program that supposedly works? Because if it actually worked half as good as they say it does, they wouldn’t be wasting their time selling it.
Bob:
They’re doing fine themselves.
Shawn:
They’re making money on tricking you into buying their nonsense, not on what they’re actually selling you.
Bob:
Because if they sell it too much and everybody starts using that program, it’ll no longer work because now the strategy is everywhere.
Shawn:
Yeah, just like gamblers, the traders, they’re not particularly concerned with the underlying value of the assets. They’re more focused on those short-term movements. And we have another scripture, Hebrews 13:5 if you want to read that one.
Bob:
“Keep your lies free from the love of money and be content with what you have.” Money’s not evil, but the love of it. And this is what day trading can do. And I like your interpretation. I’ll let you share that.
Shawn:
Yes. Money should not be the end goal. It’s just a means to achieve financial security and contribute back to society. Expanding God’s kingdom, if you’re a Christian, that’s our goal. So we have a case study, if you will.
Bob:
A case study, right.
Shawn:
I guess it’s not long enough to be a case study.
Bob:
No, it’s not.
Shawn:
Warren Buffett.
Bob:
Oh, he is definitely. He turned 93 a few weeks ago. So the old guy just keeps on going.
Shawn:
That’s right. Well, so investors look at what the company makes and its long-term growth potential or dividends. Warren Buffett is arguably the most famous moderate investor. And his long-term strategy focuses on finding excellent companies to invest in and holding them for their long run. Warren Buffett doesn’t day trade, as far as I know. Never has.
Bob:
I mean, when you listen to him and I listen to ’em a lot, they hate the thought of it.
Shawn:
And it doesn’t work.
Bob:
And they talk about how it is so bad for the markets itself as well.
Shawn:
Again, to use the gambling idea, Bob, the reason why we say day traders or traders, not investors, are gamblers is because just like with gambling, the house always wins. So you might get a lucky streak at blackjack or whatever is your game of choice, but eventually the house wins and you lost it all. And if you’re really lucky, maybe you made enough money to pay for your drinks.
Bob:
Well, I think I want to learn from the most successful investor I know in modern times, which is like you say, Warren Buffett. He’s very intelligent and also he doesn’t let any motions get involved. You always hear him injecting money in the markets when they’re way down. So he takes the emotional part out of it and he’s looking for things on sale. So the guy is smart. And I guess something’s going on there, too. At 93 years old, he’s still doing it. I think that’s amazing.
Shawn:
So we hope this clarification of the difference between an investor and a trader has helped you for the next time you see an article about “what traders are looking to invest in today”. Because as I think we’ve made clear what the writers usually mean is what traders are looking to BUY today, not invest today.
Bob:
That’s correct.
Shawn:
Using those interchangeably again. And ultimately, financial writers need to exercise caution and correctly differentiate between traders and investors to provide accurate advice. So if we happen to have someone watching or listening that works for one of those financial sites, hopefully this helped.
Bob:
I hope so. And please, if you are a writer, don’t call an investor a trader.
Shawn:
Yeah.
Bob:
Okay. And we’re here to help you invest for the long term and we’re here to help you with a Biblically responsible investment as well.
Shawn:
That’s right. Thank you. And God bless.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 178 – What God’s Word Says About Money Part 2What God’s Word Says About Money Part 2Lean in to what the Bible says about money when it comes to saving and investing, inheritance, seeking wise counsel, and faithfulness.
More episodes >>
Bob and Shawn finish the second half of their series on “What God’s Word Says About Money”. They discuss the importance of saving and investing, inheritance, seeking wise counsel, and faithfulness according to Biblical teachings.
Listeners are highly encouraged to seek wisdom from trusted advisors and to be faithful stewards of their resources, emphasizing the order and responsibility that comes with building wealth. As always, several scriptures are highlighted that emphasize the significance of these topics and provide real-life applications.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodePROVERBS 13:11Dishonest money dwindles away, but he who gathers money little by little makes it grow.
PROVERBS 21:5The plans of the diligent lead to profit as surely as haste leads to poverty.
ECCLESIASTES 11:2Give portions to seven, yes to eight, for you do not know what disaster may come upon the land.
PROVERBS 20:21An inheritance claimed too soon will not be blessed at the end.
ECCLESIASTES 7:11Wisdom, like an inheritance, is a good thing and benefits those who see the sun.
PROVERBS 15:22Plans fail for lack of counsel, but with many advisers they succeed.
PSALM 1:1Blessed is the man who does not walk in the counsel of the wicked or stand in the way of sinners or sit in the seat of mockers.
LUKE 16:10Whoever can be trusted with very little can also be trusted with much, and whoever is dishonest with very little will also be dishonest with much.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTShawn:
Ready for round two of Financial wisdom from the Bible? Last episode, we tackled honesty, debt giving, and ownership. Today we’re turning the page to saving, investing inheritance, and more. Brace yourselves. We’re diving deep again, so let’s get some perspective. Welcome to another episode of Christian Financial Perspectives. We’re so glad that you’ve joined us. My name is Shawn Peters. I’m joined as always by my co-host, Bob Barber. Today we’re going to be covering part two of a series on what God’s word says about money. There are over 1500 scriptures on stewardship and talking about money. So we think this is a really important topic to cover. And so we’ve divided this into eight total subjects. If you missed part one, links in the description should be somewhere on screen as well. Last time we covered honesty, debt, giving, and ownership. We’re going to be covering saving and investing, inheritance, seeking wise counsel, and faithfulness.
Bob:
One of the things I want to make sure that we say too, Shawn, when you talk about scriptures is that Jesus and all he spoke on, he spoke on stewardship more than heaven and hell combined according to many biblical scholars. So that’s a lot of…
Shawn:
So maybe it’s important.
Bob:
It’s very, very important. It sure is. So like you say, if you didn’t hear last week’s, please go back and listen to it. We’re giving you some really good information, but we’re only covering about 20 of the 1500 scriptures.
Shawn:
Exactly.
Bob:
Yeah. Okay.
Shawn:
So don’t worry, we’re not covering all of them.
Bob:
Alright, so let’s get started with saving and investing. Most people don’t realize that scripture speaks into this and it does and it comes. We have three scriptures that I see that go with this. Proverbs 13:11, “Dishonest money dwindles away, but he who gathers money little by little makes it grow.” Proverbs 21:15, “The plans of the diligent lead to profit is surely as haste leads to poverty.” And…
Shawn:
Ecclesiastes 11:2, “Give portions to seven, yes to eight, for you do not know what disaster may come upon the land.”
Bob:
We say that one a lot around here.
Shawn:
We do. That is definitely one of our firm life verses, if you will.
Bob:
So when I look at these scriptures, they’re talking about saving and they’re talking about investing, but they’re talking about it with wisdom. I see where these scriptures provide protection and they talk about being frugal.
Shawn:
That’s right.
Bob:
Dishonest money dwindles away, but he who gathers money little by little. It’s not get rich quick, Shawn.
Shawn:
Exactly. So that takes us into, for this particular subject, saving and investing, we have three real life application areas to cover. Saving with wisdom – so understanding the importance of diligently saving over time for financial security. We have protection – having a diversified investment strategy can protect against unforeseen financial downturns. And of course frugality – being economical in your saving and investing can lead to long-term financial stability.
Bob:
So the next subject we’re going to talk about today is inheritance. And when it comes to inheritance, we’re just going to go over two scriptures today, but there’s actually over 200 scriptures that have to do with inheritance.
Shawn:
It’s hard to pick just two.
Bob:
Yeah, it is. But I picked Proverbs 20:21 and Ecclesiastes 7:11. Proverbs 20:21 says, “An inheritance claimed too soon will not be blessed in the end.” There’s a lot of thought behind that, and Ecclesiastes 7:11 says, “Wisdom like an inheritance is a good thing and benefits those who see the sun.” So Shawn, I see that how we leave an inheritance to our children is extremely important and if we leave it without wisdom, it can hurt ’em more than it can help.
Shawn:
That’s right. That’s right. And for our real life application, how we leave inheritance to our children matters. The timing and thoughtfulness in leaving an inheritance can result in long lasting family stability and blessing. I know, Bob, from your personal experience, I know that you have your estate planning set up to where a certain percentage of the trust, everything that you have in your estate can be distributed out each year, but no more than that.
Bob:
That’s correct.
Shawn:
Specifically. So it will theoretically continue to last for multiple generations. And you even have, I believe, the church and maybe Compassion International.
Bob:
I do. And Focus on the Family is about 20% of my estate. That’s right.
Shawn:
Which is again, is a great way not just for Bob’s children, my wife being one of those, but it’s one of those things that will allow it to last without it just being completely spent and depleted by the descendants, but also that continued blessing for charities and for expanding God’s kingdom after Bob’s gone to be with the Lord. So that’s something that you could do in your own estate planning.
Bob:
Another thing else that we put in there is an idea is for the men of the family to inherit their portion each year, they have to work for that and so they basically get a matching grant for how much they worked. So it’s an incentive to work because work is a good thing.
Shawn:
Exactly. And then of course, wise inheritance.
Bob:
Yes.
Shawn:
Inheritance shouldn’t be given without wisdom because again, as we said, it could hurt the children more than it helps, it can compound the problems of the child. If your child is receiving a large inheritance, but they haven’t been able to show themselves faithful with what God has given them already, it’ll just exacerbate that problem and it basically amplifies whatever the weaknesses are.
Bob:
That’s right
Shawn:
In the child.
Bob:
Sure does.
Shawn:
So careful planning to make sure that what you’re giving to them, that what they’re inheriting is ultimately going to help them, going to bless them, not ultimately make their life worse.
Bob:
So this kind of takes us right into the next subject, doesn’t it?
Shawn:
Yep. Seeking wise counsel is our number three for today, and our first scripture on that is Proverbs 15:22, which is one of my favorites, “Plans fail for lack of counsel, but with many advisors they succeed.”
Bob:
And another one is from Psalms 1:1 and Psalms 1:1, you can look at it kind of two ways. “Blessed is the man who does not walk in the council of the wicked.” So blessed is a man that does walk in the council of wisdom, right?
Shawn:
Yeah, that’s right.
Bob:
“Or stand in the way of sinners or sit in the seat of mockers.” So it’s saying the man will be blessed if he’s not walking in the council of the wicked.
Shawn:
That’s right.
Bob:
So I look at that and I say, okay, what’s the opposite of that basically is saying the man will be blessed by walking in wisdom in God’s word. There’s a lot of real life application to this.
Shawn:
Exactly. So the first one, wise counsel over social media and Hollywood.
Bob:
Oh yeah.
Shawn:
I mean our world is just saturated with information, some of it good, much of it not. And seeking the wisdom of trusted advisors rather than just whatever’s popular on “insert social media network of your choice here” or whatever popular culture is talking about. It’s critical. And when we say multiple advisors, that could be, like our firm, Bob and I are both financial advisors, Christian financial advisors, but there’s also, there’s CPAs, there’s attorneys, there’s maybe you have a trusted older relative of some kind. Could be a parent, grandparent, but someone who has shown themselves to be trusted with what God has given to them. Those are all examples of people that you can seek wise counsel from.
Bob:
And look at the traits that are listed for an elder or a deacon in the third chapter of Timothy. We don’t have that one as one we’re sharing today, but I just thought of that.
Shawn:
It’s a very good one.
Bob:
While you’re doing it, the third chapter of Timothy is a person with a good reputation, well known in their city, not drunkenness/too much wine and alcohol, things like that. So it’s got really good virtues in there that you would want to look for in that wise council.
Shawn:
And so going into our last topic or subject for today, but it’s faithfulness. So our scripture for this one is Luke 16:10, “Whoever can be trusted with very little can also be trusted with much. And whoever is dishonest with very little will also be dishonest with much,” which goes back to, I mean, I guess like we said on multiple of these, if you’re seeking counsel or if you are receiving an inheritance, whatever the case may be, you need to be someone that can be trusted with what you have been given. Because if you can be trusted with a little, well, maybe you can be trusted with more.
Bob:
There’s order in wisdom, and there’s order in becoming wealthy as well. And that’s where I see this because it’s basically saying, okay, you handled that $5, how you handled that $5,000, how you handled that $50,000. Well maybe I can bless you with a $100,000 or $200,000 or even $500,000. You handled that well, now there’s a million. So it can increase. And it says this right here. If you can be trusted with that little bit. So you’re thinking I want to go way out there to the million or 2 million, how are you doing with the $5 or $10 in your pocket? How are you doing with credit cards?
Shawn:
And that could be more closer to home too of not just oh, that God somehow blessed you with money out of nowhere, but in your relationships maybe with your spouse, your kids, your job, maybe with your church and volunteering and that you don’t just get to be the leader all of a sudden. You don’t get to be the high income earner.
Bob:
That’s right.
Shawn:
You earn your way to that. You show that you can be trusted and faithful with what God has already put on your plate in all areas of your life.
Bob:
So I like what you wrote down here, the real life application of this, Shawn, and I know you wrote this, there is an order in becoming wealthy.
Shawn:
That’s right. Building wealth isn’t just about having resources, it’s about being faithful in managing whatever you have, large or small. Financial stability comes with time and faithful stewardship.
Bob:
So there you have it. There’s parts one and two of what God’s word says about money. Like you said, we shared about 20 and stewardship, we shared about 20 of the scriptures and last week’s, if you didn’t hear it, I would now invite you to go back and listen to that one of last week. We went over honesty, debt, giving, ownership, saving and investing, inheritance, seeking wise counsel, and faithfulness. What’s amazing, there’s so much more in God’s word, over 1500 to 2000 scriptures.
Shawn:
So hopefully this inspired you. Again, we did not share all 1500 to 2000 scriptures, but hopefully this has inspired you that we would encourage you to seek God’s word and read this for yourself. I mean, you can go to bible.com and Bible Gateway. There’s all these different places. Just look for scriptures on honesty, scripture on inheritance, scriptures on…
Bob:
We have this all on our website, Shawn.
Shawn:
We do. We have a lot of these on our website as well. We’ll have a link in the description. But again, God’s word says so much about this, so we hope this has encouraged you to seek this more, to look into this yourself. Don’t just take our word for it. Go look at God’s word. And I think that’ll wrap it up for today. If you want to get in touch with us, if you’re watching this on YouTube love for you to leave a comment. You can also contact us via phone or our website. That’s (830) 609-6986. Call or text. You can also visit www.christianfinancialadvisors.com. Thank you and God bless.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 177 – What God’s Word Says About Money Part 1What God’s Word Says About Money Part 1Delve into the Biblical financial principles of honesty, debt, giving, and ownership.
More episodes >>
Bob and Shawn get back to what Christian Financial Perspectives is really about by delving into key scripture on what the Bible says about money, finance, and stewardship. In part 1, they cover four key biblical principles related to finances: honesty, debt, giving, and ownership with scripture references and real-life applications for each principle.
The importance of honesty in business dealings and the benefits of living debt-free is emphasized, as well as the joy and significance that comes from giving and the responsibility of stewarding God’s creation. Don’t forget to check out part 2 that will be covering saving and investing, inheritance, seeking wise counsel, and faithfulness!
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodePROVERBS 12:19Truthful lips endure forever, but a lying tongue lasts only a moment.
PROVERBS 21:16A fortune made by a lying tongue is a fleeting vapor and a deadly snare.
PROVERBS 22:7The rich rule over the poor, and the borrower is servant to the lender.
PROVERBS 22:26-27Do not be a man who strikes hands in pledge or puts up security for debts; if you lack the means to pay, your very bed will be snatched from under you.
PROVERBS 11:25A generous man will prosper; he who refreshes others will himself be refreshed.
2 CORINTHIANS 9:6Remember this: Whoever sows sparingly will also reap sparingly, and whoever sows generously will also reap generously.
HAGGAI 2:8“The silver is mine and the gold is mine,” declares the LORD Almighty.
PSALM 24:1The earth is the Lord’s, and everything in it, the world, and all who live in it;
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EPISODE TRANSCRIPTShawn:
Are you navigating the choppy waters of financial decisions and wondering where true north is? Did you know that Jesus spoke more about stewardship than Heaven and Hell combined? Today we’re diving into four key Biblical principles that can set your financial compass straight. Let’s get some perspective.
My name is Shawn Peters. I’m joined as always by my father-in-law and co-host, Bob Barber. Today we’re going to be covering a really exciting topic on what God’s word says about money. We’re going to do this as a two-parter because God’s word does have a lot to say about this entire subject, and we’re going to break it down for you into eight separate subjects. Today, we’re going to cover the first four because there are over 1500 scriptures on stewardship and what the Bible says about money. And many Biblical scholars say that Jesus spoke on stewardship more than Heaven and Hell combined, which seems like it might be important then. So today our first four subjects we’re going to be covering are honesty. Number two is debt. Number three is giving, and number four is ownership. Bob, you got anything to start with us today?
Bob:
Shawn, I will tell you I get very excited when I start talking about God’s word and what it says about money because I’ve been studying it for so many years. What we’re going to do with each one of these is we’re going to say the scripture, then we’re going to have a real life application as to how this would apply.
Shawn:
First subject for today is honesty. We have Proverbs 12:19, “Truthful lips endure forever, but a lying tongue lasts only a moment.” And then our second scripture, Proverbs 21:16, “A fortune made by a lying tongue is a fleeting vapor and a deadly snare.” And just to be forewarned, we do have a lot of Proverbs. Proverbs does have a lot of really good wisdom.
Bob:
It does, and I see this speaking into a lot of protection and prosperity as well, because when you look at that, a lying tongue lasts only a moment and it’s fleeting when you’re lying. So this is the importance of honesty because when you’re honest, good things happen. A society can operate off honesty where it cannot operate if it’s a dishonest society.
Shawn:
Well, and think about that from the idea of protection. So with protection, being honest in your business dealings can offer you protection from potential legal consequences and damaged relationships because you’re not being untruthful. So, you’re not going to run into the same issues of, oh, well, you told one person one thing and then you told somebody else something different, and now you’re getting in trouble somehow for that it just…not a good idea.
Bob:
When you’re dishonest, you always have to be looking behind you.
Shawn:
You got to keep track of what did you do.
Bob:
What did you say? That’s correct.
Shawn:
And then the second one is prosperity. So transparency and honesty builds trust, which can lead in the long-term to prosperous relationships and partnerships, both personally and professionally.
Bob:
Another area that the Bible speaks into, of course, is debt. And Proverbs 22:7, it says, “The rich rule over the poor and the borrower is servant to the lender.” Now think about that. Banks, okay, banks, lending institutions, we become basically servant to them or a slave to them when they’re lending to us, especially if we over borrow.
Shawn:
The lender does not care if you are borrowing more than you really should be borrowing. If you qualified for it. Sure. They’ll lend it out to you and then they’ll snatch your home out from underneath you if you can’t pay for it. So it’s very important in this case, make sure that you are doing what you should as far as how much you’re borrowing, not what you are say approved for, because that doesn’t necessarily equal to the same number.
Bob:
No, it doesn’t. And Proverbs, this 22nd chapter is about debt. And again, so we mentioned Proverbs 22:7.
Shawn:
And then we go into Proverbs 22:26-27, “Do not be a man who strikes hands in pledge or puts up security for debts. If you lack the means to pay, your very bed will be snatched from under you.”
Bob:
It’s pretty scary.
Shawn:
Yeah. Direct to the point.
Bob:
Basically, it’s like the old saying, Shawn, pull the rug right out from under you if you don’t have the means to pay.
Shawn:
So for real life application, we have two areas, safety and tranquility. So for safety, living debt-free allows for greater financial security and less vulnerability to economic downturns.
Bob:
Yes, it does.
Shawn:
And then for tranquility, no debt means no anxiety over bills, creating a more peaceful living environment.
Bob:
I know that I sleep well knowing my bed’s not going to be snatched out from under me. Now, I know that’s metaphorically speaking, but it’s really about things being taken away from you if you’re not wise with what you do. It’s like they call the guy repossessing, repossessing a car if you’re not paying for it. There’s a lot of peace that comes and tranquility that comes with being debt-free.
Shawn:
And so now on to number three of four for today is number three, giving. The first scripture on this is Proverbs 11:25, “A generous man will prosper. He who refreshes others will himself be refreshed.” That’s a good one. And 2 Corinthians 9:6, “Remember this, whoever sows sparingly will also reap sparingly, and whoever sows generously will also reap generously.”
Bob:
I think these scriptures can apply to real life by giving provides joy, and it also provides significance. Because you’re doing something of significance when you’re getting outside of yourself, and you think about supporting the Habitat for Humanity or supporting your church or around here, we support Compassion very strong and those children. And there’s so much joy that giving brings.
Shawn:
Well, there’s a reason it’s better to give than to receive.
Bob:
Yeah.
Shawn:
And giving allows us to tap into something that God first did for us, that God sent his Son for us to be able to redeem us back to him. And so when we give, not only are we being more like God, we are giving of what he has given to us, but we’re also showing that we trust him. And there’s a lot of joy in that, in trusting, okay, God, I’m trusting you that by giving to someone else, by giving from what you’ve given to me, that you will continue to take care of me and take care of my family and our needs. So joy, the act of giving can provide emotional and spiritual joy knowing that you’ve made a positive impact on someone’s life, and of course significance, your generosity can leave a lasting impression and perhaps even inspiring others to be generous as well. That could be something where maybe in your financial planning and your estate planning that you set things up to a portion of whatever you have left in your estate would continue to give to a charity ongoing or to your church.
Bob:
And we’re going to talk about inheritance next week and what that says, that’s going to be for our number five through eight areas.
Shawn:
I guess that was Easter egg, right?
Bob:
That’s exactly right.
Shawn:
So subject number four, ownership. Haggai 2:8, “The silver is mine and the gold is mine, declares the Lord Almighty.” And Psalm 24:1, “The Earth is the Lord’s and everything in it, the world and all who live in it.” The two areas of real life application for this one – responsibility, recognizing that all you “own” is actually God’s, encourages better stewardship and responsibility. And like we said, taking care of God’s creation, it motivates you to take care of the environment and the people around you knowing that they all belong to God and are his creations as well.
Bob:
I can see how these can apply to real life, like responsibility. Responsibility with what we have, the material possessions that we have, and taking care of them. Also taking care of God’s creation. You hear bad things about, “Well, that environmentalist, he’s crazy. All he cares about is the environment. He doesn’t care about people.” Wait a second, God created. So if we love the Creator, take care of the creation.
Shawn:
We can do both. We obviously, yes, we need to take care of people. And if you ask me what’s more important, this tree or this person, I’m going to pick the person every time. But that doesn’t mean that we shouldn’t try to take care of the rest of God’s creation. He put us in charge. He left us. He put us on this earth, and that’s part of it.
Bob:
Talk about this a little bit more about the material possessions as well, because we look at our car, we look at our home, how are we taking care of them? If we believe God owns them, then we should take good care of them because he’s put us in charge of that home. He’s put us in charge of that car. And that’s why you want to keep a clean car. That’s why you want to keep a clean home. That’s why you want to keep things in order because God gave you that.
Shawn:
Tell that to a one and a half and a four and a half year old though.
Bob:
Yeah, I know.
Shawn:
They have not learned, in my household, they have not learned that yet.
Bob:
Yeah, no. Hey, I remember when we had teenagers, we just closed the door and just said, okay, we’re going to take care of the rest of the house.
Shawn:
I heard somebody say it one time, Bob, name one thing more efficient than a toddler making a mess. Go ahead. I’ll wait.
Bob:
I’m not going to. But you know, the other day when I was playing with your daughter, my granddaughter, by the way, she would take the Lego apart and I’d put it back together and she’d take it apart and I’d put it back together. So I kept trying to put it together and she would just, and then throw it just wherever.
Shawn:
Exactly.
Bob:
So there you have it. That’s the first four for today. Believe me, there’s so many. I thought about this. This series about what God’s word says about money. By the way, we could just make this an entire podcast program. We could do 1500.
Shawn:
Well, sure.
Bob:
Because there’s 1500 scriptures it has to do with. So we’re not going to do that. Okay? But next week we’re going to cover what God’s word says about saving and investing, inheritance, seeking wise counsel, and faithfulness. So you’ll want to join us for the next program as well, and it’s going to really be inspirational. We want to operate by God’s principles, Godly principles in the Bible for handling finance. And that’s what we do at Christian Financial Advisors. And if you would like us to help you align your investments and your portfolio and your financial planning with what God’s word says about money, you can give us a call at (830) 609-6986. You can text that number as well, or you can find us on the internet www.christianfinancialadvisors.com. Any last words, Shawn?
Shawn:
That’s right. Thank you so much for joining us and God bless.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 176 – 10 Ways to Sabotage Your Investment Portfolio10 Ways to Sabotage Your Investment PortfolioSteer clear of these common errors to help safeguard your investment portfolio.
More episodes >>
Avoid these common mistakes when it comes to your investments! Bob and Shawn discuss the 10 ways they often see clients sabotaging their investment portfolios. They emphasize the importance of discipline, wisdom, and seeking counsel in making investment decisions.
Whether it is a client making large frequent withdrawals or even treating their investment portfolio like a savings account, there are many ways to sabotage your investment portfolio without knowingly doing so. They stress the long-term consequences of these behaviors and the need to be good stewards of one’s finances.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodeHEBREWS 12:11For the moment all discipline seems painful rather than pleasant, but later it yields the peaceful fruit of righteousness to those who have been trained by it.
PROVERBS 1:87The fear of the Lord is the beginning of knowledge, but fools despise wisdom and instruction.
PROVERBS 21:20The wise have wealth and luxury, but fools spend whatever they get.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTShawn:
Are you unknowingly sabotaging your investments? From ignoring wisdom to making emotional choices? We’ll explore 10 pitfalls to avoid, backed by Scripture. Let’s get some perspective.
Welcome to another episode of Christian Financial Perspectives. My name is Shawn Peters and I’m joined as always by my esteemed co-host and father-in-law, Bob Barber. Whether you’re watching this online or you’re listening on one of the many podcast directories, we’re so glad that you’ve joined us. Today, we are going to be covering 10 ways people sabotage their investment portfolios. Now, if you do enjoy content like this where we cover financial topics from a Christian perspective with the goal of helping Christians glorify God in their finances, we’d love for you to hit that subscribe button. But today, this is a kind of difficult topic, and we want to be sensitive to that. We understand that the journey of investing is fraught with challenges and emotions because we are emotional creatures made in God’s image. So can’t really help that, right Bob?
Bob:
No, we can’t.
Shawn:
But today, our mission, our goal if you will, is to offer you some compassionate guidance on some typical missteps that we see people make with their investment portfolios. Keep in mind, no judgment here, just wisdom steeped in years of experience, faith, and scripture. I will say the years of experience are more heavily leaned towards the side here on Bob’s side.
Bob:
It’s the gray hair.
Shawn:
But I’ve almost gotten to 10 years. So I can almost say I have a decade of experience.
Bob:
Yes.
Shawn:
A little bit closer. But I’d like to share a scripture before we go any further. Since this is Christian Financial Perspectives, I think that’s appropriate. Hebrews 12:11, “For the moment, all discipline seems painful rather than pleasant, but later it yields the peaceful fruit of righteousness to those who have been trained by it.” Now, I think that’s a wonderful scripture when we’re talking about in investing because it is for the long term and that in the moment that discipline can seem difficult or painful or in the way of what you’re trying to do. But the reality is you need that to be successful. So hopefully if we cover some of these today and if even one of these jumps out at you, we’ll have done our job.
Bob:
And Shawn, as you know, as always, I’m coming to people. I’m coming to them from the perspective of many years. We talk about decades. I got three decades of investment experience. And it’s heartbreaking when someone calls us for the 50th time and takes a withdrawal and you’re done, your portfolio’s depleted, you’ve depleted it. And they’re like, well, I had $500,000 just two or three years ago, or I had $1,000,000 5 years ago. And we give numerous, numerous warnings and it’s hard. It’s hard. And that’s why we want to come at this with compassion.
Shawn:
That’s right. And of course we’ll get into what Bob’s referring to on the withdrawals.
Bob:
Exactly. So we’re going to cover this from the least important to the most important. So the most important is going to be at the end of the program, but I’ve seen overall, there’s 10 areas I’ve seen that people will sabotage their portfolio from lack of. So starting at number 10.
Shawn:
Sure, number 10, lacking a written investment strategy and sticking to it.
Bob:
Now, I’ve never met anybody that had a written investment strategy. We have one here, but just sticking to it, that word sticking to it is the most important thing. And again, a lot of this program is going to focus around discipline because that’s what this is about is discipline. The reason investment portfolios are sabotaged over time is because of a lack of discipline.
Shawn:
That’s right. Which manifests in numerous ways. So number 9, lack of diversification. So investing in only one or two sectors.
Bob:
And I’ve said this many times on the program where I see the main sector that people get so caught up in, they believe a hundred percent of their investments ought to go there is in real estate. Shawn, right here in New Braunfels, we have a major development that we started about six or seven years ago. When I say major, it’s going to be 5,000 homes by the time it’s done; they’re probably at about 1500 homes. Now, I’m not going to mention the name of development.
Shawn:
Because they didn’t pay us for a sponsorship.
Bob:
Well, it’s not just that because they might not.
Shawn:
I know, I’m kidding.
Bob:
But Shawn, I went on realtor.com the other day, and remember we gave the warnings about real estate. There are some homes in there that are coming up on one year being on the market that are finished homes. They’re not resales and they haven’t sold. And we’re heading up to a year.
Shawn:
I remember it wasn’t that long ago, Bob, where your average duration of inventory was like one month. So homes, if you had it on the market for 30 days, it was kind of weird.
Bob:
So those that just invested in real estate probably pretty much hurting right now as we see interest rates are at 7.5-8% when they were 3% just a year ago.
Shawn:
As a side note, we are not dogging on anybody investing in real estate.
Bob:
Not at all.
Shawn:
That’s just a very common example of when someone is investing in one primary area. Definitely the most common.
Bob:
You know me, I’m a big real estate investor.
Shawn:
Oh yeah, yeah. We’ll have to cover that on another day.
Bob:
Yeah, we can. Alright.
Shawn:
But number 8, trying to time the markets
Bob:
Just doesn’t work.
Shawn:
It doesn’t.
Bob:
The markets will move so quickly that you cannot time them, and thinking that you can and be successful at it, you’re going to be on the wrong side of the trade.
Shawn:
Bob, I do have a question for you to cover for our viewers and listeners. Trying to time the markets doesn’t work. Now, how is that different with how we manage as a fiduciary discretionary advisor? How is that different? Because I’m sure that someone watching right now or listening is going to say, well, isn’t that something you guys do in your management?
Bob:
Not necessarily. No, we really don’t because we’re looking at long-term trends and we were looking at long-term trades. We never make a trade to go to over-wait a position or under-wait a position. We never do that based on just a date.
Shawn:
Or to try to time the exact top or the exact bottom. No, I think a good example, which I’m not going to give specific numbers, but there was recently when we were towards the end of 2021, you had talked to us with the investment management team and the idea was the wind’s out of the sails. So even though the boat’s moving forward, there’s not a whole lot supporting continued growth at the rate that we were at.
Bob:
There wasn’t a lot of steam left.
Shawn:
Yeah. And this is third quarter 2021. So no one would look at that and say, oh you timed the market perfectly. Because, I mea,n we were pulling back from some of our positions three months before we actually had a huge pullback.
Bob:
But I didn’t go completely out.
Shawn:
Exactly. Yeah. We made a slight adjustment again, which I think is a big distinction is many times the timing in the market comes into people try to take everything out and then move everything back in. But in professional management it’s a, “Oh well let’s pull some back because that way we’re still invested. However, we also have a little bit of an opportunity to hopefully buy some at a discount.” Again, not necessarily the absolute bottom.
Bob:
It’s over-waiting or under-waiting.
Shawn:
Exactly. Okay. Anyway.
Bob:
So number 7, I want you to read this and I’m going to comment, I got some good comments on this one.
Shawn:
Okay. Number seven, not understanding the Rule of 72 and how compounding works and applies.
Bob:
Shawn, this will sabotage your investment portfolio worse than anything there is if you don’t understand how the Rule of 72 works.
Shawn:
Now, Bob, for our viewers and listeners…
Bob:
I’m gonna explain
Shawn:
…because there may many that don’t know what it is. What is the Rule of 72?
Bob:
Alright, so the Rule of 72 is based on, it’s a mathematical formula where you take the rate of return that you’re making. Okay, so let’s say 6%. The reason I’m using 6% is because 6 goes into 72 perfectly. It goes into it 12 times based on the Rule of 72’s, that means that a portfolio will double if you don’t take anything out of it and is averaging 6% year in year out, that portfolio will double in 12 years.
Shawn:
So not adding or removing any money, assuming it’s consistent at 6% a year.
Bob:
And it would double in another 12 years. So you think about that’s $50,000 going to a $100,000, $100,000 going to $200,000…times four. So we’re going to talk about the times four effect. Okay?
Shawn:
Yeah. Got it. Okay. So number 6, panicking: not understanding the risk-reward relationship and how volatility is a normal part of investing, which I think is important. Bob just made the mention of a portfolio returning 6% a year for the Rule of 72. Now what that does not mean is that you made exactly 6% every year. But it’s that over the course of that 12 year time period, for that example, you are assuming an average of 6%. And the reality shows this is that one year it might be 10%, another year it might be 2% or 3%, might be down.
Bob:
That’s right.
Shawn:
But over that period of time, that would end up being the average. And so that panicking part, that understanding the volatility, whether you’re in a portfolio that is very conservative with just fixed income and cash-like equivalents or you’re very aggressive in 100% growth equity, growth stocks, there is volatility associated with every single one of those. Now the volatility of how much you’re down in a six month window you might be, is going to be very different from one end to the other of that spectrum. But it’s very important that you understand the objective, “Hey, what’s normal?”
Bob:
Because people will see how much their portfolio was down and I had a client in here yesterday and the portfolio was right at $2 million. Well, okay, so if you’re down 4% on $2 million, what’s the number, Shawn, how much would you be down? 4% on 2 million.
Shawn:
Don’t make me do the math right now.
Bob:
$80,000, okay, you’d be down $80,000, but if you’re down 4% on a $100,000, you’re down $4,000. So, it’s hard. It was harder for this person. They’re like, wow, I never thought of it that way. Because the more you have, even though it’s the same percentage, it’s going to be a lot more dollars.
Shawn:
The dollar amount is bigger, the percentages are still the same.
Bob:
That volatility is a normal part of investing and this will sabotage your portfolio. Again, if you do not understand that volatility, risk, and reward are all associated with investment portfolios.
Shawn:
Yeah, that’s right. So number 5, allowing emotions over logic to dictate your investment decisions.
Bob:
I’ve said this over and over, emotions and finance mix together like oil and water, it should not ever, ever be involved in investment decisions.
Shawn:
And one way to think of that, Bob, is your emotions are part of you. I mean we’re made in God’s image.
Bob:
They are. And it’s hard to put that aside.
Shawn:
So what I would say using your favorite saying, it’s just math, is you use the math and logic and the statistics and knowing what is normal versus abnormal to basically help you keep control of your emotions. And if you’re feeling that emotion of “Oh, we need to sell, we need to buy!” Maybe take a second, look at the facts, look at the numbers, seek wise counsel. So your emotions don’t rule you.
Bob:
Look at logic.
Shawn:
So number 4, chasing returns. I think the example you have here is changing car lanes type mentality of you’re in stop and go traffic and all of a sudden a little spot opens. So you move over to the left and you’re like, oh, oh, now spot open. You move back into the lane you were in.
Bob:
Exactly.
Shawn:
And at the end of the day, what have you done? You’re no further ahead really.
Bob:
You’ve gotten no…right.
Shawn:
You just expended a lot of extra energy and stress and frustration jumping back and forth. It’s no different with chasing returns.
Bob:
I’ve seen this, there’s a tendency in us as humans, sometimes we want change every five to seven years and we get caught up in chasing returns. So we think, well if I’ll go over to that new advisor, I’ll get a better return. And it usually happens in a bear market, so there’s nowhere else to go but up. So you feel really good about your new advisor because there was nowhere, I mean his portfolio, her portfolios went down the same amount, but you weren’t there when it happened. So you move from one advisor to another. We get a lot of them, they’re moving from and I’m like, okay, this is how you invested. And I always make sure, yeah, we were down, too.
Shawn:
We tell people.
Bob:
Right, I don’t want to say no, we’re just up.
Shawn:
So Bob, I believe the biggest downfall of how to sabotage someone’s portfolio is because if you’re chasing those returns, what ends up happening? Well, in a downmarket, you move to another advisor. So you’re selling out of the positions that you already had. And usually, there’s a bit of a lag time. So depending on how long the bear market and the pullback is lasting in the markets, you may be selling at one of the worst times. And then by the time the dust settles and you’re actually onboarded with the new advisor and you go through the process you’re supposed to go through and you get invested, you may have missed out on 10-20% of whatever the rally was. I mean, the percentage is, I’m not going to give a specific percentage, but the point is you could miss out on the markets have already started to recover. So not only did you sell while you were down, but now you weren’t in because you were too busy chasing returns somewhere else, right?
Bob:
Yeah. I mean in a matter of 10 days of markets can move easily, move 8-10% they can. And I’ve seen it many, many times.
Shawn:
So anyway, I just thought that’d be a good example of, well how does that actually hurt you? So number 3, using an investment portfolio, like a savings account or a checking account.
Bob:
We see this one a lot, don’t we?
Shawn:
Which does kind of tie into our number one most important thing to remember, which we’ll get into.
Bob:
It does, it does. So we’ll get into that here in just a minute, which is very, very important. But do not use an investment portfolio like a savings account, bottom line.
Shawn:
It’s not a piggy bank.
Bob:
Alright, so we’re getting down to the number one, but first we’re going to get into number 2.
Shawn:
Unwilling to take wise counsel or advice.
Bob:
We’re getting into the top two now.
Shawn:
So if you don’t remember anything else from this program, remember this one we’re about to cover and the last one. So number 2, unwilling to take wise counsel or advice. The Bible teaches us the importance of seeking wisdom and counsel, ignoring advice from experienced professionals can set you on a dangerous path. We have seen, Bob more than I have because he’s been around longer, but we’ve seen portfolios go from flourishing to empty because individuals thought they knew better than those guiding them. And this is not a prideful thing of like, oh, Bob and I are so smart, but this is what we do for a living. And as a fiduciary advisor, our goal is to try to do our best to do what’s best for our clients. So when we give advice, it’s to try to help the people we’re working with. We’re not trying to…
Bob:
We’re not doing it to hurt you.
Shawn:
…be like you don’t know what you’re doing or look how cool we are. We want to help you. And so Proverbs 1:5-7 says, “The fear of the Lord is the beginning of knowledge, but fools despise wisdom and instruction.”
Bob:
That’s scripture.
Shawn:
Exactly.
Bob:
Very clear there.
Shawn:
This scripture emphasizes the significance of wisdom and instruction in the context of investing. Disregarding sound advice could lead to catastrophic financial consequences. It is soul crushing when we have to watch people lose what they have worked so hard for, typically over many years, simply because they were closed off to sound advice and guidance. And Bob, I know you have two wise sayings you’d like to share.
Bob:
It’s the country boy in me. It’s always the country boy in me. It comes out a little bit here. And these two sayings are people can be their own worst enemy. We’ve heard that one before and one that we always used out on the farm with my grandfather. Either you could lead a horse to water for his own good, but you can’t make him drink it.
Shawn:
And if you stick his head in the water, you might drown him if he doesn’t want to drink. So you really can’t force him.
Bob:
Which takes us to number 1. Can you guess what it is? Maybe Jenna can put a drum roll in here. You know what number one reason that people sabotage their investment portfolio.
Shawn:
Large frequent withdrawals.
Bob:
Yep.
Shawn:
So number one is the heavy price of large frequent withdrawals. The Bible warns us against foolish spending habits, and yet one of the most destructive behaviors we’ve observed is making large frequent withdrawals from an investment portfolio. The immediate ramifications are concerning enough, but the long-term effects are even more devastating.
Bob:
Yes, they are.
Shawn:
We’ve seen this occur through frequent large, one single withdrawal as well as many cumulative ones over a 9 to 12 month period. So, when the total of these withdrawals are more than 6-8% of a portfolio’s value, whether it was that one time or during that 12 month period they totalled up to that.
Bob:
You withdrew more than 8% of your portfolio.
Shawn:
It can have devastating effects on the lifespan of the portfolio. And when you have a $500,000 portfolio and you take out $50,000, well it doesn’t seem like much, right? It’s only $50,000, I have $500,000. Or when you have someone with a 2 million portfolio and they’re taking out $50,000 here and a $100,000 here and oh, I’m going to do a remodel, whatever it is, it adds up so quick. It does. So to kind of reiterate what we said a little earlier, but an investment account is not a piggy bank or savings account. It is meant for long-term growth and then a long-term draw from that, typically during retirement where you’re not earning money anymore and you need to be able to have that last at least as long as you might last.
Bob:
Well, I see a lot of people in their fifties doing this.
Shawn:
Kind of getting closer to retirement, but you’re still 15 years away.
Bob:
I mean they’ve got 30 more years, 35 more years to live. And this is the things we see it for wanting to buy a new car or truck, which today is $50,000.
Shawn:
Oh, easy. Yeah.
Bob:
Easy. Especially for a truck; paying for expensive vacations. We’ve seen this many times over and over. This is an interesting, and I put this in there because I’ve seen this several times.
Shawn:
We’ve seen this unfortunately happening more often now, number three.
Bob:
You’re taking a large withdrawal for an adult child because they want something, and there’s this parent guilt complex if you don’t help ’em.
Shawn:
Because from their perspective, well, you have the money not ,realizing that the very fact that they’re asking, they’re not being a good kid, they’re not being respectful of you as a parent because they’re asking you to take money that’s supposed to help take care of you as you’re getting older.
Bob:
In your older age.
Shawn:
To pay for something that they want.
Bob:
These areas that we’re mentioning right now, the new car or truck, the expensive vacations, the adult child needing some money, next will be home remodeling. All of these should be taken from savings accounts, not investment portfolios. Because when we build an investment portfolio, we’re building it for the long term, and it’s disruptive to our portfolios. We may have just taken a new position and that new position, we plan on that for three years and we’ve only been in it three days and now we got to go and sell that position off. And another thing that people need to understand too, in investment portfolio, having a little bit of cash is a strategy, an investment portfolio. That’s not cash to spend, that’s cash for investing. And it is part of a strategy. I’ve seen this one, too. Speculative startup businesses and these businesses we know, and again, we’re coming to this out of compassion, it’s not here to hurt anybody, but 90% of businesses fail in the first couple of years, and consistently withdrawing money from that portfolio to fund that business because the business can’t fund itself, Shawn. Okay.
Shawn:
And then the last one, just general spending based on things that you want and not needs and living beyond your means. So you have a certain amount of income that you’re living on and then you decide, oh, we want a little bit more. We’re gonna buy a few more things and you start pulling more money from your investment account, and it’s not sustainable.
Bob:
And you notice I have here…
Shawn:
And this happens especially with sudden wealth.
Bob:
Especially with sudden wealth,
Shawn:
Whether that’s inherited and we’ve covered that before, we’ll put a link in the description.
Bob:
Yeah, about sudden wealth.
Shawn:
There’s a lot of reasons why you might have sudden wealth.
Bob:
So here’s the thing that most people don’t realize , large or frequent withdrawals that add up over that 12 month portfolio over that 12 month rolling period, can really destroy it. And this is because of the Rule of 72. So I want to describe this to you. Remember I said the Rule of 72, if you’re making 6%…
Shawn:
Takes 12 years to double.
Bob:
Right. Okay, so just say you’re 60, that’s 84, 24 years ahead.
Shawn:
To double twice.
Bob:
Yeah. So you take $50,000 out to buy that truck. What you have just done is you have just caused your portfolio, you’ve taken away $200,000 from your portfolio later in years.
Shawn:
Over the next 24 years.
Bob:
What is that truck? Or what is that car going to be worth in 24 years?
Shawn:
Let’s see, 0.
Bob:
10% or 20% of the value. But that’s the kind of thing that I don’t think people really understand and they don’t understand they need to apply the Rule of 72, if they take it out of a growth portfolio that’s averaging 8-10%, now you’re talking about maybe possibly three doubles. So it’s a fourfold effect. So when you take out $50,000 or you take out 20k, it’s like you’re really not taking out 20k, you’re taking out 80k, or you’re really not taking out 50k, you’re taking out $200,000. That is something that a lot of people never think about on longterm consequences.
Shawn:
Based on life expectancies, Bob, if you’re watching this and you have maybe another 20, 30 years that you’re expected to live, then that money you’re taking out, multiply that by four to give you an idea of what it’s really costing you in the long run.
Bob:
That’s correct. That’s right. And Shawn, I’ve seen how long it can take to save it and when you pull it out, usually you don’t get it back. I mean, I don’t think I’ve ever seen withdrawals put back in that were large withdrawals.
Shawn:
Especially later in life. Maybe when you’re younger, maybe in your twenties and thirties. Sure.
Bob:
But bottom line is we don’t want you to sabotage your portfolio. We don’t want to see anybody’s portfolio sabotaged. We want to help you.
Shawn:
The long-term goals – we want to make sure if you’re watching or you’re listening to this, we want to make sure that whatever that God has blessed with, that you’ve been a good steward with and you’ve been saving up, we want to make sure that is still left over whenever you go home to be with the Lord. We don’t want you to be around and the money isn’t.
Bob:
So Proverbs 21:20, it says, “The wise have wealth and luxury, but fools spend whatever they get.” Investing is truly a lifelong commitment that demands patience, discipline, and a trusted advisor.
Shawn:
To lean on. That’s right. And we’re here to offer you that support, of course rooted in Biblical principles and decades of experience, mostly on this side, on Bob’s side. Thank you so much for taking time to be with us today. I know we went a little bit longer, but I feel like this was just…
Bob:
It’s a very important subject.
Shawn:
Really important subject. And even if just one person found this and it helped, I think it was worth it. So if you want to reach out to us for comment, questions, help, whatever it might be, you can reach us via phone or text at (830) 609-6986. You can also visit our website www.christianfinancialadvisors.com. Thank you so much and God bless.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 175 – Can I Recession-Proof my Finances?Can I Recession-Proof my Finances?Learn how to get a better handle financially and emotionally when it comes to a recession.
More episodes >>
“Recession” is a word constantly looming in many Americans’ minds, and it is a common topic among news outlets. But, what if you could prepare financially for a recession? Bob and Shawn discuss the ongoing predictions of an economic recession in the financial markets. They emphasize the inevitability of economic cycles with periods of boom and bust.
Through insight from various scriptures, they encourage diversifying investments across different sectors of the economy, saving during prosperous times, and avoiding excessive debt. Economic cycles are a natural part of life, so preparing for them should be a natural part of financial planning as well.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersUS Debt ClockBible Verses In This EpisodeECCLESIASTES 11:2Invest in seven ventures, yes, in eight; you do not know what disaster may come upon the land.
GENESIS 41Joseph interprets Pharoah’s dream of 7 good years and 7 bad years of harvest and famine.
PROVERBS 6:6-11Go to the ant, you sluggard; consider its ways and be wise! It has no commander, no overseer or ruler, yet it stores its provisions in summer and gathers its food at harvest. How long will you lie there, you sluggard? When will you get up from your sleep? A little sleep, a little slumber, a little folding of the hands to rest— and poverty will come on you like a thief and scarcity like an armed man.
PROVERBS 22:7The rich rule over the poor, and the borrower is slave to the lender.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTShawn:
Is a recession looming? With $33 trillion in national debt, what does the Bible teach us about weathering financial storms? Tune in for faith-driven financial strategies. Let’s get some perspective.
Welcome to another episode of Christian Financial Perspectives. We’re so glad that you’ve joined us today. Whether you’re watching or listening, my name is Shawn Peters and I’m joined as always by my esteemed father-in-law and co-host Bob Barber. Today we’re going to be covering a topic that we believe would be very beneficial to those of you out there – wisely preparing for economic recessions. So today we do have a lot to cover, but we are going to save the scriptures that we have for more towards the end, which will make sense. But Bob, you want to give us a little more of an intro on here?
Bob:
I sure will, Shawn. As you know for about the last year to year and a half, the markets have been predicting, when I say the markets, the stock markets, the equity markets, all the financial markets have been predicting that we’re going to go into this economic recession, especially as the Fed has been raising rates.
Shawn:
Okay.
Bob:
Well, it’s interesting because this has not happened yet.
Shawn:
So for over a year we’ve been hearing the predictions of, “We’re going to have a recession. We’re going to have a recession.” So will it happen? Maybe. Maybe not, but we have some things to cover in relation to that. So I would say the first one, there will always be economic booms and busts. Always. It’s just a natural part of economic cycles and preparing for recessions is wise.
Bob:
It’s like the balloon. You can only blow the balloon up so much before there it’s going to pop.
Shawn:
Or the rubber band.
Bob:
It’s natural. The rubber band, you can only stretch it.
Shawn:
You can stretch it. You can only stretch it so far before it either snaps back or snaps.
Bob:
And recessions can be short-lived. Some can be long. The one that we had a few years ago was very short because the government came in and stimulated the economy so much by adding $7-9 trillion of money into the economy and now we’ve got to pay that back, by the way.
Shawn:
I still can’t wrap my head around. I mean $7-9 trillion.
Bob:
A trillion has 12 zeros in it.
Shawn:
Yeah, it’s a lot. It’s a big number.
Bob:
Recessions will always come and go. Some will be short, some will be long, as the famous Great Depression of the 1930s lasted many, many years. I hope we never had that happen again. The one thing that’s different about now versus then is we’re a very diversified economy where back then it was very driven by farming and just industrial, where now there’s all the different sectors that are driving the economy. But the one thing I want to say, Shawn, is the government’s not always going to be able to bail us out.
Shawn:
That’s true. Yeah. Well, as a good example too when Germany, I believe it was after World War I, that they were having serious issues with their currency and they just tried to print more and more money because of the war debts and everything else that they had. And it got to the point that it was more efficient and cost less money to burn German currency to keep warm than it was to actually buy firewood. So there is a point that if we’re not careful for any country, that there is no way for the country to bail itself out, especially not with printing money. You have to actually make some changes.
Bob:
You do, Shawn. The interesting thing though is for the last 90 years, the government bailed us out of the Great Depression. It was with wartime and they started printing money at that point.
Shawn:
Well, also what helped a lot with that Bob, is from the Depression and then going into World War II, is that the industries all kicking into high gear to support the war effort. It wasn’t just about the printing money, but it was something actually happening.
Bob:
Who was paying for that?
Shawn:
Yes, I know the government’s paying for it, but unlike the German example I was saying is that at least there was some sort, there was a lot in the private sector that was actually generating jobs and work and product. So it wasn’t just printing money, but again, the printing money didn’t help either.
Bob:
Yeah.
Shawn:
In the long run.
Bob:
So right now, and you can go to USdebtclock.org and you can see all this, but our country is heading to a debt of 33 trillion. You hear that 33 trillion and Shawn, that’s 50% higher than it was just four years ago. So it took us 80, 90 years to get to the $20 trillion debt. And then in just the last three years, we’ve gone 50% higher and it was all the stimulus checks that Covid, from Covid, that caused this. And there’s a lot of Trump fans, and I’m not going to try to get political here, but 7 trillion of that was from him. Okay.
Shawn:
It’s almost like our government does this kind of regardless of the political party.
Bob:
It seems that way.
Shawn:
Again, not trying to point fingers either way, but it’s just our government as a whole, doesn’t matter what party it is, has a bad habit of continuing to just spend money it doesn’t have.
Bob:
And every time we print more money, every single time, it devalues it. And that’s why we’ve had such so much inflation. Last year we had inflation at 9% and 10%. And it’s interesting now as the government, as the Fed starts raising rates and tightening things back, it pulls inflation back down. But there was all this free money. As you know, two years ago, you had no advantage of being a cash buyer over a borrowing buyer for real estate. So it caused real estate to go through the roof.
Shawn:
The prices of real estate.
Bob:
So 33 trillion, okay. Remember a trillion has 12 zeros behind it. Alright? If you divide that and I looked at the population of the United States, now it’s about 332 million. So I get my calculator out and I divide it, and that is right at nearly a hundred thousand. It’s actually $99,397 of debt for every man, woman and child.
Shawn:
Not household, every man, woman, and child, based on the latest population estimates were 332 million. So wow. So for my household, there’s Jenna and I and our two kids.
Bob:
Right. So you’re about $400,000.
Shawn:
Our share as a family is $400,000.
Bob:
Yes. Yes, exactly. Now countries rise and they fall on debt. The Roman Empire is a very, very good example too of when a government gets too large and out of control and it always eventually falls. Listen, I want to say I cannot, and I will not predict this, okay? I’m not saying that we’re going to fall off a cliff tomorrow. I’m not saying we’re going to fall off a cliff in 20 years. I am not going to predict when this is going to happen. But you know me, my favorite saying…
Shawn:
It’s just math.
Bob:
It’s just math.
Shawn:
And in this case, math doesn’t lie. So this is less of a, we’re trying to scare you. And then so you have some ad about buying gold or coins or whatever afterwards that this is more of just trying to give some sort of realistic expectation of this is the way stuff works. But again, not a prediction on this is going to happen next year or something like that.
Bob:
Not at all. And we’re going to get into some scriptures pretty deep here in a minute. Normally we start off at the beginning with scripture, but we’re going to end up the program today. We’re going to spend some good amount of time with scripture, because scripture gives us examples of how to prepare for recessions. And you should never just go stick your head in the sand and say it’s not going to happen. But governments, they get less and less efficient the larger they get. That’s right. Our forefathers were geniuses, but I wonder if they ever realized we’re going to be 332 million people.
Shawn:
Well, and spanning how many thousands of miles across?
Bob:
The US huge. We were 13 back
Shawn:
Then. Yeah, 13 colonies just kind of over on the east coast and now compared to the size of the country then, it’s huge.
Bob:
And over taxation. And the government’s attempt to equalize everyone. It never works in the long run because you know what the wealthy will do? They’ll find a way not to be taxed at higher rates or they’ll leave. They’ll just leave. And politicians that say the wealthy don’t pay their fair share, they’re just liars. Okay? All you got to do is go look at a tax table, just pull up IRS tax table and you’ll see that the more you make the larger percentage you have to pay. And we have people in our country paying 35% and 40% with state tax paying him 50%.
Shawn:
Bob. I have a really interesting example. I’d like to cover that. So Warren Buffett, it wasn’t that long ago that he had said it was like an interview and he was talking about how he pays less taxes than his assistant, his secretary, whatever position was. And while technically you could say that was true, the problem was even for him to say that knowing full well what he was saying was incredibly misleading. And in my opinion, when you say things in a way specifically to mislead people, that’s the same thing as lying to him. And the reality is that people who actually work and make an income, I think like doctors and lawyers and people who make arguably a very large income, the problem is they’re making a normal income where they work and got paid and they pay income tax off of it. But when you talk about this really, really wealthy families who are able to, oh, they just sell some of their stock positions or things like that and they’re only paying capital gains, okay, sure. Technically their overall taxable rate isn’t as high. But again, when they sell those stocks, it’s not like they didn’t work. They took a risk by having that money invested. There’s a reason why we have the income tax rate and the capital gains rate. But in either case, the idea of like, oh, the wealthy aren’t paying their fair share is still ludicrous as a whole because the vast majority of Americans pay not just percentage wise, but dollar amount wise, pay way more than the rest of us.
Bob:
And Shawn…
Shawn:
So anyway, rant over.
Bob:
Boy, you did, didn’t you?
Shawn:
I’m just frustrated hearing that. It’s such a lie that politicians use to basically trick a bunch of us that aren’t in the 40-50% tax bracket,
Bob:
But even you have long-term capital gains with the 20% plus an additional what they call the Obama care tax, you’ll be at 24-25%.
Shawn:
And what that doesn’t take into account, unlike with income tax over time and the amount you pay, the tax rate…
Bob:
We have to go on.
Shawn:
Okay, I know, but I just want to make sure that people hear this point and stop repeating that stupid lie about the wealthy don’t pay their fair share. The capital gains tax is lower, but it doesn’t take into account inflation. So the purchasing power change. So when you hear about these changes to capital gains on how people should pay money on investments, even if they didn’t sell anything, it’s even more ludicrous. We need to do another episode on that. I’m frustrated. Let’s go.
Bob:
I could tell. I could tell. Okay. Here’s the one thing, though. I want you to understand when we talk about preparing for economic recessions, that they’re always going to come along and there’s going to be good times and bad times because scripture tells us. We’ve shared this scripture many times, “There’s a time for everything.” There’s going to be good times and bad times. And some of the scriptural examples I think are great to apply for recessions would be, the first one would be Ecclesiastes 11:2, which we mention around here a lot is, “Invest in seven ventures. Yes, in eight, you do not know what disaster may come upon the land.”
Shawn:
I mean, I can’t think of a better scripture that directly talks about preparing for recessions, whether it’s minor or major.
Bob:
So we’re talking about all the different sectors. There’s 11 to 12 different sectors of the economy and everything from utilities to energy to technology…
Shawn:
Healthcare, real estate,
Bob:
Yeah, you name it, they’re all listed. So that’s what this means is you don’t go put all your money in one basket. It’s like mom always said, don’t put all your eggs in one basket. That’s right. Okay.
Shawn:
So in mathematical terms with seven to eight, you’re looking at somewhere around 12.5 to 14.3%. Don’t put any more than that in any one particular sector, especially when you hear the news talking about how oh, technology is up 70%. Well first of all, you missed the opportunity to move into it.
Bob:
What’s this already up 70?
Shawn:
But also definitely don’t put any more than say 12.5% to 14.3% in there because you’re going to be way overweighted and not properly diversified.
Bob:
So I have these listed again, technology, real estate, healthcare, energy, consumer staples, materials, and the list goes on. And people have a hard time with this though. I was just talking with Don here in our office this morning and he’s talking with the business owner and the business owner has everything invested in his one business and he has very little outside of that.
Shawn:
Which is dangerous.
Bob:
It’s very dangerous. Exactly.
Shawn:
Don’s one of our advisors.
Bob:
Alright, now the other scriptural principle that we’re going to spend some time on, but it’s a whole chapter so we’re not going to read the whole chapter.
Shawn:
Genesis 41.
Bob:
Genesis 41. And it gives us an example in here where Pharaoh has a dream and he has Joseph, not the Joseph in the New Testament, the Joseph in the Old Testament, the one that the brothers all…
Shawn:
The one with the bright colors, uh coat.
Bob:
They threw him in the hole and then he came out and pretty much helped run, not ruin, but run each later. But he had him interpret the dream and this dream he was seeing these seven fat cows and then he was seeing seven lean cows.
Shawn:
They were like famished.
Bob:
Pharoah’s like, what does this mean? And he said, you’re going to have seven good years.
Shawn:
Of plenty.
Bob:
And then you’re going to have seven bad years. He says, okay, so what should we do? And he says, take a fifth of the harvest.
Shawn:
Or 20% for those of you who don’t remember your fractions.
Bob:
Right. So lett’s take 20% of the harvest during the good years and save it up.
Shawn:
For the bad years.
Bob:
That’s preparing.
Shawn:
To basically help get you through it.
Bob:
Am I not saying right there that is a scriptural principle right there.
Shawn:
I believe that emphasis is in…
Bob:
Preparing for economic recessions
Shawn:
Verse 34 through 36. So if you’re wanting to look at it.
Bob:
Okay, yeah.
Shawn:
And the other part that’s amazing with this Bob, is that that preparation was not just Egypt, but many of the countries surrounding it, including the land of Canaan or whatever it’s called at the time. Joseph’s family, when they came to Egypt, Egypt was basically the only place in the area that wasn’t dying off from the famine. And so had it not been for the position that Egypt was in and that God had over time gotten Joseph exactly where he needed to be, it wouldn’t have just been Egypt, but the entire area over there in the Middle East might have died off. I mean, we don’t know what would happen. But the point was God took care of both Egypt and the surrounding countries from having Joseph at the right place.
Bob:
And I believe that this is in the Bible to give us a scriptural example how to prepare for recessions. We’ve got the Ecclesiastes, give your portions of seven or eight. We’ve got Genesis 41 that talks about preparing and saving during the good years, not living like…there’s people you’ll see in the good times, you just spend, spend, spend and they live like there’s no tomorrow and that’s not wise. And then we go over, right over to Proverbs, it talks about the ant. And we’ve mentioned this many times. We don’t have to read the whole thing today, but he talks about, “You sluggard.”
Shawn:
That’s right. So consider the ant and don’t just sit around and just think, oh yeah, that’s fine. We don’t need to prepare or anything because scarcity and poverty will come on you.
Bob:
Like a bandit.
Shawn:
I’m paraphrasing.
Bob:
Yeah. But it says it was saving in the summertime for the wintertime. Alright. Because think of wintertime and economics like an economic winter.
Shawn:
Exactly. Or a recession.
Bob:
And then debt is the same way. Don’t get yourself in a lot of debt. Proverbs 22:7, and we read this many times on Christian financial perspectives. You become a slave to the lender when you have more debt than you can handle.
Shawn:
Specifically, “The rich will rule over the poor, and the borrower is slave to the lender.”
Bob:
So God has given us in his word how to prepare for recessions. It’s all laid out right there.
Shawn:
So Bob, what do we do with all this information?
Bob:
You take this information and you put it in financial planning and you diversify your portfolio, you build cash reserves up to that amount. And by the way, if you’re saying what does that amount, 20% times seven. 2×7=1.4, that’s 1.4 years. I know that’s a long time to think of cash reserves. Most people were thinking in six month realms or even three months if they can get there. But the point of this is during the good times to be saving up for the bad times because they will always happen. God’s word says it will happen and God’s word is always true.
Shawn:
But the good news about that too, it says in Ecclesiastes that there’s a time for everything. That’s also not something to be scared of. Because just like we know there will be bad times in the bad times, we know there will be good times again.
Bob:
And God does not want us to live in a spirit of fear. That is not of God. Okay? So be wise and plan, plan, plan. And we’ll help you with all these variables so you’ll be ready for any minor or major significant economic recessions because they’re going to happen and when the next one’s going to happen. I’m not going to predict, I don’t predict things like that, but I do believe it’s wise to always be prepared, and we can advise you using proven long-term biblical principles. They’re in the Bible. The Bible has so much to say about finances. We know it’s 1500 to 2000 scriptures is what biblical scholars say. Alright. You want to talk more about this? You want to prepare for the next recession, you want to handle things from a Biblical perspective with your finances? Give us a call, we can be reached at (830) 609-6986. You can call that or text that during business hours. Or you can go to our website www.christianfinancialadvisors.com. And Shawn, any last words?
Shawn:
No, I think we covered it. And apologies everybody on my rant earlier, we’ll do another episode on that, so I can get it all out there. But thank you so much for joining us. God bless, and we’d love to hear from you. So send us an email, text, comment down below if you’re on the video. And other than that, God bless you. Thanks for joining us.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 174 – Pioneering Faith Based Investing: The Timothy Plan StoryPioneering Faith Based Investing: The Timothy Plan StoryLearn about the history of The Timothy Plan, one of the pioneers of the BRI movement.
More episodes >>
Delve deep into the history of Christian financial stewardship and Biblically Responsible Investing (BRI) as Shawn speaks with Timothy Plan team member, Brian Mumbert. Christian Financial Advisors is proud to be a part of this movement since the beginning of Timothy Plan.
30 years ago, Timothy Plan introduced only a few morally responsible investment fund choices, and they now offer several mutual funds and ETFs, along with multiple other firms now offering Biblically Responsible Investment options. They are a leader in the BRI movement and have truly helped pave the way for values based investing when it comes to Christians investing with their Biblical principles in mind.
The history of BRI, its growth, and how far it has come over the years is truly a blessing!
GUESTS: Brian Mumbert
HOSTED BY: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBrian MumbertShawn PetersThe Timothy PlanWebsiteWant to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
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EPISODE TRANSCRIPTShawn (00:00):
Ever wonder about the origins of Biblically Responsible Investing? Today we’re diving deep with Brian Mumbert from The Timothy Plan, a trailblazer in the BRI world. You don’t want to miss these eye-opening insights. Let’s get some perspective.
(00:20):
Welcome to another episode of Christian Financial Perspectives. My name is Shawn Peters. We’re so glad that you’ve joined us. If you do enjoy content on finance, but from a Christian perspective, we’d love for you to hit that subscribe button and join our growing community of Christians who are wanting to glorify God with their finances. Now today I’m actually joined by a special guest, Brian Mumbert from The Timothy Plan. Bob is not available, so we decided we’d do a special episode for you. And with this episode, we thought it would be useful to cover a little bit of the history of Biblically Responsible Investing or BRI as that’s what our firm focuses 100% on. And with Brian from The Timothy Plan here, I thought it might be good for us to cover a little bit of the history of Timothy Plan and their role in the BRI movement. Some of you may not know this, but The Timothy Plan was very much a pioneering force in the early days of the BRI movement, still is. And much like my father-in-law, Bob, who is founder of Christian Financial Advisors, they were very instrumental in those early years, I would say. But anyway, without further ado, Brian, thank you so much for joining us.
Brian (01:38):
Thank you, Shawn. I really appreciate being here and there’s a lot of shared connection between Timothy Plan and Bob as Bob was one of the first advisors to really take this Biblically Responsible Investing mandate and really work it into his practice. It was so neat to see. And this was back, we’re talking 1994, or as my son refers to it, back in the 1900’s, which just makes us feel really old.
Shawn (02:02):
Oh yeah, for sure.
Brian (02:03):
But it’s just exciting to connect with fellow BRI believers and to be on this podcast. Thank you.
Shawn (02:08):
Yeah, absolutely. And the respect is very much mutual, Brian. Bob has spoken very highly of Art Alley, since I know he’s known him for a number of years, and their collaboration as pioneers in the BRI industry. So with our shared history, I guess you’d say as our shared firms, but with our shared history, do you think you could shed some light for our viewers and listeners on the early days of Timothy Plan and some of the challenges that you encountered?
Brian (02:34):
Sure. So early on in Timothy Plan, you have to go back to the start and what caused Art Alley to even do this. He was a financial advisor. He had his own practice and he was looking to put together retirement plans for nondenominational pastors. And ultimately what he found was that he could not get any of the fund managers to take on this mandate of screening out or filtering companies that would not profit from things like abortion or pornography. They said it couldn’t be done. They didn’t want to take the challenge, they didn’t think the performance would be okay, and they told him he was crazy. So he ended up starting Timothy Plan to be this retirement plan for non-denominational pastors. It ultimately ended up being a mutual fund. There was a lot of skeptics out there though. I mean outside of the investment advisor community.
(03:24):
The consumer had no idea. This whole idea of investment is ownership and how this all works, and I’m just investing in a mutual fund. It’s a growth fund. What’s in this fund? I don’t even know. And so, the education challenge was huge. There were a lot of financial challenges at Timothy Plant when we first started. There were times where we didn’t know if we were going to make it. Art had to meet net capital several times in the early days and go back and ask for more funding and more funding to continue and say that this is going to work. Just trust me. And again, Bob was there at the beginning using our funds, and we had one fund, and so you’re trying to allocate your clients into different asset classes, but all we can give you is small cap. And that was a frustration, but through a lot of faith, a lot of prayer, a lot of support in the community, it became a viable option. And here we are almost 30 years later.
Shawn (04:17):
Yeah, man. Well, it’s so heartening to hear about the support from stalwarts like Bob, given our firm’s focus on BRI, I know firsthand about the challenges, but also the rewards. So what unique hurdles did Timothy Plan face due to its BRI focus?
Brian (04:36):
There were a lot of skeptics, again, that said that this could not be done. When we started this, you had social investing was a big thing. You could remove things like alcohol and tobacco and gambling, but we had to lay the groundwork for this. And then like I said, the education was the big issue. So you could educate the advisor, but then the advisor, we had to count on them to educate their clients. Unfortunately, you did not have a lot of advisors like Bob that would be willing to put themselves out there as Christians and to even just ask simple questions to their clients, are there any moral or ethical concerns that you might have before I make any recommendations in these portfolios? And so changing the habits of something that they’ve been trained for decades on was a big headwind.
Shawn (05:27):
Right. And then logistically, did you have any challenges there as far as with BRI and being able to actually align the funds with the different screening process?
Brian (05:41):
It took a lot of time to build this screening network or a screening of companies as we’ve done. And the benefit of being as whole as we are now is now we have data that goes back 30 years. And so we’re looking at companies and when we look at these companies, we’re looking at a repeated pattern. Is it something that a company does every year? Do they fund Planned Parenthood corporately every year or is it just one time back in the 1900’s when they did it and they haven’t done it since? Because we’re not in the business of just punishing a company for something they did decades ago. We want to see that a company is doing these things on a regular basis.
Shawn (06:21):
So that continuous research, adaptation, and monitoring, because you might have a company that for some time was involved in some contentious areas and stuff that wouldn’t align with our beliefs, but if they then change or maybe they have some new leadership and you notice in the monitoring that, “Hey, they’re not involved in these anymore.” Okay, great. Well, that might be a viable option then for some of the funds.
Brian (06:45):
Absolutely. I mean, we’ve seen companies that have changed their patterns. Some for the better, unfortunately, probably more for the worse as we’ve gone in a certain direction in this culture. But still letting each company know, this is why we do not invest in you. We would like to invest in your company, but unfortunately, this is why we cannot really has generated some conversations.
Shawn (07:07):
Got it. Well, it’s always about the community, isn’t it? So speaking of that, I’d love to hear a little bit about how Timothy Plan handled some of the societal challenges, especially in the early days.
Brian (07:19):
Yeah, so there was a lot of pushback. There was a society that did not understand what we were trying to do. I kind of already touched on this before, but the whole “investment is ownership” piece. I was taught that when I was in high school in economics. If I’m shareholder, I’m part owner of a company. But unfortunately, the vast majority of people don’t really understand that concept. And to put it in the most simple terms, if I purchase shares of a company and we could use a tobacco company, for example, I need that company to be profitable. What is their business? Well, cut and dry their business is selling tobacco and ultimately the addiction of people that are using their products. If I’m shareholder of that company, I need them to do whatever they do better and more of. And so unfortunately, if I own a company like that, morally, it can create a big question in my mind about what am I doing with the money that God has entrusted to me here? How am I earning these dollars? And I’ve heard many describe “ill gotten gains” as it talks in Proverbs.
Shawn (08:24):
That’s a good example.
Brian (08:25):
And yeah, it really is that. So education, again to the end client, Art put together a Biblical stewardship series actually many years ago to kind of really do this because ultimately people need to understand that there is a way to align their investments with their faith. They just have to hear about it, they have to know about it. And advisors like Bob that tell them about it. That’s really the key.
Shawn (08:51):
Many people from what I’ve seen personally, but also from hearing from Bob, from his experience in working with you guys, that people would see BRI as it’s somehow restrictive or it’s outdated, like, oh, whatever. Those values don’t matter. But at the end of the day, it does matter. I mean, because if you have a certain set of beliefs as a Christian that you apply to your entire life, and then when it comes to your finances, when it comes to your investments, you leave it at the door, how could you possibly say that you’re really giving your life to Christ, that God is actually the God of your entire life? Because I remember, I think Bob was the first one that gave me this example, but use the analogy of someone accepts Christ and they’re going to get baptized and right before they get dunked under the water.
(09:37):
Well, for me and Bob, we’re Southern Baptist, so we got dunked, not sprinkled, but
Brian (09:40):
I’m a dunker.
Shawn (09:41):
Assuming you’re a dunker, right Before you get dunked under the water, you grab your wallet and hold it up above the water. You’re like, well, okay, Lord, I’m dedicating my life to you except for my wallet. It’s kind of the same idea that somehow that doesn’t apply or matter, and in reality it does. And I would say more so even than on their retail side, when people say, well, there’s a lot of companies that you only have a few choices for necessities. Okay, well, that’s very different than when you come to an ownership side. There’s a lot of choices, not just between mutual funds and ETFs, things like that, but just in general, the number of companies that are available to invest in. With so many options, you can’t really make the argument of, well, there’s no way to actually do this, or there’s no way to be clean.
Brian (10:26):
You really hit the head on there because the whole choice thing is the huge thing. You get pushback all the time. I have an Apple phone. Well, my choices in phones are limited, unfortunately. My cell carriers, unfortunately, are limited. And some of them are in the cable business, in broadcast pornography. I’m sorry. I wish I had a better choice. And I know that there are some out there, and we’re getting better with these things. But ultimately, in the investment world, I get a choice.
Shawn (10:52):
There’s lots of choices.
Brian (10:53):
Take control of the finances and do what God wants me to do as a steward of his money and invest Biblically. And it’s a huge, huge thing that many more Christians could understand. I love that image of holding the wallet above your head.
Shawn (11:08):
Feel free to use that. It’s not copyright or anything.
Brian (11:10):
That’s fantastic.
Shawn (11:11):
Yeah. So would you say, I guess that really over time, from those early days to now, that we’ve really seen more of a shift in people’s perceptions as the alignment of their investments and their faith continue to gain traction?
Brian (11:25):
Yes. I’d say definitely three decades now basically of this. And now there’s other people in the business that are doing this, other firms that are doing this, other investment companies that are providing product, and it’s great to have more product. We need more choices. So yes, it’s come so far, and I think that honestly, investors have learned, especially if you just take the microcosm of this past year, that companies are not their friends. They will do things that will really alienate half of their client base and they do not care. And it’s up to you to tell them that, and how are you going to tell them that you can try to boycott, and we’ve all done this before, but in reality, stop investing in the company. That’s how you tell them.
Shawn (12:09):
If their share price starts dropping, that’ll get their attention real quick.
Brian (12:12):
Absolutely.
Shawn (12:12):
That’s something that I think with companies like Timothy Plan, and I know there are others that we work with as well, but when you have mutual funds and ETFs, one of the other benefits of doing that is that we have this collective bargaining power that through a company like Timothy Plan being able to say, “Hey, we’re divesting from your company because we just found out that you now own a casino, this real estate fund or something like you own this casino or you are now giving to Planned Parenthood,” and you say, “We’re going to be moving out.” And if it’s one investor with a thousand dollars and maybe even a million dollars, the company say, I don’t care, whatever. But if it’s multiple millions or even hundreds of millions of dollars, they’re like, “We’re going to leave.” Well, now all of a sudden they’re more likely to listen.
Brian (13:01):
Absolutely. I mean, you’ve gone from a position where I feel helpless to enact change to. If we all as Christians did this, we can enact the change that we’re looking for. And so at this point it’s like, what are you waiting for?
Shawn (13:14):
Yeah. Yeah. So I really say with all of that, I know we covered quite a bit there, but it’s really a testament to perseverance and continuing that even when it seemed like nobody was listening, it seemed like maybe you weren’t going to make it or whatever, but just a testament to perseverance. And shifting gears a little bit, looking at BRI’s trajectory over the years, how have you seen the industry evolved and where do you see it heading now?
Brian (13:41):
It’s a really exciting time because when we started, it was just mutual funds and mutual funds are still a huge part of what everyone invests in. But four years ago we started ETFs as well, and now I know there are other firms out there that do SMAs and different products like that. So the product lineup is really increasing because ultimately you want to do this in every aspect of your investment life, and you’re going to need different products for different investors. So it’s exciting to see what’s gone from one small cap value fund to 12 mutual funds, seven ETFs at Timothy Plan alone, and then ultimately other firms and other investment companies that have other products as well, and just giving investors the choice to do this. And so it’s come so far. The future really is unlimited on this. I mean, it’s just, again, it’s a matter of education. It’s a matter of the clients knowing they have the choice, and it’s a matter of making an impact with your dollars.
Shawn (14:37):
Now, I know our firms come at this a little bit differently. You guys focus more on providing the fund choices, and whether it’s Mutual Fund or ETF and our firm Christian Financial Advisors, we focus more on working directly with investors, with clients. But that being said, have you noticed much of a shift as far as does it seem like more people seem to be finding you and seeking you out and wanting to learn more about BRI and about aligning their faith in their investments?
Brian (15:06):
I would say absolutely. I mean, you look at all these reports and there is a lot of truth to this that the churches are shrinking, that Christians are falling away from the church, are walking away from their faith, but the ones that are staying are very dedicated in their faith. And as we continue to push this back out into the United States and abroad, this is a way that we can again, take capital and make a difference in society, and we have to be transparent about what we’re doing here. It is a challenge, but there’s a lot of cooperation between the firms that are doing this to increase this movement. We have advisors like Bob that are a big part of groups like Kingdom Advisors that are pushing this forward. And so ultimately, it’s still a very exciting time. And I have to say, interestingly enough, one of our best advertisers recently has been companies like BlackRock that have been pushing ESG, and people are realizing that might not be exactly what I’m looking for. It is a values aligned investment. It’s just not quite the value I thought I was getting.
Shawn (16:18):
Okay.
Brian (16:18):
Yeah.
Shawn (16:19):
You threw me a little bit when you said BlackRock. What do you mean? Okay.
Brian (16:22):
Yeah. So we’re finding people that find us because they’re looking for something that’s more reflective of their personal faith. And so through no fault of their advisor, they heard those words. They thought, well, this must be exactly what they’re looking for. And they put them in a product like that, not realizing that might be of Christian faith and want something that really more reflects my stance on being pro-life and pro-family and not so much on being whatever BlackRock pretends to be at this point.
Shawn (16:53):
So effectively the raised awareness about ESG has made more investors open to the idea of, oh, values-based investing. I know recently the SEC decided to name everything ESG, which I know for us definitely in the Christian space, kind of raised the hair on the back for our neck and everything. Trying to understand well, no, no, I understand what they were trying to do. But for people who’ve been in the industry a long time doing values-based investing, I would say it’s more of a, okay, values-based investing, there are different types of that. There’s ESG, which we would consider typically not very Christian. You actually have Christian focused, and then there are other options, but it really all comes down to it’s a type of values-based investing.
Brian (17:40):
Exactly.
Shawn (17:40):
You just want to make sure, is it the values that you actually hold to or not? If not, maybe look for something else.
Brian (17:47):
Exactly.
Shawn (17:48):
Well, as we continue this journey, it’s kind of the last section before we wrap up, but do you have any advice for financial advisors like myself and others who have followed the path trailblazed by people like Bob and Art?
Brian (18:02):
I would say people like Bob have been doing it right for a long time. I mean, look at the name of your firm, like Christian Financial Advisors. You’re not hiding from who you are. You walk into your office, you know exactly what you’re going to get. I walked in, I saw in the lobby there was a screen that was talking about Biblically Responsible Investing. So it’s conditioning the client and you’re knowing what you’re going to be getting. And if you don’t like it, that’s fine. There are a lot of other advisors around. But for advisors, really it’s a matter of living out your faith and not checking it at the door. You go back to your image of holding the wallet up above the water. It’s like, “Well, I’m a Christian, but when I walk through my work doors, I’m just going to be myself and I’m not going to live my faith in my practice.” I’m nervous about that. Don’t be nervous. There are clients that want this, that expect this from you. They’re Christian, they probably chose you because they knew you were a Christian. We all run in the same circles, and they’re looking for you to provide Biblical advice for their investments, and what better way to do it than to do Biblically Responsible Investing. And so, I really want to encourage advisors out there. There are so many clients that are looking for this, they just need to hear it.
Shawn (19:13):
And I would say from my more limited experience compared to Bob, but from my experience, don’t be afraid. If you are an advisor and you’re watching this or listening, don’t be afraid to potentially lose a client or a potential new client because it doesn’t really make sense to me to be offering Biblically Responsible Investing and also non-Biblical responsible investing.
Brian (19:33):
Exactly.
Shawn (19:33):
A house divided cannot stand. Make a choice. If you’re a Christian, if you’re a believer and you’re a financial advisor, choose to do this or not. But if you choose to do this, don’t be afraid to lose someone. Number one, I think you’ll have more clients that will respect your commitment to it, but also ultimately we will answer to the Lord one day. So why not do this? And keep in mind too, yes, we all have different businesses, but when it really comes down to it, I see this as for those of us that are Christians in this space and we’re trying to be Biblically responsible in how we manage assets for our clients.
(20:11):
This is a community, so we shouldn’t see each other as competitors, but as companions, and I tell people all the time when we’re having a potential sales meeting, and I just say, I pray that the Lord would guide your steps. And if our firm, Christian financial Advisors, is where you’re supposed to be, I pray that God will give you peace in your heart and if not, give you a check in your spirit that this, for whatever reasons, this isn’t the right place, but don’t be afraid to tell me that you don’t think it’s the right fit. Because if that’s the case, I can go to Kingdom Advisors, National Association of Christian Financial Consultants. There are other resources where I’ll find it. If it’s just a matter of you want someone that’s nearby, you want someone physically you can go to their office, that’s fine. Just because a lot of people are using Zoom and whatever, and other web meetings stuff doesn’t mean you have to do that. And if that’s the case, I would rather connect you with a fellow believer who is doing what we’re doing physically nearby you than you to go to some secular investment management company.
Brian (21:11):
Yeah. I talk about this all the time because advisors are, I don’t want to market in my church. And I understand you don’t want to treat church as your business place necessarily. It’s a place of worship, but at the same time, people need to know what you do because…
Shawn (21:28):
And that it’s an option.
Brian (21:29):
Right. It’s an option because I, as a person, if I need something fixed in my house, if I’m looking for a handyman or I need something done, the first place I want to go to is, does someone in my church know how to do this? Can I pay them to do it? I’d rather pay them to do it than pay someone I don’t know to do it. Besides, we will both benefit from this. And at the same time, I could say, I can walk into my own church of 400 people and they kind of know what Timothy Plan is, but if I ask someone to describe it to me, I don’t think I get more than 10 or 12 that could actually articulate what we do. And so here we are in my own congregation, and they don’t understand. So do not be afraid. People need to understand.
(22:11):
If they don’t get advice from you, they’re going to get advice from the world, and we know where that’s going to go. So yes, please help people out in Biblically Responsible Investing. And the last thing you mentioned, the whole network of investment firms. We’re not competition with each other. We need more product in this space. And we all work together to increase the awareness of what is Biblically Responsible Investing. And so even though we have different firms and different ideas about how we screen, and some do and some don’t do as well as others, we’re all working towards the same goal. And so we will work together to amplify this message and to help Christians understand that investment is ownership and you can make a difference.
Shawn (22:57):
And that through all of that, regardless of which firm you’re working with, we’re still expanding the Kingdom of God.
Brian (23:03):
Absolutely.
Shawn (23:03):
And specifically through the Gate of Finance. And so, yeah, man, this has been very enlightening to hear about Timothy Plan’s journey and the challenges that you guys have faced over the years and just kind of how the industry has evolved over time. Very exciting. I hope this has been beneficial to those of you watching and listening. It was a little bit different of a format. If anybody missed Bob, feel free to put in the comments. It’ll make him happy. I won’t tell Brian. I don’t want to hurt his feelings. But yeah, thank you so much for being here, Brian.
Brian (23:34):
I really appreciate it, Shawn. And again, thank you to Bob for all the contributions he’s done over the years and being such a stalwart in this industry and not checking his faith at the door. We really appreciate that.
Shawn (23:46):
Awesome. And well, thank you guys for what you do and continue to do. So as always, thank you so much for joining us. If you did enjoy this, I would love for you to hit the like button, subscribe, share with your friends, and as always, God bless. Thank you.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Join financial advisors, Bob Barber and Shawn Peters, as they discuss the Biblical view on retirement. Drawing from Numbers 8:23-26, the only passage in the Bible explicitly mentioning retirement, they note that the Bible's context of retirement doesn't perfectly align with typical Western ideas. The Bible actually heavily emphasizes the importance of work, viewing it as a blessing, not a curse.
Retirement for Christians should not mean disengaging from life to pursue leisure but should instead be a phase to serve others. It can be a time to focus on 'marketplace ministry,' using your skills and extra time to volunteer. While they're not against leisure activities like golf, they caution that an obsession with such activities in retirement can lead to depression and a lack of fulfillment. Proper planning—both financial and spiritual—is essential for a meaningful, Biblically-aligned retirement.
Click below to listen to Episode 172 – Does God Really Care What I Invest In?Does God Really Care What I Invest InBob and Shawn delve into the reasons why God does care what you invest in.
More episodes >>
Join Bob and Shawn as they delve into the topic of Biblically responsible investing, questioning if God really cares where Christians invest their money. Drawing on various scriptures, they argue that Christians should invest in a manner that aligns with their faith and values. There’s a difference between merely doing business with companies and actually profiting from them. Thus, ownership implies a greater level of responsibility.
They also address a common question about whether one can both invest responsibly according to Christian values and have a diversified portfolio. The answer is a resounding yes, noting that there are over 2,500 Biblically responsible companies and a variety of corresponding ETFs and mutual funds. Overall, this episode serves as a guide for Christians who seek to align their financial decisions with their faith.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This Episode1 TIMOTHY 6:9-10Those who want to get rich fall into temptation and a snare and many foolish and harmful desires which plunge men into ruin and destruction. For the love of money is a root of all sorts of evil, and some by longing for it have wandered away from the faith and pierced themselves with many griefs.
2 CORINTHIANS 6:17“Come out from their midst and be separate,” says the Lord. “And do not touch what is unclean; and I will welcome you.”
PSALM 24:1The earth is the Lords and everything in it.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
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EPISODE TRANSCRIPTIntro:
Ever wondered if God cares about where you invest your money? What if your investments support things like pornography or abortion? Stick around as we explore why Biblically responsible investing is not just optional for a Christian, it’s essential.
Shawn:
Welcome to another episode of Christian Financial Perspectives. We’re so glad that you joined us today. As always, if you enjoy content on finance, but from a Christian perspective using Biblical principles, we’d love for you to hit that subscribe button and join our growing community of fellow Christians who want to glorify God through their finances. Today we’re going to be covering the topic, “Does God really care what I invest in?” So for example, does God really care if the companies or mutual funds I buy in my IRA or brokerage account support things that are completely against my beliefs as a Christian? The short answer is yes. So end of episode, right Bob?
Bob:
I guess that’s it. Yeah, we have a lot more to share.
Shawn:
We have a lot more to share. So we will go into the why, but as always, I’m joined by my co-host Bob Barber. And Bob, I know this is something that has been near and dear to your heart for many, many years in your chosen field of your profession. So why don’t you take it from here?
Bob:
Okay, I will. So does God really care? That’s a good question. Isn’t it? What you invest in. Does he care if we support companies that are supporting pornography and abortion and destructive behaviors and lifestyles such as the LGBT? You took some of this out.
Shawn:
LGBT+
Bob:
T plus,
Shawn:
There’s a bunch of letters now.
Bob:
Adultery, human slavery, gambling, alcohol addiction, and anti-family entertainment. I believe he does. Does it really matter to God if these companies I invest in support these agendas as long as they’re making a profit? I think it does. Yes, it does matter. And as a Christian, if profit is your only goal, you need to search your heart. And that’s what we’re going to do today. We’re going to search.
Shawn:
That’s right.
Bob:
We’ve got a scripture here.
Shawn:
First scripture for today is 1Timothy6:9-10, which warns us of this by saying, “Those who want to get rich fall into temptation and a snare and many foolish and harmful desires which plunge men into ruin and destruction, for the love of money is a root of all sorts of evil. And some by longing for it have wandered away from the faith and pierced themselves with many griefs.” I do love that scripture, but I do also understand that many of us have misread or misunderstood that scripture because you hear many times, oh, the love of money is the root of all evil, or the love of money is evil or money is evil. You hear different things like that.
Bob:
Well, you hear money is evil, but it’s the love of money.
Shawn:
Exactly. It’s the love of money. Money is just a tool like a hammer.
Bob:
So what we’re speaking of today is if you put profit above principle….
Shawn:
Right, that’s the problem. And that fits with that scripture as well because it’s the love of money, which is the root of all sorts of evil. So don’t put your love of money ahead of your love of God and what he’s calling you to do and the principles that he has set out for us. So the next scripture.
Bob:
Which comes to investing in companies and what they’re doing.
Shawn:
2 Corinthians 6:17 tells us to, “‘Come out from their midst and be separate,’ says the Lord, “And do not touch what is unclean and I will welcome you.'”
Bob:
Psalms 24:1 says, “The earth is the Lord’s and everything in it.” You know what? That includes our investments, Shawn.
Shawn:
That’s right. I’m pretty sure our investments are in the world, so I would think that would be part of that. Right?
Bob:
Exactly. So when we invest in companies supporting immorality, we’re buying them with God’s money because of that scripture. The earth is the Lord’s. So this is God’s money, and we’re buying those companies that support immorality.
Shawn:
Which leads us to our next scripture.
Bob:
It does.
Shawn:
Which is 2 Corinthians 6:14, which warns us of being yoked together with unbelievers, “For what do righteousness and wickedness have in common, or what fellowship can light have with darkness?” So as a Christian, we are managers and stewards, not owners of God’s property. And when we invest in a company either directly by buying their stock or very common for people is indirectly through say, an ETF or a mutual fund. We are becoming a part owner of that company. And when they profit for supporting immorality, we are participating in it. So I’ve heard this analogy before, Bob, and I think you may have even shared it with me in times past, but there’s a principle here. If someone baked you some brownies…
Bob:
Oh, okay, I know where you’re coming from with this.
Shawn:
And they say, well, I just baked these brownies and there’s a little bit of poop in it. Are you going to eat the brownies? No. Well, they say, well, I only did a little bit. I only did a teaspoon. It doesn’t matter, right? Because whether it’s a lot or a little bit, nobody wants poop in the brownies. Well tie that to the company that you’re investing in, whether you own 100% of it because it’s a company you started, you’re a majority owner of 50% or more, or you own 0.5% or 0.05%. Does it really matter? Because in all those cases, you’re still an owner. And ultimately, if we believe what the Bible says and that we are stewards, that everything belongs to God, what we are involved in and something that we are an owner in, we are ultimately responsible for what that company does. And by being an owner, you are saying, here’s my stamp of approval that I believe in this company and what it’s doing, and I’m okay with how it operates. So if that’s not true, why be an owner?
Bob:
See, this is truly, Shawn, this is a faith walk. And this is a walk of, do you believe that what you believe is really real? Do you trust God with those dollars that he’s given to you? And do you trust them enough even though the companies may be making a profit to say, no, I’m not going to invest in that company if it’s making, just because it’s making a profit. If that company is supporting immorality in any way. And you would be surprised how many are, I mean, it’s about 50% of the S&P 500, but I’m going to point out later how many choices we do have, which is actually a couple thousand. So, we’re still good. So the question that it really comes down to, this heart, your heart. Is it okay for a Christian to profit from a company supporting immorality? And no, never. It’s never okay. But what about doing business with one of those companies? I get this a lot. Well Bob, I’m not investing in them, but how can, I mean, I may be doing business with them. Well, let’s look at it that way. I mean, God’s looking at the heart and I think if we try in every way that we can to not invest in those companies or do business with those companies, that’s what God is looking at. But sometimes that’s not possible. Do you realize that?
Shawn:
I think a good example for that, to try to break it down. When you’re talking about investing, you don’t have a choice of two or three companies. There’s thousands of companies.
Bob:
Right. Exactly.
Shawn:
I mean the S&P 500, there’s still a very large percentage of the S&P 500 that would pass Biblically responsible screens, that would pass the screens that we’re talking about and whether or not you can invest. However, when it comes to the retail side of things, so for instance, you need to get a smartphone. I mean, who doesn’t operate in this world now without some kind of smart device, whether that’s a smartphone, computer, or both. And for many jobs and positions, it’s a necessity. It’s almost impossible. Now, it doesn’t mean you have to get the most expensive fanciest one, but it comes down to you need to have that. It is a requirement on the retail consumer side. I’ll wait for a second, but for those of you watching or listening, can you name the two companies basically that you can pick a smartphone from?
Bob:
We’re not going…
Shawn:
Technically 3.
Bob:
We gotta be careful about that.
Shawn:
But effectively when it really comes down to it, there’s maybe three choices depending on the operating system.
Bob:
And none of them would be Biblically responsible.
Shawn:
And when it comes to computers, there’s effectively…
Bob:
Same thing.
Shawn:
I mean, there’s two operating systems. There’s slightly more companies, but it’s still a handful of companies. So I would argue, here’s the other part, too. It’s not just that there’s a lot less choices for something that’s a necessity, but like you said, Bob, it’s about the heart. And when it comes down to it, when you are the owner of a company, whether a lot or a little bit, that is a very different level of responsibility than you purchased a product one time from a company.
Bob:
Exactly. Because when you buy something from a company, while you may be supporting it, you’re not profiting from it.
Shawn:
And you are not becoming an owner and becoming responsible for what that company is doing.
Bob:
That’s the big difference that you’ve got to associate with this. There’s a difference between investing in the company and buying something from the company. Here’s an example, too. I’ve given this example, and we’ve had Eventide Mutual Funds on here give this example, and I like this example. He says, so I need gas for my car. I’m out in the middle of nowhere, and there’s one of the companies that support some of these agendas that violate Biblical principles. I got to have gas in my car. That same company sells lottery tickets that goes into gambling, of course. And they sell pornographic magazines and they sell some heavy hard liquor, which leads to destructive lifestyles.
Shawn:
But of those four things, the gas is the only one that’s a requirement.
Bob:
Exactly. So I’m getting gas from my car and maybe I’m out in the middle of nowhere and Texas right now it’s a hundred degrees plus and I need some water for my family and some soft drinks and maybe some peanuts. Well, I’m not supporting, like you say, the lottery tickets. I’m not buying the pornography.
Shawn:
And you’re not an owner of the company.
Bob:
Exactly. Exactly. So I’m supporting the good in that company and I’m not an owner in it. That’s an example of how you’ve got to understand the difference between investing and owning it versus needing to support. It’s maybe an essential. That is an essential if you’re out in the middle of the desert, you’ve got to have gas.
Shawn:
Okay. Well, Bob, by that same logic. If you’re listening or watching this and you’re thinking, what else could this apply to? Well, think about movies. There’s a lot of different production companies. They make a lot of different kinds of movies, but you may not be an owner, but you can vote and influence those companies through your dollars on deciding what movies you will and won’t support. So if there’s a movie that is a good movie, it has good values, at the very least, it’s just good, clean, family fun, maybe go support that. But then don’t support the movie that is obviously preaching an agenda that does not align with our values as Christians. Well, that’s one of those things where if the company keeps seeing that they’re not making as much money on certain kinds of movies and they’re making more on the other ones, they’re going to probably make more of the movies they’re making money on.
Bob:
Here’s a question I know people are asking now. I mean, as they’re watching us and as they’re listening to us, they’re going, okay, I want to ask you, Bob, me or you, Shawn, I want to ask, can a Christian invest in Biblically responsible companies and still have a diversified portfolio? Yes. Out of the S&P 500, the midcap index and small cap indexes, there’s over 2,500 Biblically responsible companies a Christian can invest in and many choices of Biblically responsible ETFs and mutual funds across all the asset classes that hold these Biblically responsible companies. So, it is very possible today. Now, when I started this 27, 28 years ago, there were only a few choices. I mean, still there was the markets you could go in, but as far as the mutual funds and the ETFs, there were only a few choices. Now, there’s every choice there is.
Shawn:
And I would just like to say, praise God for that.
Bob:
Amen.
Shawn:
To see how much the industry has changed and realizing that there are a lot of us out there, there is a lot of believers and Christians who want to invest like this. And the market has responded in kind to now have so many more choices where if you just wanted some ETFs and mutual funds, you don’t have to go out and individually pick all these stocks. There are a lot of options now and there didn’t used to be. So I guess to answer that question, you certainly can invest in a diversified portfolio and still remain Biblically responsible. Because the other thing to keep in mind when we say Biblically responsible, we don’t mean that the company is Christian. All we mean is that they are not failing in what we call the negative screens. Abortion, pornography, LGBT+, all those other destructive lifestyles and things like that. And then on the positive side, it’s companies that are doing good through how they treat their employees, how they treat their vendors, the kinds of products they’re producing. So it doesn’t necessarily mean Christian, it just means it passes muster with our principles that we can get behind.
Bob:
So we spent a lot of time back in February of this year, we had a three part series on Biblically responsible investing. What we wanted to cover today is, does God care what you invest in? And he does. I believe he does. It’s all in his word. It’s all about it. Alright. And there’s so much about stewardship in the Bible. So I want to invite those of you who have not listened to the three part series we did on Biblically responsible investing back in February. That was episodes 143, 144, and 145. To go back and listen to those episodes on Biblically responsible investing. We give you the history of it and we give you much more detail about Biblically responsible investing.
Shawn:
And those links will be in the description.
Bob:
Absolutely.
Shawn:
Okay. But if you are driving and listening to this, please stop first before you try to click on this.
Bob:
So we are calling all Christians to basically put their money where their mouth is. Because this is God’s money and to come out and be separate and to really look at Biblically responsible investing and it’s out there everywhere. We can help you put together a portfolio or you can go to www.kingdomadvisors.com and look for a Christian advisor in your area that focuses on Biblically responsible investing. We focus on it here. If you’d more information about it, you can call or text us at (830) 609-6986. Or you can go to www.christianfinancialadvisors.com.
Shawn:
That’s right. And as always, thank you so much for joining us. God bless. And I would also say, if you can, pray for this channel and pray for people who might come across this, we hope that it blesses others and glorifies God in the process. Thank you.
——-
[CONCLUSION]
That’s all for now.
We invite you to listen to all of our past episodes covering many financial topics from a Christian Perspective. To make sure you don’t miss any of Bob’s upcoming episodes you can subscribe to Christian Financial Perspectives on iTunes, Google Play Music, Spotify, or Stitcher. To learn more about integrating your faith with your finances, visit ciswealth.com or call 830-609-6986.
[DISCLOSURES]
- Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Professional financial fear mongering is something many have seen or been affected by. Bob and Shawn address the tactics used by individuals and groups to deliberately spread fear or alarm about financial issues. Highlighting examples like claims of the stock market crashing or the need to rely on gold coins for transactions, it is important to question the credibility of such messages.
Listeners are warned to be cautious of such fear-inducing narratives, especially on platforms like social media. Instead, Bob and Shawn stress the importance of discernment, considering the motivations behind these messages, and aligning financial decisions with Christian values and wisdom.
This episode is great for anyone who has or wants to contribute to a work retirement plan, which is most of us! Using the analogy of a dismantled car, Bob and Shawn suggest that many people feel overwhelmed when it comes to deciding how to invest their retirement funds. They highlight common types of retirement plans like 401k, 403b, and SEP, while unpacking the differences (spoiler alert - there’s really not that many!).
As always, listeners are warned about the risks of making uninformed decisions and emphasize the importance of understanding the associated risks and rewards, which is why it’s so important to have a fiduciary based financial advisor. So, listen in and discover more about investing towards your retirement funds!
Bob and Shawn discuss the often-difficult topic of managing finances after the loss of a spouse, either through death or divorce. With compassion, they explain the necessity of understanding your financial picture, such as incoming and outgoing monthly expenses and overall assets and liabilities. As always, they highlight the importance of working with a fiduciary financial advisor who can provide impartial advice, free from conflicts of interest.
The importance of keeping personal finances confidential to avoid potential exploitation by distant relatives or friends is also mentioned. Throughout the episode, they share relevant biblical scriptures to provide comfort and guidance.
Bob and Shawn delve into the complexities of deciding when to take Social Security. They discuss factors to consider when taking Social Security such as your current age, anticipated lifespan based on family history, potential income sources, and whether you're still working. Bob emphasizes the importance of calculating the breakeven point for starting Social Security benefits early versus later, factoring in the time value of money.
They also touch on political implications and uncertainties surrounding the future of Social Security. As always, Bob and Shawn reference Biblical scriptures, tying financial decisions to faith-based values.
How do you view your finances? Is it through a secular or a Biblical lens? Find out by listening to Bob and Shawn discuss the stark differences between a secular and Christian worldview of finances. They share 14 fundamental contrasts, tackling concepts like ownership, control, contentment, decision-making, needs, generosity, fair wages, honesty, and investment choices.
Drawing from Biblical teachings, this episode challenges the self-centeredness of the worldly view, advocating instead for an outlook that recognizes God as the ultimate provider and owner of all wealth. Bob and Shawn encourage listeners to align their financial practices with their Christian values, hopefully turning wealth management into a spiritually enriching endeavor.
Welcome to part 2 of our series on Sudden Wealth, where Bob and Shawn continue their discussion on "Navigating the Minefields of Sudden Wealth". They dive into the dangers associated with sudden wealth, and how to manage it wisely with topics like entitlement, arrogance, and becoming a target for manipulation due to newfound wealth.
While sudden wealth is a blessing, there are also many pitfalls that may surround it. Therefore, Bob and Shawn emphasize the importance of Biblical teachings in handling wealth responsibly. The episode also touches on the idea of testing inheritors with a 'pre-inheritance' to gauge their financial responsibility.
In part 1 of our 2 part series on Sudden Wealth, Bob and Shawn discuss the complex issues around sudden wealth, common sources, and frequent pitfalls. Exploring this from a Biblical perspective, they emphasize stewardship and wise decision-making. Some common sudden wealth sources, including inheritances, property value increase, oil and gas discovery, and divorce settlements are discussed.
They outline common mistakes such as failure to pre-plan for taxes, misunderstanding how quickly money can be spent, and impulsively buying depreciable assets. They strongly advocate for careful planning, caution, and seeking advice to successfully navigate this tricky financial terrain.
In this episode of Christian Financial Perspectives, hosts Bob Barber and Shawn Peters discuss the integration of Christian values into financial strategies by exploring ten Bible verses that have to do with finances and stewardship. They highlight the importance of Biblically responsible investing and avoiding companies involved in unethical practices.
The episode emphasizes slow and methodical wealth-building, the significance of diversification, and the perils of borrowing to invest. It also encourages seeking wise counsel in financial matters and making prayerful choices, because for a Christian, financial decisions should also be spiritual decisions.
On July 4, 1776, our American forefathers signed the Declaration of Independence to officially declare the United States’ intentions of being independent from Great Britain. In this episode, hosts Bob Barber and Shawn Peters discuss the concept of 'Financial Independence' and explore this theme in light of Independence Day, drawing a connection between the holiday's historical roots and one's financial liberation.
The conversation is framed within the context of biblical teachings, particularly Philippians 4:11-13. They present two sides of financial independence: the spiritual aspect, emphasizing contentment and independence from materialism and social influence, and the physical aspect, which includes saving, becoming debt-free, and downsizing.
When we hear descriptions from news outlets about the stock market, newscasters love using big words that play on our emotions. Words such as skyrocketing and plummeting are often in their vocabulary. However, instead of playing on the emotions that words like this evoke, what if we used that information to help understand the stock market better?
Bob and Shawn discuss our much talked about “Cycle Of Market Emotions” chart. By understanding the rollercoaster cycle of emotions when it comes to the stock market, only then can we better anticipate and control our decisions because they are based on information gathered instead of emotions felt.
What type of financial personality are you? You can find out in this episode where Bob and Shawn cover the different types of financial personalities out there. They have divided them into four financial categories that seem to cover most types of people. You might be a…
- Saver
- Spender
- Giver
- Investor
For most people, one category is usually more dominant. Once you figure out which category you dominate, then you can better understand how to spread your finances out a little more over all of these financial areas and not just one.
Buckle up for this great episode on avoiding some of the top financial mistakes that are commonly seen by Bob and Shawn. They have pulled from their past experiences and from the experiences of clients to create a list that can help you avoid these costly financial mistakes in the future.
These financial mistakes include the error of taking financial and investment advice from anyone other than a financially successful individual or a financial advisor (which both Bob and Shawn have friends and clients to which this has happened), as well as more common ones like avoiding procrastination. Before these happen to you, listen in so you can try and avoid these top financial mistakes!
Click below to listen to Episode 159 – Teaching Kids Good Money HabitsTeaching Kids Good Money HabitsWe delve into simple ways to help your kids learn about financial responsibility and create good money habits.
More episodes >>
Teaching kids good money habits doesn’t have to begin when they are teenagers, it can start as young as 4 or 5! It all begins with educating your children on 3 simple areas when it comes to finances:
- Give
- Save
- Spend
By breaking down finances into these 3 areas, it allows even the youngest of children to have a better idea of how to manage their money properly at a young age. Throughout this podcast episode, Bob and Shawn delve into the ways of incorporating good money habits into your kids’ lives. Not only are these basic concepts a great introduction for children to establish financial responsibility, but it can also be an excellent beginning point for those who have never incorporated good money habits into their lives before.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodePSALM 24:1The earth is the Lord’s, and everything in it, the world, and all who live in it;
2 CORINTHIANS 9:7The earth is the Lord’s, and everything in it, the world, and all who live in it.
MATTHEW 25:14-30Parable Of The Talents
PROVERBS 13:11Dishonest money dwindles away, but whoever gathers money little by little makes it grow.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTIntro:
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with a biblical worldview. Here’s your Christian Financial advisors host, Bob Barber and his co-host, Shawn Peters.
Shawn:
Welcome back to another episode of Christian Financial Perspectives. Thank you so much for joining us. Whether you’re currently listening to one of the many podcast options, or you are watching us on YouTube, we’re so glad that you’ve tuned in today. We have a topic for teaching kids good money habits, and if you like these kinds of videos and topics where we cover financial issues, but from a Christian perspective, we’d love for you to hit that subscribe button so you’ll know whenever we post a new episode and it also helps the algorithm so other people just like yourself who enjoy this content will hopefully find it as well. And today is gonna be kind of fun because I have two young kids, four and one. Bob has already raised three kids that are now adults. And so, we’re gonna be coming at this from the perspective of someone who’s already raised the kids and tried to instill good money habits. And I am looking at how I’m gonna do this myself.
Bob:
Shawn, I would say, my kids are really good with these money habits and especially…
Shawn:
You’ve got to see the fruits of your labor in this respect.
Bob:
I wanna say too, that so much of this I was taught though from Focus on the Family, back then it was Crown Ministries, a guy named Larry Burkett. So many of these principles he taught I remember even buying some of the… you can see here, we got the give, we’ve got the spend, and then we have the save. But we actually had a little bank and it looked like a bank and it had this written on it. And we started teaching Jenna, I mean, she was like four years old, five years old. We were already teaching. She’s like, what are you trying to you could tell, she’s like, what are you teaching me? But we taught this concept. It’s basically live, give, grow, like we’ve talked about. But it’s the saving part, and I think the saving part is really good from the perspective. Where’s the saving? Right here, the saving part, we would we would match them kinda like a 401k in their savings part.
Shawn:
That’s a cool idea.
Bob:
Well.
Shawn:
Well, before we get too much into that.
Bob:
Well, I know we’re gonna get into this because this is fun and I’m excited to go over this because I want to teach people how to teach not only their children, but the grandchildren good money habits. Because those good money habits will be used throughout their life.
Shawn:
That’s right. Okay, let’s go ahead and start with the scripture for today. We have Proverbs 22:6. This is from the King James version, “Train up a child in the way he should go. And when he is old, he will not depart from it.”
Bob:
Don’t you love that? I’ve loved that scripture. That’s so encouraging, and those of you who have taught your children in those ways, and Dr. Dobson used to say, when you have the arrows, when you let go of the arrows, you’re not sure where it’s gonna go. And some of them, they’re not there yet.
Shawn:
Yeah.
Bob:
But you just gotta keep praying and they’ll come back because scripture’s true. And I believe scripture.
Shawn:
And just remember that while you’re training those children up in the way they should go, when they get to their teenage years, it’s not that they’re not listening, but there’s just, there’s a lot going on.
Bob:
I’m not, I don’t mean to laugh.
Shawn:
Bob, I heard something. I thought it was pretty funny. But I was talking one of the guys, another father at church and his kids are older. They’ve already moved out. And he made the comment, the reason why teenagers are always so rebellious is because God needs your teenagers to rebel so you have an incentive to kick them out of the house. So, they’ll go learn to be on their own because if they stayed your sweet young children, which obviously as I’m learning, they’re not always sweet, but in general, if they stayed those sweet children that loved you and always respected you…
Bob:
You just wouldn’t wanna let them go.
Shawn:
You wouldn’t wanna let them go. So, he said that’s God’s way of making sure that they get out of the nest.
Bob:
That’s the truth, isn’t it?
Shawn:
And then, with myself personally, I remember like, oh, my parents, they don’t know what they’re talking about.
Bob:
We better hurry.
Shawn:
I know. All I was gonna say, once I got to college and by the time I was done, I started realizing my parents had a lot of good points and maybe they were onto something. So with that, our first one today is teach and lead by example.
Bob:
Yes.
Shawn:
Your kids are watching you.
Bob:
That’s the truth.
Shawn:
And they’re seeing how you give, how you save, how you spend. And maybe not when they’re really young, but they do start to see how you invest as well, once they kind of understand the concept.
Bob:
Mine definitely did because they grew up in this business. And watching dad, and they even worked, I had them stuffing envelopes when they were five and six years old – using child labor. It just hurt them so bad.
Shawn:
It’s called training.
Bob:
Yeah, exactly. It was, it was training. I’m so proud of the way they’ve come out, with how they manage money. It’s really exciting. But it’s like saving, this was back in the old days where you didn’t set up the automatic draft outta your account for your giving and tithing. So, I would write a check and they would get it, get the opportunity to put the check in the offering. It was coming by. And then we taught them about giving, that giving is so important. But sometimes, they’d open up the check and their eyes would get real big. Wow. to them, that was a lot.
Shawn:
That’s more money than I’ve ever seen.
Bob:
But they’re watching that and they’re saying, okay, that’s the example. And that’s the kind of example as parents that we want to give our children is we really gotta teach and lead by example. This thing of, “Just do as” what is it? “Do as I say, don’t do as I do.”
Shawn:
Yeah.
Bob:
No. That doesn’t work.They’ve got, they’re watching everything you do and you want to be very careful, too, of spoiling a child and getting them into what I call an entitlement mentality. There’s a lot of that going around today. Don and I talked about this before, and Don is my age, and we have children about the same age in their late twenties, early thirties.
Shawn:
Don is one of our, just for those of you, Don’s one of our advisors. He was a CPA for about 20 years before he started working with us.
Bob:
That’s correct. And we were just talking about that, how a lot of what we did was all about entertainment and we did, we spoiled a generation and we have to be very careful about that and getting that generation into an entitlement mentality. So when you’re raising your children, you want to teach them this good money habit. So you want to teach them to give first. That’s scriptural. To save second and then spend, did you notice I didn’t say you’re not gonna, this doesn’t go first. You don’t spend first/
Shawn:
You give first.
Bob:
You give first because giving breaks the bondage of selfishness. Because our selfish nature, when we’re giving, we can’t be selfish. It takes that nature out. And then saving for the future, and there’s so many good scriptures that come with that.
Shawn:
Putting long-term needs ahead of short-term desires.
Bob:
Right. And then they are kids. So yeah. It’s okay to go spend and spend some stuff on. Well, back then we went for candy, we went for bubble gum or whatever.
Shawn:
The important stuff, the essentials.
Bob:
Exactly. Snd I think it’s important, too, to read them some scriptures about giving and saving. Some of the scriptures, y’all heard us mention many scriptures on Christian Financial Perspectives for years now, if you’ve been listening. But my favorite of course is Psalms 24:1, qnd when you teach your kids that, “The earth is the Lords and everything in it” that the dollars that they’re earning or that you’re giving them or for allowance or whatever that may be, it doesn’t belong to them or us. It’s God’s and we’re to honor that and be good stewards.
Shawn:
And it doesn’t matter if it’s $10, a hundred dollars or thousands of dollars. The principles are the same.
Bob:
They are, and they’re the same for us as adults.
Shawn:
Another great verse is 2 Corinthians 9:7 and that’s the one that talks about, “God loves a cheerful giver.” So that’s the other part in teaching your kids. The Bible says that it’s not just that you give because it belongs to the Lord, but that you should be cheerful and joyful in giving.
Bob:
Here’s the saving about Proverbs 13:11, “Saving little by little”, and consider the ant. And it even says you sluggard, it saves in the summer and stores up his provision. So, it’s saving little by little. And then we got this one, we’ve talked a lot about this one in past episodes about saving and investing.
Shawn:
No, you don’t have an investing one . You have giving and savings.
Bob:
But that’s the parable of the talents. Matthew 25, which is a great scripture. I shared that a lot with our children growing up about the parable of the talents and how they gave, God gave, or the master gave to each one according to what they knew they could handle.
Shawn:
Their ability. Could handle.
Bob:
That’s right. That’s correct.
Shawn:
All right. And I think for the investing part that’s really important is that two of the three servants did something well. Like, we don’t really know what they did, but they were able to make it grow. And then you have the last one who buried it in the ground and then he gets scolded for basically if you had just put it in the bank, you could have at least earned interest on it. I feel like that’s kind of the part of, it’s not just the savings like for emergency funds, things like that, but the investment part is a big part of it, too. Because otherwise, it’s doing nothing.
Bob:
I guess I should have had saving and down here written “and investing”.
Shawn:
Yeah, exactly.
Bob:
But I wasn’t thinking about the child investing yet.
Shawn:
Exactly. We’re not quite, it depends on the age.
Bob:
And so when you pay them and there are chores I don’t think that you should pay for. I mean, making your bed, keeping your room clean, helping with the dishes, cleaning up a after you you eat, and things like that should be expected. I don’t think you should pay a child for things that are just normal that they should do. But then there’s those outside things. And as Don and I were talking, we were talking about the outside jobs that we had as children. I remember lawn mowing at seven and eight years old, I could barely push the mower, but I was mowing our yard. And then I started mowing some neighbor’s yards. And I remember I got $5 per yard, for mowing the yard. It took me forever, and I thought I was gonna die because it was so hard. I couldn’t hardly push it. But it taught me the value. And I was making money outside of the home at that point. I remember our girls, they were babysitting. So have them…
Shawn:
I guess to summarize that, then Bob, what we’re saying is have them work for money but don’t pay them for the daily chores. So cleaning up their room, cleaning up after themselves, in the kitchen, folding their clothes, and putting them up. Those are just part of life kind of things that they need to learn responsibility and should not be expected to be paid for that. But you can let them earn an allowance or money for taking out the trash cans to the curb and bringing them back in or the recycling, depending on which day it is. The other thing would be, hey, go out and de weed the flower bed or the lawn, sweeping the porches off, washing the car. And those are things that it’s not really that they’re taking care of themselves, it’s that they’re kind of going outside of their responsibility realm and helping you with stuff that’s needed to be done. Like, that makes sense. You should pay them for that. And that way, they learn the difference between personal responsibility and actually working to earn money. Which kind of takes us into one of the other points that you had here, Bob,
Bob:
Is about paying them.
Shawn:
How you pay them. So pay them in $1 bills, all kinds of different denominations of coins, especially when they’re younger. Pennies, nickels, dimes, quarters. Because then you can help them learn extra math skills without having to use a calculator and knowing how to make change, for example. Like, it’s just good practice for them.
Bob:
It is. And when they go buy something, it is good to teach math where they’re giving them money back. So you say, okay, how much was that? That’s $1.72. Give them two $1 bills. How much should you get back now? 28 cents.
Shawn:
We haven’t gotten Rhonan, because he’s only four, I know we haven’t gotten him yet to the making the change, but we have started to have, give him money when he does certain things. Like he’s helping us around the house and helping us do stuff outside of his own clothes and whatnot. And so, we give him a little bit of money and he can go get a a little $1 Hot Wheels toy car or something like that. And he gets to give the cashier his money and get the car. He’s starting to understand that.
Bob:
It’s so cute when they’re giving that money to the cashier, you see them looking up and giving, and I remember watching my children do that, but they were understanding. Where if it’s just a debit card, if you’re putting money in the account and it’s a debit card, they really don’t understand that. But I think…
Shawn:
Here. I give them this card
Bob:
And they had the physical money and to pay them in the physical money and actually put dollar bills in here and change. And then they pull that out and they realize when they pull that out, now it’s not there anymore.
Shawn:
And that goes into our, I believe this is our last point, so helping them to create a small budget so they have the money that they’re gonna be giving to the church. They have their money that they’re saving. So maybe they’re losing that to save up for a game that they want or certain certain article of clothing. Or maybe they want to go to a movie that’s coming out soon.
Bob:
But it’s the more long term thing. Exactly.
Shawn:
A little bit longer term. And then they have the spend. Now again, that doesn’t necessarily mean they’re spending it that day, but that is going to be something that’s a little more discretionary, you know? And so, helping them understand those budgeting techniques early,.
Bob:
Remember kind of the 10-10-80 rule I call it. 10% here. So outta that dollar 10% of giving, they’re gonna put a dime there. Savings, put a dime there. And then they’re gonna put 80 cents in the spend. So they still get to go spend, but that’s a good way of doing it. And a book I would recommend is, I don’t have this in our notes, Shawn, maybe you’ve never heard of it before, but it’s called “The Richest Man in Babylon”. And it’s a great, it’s an old, old book that my dad had me read two or three times, and it was about saving and how he saved for many, many, many years. But I would encourage you to get that old book, “The Richest Man in Babylon”, because it was all about being wise with what God’s given you. We wanna raise fiscally responsible children, and you want to be the example of you being fiscally responsible as well. So we hope we’ve given you some good tools today. I think it’s a hard subject to cover, actually. because many times we’re not doing it right ourselves.
Shawn:
But I think it’s a good practice because, like you said, maybe we’re not doing it ourselves. So if you’re wanting to try to teach your kids good financial principles…
Bob:
You wanna learn those.
Shawn:
Then you need to start acting them out in your own life.
Bob:
Maybe you just need to do this yourself right now.
Shawn:
Exactly. So, that’s gonna wrap it up for today. And if there’s any other topics that you guys would like to hear us cover, we’d love to hear from you in the comments. Or, you can also if you want to let us know or if you need advice, you can call or text us at (830) 609-6986 or you can visit our website, www.christianfinancialadvisors.com. We’d love to hear from you. God bless. And thank you for joining us.
[CONCLUSION]
That’s all for now.
We invite you to listen to all of our past episodes covering many financial topics from a Christian Perspective. To make sure you don’t miss any of Bob’s upcoming episodes you can subscribe to Christian Financial Perspectives on iTunes, Google Play Music, Spotify, or Stitcher. To learn more about integrating your faith with your finances, visit ciswealth.com or call 830-609-6986.
[DISCLOSURES]
Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, also known as Christian Financial Advisors, a registered investment advisor. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host, Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 158 – Benefits Of Using A High-Tech Financial Advisory FirmBenefits Of Using A High-Tech Financial Advisory FirmWhether you live in the same city or you’re thousands of miles away, we can serve you better because of these high tech solutions!
More episodes >>
Just in the past 5 years, technology has changed immensely to allow Christian Financial Advisors to better serve clients all over the United States, not just locally. The Covid-19 pandemic really pushed the ability to serve individuals without having to meet face to face. Through Zoom and other video chatting platforms, Docusign and online document signing programs, and sharing important information all online through secure vaults, Christian Financial Advisors can serve clients no matter where they reside.
It’s so important in today’s day and age to have the ability to access paperwork, documents, and your financial advisor quickly and efficiently. All you need is internet access. Tune in to see how we are better able to serve our clients through the use of modern technology platforms AND why it’s so important to use a high tech financial advisory firm.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersIntegrative Financial PlanningBible Verses In This Episode1 Peter 4:10As each has received a gift, use it to serve one another, as good stewards of God’s varied grace.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTIntro:
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with a biblical worldview. Here’s your Christian Financial advisors host, Bob Barber and his co-host, Shawn Peters.
Shawn:
Welcome to another episode of Christian Financial Perspectives. As always, we’re so glad that you’ve joined us, whether that’s watching online or listening on one of the many podcast directories. If you do enjoy financial topics, but covered from a Christian Biblical worldview, then we would love for you to hit that subscribe button and maybe like, comment, let us know what topic you’d like us to cover in the future. And today, we are gonna be covering the benefits of using high-tech financial advisory firm or a high-tech financial advisory firm. So Bob, why don’t you give us a little intro on this?
Bob:
Well, you’re the one that’s gonna be really…because you’re the high tech guy around here. Okay.
Shawn:
Well, I try to be.
Bob:
Definitely, but I know I put the outline together and the industry has changed so much now. It’s amazing to me that when I first started 30 years ago, it was all about, your financial advisor in your local neighborhood, and you had to sit across the desk from them to do business. That is all so much changed today, especially for us at Christian Financial Advisors because we serve people nationwide and thank goodness for all this technology. So we’re gonna go through, like you say, the seven benefits. I wrote this very quickly. It’s gonna be a little bit lighthearted today, too. We’ve been covering some pretty deep financial stuff like last week was the different stages.
Shawn:
Of life.
Bob:
Yeah. And so, this’ll be a little bit lighter, but it’s a very good program for you to hear, this subject.
Shawn:
I think it’s good, too, that what we’re covering today should be helpful to you. It is descriptive of how we do business here as a firm, but we did try to present this in a way that would be helpful for people just to think about options that they might have available that, like you said, it’s changed a lot over the years. I mean, even just looking back over the last 10 years, how much things have changed. And so, with that being said, in today’s high tech world, you really no longer need to just settle for an advisory firm that just happens to be in your local neighborhood because they may or may not be able to address your needs and wants.
Bob:
Yeah. You can find whatever financial advisor will perfectly fit your wants and needs. As you know, Shawn, the way people find us is they go on the internet and they search for a “Christian financial advisor”. And that’s why we’re called Christian Financial Advisors. Which is a very, it’s a niche. There’s very few advisors in their local towns, if any, and that’s why we serve so many people nationwide.
Shawn:
Yeah. And it’s been really a blessing, Bob, to see all of the different places that people are coming to us now that the number of geographically nearby clients that we’ve been bringing on over the last year or two alone has been very, very few. Most people, I mean, we’ve been getting people from Montana and Oregon and New York state and Pennsylvania.
Bob:
We just got two last week from Michigan. So they’re coming from all over
Shawn:
Because as you said, these particular clients, they’re looking for a Christian financial advisor.
Bob:
And the technology enables them to do that today, where it used not to. So I know you have a scripture that you came up with that goes with this and share how you came up with that scripture.
Shawn:
Yeah. So I was just thinking of with technology, really, it’s a tool. You know, whether like a hammer, screwdriver or whatever, technology’s just another tool. And I know in particular, Bob, when you first brought me on or back on for those who don’t know, I worked with Bob for a number of years and then I had to go off and work in technology for a while and came back. But one of the things that you had tasked me with when I first came back on Bob said, okay, Shawn, I want you to look at what we have from a technology standpoint and figure out how can we better communicate with our clients. That was one, right. And the other one was, again, is a focus on technology, but how can we make what we do better and more efficient?
Bob:
Yeah, that’s correct.
Shawn:
And all of that really comes back down to is, is that technology isn’t meant to replace people, it’s meant to give people more tools so that we can focus on the things that really matter, like serving our clients and being able to meet with them and help them where they are and provide that advice. So I was trying to find a scripture that I thought might work with this. I found 1 Peter 4:10, “As each has received a gift, use it to serve one another as good stewards of God’s varied grace.” And so I felt like that was a good fit on with this kind of topic is that we’ve been given a gift. We’ve been given a responsibility as advisors to serve others and to help people with what God has graced them with and what God has given them. And so through the tools like technology, we can do that for people. And if someone finds that we’re a good fit for them, they shouldn’t be limited because we don’t happen to live nearby.
Bob:
That’s correct. That’s right. And there are so many benefits to working with any high tech financial advisory firm today. I’m amazed to see that there’s still quite a few that are not high tech. So Shawn, there’s seven benefits that we came up with. I know you expanded on those.
Shawn:
Little bit.
Bob:
So the first one definitely here, go for it.
Shawn:
Communication is effortless any time of the day. Because for us and any other high tech firm, you’ve got options to communicate via phone, text message. You can leave a voicemail if it’s not during business hours. You can do online face-to-face meetings through things like Zoom or go-to meeting. And then of course, good old email, and just expect, though, that this is really true for any firm, but your answers are not gonna be provided outside of normal business hours. That’s just, it’s not really fair. The people who work here, we also have families as well. The same way, if you’re not at work, you probably don’t want your boss contacting you all the time.
Bob:
But we get emails and texts all the time outside of business hours because that’s when they’re off work, they think of something I want to ask. So we get that and we…
Shawn:
Which is great. And then the very next business mornin, we can see that we can help respond to it. And so, that is kind of the nice thing of, oh, well I thought of it outside of business hours. I couldn’t jump on a call. That’s fine. Send us a text.
Bob:
Shawn, when I got in the business, and I’m looking at our list here, there was only one of these. That was the phone. There wasn’t the text, and just actual face-to-face sitting across from each other. But then again, you were limited by your location. Where today, really location doesn’t matter at all.
Shawn:
Yeah, not at all.
Bob:
And that’s just been thrown out the window. Okay.
Shawn:
Now, however.
Bob:
I do still like to meet with people. You know me, I love people. I like meeting across from the table 1 on 1 with you, if that’s possible. But 90% of the time, it’s not possible anymore.
Shawn:
So however, even though during business hours, we might not be able to respond if it’s the middle of the night or on the weekend, you can book an appointment 24/7 with online scheduling.
Bob:
Yeah. That’s nice, too. That’s a nice feature. That was never that way when I first started. Okay. All right.
Shawn:
Which kind of goes into point number two. The online and phone meetings are much easier and less time consuming when compared with traditional in-person meetings. I mean, have you ever gotten stuck in traffic going to a meeting or something like that? Yeah, it happens all of us. I mean, even if you’re only driving 10 minutes, there’s still a chance you’re gonna get stuck in traffic.
Bob:
Well, Shawn, when I first started in the business, that where we are in New Braunfels, Texas, in between Austin and San Antonio, Austin and San Antonio had not grown together as one gigantic big city now. And that Interstate 35 between Austin and San Antonio is as busy as the Los Angeles area. I mean, it’s just bumper to bumper traffic all the time. It’s a parking lot on Interstate 35. Even my clients that always used to come up from San Antonio and it’d be a 25 minute trip, now it’s a 45 minute to an hour long trip. And so, they’re deciding, instead of spending an hour coming down, an hour going back.
Shawn:
Plus the time here for the meeting,
Bob:
Plus the time here. So, you’re talking half a day. Now, I can have a 45 minute meeting through Zoom or a phone.
Shawn:
Exactly. With an online meeting, just jump in the appointment at the start time. And skip all the hassle of traveling to and from an advisor’s office.
Bob:
Which takes us to the third as we’re talking about this technology, is paperwork. Man, we used to use that printer. We barely use it now. Because paperwork is effortless and it’s digital. Now, time stamped, I like that.
Shawn:
Yep. So, all the signatures and initials, everything gets times stamped and dated for the exact day, hour, and minute that you digitally signed. And it can be totally handled through a secure email. So on the top of that, which is something I added for you, Bob, but no more missed signatures or initials or fields causing repeat paperwork. Because if you’ve ever had to do forms, especially paper forms, it happens and then you’re like, oh no, we forgot this one field or this one piece of information. Now, we can’t submit the form. So keep in mind though, just want to say for some of our older watchers and listeners…
Bob:
We can still print the paper.
Shawn:
We can still print the paper. We can do business reply mail. Any advisor you’re working with, especially if they’re not nearby, we wanna make sure that’s a good option because we might do all this stuff digitally, but sometimes we have a client that just really needs to hold it in their hand. And that’s okay.
Bob:
As we’re making this podcast right now, we know we have a client that wants to come in and see me in 20 minutes, they’re gonna be here. Across the table. So that is fine. And if you’re in Michigan or you’re in New York, or you’re in Chicago and you wanna fly down to see us, or you wanna pay for us to come up and see you, cause we are a fee-based advisor. Sure. We’ll come up. I mean, that’s not a problem getting on that plane. I’d probably send you, because I’m not that much into travel anymore, but…
Shawn:
Oh, thanks, Bob.
Bob:
Yeah, sure. I’m volunteering you right now, but that can still be done.
Shawn:
Are you man-a-teering me?
Bob:
But Yeah, exactly. But with Zoom, you’re gonna be able to see myself face-to-face. You face-to-face, our other advisors the same way.
Shawn:
And again, whether this is digital digitally signed or you did the business reply mail, no matter what it is, we always take everything that’s been signed and we scan that and put it into a secure digital vault, so you would have access to it 24/7. And that vault we call, it’s our client portal. We actually had a recent video on that, on how we do our financial planning. But that same tool allows us to also have this single repository. And one of the benefits to that is not only do you have access to signed paperwork from us, but if you have a will, your estate planning trust documents, insurance policies, there’s a lot of information that you can use that and store it in there, and then since we as as an advisory firm have access to it, now you’ve got kind of that extra security of, well what if something happens to you and you can’t find the original copies? Well, at least we could then help your family with finding that information. Or maybe you’re still here and you just can’t remember where that insurance policy was.
Bob:
Well, Shawn, by the time you see this, we’re making this before we go to Europe, but by the time we get back, we’ll have been to Europe, we’re taking our passport and we’re scanning it and putting it in there. So if we lose our passport. So, we have that we can go online and get to that.
Shawn:
So let’s go with number five. Financial planning is done efficiently online with values updated daily to reflect how they affect you in the long term as markets do change over time. So no more complex one-time reports that three months later they’re outdated.
Bob:
That’s right.
Shawn:
And there are still advisors that do that. You’ll pay $3,000 to $5,000 to develop this “financial plan”. Three months later, because values and other information change or you had a kid, like none of it’s relevant anymore.
Bob:
And financial planning like that doesn’t take near as long anymore either. Because it’s done, what I would say ‘on the fly’, I mean, I can have a meeting with you and you can be amazed at just in an hour or two how much we can accomplish. We can nearly do the full financial plan. And right then, it’s in your hands.
Shawn:
And then, all you have to do is you go in and you just change, oh, did your income change or your expenses change or you bought a property. You just kind of confirm, “Okay. Are the details correct?” And if anything’s changed or updated, you update it. Boom.
Bob:
Can we put a quick link and YouTube.
Shawn:
Yeah.
Bob:
The one on integrated financial planning.
Shawn:
We’ll put a link in description and we’ll show that on screen.
Bob:
Okay. Sounds good.
Shawn:
Right over here. Right over here.
Bob:
Okay. All right. Sounds good.
Shawn:
So number six, you have total transparency of the values in your savings, investment, and retirement accounts and their holdings online anytime of the day. Again, kind of going back to that client.
Bob:
I like that. And that creates security just for yourself. I’m doing business with a advisor that’s a thousand miles away from me, but there’s total transparency. So, there’s nothing to hide. And you can see everything that you own.
Shawn:
I would like to interject here, though. We don’t recommend that you look at it every day.
Bob:
Oh no. That’s right.
Shawn:
What we’re investing is we’re investing for multiple years or longer as far as the timeframe. So there’s nothing wrong with looking at it, but I would just say unless you’re doing it for a living, don’t look at it every single day. Cause it can be stressful because no matter what you’re investing in, there’s going to be volatility.
Bob:
And they can fluctuate by 1% to 3% per day. Yeah. So, you are correct with that.
Shawn:
And then number seven, so using online forms, you can efficiently fill out all the important information for transferring an existing account or opening up a brand new account with your advisor. And then a short phone interview can be done if needed, after.
Bob:
I know this is something you’ve been working on a lot.
Shawn:
This is something we’ve been working on. And there, like I said, it’s not just us. There are a lot of different options. So definitely something that when you’re doing your research and you’re looking into an advisory firm, see what kind of options they have. Like, nothing wrong with asking, Hey, what’s the process look like, if they don’t have it already on their site, kind of spelled out of what does that timeline look like? Because as I’m sure those of you watching or listening, there have been times where you’re real excited about something, whatever it is, but you’re really excited about getting started. And then it just feels like, ugh, I’m still having to do paperwork or I’m still having, like, I just want to be done.
Bob:
And it does make it so easy, so easy.
Shawn:
And then for us, once we get all that information in, we double check it for accuracy and then send it out via DocuSign. So just a few quick signatures and initials, and we’re off to the races.
Bob:
Isn’t that, it’s so much easier now, too. Like you say, you don’t have to send the paperwork, you can send it through DocuSign, which is a secure way to do that. And then you get that copy of that that goes right into your vault. So there you have it, there’s the seven benefits of using a high tech financial advisor. And we are that’. We’re all seven of these here at Christian Financial Advisors. You have to be actually, because we serve so many people nationwide.
Shawn:
So, if you are evaluating and your firm of choice doesn’t have all of these, I’d like to throw our hat into the ring. We do have these. So you can reach us at www.christianfinancialadvisors.com or you can call or text us during normal business hours at (830) 609-6986. We’d love the opportunity to serve you and your family. Bob, got any closing remarks?
Bob:
I just love it that location, Shawn, no longer matters. That’s a big deal. Yeah.
Shawn:
Which is great.
Bob:
Yeah, it is.
Shawn:
So come on wherever you’re at. God bless and thank you again for joining us. Bye-Bye.
[CONCLUSION]
That’s all for now.
We invite you to listen to all of our past episodes covering many financial topics from a Christian Perspective. To make sure you don’t miss any of Bob’s upcoming episodes you can subscribe to Christian Financial Perspectives on iTunes, Google Play Music, Spotify, or Stitcher. To learn more about integrating your faith with your finances, visit ciswealth.com or call 830-609-6986.
[DISCLOSURES]
Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, also known as Christian Financial Advisors, a registered investment advisor. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host, Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 157 – Summer Vacation Financial Tips and TricksSummer Vacation Financial Tips and TricksCheck out these ways to help you save money on your next vacation.
More episodes >>
Bob and Shawn break out some of their favorite financial advice when it comes to traveling. Summer is right around the corner, which means a vacation is in the works for most of us. Vacations can end up stressful and take a huge toll on a wallet.
However, if you plan ahead correctly, then it doesn’t have to be as heavy on your finances as you might have expected. From booking a place with a kitchen to staying local, Christian Financial Advisors provides some great and easy ways to help you save money on your next summer vacation – or just any vacation!
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodePROERBS 23:4Don’t wear yourself out trying to get rich. Be wise enough to know when to quit.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTIntro:
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with a biblical worldview. Here’s your Christian Financial advisors host, Bob Barber and his co-host, Shawn Peters.
Shawn:
Welcome back to another episode of Christian Financial Perspectives. Thank you so much for joining us. Whether you’re listening on one of the podcast directories or you’re watching us live on YouTube, thank you so much for being here. And if you have not subscribed, which Bob, I don’t know why, but we’re still at 80%,
Bob:
You get onto people about subscribing.
Shawn:
So we would love it if you would hit that subscribe button.
Bob:
I subscribed.
Shawn:
Well, good. Yeah, that’s good. But yeah, we’d love if you’d hit that subscribe button so you can know as soon as we post our next episode. But it really helps both the channel, but also helps other people who are looking for videos on financial related topics from a Christian perspective. So with that, we have a really serious episode for you today. No, I’m just kidding.
Bob:
it’s like…
Shawn:
It’s a little more lighthearted. With us being right in the middle of May now, we thought it would be good to do an episode on summer vacation planning, because people don’t necessarily think of that as financial, but depending on what you’re doing, it definitely might want some planning. And we just thought it’d be a good topic to cover. So, Bob, you wanna give us a little intro?
Bob:
Yeah. I don’t know about you, Shawn, but I’ve spent some big dollars on vacations with my family, especially. So I think this is definitely a financial topic.
Shawn:
And I, myself, I don’t know if there’s any other young parents out there, but I have a four year old and a one year old, and my wife and I are very firmly getting our school of hard knocks on kids can be expensive.
Bob:
That’s the truth.
Shawn:
But you don’t have to spend a ton of money to have a good vacation.
Bob:
That’s right.
Shawn:
You just gotta do a little planning and think about it.
Bob:
A lot of people are thinking vacation. What Vacation? I’m like, I need to work, work, work. Well, you know what, there’s a scripture about that, and working is good. Working’s in the Bible over 500 times, but in Proverbs 23:4, it says, “Don’t wear yourself out trying to get rich, be wise enough to know when to quit” or to take that vacation. It’s smart to take vacations and it’s good for your family and good for you. Or we call it, I like to call it a sabbatical. It’s the same, is another way to call it that. So as we think about the summer family vacation planning in the financial side of it, I think it’s good to decide on what your budget’s gonna be. Right now is that budget gonna be $1,500 or is it gonna be $5,000 and whatever that budget is, Shawn, you take that budget and this is the way I’ve done it for many years.
We take that budget. Let’s say we’re gonna go on a 10 day vacation, pretty long one. And if it’s $5,000, that’s $500 a day. Okay. Or if it’s $2,000, that’s $200 a day. So you divide that by the number of days, and that right there lets you know this is what I can spend per day for accommodations, for food entertainment, whatever you’re gonna spend your money on. Okay. And I think that’s very important, but the one thing is I want people to really understand it. It doesn’t have to have to be an expensive vacation to be a fun one.
Shawn:
That’s right. That’s right. My wife and I went on our babymoon, me and Jenna, we went to Hawaii, which seemed, oh, it’s super expensive. Well, couple things because we planned ahead, we were able to get fairly affordable flights, for one. And then the other thing is that we stayed at places that we had access within the place we were staying, like an Airbnb or something like that, or like a condo that you can rent, that had a full kitchen. So for us, we just went to wherever the the locals went, we went and got some groceries and packed us some lunches and stuff. We went out to the beach if we were gonna be hiking around and it saved a ton. Like, there are definitely ways and the benefit to that is it kept our budget under the dollar amount we wanted to stay at for the day while still being able to go somewhere really fun and nice. So, you don’t have to go out to eat for every single meal. And you don’t have to necessarily go to the really expensive places or hotels like you can still…
Bob:
You don’t have to necessarily go to Hawaii, Shawn, because one of the greatest vacations I can remember in just the last couple of years is when we all went to Garner State Park here in Texas and how beautiful that was. And all the camping. And that was a fun, fun time. And that was a very inexpensive vacation. So vacations are about family. And it’s about being together away from work. And I don’t, I never, you should never go into debt to go on a vacation. That’s just crazy.
Shawn:
Because now whatever benefit you might have gotten from that vacation, now you have the added stress of additional debt to pay that off. And I’m pretty sure when you weigh the pros and cons of that, the debt and the anxiety and the stress from that is not gonna be worth it.
Bob:
I don’t think so. Definitely not. So, one of the things you might wanna think about when it comes to vacation, maybe you have a limited budget. Maybe your budget’s just $200 or $300. Well, maybe you should consider a staycation. That’s what we call a staycation, where you find all kinds of fun things to do within a 1 to 50 mile radius around where you live. I mean, we live in Central Texas in between Austin and San Antonio, and there is so much to do. Within an hour of here, all the stuff in San Antonio, all the Missions, there’s the Six Flags amusement park, if you want to go to that. Right here in our own town, you can go tubing on the rivers.
Shawn:
There’s this really small waterpark that some people know about that, oh, sorry. I believe it’s one of the largest waterparks in the world.
Bob:
In the world. Yeah. It’s called Schlitterbahn.
Shawn:
That’s a huge savings because if you’re staying within that 50 mile radius to find things to do, you can pretty much do something different each day. You still stay at home each night. So, it completely cuts out that extra cost for lodging, and you can have a great time together as a family.
Bob:
That’s exactly right. And there’s so many inexpensive things to do in a local area, or even if you’re going far off. Rachael and I have really come to love hiking and walking nature trails. And around here in Texas, there’s just multiple state parks. But state parks are around the nation.
Shawn:
Oh yeah. Well, and of course there’s national parks, too.
Bob:
Right. Exactly. Overnight camping trips are not very expensive, but even camping out in your own backyard, did you ever do that before?
Shawn:
Yeah, I did that with with some friends when I was younger. But that, yeah, that could actually be really fun. That could be fun, especially if your kids are younger. I know when they’re teenagers, they don’t want anything to do with you. At least, so I’ve been told but when they’re younger, you could definitely do a camping trip in your backyard.
Bob:
Yeah, that’s right.
Shawn:
And the added benefit is once the kids go to sleep, y’all can go sleep inside in the regular bed.
Bob:
Or just going fishing in a local lake or pond, river or bay that might be around you. I mean, that’s very inexpensive. Like I said, water tubing just sitting on the beach enjoying a campfire. You could do even make your own little campfire in your backyard and make…
Shawn:
Follow all your local fire codes.
Bob:
Of course. Of course. We don’t want you burning down a forest. Okay. but in making things like s’mores and barbecuing and having watermelon, that’s a big thing here in Texas. We like to have watermelon during the summer. Maybe that’s a tradition across the nation. I don’t know.
Shawn:
I had watermelon growing up too. So we can’t claim that as a strictly Texan thing.
Bob:
Exactly. So one of the things when you’re planning for that summer vacation is really thinking about those accommodations, like you said, like when y’all went to Hawaii. You might wanna spend a little bit more to get a place with a small kitchen in it.
Shawn:
That’s right.
Bob:
Because you’re gonna save so much money on eating out. Eating out is just so expensive. Plus, you don’t have to mess with the crowds.
Shawn:
Yeah. And then you’re spending more time waiting around for food, too. Whereas for us, we made breakfast at, at the place we were staying right there in the kitchen, and then we would pack some snacks and sandwiches and other stuff to have for lunch as well, which was great because then we got to spend more time out and about not waiting for food. We didn’t have to spend as much on the food. We could actually spend more time enjoying the vacation and not sitting in a restaurant, which you can do anywhere. And then a lot of times, for the evening, we may not want to make something. So, we’ll grab something out and about in at night. But yeah, that definitely makes a big difference.
Bob:
Okay. So we’ve talked about that staycation, we’ve talked about budgeting. So there are the big trips, right?
Shawn:
Like you said, gotta cover the big trips.
Bob:
The Hawaii trips, there’s the trips to Disney for later.
Shawn:
Or insert your local theme park, whether it’s Disney or Six Flags or whatever it is.
Bob:
But budgeting for these times is the most important thing you gotta remember. And you really wanna try to stay away, I’ve noticed this, stay away from weekends. Weekends, especially in the summer, the prices will double around major holidays too.
Shawn:
Well, what do they call that? Surge pricing. Don’t go then.
Bob:
Then we’ve had some vacation properties as you know and we don’t even stay in them, like July 4th. You can nearly get triple what you’re getting normally. So we just, we don’t even go, we’re like, this doesn’t make sense for us to stay in our own place on July the fourth or Memorial Day.
Shawn:
Well, especially if it’s somewhere that gets super crowded. Because even if you have your own place to stay, do you really want to go there to fight the crowds when everyone is trying to go there? It’s just not worth it.
Bob:
We have so many tourists here in New Braunfels, we call them, we end up calling them terrorists in the summertimes . But they’re not terrorists. They’re tourists. They’re great people. They’re sweet people. But it gets so crowded. It just, I mean, we swell in population by over a hundred thousand. And look for those deals, they’re everywhere to be had and on sites like VRBO, Airbnb, Expedia, direct hotel sites. Another thing, a little trick I’ve done, Shawn, is if you look on the VRBO sites or even Airbnb, they have a lot of layered extra costs on there. Well, if you look real, real close, you can find that property, do a little research, and a lot of times the property managers will actually put their properties on the VRBO websites or the Airbnb where they charge all those extra fees. If you go directly to the property manager or directly to the owner, you can bypass those enormous fees. So many times I’ve gone on, like a VRBO website, and it says $200 a night, and by the time I’m done with all the fees, it’s like $375 a night. I’m like, how did that happen. But by doing some research, I was able to find the actual owner or the property manager, go direct.
Shawn:
Even if you can’t find the owner. One of the things that Jenna and I have noticed when we travel, we’ll go to a place that’s technically a bed and breakfast or just a normal Airbnb. Almost always, they will have contact information or they’ll have a card or you get to meet them in person. They’re like, Hey, by the way, here’s my website. Here’s my information. If y’all want to stay here again, contact me directly, it’ll save you 20-30%. And then now that you’ve got that relationship established, well if that’s a place you really like going, you’ve got a great place to stay. You know it’s nice, and you’ll save quite a bit of money on those fees.
Bob:
The BnBs we’ve stayed in, we can actually, they’ll negotiate as well. Especially if you’re staying over two nights or over three nights, maybe one night you’re not gonna get to negotiate, or two. But if you stay, especially three or longer, many times I’ve gotten 10% or 15% off the price.
Shawn:
I’d like to mention one other thing too, Bob. Okay. So if you’re looking at doing a cruise, because I know a lot of people do that. I will say I like to eat. So I definitely like the idea of the cruise because I can eat as much as I want.
Bob:
So you’re the reason the cruises run out of food.
Shawn:
Yeah. I’m that guy. But on the cruise is one thing that I’ve found is really helpful. And if you’re like, oh, I already knew this, then this isn’t for you, but don’t worry about getting that nice ocean view room. You’re not gonna be in there. Because if it’s a fun cruise, you’re basically gonna sleep in the room and change every so often. Or maybe take the kid to the bathroom, whatever. But you’re hardly ever gonna be in there. Don’t waste money that you could have spent on excursions or fun stuff like when you actually get off the boat or even some of the cruises. I mean, it’s crazy. It’s a floating city with the kind of stuff that you can do actually on the cruise. So, save that money for actually doing something fun. Not on a slightly better view.
Bob:
I don’t know. Now, I like that better view, Shawn. But anyway.
Shawn:
Hey, I’m just saying it’s an option.
Bob:
It is. You’ve got an option. If you’re on a budget.
Shawn:
You’ve got a certain budget,
Bob:
You’ve got a certain budget.
Shawn:
You can either spend more on the room or you can spend more on doing other stuff.
Bob:
That’s right. That’s right. Well, there you go. I’m hoping that all of y’all have a great family vacation or staycation. Shawn, some of the happiest people I see is when I go over here to our park here in New Braunfels, Landa Park, which is like a little Garden of Eden with the springs coming out in the beautiful clear lake. You see they’re having such a great time. And many of them, they live right here. And they’re staying right in their own hometown and they’re having the barbecues and I’m thinking they got it right. They got it down.
Shawn:
Well, ultimately it comes down to it’s the people that you’re with. And if you’re taking your family, just focus on having fun and enjoying your family. And don’t worry about whether or not you’re spending enough or you’re getting this dream vacation. Because at the end of the day, especially for your kids, like the stuff I remember growing up, it wasn’t the expensive things. It was when I got to have quality time with my parents, with my family. That’s what sticks with you. So your kids want to spend time with you more than they just wanted something fancy.
Bob:
That’s correct. You got it. Well, I hope this has been insightful. It’s been a little light today. We didn’t want to get too heavy. We do that every week on the financial topics. We got our next topic, by the way, is coming up is gonna be a lot of fun. Either the next one or the following week is gonna be on teaching your kids good money habits. So yeah, that’s gonna be a real good one, kind of a lighthearted topic, but at the same time, one that you wanna definitely listen to if you have children or even grandchildren.
Shawn:
Yep. Well, hey Bob, we gotta teach the meat and potatoes, but every once in a while we’ll do some chips and queso.
Bob:
That’s right. There you go. Everybody knows what that means when you say South Texas chips and queso.
Shawn:
Chips and salsa, guac, or some spinach dip, whatever it is where you’re at.
Bob:
Yeah. Right.
Shawn:
All right. Well, God bless, thank you so much for joining us and hope to see you next time.
[CONCLUSION]
That’s all for now.
We invite you to listen to all of our past episodes covering many financial topics from a Christian Perspective. To make sure you don’t miss any of Bob’s upcoming episodes you can subscribe to Christian Financial Perspectives on iTunes, Google Play Music, Spotify, or Stitcher. To learn more about integrating your faith with your finances, visit ciswealth.com or call 830-609-6986.
[DISCLOSURES]
Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, also known as Christian Financial Advisors, a registered investment advisor. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host, Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 156 – Life’s 6 Financial Stages Part 2Life’s 6 Financial Stages Part 2In part 2, discover the last 3 life stages and how you can try to accomplish more with your money during this time.
More episodes >>
In part two of two, Bob and Shawn discuss the last 3 of 6 financial life stages based on finances, lifestyle, and age. We have advice and recommendations for each stage of life, especially when it comes to financial planning during this time. Not everyone will fit exactly into these 6 financial life stages, but you will find common factors in most of them! From starting a new family to coming into retirement, there are key takeaways here for everyone.
All of our advice comes from decades of experience with clients at Christian Financial Advisors. For these last 3 life stages, this includes everything from having a trusted power of attorney to investing more conservatively in your older age. Listen in to discover which financial life stage you are currently in and how you can get a better handle on your finances!
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersLife’s 6 Financial Stages Part 1Bible Verses In This EpisodeECCLESIASTES 3:1-7There is a time for everything, and a season for every activity under the heavens: a time to be born and a time to die, a time to plant and a time to uproot, a time to kill and a time to heal, a time to tear down and a time to build, a time to weep and a time to laugh, a time to mourn and a time to dance, a time to scatter stones and a time to gather them, a time to embrace and a time to refrain from embracing, a time to search and a time to give up, a time to keep and a time to throw away, a time to tear and a time to mend, a time to be silent and a time to speak
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
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EPISODE TRANSCRIPTIntro:
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with a biblical worldview. Here’s your Christian Financial advisors host, Bob Barber and his co-host, Shawn Peters.
Shawn:
Welcome to another episode of Christian Financial Perspectives. We’re so glad that you joined us. If you’d like financial topics from a Christian perspective, we’d love for you to hit that subscribe button that’ll help us out, but it’ll also help other potential viewers and listeners to find this kind of content. Now, today we’re gonna be covering part 2 of 2for Life’s six financial Stages. And if you haven’t seen the first episode, we covered the first three stages ranging from your twenties to your late fifties. So link is in the description, or you can click the video should be over here on screen. And so with that, let’s get into the next 3 of 6 stages, and Bob over to you for that.
Bob:
Yeah. So here, I’m in this fourth stage that we’re gonna be discussing. We’re gonna discuss stage four, five, and six today. All right. And that fourth stage is from your early sixties or 60 years old. And I turned 60 Yeah last year, from your sixties to your mid seventies. I call this the retirement and traveling years. I wonder why I would call it the traveling years?
Shawn:
Well, let’s not get ahead of ourselves. You wanna read the scripture or you want me?
Bob:
I think the scripture is good to read because this scripture, we read this last week, is because it really talks about life, doesn’t it? So, go ahead, Shawn.
Shawn:
We’re gonna be reading Ecclesiastes 3:1-7, “A Time for Everything”. Verse one. “There is a time for everything and a season for every activity under the heavens. A time to be born and a time to die, a time to plan, and a time to uproot, a time to kill, and a time to heal, a time to tear down and a time to build, a time to weep, and a time to laugh, a time to mourn and a time to dance, a time to scatter stones, and a time to gather them. A time to embrace, and a time to refrain from embracing, a time to search and a time to give up, a time to keep, and a time to throw away, a time to tear and a time to mend. And finally, a time to be silent and a time to speak.”
Bob:
Huh? That scripture says a time to throw away. In this stage four, that could be a time to start throwing away some of that junk you’ve accumulated in those first three stages. Because it’s during this stage where you become a empty nester. Many times, the children are on their own now. At least you hope they are. This is the retirement points during the sixties sometimes, or it may be even in mid seventies now. I’ve decided I’m not gonna retire till I’m 85. So my wife says, no way are you retiring.
Shawn:
Well, you’re not gonna retire in the traditional sense of completely stopping work. Because mainly you would just go, you would get bored outta your mind.
Bob:
I would. Exactly. I love producing stuff, producing this podcast. I love writing. But you talk about the traveling years. Rachael and I are starting to do that. By the time this comes out, we would’ve just gotten back from a Europe, a trip to Europe, which I’ve never been to, and it’s gonna be really fun to go to. I’m looking forward to that. But we are empty nesters, and it’s major traveling years. And it’s not only Europe, but I see the RV happening during this time for my retirees and visiting friends and family. There’s a lot of…
Shawn:
It’s a lot traveling.
Bob:
Yep. This is where the downsizing to probably a smaller home sometime from the sixties to the mid seventies and possibly a retirement community. We got that one between here and San Marcos, which we’re between Austin and San Antonio, called Kissing Tree. It’s gotta be 55 and up to live in there. So on a golf course, it’s got all the pickleball…
Shawn:
Downaizing for something easier to take care of or just hanging out with the other people in that stage of life. You’re gonna get more time with the grandchildren. Hopefully. And at this point if you haven’t already had some health issues, this is usually when those just normal wear and tear health issues, if you will, start popping up. And that’s just part of life, right, BOb?
Bob:
Yep. Exactly. So I have seven financial takeaways on each stage, just like we did last week. We have financial takeaways during the during that stage. So, good financial advice during this point is more important than ever. I mean, this is very important during this point, this stage, because the biggest concern is running out of retirement assets before life ends. And you gotta be very careful about overspending in the beginning years of retirement. There’s that tendency, I’m gonna go travel, travel, travel, I’m gonna buy that RV, and then all of a sudden, what happened to a third of my retirement? I’ve seen this happen from being in the business for years. Debt. It is not to be tampered with at all at this age.
Shawn:
Don’t mess with her. Don’t.
Bob:
Yeah, exactly. Just stay away. Stay away from her. Possibly downsize to a smaller home to lower expenses. Buy the best health supplement plan you can get. I promise you’re gonna be glad you did. I’m brought into a lot of my…when it’s the Medicare, Medicaid, and the supplements, get that best supplement that you can,. Number six.
Shawn:
Update your estate plan for both your spouse and your children’s sake. Because again, you don’t want something to happen and that estate plan to be outdated or non-existent, I mean, hopefully you do have an estate plan, but if you don’t get one now.
Bob:
And that’s amazing. If you don’t have one by now, but hopefully.
Shawn:
It happens, though.
Bob:
I know it does. I see it happening all the time. Number seven, sell off those unneeded assets that cost unneeded money or make low returns. I would really invite you to go back and listen to podcast number 129 if you own rental homes.
Shawn:
That’s right. It’s the one, “Are rental homes a good investment?”
Bob:
And the yield of the rental home after taxes, insurance, and maintenance is no more than about 3% or 4%. You can make that in a CD today. And so I really think that’s a good example of, to unload those assets, if you got several rental homes.
Shawn:
So go back again, that’s episode 129, and then the last financial takeaway, make sure you build a diversified portfolio that can keep up with or overcome inflation, but be sure that you are limiting your risk as much as possible so there, there’s a balance to that.
Bob:
Right? There is. But still, you gotta keep up with inflation. You just can’t go all the way over to the left, super, super conservative. You still have need to have some in a moderate portfolio.
Shawn:
Stage five, the slowing down years.
Bob:
Yeah. Now it’s like, okay, I’ve done my traveling and actually the cost during this retirement stage goes way down. Now it’s gonna go up in that last stage because of health costs, but the health cost goes way down, but the health issues, they just start popping up left and right, and that’s sad. But they do.
Shawn:
So again, stage five, the slowing down years from your mid seventies to your mid eighties, your health issues start popping up. There’s less travel, if any, because it’s just harder, possible loss of a spouse.
Bob:
Happened with my mom. My dad passed away when my mom was 80 years old, actually. My dad was, was 83-84.
Shawn:
The next one you might be selling the last home. Your last home. And primary home.
Bob:
I’m thinking about my mom and she’s 88 now, and she did a couple years ago. She sold her last home.
Shawn:
And moved into assisted living.
Bob:
That’s correct.
Shawn:
Which is also pretty common, especially by mid eighties.
Bob:
By the way, because she’s so social, she’s doing something every day. She has a meal with all of her friends. It’s a great, great place.
Shawn:
Got her bridge club, right?
Bob:
Yes, she does. Exactly. And they play dominoes, and they even have a miniature golf course there.
Shawn:
Mini golf?
Bob:
Oh yeah. It’s nice. It’s amazing. It’s amazing. So financial takeaways, there’s a must have, again, for a trusted financial advisor to help you make those wise decisions during this stage. And the second thing that’s really important is that you need a younger, trusted family member to help with those financial decisions.
Shawn:
Preferably something like limited power of attorney, just in case maybe there’s a health issue to where you’re not able to voice your concern. So having that trusted younger family member being able to be empowered to help you with those decisions. And the other thing, too, that, you know what unfortunately happens, but as you get into this stage, the chances of of memory issues occurring also go up drastically. So that’s again, another part of having that trusted family member, because you might be great, and then next month, all of a sudden, you just can’t remember what’s going on with finances.
Bob:
Yeah. And the financial takeaway, which you talked about, you end up doing anyway, is that you sell that home, and it helps with the financial cost of this, we’re using the sale proceeds from my mom’s home to help offset offset the cost. And we have all her estate planning documents updated, and we’ve got a great power medical power of attorney, financial power of attorney. It’s so important that you have that trusted family member to help you with these items.
Shawn:
Which is our number four of four for these financial takeaways. All your estate planning documents need to be updated. And like we were just saying, a good suggestion is have a medical power of attorney and a financial power of attorney in place with that younger, trusted family member.
Bob:
Now we get to stage six, if you’re lucky enough to make it this far.
Shawn:
If you make it this far. Congrats.
Bob:
Exactly.
Shawn:
You won. You made it to stage six. Not all of us get to this part.
Bob:
Right. Which is the mid eighties to mid nineties and to a hundred. Oh, by the way, I went to see my mom this weekend, and they were having a person there having their 100th birthday. And I just, you wanna sit down with somebody like that and talk to ’em. I mean, you think about that. This is 2023. They were born in 1923. They went through the Great Depression and they’ve seen life change so much. I can’t imagine. Here’s what I say. You’re hanging on, you’re hanging on for dear life at this point.
Shawn:
Well, let’s make sure we cover it. It’s stage six, the no-go or assisted living years. It’s starting The mid eighties to mid nineties, maybe a hundred if you live to a hundred. And like you said, the first one hanging on for dear life.
Bob:
I’m sorry. And I don’t mean to offend any of you, my clients that are in this stage, and I got some clients that are at this age. But they have, they’ve had a few things happen. It’s very close, you know. It’s on the edge. But what’s interesting is, is the few clients that we have they’re actually living with a family member not in assisted living like my mom is.
Shawn:
Typically, it’s gonna be one of these two, though. It’s either assisted living facility at this point of some kind or living with a family member.
Bob:
I actually had a client that was living in assisted living and then the family member built them a really nice little bungalow off the back of the house. All right. Major health issues are very likely at this stage, short-term memory loss may be occurring. And of course, you got a lot of great grandchildren coming along.
Shawn:
Possibly loss of hearing and eyesight.
Bob:
Starting that with me.
Shawn:
That’s okay. You’re not quite into this.
Bob:
Exactly. I’m a long ways from there. So hopefully they’ll have ear replacement by then, you know?
Shawn:
Yeah. May even get a new ear.
Bob:
Put a new ear in. All right. So financial takeaways. If the assets have not run out yet, invest conservatively to moderate at best. You don’t have anything, nothing to do with growth unless those are assets that you’re gonna pass down to the next generation. Now we have some clients that are multimillionaires and they’ve put aside $100,000 or $200,000 for the grandkids, and that is in growth, and they wanna be there.
Shawn:
But if it’s assets that you’re using for yourself to take care of your needs – conservative to moderate. Otherwise, if it’s going to the next generation…
Bob:
Because you may need to reach into that because the health issues can be very costly.
Shawn:
Which is number two, health issues can be costly.
Bob:
That advisor relationship, that financial advisor relationship is very important along with the trusted child or grandchild that’s handling finances. And Shawn, I think it’s very important that that trusted child or grandchild have the relationship with the financial advisor that their parents are using. Does that make sense?
Shawn:
Yes.
Bob:
All right.
Shawn:
Or a grandparent depending on which one it is.
Bob:
Right. And these financial accounts at this point, I feel should be in a trust or definitely have state of beneficiaries payable on death to avoid probate. But I like the trust part because it makes it so much easier to have a trustee, and a trusted child or grandchild needs to have a complete financial power of attorney to act on the behalf during this stage. All right. Whew. So there you go. There you go. So there you have it. We’ve gone through six financial stages of life from the beginning years in the twenties to the growing years in the thirties and forties to the maturing years to the retirement and traveling years, which is stage four. We covered that today. The slowing down years, and then the no-go years. It’s quite a life if you’re blessed with all six stages and each stage has very different issues and needs that is in need of a well qualified, financial advisor that has the experience to guide you through these stages and understands them.
Shawn:
That’s right. So if you have watched this or listened to this and you’re thinking, I like how Bob and Shawn were talking about it, we’d love to hear from you. You can comment. You can also visit our website, www.ChristianFinancialAdvisors.com, and during business hours Monday through Friday, you can call or text us at (830) 609-6986. We’re here to serve. And thank you for joining us. Bob, do you have any final words?
Bob:
No final words. There’s enough there. We’ve had a lot of words these last two.
Shawn:
We have.
Bob:
So, we’ve laid a lot on our listeners and watchers.
Shawn:
Well, that is true. May God bless you. Thank you so much for watching or listening to this and for sticking through it, and have a wonderful day. Bye-Bye.
[CONCLUSION]
That’s all for now.
We invite you to listen to all of our past episodes covering many financial topics from a Christian Perspective. To make sure you don’t miss any of Bob’s upcoming episodes you can subscribe to Christian Financial Perspectives on iTunes, Google Play Music, Spotify, or Stitcher. To learn more about integrating your faith with your finances, visit ciswealth.com or call 830-609-6986.
[DISCLOSURES]
Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, also known as Christian Financial Advisors, a registered investment advisor. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host, Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 155 – Life’s 6 Financial Stages Part 1Life’s 6 Financial Stages Part 1Discover which financial life stage you are in and how you can try to accomplish more with your money.
More episodes >>
In part one of two, Bob and Shawn discuss the first 3 of 6 financial life stages based on age, finances, and lifestyle. Even though not everyone will fit into these 6 financial life stages, most of us will! Whether you are in the beginning stages of just graduating college or towards the middle with kids that are graduating college themselves, there is definitely something for everyone in this episode.
Within every life stage are key financial takeaways and recommendations that Christian Financial Advisors has been able to extract from each. Some of these include avoiding debt, saving for a new home, and even getting your life insurance in place. Listen in to discover which financial life stage you are currently in and how you can get a better handle on your finances!
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodeECCLESIASTES 3:1-7There is a time for everything, and a season for every activity under the heavens: a time to be born and a time to die, a time to plant and a time to uproot, a time to kill and a time to heal, a time to tear down and a time to build, a time to weep and a time to laugh, a time to mourn and a time to dance, a time to scatter stones and a time to gather them, a time to embrace and a time to refrain from embracing, a time to search and a time to give up, a time to keep and a time to throw away, a time to tear and a time to mend, a time to be silent and a time to speak
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTIntro:
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with a biblical worldview. Here’s your Christian Financial advisors host, Bob Barber and his co-host, Shawn Peters.
Shawn:
Welcome to another episode of Christian Financial Perspectives. We’re so glad that you joined us today, whether that’s on YouTube or listening to us right now in one of the many podcast directories. If you like content on financial topics of all kinds, but from a Christian or biblical worldview, we’d love for you to hit that subscribe button. Maybe like this video, it’ll bring more content like this to the top of your subscription feed, but also it’ll help other people who might be looking for the same kind of content. Don’t ask me how the algorithm works, I just know that it works. So anyway, today we’re gonna be covering part one of two for a series on life’s financial stages. And gonna go over to Bob for a little bit more of an intro on this.
Bob:
Well, Shawn, we’re gonna go over life’s six financial stages. I’m the old guy here, so I’ve already gone through three of them. I’m starting to head into my fourth. So, I’m over that halfway mark, I guess. I’m starting to come to that reality.
Shawn:
I’m firmly in stage two now.
Bob:
You are. So, yeah. And I think everyone’s going to relate to this, whether you’re in your twenties, thirties, forties, fifties, sixties, seventies, eighties, or even nineties. If you listen to our podcast.
Shawn:
If you’re in your eighties or nineties listening to our podcast, we appreciate you.
Bob:
Yeah, exactly.
Shawn:
You’re still going strong.
Bob:
You’re a high tech grandma.
Shawn:
That’s right.
Bob:
Watching us on YouTube or listening to us on our podcast. But Shawn, we do. We have some clients that are that age and they listen to us. So I gotta be careful about how I speak on this last stage.
Shawn:
It’ll be all in love.
Bob:
Yeah, exactly. That’s correct. And as we were thinking about these financial stages, you know what, some of the scriptures we use, sometimes we use them, a lot of them, over and over, but they apply. And I think the scripture from Ecclesiastes 3:1-7 really does apply through this about how there’s a time for everything.
Shawn:
You want me to go ahead and read that?
Bob:
Yeah. If you’ll read that for us.
Shawn:
So, like Bob said, Ecclesiastes 3:1-7 starting in verse one, “There is a time for everything and a season for every activity under the heavens. A time to be born and a time to die, a time to plant, and a time to uproot, a time to kill, and a time to heal. A time to tear down and a time to build, a time to weep, and a time to laugh, a time to mourn and a time to dance, a time to scatter stones, and a time to gather them. A time to embrace and a time to refrain from embracing, a time to search and a time to give up, a time to keep, and a time to throw away, a time to chair, and a time to mend, and a time to be silent and a time to speak.” Now, obviously, Bob, there’s probably something in there for everybody.
Bob:
There is, that’s right.
Shawn:
One part of that probably speaks to you, but I do know that very last part, probably for you and me, is a little hard sometimes, knowing when to be silent and when to speak.
Bob:
There’s reason we have two ears of one mouth, right?
Shawn:
Yeah. We seem to err on the time to speak probably more than anything else.
Bob:
Exactly. So, let’s get to stage one. What we call stage one in the financial planning process, and we look at this stage, and this is when you’re in your twenties to around your mid thirties.
Shawn:
Stage one, “The Beginning Years”.
Bob:
“The Beginning Years”. That’s the name of the stage that we named it. The beginning years. It’s your lowest earning years. You have very little to any savings or investments during this time.
Shawn:
Right outta high school kind of age up until mid thirties.
Bob:
Yeah. You’re getting outta college too, and you’re finding that spouse and getting married usually between the mid twenties and mid thirties nowadays. Now, Shawn, I know that your generation does everything later than my generation did. Rachael and I, we were having all our children in our mid twenties and down. So, this is very different, but I had to bring this to today. All right? There’s multiple jobs trying to figure out the best path for the career, you know? You see that.
Shawn:
Even if you went to school, sometimes you’re still trying to figure out what actually works.
Bob:
And you may not realize it, but your expenses and income, well you know your income’s low at this point. But you may not realize it, but your expenses are low, too.
Shawn:
Especially life insurance. It’s real, real inexpensive during that period.
Bob:
It sure is. But auto insurance can be a little higher.
Shawn:
It can be.
Bob:
Yeah. And anything that can be invested for retirement, will have many, many years to compound. And that’s the key here of looking at this, because we’re gonna get into each one of these and now we’re gonna get into the financial takeaway.
Shawn:
So for each stage, if this is the one that your ears perk up a little bit because you realize, oh, that’s the stage I’m in right now. We’re gonna have some financial takeaways. So something for you to be thinking about, trying to apply and use within your own life during this stage.
Bob:
Since this is a financial podcast.
Shawn:
Exactly. We figured it’d be good to have this. So the first financial takeaway on stage one, so your twenties to mid thirties, number one is start with a savings account for emergency savings. So what you want is you want at least three months of your expenses saved up. So in case of an emergency, you aren’t having to dip into anything. You might have started saving up for investing.
Bob:
And you don’t have to get in that credit card debt.
Shawn:
Exactly. And you can avoid that debt.
Bob:
It’s easy to get in that.
Shawn:
Now, minimum is three months, but we do recommend six months if you can get to that. And there is kind of an upper limit if you’re getting to where you’ve got 12 months of savings and emergency funds saved up, you’re probably doing overdoing it a little bit.
Bob:
I don’t think anybody’s gonna need to worry about that.
Shawn:
No, not during this stage.
Bob:
Mid twenties and mid thirties.
Shawn:
The second one. This is after you’ve got your emergency savings, not before, you want to start saving up as much as you can in maybe a separate, put it in a separate savings account to maybe use for down payment on a house, or maybe if you decide to go back to school and get your master, whatever it is. But the most common is saving up for a down payment on a house, because that’ll definitely help you in the long run. And then number three, like Bob was mentioning earlier, at this age, there’s a lot of time for that compounding…
Bob:
Compounding to occur.
Shawn:
Exactly. So open a growth mutual fund and add to it monthly, even if it’s $50 to a $100 a month, it’s still is good. Just start with something.
Bob:
Don’t think of it like a $100 a month pay, think of it like $3 a day.
Shawn:
That’s a good way to think of it.
Bob:
And the reason I say that, and I love my old friend Dave Ramsey from Financial Peace. That’s the cost of a, what do y’all call these, lattes?
Shawn:
Yes. You know. Come on. You know the word for lattes.
Bob:
Well, not really. I don’t drink that expensive coffee, but…
Shawn:
I don’t either.
Bob:
It’s a different language. But anyway, you can come up with that. A lot of people don’t think you can come up with $100 a month, but you can. You just have to look, curb your spending, and categorize it to more important things. And you’re gonna be glad you did this. A good rule thumb is to set aside 50% of your savings into a savings account and 50% into that investment account.
Shawn:
Okay. So, maybe for you, maybe when you look at your cash flow, you look at your budget and maybe you’ve got $500 a month max that you can put away, well, you want to put all that $500 to build up your emergency savings. Once you’ve got at least three months of the emergency savings, then you want to split it where you split that 50/50 and you put half of that for saving up for, say, that down payment and you put half of it into the investment account.
Bob:
And you want to avoid the use of debt, please hear me on this. I could say this 50 times, you’ve got to avoid the use of debt because these credit card balances are just such high interest.
Shawn:
Especially credit cards. So it’s not just debt, but avoiding…using a credit card…
Bob:
But right now, do you know the interest rate? I saw it recently. It’s 27%.
Shawn:
It’s up to 27.
Bob:
So, this is crazy. We better get going on these.
Shawn:
Just some clarification, Bob. But on the credit card, the key here is we’re not saying that don’t ever touch a credit card. What we’re saying to be very, very, very careful of is do not spend any more than you know you will be able to pay off in full every month. Because what gets you is carrying that balance over to that next month.
Bob:
I always say, if you can’t afford it now, what makes you think you’re gonna be able to afford it in three weeks.
Shawn:
Exactly. And then the last one for this stage, get your insurances in place. So life insurance, health insurance, disability insurance, all of those are incredibly cheap at this age. So, do it now.
Bob:
Now somebody’s just listening to this, in their twenties to mid thirties, they just went, are you crazy? I don’t have an extra dime. This is where they need financial advice. And you do, you don’t realize, do you think it’s tough now in your mid twenties to mid thirties, you just wait, it’s going to get a lot more expensive.
Shawn:
This is where you establish those good disciplines, and I think the key with that is look at what you’re making and look at what you have to spend money on so you can establish that budget.
Bob:
Okay. So let’s get to stage two and let’s list these off quickly or we’re gonna be here for the next 45 minutes.
Shawn:
We won’t do that to you guys. All right. So, stage two, “The Growing Years”.
Bob:
And that’s between, that’s when you’re in your mid thirties to forties. This is where you are right now, Shawn, and your earnings are increasing. This is normal.
Shawn:
And debt is increasing.
Bob:
And because your friends, you tell me how much your friends are earning and I’m like, yeah, really? But debt is increasing, too, because of housing. You just got the large vehicle, because you’re a growing family. You’re upsizing to those bigger cars to carry the kids and a larger home to house them in. Wait, Shawn, you’re not even there yet, but you’re about to get there. Your kids are gonna start getting involved in all these extracurricular activities. You’ve got a son and a daughter. So you…
Shawn:
There’s gonna be a lot going on.
Bob:
And there’s gonna be a lot. I mean, I got soccer, football, baseball, softball, basketball, music, band, ballet, art, swimming, gymnastics, cheerleading. Have I made your head spin enough here? Because they’re gonna be involved in one or two of those areas. And it is costly. It’s very costly. We called them back then, in my day, we called them suburban moms. I mean we had the big suburban back then, and Rachael was just going around from one to another to another. We had the big band family vacations. That’s all coming down the pipeline. And snow skiing in the mountains, they’re gonna want to go do that. You’ve got the summer vacations, the entertainment parks. That can be really costly. Go for the camping trips. I got camping trips.
Shawn:
Exactly.
Bob:
That’s a lot cheaper.
Shawn:
Well, that’s Jenna and I’s preference anyway. And it’s less expensive. So that was a lot to hit you with. But key here is earnings are going up, but usually the debt and expenses and just the cost of running the family is getting more expensive. Let’s do some financial takeaways.
Bob:
Real quick.
Shawn:
You may need to play some catch up. If you’ve been procrastinating up until this point, and you didn’t hear this podcast before you wer in this stage.
Bob:
If you’ve not done already, build up at least three months of living expenses into a savings account for emergencies only and to prevent dipping into investments accounts.
Shawn:
That’s right. And the third one, continue contributing to a growth fund or open one if you haven’t already. And add to it monthly. Now, the amount needs to be much higher than in that previous stage, stage one, the beginning years, because you don’t have as many years, on average, until retirement.
Bob:
Number four, max out the contributions to your employer sponsored plan to at least their match. Okay? For example, so if your employer is matching up to 3% of your salary into the employer plan, you put at least 3% because you’re getting a double on your investment immediately. If you’re putting in $100 and they’re putting in $100, that’s like free money. You’re making 100% return immediately. Number five.
Shawn:
Number five, continue to avoid the use of debt, especially again, especially carrying a balance on a credit card. What, it’s up 27%, right? But debt for a home purchase is okay. Just be sure that your monthly house payment is no more than 28% of your gross household income.
Bob:
You were asking me about that. And that’s the old school, by the way. That’s the old school. So you take…
Shawn:
Keeps you safe.
Bob:
So you take your monthly and you multiply that times 28%. That should be the max of your house payment. And then the maximum amount of all debt, monthly payments, credit card debt, home home debt, vehicle debt, should be no more than 33%. Now, that’s conservative. I realize that. Conservative. I’ve heard some people say 50%. That is strapping you. That’s way, way too much.
Shawn:
So, key with that Bob, is that’s the goal, right? We understand maybe you can’t get to there right now, but that’s the goal is you want to keep no more than 28% for the house payment and no more than 33% for all debts combined. And then number six, update your insurance policies to reflect current liabilities and income. So again, life, health, disability insurance is still relatively cheap at this age and in this stage of life. Again, with the growing family, there’s a very high chance that you’re gonna need higher coverage, especially for that life insurance and the disability. Because if something happens to you, you wanna make sure the family’s taken care of.
Bob:
And the seventh thing is so important at this age, Shawn, with your family growing and you. This financial takeaway should maybe be number one, having an estate plan in order. Or update it if you haven’t done one. So if you did an estate plan for yourself in your twenties and you had no children, now you have children, you need to update it. You need to update it.
Shawn:
Unless you want everything to go to the government, you know?
Bob:
Right. So let’s get to stage three. And stage three is “The Maturing Years” is what I call it. This is the mid forties to late fifties. And this is by far the most expensive stage of life that I’ve seen. Your earnings, though, are going way up during this time.
Shawn:
And usually start to peak out as well. So this is kind of like, this is gonna be about as good as it gets as far as your earning potential, typically. Kids are becoming teenagers.
Bob:
That’s costly because they’re wanting to drive cars.
Shawn:
So now you gotta have a car. Well, even if it’s a used one, there’s still gonna be insurance.
Bob:
The insurance is as much as the car.
Shawn:
Not gonna be cheap on those kids.
Bob:
Yep. I mean, they got, they’re gonna learn. And that’s a dangerous time.
Shawn:
And then we’ve also got high school graduation going on. Or you’ve got kids starting college and if you’re helping them with that, college ain’t cheap. You’ve got the oldest children might even be getting married at this point or finishing college.
Bob:
You have a daughter now, Shawn, so you’ll be paying for that marriage. So you’re not only gonna pay for the college, pay for the insurance for the vehicle. This is all at the same time, by the way. And then she’s gonna want to get married and you’re probably gonna have to pay for that. I’ve been there. I’ve been there. I understand all this. And on top of that, like what happened to Rachael. Rachael, in her mid fifties, is when that cancer cropped up. So health issues start cropping up about this point.
Shawn:
And unfortunately, these mortal bodies do start to wear out. And in this stage, you might have some health issues start coming up. So let’s get to the financial takeaways to be conscious of our time here. Right, Bob? So number one, max out the annual contributions to your retirement plan at work, not just a match.
Bob:
Yep. No longer the match.
Shawn:
Right. Because for one, at fifty, the amount you can add on that upper limit goes up. So for 2023 instead of $22,500 for fifty and older, you can do $30,000 per year.
Bob:
Yeah. And it was actually about $26,000 $27,000 this last year. So now it’s gone up to $30,000 if you’re above 50.
Shawn:
When you’re in your higher income earning period, that’s the other reason why we’re saying to max it out is say, at 50, most people are probably gonna retire at 65. That’s the goal. So, you’ve still got 15 years and if you’re maxing out that $30,000 a year, if you can…
Bob:
That’s on their side, by the way, that’s not including the match.
Shawn:
Exactly. All right. And so that’s just a huge benefit to help you reduce that taxable income and get more set aside for retirement. So number two.
Bob:
Beware of major risk and liability exposure also during this mid forties to late fifties. Especially a sickness like cancer, those kids driving into an accident. So this is a financial takeaway. Be sure that you have an adequate amount of coverage, insurance coverage, for liability and don’t just, for sure, don’t focus on just the best price for insurance. Focus on the amount of insurance. Going cheap is not the way to go. The way to go is to make sure that you have coverage and you’re gonna be glad you had that coverage when you need it. If you go for the cheap, it’s not gonna be there when you need it. It’s gonna be very little.
Shawn:
Number three, the focus on that is you want to make sure your risk is managed properly, not that you just get the cheapest cost.
Bob:
And that third financial takeaway.
Shawn:
Get out of debt completely and don’t go back into debt.
Bob:
That’s right.
Shawn:
So pay off the house, the cars during this period, and from there forward, pay cash going then on. If you can’t pay cash, don’t buy it yet.
Bob:
That’s because you’re no longer in your twenties and thirties where you have a lot of time to pay things off and recover. This is not the time, especially in your late fifties, it is not the time to go be borrowing money on buying expensive homes and expensive cars. Pay cash for those. I’ve never seen anybody hurt by paying cash.
Shawn:
And now, for the fourth and last one is retirement planning is crucial to know what you can retire on. You may need to wait till you’re mid or late sixties if you procrastinated in your earlier years. But it all depends on how much you want or need to retire on. And so many times, Bob, I know you’ve seen this over the years and even in the short period comparatively I’ve been here, people will talk about, well, what’s the return gonna be? What am I gonna make in the investments? That’s not really the question you need to answer. The question you need to answer is more of assuming certain expected rates of return, what is it that I’m wanting to be able to live on and at the rate I’m going right now, am I gonna meet that or not?
Bob:
The majority of the time, the wealth has not come from returns.
Shawn:
That’s right. It comes from due diligence and wisdom.
Bob:
Consistency. Exactly. So, there’s a lot there. There’s a lot there. I know these are just three of the financial stages. We’re gonna get into the next three financial stages in the next episode that we’re going to do. Every one of these stages, I’ve been through three of them and I’m heading into my fourth one now, and I hope I can do this until I’m 85 years old if my mind is still good, I’m gonna keep continuing to do this because when I’ve been through these, I can coach you through these. I know what you’ve… I’ve gone through them. So as a financial advisor, I can help coach you through that.
Shawn:
And you’ve coached a lot of people through some of those later stages as well. Even though you haven’t gone through those personally, you have been there side by side with people.
Bob:
That’s right. This is why you want a very experienced financial advisor, especially one that is fiduciary based, where you’re paying the advisor. They’re not getting paid on commissions. So we’re here to help.
Shawn:
Exactly. We’re here to help. So, if you wanna reach out to us, you can visit our website, www.christianfinancialadvisors.com. You can also call or text us during business hours at (830) 609-6986. Thank you so much for being here. Bob, any final words?
Bob:
No final words. We’ve had a lot.
Shawn:
Yeah, we have. And we apologize for going a little over. It’s just a lot to cover. So God bless and thank you so much for tuning in.
[CONCLUSION]
That’s all for now.
We invite you to listen to all of our past episodes covering many financial topics from a Christian Perspective. To make sure you don’t miss any of Bob’s upcoming episodes you can subscribe to Christian Financial Perspectives on iTunes, Google Play Music, Spotify, or Stitcher. To learn more about integrating your faith with your finances, visit ciswealth.com or call 830-609-6986.
[DISCLOSURES]
Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, also known as Christian Financial Advisors, a registered investment advisor. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host, Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 154 – Life Events Requiring Financial Advice And Planning Part 2Life Events Requiring Financial Advice And Planning Part 2Are you prepared financially for these 12 life events?
More episodes >>
Bob and Shawn discuss the second 6 of 12 major life events that require advanced financial advice and planning. Many of us have already gone through a huge life change, like the ones mentioned in this episode, and even more of us will be affected in the future by a giant financial life change. Therefore, being fiscally prepared by working with a financial advisor is a giant step towards being successful when one of the unexpected (or even planned) events occurs.
You can’t predict the future in the case of a sudden illness or even death. However, you can prepare for these occurrences appropriately. Learn about the preparatory steps you can take for these 12 major life events by working with a financial planner and financial advisor.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodePROVERBS 21:5The plans of the diligent lead surely to advantage, But everyone who is hasty comes surely to poverty.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTIntro:
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with a Biblical worldview. Here’s your Christian Financial advisors host, Bob Barber, and his co-host, Shawn Peters.
Shawn:
Welcome to another episode of Christian Financial Perspectives. We’re so glad that you joined us. If you like financial topics from a Christian perspective, we’d love you to smash that subscribe button and maybe like this video and share it with others. It helps the channel and helps other people find content like this. So today, we are going to be covering part two on 12 life events that require financial advice and planning. We’re going to do, just for those of you who maybe miss the other episode, you can either click that link in the description. or you can go ahead and we’ll give you a quick little recap. So last week we covered the first 6 of the 12. And the verse we wanted to give you guys is, again, Proverbs 21:5, which is, “The plans of the diligent lead surely to advantage. But everyone who is hasty comes surely to poverty.” So Bob, do you want to recap the six from part one last week?
Bob:
I sure do, and this would be just to recap, I really emphasize you go back and that you watch part one, watch part one or listen to it through the podcast, because we get into detail what the reasons are behind each one of these. But this really has to do with life events. And life events require financial advice and financial planning, and they require it before these events occur. Sometimes though, you can’t help it for it to be after. Okay? Like, one of the events we talked about last week was death in the family. That’s an event that that must require financial advice and planning. Another one last week was retirement. Then we talked about divorce. Hopefully, you’ll do that before divorce. You need to look at that. Then another life event is a new marriage. That could be the first marriage, or it could be the death of a spouse and you’re remarrying somebody new. Disability or major illness. And the sixth one was a big one in my book is before any large purchases are done, Shawn, like an RV or a boat or an airplane or that second vacation home.
Shawn:
Or some sort of property.
Bob:
Exactly. So today we’re going to get into detail in part two. Again, we went into a lot of detail in part one, so I’ll invite you to go back and listen or watch that. So another life event that we see, so we’re going to go 7 through 12, is you need to do some financial advice, look for some good financial advice and planning. I always emphasize an experienced advisor. If you’re not going to use us, I’ve got so much experience, it’s crazy. It’s like 30 plus years. is
Shawn:
Is that all?
Bob:
Yeah, that’s all. But I’ve seen so many of these, I’ve seen all of these life events being a financial advisor during my years, but that’s before the sale of any sizable asset, Shawn.
Shawn:
So number one for today, or number seven in our full list. You want to get good financial advice and planning before you sell any sizeable asset.
Bob:
Not after, please don’t. You can come to us afterwards…
Shawn:
It’s too late.
Bob:
We’ll try to help you best we can. But for tax consequences, you gotta do this before, and you gotta do this even before if you’re planning on selling a large piece of real estate, you need to do this before you even enter into a contract for that real estate. Because we may advise doing a charitable remainder trust, as an example, putting that real estate in that and then selling it, especially if it’s a couple million dollar piece of property. But anything that’s up $100,000 plus, you need to get with a financial advisor or planner. And that’s like land. A large stock position is another thing, an investment property, a business. If I sold my business, my basis in this business is zero. It’s going to be all capital gain, Shawn.
Shawn:
So how do you handle that?
Bob:
How do I handle that and what can be done in advance to lower taxes? And so many things can be done, but so many times they call me and they say, “Hey, we’ve got $3 million. We’ve just sold the property. What can we do to lower the taxes?” Well, there’s not a lot.
Shawn:
Not much now.
Bob:
There’s not a lot.
Shawn:
Once the sale’s occurred. So again, that is before the sale of any sizable asset. And we would just say as a general rule, anything about a hundred thousand dollars or more. Make sure you get some advice and planning BEFORE you enter the contractor sale.
Bob:
That’s right.
Shawn:
That’s right. So the next one, a job change.
Bob:
Yeah, exactly.
Shawn:
This is one that I think occurs somewhat frequently on the job.
Bob:
Nowadays. It does.
Shawn:
So how will you manage your old retirement plan? Or do you have, if you have the experience to manage it yourself and a written investment strategy for managing it, maybe you can manage it yourself?
Bob:
Never met one yet….
Shawn:
No.
Bob:
That had an investment strategy.
Shawn:
Unless it’s a financial advisor.
Bob:
Yeah, exactly. Exactly. But yeah, what are you going to do with that old 401k? And you know, that job change could also mean a higher income. What’s that going to look like? Which takes us to our ninth one, which is another major life event.
Shawn:
You get advancement in a job, and so now you’re going to have higher income, which means you want to do a little bit of tax planning. So, and again, similar to when you’re selling that asset, this one is, I guess technically after the job advancement or job change has occurred, but before you’ve already finished the year and you’re about to file your taxes in a couple weeks.
Bob:
That’s not the time to do it.
Shawn:
If you make that change, talk to somebody about the financial planning and the advice and plan for, okay, well what is my estimated annual income going to be compared to last year? How’s that going to affect my situation and what can I do to reduce the overall tax burden?
Bob:
I think also what’s so important about an advancement in a job, where maybe your income goes from $70,000 to a $100,000, you’ve had a huge raise, you’ve gone up $30,000. Does that mean you should go out and spend all that money now?
Shawn:
No.
Bob:
Exactly.
Shawn:
First of all, congrats. But yeah. But second of all, no, don’t spend all of that.
Bob:
We’re not going to say not to raise your standard of living in a little bit with that. I mean, maybe out of a $30,000 raise $10,000 for that, but taxes are going to take another 5k or 6k of that. And then, let’s look at saving the rest, and as you said, because of that advancement, you may be able to completely max out your 401k. Well, you’re not doing that now.
Shawn:
I’m going to give my brother a little bit of praise here first, for an example. He’s a doctor. He’s a primary care physician. And I know when he and his wife, when he was going through med school, they were very frugal, because med school is expensive, for one thing. He was even working at Best Buy for a little while because just for some extra income. And what they did is as soon as he graduated, he was actually starting to get doctor money. They stayed on almost exactly the same budget for an a quite a few years because they were able to accelerate paying off his student loan debt. And so that was one of those things where yeah, his income went up significantly, but instead of all of that just going to a higher standard of living, they said, you know what, let’s save some of this money and let’s use some of this money to pay off our debts.
Bob:
I’m really smiling, Shawn, because I don’t…
Shawn:
He’s a doctor, I’m so proud of him.
Bob:
You need to be proud of him because I don’t hear this very much. I hear, okay, our income went up, especially doctors, I want to congratulate myself now because I’ve been in med school for 10 or 12 years. And now we’re used to living on $50,000 a year. Now, all of a sudden I’m making $250,000 and they just go right up there and spend all of it.
Shawn:
Expenses go all the way up to the top.
Bob:
So, I’m not saying to not congratulate yourself, but if it goes from 50k to 250k, and you are one of these doctors, maybe…
Shawn:
Go to a 100k. That’s still celebrating.
Bob:
Exactly. Or 150k, and save the rest. And like you say…
Shawn:
Or pay off some debt. Do a combination.
Bob:
Get rid of that debt.
Shawn:
As an example.
Bob:
Alright, so number 10 is a major life event that again, you need to get within a financial advisor and do some planning. There’s a new child or grandchild in the family. You gotta look at things like insurance and estate planning. What;s this child going to cost? Maybe a college plan that wants to be set up. I meet with so many of our younger, around your age. They’re getting the new children, the family and the grandparents would like to maybe set aside, start a college fund and you can contact the grandparents.
Shawn:
And if they do say thank you, and then make sure you get on that.
Bob:
There’s a 529 plan you can look at or you could just set up a different account and label that account for it.
Shawn:
Yep. Kind of earmark that. It doesn’t have to be a 529 plan. One of the benefits of of not doing the 529 plan, if you open an account and you earmark it for one of your kids or for the grandkid, but if you earmark it for that, and let’s say when that kid gets a little bit older, they decide to go kind of a non-standard path. Like maybe they’re not going to go to a four year school, but maybe they’re going to study abroad. Maybe they’re going to go into something more vocational…
Bob:
Maybe they’re going to go in the ministry.
Shawn:
Yeah. Maybe they’re going to go into the ministry. And so by not having that 529 plan, you then have the flexibility to help them with whatever that other path is that, like you said, the ministry, if they’re calling them into the ministry, well great, well maybe you can help them with that church plant or whatever it is that they’re wanting to do. So, there’s some option there. But, it’s funny though, as of recording today, my daughter is turning one. And so, my wife and I…
Bob:
And that’s, by the way, y’all, that’s my granddaughter.
Shawn:
That’s my granddaughter. It’s his favorite granddaughter, right?
Bob:
Exactly right.
Shawn:
It’s the only one. But yeah, we’ve been looking at the insurance and the estate planning, just realizing, all right, well, with her being one and my son is four, and like we’re updating our estate planning and making sure that the insurance is enough and making sure that should something happen to us, like how are we going to take care of the kids and who’s first in line.
Bob:
That’s a life event. See?
Shawn:
Well, those are all those things.
Bob:
All right. Now this, these next two are major life events as well, but this next one is a big life event. And we see a lot, we see all these lot. I keep saying a lot, but we do. But this next one is a large inheritance or sudden wealth. I called it, you gotta be careful of that sudden wealth syndrome. And this occurred a lot with where we’re located because we’re just an hour away from what’s called the Eagle Ford Shell, which is oil, big oil. The largest in the world, and I saw this in a big, big way about 10 years ago, that all of a sudden we talk about sudden wealth, it’s this farmer out here has nothing and they’re getting a $2 million check. They need to immediately…
Shawn:
Bob, how many times did you tell me that you would see farmers and ranchers that are making $30,000 to $50,000 a year and all of a sudden they’re making a $100,000 to $200,000 a month?
Bob:
Oh, many times. Many times.
Shawn:
It’s like that. But it doesn’t last either. That oil is real strong at first, and then it starts to slow down.
Bob:
They end up going and buying second homes on the coast. They all want to buy the big boat, the big Ford F-350 King Ranch Edition that cost about $80,000 for the truck. And they’re not thinking about the future. They’re just thinking, okay, I’ve not had this, I want this right now. And it’s amazing how many of – we went through and looked at and they went through that wealth very quickly, and now they have nothing to show for it. They bought depreciating assets. But then we have some that – the old 80/20 rule, 20% said, well, I’m going to be wise with this. I’m not going to get crazy. And now, they’ve got huge amounts of sums, 5-6 million sitting in their accounts, in their retirement accounts. And we did a lot of tax planning there, too, and a large inheritance. Be careful about passing too much wealth down to your children, too, where they can just spend it all right then. Maybe look at some trust planning. So, all this requires good financial advice and planning. And then this takes us down to our last one of the day, which is not very often, I don’t see this much at all.
Shawn:
Yeah. A little less common.
Bob:
But is before you’re thinking about starting or buying a new business. I do see this every once in a while and where are the funds going to come from. Do you have the ability to lose all those funds?
Shawn:
Which is important.
Bob:
We know business in the first couple years, about 85% to 90% of businesses fail. So what type of businesses it is, and we need to plug all that into your financial plan. Again, like we were saying last week, the one that we made about five or six weeks ago that was called integrated financial planning. We can put all that information into our integrative financial planning and it needs to be looked at. So there you go. There there is 12 major life events that require financial planning. And Shawn, I can virtually guarantee you, but a lot of people have never thought about that.
Shawn:
You know what I can guarantee you, Bob?
Bob:
Okay. What can you?
Shawn:
Is that people watching or listening have probably experienced at least one of these in their lifetime. And the longer you live the more likely…
Bob:
You’re going to experience, or I probably experienced three or four of them over my lifetime that definitely was in need of good financial advice and planning. We are here, Shawn and I are here, and our staff. We’ve got a wonderful staff here to serve you. Great advisors. I’m still advising myself. I love doing this. And if you have any of these life events that we’ve talked about over this week and last week, give us a call and/or text us. You can text us and say, I’d like to speak with Bob or Shawn, or you can make an appointment right from our website. So our phone number is (830) 609-6986 and you can text or call that, you can text that 24 7 and we’ll get back to you the next day.
Shawn:
We’ll get back to you during business hours.
Bob:
Or go to our website, check us out at www.christianfinancialadvisors.com. Any last thoughts you want to share, Shawn?
Shawn:
No, I think we kind of covered everything. Like you said, we’ve got a team here. Bob and I aren’t just pretty faces.
Bob:
There’s others behind us, right?
Shawn:
We’ve got other people here, too. We’ve got lots of advisors and we’re here to serve. So, contact us and we’d be happy to help you if you happen to be going through or are about to go through one of these life events.
Bob:
That’s all for today.
Shawn:
God bless and thanks again for joining us.
We invite you to listen to all of our past episodes covering many financial topics from a Christian Perspective. To make sure you don’t miss any of Bob’s upcoming episodes you can subscribe to Christian Financial Perspectives on iTunes, Google Play Music, Spotify, or Stitcher. To learn more about integrating your faith with your finances, visit ciswealth.com or call 830-609-6986.
[DISCLOSURES]
Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, also known as Christian Financial Advisors, a registered investment advisor. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host, Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 153 – Life Events Requiring Financial Advice And Planning Part 1Life Events Requiring Financial Advice And Planning Part 1Are you prepared financially for these 12 life events?
More episodes >>
Bob and Shawn discuss the first 6 of 12 major life events that require advanced financial advice and planning. Saving for the future is not just about retirement planning. There are an assortment of life changes and events for which you need to be financially prepared. Of course, it’s extremely important to start saving for retirement as early as possible, but what about when something unexpected occurs?
You can’t predict the future in the case of a sudden illness or even death. However, you can prepare for these occurrences appropriately. Learn about the preparatory steps you can take for these 12 major life events.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodePROVERBS 21:5The plans of the diligent lead surely to advantage, But everyone who is hasty comes surely to poverty.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
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EPISODE TRANSCRIPTIntro:
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with a biblical worldview. Here’s your Christian Financial Advisors’ host, Bob Barber and his co-host, Shawn Peters.
Shawn:
Welcome to another episode of Christian Financial Perspectives. We’re so glad that you joined us today, whether that’s on video or audio, but if you are checking us out on YouTube right now, we’d love for you to hit that subscribe button and like this video if of course you’d like episodes on financial topics from a Christian perspective. And last time we checked, we’re still at about 80% of viewers haven’t subscribed.
Bob:
You say that a lot, Shawn.
Shawn:
I know. Well, it hasn’t changed. Like I’m hoping for us to hit a 70% or 60% that haven’t subscribed and we’ll work our way down. But yeah, so again, if you like episodes on financial topics, but from a Christian perspective, we’d love for you to hit that subscribe button. It helps us and it also helps other potential viewers to find the content. So today, we have a special program on 12 life events requiring financial advice and planning. And so today we’re gonna just cover part one. It’s gonna be the first six. And Bob, what do you think about this topic?
Bob:
Well, Shawn, what made me come up with this topic is there’s so many different types of life events that happen throughout our lives that many people don’t realize that the first thing they need to do when they’re looking at this life event that’s going to occur is to call an experienced financial advisor for advice and planning. And so that’s where I came up with this list. This list is from over 30 years of experience in seeing this. And many times I will see these life events occur, and financial planning is the last thing that people think of when these life events occur.
Shawn:
Yeah.
Bob:
Where it should be one of the first things that they take up.
Shawn:
That’s right And I think a lot of people, if you’re watching right now, you might be thinking, well, yeah, retirement planning, that’s probably like, what else would you really need financial planning or advice for? But as you’re gonna learn in these two episodes, there are at least 12 major life events that you should be looking at getting some financial advice and planning.
Bob:
And this will not only help you, today’s program, but maybe as somebody you know that’s going through one of these life events. So we do have the first one as re retirement planning. And Shawn, this is not something you should wait until you’re retired to then do the retirement planning. And that’s what I see more times than not: I’m retired now. Now what? Wait a sec. That’s okay. We can do it.
Shawn:
Well, speaking of planning ahead and not waiting to the last minute, we actually, you actually have a…
Bob:
There’s a good scripture for this.
Shawn:
Proverbs 21:5. Do you wanna read that one?
Bob:
Sure. “The plans of the diligent lead surely to advantage, but everyone who is hasty comes surely to poverty.” That’s the importance of pre-planning. So with retirement, this is something that you need to start as early as in your mid 20’s. You need to start thinking about retirement planning.
Shawn:
Well, the sooner you start, the better off you’re gonna be simply because you have more time on your side for the wonderful compounding interest. The, what do we call that? The eighth wonder of the world.
Bob:
Eighth Wonder of the world.
Shawn:
Yep.
Bob:
Exactly. That’s what say it was. It was Benjamin Franklin who said that.
Shawn:
So start as soon as possible, but at the very least, like if you’re in your thirties, you definitely need, if you haven’t started ready, you definitely need to get going.
Bob:
And how much should you save? And that all depends on how much you want to retire on. So this is something I see more times than not, though, now we’re retired and our budget is $80,000 a year and we’ve got $400,000 in retirement. Not gonna happen. You can’t take 20% a year outta your $400,000. So you need to assess this before you ever do retire. Is that gonna work? You gotta look at your age. You gotta look at life expectancy. I will sit down with someone and ask them, how old did your parents live to? It’s genetics. A lot of this is genetics. I’m finding more and more, they’re still alive at 90. So, we need to plan for 90 or 95.
Shawn:
And if you’ve got a bunch of relatives and grandparents and other people who lived to age 100, well.
Bob:
Go to your family graveyard, you’ll see it.
Shawn:
Yeah. You should probably plan for 100 then.
Bob:
I went to my family graveyard. I’ve been on both my mom’s and my dad’s side. And man, we live a long time. We go to 85 or 90.
Shawn:
Just can’t get rid of you. Right, Bob? Y’all just keep on going.
Bob:
My family goes back in Texas to 1830 and we’ve got these, we go back to our grave sight, it’s called Hornsby’s Bend in Austin. And you’ll see these graves from 1850, 1860. It’s amazing. And you’ll see their age and yeah, they lived up there even back then when the life expectancy was low.
Shawn:
Especially back then.
Bob:
Yeah. That was a long, long time. So, how is your pension and all that going to come into play. So, that’s the first life event. The second life event. Go ahead. And you see it listed there.
Shawn:
A death in the family. So something with this is how will the life insurance proceeds be handled? Restructuring family finances? I mean, there’s a lot to think about when there’s a death in the family.
Bob:
You notice one thing I have here under my point, Shawn, is that the amount that you’re getting for life insurance should be kept highly confidential. I’m sorry to say this, but family members, if they know, and I’ve seen this happen, oh, it’s a sad thing too, where I remember one of our ladies that lost her husband in their younger years and there was an over a million dollar life insurance policy and she told a few of her family members and they start coming out of the woodwork about how they need money. And I was like, oh my goodness, so she should not have shared that. That needs to be, keep that confidential, even keep that probably from the children. And then, let’s look at the income that’s needed to, that’s gonna need to be replaced in the absence of possibly the breadwinner, if that was the breadwinner that passed away.
Shawn:
Okay. Now, one thing that you could use as a positive though, is making sure your spouse knows how much life insurance you have, because that’s a good incentive for you to not argue with your spouse and to keep that good relationship. You don’t want it to be tempting or anything.
Bob:
And enough life insurance, more times than not, we see somebody thinks, well, my $250,000 is adequate for what I need or my $500,000 policy, and the breadwinner’s making $100,000 a year. You need a lot more coverage than that. So, we got so many of these to cover and let’s go into the third one.
Shawn:
Sure. So the third one is divorce, whether it’s before a divorce occurs, like maybe you’re in the proceedings for that as well as after the divorce has finalized. There’s a lot of things to think about.
Bob:
We’re working with an individual, and it was from a divorce. And really, I wish so much so that I had been able to meet with her before the divorce because the settlement that she got from the divorce and the lifestyle that she was used to living, there’s no doubt that his attorney took advantage of her, really took advantage of her and now she’s got to really readjust her lifestyle. And and she was married to this man for over 40 years, so are you receiving enough? It’s the bottom line. And enough to replace the lost income and how are you going to handle that settlement? And we’ll definitely work with your attorney and bring the numbers to the screen where you can see them and everybody can see these numbers that this is not gonna work out. There needs to be more here or maybe it’s too much in some cases as well. So, but more times than not, I kind of end up helping the ladies with this. Well, more so than the men.
Shawn:
It’s just like the retirement or the death in the family. That you might think, oh, this is a lot of money, but the reality is that if there’s a certain amount of income you’re needing per year, well how many years potentially are you needing that income? Because that drastically changes that lump sum amount.
Bob:
So it does, it does. All right. This is fourth one.
Shawn:
Number four, new marriage.
Bob:
Yep. And, you know this new marriage. When I say new marriage, it might be the first marriage or it might be a second marriage because of the death of a spouse or a divorce, but now we’ve got to plan for two instead of one. The question “is it the second marriage”, there’s a lot of issues in the second marriage, especially if both have children from the first marriage and how that’s going to be structured. Because there’s always that… if like if Rachael were to pass away and I were to get remarried and we both had children, I wanna make sure that the assets that when Rachael and I were both married that those assets would go to my children, not to the children of the person I would marry.
Shawn:
And vice versa.
Bob:
And vice versa. Exactly.
Shawn:
Yeah. If you were are newly married because your spouse passed away and your new spouse also had children from that.
Bob:
That’s what I meant. Yeah.
Shawn:
Exactly. It’s like, well then they kind of have the same things. Like they have assets, right?
Bob:
Yeah. So that can be structured through an estate planning attorney and we know how to advise you to help you with that. The second thing is financial goals. When you have two people come together, they have different financial goals, and we need to get those goals to where those goals align with each other.
Shawn:
Well, and the other thing too, Bob, is you have people who get remarried and usually each person already has someone that has kind of been there for their financial advisor. And so, when you get married there’s a good chance that you’re gonna fire one advisor and you’re gonna keep the other one. It’s just something to think about, you know? It it’s not like nothing changes. It’s like you said, “Two becoming one.” Well, it doesn’t really make sense to have two separate financial advisors. At the very least, you need one that’s like your primary advisor. Maybe you have another one, you get a second opinion like a doctor.
Bob:
Well, but like I said here, my point that I have, too, Shawn is I’ve seen more times than not, I’ve served the husband and the wife for 20 years. The husband passes away, the wife gets remarried within the next two years and once she gets remarried, that new man, it’s kind of an ego thing here, that man’s like, we’re not gonna use that financial advisor that you and your husband used.
Shawn:
We’re gonna use the one that I’ve picked.
Bob:
I’ve got. Exactly. I see that. So there’s a lot of ego involved there, especially with us men. I’m a man, so I’m gonna say it.
Shawn:
Are you saying we sometimes have an ego problem?
Bob:
Oh yep. We do, especially when it comes to finances. I know how to do it better. So, that needs to, it’s something that’s a life event. That’s a major life event. The fifth life event is a disability or a major illness. And when this comes along, you definitely need to get with your financial advisor or planner look at how this is going to affect it. Is there gonna be a loss of income for a while? You remember when Rachael got cancer, and thank goodness we had very good disability on Rachael and I. I didn’t need to collect any disability because I was not disabled, but she was for a couple of months and that loss of income that she was making, because she was working with the firm then, kicked in. I’m glad that we had the disability and it definitely helped us between that and our health insurance and then Christian Healthcare Ministries covered the deductible. We were out no money, at all.
Shawn:
You know that disability insurance or that for loss of income from maybe even just a temporary illness, like a major illness, that is definitely one of the most common things that we have seen over the years is that people, they’ll have life insurance, but if you’ve got life insurance and you don’t have disability, you’re far more likely during your lifetime to need some sort of disability or like a major illness income replacement insurance than you are life insurance. Because as I’m sure you’re aware, Bob, you only need life insurance once.
Bob:
Yeah.
Shawn:
But you might need the disability insurance more than once. So it’s very important.
Bob:
All right, so this is gonna take us up to our last one for today. So we’re covering six for today. Next week, we’ll cover six more of these major life events that really you need financial advice or planning for. This last one is, and it’s a very important one. We’re ending up probably the last one is the biggest one is before any large purchases are done like a new home, a second home, an investment property, an expensive vehicle. Vehicles today can easily run $50,000 – a boat, a RV, or an airplane. I’ve even seen and had a couple clients purchase airplanes.
Shawn:
And even the small airplanes are expensive.
Bob:
Exactly. So can you afford this? Can your financial plan afford that new boat? Can you afford that second home? What’s gonna be the long term cost of that? And will there be a loss of return on the dollars withdrawn? And Shawn one of them…
Shawn:
The opportunity costs.
Bob:
Yeah. Well one of my things is I never like to put money in anything that’s not gonna be worth more money later. And so if you…
Shawn:
Sometimes you do it, though, but I think you’re…
Bob:
Very seldom do I do that.
Shawn:
You told me a story one time, because I wasn’t here at the time, but you had a client that wanted to take like the whole family, so it’s like themselves, their kids, and the grandkids on this big cruise, right. I think it was $15,000+ dollars. It was a pretty, pretty good amount when you got a whole bunch of people. And what’s really great in a situation like this is, even if it’s something like that, you can plug that information in. Like we use e-money, one of our last, our previous episodes was one on e-money. But basically, you plug that information in, and I believe at the time, just based on how long their life expectancy was to consider already in retirement, that $15,000 was technically a $60,000 opportunity cost.
Bob:
That’s right. That’s correct.
Shawn:
But once you plug the numbers in, they were able to see that, oh, even with that being the $60,000 opportunity cost, they were still well within where they needed to be between now and age 90. So this is just one of those things where even if it isn’t something that is going to be worth more later, at least knowing, hey, is this going to throw us off on our projections and on like, on our targets and our goals?
Bob:
So I would say go back and listen to that podcast we did, what was it about four or five weeks ago, on interactive financial planning and that points to that. So just be very, very careful about taking money outta your financial plan. That’s going to really relate to. You’re gonna have less dollars. It’s gonna be worth a lot less. Now, a second home or an investment is maybe a different story that could be worth more.
Shawn:
That should go up in value.
Bob:
So that’s gonna do it today for the first six life events. Next week, we’ll come back with part two as we cover these 12 life events that require financial advice and planning. If you know anyone that’s about to go through one of these life events that we mentioned today, retirement, death in the family, well, we don’t know that, but if they…
Shawn:
Or this just happened.
Bob:
Yeah. But just happened – divorce, new marriage, disability, or major purchase, feel free to give us a call. Have them give us a call or they can text our number at (830) 609-6986 or visit us on our website at www.christianfinancialadvisors.com. Any last thoughts, Shawn?
Shawn:
No, I think that about does it. God bless, and thank you again as always for joining us. Bye-bye.
[CONCLUSION]
That’s all for now.
We invite you to listen to all of our past episodes covering many financial topics from a Christian Perspective. To make sure you don’t miss any of Bob’s upcoming episodes you can subscribe to Christian Financial Perspectives on iTunes, Google Play Music, Spotify, or Stitcher. To learn more about integrating your faith with your finances, visit ciswealth.com or call 830-609-6986.
[DISCLOSURES]
Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, also known as Christian Financial Advisors, a registered investment advisor. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host, Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 152 – The Math Behind Roth IRAsThe Math Behind Roth IRAsGrab a pen and paper to help you decipher the math behind choosing the right retirement option.
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Bob and Shawn delve deep into the math behind putting money into a Roth IRA. This is a super informative episode for anyone wondering if they should be putting their retirement funds into a Roth IRA, go with a Traditional IRA, or even use a combination of both (or other saving means). As we at Christian Financial Advisors mention a lot, it’s just math! This includes the age at which you begin saving money, the age at which you pull money out, and your income at the time.
We highly recommend getting a pen and paper while listening to this episode to make it a little easier to comprehend. There are a lot of numbers and math that are mentioned, and following along while writing down what Bob and Shawn are saying will make this episode simpler to break down and understand.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersWant to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTIntro:
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with a biblical worldview. Here’s your Christian Financial Advisors’ host, Bob Barber and his co-host, Shawn Peters.
Shawn:
Welcome back to another episode of Christian Financial Perspectives. I’m so glad that you joined us today, and if you have not already, hit that subscribe button. If you like content on financial topics from a Christian perspective, well, what are you waiting for? Hit that subscribe button. Still waiting on about 80% of you that watch the videos to hit subscribe. I promise it doesn’t cost anything. Just one quick little click and it will actually help not only our channel, but also helps you because then the algorithm can find other videos, maybe like ours, that you also enjoy. So, do yourself a favor. Do us a favor and everybody else, and hit that subscribe button.
Bob:
Hey, same thing with the podcast.
Shawn:
That’s right. Yeah, that’s right.
Bob:
Absolutely.
Shawn:
Anyway, all right, now the announcement and advertisement’s over, Bob, what do we got for today?
Bob:
Well, we’re gonna discuss Roth IRAs. And I’m telling you, Shawn, this is a very marketed product in the financial market plan.
Shawn:
Yeah, for sure.
Bob:
And a lot of it at the time, it’s marketed as a one size fits all, and it is far from that. So I’m calling today’s topic.
Shawn:
Roth IRA isn’t for every person all the time, under all circumstances?
Bob:
It most certainly is not, but it’s marketed that way. And can you see in my outline. we have here: “Roth IRAs. Are they a good idea?”
Shawn:
Okay.
Bob:
It all depends on the math. You know how I love that. I always says it depends on the math, and do not invest in a Roth IRA until you hear this or you watch this because, and if you’re thinking about it, you definitely need to watch this and tell your friends if they’re thinking about it or family. Because like I say, it’s just marketed over and over and over.
Shawn:
And this isn’t clickbait. Do not invest in a Roth IRA until you watch this. So without further ado.
Bob:
All right. So the question of contributing to a Roth IRA, Shawn or doing a conversion, because that’s really heavily marketed too, should be, like I said, determined base solely on math. So let’s look at the math. Okay. So first let’s assume that you’re wanting to contribute to a Roth IRA about $500 a month. All right. That’s where a lot of people fall, $500 to $600 a month, without giving over or putting too much in the Roth. You can’t go over your limit, but I think it’s very important for you to think about what tax bracket are you in right now. And the question really boils down to, “Do you believe you’re gonna be in a higher tax bracket when you re you retire or the same tax bracket?” Shawn, I’ve noticed that over the years, and I’ve been doing this for over 30 years, that the majority of retirees are in a lower tax bracket when they retire than during their working years.
Shawn:
Makes sense, especially when you’re at the height of your career, you’re probably making more income pre-retirement than you are in retirement, because once you retire, just because you’re not working, I mean, there’s just a lot of things that you would think at that point that you wouldn’t need as much income, therefore the money maybe that you’re taking out of your retirement account. So Yeah, I would make the assumption that a lot of people are going to be at a lower tax bracket during retirement than they are during their peak career years.
Bob:
Well, Shawn, I have to say that I cannot think of a person that’s a client here, in my 30 years, that’s not. They’re all in the lower tax bracket, and I’m gonna use an example today of a normal household, family household income. Okay. And I know a lot of people say, well, that’s not my normal… well, it is, when you look at the family, when you look at both husband and wife working. It’s around 90k to a 100k a year. What that does, and I want to, we’re gonna put up a income tax the different percentages.
Shawn:
The different tiers.
Bob:
The different tiers of income taxes, and if you take a look at this right now, you’ll see for the 2023 tax brackets that you’re in a 12% bracket all the way up to $89,000, and then you enter into a new bracket. So assuming that person’s at a $100,000 income, the household income, the husband’s maybe making $60,000 or $70,000, the wife’s making $30,000 or $40,000 or vice versa , they’re in that a $100,000 income, then everything they’re gonna put into a traditional Roth IRA or a Roth IRA is going to be at that top tax bracket. All right. It’s not the effective tax bracket, it’s a top tax bracket. So, if you’re wanting to put money in a Roth IRA, for every $500, you need to subtract 22% of that.
Shawn:
Because of the…
Bob:
Income tax bracket
Shawn:
Since the Roth is the after tax contribution.
Bob:
That’s correct. That’s correct. So for every $500 that you’re gonna put into that Roth, it’s actually gonna be $390 or if you do wanna put the $500 in, you’ve gotta figure in, take apples to apples, you’d have to add 22% to a traditional, but in this case, so we’re gonna say $390.
Shawn:
So that $500 immediately turns to $390 because a $110 is going income tax?
Bob:
That’s correct.
Shawn:
So the $390 after tax, I noticed, Bob, you’ve got an interesting thing here. $390 after tax growing at an average reasonable rate of return of 8% for 20 years grows to approximately $230,000.
Bob:
Yeah. It’s very reasonable. I think an 8% return over a 20 year period is a very reasonable return in a growth portfolio, growth moderate type portfolio.
Shawn:
Which if you’ve got 20 years of retirement or more that probably would be in something more growth oriented.
Bob:
So, we’re really looking at the math, we’re digging into the math now. So, that $390 would grow to $230, a normal pullout rate is between 4% and 5%. So let’s assume a 4% annual withdrawal.
Shawn:
A little more conservative, say 4% annual withdrawal during retirement. So that gives us $9,200 a year, tax free.
Bob:
That’s correct. All right. Now there’s the flip side of it. The flip side of it is you take $500, all the money, because you don’t have to pay tax on that, and you put that into a traditional.
Shawn:
So pre-tax. Gotcha. All right. So now, we don’t have to pay anything with income tax right now on that contribution. So based on the same rate of return of 8% for 20 years, it would grow to approximately $295,000 or $65,000 more than the Roth?
Bob:
That’s correct. All right. But when you pull the money out, right, you gotta pay tax, right? Where in the Roth, when you pull the money out, you don’t have to pay tax. So the tax free amount from the Roth was $9,200 a year. The tax amount that you’re gonna pull out, if a 4% withdraw, you’re gonna pull out from $295,000 from the traditional IRA is now $11,800 a year. All right. So now you gotta go out and you gotta pay taxes on that amount of money.
Shawn:
So then the question is, and when you’re looking at tax return or you’re looking at the tax rates right now, if you’re under that $89,000 almost $90,000, then you’re gonna be at 12%.
Bob:
That’s correct.
Shawn:
Which is a lot lower than 22%.
Bob:
And lemme tell you how I arrive at that. So let’s say you want to be, you’re gonna be work during the retirement years. You want the same income, but you gotta realize that $30,000, $35,000, $40,000 with a spouse and spousal income, I mean social security spousal benefit, that’s gonna end up being $35,000 or $40,000 of your dollars. Okay. Even if you’re pulling $40,000 or $50,000 from your 401ks or IRAs, you’re not getting anywhere near that tax bracket.
Shawn:
Right. But then with the supplemented income from the social security,
Bob:
Which you’re not having to pay tax on.
Shawn:
Exactly. But then your actual livable income that you can use for expenses is still closer to what you had during your career.
Bob:
That’s correct. Now, in some cases you will have to pay some tax on some of those social security benefits, but in this case we’ve got the social security calculators here that we can put the numbers in and out of that $30,000 or $40,000 you may have to pay tax on a couple thousand dollars of that. All right. So you’re into 12% bracket. So the $11,800 that you’re able to take out of your traditional IRA, after tax is gonna equal $10,384. And you remember the other number with the Roth?
Shawn:
It was $9,200.
Bob:
That was $9,200. So that equals 13% more dollars every single year. So in this case that I’ve just mentioned, it does not make sense for somebody that is a hundred, a hundred plus income, to go do a Roth IRA. The math does not make sense.
Shawn:
When you factor in the income tax that you’re paying now.
Bob:
That’s correct.
Shawn:
And what that total net amount could grow to and that you then take an income off of compared with yes, you’re gonna have to pay tax on the traditional later, but because your tax bracket is so much lower during retirement, you actually end up being ahead.
Bob:
You do. And I’ve seen this over and over and over too, I can say over, I don’t know, infinity times. I see this when people are retired, they’re in a lower tax bracket, their taxes, they’re paying less in taxes and everyone thinks, well, I’m gonna be in a higher tax bracket. No, taxes are going up historically, and I wanna put a chart up there and I’ll get that chart so we can show that as we’re recording this, there’s a chart that shows historical tax rates in the high bracket. We’re actually much lower. And remember, tax rates are gonna compensate for inflation as you make more. So I rarely, like I said, if ever, meet a retiree that’s in a higher tax bracket. So, mathematically the only reason to do a Roth is if you think you’re gonna be making more money during retirement than when you’re working.
Shawn:
I guess I’m just trying to think under what circumstance would someone… I mean, if you’re in one of those situations or actually anticipate being in one of those situations, we’d love for you to throw that in the comments. But right now at least, I mean, what situation would there be that someone would realistically be making more in retirement in taxable income than during their career?
Bob:
Very not, I mean, not much.
Shawn:
Yeah. I guess if your pension and 401K and defined benefit and all this other stuff was just so crazy high that…
Bob:
The one exception, I guess the one exception I can say is I have seen retirees, but then they’re not really retired anymore. They go back into, they’re getting a retirement income and they go back into the marketplace.
Shawn:
I guess I could see that.
Bob:
And it does make sense to do a Roth, I think a younger couple, it makes sense to do a Roth because they’re not in that high tax bracket yet. Does that make sense?
Shawn:
Right, right. So, if currently your income is lower where you’re only in that 10-12% tax bracket, then it might make more sense. So as you progress in your career, well you know what, there’s a chance that you might be in a higher tax bracket than you are right now, but what that would mean though, Bob, is well five years from now or 10 years from now, that same couple may want to stop contributing to a Roth and start contributing to a traditional.
Bob:
Right. Or their 401k, 403b, 457, Thrift Savings Plan, TSA, they’re all the same thing. They all fall under the same category as what we call a qualified plan, but put the money in that.
Shawn:
Yeah.
Bob:
But there are Roth 401ks, and I’m seeing people that are making over $150,000 a year and they’re putting Roth in the 401k. It’s a mistake. It doesn’t make mathematical sense. Now, I can’t say for everybody it’s a mistake until we look at your specific situation.
Shawn:
Okay. Well it sounds like as a general rule, which again, results may vary and yes you should talk to a qualified advisor, but it sounds like the general rule is if you’re in the 10-12% tax bracket and you’re younger and earlier in your career, looks like the math would probably be on your side. It would make sense to do a Roth.
Bob:
It is.
Shawn:
But that doesn’t mean that just because you decided to do a Roth today, that 5 years from now and 10 years from now, that’s still the right option.
Bob:
That’s right. Or a conversion. You always hear these things about conversion. Why would you do a Roth conversion when you’re making $120,000 – $130,000 a year? That doesn’t make any sense. You have to pay all the tax on it as well. So, never trust your instincts when it comes to a Roth IRA. Trust the math, trust the math. I’m always saying it. You gotta trust the math.
Shawn:
You say it all the time, it’s just math.
Bob:
I love it.
Shawn:
But I think it’s good. I think it’s good. The reason why we obviously say “trust the math” so often is because the math helps you take the emotion out of the financial decision. Because many times, I mean we’re emotional creatures.
Bob:
And I rotate right back to where we were at the beginning of the program, Roths are very heavily marketed, they’re marketed in seminars as the one size fits all and they are not. Hopefully, I’m not gonna get a lot of advisors call and go, “Why did you do this program?” But I think the program needed to be made.
Shawn:
Wait, are you worried about the Roth IRA mafia?
Bob:
They could. Exactly. So is a Roth IRA right for you? You need to look at your situation. Give us a call, and let’s look at it. Let’s look at the math and see. And our phone number that you can call or text to is (830) 609-6986. Hey Shawn, I just got a text yesterday from someone in Pennsylvania saying they just heard the podcast and I answered them back, said thank you and they were asking about our fees as a fee based advisor and I’ve directed them to the right place.
Shawn:
Were they able to understand your accent?
Bob:
I hope so. Through the text? Exactly. And by the way, we appreciate all of you that listen across the nation and listening to this South Texas country boy. And hopefully I am just, I just lay it out there. That’s what I want to do. And so that’s the number (830) 609-6986. Call or text us or go to our website. Check it out and you can you can, from our website, you can make an appointment with different advisors here under the staff. And that is ChristianFA.com or christianfinancialadvisors.com. But you can abbreviate financial advisors and just put FA.com
Shawn:
And yeah, we work with people all across the country. As long as you’re not someone who has to sit face to face, we can do a Zoom so you can see our face and we can do phone calls.
Bob:
That was a question. Do you work with people across the country? I said, “With Zoom and email and DocuSign and text and voice. We can do it all.” Location no longer matters.
Shawn:
Well, once again, thank you so much for joining us today. God bless. And until next time, take care.
[CONCLUSION]
That’s all for now.
We invite you to listen to all of our past episodes covering many financial topics from a Christian Perspective. To make sure you don’t miss any of Bob’s upcoming episodes you can subscribe to Christian Financial Perspectives on iTunes, Google Play Music, Spotify, or Stitcher. To learn more about integrating your faith with your finances, visit ciswealth.com or call 830-609-6986.
[DISCLOSURES]
Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, also known as Christian Financial Advisors, a registered investment advisor. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host, Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 151 – 7 Biblical Financial Guidelines7 Biblical Financial GuidelinesCheck out these Biblical financial guidelines handpicked by Bob and Shawn to help you live a happier life when it comes to finances!
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Bob and Shawn delve deep into some of their favorite Biblical principles when it comes to Christian stewardship and finances, all backed up by Biblical stewardship scriptures. These tips definitely go way beyond just the financial, and they also go into the emotional aspect of trying to live a financially successful life within Biblical guidelines. This includes suggestions like giving to causes greater than yourself – like a local food bank, animal shelter, or homeless shelter.
When we begin to see our money and finances as a tool from God to help others in His name, then the cycle of worry and selfishness can begin to diminish. We hope you enjoy this episode on Biblical financial guidelines as much as we enjoyed making it!
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodePROVERBS 21:20In the House of the wise are stores of choice food and oil, but a foolish man devours all he has.
PROVERBS 22:7The rich rule over the poor, and the borrower is slave to the lender.
PROVERBS 6:6-8Go to the ant, you sluggard; consider its ways and be wise! It has no commander, no overseer or ruler, yet it stores its provisions in summer and gathers its food at harvest.
2 CORINTHIANS 9:7Each of you should give what you have decided in your heart to give, not reluctantly or under compulsion, for God loves a cheerful giver.
ECCLESIASTES 11:2Invest in seven ventures, yes, in eight; you do not know what disaster may come upon the land.
PROVERBS 4:6Do not forsake wisdom, and she will protect you; love her, and she will watch over you.
PROVERBS 27:23-24Be sure you know the condition of your flocks, give careful attention to your herds; for riches do not endure forever, and a crown is not secure for all generations.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTIntro:
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with a biblical worldview. Here’s your Christian Financial Advisor’s host, Bob Barber and his co-host, Shawn Peters.
Shawn:
Welcome to another episode of Christian Financial Perspectives. We’re so glad that you joined us today or tonight, whatever time it happens to be when you’re watching this. If you’d like topics covering finance, but from a Christian perspective, then we’d love for you to hit that subscribe button. Still, we got about 80% of those watching the videos aren’t subscribed, which means you’re missing out on all the awesome updates that we’re putting out. If you like this particular video, be sure to hit that like button as well. Today we’re going to be covering seven biblical financial guidelines, and we hope this will be helpful to you. Bob, you want to give us a little intro on this?
Bob:
You know, what is funny, what you were saying, you can watch this any time of day of the night. I did radio for eight years in Texas. In San Antonio, Austin, Houston, and Corpus Christi, and you had to be there right at that time if you wanted to hear the program. It’s before any of this ever came out. Boy, I love this technology where you can, anytime of the day you can watch this. So Shawn, today we’re going to be talking about seven biblical financial guidelines. There’s just seven and so many of these, this is a lot of common sense, but a lot of wisdom, and this is taken from God’s word. I’m excited to be bringing this to Christian Financial Perspectives. The first one is really a novel idea, especially here in America. So you ready? Let’s do it.
Shawn:
Spend less than you earn.
Bob:
Who would’ve thunk it?
Shawn:
So don’t spend more than you made in income.
Bob:
That’s exactly right. Now that’s not like our government. You can’t just raise the debt ceiling, but yes, spend less than you earn. What’s the scripture?
Shawn:
Proverbs 21:20, “In the house of the wise are stores of choice food and oil, but a foolish man devours all he has.”
Bob:
That’s kind of, pretty tough there, isn’t it? “A foolish man devours all he has.”
Shawn:
Well, you know, Bob, our channel I think is a little different than some of the quote financial gurus out there, because most of the time you have people who are cherry picking certain stocks that they did really well on. They don’t talk about, you know, the other 90% that they did terrible on. Or they’re talking about how if you follow their advice, how wealthy you’re going to be and how many thousands of dollars per day you’re making. It’s always interesting because most of those people make money specifically on selling their courses and the idea that they actually are doing really well. What we’re talking about here with biblical financial guidelines, honestly, is probably a little less flashy, a little less boring, because these are based on scripture It’s based on truth. It’s not based on just hype.
Bob:
There’s no hype here. Spend less than you earn. That’s a simple one.
Shawn:
We’re giving you a little bit of a setup here that you know, again, these are not going to be something that makes you rich in one day. These are things that, they’re biblical financial guidelines and if you follow them, they might not be flashy, but it’ll definitely make a positive impact in your life.
Bob:
They will work over time. They’ve been tried and proven over thousands of years. The second one is control the use of debt. What? Yes. Control the use of debt. You know why? The Bible is very clear on this. It tells us in Proverbs 22:7 that “The rich rule over the poor, (that’s like the banks) and the borrower is slave to the lender.” When we say to control, the use of debt, I know it’s very hard like to buy a home debt free, but I’m hoping that’s the only debt that you have. No other debt at all. As you get older, there’s no reason to borrow money for a car. The cars are so expensive nowadays, but just buy a cheaper car until you can afford more.
Shawn:
Or save up a little bit longer and keep driving the one that you have. This kind of goes back to number one, spend been less than you earn. There’s a difference between buying a home, especially when you’re younger and you don’t have a lot of assets saved up. There’s a difference between using that debt to buy a home and using debt like a credit card to finance going out to eat too often. Just buying stuff that you don’t actually need to live, so be careful with that.
Bob:
Rachel laughs at me because she goes, Bob, you don’t like to spend money on anything unless you know it’s an investment and you’re going to get some money back. I’m kind of like that’s in my nature.
Shawn:
I think that’s a good trait when you’re a financial advisor.
Bob:
I do too.
When you talk about the use of debt in a mortgage instance. You get the tax deduction on the interest and appreciating asset over time. Real estate’s proven to be that.
Shawn:
Not only that Bob, but especially if it’s for your primary residence, you’re going to pay rent or you’re going to pay a mortgage. There isn’t really any other options.
Bob:
My dad was a funny guy, and he said, whether you rent or whether you buy, you pay for the place you occupy.
The third one.
Shawn:
Save consistently and build reserves. Now this scripture is Proverbs 6:6-8, “Go to the ant, you sluggard; consider its ways and be wise! It has no commander, no overseer or ruler, yet it stores its provisions in summer and gathers its food at harvest.”
Bob:
When you were a little kid, did you ever like to watch the ants? They go back and forth and they’re always working. I think it’s interesting that it says, go to the ant you sluggard. I mean, my goodness.
Shawn:
Okay Proverbs settle down now.
Bob:
The fourth one is give the worthy causes because you know what it does when you give the worthy causes, it breaks the chain of selfishness. It is truly more blessed to give than receive. 2 Corinthians 9:7 says, “Each of you should give what you’ve decided in your heart to give, not reluctantly or under compulsion, for God loves a cheerful giver.” So smile when you’re giving.
Shawn:
I love that, breaking the chain of selfishness because when you give and you give not reluctantly or under compulsion, but you give joyfully.
Bob:
With a purpose.
Shawn:
It makes such an impact on the rest of your life. Not just the financial part, but it just kind of gives you this, this peace that, okay, God, I’m trusting you. You’re asking me to give, you’re asking me to help others. I’m giving out of what I’ve received. It’s like we say, I mean, it’s hard to be selfish when you’re focused on, okay, God, what do you want me to give to?
You’re not holding onto that money so tight and just making that fist.
Bob:
When you hold all that money tight like that it causes tension. So let loose, let loose. God owns it all. Psalms 24, 1 says, “The earth is the Lord’s and everything in it.” Number five invest wisely and diversify. A scriptural principle behind this was from Solomon, who said, invest in seven ventures, yes in eight; you do not know what disaster may come upon the land.
Shawn:
That was Ecclesiastes 11:2.
Bob:
Did I say a different one?
Shawn:
I don’t think you said the scripture.
Bob:
I’m sorry about that. Ecclesiastes 11:2, exactly. I just said Solomon because I knew he wrote Ecclesiastes. Solomon did not go put all of his money in just stocks. If he were here today, he wouldn’t put them all in stocks, would he? Or all in bonds or all in real estate. Boy, that’s a big one. A lot of people put all their money in real estate. They think that’s the way to go. All your money in gold. No. He diversified his funds amongst many different types of investments, and just think of that; of all the different ways that we can invest today. You know, we go back a few podcasts where we talked about all the sectors. There’s like 11 to 12 different sectors to invest in. You could still invest in stocks, but be very diversified actually in 11 to 12 sectors even.
Shawn:
So number six, manage risk. This is for health, disability, life, auto, home and liability insurance. That really, that’s what you got to remember on the insurance is that it’s about managing your risk. That’s really all it’s for.
Bob:
Another term that I’ve heard for property and casualty insurance, life insurance, all these different types of insurance is risk management.
Shawn:
I think the easiest one, Bob, for people to think about is your life insurance. People think of, oh, life insurance, if something happens to me, my family gets a lot of money because of it’s payout. The reason why life insurance is so important to have, especially when you’re younger; if you get term life insurance when you’re young, it’s not expensive.
Bob:
It’s dirt cheap.
Shawn:
The risk that you’re managing is that if something should happen to you when you’re younger and you haven’t been able to build up any retirement assets, it helps take care of your family. Because it’s term and it’s going to expire after a while, you need to make sure that the other part of this equation is saving and investing wisely, so over time, as the insurance is expiring, you actually have your own hard assets.
Bob:
At my age, I’m going to be 61 in June, life insurance is expensive.
Shawn:
Ooh. I wouldn’t even wanna know how much your premiums would be.
Bob:
It’s a lot. You know what, another thing that you need to be very aware of is managing risk with auto insurance. You’ve heard it, pay for what you need. Well, wait a second. What do you need? You need enough to cover you. To buy auto insurance or home insurance just based on price is foolish. It’s very foolish. You need to base it on coverage because when that time happens, you’re going to wish that you bought adequate coverage. I’ve seen coverage. If you’re just trying to get the coverage to get by, it is not going to cover you. You’ve got all these guys out here in our area, we got the, what we call the 444 guy. He’s an attorney, the local attorney that advertises here and you know, they’re just out suing people left and right. That’s how they’re making their money. If you don’t have a lot of insurance to cover you, they’re going to go after your other assets.
Insurance is there to help you, especially liability insurance. I like liability, like an umbrella policy covering you. This brings us to the last one.
Shawn:
Let’s not forget our scripture though. We do need to read the scripture for managing risk.
Bob:
Yeah, absolutely. This goes with risk.
Shawn:
Proverbs 4:6, “Do not forsake wisdom, and she will protect you; love her, and she will watch over you.”
Bob:
That’s saying there, I picked that because I thought, well, that is wisdom to manage risk.
Shawn:
Number seven, know your financial condition. Proverbs 27:23-24, “Be sure you know the condition of your flocks, give careful attention to your herds; for riches do not endure forever, and a crown is not secure for all generations.”
Bob:
That is basically saying, write down all of your assets. Write down all of your liabilities. We call it a balance sheet around here. We’ve gone through the financial planning. I’d invite you to go back and watch the one that we did, the interactive integrative financial plan. I can pull up my financial condition 24-7 with just the, you know, click, and there it is. It’s updating every single day. And I know what my financial condition is. Shawn, you’d be surprised how many people do not know their financial condition. They don’t understand their assets and their liabilities and their net worth. If you’re net worth, if your liabilities are higher than your net worth, this is where you need some help. Most definitely. As we come to the end today of the seven guidelines for biblical financial principles, we want to help make sure that you put these in order, and that you use these biblical financial guidelines. Shawn, I’ve never seen anybody hurt by using these guidelines. You’re going to be prosperous when you do. I’m not speaking prosperity theology. You will be prosperous when you follow these biblical guidelines. You’ll be successful financially.
Shawn:
It always makes me think of the parable of the talents. Each servant was given a different amount, but each could have been prosperous with what they had. It did not mean they’d have the same dollar amount at the end, but they could have been, maybe instead prosperous I think a better word would be successful. Be successful with what you’ve been given. Whatever that ends up being.
Bob:
We could have called this seven biblical financial guidelines for being successful.
Shawn:
There you go.
Bob:
We want to help you be successful and a way that you can get ahold of us, we are Christian Financial Advisors and our phone number during regular business hours, central standard time, you can phone or text that at (830) 609-6986. Or you can go to our website to christianfinancialadvisors.com. Any last word, Shawn?
Shawn:
God bless you all. Thank you again for joining us. It is always weird. Is it evening? Do I say goodnight? Good morning?
Bob:
I know. I’m not sure.
Whatever time your day it is. I hope you have a great day, a great night, a great evening. Whatever time of the day you’re listening to this.
Shawn:
Let’s cover all our bases. Thank you for joining us and until next time, God bless.
[CONCLUSION]
That’s all for now.
We invite you to listen to all of our past episodes covering many financial topics from a Christian Perspective. To make sure you don’t miss any of Bob’s upcoming episodes you can subscribe to Christian Financial Perspectives on iTunes, Google Play Music, Spotify, or Stitcher. To learn more about integrating your faith with your finances, visit ciswealth.com or call 830-609-6986.
[DISCLOSURES]
Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, also known as Christian Financial Advisors, a registered investment advisor. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host, Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 150 – What’s Your Financial Freedom NumberWhat’s Your Financial Freedom NumberFigure out how to determine your financial freedom number!
More episodes >>
How much money do you need to retire? It depends on a number of factors including what age you expect to retire and the annual income you want to have available. Even if the number is lower, you’ll probably be surprised at the amount of money that you will need to retire the way you want. This is where your financial freedom number comes into play.
Bob and Shawn show you how to estimate what your financial freedom number might be in order to retire as successfully as possible. Granted, this number can change and there are quite a few factors that go into it. However, having a number to start with allows you to start your journey towards retirement and financial freedom.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodePROVERBS 21:5 MSGCareful planning puts you ahead in the long run; hurry and scurry puts you further behind.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTIntro:
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with a biblical worldview. Here’s your Christian Financial advisor’s host, Bob Barber and his co-host, Shawn Peters.
Shawn:
Welcome to another episode of Christian Financial Perspectives. We’re so glad that you’ve joined us today, whether you’re watching or listening. This is actually really exciting because it’s episode 150. Not for video. We don’t have 150 videos yet, but it is episode 150 between our original audio for the first about 107, and since then we switched to video and audio for the format. If you are watching this and you like content on financial topics and other educational, financial related, but from a Christian perspective, we’d love you to hit that subscribe button, like this video, share it with others. It helps us, it helps others find this kind of content. As of now, Bob, we still have about 80% of those of you watching are not subscribed. So, if you’re watching this, and you like it, please hit subscribe.
Today we have an interesting topic. “What is Your Financial Freedom Number?” Okay, so Bob, most people probably don’t know, what’s a financial freedom number?
Bob:
Well, financial freedom number is when you have, Shawn, enough money that you’ve saved up and invested. Enough money that it can generate enough money to live on. Does that make sense?
Shawn:
It’s self-sustaining, I guess is the way you use that.
Bob:
I’ve heard what people believe is their financial freedom number for many years. I’ve even had some Shawn that have said, well, I’d like to retire and I have $200,000, and I’d like to retire on a $100,000 a year. I’m like, you are a little confused about rates of return and what that can generate. A $200,000 portfolio in our industry, it’s been happening for, I mean, as long as I have been around. The withdrawal rates should be under 5% if you’re under 65. Once you hit about 65, the withdrawal rate can be about 5% for up to about 75, and then you can go to a 6% withdrawal rate. So you got $200,000 and you’re retiring under 65. Let’s say you’re 60.
You’re not retiring on a hundred thousand a year. That will give you, generate safely and not use all that money before you go on to be with the Lord. 8,000 a year. There is a real huge gigantic confusion about the financial freedom number. By the way, I wanted to mention, I just got right into that. It’s just so exciting that it’s our 150 episode. I cannot even think of the thousands of hours I’ve spent coming up with all of these subject matters when it comes to finance, so I’m excited about that. I just had to mention that.
Shawn:
Seeing all the work that you put into this and then I don’t do as much as far as the writing or the script. Then we’ve got Garrett who helps us behind the scenes on the camera, and my wife and your daughter Jenna. She does a lot of our creative direction, and it’s crazy to see how much work this is. Then I see other YouTube creators and think, okay, I have even more respect for you now.
Bob:
I do, I do.
Shawn:
Having been on this side of it now and realized that’s a lot of work.
Bob:
A 15 minute episode is got seven or eight hours behind it, so it is interesting. Shawn, with this financial freedom number I said come up with the scripture this morning. I said, Shawn, look that scripture up about that the plans of the diligent. I asked you to find that scripture in Proverbs 21:5, and you came up with the scripture out of The Message.
Shawn:
I don’t know, I feel like for this program too, I know the message isn’t as direct translation, but I’ve just always liked how more plain English it seems. Like the original intent I guess.
Bob:
This one really hits good.
Shawn:
“Careful planning puts you ahead in the long run; hurry and scurry puts you further behind.”
Bob:
We’re going to point that out later; how the hurry and scurry, and how when you wait for you to start saving for your financial freedom number, it’s hard to catch up. I’ve got my, my trustee
Shawn:
Casio calculator.
Bob:
I’m old fashioned. I know it’s got the big numbers on it and everything, but I like these old calculators. Everybody has a different number, Shawn, and that’s depending on the lifestyle and the wants and your needs. I mean, for some people they can live on $50,000 a year. Others want $80,000 and others want a $100,000 a year. What we’re going to do is we’re going to to pick $75,000 a year for this program. Let’s say we want to find what your financial freedom number would be if you wanted the amount of money that could generate 75,000 a year. Then if you’re retired and you’re in those retirement years, you’re 65 or above and you want to add social security to that, or any pension plans. That’s going to compensate for inflation. That’s the way I look at it.
Shawn:
Really we’re picking 75,000 a year is just, eh, it’s a good number. It’s not a huge amount, it’s not a small amount, but it’s a decent average I would feel for a retirement income. In today’s dollars, if you were retiring today and you wanted to retire on 75,000.
Bob:
Get this ready, okay.
Shawn:
Multiply it by at least 25.
That’s right.
Bob:
I just, somebody just fell off their…
Shawn:
Why didn’t we go with a hundred thousand? Now I feel like that’s a little easier math, right?
Bob:
It is. it is. But I made it more difficult. Somebody just fell off their seat, or they’re on their exercise treadmill while they’re watching us like I do. I watch it too. They’re like, “Huh?” You’re telling me if I want to retire on 75,000, we multiply it times 25, I’m going to need…
Shawn:
Well, to be exact, $1,875,000 or just rounded up to say $1.9 million. If you wanted to retire right now on $75,000 a year, you would need at least 1.9 million to be your financial freedom number in this case. Now Bob, why is that? Can you maybe explain a little bit of where that 25 comes from?
Bob:
It comes back from, if you take anything and you multiply 25 and you have a pullout rate of 4%, that’s where that number comes from.
With $2 million, a pullout number or 4%, which is under 65, you shouldn’t pull more than 4% of the portfolio per year. That’s $80,000 a year. That’s right at that $75,000 mark. Like you said, the real number’s, $1,875,000, but we’re just going to use 1.9 million. We’re going to use that number because, now somebody goes, oh, wow. Well, how do I get to that number?
Shawn:
Most of you are probably, most of you watching are probably not necessarily retiring right now. Again, we wanted to paint this picture as well, imagine if you were retiring right now and you wanted to live on $75,000. That gives us 1.9 million. Now let’s figure out, all right, well, depending on how long you have until you’re potentially retiring. You know, what that plan is. What would it take to get to that 1.9 million?
Bob:
I’ve got all these different numbers and we’ll splash these up on the screen while I’m doing this.
Shawn:
The first thing though, Bob, is we set some ground rules for you guys.
Bob:
Yeah, I think that’s good.
Shawn:
We are talking about how to get to a $1.9 million portfolio, and this is assuming it’s a well diversified growth portfolio. It’s earning an average of say, 8.5% per year.
Bob:
I know that may be a little low, but we had a bear market here.
Shawn:
Yeah, exactly.
Bob:
I love Dave Ramsey. He always says, plan for Murphy’s Law. You know me, I’m a Murphy’s Law kind of guy. If I go on a trip, I’m going to make sure I’ve got plenty of water with me. I got a full gas tank. I don’t let it get below a quarter. I’m not one of these people that goes to the edge. By planning on a lower return, and this is a reasonable return for a growth portfolio over a long period of time. To be using these 10%, 11%, and 12% numbers is not realistic.
Shawn:
Because it’s not always consistent.
Bob:
Exactly. That’s correct.
Shawn:
An 8.5% percent annual return, well diversified growth portfolio over 30 years. You would need to invest about $1,200 a month.
Bob:
A lot people will say, well, how is that possible? Well if you have a 401K and you’re investing $600 in it a month, or $150 a week, let’s break this down. You’re getting a match from your employer or of 3% to 5%, or 6%. Which I see all the time in 401k’s. There you go. You’ve put that together, that’s $1,200 a month. Over 30 years that investment will grow.
Shawn:
To put that into context, over 30 years, $1,200 a month, that ends up being about $420,000. Of that $1.9 million, that would mean that you’ve directly saved about $420,000.
Bob:
The rest of it was growth.
Shawn:
The rest of it was growth. Now over 20 years, if you’re starting just 10 years later,
Just 10 years, it goes to about $3,000 a month.
Bob:
Yes, it does. That’s quite a bit more. Not triple, but it’s 2.5 times that amount.
Shawn:
Now here’s the part that I feel like is crazy here.
Bob:
It’s interesting.
Shawn:
You dropped down just five more years to where, let’s say you have about 15 years until you’re going to retire.
Bob:
Let’s say somebodies 50. Let’s say their 50 years old, they want to retire at 65, they haven’t saved up anything now.
Shawn:
They want to hit that magic $1.9 million. You’re going to have to invest $5,200 a month.
Of that $1.9 million, now you’re having to invest a total of $936,000.
Bob:
Because your money’s not growing for you.
Shawn:
It’s not growing there, it doesn’t have as long to grow.
Bob:
So the longer you wait, you realize the more you’re procrastinating with this.
Shawn:
Now, before we get to that Bob.
Bob:
The worse it gets.
Shawn:
The last one, and this is even crazier. We started at 30 years. If you’ve got 30 years, it’s $1,200 a month. Doable. If you only have 10 years, so let’s say you’re at 55 and you’re like, oh, I really need to get on this. If you’re starting now at 55 and you’ve got 10 years of retirement, and you need to be saving about $10,000 a month.
Bob:
Yeah, that’s a lot.
Shawn:
Now you’re at $1.2 million of the 1.9 directly from savings, investment returns. The effect of compounding interest over time is huge. The sooner you start investing, the better. Starting with just 15 years left, costs you more than double what you’d invest if you’d started with 30 years until retirement.
Bob:
This really shows you can take whatever age you are, maybe you’re a 20 year old and you’re listening to this right now where you say…
Shawn:
Hey, even better if you’ve got 40 years, you don’t need to save $1,200. a month.
Bob:
A lot of people want to retire before 65. Maybe they want to retire at 50. This goes to show you, or if you’re 40 and you say, well, I want to retire at 55. Well, you’ve got 15 years, you better really get with it. You’re going to need to put, you think about the 401k and you can’t even put half of that amount in there. You’ll go over the limits. This really hits people, Shawn. It does. They’re like, I’ve never thought of about that. You’re looking at me and you’re thinking, are you crazy? Well, it’s just math again, like we always say, it’s just math.
Nothing else. I believe we’re talking about a $75,000 a year income for retirement. That’s reasonable. We’re not talking $300,000 a year. If they’re going to take 30 years, they need to start investing at least $600 a month if they have a match on the 401k. If they don’t have a anybody matching them, they need to save $1,200 a month Yeah. The number one reason behind financial failure, we’ve said it many times, what’s the number one reason?
Shawn:
Procrastination.
Bob:
It’s procrastination. You cannot procrastinate on these numbers to get to your financial freedom number. We are here to help you with that. We use a financial planning program. We put all these numbers in. We put the inflation factor in there, and we can play around with these different returns, but we also must be realistic on the returns. If you’re wanting to get a growth return, you have to be willing to go through volatility to get that. The higher the growth rate, the more volatility you need to be able to put up with over time.
Shawn:
Bob, even that 8.5%, we were saying that it was a more conservative growth return.
Even that 8.5%, that’s still going to require some volatility. Where you’re going to have years like 2022 where it was not a bull market. Things were down overall. You can’t just expect that every single year is going to be the 8.5%. That’s the average return. If you’re in it for the long haul, I think the main thing is if you didn’t get anything else from this program, remember two things. One, start as soon as possible. Do not wait. Even 5 or 10 years depending on when that is, can make a huge difference. Then the second thing is, make sure you don’t lose your train of thought. Bob, what was I about to say?
Bob:
I don’t know, Shawn. I’m waiting for you.
Shawn:
I’m sorry. The most, more things just don’t delay. That is the most thing. Well, no, I was going to say the other most important thing was that remember the times 25.
Bob:
You’re having a senior moment here Shawn.
Shawn:
I’m having a senior moment. I’m not even 40 yet. I don’t know what’s going on.
Bob:
What was the second one?
Shawn:
The second one was remember the number. It’s that whatever that number is, you’re wanting to retiring now times 25. That gives you a good idea of your end goal.
Bob:
Multiply it times 25.
Shawn:
Start righ away, multiply your number by 25.
Bob:
You got it. We’re here to help you with this at Christian Financial Advisors. Our phone number, you can call it or you can text it. It is (830) 609-6986, or you can find us on the internet at christianfinancialadvisors.com. There’s a lot of good information on the website. I would invite you to spend 15 or 20 minutes there and kind of go around to all the different pages we have.
Shawn:
If you’d like more videos on these financial topics from a Christian perspective, please hit that subscribe button as well as to see the next time that I mess up live on camera.
Bob:
You drink the water and it goes down the wrong way or whatever. It just goes to show you, we’re just two guys here. Father-in-law and son-in-law coming right at you, and I hope you’re enjoying it. 150th episode. Wow.
Shawn:
God bless. Thanks again for joining us for our 150th episode. Till next time.
[CONCLUSION]
That’s all for now.
We invite you to listen to all of our past episodes covering many financial topics from a Christian Perspective. To make sure you don’t miss any of Bob’s upcoming episodes you can subscribe to Christian Financial Perspectives on iTunes, Google Play Music, Spotify, or Stitcher. To learn more about integrating your faith with your finances, visit ciswealth.com or call 830-609-6986.
[DISCLOSURES]
Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, also known as Christian Financial Advisors, a registered investment advisor. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host, Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 149 – 10 Traits of Christian Millionaires10 Traits of Christian MillionairesDo you have any of these traits commonly seen in Christian millionaires?
More episodes >>
Bob and Shawn discuss the 10 common traits that they often see in their Christian millionaire clients. These traits aren’t what you think! Surprisingly, only about 2-3 directly involve finance and investments. Most of the traits that we see here at Christian Financial Advisors involve deeper characteristics and traits, like consistency in their career and/or exemplify Godly values like integrity and honesty. Above all when it comes to financially successful Christians, Bob and Shawn have noticed that most believe that God owns it all. It is his money to begin with, and we are just His earthly stewards of these blessings.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodePROVERBS 13:11Dishonest money dwindles away, but whoever gathers money little by little makes it grow.
I TIMOTHY 6:10For the love of money is a root of all kinds of evil. Some people, eager for money, have wandered from the faith and pierced themselves with many griefs.
PSALM 24:1The earth is the Lord’s, and everything in it, the world, and all who live in it.
LUKE 16:10Whoever can be trusted with very little can also be trusted with much, and whoever is dishonest with very little will also be dishonest with much.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTIntro:
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with a biblical worldview. Here’s your Christian Financial advisor’s host, Bob Barber and his co-host, Shawn Peters.
Shawn:
Welcome to another episode of Christian Financial Perspectives. So glad that you joined us. If you haven’t subscribed already and you like videos on financial topics, but from a Christian perspective, love for you to hit that subscribe button like this video and share with others. It helps both our channel, but also helps other people like you find this kind of content. So, today we’re going to be covering an interesting subject, the “10 Traits of Christian Millionaires.” Now, this is not a prosperity theology kind of an episode. We are not teaching you how to how to get rich. This is just more of a interesting commentary of, of what we have seen over the years, especially Bob over common traits of people who are Christian and happen to be wealthy. So Bob, why don’t you give us a little more of an introduction.
Bob:
There’s no doubt that this is a tough one to tackle, Shawn. I don’t subscribe to the prosperity theology mindset, but there are things that happen. You do this over the many years and you end up many times becoming a millionaire. I’m not saying this always happens. In my younger years I had a lot of good mentors and I watched them and I noticed there were traits in millionaires versus Christian millionaires, or Christian millionaires versus millionaires that made it from a secular worldview. These Christian millionaires, they really had a biblical worldview towards how they handled their finances, and following that biblical worldview. I want to be careful, I’m not saying it’s not always going to make you a millionaire, but there’s just so many common traits. You know Shawn, being that we’re Christian Financial Advisors, we work with a lot of Christian millionaires that love the Lord. It’s not about the money with them. Which is really interesting how this happened. Very seldom did they become, they didn’t set out to be a millionaire. It just happened by using these biblical principles of giving first and in saving, investing, honesty is a really important thing with Christian millionaires, and a consistent lifestyle that’s not based on materialism.
Shawn:
Or consumerism.
Bob:
Exactly. They don’t care if they’re driving the latest, greatest, most expensive car. They don’t get their self worth from that.
Shawn:
It makes sense. Really it comes down to for a lot of the Christian millionaires that you’ve come across, is that consistency, that honesty, not focusing on the consumerism basically leads to a very God-honoring, frugal lifestyle. Which chances are by the time you get to retirement age is a good chance you might have been able to accumulate a pretty good amount of wealth.
Bob:
It happens slowly. It’s not a get rich quick. They don’t buy lottery tickets.
Shawn:
Which is a great segue, Bob, into our first scripture. Which is Proverbs 13:11, “Dishonest money dwindles away, but whoever gathers money little by little makes it grow.” Then of course, the other one that we’re going to go over is 1 Timothy 6:10, “For the love of money is a root of all kinds of evil. Some people, eager for money, have wandered from the faith and pierced themselves with many griefs.”
Bob:
We emphasize right, money is not evil in itself.
The love of money. If it’s all about the almighty dollar. As my dad used to say, “Is it all about the almighty dollar?” If it’s all about that, your heart’s in the wrong spot, especially if you want to be a Christian millionaire.
Shawn:
So, first love God, seek him and realize he is the owner of everything, not you.
Bob:
That comes from Psalm 24:1. It says, “The earth is the Lord’s and everything in it.” Here are the 10 main traits. We’re going to list these out as we go through them that we see. First one: they love the Lord with all their heart and they are faithful to their church, to the T man. I mean, I see this over and over. They’re involved in small group bible study. They’re very faithful to their church. They love other ministries. They go on mission trips. Many of our clients they’ve been to the holy land several times. They’ve been on trips to Africa or Mexico, or even involved in missions in their own town. It’s a wonderful thing.
Shawn:
Again, their focus is on the Lord. In their church and how they serve.
If they happen to acquire more wealth or more money, that was never the goal. That’s never the focus. The next one: they are givers and not all about themselves. I think again that’s if I remember correctly, and I’m sure so if I’m wrong, correct me in the comments, but I remember reading that really the only time that God was ever asked to be tested. Where it’s like, test God in this. Basically came back to the giving.
Bob:
Malachi 3:10 by the way. “Test me in this and see if I will not throw open the flood gates from heaven, you will not have room enough for it. Bring the tide into the storehouse is what that says, so go in and read it. It also says, “I’ll prevent pests from devouring your crops.” Now, maybe we don’t have crops today, but I’ll prevent pests from breaking down your car. Things like that. That’s where giving is. It’s very scriptural and biblical.
Shawn:
Regardless of how much you’ve been given. I mean, it makes me think of the parable of the master and the servants. Each was given a different amount, but each was given something. I think that part of testing God and how he’ll take care of you, and talks about the birds of the field, or the birds of the air and the flowers of the field. Well, obviously how much more does God care about you? Well I think that’s what it comes down to, is whether you have a little, kind of in the middle, you have a lot. It doesn’t really matter because whatever it is that God has entrusted you with, you should be giving. You should trust God. Whatever you end up with is what you end up with.
Bob:
You know what’s interesting? So far we’ve shared two of the 10, and neither one of them has been financial. By the way, out of these 10, there’s only three that are financial.
Shawn:
Directly financial.
Bob:
That gets you to the point of being a Christian millionaire. Isn’t that interesting? The third one is: they have deep roots in their community, they have long-term friends, and their family is around. Very family oriented. Even if they don’t have children, they still have that family at their church. They have that family in small group. That is a strong trait. Do you notice these first three traits? Like I said, nothing financial. Then we get to the fourth one, which is?
Shawn:
They’re careful with how they spend God’s money. Like we already said, it’s whatever God has entrusted to you. They’re careful with what they do with that money.
Bob:
They look at their money, God’s money, like this is your money Lord. I’m a manager of it, and I want to do a good job with it. That’s where that third, I mean that fourth trait comes in. That’s the first one that is financial. Now these next several are nonfinancial, but they are, when you think about it. They have job consistency and they’re faithful hard workers. They don’t hop around a lot. They don’t chase fantasies. I’ve noticed that with every single one of them I’ve come across. Maybe three different career changes in their 35 or 40 years, maybe three. Very seldom do I see anybody that’s four or five or six. They’re not chasing after the wind. There’s a scripture, it talks about that, chasing after the wind. Be careful of doing that.
Shawn:
Well it’s not a scripture, but it makes me think of the, oh, “The grass is always green on the other side.”
Many times I think when things aren’t working out, it’s not so much that, oh, this is just wrong. Maybe you need to look at, well what’s your attitude when it comes to the position? What’s your mindset where you’re coming from? If there’s a problem with how you’re approaching things, moving to a different location means you’re going to have the same problems that are going to follow you.
Bob:
It’s going to follow you. That’s right. Work as if you’re working for the Lord no matter where you are. Work appears in the Bible over 500 times. Now, we have many single Christian millionaires as well. They’ve never been married. The trait that I’ve noticed, but the majority are married, the trait that I notice is with all of them is they have long-term marriages. I mean, they’re married 35, 40 years. Rachel and I are coming on 39 years this year. Next year we’re going to have quite a big blowout. It’s amazing we haven’t killed each other all this time.
Shawn:
Well, she’s a very godly woman. She’s put up with you for 39 years.
Bob:
We love each other, definitely. I’m telling you, the glue that held us together is Jesus Christ and the Lord.
Shawn:
Bob, that’s an interesting one; they have long term marriages. Because some of you may look at that and think, oh, if you haven’t been married a long time, you can’t be wealthy. It’s more than that because for one, I mean even not even looking at it from a biblical perspective, look at it from a secular. Marriages, when they end can be extremely costly financially.
Bob:
You start splitting the assets on.
Shawn:
Even taking out the spiritual and mental and emotional impact that can have on you going through a divorce. Just the actual financial impact can be extremely detrimental if you’re talking about how people are able to actually build an, an acquired wealth over their lifetime. Having that long-term marriage, that’s a good financial win because chances are what you can do together and grow is going to be a lot better than if you had to split everything in half and start over.
Bob:
The next two, so the next two are going to be actual financial: they are savers and they invest wisely. They do not chase after the wind. They don’t try to put it all on one stock, or one piece of real estate, or one company. They diversify and they use that biblical principle of diversification. They look at their investments and their savings differently. Just like what we were talking about yesterday here at, at the office. You have your spending checking account, then you should have your savings account, and then you should have your investment account.
Shawn:
Your investment account should always be focused on long-term. Not, oh, I’ve got money in there, I’ll just pull it out. It’s like, well, no, no, you have to have those different buckets for emergency, or things that, maybe you’re saving up for the new car you need to buy at some point, whatever it is. Then your investments should be for, really typically for most people, your investments accounts are going to be to supply you income in your retirement years.
Bob:
You’re supposed to let that principle grow. Don’t touch that principle ever. Let the principle, increase your interest dividends and long-term gains.
Shawn:
Number eight.
Bob:
Another financial one, and then that would be it for, and then we have two more after that. This is the only other one that’s financial.
Shawn:
They are debt free except for maybe a mortgage.
Bob:
Most, by the time they’re my age, which I’m 60 now, they don’t have that mortgage anymore. Or it’s very, very small if they do, so they use that. Like you’ve heard me say here, an old country boy told me many years ago. You know I’m a country boy too, but it’s so funny how he said it. He said, “Son, I ain’t never seen nobody hurt by being debt free.” In the way he said it with that twang, which I already have a twang, but the way he said it was even more of a twang. That stuck me, that really stuck to me. This was a Christian millionaire that said it.
Shawn:
So number nine: They don’t wear themselves out to get rich.
Bob:
They don’t.
Shawn:
That’s an interesting one, Bob. What do you mean by that one?
Bob:
Well, they have their families. They have their church, they’re involved. They’re not working 15 hour days, and they’re not working all through the weekends.
Shawn:
You mean they’re not doing that because it’s not all about the money.
Bob:
That’s exactly right. That’s exactly right.
Shawn:
They’re actually valuing their family and their church, and their time with God.
Bob:
I want to say this 10th one because this is really one that I think is so strong. They exemplify good values, very good values, like honesty. Honest to the core, Shawn, I mean integrity and faithfulness. They live by a biblical worldview based on absolute truth, not relativism. Which is so different than today. Truth to them and to me is the same way, because I have a biblical truth that was the same a thousand years ago. It’s the same today. It will be the same in a thousand years. It keeps you from being mixed up. When you start making truth relative versus absolute, you get mixed up. They’re not mixed up.
Shawn:
It’s hard to be honest. Have honesty and integrity if truth and how you’re going to respond to a situation is, “Well it depends.” It’s relative. Well it shouldn’t be. It should never be relative. We have a few more scriptures.
Bob:
That’s the 10, and I think these 10 are very, very good.
Shawn:
We’re going to cover 1 Timothy 6:10. I know we said that one earlier. That’s such a good one. “For the love of money is a root of all kinds of evil. Some people, eager for money, have wandered from the faith and pierced themselves with many griefs.” First love God, seek him and realize he’s the owner, not you. Then Psalms 24:1,
Bob:
“The earth is the Lord’s, and everything in it, and all who live in it.” I’ve said that one over and over, so do a good job with what you have and what God’s given you. This scripture emphasizes about doing a good job with the little things first from Luke 16:10. One of my favorites, “Whoever can be trusted with very little can also be trusted with much, and whoever is dishonest with very little will also be dishonest with much.” The whole point I want today to be is that that Christian millionaires, they don’t associate their net worth with their self worth, but it’s an association with their relationship with Christ. It just happens by following these biblical principles.
Shawn:
It’s a very different mindset than the way of the world. The point of this program, Bob, then, or to summarize what you were saying, is we’re not presenting these traits as this is a way for you to get rich.
For one, if you live this way, it’s definitely a lot more rewarding way to live whether you become a millionaire or not. Again, I think it’s just very interesting to see the common traits of Christians who have been able to gain a lot of wealth.
Become come millionaires.
Bob:
Like I said, they’re large givers. They’re very large givers. Well, I hope this has helped you today. If you would like to give us a call here at Christian Financial Advisors to help give you Christian advice about how to handle the funds that God has given to you. Give us a call or text us at (830) 609-6986, or you can find us on the web at christianfinancialadvisors.com. Any last words, Shawn?
Shawn:
No, I think that’s it. Thank you so much for joining us and God bless.
[CONCLUSION]
We invite you to listen to all of our past episodes covering many financial topics from a Christian Perspective. To make sure you don’t miss any of Bob’s upcoming episodes you can subscribe to Christian Financial Perspectives on iTunes, Google Play Music, Spotify, or Stitcher. To learn more about integrating your faith with your finances, visit ciswealth.com or call 830-609-6986.
[DISCLOSURES]
Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, also known as Christian Financial Advisors, a registered investment advisor. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host, Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 148 – Integrative Financial Planning – How It’s Different TodayIntegrative Financial Planning – How It’s Different TodayLearn why integrative financial planning is so unique.
More episodes >>
Integrative financial planning is a huge part of Christian Financial Advisors through primarily a tool called eMoney. We try to make your investment and financial planning as easy as possible through online tools that are easily accessible 24/7. So, what exactly makes eMoney so great? Bob and Shawn go step by step through an eMoney profile to break down exactly how the program is used and how Christian Financial Advisors uses this platform to create and show clients a financial plan.
Whether you are planning on saving college money for kids and grandkids, or you just need a place to start with creating retirement funds, integrative financial planning is a great place to start. We are here to help clear up any confusion or questions surrounding this process!
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PeterseMoneyWebsiteWant to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTIntro:
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with a biblical worldview. Here’s your Christian Financial Advisor’s host, Bob Barber and his co-host, Shawn Peters.
Shawn:
Welcome to another episode of Christian Financial Perspectives. We’re so glad you joined us today. If you like content on financial topics from a Christian perspective, we encourage you to hit that subscribe button. As of recording, we still got about 80% of people watching that have not subscribed, but we’d like you to hit that subscribe button, if you don’t mind. It would help us out and it would also help other people who might be looking for this kind of content. Today we’ve got kind of a interesting format. We’re going to be looking at a bunch of stuff on the screen. Bob’s going to be kind of in the driver’s seat, if you will. Going over our client portal system called eMoney. So Bob, you want to give us a little introduction on that?
Bob:
Well, eMoney is our integrative financial planning program that we use. The reason I wanted to do this in the form of a podcast video, and by the way, podcast, you’re not going to get to see the screen, so I would really emphasize that you go to YouTube to see this. Shawn, every time I have an appointment with a client or even a pro prospective client, and when they see this program and how interactive this financial program is, this is interactive financial planning that is best. When they see this, I can just watch the nearly the scales drop from their eyes, and their fears go away because there’s so many unknowns in the financial planning arena and the future. What can we do? Can we retire on this? What about if we want to buy this new car, or we want to do this remodel?
What if we want to have this home on the coast, a second home or something like that? This system can do all that. I’m going to bring, for the next 15 minutes, I’m going to bring a little bit of this system to our audience so that you can see this and you can determine for yourself if you would like some financial planning. Some integrative financial planning. This is unlike the old days of financial planning. Where we used to take the information, we would go put it in a program, spit out a big thick financial plan, put it in a binder, give it to you, and that’s it. Until you redid it completely, that was the plan you went by. It’s not like that at all anymore, so I’m going to show our audience.
Shawn:
So really, I would summarize like this for those of you watching; e-Money, the way we use it here as as a firm allows us to make sense out of all of the craziness and cloudiness, when it comes to finances. Knowing how much you have in your investment accounts or your savings account, that’s really just one piece of the puzzle. There’s a lot more to it than that. This is what we use to help you figure out questions like, “Do I have enough for what I’m wanting to retire on for income?” “Are we on track to hit the numbers that we need to hit?” “Are we okay if we take the family on a cruise?” Maybe you’re going to take your kids and grandkids.
Bob:
On that big cruise or that Hawaii trip.
Shawn:
Exactly, so without further ado, Bob.
Bob:
Here we go. We’re going to pull up the screen here. This is called our eMoney system. It’s a system that a lot of financial advisors use. I’ve been using it for many years. I know it so good it’s from muscle memory. This is an actual client with the name changed, of course, the Frank and Joanna sample. What you’re seeing here on the screen is basically a snapshot of them. This is called our overview. We’re looking at their net worth. We’re looking at what they have in investments. We’re looking at their asset allocation overall. Then you’ll see, on the upper right hand corner, you’ll see their risk number and then what the risk is of the portfolio. That’s how much risk can they tolerate out of a scale from one to a hundred in their portfolio, which is a 68, and their portfolio is actually at a 64 right now.
Shawn:
So Bob, this is pulling in not just their assets under management with our firm, but it’s also bringing in any other held away assets. We’ve got 529 plans. There’s credit union, like money market, there’s, checking account. We’ve got Frank’s 401k from his work retirement account. We’ve got Joanna’s 403B. One of the things that’s that’s great about this is you can use it not just for what we’re managing for someone as a client, but you can also put in all of those other assets, so you can see your full financial picture. Then of course when you’re trying to make those financial planning decisions with an advisor you’re able to do that on the whole thing, not just the little piece of the pie, if you will, that we’re helpful.
Bob:
It’s a blueprint and you can’t build a home from a blueprint when you only have 10% of it, or 25% of it. Frank and Joanna, is that what I named them again? Frank and Joanna, I want to make sure because I changeg the name. A lot of that what’s in their moderate managed account, which is $746,000, a lot of that was inherited. About $400,000 that came from an inheritance a couple years ago. Then Joanna’s IRA rollover, she works for the hospital administration and that came over in the form of a 403 rollover. Then you can see down here Frank’s 401k where he is still working is at $522,000. This is so typical of many of the people I work with. Then they have $75,000 in CD’s, and then about $45,000 in their credit union, and then the kids.
So you see this, how does this look though? How does this look in real life? I’m going to go over to the five year cash flow and this is all the information that we enter into the five year cash flow. You’ll look at the top and the way the five year cash flow is, first it has the investments, and if you look where I’m on the screen and I highlight that in blue, you can see that that’s where the investments are expected to be at the end of 2023. This is their retirement accounts.
Shawn:
You’ve got investments, we’ve got retirement accounts, we’ve got cash accounts. We have if there’s any insurance accounts that have a cash value.
Bob:
You can see year by year that grows a little bit. One of the things with this particular couple is that while Frank makes a very good living over $200,000 a year with bonuses, and then Joanna has a part-time income making $38,000 These plan distributions are for education. If you go down right here, you’ll see this, the $31,703 and the 31,703 it’s coming out. That’s from a withdrawal coming from the 529 plans. Inside of here I’ve got Frank’s salary, his cash flow, living expenses, what’s expected, 529 withdrawals, and then their insurance premiums. What taxes he’s going to have to pay and they also want to buy a new car you can see in 2026. We’ve got that figured in here. You notice this, they’re negative cash flowing.
They went out, when they got that inheritance, they went out and bought a new home on the coast. I’m telling you it’s eating their lunch. Now, they’re okay because they have enough in their investments that the investments are overcoming that negative cash flow. But we’re having to pull that from the investments on a year by year. Now, I’ve got in the system here, their home, we’re going to be selling that beach home that they have in about 25 years. Otherwise, I’m going to show you this on a full cash flow, if you look at this, you see this blue line? This is their money going up and then they retire and this is their money coming down. If that blue line goes away, they’re out of money. Then they come in and they sell their beach home. You can see right here, when they look at cash flow, their beach home’s only valued at about $550,000 today. You can see 25 years down the road is expected to be with a, with a just a three and a half, 4% inflation rate.
Shawn:
Which is pretty reasonable.
Bob:
For about 1.2 and that money’s going to come back in because you can see that their investments were at 2 million. They got all the way down to $898,000. They sell their home, goes right back into it. That’s why when we go up here, we’ll see this move down and then we’ll pop that line back up. They’re still very much on the edge for their lifetime. Now I do have them all the way out to a hundred years old. There’s 98 and 97, it shows them running out of money. If you look right here on this line, when you look out to the far right, you’ll see that they run out of money at that point if they live that long.
Shawn:
Even those last couple years, they’re getting pretty low, pretty quick.
Bob:
Now we have our system, we can go in and ask it and we say, okay, what’s the maximum retirement spending they can do? Really, all they have to do is make a small adjustment here to their retirement spending in today’s dollars.
Shawn:
So that’s only a change of about $3,000 a year.
Bob:
That’s correct. It’s not much
Shawn:
Off of $120,000. Which is not much.
Bob:
Over time, what happens is the expenses, that is net of taxes, and also that compensates for inflation in the program.
Shawn:
Again, it’s a $3,000 change in today’s dollars, but over time, that starts adding a lot.
Bob:
$10,000 or 20,000 in tomorrow’s dollars. We have figured in here, we get back the cash flow and we’re over here for five year cash flow. This is one of the most important pages that someone can look at. You’ll see they have a son right now named Travis. I did change the name of the children too. They have a son named Travis who has two more years of college. He’s going to Texas A&M they’re actually, both their children are going to Texas A&M right now. That’s the cost to go to Texas A&M this year. They have two children in, and you can see that’s why a little bit of negative cash flow in there too. Then it drops off, if you go over here, you can see where Britney’s had her four years. Travis is finished up. You can see their age 59, and I can come up here and I can hit next five years. Next five years will give us where you are going to be. At that point, you’ll notice the kids completely drop off, but then right in here at age 65, you’ll see, it should be social security. See, social security’s starting to kick in right in here. Right off to the far right.
2032. I like to look at this and I like to say I’m going to pop it to where they’re about 65 years old. That’s going to pull up the range right here, and that’s going to show that social security completely kicking in and a few years for both of them. Which is quite a bit. Inside of that, we’ve got their living expenses, their taxes, everything’s in there. It even drops off. There’s your liabilities. That is the loan on their home, and the loan on their beach property. Eventually that drops off. If you pop this out to about 75 and you’re going to notice you won’t see that there anymore. iI will completely go away, and that’s all compensated for in the plan.
Let’s see if they still have some liabilities. Well, they do. They had a 30 year note, but it did go down some. What’s also neat about this is that I have built in here, like when they want to, they want to buy a new car in a couple years. They have a very old Lexus, they want to buy a new one. I have that compensated into the plan for them drawing that out in three or four years. There’s nothing we cannot put into the plan. This is how powerful this is. This is what I really wanted to show people. We got the balance sheet right here. This shows everything. This is updated every single day. As the markets change, as they pull money out, everything is updated.
Shawn:
When we’re looking at things like the five year cash flow, we’re looking at the, all these kinds of projections, there’s a lot of planning ahead where we’ve put in a client’s income, their, like you said, their inflows or cash flows. We put in all the different expenses. We put in the things that are planned may be five or six years from now, that’s whatever the case may be. Then what the system is doing is it’s taking all this information and looking at tax tables. It’s looking at in today’s dollars with assumed average inflation rates. There’s a lot of calculations going into this to make sure that everything is looking at, with it being adjusted. There’s rates of return on your investments, there’s the inflation on the actual expenses. All of it to basically help you answer those big questions of, “Do we have enough?” “Are we saving up enough for when we actually do retire?” What about all these things that come up? Really it all comes down to being open and transparent. If you let us know what it is that you’re planning for, we can put it in the numbers, and we can help you figure out options to meet those goals and needs.
Bob:
Once this is put into the system, all you have to do is tweak it.
Shawn:
So, your income changed a little bit.
Bob:
We can change that. We do it all the time. See right here where you see Frank’s earnings, at $267,000, that’s what it’s expected to be when he’s 63, 64, then he retires. It goes to zero. All that’s compensated for in here, Joanna’s earnings, she wants to retire at the same time that Frank wants to retire, so all that goes to zero at that point. The kids’ college is done with too. At any point they could say, well, we don’t want that beach home anymore. We’re going to go ahead and sell it now. We come back in, we readjust it. Instead of it getting so low before they do sell it.
Shawn:
Well the other part that I really like in eMoney is the decision center.
We can plug in and say, instead of changing the core facts, what we could do is go in and just say, well, what if in this case Frank decided to retire a couple years early? What if he retired a few years later than originally planned? We can quickly put in there and see, well, how much of a change is that going to make? In that chart we saw the money going down over time.
Bob:
Here’s the decision center, and this is where you can see, we can toggle these. There’s the home remodel because they want to do a remodel and I can toggle that switch off. I’m trying to toggle it. There you go. It will toggle that switch off, and you’ll watch, this should raise the number a little bit. Okay, there we go. It will raise or lower the number depending on how I toggle this switch. There’s where they want to buy a new car, and I can toggle that switch to on.
Shawn:
Give it a second.
Bob:
All right. Got it.
Shawn:
You have to give it a second.
Bob:
You can see where that will change the number as well. As we toggle these switches back and forth, we can go into. This is where we manage what we call techniques. Look at this. This is very powerful. We can add any other expense, additional expenses, gifts to charities, gifts to a person.
Shawn:
We can also do some positives, like adding additional income or selling some property. We’ve got changing growth rates or some assumptions on retirement ages. So there’s a lot, which we don’t want to go over this for an hour.
Bob:
We’re pretty much done. We are done for today and showing you how this works. What’s interesting about this too, Shawn. Is people have been amazed at how fast I am. I can do most of this information in just two or three hours, we can get this in. The financial plans nowadays are much cheaper than they used to be.
Shawn:
The added benefit, Bob, of after you’ve gone through this the first time, if someone is working with us as a client, they come back a year or two later, like you said, we’re not starting from scratch. We’re just, let’s confirm a few things. Has your income changed? Have any of your average living expenses changed? Were you going to sell anything? We make a few quick adjustments and now we’re ready to go. So what is it we’re trying to decide?
Bob:
Shawn, I love this thing. Some people are like, man, you are a nerd, Bob, you really love it, but I do. People watch me operate and it is, it’s nearly from muscle memory. I’ve been doing it for over 15 years and it’s just, I’m so fast in it. You can’t throw anything at me that I’m not going to be able to put that in and show you how that’s going to affect your plan.
Shawn:
Well, I’m glad you like it, Bob. I think you’re, I think you’re probably in the right career then.
Bob:
Well, I hope this has helped y’all a lot to see just how innovative and integrated financial planning is today. If you want some help, give us a call. We’d love to come alongside you as Christian Financial Advisors and help you. Our phone number is (830) 609-6986. You can call or text that number during business hours central standard time, or go to our website. A lot of good information on our website about how we do all this. There’s a financial planning page. It goes into all these areas as well. That’s christianfinancialadvisors.com. Anything you want to say before we end, Shawn?
Shawn:
Yeah, I was just going to say, if you’re watching this and you really like this type of a presentation where we kind of dive into something just more real world instead of kind of talking more theoretical. Not showing as much on screen, let us know in the comments. If there’s any other topics or categories similar to this that you’d love to have us cover. Let us know in the comments. Like Bob said, call or text us. Thank you God bless.
[CONCLUSION]
That’s all for now.
We invite you to listen to all of our past episodes covering many financial topics from a Christian Perspective. To make sure you don’t miss any of Bob’s upcoming episodes you can subscribe to Christian Financial Perspectives on iTunes, Google Play Music, Spotify, or Stitcher. To learn more about integrating your faith with your finances, visit ciswealth.com or call 830-609-6986.
[DISCLOSURES]
Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, also known as Christian Financial Advisors, a registered investment advisor. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host, Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 147 – Tools Needed In Your Financial ToolboxTools Needed In Your Financial ToolboxLearn about the essential tools you should have readily available in your financial toolbox.
More episodes >>
Bob and Shawn cover an array of tools that you should always have readily available in your financial toolbox. Most of you listening probably have the essential tools at home for basic tasks – a hammer, screwdriver, drill, pliers, and a level. Just like there are essential tools that aid in 90% of tasks around the home, we also have essential “tools” that should be readily available when it comes to finances.
Some of your financial toolbox essentials include having a safety net (i.e. savings) in case of emergencies. Other fundamental tools might be having the right life insurance for your family size, lifestyle, and current expenses. All of these and more are covered in this important episode on the tools needed for your financial toolbox.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodeEPHESIANS 6:13-17 NASBTherefore, take up the full armor of God, so that you will be able to resist on the evil day, and having done everything, to stand firm. Stand firm therefore, having belted your waist with truth, and having put on the breastplate of righteousness, and having strapped on your feet the preparation of the gospel of peace; in addition to all, taking up the shield of faith with which you will be able to extinguish all the flaming arrows of the evil one. And take the helmet of salvation and the sword of the Spirit, which is the word of God.
PROVERBS 24:3-4 MSGIt takes wisdom to build a house, and understanding to set it on a firm foundation; It takes knowledge to furnish its rooms with fine furniture and beautiful draperies.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPT[INTRODUCTION]
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with the biblical Worldview. Here’s your Christian Financial advisor’s host, Bob Barber and his co-host, Shawn Peters.
[EPISODE]
Shawn:
Welcome to another episode of Christian Financial Perspectives. We’re so glad that you joined us today. Whether you’re watching right now or you’re listening to this, thanks for being here. We noticed that about 80% of those watching on YouTube are not subscribed. So, if you do like this video or one of our other videos, I’d love for you to smash that subscribe button and like this video. Today we are going to be covering tools you need in your financial toolbox. If you like things like this as well as other topics related to finance from a Christian perspective, then again, please hit that subscribe button. Bob, what do we got for today?
Bob:
Well, Shawn, the reason I came up with the title, “Tools in Your Financial Toolbox,” was just about a week ago we had this big storm here in Texas and we had an ice storm. It got on one of them and caused those branches to come down, and I had a branch fall off. It hit my water control valve for my sprinkler system and water was shooting up everywhere. I live out in the country. Well thank goodness I had the tools I needed to fix the problem because I couldn’t have gotten a plumber out there. It was 31 degrees outside. It was a mess, but I was able to get that leak stopped and was able to cap the leak. I thought about, I needed those tools right then, and had I not had those tools, I would have been in trouble. Anyway, see we got tools here. We got, we got a tape measure, got a hammer, screwdriver, got a level. As a matter of fact, we were using a level back here and to level things around here, so we had the tools needed. I think about this, do you have the tools that you need for your toolbox? We’re going to think, talk about the tools in the…
Shawn:
The financial toolbox.
Bob:
Got to make sure we put that in there for your financial toolbox. Shawn, I know you were thinking like, okay, Bob, what scriptures would go with this? It was interesting that one that you came up with, so share that scripture since this is Christian Financial Perspectives.
Shawn:
The one that I came up with was Ephesians 6:13-17. This is from the NASB. “Therefore, take up the full armor of God, so that you will be able to resist on the evil day, and having done everything, to stand firm. Stand firm therefore, having belted your waist with truth, and having put on the breast pr breastplate of righteousness, and having strapped on your feet the preparation of the gospel of peace; in addition to all, taking up the shield of faith with which you will be able to extinguish all the flaming arrows of the evil one. And take the helmet of salvation and the sword of the Spirit, which is the word of God.” Now, some of you may be asking, why am I talking about the armor of God when we’re talking about financial toolbox? Well, what came to my mind was that what is true in the physical was first true in the spiritual.
The scripture tells us, that we need to equip ourselves. And there’s a lot of different pieces to the armor of God. It’s not just a shield. It’s not just a helmet. There’s a lot of different pieces to it. Each have their own purpose and function. If that’s true in our spiritual battle, why wouldn’t it also be true in the physical life here? In this case, finance. Just like the spiritual battle in finance, there are certain tools that you need in order to be properly equipped to fight the financial battle, if you will.
Bob:
That shows the word of God is living and active. It can apply in so many different areas of our lives. I had one from Proverbs. You know I’m a big Proverbs guy. In Proverbs 24: 3-4, and I got this from the message. Which I know you like the message Bible. “It takes wisdom to build a house, and understanding, to set it on a firm foundation; It takes knowledge to furnish its rooms with fine furniture and beautiful draperies.” I look at that wisdom and prudence and knowledge is so important to have the right tools. In this case we’re talking about financial tools. Shawn, I came up with what I feel are eight essential tools that you need to have in your financial toolbox.
Shawn:
Well let’s go with the first one then. The first one we have is estate plan. So, Bob, do you have an estate plan?
Bob:
I do. I have a very good estate plan as a matter of fact, and how it’s going to be handed to the next generation with wisdom. Shawn, I’ve updated that estate plan three times in just the last 10 years. It’s very important that your estate plan be updated. We’ve done podcasts on estate plans. If you’ll look through our archives, you’ll find some of the ones that we’ve done. Especially someone with young children like you and Jenna have, who’s going to take care of the children? How are things going to be passed down to the next generation? For Rachel and I who’ve been accumulating wealth for 38 years now, and it has accumulated in quite an amount. I want to be very wise and prudent how I hand that down to the next generation.
Shawn:
Also making sure that you don’t pay to Caesar anymore than you have to pay to Caesar.
Bob:
That is the truth. That’s the truth. At a certain point, he starts taking 30 and 40%, the government does on that estate plan. I think that is a, that’s one of the most important things of the tools. Like a hammer, we know is a very important tool in building a house. That is such an important tool, and Shawn, you know and I know about 80% probably of our listeners do not have an estate plan. Which is absolutely insane. It’s crazy.
Shawn:
Well, we’re going to have some links in the description to give you some resources specifically on that. Nowadays there’s really no reason to not have an estate plan. At the very least, having a basic will and some information, but better yet, actually having some sort of estate plan.
Bob:
We’ll put that link up for the podcast, the actual podcast. We’ve had several of them on estate planning.
Shawn:
We’ll link to some of the podcasts as well as some of the resources for you. Now the next one would be because as we said, there’s eight tools. If all you have is a hammer, everything starts to look like a nail. Our next one is in addition to the estate plan, you have a retirement plan. The estate plan, Bob, I guess you would say is planning for when you’re gone. When you go to be with the Lord. But for the retirement plan is, well either you’re in retirement or hope or you’re getting to retirement. What are you going to do while you’re no longer working, but still here?
Bob:
In preparation, just like with that water leak I had preparation. A retirement plan is not something that you build in just a matter of days or weeks, or even years. It’s many, many years that it takes to build a retirement plan, and putting money into that 401k, that 403b, that thrift savings plan, etc. We’ve spent again, entire episodes on a retirement plan. We’ll find a few of the podcasts we can put up again on the screen. Shawn, this is why it’s so important as we talk about this too, that those that hear us on the podcast, they need to go see us on YouTube too. They’ll get a lot more by seeing those resources.
Shawn:
We’ll have that in the description as well. So the next one, financial plan. So we’ve got financial plan with expected and unexpected expenses built into the plan in the future. For example, automobile, home, primary home repair, college expenses, medical expenses. Why don’t you talk me a little bit about Bob.
Bob:
The financial plans that we do here are really living, active, and breathing just like scripture is. We can put those things into the plan. Like, I want to do a home repair in two years. How’s that going to work within your financial plan? We have college expenses maybe coming up for grandchildren or children in 8 or 10 years or 15 years. They want to go maybe here in Texas. Maybe they want to go to Texas A&M. Well we can actually put that in our system
Shawn:
And see if you’re on track for those things.
Bob:
That’s right. Medical expenses are the same way. Maybe there’s some upcoming medical expenses, and it’s good to be prepared for unexpected medical expenses.
Shawn:
I think a good one for that would be is if you do have, say a higher deductible medical plan. Well, making sure all right, during the year, if we have to actually hit that full deductible before things kick in, how’s that going to affect your savings? How’s that going to affect your actual planning. Are you going to be okay? If not, well then you definitely need to be working on having enough saved up for that.
Bob:
And how you build those cash reserves. Cash reserves are so important for these kinds of unexpected expenses, but maybe even like we have here a primary home repair. Maybe a remodel that’s coming up. How does that fit into your plan? You can’t just go into that in the dark and say, well, we’re just going to take it out of here because everything you do take out of here is going to affect the future.
Shawn:
That’s right.
Bob:
Our financial plan will show that.
Shawn:
Bob, I’ll let you take number four.
Bob:
Risk management insurance plan. This really has to do with your life insurance, health insurance, disability, home, auto, and liability insurance. I’ve seen more times than not inadequate coverage when it comes to these areas.
Shawn:
Especially when it comes to disability. Even if people do have proper insurance and say, life and health and home. Even of course auto. People are usually deficient when it comes to disability, which is bad because the statistical chances of you needing disability insurance versus life. Well, life is going to be one time. The chances of you being unable to work for a period of time is a lot higher than you actually passing away, especially the younger you are.
Bob:
What I see in life insurance too many cases? I’ll see a breadwinner that maybe makes a $100,000 a year and all he has is $250,000 in life insurance. And the family is relying on that breadwinner’s income.
Shawn:
So you’re really looking at two and a half years tops of income.
Bob:
They need at least a million of coverage, and that can be proved with a financial plan. I see auto policies that don’t have enough coverage too. Like, uninsured medical, $5,000, you can push that up to 50 for pennies on the dollar. It doesn’t take a lot. All right, number five.
Shawn:
The balance sheet financial statement: so your assets, liabilities, and you should have something that updates automatically daily. Like for our clients, we use eMoney, which is a software that we have for all of our clients. In addition to the assets that we’re managing for clients, they can put in their bank account, their other 401k retirement accounts.
Bob:
They’re all linked there.
Shawn:
Basically pretty much anything that has an online login you can put in to where it updates every single day. One of the big benefits of that too, especially when it comes into the estate planning and retirement planning, is when you’re looking at making a decision, or something should happen to you. Your family knows exactly what is the value of everything because it’s all updated every day. As opposed to, well, I haven’t updated in three years, so who knows what the value is. So big benefit.
Bob:
By the way, next week we’re going to cover e-Money and we’re going to have a lot as it’s live, and you’re going to see all this living and breathing plan. Which is so neat today, which we used not to have years ago. Number six is having a budget. That’s got to be a part of your financial toolbox.
Shawn:
Again, you should have some sort of software that tracks daily, because otherwise, if it gets out of date, it’s not very useful. It should be a kind of a given right? The next one is a savings and investment strategy.
Bob:
Well, I’ve mentioned that already, but you have to have those strategies for, like we mentioned up earlier for the retirement plan, for your savings plan, for the, unexpected expenses. Let me see, what else? Like a second home maybe if you wanted to buy one, or even a car. Maybe you want to buy a car in three years. You need to be putting that aside. That’s what I mean by savings and investment strategy for now and the future. I said savings and investment, not just investment, not just savings. Then we come down to the eighth tool. We’ve got four tools right here, but you need eight tools in your toolbox, and the eighth tool is…
Shawn:
Fiduciary based financial advisor to guide you through all the financial mine fields and help you with all these financial tools. As we’ve said before on the program in Proverbs: “Plans fail for lack of counsel, but with many advisors, they succeed.”
Bob:
Shawn, when I was learning, as you know I had a dad that built homes and my brother built homes, and I learned starting at 14 years old and I started framing homes and trimming out homes. They taught me how to use these tools. The eighth part of this in your toolbox is having that fiduciary fee-based advisor to teach you how these tools work. The tool’s, just a tool. That tool’s just sitting there until you know how it works, right? I mean, I know how a level works, but some people might not know you’re supposed to have the bubble in the middle, you know? You can put it up against the wall this way or this way, or even a 45 degree angle. You can use that tool in different ways, and that’s where what a fiduciary fee-based advisor will help you do.
Shawn:
Using that analogy, if you don’t know how to do anything in plumbing or ac repair or carpentry, and you go out and just spend $2,000 or $3,000 on the works from Home Depot or Lowe’s, and you get this huge toolbox and you get all the tools and you have no idea how to use them, is that going to help you?
Bob:
You’d need to make a lot of mistakes.
Shawn:
You also need to learn how to use the tools. It’s not just about having the tools, but how do you use them correctly.
Bob:
We hope that these eight tools have helped you, and don’t forget to tune in next week as we discuss and show you a presentation on screen of how all these tools fit into an integrated, interactive financial plan using the technology today. That changes as you do daily, monthly, annually. It’s all those life changes. This is what I love about financial planning today. So different when I started. Where it was just, you gathered information, you built the financial plan, you printed it on a printer, put it in a binder, there you go. It wasn’t living and breathing like it is today. So next week will be a really great program. If you haven’t tuned in any, we want you to tune into that one too.
Shawn:
One way you can get a nice little reminder about when that video is published is to hit that subscribe button. If you’re currently watching and you’re not a subscriber, and based on the numbers, that’s basically 8 out of 10 people Then please do hit that subscribe button. It definitely helps us. Helps out other people as well who might be looking for this kind of content, and again, thank you so much for joining us.
Bob:
If you want us to help you with how to use your financial tools, Christian Financial Advisors would love to help. Our phone number during business hours is (830) 609-6986, or you can text that number during business hours as well, 8am to 5pm Central Standard Tme, or you can find us on the web@christianfinancialadvisors.com.
Shawn:
Thanks again for joining us. God bless.
[CONCLUSION]
We invite you to listen to all of our past episodes covering many financial topics from a Christian Perspective. To make sure you don’t miss any of Bob’s upcoming episodes you can subscribe to Christian Financial Perspectives on iTunes, Google Play Music, Spotify, or Stitcher. To learn more about integrating your faith with your finances, visit ciswealth.com or call 830-609-6986.
[DISCLOSURES]
Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, also known as Christian Financial Advisors, a registered investment advisor. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host, Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 146 – The Different Types Of Financial Advisors146 – The Different Types Of Financial AdvisorsLearn about the differences between different types of financial advisors.
More episodes >>
Bob and Shawn discuss the many types of financial advisors that exist in our world today. Not all financial advisors are the same, just like not all doctors are the same. And just like with doctors, financial advisors can be all encompassing (like a general practitioner), or they can focus on one area like a podiatrist would (for example, financial planning). It is important to know the type of financial advisor you are working with, understanding their limitations, knowing their specialties, and finding one that hits all the checkboxes for your financial and investment needs.
Along with being all encompassing or having a more generalized focus, there are also different ways that financial advisors are paid. This is an important feature to consider when choosing an individual or firm that has your financial future in their hands. Bob and Shawn discuss all of the above by breaking it down into a way that is easy to understand.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodePROVERBS 12:1G (MSG)Fools are headstrong and do what they like; wise people take advice.
PROVERBS 14:24 (MSG)The wise accumulate wisdom; fools get stupider by the day.
PROVERBS 15:12Know-it-alls don’t like being told what to do; they avoid the company of wise men and women.
PROVERBS 15:22 (MSG)Refuse good advice and watch your plans fail; take good counsel and watch them succeed.
ECCLESIASTES 7:11 (MSG)Wisdom is better when it’s paired with money, Especially if you get both while you’re still living. Double protection: wisdom and wealth! Plus this bonus: Wisdom energizes its owner.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTIntro:
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with a biblical worldview. Here’s your Christian Financial advisor’s host, Bob Barber and his co-host, Shawn Peters.
Shawn:
Welcome to another episode of Christian Financial Perspectives. We’re so glad that you joined us today or tonight, depending on what time it is when you’re watching this. If you enjoy videos on financial topics from a Christian perspective with scriptures, we’d love for you to smash that subscribe button, like this video, and maybe share it with your friends. Now, today we’re going to be covering the different types of financial advisors. Bob, can you give us a little overview on this? We’ve kind of covered something like this before, right?
Bob:
Four months ago, actually, nearly to the day we did a program called “21 Questions to Ask a Financial Advisor.” I believe this is goes a little bit deeper because you got the questions down, but what about the different types of financial advisors?
Shawn:
So, a little more explanation of, what are the actual different types? Not from the perspective of here’s the list to bring with you.
Bob:
That that’s right. Different advisors fit… There’s different advisors for different people.
Shawn:
Different needs and wants.
Bob:
Exactly. Now Shawn, I know that you came up with some interesting scriptures from the Message talking about seeking advice. This is my son-in-law that came up with this. These are some pretty tough scriptures, so he’s going to go over them. I think they’re fun though.
Shawn:
I think if scripture is convicting, then maybe there’s something there for it. Maybe there’s something there for it. Now I put these in here from the Message. I know everyone probably has their preferred translation for the Bible, but I personally like the NASB as well as the Message because NASB is a little more of a direct word for word kind of like King James. A little more direct from the original Greek and Hebrew. The Message, I like it because the translation is more of here’s a couple verses together. What was the original intent of the actual original Greek and Hebrew? We have one word for love, but Greek has what, four words for love? Anyway, that’s why I like the Message.
Bob:
Sounds like some of your background when you went to Liberty University, where you found out about this too.
Shawn:
That’s why I like the message. It’s a little more hard-hitting if you will, and to the point.
Bob:
Well we are Christian Financial Advisors.
Shawn:
With that warning here we go. Here’s Proverbs 12:15, “Fools are headstrong and do what they like; wise people take advice.” I think these scriptures on advice and council kind of fit with seeking a financial advisor.
Bob:
I want to be that wise person.
Shawn:
Proverbs 14:24, “The wise accumulate wisdom; fools get stupider by the day.”
Bob:
Wow.
Shawn:
I think probably the NASB or some of the other translations might say, “The wise build wisdom and fools neglect it.” That might be a little more diplomatic way.
Bob:
Fools despise wisdom and knowledge. That’s what it is. I remembered that because I remember the scripture now.
Shawn:
Thats sounds a little more of a nice way of saying it. Proverbs 15:12, “Know-it-alls don’t like being told what to do; they avoid the company of wise men and women.” Then we have, I’ve got two more for you.
Bob:
That’s one of my favorite scriptures, but from the NIV version.
Shawn:
The Proverbs 15:22?
Bob:
Plans fail for lack of counsel, but when good advice succeed.
Shawn:
In the Message, “It’s refuse good advice and watch your plans fail; take good counsel and watch them succeed.”
Bob:
I like success.
Shawn:
The last one, Ecclesiastes 7:11, “Wisdom is better when it’s paired with money, Especially if you get both while you’re still living. Double protection: wisdom and wealth! Plus this bonus: Wisdom energizes its owner.”
Bob:
So, we’re hoping to give wisdom today.
Shawn:
We’re hoping this wisdom will not offend you, but will energize you, and make you more prepared to find the right financial advisor.
Bob:
The average person really doesn’t know there’s all these different types of financial advisors out there. They Google financial advisor, or with us, the way that everyone’s always calling us is they’re searching Christian financial advisor. That’s the name of our company.
Shawn:
Depending on where you’re located, depending on who’s paying for paid ads, people might just see, oh, there’s something I was looking for. It sounds right, but it’s not all the same. Bob, what are some of the options first on how advisors are paid?
Bob:
Well, I wanna say, first of all, Shawn, there’s not necessarily a right or wrong way here. I mean, if one advisor operates this way and another advisor operates either way, that’s just the way they choose to do business.
Shawn:
You would say there’s pros and cons really.
Bob:
There is no matter which one. The first thing I think is important to understand when you’re looking for a financial advisor, and a lot of people are looking today, especially as more and more people retire. We had the bear market last year, there’s a lot of switching that goes on after that. You have a bad year and everybody’s like, I wanna go find a new financial advisor. The first thing is how the advisors are paid. Are they commission based or fee-based only, or are they hybrid? Now, in each one of these, we’re going to point out what Christian Financial Advisors is in these three. The commission based is how they’re paid. Whatever they put you in, they’re paid a commission.
Shawn:
A one time fee, and depending on what the product is, depending on the situation, they’re paid anywhere from say a few percent, 5%, maybe up to 10%.
Bob:
It could be, it could be that high Some of them have what’s called a trail commission that they could get to. Maybe 25, what I say a quarter, or 25 basis points. Nobody else knows what that means, but we do. A quarter percent up to maybe a half or even one. Then there’s the fee-based advisor, and that’s what we are. We’re fee-based, fiduciary only based advisor, and that’s where we are actually paid by the client. We’re not paid by anyone else. Then you have what’s called your hybrid model. A lot of advisors work from the hybrid model, meaning that they handle commission based products and they charge a fee also. That’s what you want to ask when you’re looking for an advisor: Are you commission based? Are you fee-based? Are you a hybrid of the two?
Shawn:
Fee based only, I think would be the idea.
Bob:
Fee based only.
Shawn:
Are you a hybrid where you can sell commissionable products and you offer ongoing financial advice for a percentage fee?
Bob:
A fee based is usually fiduciary based. It is always what’s in the best interest of the client because the client’s the one who’s paying you. You should do what’s in the best interest of the client, not what’s in the best interest of the product that you’re selling.
Shawn:
Fee based only would also typically be associated with the investment management? Because typically it’s related in some form or fashion to the assets that are being managed.
Bob:
The next area, there’s three of these areas too. Some advisors are very product oriented. That’s going to be mostly your commission based advisors. That’s the ones that are going to sell like annuities, life insurance, alternative investments, like a real estate investment trust or maybe an oil and gas investment. They’re going to be financial planning oriented, or investment manage oriented, or they can be both.
Shawn:
Financial planning and investment oriented?
Bob:
That’s what we are Christian Financial Advisors. We’re both financial planning oriented and investment oriented, because we believe the two need to go together.
Shawn:
Our focus here is, investment management is our bread and butter, if you will. That’s our main focus. We do biblically responsible investing, and as part of that, depending on assets under management, we offer different levels of financial planning as a value added services. As an additional, by the hour, you can work with us for financial planning.
Bob:
Just to say this, so everyone will know. If you have under $300,000 of management with our firm, financial planning is by the hour. If you have over 300,000, it’s included. All that is on our website how our feeds are structured. Which by the way, we have a blended fee structure that the more you have with us, the lower the fee goes.
Shawn:
Next we’re going to cover some portfolio styles. This is of course assuming someone is doing investment management. What are our first options, Bob?
Bob:
Well, the first is the buy and hold portfolio style. That’s where most of your advisors fit. They’re going to put you in an asset allocation model. It’s going to be either a growth model, a balance model, or a conservative model. They’re going to put you in that, it’s going to be a buy and hold through thick and thin. Down markets, up markets, et.
Shawn:
Do they usually have some sort of automatic rebalancing where say like, every quarter it will rebalance and the positions don’t change, but it just rebalances regardless of what’s going on?
Bob:
That’s right. We just did the program about a month and a half, two months ago on how to diversify. The next style of a financial
Shawn:
“Diversification 101” for those who wanted to check that out.
Bob:
Oh, is that what it was? It was a three-part series. The next style is what we refer to as a tactical portfolio style. That’s what we use here.
Shawn:
How is that different than the buy and hold?
Bob:
The tactical is going to attempt to sell at highs and buy at low’s.
Shawn:
So we don’t, we wouldn’t automatically rebalance every quarter in a style like that. It would be when needed.
Bob:
Now, as an example of that, in October of 2021, when the market’s were at an all time high, they continued to go higher for a couple months. I got out a little early. I have to admit, but we took our stock exposure overall and nearly cut it in half. You remember when we did that. Then last year when the markets were way, way down.
Shawn:
That was in our moderate balance accounts, we didn’t necessarily go that low in like our aggressive.
Bob:
No. We went down to I think about 75% from 95%. We’ve entered back in and we entered back in when the markets went down. That’s a tactical style of investing.
Shawn:
If I may interject Bob here, I believe I’ve heard you say many times that when you’re deciding whether or not to hold on to the market continuing to grow, when it seems like the momentum is slowing down, the pigs get fat and the hogs get slaughtered.
Bob:
It is. That’s the old style.
Shawn:
I apologize to our vegetarian visitors or our viewers. It’s just an analogy.
Bob:
I’m very Texan, very country boy, and that’s an old saying I’ve always heard. I have kind of a Warren Buffet style when the markets are at all time highs, the emotions chart. We need to show that emotions chart right now, and you’ll see that. When everybody’s wanting to buy, buy, buy, that’s when I’m saying it’s time to sell. When everybody’s wanting to sell, sell, sell, that’s when I wanna buy more.
Shawn:
You never really hit that top full, like the top, top top. You’re never really buying at the absolute bottom, but it’s using that kind of an idea that, contrarian theory helps to try to get near the top and try to get near the bottom is the goal with that.
Bob:
We’re active, that’s a tactical style portfolio that’s very actively managing. It’s not a buy and hold. Then some advisors also, what they’ll do is they’ll hire third party managers to manage.
Shawn:
We got the two different styles. We got buy and hold, we have tactical, and then we have two different ways of how those styles are managed, right? Either a third party. Which would mean someone else is monitoring that either buy and hold or tactical on your behalf, or like what we do here at Christian Financial Advisors, we actually manage that in-house. Bob of course is in charge of our investment management. He’s been doing this for three decades or so for a little bit of experience.
Bob:
Too long nearly, but I hope that I’ll be doing it in another 20 years. That’d pick me up to 50 years wouldn’t it?
Shawn:
Yeah. Keep you active.
Bob:
It sure would. That’s how we do it here. Next the type of advisors are, there’s the independent advisors which is what we are.
Shawn:
We don’t have a big parent company that tells us specific investment strategies or portfolios or types of holdings that we have to use. Then you have your larger captured advisory firm. What do you mean by captured?
Bob:
Well, that’s going to be your well-known names. I’m just going to name some of them. It’s okay I think. Like Wells Fargo advisors, or Merrill Lynch.
Shawn:
Maybe they’re associated with the bank or Edward Jones.
Bob:
Those are what we refer to as captured advisory firms. I’m not saying there’s a right or wrong on either way, but they’re a lot larger and they have to stick by that style.
Shawn:
It’s kind of the difference between an independent local restaurant versus some sort franchise. Which again, nothing wrong, like they both serve food, but just depends on what you’re looking for.
Bob:
That’s correct That’s right.
Shawn:
Then the next one we have what we would say values versus profit only approach.
Bob:
That has to do with investing. We’ve spoke a lot about this. I mean, you can go back into our archives and find a lot of information about Biblically Responsible Investing. That’s our approach here. We strive to stay away from companies that are involved in immoral agendas according to biblical guidelines, and we strive to look for the companies that are doing good.
Shawn:
Even if they’re not Christian, just that they’re making a positive impact on society. Really those are the two options. You have investing in a company regardless of what they may support and being involved in just do the financials look good. Then what we do is we look at, are the financials good? But we also take the approach of what you were saying, both the positive and negative screens to look for companies that are making a positive impact on our world.
Bob:
The majority advisors are not biblically responsible. I mean that would probably, you’d probably say 90 to 95% advisors.
Shawn:
As believers, as Christians, we feel that it’s very important that what you own, what you invest in, how you make money, is just as important as making money in the first in the first place.
Bob:
That’s because of scriptural guidelines from Proverb 24:1. It says, “The Earth is the Lord’s and everything in it.” We feel like that what we’ve taught here is it belongs to God and we’re managers.
Shawn:
Therefore we should be good stewards of what God has entrusted to us. The next thing we have, is the advisor you might wanna hire or work with, are they team-oriented in their approach for clients? Or is it more individually oriented where each advisor is kind of doing their own thing.
Bob:
Anytime that client thinks I need help, they’re going to go to that individual.
Shawn:
Or do they contact the team and the team is set up in a way where maybe you prefer to talk to your advisor, but maybe if they’re not available, one of the other advisors or service team is available.
Bob:
We’re the team approach side of it. Shawn, as you know, I don’t know how to do a form. I haven’t done a form, filled out a form in 30 years.
Shawn:
You probably know how to do it. You’re just a little rusty.
Bob:
I take the team approach and hire experts in things that I don’t like to do and I’m not good at.
Shawn:
It’s called delegation.
Bob:
Plans fail for lack of counsel but with many advisors they succeed. We all have different spiritual gifts, and I like to use those gifts here in the firm. That’s why we have a team approach here at Christian Financial Advisors.
Shawn:
We work off of each other’s strengths and use those strengths to balance each other’s weaknesses.
Bob:
We just have a couple more.
Shawn:
We got the new way or the old way.
Bob:
Well, I think you could go into this first one the new way, because you’re the one behind technology here.
Shawn:
Technology driven approach, or a little more old fashioned paper print style and in-person meetings, filing cabinets. We take the technology driven approach. Whether that includes a lot of things, zoom/video meetings, depending on your preference. Things like DocuSign, electronic signatures, online accounts and portals, texting, email, having an online portal for being able to share files securely. We use a service called eMoney that allows us to do not only that, but also financial planning. Having a smartphone app, etc. I always say that technology shouldn’t replace people. What technology should do is make it more efficient for people to communicate with one another. If there’s something that a human isn’t really adding any value to, but it needs to get done, a computer should do that. Then we have more time one-on-one with people That’s what the point is.
Bob:
Because of technology, it allows us as a Christian firm to serve Christians nationwide. Even in our own hometown now, it’s funny how many people have chosen to go with the Zoom online meeting. I prefer them to come in. I like meeting with people. I’m a people person, but I can see why, especially as busy as San Antonio and Austin are. If they live in San Antonio, they like to do Zoom because they don’t wanna get on 35, and it takes 45 minutes to an hour to get here and to get back. They can just do a zoom meeting in 45 minutes total.
Shawn:
Even if Bob, it only takes 10, 15 minute drive, well round trip, you’re now talking 20, 30 minutes. If someone has an hour for lunch, so they have time, they could jump on the computer, have their meeting maybe while they’re eating lunch, and then they’re right back to it. They didn’t have to spend any time driving. That has definitely happened where people realize it’s not just because you can’t go in person, it’s just more convenient to meet digitally.
Bob:
I never realized how much we use DocuSign. It is amazing. It makes it so much easier.
Shawn:
We got our last one, right?
Bob:
Our last one.
Shawn:
Is it Christian or secular? Which we covered a little bit, but this goes in a little bit more of the advice. Is the advice simply how much money can you make and what are you saving for retirement? Or is it advice based on biblical principles?
Bob:
I got two ways. Advice based on a secular worldview or advice based on a biblical worldview. Here we want our advice, at Christian Financial Advisors to be based on a biblical worldview.
Shawn:
Otherwise known as kingdom building. We want to be focused on how are you building the kingdom? Not just saving for retirement and preparing for that, but how is what you’re doing going to impact after you’re gone, and impact the kingdom of God?
Bob:
Well, there you go. That’s a lot of information to go with. You might wanna watch this a couple of times. Remember I pointed out at the beginning, you might wanna go back to episode 130, which we did three or four months ago. That was on “21 Questions to Ask a Financial Advisor”. Hopefully we’ve helped you to understand all the different types of financial advisors. Then you can go back and look at that and the questions to ask once you choose that financial advisor. Well, that’s going to do it for today.
Shawn:
Thanks again for joining us and as always, you can visit our website, christianfinancialadvisors.com, or you can call or text us at during business hours. (830) 609-6986. God bless you, and again, thanks for joining us.
[CONCLUSION]
We invite you to listen to all of our past episodes covering many financial topics from a Christian Perspective. To make sure you don’t miss any of Bob’s upcoming episodes you can subscribe to Christian Financial Perspectives on iTunes, Google Play Music, Spotify, or Stitcher. To learn more about integrating your faith with your finances, visit ciswealth.com or call 830-609-6986.
[DISCLOSURES]
Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, also known as Christian Financial Advisors, a registered investment advisor. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host, Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 145 – BRI Part 3: Why It’s ImportantBRI Part 3: Why It’s ImportantLearn the reasons why Biblically Responsible Investing is so important.
More episodes >>
Part 3 of our three part series on Biblically Responsible Investing delves into the importance of investing with your values, especially as a Christian. Bob and Shawn present several Bible verses that go hand in hand with Faith Based Investing. If you wouldn’t outright support certain anti-Biblical agendas with your money, then why would you want to support them secondhand through your investments in certain companies?
After all, if you truly believe that “God owns it all”, then investing your money with your Christian values in mind is something that you probably want at the forefront. Using BRI as a way of investing helps make a difference in the marketplace, and it can give Christian investors a peace of mind in that they are supporting the good in the world while avoiding the negative.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodePSALM 24:1The earth is the Lord’s, and everything in it, the world, and all who live in it.
2 CORINTHIANS 6:17Therefore, “Come out from them and be separate, says the Lord. Touch no unclean thing, and I will receive you.”
EXODUS 20:13-14You shall not murder. You shall not commit adultery.
PSALM 139:13For you created my inmost being; you knit me together in my mother’s womb.
MATTHEW 5:13-16You are the light of the world. A town built on a hill cannot be hidden. Neither do people light a lamp and put it under a bowl. Instead they put it on its stand, and it gives light to everyone in the house. In the same way, let your light shine before others, that they may see your good deeds and glorify your Father in heaven.
1 PETER 1:15-16But just as he who called you is holy, so be holy in all you do; for it is written: “Be holy, because I am holy.”
EXODUS 20:3You shall have no other gods before me
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPT[INTRODUCTION]
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with a Biblical worldview. Here’s your Christian Financial Advisor’s host, Bob Barber and his co-host, Shawn Peters.
[EPISODE]
Shawn:
Welcome to another episode of Christian Financial Perspectives. Today we’re going to be covering part three of our three part series on Biblically Responsible Investing. Now, if you like videos on finance and investing related topics, but from a Christian perspective using biblical principles, I would encourage you to smash that subscribe button and like this video. Now, I want to do a quick recap. We’re going to be covering part three of course today, but part one, we covered the definition of Biblically Responsible Investing, the history of it, how it’s not ESG, and the many biblical responsible investment choices that we have today. In part two, we actually covered the positive screens that we look for in Biblically Responsible Investing and the negative screens, and the technologies that can be used to actually do these screens with examples. If you haven’t already, we’re going to have links in the descriptions and we should have those videos shown on screen. We definitely encourage you to go watch those, but otherwise, you have been warned. Spoilers ahead for those of you who haven’t watched those two episodes. Bob, what are we covering today?
Bob:
Those are some good episodes. They really cover a lot. Especially with those evaluator and inspire reports that we have.
Shawn:
We’ll wait a second. Go ahead. Go watch those. All right, if you’re still here, you’ve either watched them, or you didn’t listen. Let’s go on to part three.
Bob:
Today we’re going to talk about why Biblically Responsible Investing is so important, especially for a Christian with a biblical worldview. We’re going to go into the scriptural basis and why, what scripture says, and that is so important about being, BRI or biblical responsible.
Shawn:
That’s the B in Biblically Responsible Investing.
Bob:
Hey, there you go. The Bible. That’s exactly right. How BRI makes a difference even in the marketplace. That’s where we want to make a change, a positive change.
Shawn:
We mentioned that a little bit in part two.
Bob:
Why is BRI so important, Shawn?
Shawn:
Well, it sheds light in the middle of the darkness and exposes it.
Bob:
It really does, doesn’t it? When you come into the marketplace and you’re making a difference with how you even invest, and you’re saying , I’m not going to invest in these companies involved in immoral activities, and I’m actually going to look for companies that are abiding by biblical values. It’s just as important as voting for a conservative candidate when it comes to Biblically Responsible Investing. Shawn, you remember we did the podcast on “Voting Right, Investing Ieft.”
Shawn:
Which again, comes down to if voting is important to you, then investing should also be important to you because that is the way you are voting with your dollars, and affecting our society, our culture. The next one is, it’s very scriptural, which we’re about to cover those scriptures.
Bob:
It aligns with a Christian worldview.
Shawn:
Finally, Biblically Responsible Investing is pro-life, pro-family, and pro God. It gives light to darkness.
Bob:
The scriptural bases for BRIs, there’s several that we’ve picked, but there’s literally hundreds that we could pick from.
Shawn:
Can I get dibs on this first one?
Bob:
You sure can.
Shawn:
I love this one. Psalms 24:1, “The earth is the Lord’s, and everything in it, the world, and all who live in it;” I almost said that one earlier.
Bob:
You’re getting it memorized because we spend a lot of time on that. I believe that is probably the number one scripture when it comes to stewardship in the Bible. If we do believe that God owns it all, it’s his, and we are managers, this is a true scriptural basis for being biblically responsible.
Shawn:
Biblically Responsible Investing according to the scripture, it’s just one piece of the puzzle. The idea is that if everything, the world and everything in it, and all who live in it belongs to the Lord, then every area of your life is an act of worship. What you do from day to day, your finances, everything.
Bob:
Spiritual decisions for a Christian or financial decision, and vice versa. Financial decisions should be spiritual ones. 2 Corinthians 6:17 is a well-known scripture and it says, “Come out from them…”, from the world, from the, from the secular worldview. “Come out from them and be separate, says the Lord. Touch no unclean thing, and I will receive you.” This is truly what we’re trying to do with Biblically Responsible Investing; by being separate and not participating in the fruitless deeds of darkness.
Shawn:
Exodus 20:13-14, “You shall not murder, you shall not commit adultery.” That goes back to a couple of the negative screens and why we say that we shouldn’t be supporting companies, or supporting abortion, or giving to that.
Bob:
Fetal tissue research. Using the parts from babies. Pharmaceutical companies do that. We don’t want to invest in those companies. We steer clear of that. Let’s go find the companies that are doing good. Pharmaceutical companies that are doing good, like cures for schizophrenia, and things like that.
Shawn:
Then the other one, you should not commit adultery. Well, Jesus said if you lust after a woman in your heart, you’ve committed adultery. I’m pretty sure pornography would, maybe pornography the word is not mentioned, but pretty sure that’s covered by that scripture.
Bob:
We showed last week how many companies are involved in a direct or indirect way in the distribution, or production of pornography. I think if you go back and you watch part two, you’ll be very surprised finding which companies these are. Another one is Psalms 139:13, “For you created my inmost being; you knit me together in my mother’s womb.” This is a pro-life scripture. It’s as pro-life as they come. Biblically Responsible Investing is pro-life. It’s looking for companies that are helping life, not companies that are tearing it apart. It completely, like I say, steers away from companies like Planned Parenthood. If a company’s giving money to Planned Parenthood, we’re not going to be involved in that company.
Shawn:
Matthew 5:13-16, “You are the light of the world. A town built on a hill cannot be hidden. Neither do people light a lamp and put it under a bowl. Instead they put it on its stand, and it gives light to everyone in the house. In the same way, let your light shine before others, that they may see your good deeds and glorify your Father in heaven.”
Bob:
You think about that scripture, right? We are being salt and light when we’re deciding to be biblically responsible with the investments that God owns in the first place. 1 Peter 1:15-16, “But just as he who called you is holy, so be holy in all you do; for it is written: ‘Be holy, because I am holy.'” Another really strong scripture that backs up being biblically responsible.
Shawn:
Be holy because I’m holy also makes sense because we’re made in God’s image, so should we not try to reflect his nature, his character? Then the last scripture in this group is Exodus 20:3, “You shall have no other gods before me.” I always think of that one as if you don’t give God your finances as well, you’re effectively saying that God is Lord of your life except finance. Finance is Lord of your life in that area.
Bob:
I worry sometimes. I go to a Baptist church where we put them all the way well, you gotta go down into the water and then you come up. Except last year when we were having a drought, I don’t know about that. We had a bad drought here in Texas. I’m just kidding. Anyway sometimes I think people, they’re baptized and they kind of hold the wallet up, and they’re saying, “Well, you get everything God, but not this.” Well, Biblically Responsible Investing is really saying, “God, you get it all, including my investments,” because those investments ultimately belong to you, and I want to honor you with them.
Shawn:
God requires his people to worship, honor and glorify him alone. They are to have no other God, including the God of materialism, net worth, and rate of return.
Bob:
How BRI makes a difference. It makes a difference to me, I’ve seen this over my 27 years in, be involved in BRI Shawn. It makes a difference in my own life and in my soul. It’s taken me into a much deeper relationship with God. I have seen this, Shawn, with clients that have been with us for 20 and 25 years. Their relationship with God. This is another form of worship, like you said. It’s saying, okay, God, this belongs to you. I’ve had many clients that has taken them into a deeper relationship being biblically responsible.
Shawn:
Well it also makes sense too, Bob, because the number one, I think reason for divorce is finance related. If you and your spouse are both thinking of how do we make sure God is Lord of our finance as well? I’m not saying you won’t have problems, but it’s getting that right mindset. I would think it would grow your relationship with God and maybe reduce the chances that you have issues in your relationship.
Bob:
Another place it makes a difference.
Shawn:
To our Father in heaven. You are managing his funds with honor and glory. With His glory in mind.
Bob:
There’s no guilt feelings with being BRI. None at all. Another thing where it makes a difference is companies and Wall Street. They’re noticing. They’re noticing BRI. Shawn we talked about the history in part one and I remember when this started off with just a few thousand dollars. I remember when Art Alley, the founder of the Timothy Plan, he was a laughing stock of Wall Street. They’re like, this is not going to work. You’re crazy.
Shawn:
Who’s going to want to invest like this?
Bob:
Now there’s billions and billions and billions of dollars invested in biblically responsible companies.
Shawn:
I mean how many billion, like when you think of some of the companies that we work with a lot as well. You’ve got Timothy Plan.
Bob:
I could easily say it’s 10 billion.
Shawn:
I mean, Eventide’s got, what are they? $7 billion or so on the, $6 or $7 billion on their own. I mean we’re at least in double digits at this point of billions.
Bob:
That’s right.
Shawn:
That’s just between those three.
Bob:
You start adding it up and it is really, it is making a difference. The difference that it’s making is we’re holding companies accountable to elicit behaviors, and supporting anti-biblical agendas and behaviors. We can actually move their stock price now because BRI is getting big enough that it can move the stock price of the company. We’ve had some very positive things happen with some Fortune 500 companies that they were starting to support some of these illicit behaviors. We said we’re going to sell your stock if you continue to do that, got ahold of the finance department. Robert Nestle from Inspire, did a great program on this. I saw him do a speech on this and how he got this major company. I mean, I’m going to going to mention the company, but it’s big. He got them to stop funding the Gay Pride Parade. Because of that, and they said we didn’t realize that was happening. They pulled back the finance for that. That is a good thing. We have a voice, and if enough Christians will come together through the BRI movement.
Shawn:
I’d like to say one thing on that, Bob. There is a big difference between giving money to support Gay Pride Parade and being on board with treating people with respect especially as a Christian. If someone is part of the LGBT community, do not treat them poorly, do not discriminate against them. For one, that is absolutely against what Jesus told us to do. We’re to go and make disciples of all men.
Bob:
All are welcome in the church.
Shawn:
What did Jesus say? They will know you by your love for one another. There’s a big difference between loving those people and wanting to be available to help them and want them to come to know Christ. That is not the same as, oh, I want to take money, or I want to invest in a company that is taking money off the profits and paying to promote that very thing. Those are two very different things. I just want to make sure people don’t get that confused. They’re not the same. That’s all.
Bob:
If the company makes widgets, they need to be in the business of making widgets. Not supporting agendas that violate biblical principles.
Shawn:
If I had a choice, I would say, you know what, if no companies were very Christian leaning, but they just remain neutral. They just didn’t get involved in either way, that’s fine. Just let the individuals, let those individuals make the choice of what they want to vote for and support. Just stay out of it.
Bob:
Well, I hope this three part series has been very informative to you on Biblically Responsible Investing. If you did not hear part one and part two, I really emphasize that you go back and you watch those or listen to those. We hope that through this faith-based investing, we’ve touched your heart. If you would like to align your Christian faith with how you invest, then we are here to help you do that. You can find out more by giving us a call at (830) 609-6986 or texting that number as well during regular business hours, Central Standard Time. Or you can find out more by going to our website to christianfinancialadvisors.com. Remember, this is the last thing I want to say. Being biblically responsible in your investments is pro-life,
Shawn:
pro-family, and pro-God.
Bob:
It gives light to darkness.
Shawn:
Thank you for joining us and hope you join us next time. God bless.
[DISCLOSURES]
Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors, also known as Christian Financial Advisors, a registered investment advisor. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host, Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 144 – Biblically Responsible Investing Part 2Biblically Responsible Investing Part 2Learn more about screening technologies within BRI.
More episodes >>
We are on to Part 2 of our three part series on Biblically Responsible Investing (BRI) where we discuss screening technologies. BRI is a subset of Values Based Investing that caters to Christian and Biblical beliefs in an investment portfolio. It allows Christians, or whoever is interested, to invest in companies that do not go against Biblical values. It is also known as Faith Based Investing.
So, how is such a unique way of investing completed? Bob and Shawn go over just how a BRI investment portfolio is created through using modern screening technologies. However, this is just the tip of the iceberg when it comes to creating a well diversified BRI (or Faith Based Investment) portfolio.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PeterseVALUEatorWebsiteInspire InsightWebsiteBible Verses In This EpisodePROVERBS 13:11Dishonest money dwindles away, but he who gathers money little by little makes it grow.
PROVERBS 15:1The house of the righteous contains great treasure, but the income of the wicked brings trouble.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTIntro:
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with a biblical Worldview. Here’s your Christian Financial advisor’s host, Bob Barber and his co-host, Shawn Peters.
Shawn:
Welcome to another episode of Christian Financial Perspectives. We’re so glad that you decided to join us today. If you’re on YouTube watching this, I would ask that you please subscribe to this channel, especially if you like content that is on finance and from a Christian perspective.
Bob:
If you’re a podcast listener, you’re going to want to go watch the YouTube because we’re going to have these reports that we’re going to show.
Shawn:
If you are listening to this episode you’re welcome to still listen to it on our podcast directories, but it probably would be a little bit better of an episode visually. What we’re going to do real quick is I’m going to go over a recap. This is a part two of our Biblically Responsible Investing series, and is a recap from part one, for those of you who did not get a chance to watch or listen to that. Last time we covered the definition of Biblically Responsible Investing, which is a type of Christian values-based investing that seeks to align in investors holdings with biblical principles. Another term for that could be faith-driven investing. It is aligning your investments with companies that support Christian and Biblical teachings while avoiding companies that do not. BRI is pro-life, pro-family, and pro God.
It gives light to darkness. Then we also covered the history of Biblically Responsible Investing or BRI, and we covered how BRI is not ESG. Finally we covered the many BRI investment choices today. There are over 34 BRI ETFs and mutual funds to choose from, plus hundreds of stocks and bonds. Again, BRI is Biblically Responsible Investing, so we don’t get lost in the acronyms. I would definitely encourage you to go back and review part one if you did not watch or hear it yet. Onto you, Bob.
Bob:
Today we’re going to cover the positive screens for Biblically Responsible Investing, or like we say BRI, the negative screens for BRI, and the technologies we use to screen for Biblically Responsible Investing with actual example. The positives are we seek out above average best what we call in-class companies in the following areas: Number one, we look at their business model. That’s their business products, their services, and operations. How they’re structured in a way that benefits rather than exploits their customers.
Shawn:
Number two, we have product integrity and innovation. Creates the company, creates products and services which are helpful, and create value rather than extract value or harm users.
Bob:
Next we look at how the company is run at their corporate governance like policies and behaviors regarding executive compensation, ethical dealings, board management, etc.
Shawn:
Number four is human capital. This is related to policies and behaviors regarding equitable employee management.
Bob:
Then their social impact, the impact and influence on society as a company and communities in which the company operates.
Shawn:
Number six, supply chain impact, influence on society and communities in which the company operates. kind of similar to the social.
Bob:
Number seven, and we believe this strongly in the environment, if you love God’s creation, you want to take care of the creation. I mean, if you love the creator, you want to take care of the creation. This measures the company’s impact on the environment, including air, water, and land.
Shawn:
Then the final one on the positives is sustainable energy use and production. Measures the company’s use and production of sustainable energy.
Bob:
The negatives, and this is really how Biblically Responsible Investing started out. In beginning it just looked at the negatives. Now we look at the positives too, so that’s why we covered the positives first.
Shawn:
Now we look at the negatives.
Bob:
The negatives, if the company is involved in exposure to any of these areas, we strive to stay away from investing in that company. Number one is pornography. The manufacture, sale, or distribution of pornography/ pornographic content. You will be very surprised to find many of your large Fortune 500 companies are involved in this.
Shawn:
Number two, alcohol manufacturer or sale of alcoholic beverages.
Bob:
Number three, if they produce tobacco in any way, manufacturer, or sell tobacco products.
Shawn:
Gambling, whether the ownership or operation of gambling facilities, either physical or internet based.
Bob:
As an example, we’re not going to own any hotels in Vegas. Number five is bioethics. Involvement in the business or promotion of abortion, including… I never can say that one good.
Shawn:
I think it’s abortifacient.
Bob:
Abortion drugs. Embryonic stem cell research or philanthropy. If they’re giving any money to Planned Parenthood.
Shawn:
Number six is human rights. Known human rights violations such as employing children, slave labor, human trafficking, discrimination, and things like that.
Bob:
That has a lot to do with your international companies. Not here. Number seven, the LGBTQIA+ 27 other genders activism. Corporations that use shareholder dollars to push a social agenda such as this alienating their customers investors with alternative viewpoints. We really believe there’s some good scriptural principles. We’re going to share a lot of that in part three, but 2 Corinthians 6:17 tells us to, “Come out and be separate; touch no unclean thing and I will receive you.” This is very important when it comes to BRI, and why we feel this is a scriptural basis for that.
Shawn:
Then Exodus 20:13-14, “You shall not murder, you shall not commit adultery.”
Bob:
That comes under the screening of pro-life. We want to be pro-life and not invest in abortion clinics and adultery.
Shawn:
As well as the pornography.
Like Jesus said, if you even lust after a woman in your heart, you’ve committed adultery.
Bob:
Psalms 139:13 is another very pro-life scripture that we believe goes with investing. “For you created my inmost being you; knit me together in my mother’s womb.” Now we’re going to get to the technologies that we use with Biblically Responsible Investing.
Shawn:
Researching companies on the internet and then verifying them by using things like the evaluator online screening tool. Which is a paid program, and anyone can subscribe to that, but it is a little more expensive. Then there’s also the Inspire Insight tool, which is actually has a free version. You can do a lot of screenings. I’m not sure if there’s actually a limit on the screenings. They’re paid version gives you a little more access to some extra tools, but those are two really great examples. They’re both very stringent on their own.
Bob:
The evaluator is what I call the original. This is what I was using back in like the nineties when I started this. The evaluator really looks at the negative screens, like it says, “come out and be separate, touch no unclean thing.” Then Inspire came along a couple years ago and they’re using Biola University to help them with this. They look for the positive screens as well. We like that because we want to invest in the positive while avoiding the the negative. Let’s look at some of these examples. We’re going to pull this up on the screen.
Shawn:
The first one we’ve got Bob, Vanguard 500 index is very common. Just as a quick cover our bases for compliance purposes. The holdings and funds that we’re going to be showing on screen, none of these are an actual recommendation to purchase. It’s not…
Bob:
to buy our sell.
Shawn:
You need to do your own research or work with your own advisor. This first one, Vanguard 500, Bob, I’ll kind of go through this if you want to just break this down a little bit further.
Bob:
I will because I’ve been using this report for years and years, so you want me to do that?
Shawn:
Yeah, go ahead. I’ll just kind of scroll through for you.
Bob:
What this is saying is when you invest in that Vanguard 500 index fund, it has 48% of the companies in that fund are involved in the abortion industry in some way, form, or fashion. Either giving to the Planned Parenthood or involved in the embryonic stem cell research. Just things like that. Then you look down and you see alcohol, entertainment, gambling, and lifestyle. This shows how 65% of the companies in the S&P 500 index fund and this Vanguard 500 index fund are involved into LGBTQIA+. Like I say 27 other genders. That’s the latest I’ve heard. I don’t know how many genders there are. Makes it easy?
Shawn:
Yeah, I know.
Bob:
Man or wife.
Shawn:
I just say LGBT+ because I can’t keep track of all the acronyms.
Bob:
Then we got pornography. People were real surprised when they see, like, you’ll see down here where it says, you’ll see Apple, or you’ll see like Microsoft. You’re like, how are they involved in pornography? It has to do with the distribution of it over their networks. That’s what we mean by that.
Shawn:
It could be an example of one that in their, say Apple TV or something.
Bob:
Netflix is another example.
Shawn:
Netflix, things like that.
Bob:
Then we have the human rights campaign. This is something that came about later, Shawn. With the international we started looking at that and going, well, this is human slavery. You’re violating human rights.
Shawn:
Not only that, but you have companies who have operations, or manufacturing, or things like that in other countries. me of this would be US companies with overseas operations. They’re following the law of the country over there, even though it wouldn’t pass merit here in the United States.
Bob:
You can see on the screen here, you can see these top companies that we have here, and you’re like, “Wow, I didn’t know that.” Those are well known companies I recognize. There are still a lot of great companies to invest in, so don’t just think about the negative. There’s a still a lot of positive great companies to invest in.
Shawn:
Keep in mind too, whenever you see an evaluated report, the this is the top violating companies. These are not all of the companies within this particular holding. It only shows, I think it’s like top 15 or something like that.
Bob:
Let’s show a positive fund. We pulled up the Timothy Plan high dividend ETF. You notice no violations. If they do find one violation, they will sell that holding almost immediately, Shawn. I mean not almost, they will. The day that they find that out, they’ll turn around, or a lot of times they’ll give the company a chance to stop doing that.
Shawn:
Especially if have a larger exposure to it, because sometimes, and that’s kinda the other part of Biblically Responsible Investing.
Bob:
We’re going to talk about that next week.
Shawn:
The idea of shareholders using their voting rights to try to affect change within a company. If they’ve got that one violation, and especially if it was a more recent change, well yeah, we’ll get into that next week. Sorry.
Bob:
Then we wanted to show the Inspire, so we pop over to another website. The Inspire example of the Vanguard 500, they give us positive or a negative score so you’re looking for a positive score. Something like a plus 10 or a plus five.
Shawn:
Here you can see under environmental, they scored very well, very high on that. It kind of breaks it down into the different areas within environmental. Then if you want to, it’s kind of cool, you can click on some of these links here, and you can see which companies are actually involved within that holding for that. Then on the negative side, you’ve got, okay, what does this mean by social? Well, it’s broken down into LGBT+ philanthropy, legislation support, abortion promotion, LGBT promotion, and pornography. Then you’ve got the abortion drugs and stem cell research. It just kind of breaks all that down.
Bob:
It’s a fantastic program. Then we had the Inspire positive. Let’s look at a positive stock because we talked about some negatives. This is not a recommendation to buy or sell stock.
Shawn:
In this case, Vanguard had a negative 31. Anything that’s a negative number just means overall, hey, probably something you want to avoid from a Biblically Responsible Investing standpoint. Then if you have a company that’s got a positive score for their overall inspire impact, that’s a good potential option. In this case, they didn’t have any negative screenings that came up. They had multiple areas; environmental, social, and governance that came up as positives, positive screens.
Bob:
That was a 60, which is a very, very high score.
Shawn:
Here’s what it looks like on the Evaluator, or what they call their investigate, or investigation side. Again, you’ll see here, hey look…
Bob:
Zero violations.
Shawn:
They didn’t have any violations, so that’s good.
Bob:
Now the company just has to pass what we call, “pass the muster”. They have to pass for their financials. They got to look good financially. That’s why we’re not saying we would buy or sell this company. Once it’s made it through this process for BRI, then we can look at the company, is this a good company to buy or not?
Shawn:
Now it now has to pass the actual financials.
Bob:
All right, that’s going to do it for today as far as part two and how we use technology. Next week we’re going to cover why Biblically Responsible Investing is so extremely important, especially to a Christian. What’s the scriptural basis for being biblically responsible, and how BRI makes a difference in the marketplace. In learning about BRI, if this is stirring your heart, and you’d like to align your Christian faith and your biblical worldview with how you invest, then give us a call or text us at (830) 609-6986 during regular business hours. Or find out more by going to christianfinancialadvisors.com. That’s all for today.
Shawn:
You don’t want to miss part three which should be coming out next week, and we look forward to seeing you then. God bless.
Outro:
We invite you to listen to all of our past episodes, covering many financial topics from a Christian perspective. To make sure you don’t miss any of Bob’s upcoming episodes. You can subscribe to Christian Financial Perspectives on iTunes, Google Podcasts, Spotify, Stitcher, or Amazon Music to learn more about integrating your faith with your finances. Visit Christianfinancialadvisors.com or call (830) 609-6986. Investment advisory services offered through Christian Investment Advisors, Inc DBA Christian Financial Advisors also known as Christian Financial Advisors Management Group, a registered investment advisor. Comments from today’s show for informational purposes only, and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 143 – Biblically Responsible Investing Part 1Biblically Responsible Investing Part 1Check out part 1 of 3 of our series on Biblically Responsible Investing.
More episodes >>
In Part 1 of 3 about Biblically Responsible Investing, Bob and Shawn delve into what exactly Biblically Responsible Investing – BRI – encompasses, how it works, and some of the companies that Christian Financial Advisors works with. What exactly is BRI? Well, Biblically Responsible Investing (BRI) falls under the realm of types of Values Based Investing. BRI is the short term phrase for it, and it is something that is the core of Christian Financial Advisors and our investing methodology.
BRI is a great choice of investing for Christian investors, or even regular investors, who want their financial portfolio, mutual funds, and ETFs involved with companies that are supporting the good and filtering out the bad. Learn about how it got started and what makes it different from other values based investing choices.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersTimothy PlanWebsiteEventideWebsiteInspireWebsiteBible Verses In This EpisodePROVERBS 13:11Dishonest money dwindles away, but he who gathers money little by little makes it grow.
PROVERBS 15:1The house of the righteous contains great treasure, but the income of the wicked brings trouble.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTIntro:
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with the biblical worldview. Here’s your Christian Financial Advisor’s host, Bob Barber and his co-host, Shawn Peters.
Shawn:
Welcome to another episode of Christian Financial Perspectives. We’re so glad you joined us. If you like this type of content where we talk about financial topics, but from a Christian perspective using biblical principles, please make sure you hit that subscribe button and like this video. Today, we are going to be covering part one of three, of something called Biblically Responsible Investing, or BRI. This is something that is very important to us here at Christian Financial Advisors, and Bob has been around since the ye olden days of this, right Bob?
Bob:
I was young when I started doing this kind of like you are Shawn. Now you’re growing this nice beard I see going on here.
Shawn:
Well, unlike you, Bob…
Bob:
That is some gray in it though. It must be the grandkids doing that to you huh?
Shawn:
Well, my kids You’re your grandkids.
Bob:
Okay.
Shawn:
I have to, Bob. See, I don’t have any wisdom hair in the top of my head. I’ve only got it in my sideburns, so I got to look like I know what I’m talking about and have some wisdom.
Bob:
You can go get some gray color and put it up there. So we are going to talk about Biblically Responsible Investing. This is so important. We’re going to do this over a three-part series, or else you’d be here with us for the next hour. We’re going to cut this down into 12, 15 minute segments, and first, we wanna talk about what the definition of Biblically Responsible Investing is. Shawn’s going to let you know what that is.
Shawn:
Biblically Responsible Investing, or BRI for short, is the type of values-based investing that seeks to align in investor’s holdings with biblical principles. Another term for this could be faith-driven investing or faith-based investing. I know those are two terms that, more and more people are looking for.
Bob:
We’ve called it so many different things over the years. It started off with Morally Responsible Investing. Then it was changed to Biblically Responsible Investing, and you hear it referred to as faith-based investing now.
Shawn:
It’s really all the same though. It comes back to the purpose of what we’re talking about here which is aligning an investor’s holdings with biblical principles as a Christian.
Bob:
Exactly.
Shawn:
Another thing with this is that it’s aligning your investments with companies that support Christian and biblical teachings, principles, while avoiding companies that do not. It’s not just about negative screens. It’s negative and positive screens.
Bob:
In the beginning it was just about negative screens, but now it’s about positive screens as well, which is nice. I’m glad it’s evolved over the last 27 years. I’m one of the founders of the Biblically Responsible Investing movement, so I’ve seen this thing really change a lot.
Shawn:
I know when you first got started, it was you and three or four other people that even talked about it.
Bob:
There was basically five of us. I can still name those names. One of them, has already gone to be with the Lord. He got cancer, but we’re still around. We are very excited about what we have seen with Biblically Responsible Investing, and how it’s grown from this tiny, tiny movement into this gigantic movement now.
Shawn:
A lot of that too, I think is really cool with the way technology has changed over time. I think part of the reason really for it being mostly focused on avoiding these companies that are involved in these specific negative areas is that it was just a little easier to find the information on that. Whereas now with as screening technologies and accessibility to information has improved over time. Now you can look for companies that aren’t involved in certain contentious areas that don’t align with our beliefs as Christians, but you can also look for companies that are involved in doing positive things. It doesn’t all necessarily mean that it’s Christian. It’s just more of a someone is doing something that they’re not doing it because they’re a Christian or because they’re a Christian company, but they just think it’s a good thing to do and we can align with that as a Christian.
Bob:
You can align with, even though you may not be even a Christian, you can align still with biblical principles of morality. That’s what we mean by that.
Shawn:
We have two scriptures. I’m going to cover those.
Bob:
Absolutely. This is a very scripturally based type of investing, so it needs to be in there.
Shawn:
Bob, hopefully, what we can do is have you cover a little bit of the history of why the BRI movement started.
Bob:
I can. I sure can.
Shawn:
Proverbs 13:11, “Dishonest money dwindles away, but he who gathers money little by little makes it grow.” We also have Proverbs 15:1, “The house of the righteous contains great treasure, but the income of the wicked brings the trouble.”
Bob:
Some of the scriptures we always use too, is Psalms 24:1, “The Earth is the Lord’s, and everything in it.” If you believe that God owns it all, then Biblically Responsible Investing is for you. The history started many, many years ago. Like I said, it was about avoidance, and there was a major company back in the nineties that had special days for the LGBT. I remember the Southern Baptist Convention calling for avoiding, supporting that entertainment part. You notice I’m not mentioning names, trying not to. That is what, how this started, and then we started looking at, there’s a lot of companies that were supporting Planned Parenthood. That was like the abortion industry or using fetal tissue research from abortions, or pharmaceuticals. That’s the history and where it’s evolved into today.
Shawn:
Future Shawn here. Just had to add a quick insert for this episode. Just to clarify something that Bob and I are about to talk about in the video. The SEC has decided to use the term ESG as a generic name to categorize all types of Values-Based Investing, which means they consider Biblically Responsible Investing to be a type of ESG. When we reference ESG in the rest of this episode, we are referring to the specific, decades-old type of investing that screens for Environmental, Social, and Governance values, and NOT the generic term the SEC has decided to use in the investment industry to describe different types of Values-Based Investing. And now, back to the video.
Shawn:
Really the concept, I would kind of step back for a second and say Biblically Responsible Investing, faith-based investing, they’re really, and ESG, not saying they’re all the same, but they would all be considered a type of values-based investing. Where you’re not just looking at the financials, but you’re investing based on what a company is or isn’t involved in. Obviously we’re going to get into the differences between this and ESG. Over the last, I’d say really the last 10 years or so, it seems like the idea of investing based on the financials and based on does this company align with you as an investor.
Bob:
As a Christian and my values.
Shawn:
For us as a Christian, it is important because at the end of the day, we will be held accountable to the Lord for how we acted during this life. We know how we handled the things that were given to us to take responsibility of, so that ownership is important.
Bob:
Like you say, BRI or Biblically Responsible Investing, faith-based investing
Shawn:
Is not ESG.
Bob:
Is not ESG. What does ESG mean?
Shawn:
ESG is the, environmental… you put me on the spot. It’s the Environmental, Social, and Governance. Sometimes they get those mixed up.
Bob:
It’s not that, it’s actually as opposite as you can get from that.
Shawn:
For the most part. For the most part. I would say calling what a BRI investor does, ESG, is somewhat insulting. As for many years, the ESG methodology has been mostly kind of the opposite of what Christian investors seek out. BRI screens out companies that are involved in supporting abortion and the LGBT agendas.
Bob:
Also gambling, alcohol, and tobacco. We look at slavery, human slavery, and other countries. Are they using child labor? Those are the screens that we say, if that company’s involved in that, we’re not going to buy that company.
Shawn:
Whereas on the flip side, ESG has typically been associated with, if a company is involved in heavily supporting these different types of lifestyle choices with the abortion and LGBT, that they are even celebrating those. Not to mention they want invest in them. That to me is a big difference between BRI and ESG. Now, Bob, we have to kind of cover the beginning, so what options really were there 27, almost 30 years ago? What options did you have when you first started doing this?
Bob:
One to two, maybe three, or you could do individual stocks.
Shawn:
You had to do your own research too. A lot of your painstaking research.
Bob:
The programming way, way back, was just starting off, and I remember Scott Fehrenbacher, the founder of that. Then Timothy Plan bought this program called the Evaluator. Now you can go online and you can look at the evaluator, and anybody can subscribe to it. Take away individual stocks. There were very, very few choices. Just one or two, or even three was the max if you wanted to buy a mutual fund or ETF, that was biblically responsible.
Shawn:
What about today?
Bob:
Oh my goodness that’s changed. Today, the Timothy Plan mutual funds that were, Art Alley, is the father of Biblically Responsible Investing in this country. Now there’s 12 mutual funds that they offer plus six ETF’s so that’s 18 choices .
Shawn:
Just from that one fund family.
Bob:
Then, Eventide Funds started behind that, and they offer eight different biblically responsible mutual funds. Now you add that together, you’re getting up there in number. Then a few years back, my good friend Robert Nestle, I remember bringing him here to our headquarters and talking to him and educating him about BRI. He found me on online from research. He said, “I want to go see Bob,” and he took the torch and ran with it.
Shawn:
He got a little bit of that itch for like, I really wanna do more with this.
Bob:
I’m so proud of him because he’s the youngest of all of us in the BRI movement. They have eight ETF’s at inspire where he started. When you add just those three investment managers together, there’s 34 different choices now, of biblically responsible ETF’s and mutual funds. 34 choices! I mean, how many choices do you need? Then we put together our portfolios and overweight or underweight these portfolios depending on that.
Shawn:
Keep in mind, that’s just the fun choices. Obviously if you use Inspire, the ETF’s that you were talking about Robert Nestle. Inspire insight is a tool that someone can use actually for free. They do have a paid subscription, but they do have a free one.
Bob:
For monitoring funds and stocks.
Shawn:
If you just wanted to see for some of your own stock picking, if that was something you wanted to do, you do have options now to screen. Whereas 30 years ago, good luck. You’re going to have to go through all that data manually. So that’s really exciting, but keep in mind, one other thing we want to hit highlight is that, do your research. Not all companies that say that they are biblically responsible, that they do BRI are. A couple of examples that, and I’m sorry if somebody gets mad. I’m stepping on some toes here, but Thrivent and Guidestone are not biblically responsible.
Bob:
Not according to our screens.
Shawn:
Not according to our screens and from the information that they’ve shared and posted themselves. One of them that really frustrated me, because we had somebody that came to us and they were evaluating our firm versus some other firms. I did a little research because I hadn’t even heard that Thrivent was even offering faith-based funds.
Bob:
Well, Thrivent came from the Lutheran.
Shawn:
Yes, but here’s what got me. When, you start looking at the disclosures, if you will, the disclaimers of their faith-based funds, it very clearly says that they don’t do any kind of verification. That their funds are actually following the screens that right above that they just said that they’re screening out for. Then on top of that, like with guidestone who fails the screens that we do. Guidestone is one of multiple fund families that they include within their faith-based portfolio. If you’re not doing anything to actually screen or verify, or use companies that pass those screens. How can you call yourself biblically responsible? I mean, otherwise what you’re doing is you’re saying we’re faith-based because we want Christians to invest with us, but you didn’t actually do anything different. That misses the entire point of Biblically Responsible Investing. It should look different than the rest of the world.
Bob:
So that’s going to do it for today. This is just the first part series on Biblically Responsible Investing. We’re going to do a three part series. Next week we’ll get into part two. That’s going to go deeper, and then part three will sum it all up.
Shawn:
That’s right. Thank you for joining us and God bless.
Outro:
We invite you to listen to all of our past episodes, covering many financial topics from a Christian perspective. To make sure you don’t miss any of Bob’s upcoming episodes. You can subscribe to Christian Financial Perspectives on iTunes, Google Podcasts, Spotify, Stitcher, or Amazon Music to learn more about integrating your faith with your finances. Visit Christianfinancialadvisors.com or call (830) 609-6986.
Disclosure:
Investment advisory services offered through Christian Investment Advisors, Inc DBA Christian Financial Advisors also known as Christian Financial Advisors Management Group, a registered investment advisor. Comments from today’s show for informational purposes only, and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 142 – Budgeting Without NumbersBudgeting Without NumbersLearn how to create the right mindset when it comes to budgeting.
More episodes >>
Budgeting is a topic that commonly arises, and it is hard for most people to commit to it as budgeting can feel like bondage, not freedom. However, it is the lack of debt and ability to stick to a budget that brings so many of us financial freedom. Nobody likes debt or wants to be in debt. Even if you have the financial ability to buy anything you want, it isn’t always beneficial to you.
There are many ways that you can save on money (and/or decrease your purchases) that don’t have to directly deal with numbers. It just means having the right mindset. Some of the areas that Bob and Shawn cover include waiting before large purchases and methods to keep your emotions at bay when considering purchases.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersSimplifying The Money ConversationMint By IntuitWebsiteSimplifi By QuickenMonarch MoneyWebsiteBible Verses In This EpisodePROVERBS 27:24For riches are not forever, Nor does a crown endure to all generations.
EXODUS 20:17No lusting after your neighbor’s house—or wife or servant or maid or ox or donkey.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTIntro:
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with a biblical worldview. Here’s your Christian Financial Advisors’ host, Bob Barber and his co-host, Shawn Peters.
Shawn:
Welcome to another episode of Christian Financial Perspectives. We’re so glad you joined us today. If you like content on budgeting, finance related of any kind from a Christian perspective, we’d love it if you would hit that subscribe button. Depending on when you’re watching this, we’re excited that we just hit our hundred-thousand subscribers.
Bob:
Did we really? Hey, I didn’t know that.
Shawn:
At some point, at some point, this will be true when someone’s watching.
Bob:
In the future. Okay. We would love you to subscribe as we grow and get the message out about how to handle money from a Godly perspective.
Shawn:
If you do help us to reach that goal of a hundred thousand, we’ll be really excited.
Bob:
We really thank you.
Shawn:
So Bob…
Bob:
Oh goodness, what a title.
Shawn:
Hopefully, some of you saw our title and it really isn’t clickbait. This really is going to be, “Budgeting Without Numbers,” because budgeting is far more than just numbers.
Bob:
That’s correct. Now there’s going to be a few numbers at the very end. About 80 to 90% of budgeting is not about numbers. You’re like, “How can you say that?”
Shawn:
Now, Bob, your other idea for this episode was to call this, “The Budgeting Mindset,” right?
Bob:
That’s correct.
Shawn:
So, before we get into that, let’s read a couple scriptures because this is Christian Financial Perspectives.
Bob:
These scriptures really do tie into what we’re going to be talking about, Shawn.
Shawn:
All right, well, let’s go with the first one. Proverbs 27:24, “For riches are not forever, nor does a crown endure to all generations.” You want to go with Exodus?
Bob:
I’ll go with Exodus. I took this from The Message. I thought it really was great. “No lusting after your neighbor’s house–or wife or servant or maid or ox or donkey.” Now most of us don’t have an ox or donkey today.
Shawn:
I guess you could replace that with the name of a car brand.
Bob:
Exactly, or his Lexus or boat. Don’t set your heart on anything that is your neighbors, and this is really the foundation for today, Shawn. This is about coveting. This is about wanting what others have, and I think that is a reason that so many people blow their budget.
Shawn:
It’s a long scripture, so we’re not going to read all of that one right now, but it makes me think of the parable of talents, too. Where the master was going to be going away for a while, and what I love about that scripture. I feel like sometimes you just kind of gloss over the beginning, but it wasn’t so much just that one he gave five, one he gave two, one he gave one. But that it specifically says that he gave each to their own ability.
Bob:
That’s true. People often will miss out on that.
Shawn:
Obviously what you can see from that is there were three servants. They were not all given the same number of talents, but it was according to their ability. What we’ve got to always remember, and this definitely ties into the mindset, is that budgeting is about managing what God has entrusted to you. Not worrying about what your neighbors doing, what it looks like they have. Which we’ll get into that too, and sometimes that might just be all a facade. Some people, and let’s just kinda make this clear since we’re talking about budgeting. Some people just flat out don’t make enough money for all of life’s needs.
Bob:
I’ve seen it, Shawn. You make less than $25,000 a year here in the United States, and that’s not enough money to pay all the bills. There’s just not enough there, and I’ve heard them, they’ve come to me before and said, “I need help with budgeting.” I’m like, bless your heart because there’s just really, there’s not any room for anything, for the majority.
Shawn:
For today’s episode, today’s episode is going to be for the majority of the people in the United States that do make enough. They’re not below the poverty line, and when it comes to budgeting, success is not based on the numbers, but on having the right mindset. If you don’t start with the right mindset, it doesn’t matter how creative you get with spreadsheets and budgeting apps or numbers, it’s not going to make a difference. You’ve got to have the right mindset or you are not going to succeed.
Bob:
You’re domed for failure because all the numbers don’t mean anything if you don’t have that right mindset.
Shawn:
I mean, I can come up with numbers all day, but we’ve seen it before, Bob. People ask us, “Hey, I’m trying to reach this goal for retirement.” We say, “Okay, great. We need to open up this kind of account, you need to be putting this much away every month between now and when you’ve estimated that you want to retire,” and it happens over and over. Some people follow the plan and some people don’t. Then when they get to retirement, “Why don’t I have enough money?” Well, I gave you the numbers, but if you can’t have the right mindset and be disciplined and follow the plan, it doesn’t matter what plans you come up with.
Bob:
I’m coming from this folks, people, I’m coming from this with 30, no, it’s coming on 34, 35 years of experience. I’ve seen this over and over. I’ve seen people, they really don’t have a budget, but they have the right mindset. They don’t find themselves in financial trouble because they have that right mindset. I see it every single day throughout the history of how long I’ve been in this business, this financial advisory business. I think it’s first that we got to lay down some foundation. What is your personality trait? Because everyone has a different personality trait. Well, there’s basically four main ones as we know. Are you a saver or are you a spender? Which do you enjoy most? Saving or spending? Now, believe it or not, I actually enjoy saving. I know I’m out there and I’m part of that small percentage, but I enjoy saving. I enjoy watching the value go up of my cash reserves. I feel security in that. My ultimate security is in Jesus Christ and God. It is very important to me to see that I have cash reserves, so that if something bad happens, I’m ready for it. Bad things have happened as life happens. I mean, when Rachael got cancer, life happened, it took me out of the workplace for a while. But we had our cash reserves set up, we had our insurances in place. Some people, they just love that spending. That’s not bad.
Shawn:
If you are the one that says, “Oh, I like to spend.” That doesn’t mean you can’t have the right mindset. It doesn’t mean you can’t be successful, but these personality traits that we’re covering, think of it as you need to know yourself. You need to know yourself so what you need to do in your own life. If you have a spouse, you and your spouse need to be able to hold each other accountable. I would say that between Jenna and I, my wife, she is probably more of the saver than I am, even though I’m a financial advisor.
Bob:
I think Jenna got her dad in her.
Shawn:
We are still, at the end of the day, we both lean more towards we want to focus on the saving first and the spending, that’s kind of a reward, if you will. That is not our focus. The focus is we make sure we handle the being more frugal, more conservative side of things. You got to ask yourself that first question. Are you a saver or a spender? Which one do you tend to enjoy more? Then the next one, does buying things make you happy? We know it doesn’t create joy, but for some people, the act of buying that thing or hitting buy now or add to cart or whatever it is. It does have a little bit of a dopamine hit, and it makes you happy.
Bob:
Without a doubt, what you just said, that dopamine hit.
Shawn:
Some people don’t really care. It doesn’t really matter to them.
Bob:
Well, I knew somebody that was in the family, they’re no longer around, but I mean they’ve gone home to be with the Lord. I could tell they got their significance from shopping. Now, they liked to shop for other people and they loved to buy things for other people. I could tell that gave them their significance and enjoyment.
Shawn:
So the next one, is long-term financial security important to you, or is having a temporary status symbol more important? Which one of those are more important? Again, not trying to get onto people.
Bob:
No, not at all.
Shawn:
But it’s just, again, try to be honest.
Bob:
These are personality traits.
Shawn:
Try to be honest and ask yourself, which one are you?
Bob:
How do you feel about cars? Is driving an old car that works well just fine, or are you always wanting that new one?
I mean, I know some folks that they trade out of cars like every year or two. I’m like, man, you are just getting hit with it, and the car is fine, but they want that new car. They like that new car smell I guess.
Shawn:
I would argue, getting a new car isn’t a bad thing. To be honest, when you’re buying a new car every year, you’re compounding how much money you’re losing, because you’re buying a depreciating asset. So there’s nothing wrong with buying it new, but you’re kind of leaving a lot on the table when you buy something new every year. For sure, every two years minimum. Anyway, ask yourself, “Which one are you?”
Bob:
I know which one, like we were saying, my own daughter, your wife. I don’t know, y’all had that little Subaru now for 7-8 years. I know y’all were going to buy a new one and you plan on keeping it for 10. You keep cars, y’all keep cars a long time.
Shawn:
Oh, we’re keeping the seven or eight year old Subaru, too. We’re actually trading in the newer vehicle.
Bob:
So you have more of a family vehicle. I’m with you.
Shawn:
So the last one is…
Bob:
Oh, isn’t this interesting? This is a good one.
Shawn:
Do you like numbers, or do you despise math?
Numbers, spreadsheets, whatever you want to call it.
Bob:
Here in the office, we’re all a bunch of numbers geeks. We all love spreadsheets and math.
Shawn:
Probably good considering that we work at a financial firm, right?
Bob:
It is. That’s definitely a personality trait I think that we have around here.
Shawn:
There’s good news, right, Bob? If for that last one, you despise math, the good news is that budgeting is mostly a mindset. It’s not based solely on the numbers, so there’s hope for you.
Bob:
So, we’re going to get into lots of different ways to get that mindset right when it comes to budgeting, so you don’t have to worry so much about the numbers. Because I will say this, Shawn, in knowing people, that it’s not a gift. Math is not their thing. I’ve seen a guilt feeling, they want to be able to like those numbers, but first let’s just get into the right mindset, then the numbers will come into play.
Shawn:
Exactly. So the right mindset, what is the right mindset? We’ve got a few statements, we’re going to cover what is the right mindset. Bob, you want to get the first one?
Bob:
Hopefully, you can take this in and you can say, okay. If I can get that mindset, the budget’s automatically going to kinda line up under that. We’re going to share a little bit about numbers, but it really, it’s only going to be about 5% of today’s program, at the very end. The right mindset, first of all, it’s not comparing yourself to anyone else. Not the super rich, Hollywood, or social media. If you start comparing yourself to that, you’re never going to measure up. And advertisements, it’s geared that way, right? You always need better. You always need more.
Shawn:
Well, and there’s so much in social media, too, that is engineered to create a certain kind of image and brand, if you will. Very rarely is it based on real life. It’s not candid. The next one kind of ties into that. The right mindset is not comparing yourself to what other people have. Just like the parable of the talents, each given according to their own ability. Don’t compare yourself to other people. Learn to be content with what you have in all circumstances, just like Paul said. Be content in all situations.
Bob:
We’re coming out with this in the beginning of the year. It reminds me of Christmas time. I was telling you about the Christmas lights, and we get our neighbors. We live in this nice neighborhood, and the neighbors start competing with each other so much for Christmas lights, that they start hiring it out. I’m hearing numbers of $6,000 to $15,000. Now, that right there is the wrong mindset.
Shawn:
Also, your neighborhood has much larger lots, and it’s gated. I mean, there’s not a lot of traffic. In my opinion, it’s not, how dare you spend money on putting Christmas lights up. Sometimes, it’s not safe to get up on the roof, but still, when you’re spending so much money, who’s even going to see it? I mean, I guess it’s great for you and Rachael. They’re like, hey, everybody else is competing. We just have a nice view when we drive in.
Bob:
We’re talking about that guy across the street. He’s got 36 acres, and he decorates about half of it. It’s crazy and nobody sees it but the three of us that live down there on the cul-de-sac.
Shawn:
Maybe he’s making up, if that was one acre lots he’s making up for all the lights that would have been there.
Bob:
He pretty much is. I think this is another mindset that you want to understand, is that those people with the expensive cars and the big homes, many of them are leveraged to the hilt with high debt. It’s not from financial success.
Shawn:
That’s right.
Bob:
It’s all a, what do we call it?
Shawn:
It’s all a facade.
Bob:
It’s all a facade.
Shawn:
Remember that God’s word says, “The borrower is a slave to the lender,” and this does not bring peace. That one is, the right mindset is knowing that many people with expensive cars or homes are leveraged with a whole lot of debt.
Bob:
A lot.
Shawn:
It that does not, just because you see something nice, that does not mean that someone is financially successful.
Bob:
I’ll tell you, Shawn, here we are in 2023, and we know the economy is teetering. With the high interest rates and things and all the leverage, it’s scary. If you don’t have all the leverage level and the interest rates are going up, so what? I mean you’re fine.
Shawn:
So the next one, the right mindset is asking if what you already have is fine before making a large purchase such as a new car, larger home, or a major remodel.
Bob:
I tell you what, you watch HGTV all day long, and you’re going to think I need to remodel my kitchen every three years. Your appliances are working fine, your dishwasher’s working fine, your oven’s working fine, but HGTV convinces you. No, the countertops need to be all white this year.
Shawn:
You need to get the new appliances because they came out with the new matte black, and you have the shiny black. Now you need the matte black.
Bob:
A couple years ago it was stainless steel, right?
Shawn:
Now, they have black stainless steel. Oh, you only have stainless steel? You don’t have black stainless steel yet?
Bob:
You haven’t gotten with it.
Shawn:
Yeah, come on.
Bob:
That’s true, isn’t it? If you watch that stuff all day long, you get into that mindset. Hey, we need to remodel our home. What’s it going to cost to remodel your kitchen? $15,000, $20,000, $25,000? Is it functional right now? Is it working fine?
Shawn:
Depends on how big the kitchen is, I guess.
Bob:
That’s the mindset. You’ve got to be careful of that mindset because the world is always doing that, not Christian mindset, but the worldly, the secular mindset’s trying to do that to you.
Shawn:
The next one, the right mindset is asking if something is a want or is it a real need before buying anything?
Bob:
I think that’s number one, isn’t it? Wouldn’t that be number one? Is it a want or is it a need? Then when it comes down to buying that, we’re going to go over something else here in a minute that is it the right mindset. It’s being content with what you have and not always thinking the grass is going to be greener on the other side.
Shawn:
That’s right. If you haven’t noticed already, there’s a little bit of a trend in what we’re saying. Which a lot of this comes back to that mindset of being content with what you have.
Bob:
Yes.
Shawn:
If you approach your budgeting from that perspective, the numbers are typically going to fall.
Bob:
They’re going to fall right under it. If you don’t approach your budgeting like this, you’ve got it flipped. The foundation has to be built on the right mindset.
Shawn:
It’s kind of like our federal government as a whole. If they were just content with the tax money that they were bringing in and figured out a way to use that instead of, oh, we want to do more, we’ll just borrow it. We’ll produce it from thin air, and pass it down to the next few generations. They’ll figure it out.
Bob:
I like this next one, too. You know what? Your self-worth is not tied to all that material.
Shawn:
That’s right. We say it like this, the right mindset is knowing your net worth is not equal to your self-worth and that happiness is not based on material things.
Bob:
That’s right. Boy, hopefully hearing this just releases you from all this bondage that our world wants to put on you, because materialism is not going to bring true joy and long term happiness. It’s going to bring temporary, short term, but not long term.
Shawn:
The next one. The right mindset is defining limits for large and small purchases.
Bob:
I think that’s so important, isn’t it?
Shawn:
Now, this isn’t for everybody. I know for Jenna and I, we have a certain dollar amount. If it’s a purchase that is anything equal to or greater than a certain dollar amount, we have to at least discuss it.
Bob:
I think that’s great.
Shawn:
It doesn’t need to be thousands of dollars. It’s smaller than that for us, but it’s just good because, if you have your partner and you hold each other accountable, sometimes you might get a little bit excited about it. Then your spouse says, “Yeah, that’s a want. That’s definitely not a need,” and we have other stuff we need this month.
Bob:
For us guys, all right, the large purchase is a boat. The large purchase is a deer lease. That costs a lot of money. By the way, I remember one day pastor Ray, where I go to church here in town, he had a video during deer season and it was so funny because he got up and said, “Now honey, you need to really like this meat because…” and he started adding up with the deer lease cost and the gas to get to it. He said, “You realize we’re paying like, $35 a pound for this meat?” by the time they were done.
Shawn:
Which also to me would say, well, maybe you should hunt a little bit less and go to the grocery store where there’s $5 or $6.
Bob:
But there’s the joy of hunting, I guess. All right. What’s the next one, Shawn?
Shawn:
Number nine. The right mindset is understanding that debt works against you, not for you. I would say that’s even true if someone has real investment property. Whatever it is, if you’ve used debt for something, that debt is always working against you.
Bob:
Yes.
Shawn:
So in the case of even like an investment property, it doesn’t mean you can’t be successful with it, but you have to remember that no matter what happens, even if you’re not renting that property out, that debt is still working against you.
Bob:
Those lenders, though, they want to get you as high in that debt as possible because then you become slave to the lender. They are not fiduciaries in any sense of the word at all, because is that in your best interest to put you in a lot of debt? It’s in their best interest because what do they do when they put you in a lot of debt? They make a lot of interest off of you. That’s how they make a living is by making interest off of you.
Shawn:
That’s right. So the next one, the right mindset is not allowing emotions to make any buying decisions.
Bob:
That’s a big one.
Shawn:
Which kind of goes right into our next one, too.
Bob:
It is.
Shawn:
The right mindset is waiting on unnecessary small purchases for a couple weeks and big ones for at least three to four months. Everyone probably should have experienced at this point if you are an adult. There is definitely an emotional aspect to purchases.
Bob:
Oh, no doubt.
Shawn:
There’s the new car, the new home. There’s the, I’m buying some gadget for the kitchen. It doesn’t always have to be something huge, but there’s that emotional, like you get excited about it. Which again is okay, but waiting a little bit to make sure, okay. Was this just like an impulse? Online shopping in general has just made it so much easier to purchase. Don’t let those emotions dictate your buying decisions. A great way to do that is to give yourself a little bit of padding to say, okay, I’m not going to purchase. Unless it’s an actual necessity like we ran outta toilet paper. Necessity. If it’s not a necessity, wait a little bit of time. See if those emotions fade and you go, oh, well, I guess we don’t really need it.
Bob:
Well, we’ve talked about this in investing many times right here on a Christian Financial Perspectives that emotions and finance mix like oil and water. They should not be put together, ever. That’s so hard because we’re emotional creatures, and the emotions can take over the logic. For somebody like us who us who is very mathematically minded, that math is logic. Left brain is logic. Right brain is emotion. We’ve got to, in this case, for budgeting for you to get the right mindset, you’ve got to realize I cannot allow my emotions to dictate my financial decisions.
Shawn:
To piggyback off of that, Bob, think of it as driving. You don’t want to drive drunk. You don’t want to drive where you’re extremely tired. You don’t want to drive when you’re already really irritable or mad. Just like with budgeting, you don’t want to do these things when you’re frustrated, when you’ve had a lot of anxiety, when you’re stressed from work, or your kid slapped a kid in the face at school. Whatever it is that happened, hypothetically.
Bob:
So the best time to talk with your spouse about budgeting is not when the kids are yelling.
Shawn:
Exactly. If your spouse is not a morning person, do not try to talk to them about it first thing in the morning. Let them have their coffee first or their tea.
Bob:
I’ve learned my lesson there, folks. He’s speaking to me. I don’t know if he knows. You do the same thing? Don’t do that. Make sure it’s the right time of the day and the right time of the hour or all the stars are lined up.
Shawn:
Otherwise you’re making what can already be difficult, you’re making it more difficult, because the right mindset requires your emotions to also be in check.
Bob:
So let’s get into some budgeting wisdom. We have really gone into the right mindset. Like I say, that’s the foundation. There’s some budgeting wisdom here that we’ve talked about on the program for many years. This comes from, what we’re about to mention, comes from Ron Blue from Kingdom Advisors. He’s written a whole workbook on this, and we gave out a lot of them. Shawn, I’m going to let you do that.
Shawn:
Bob, do you remember what that book is called?
Bob:
It’s actually… oh gosh. We have them right here in our library.
Shawn:
We’ll put a link in the description.
Bob:
Remember that? We’ll, let’s do that.
Shawn:
There are only four ways. There are only four ways to spend money. Those four ways should be in the following order for handling money. Number one is LIVE or necessities.
Bob:
Right.
Shawn:
Number two is GIVE or charities. Number three is owe, like O-W-E, or debt and taxes.
Bob:
We’re always going to owe taxes.
Shawn:
Yep. Death and taxes. Number four, GROW, which would be saving and investing. With that in mind, consider cash reserves or your savings. Consider your cash reserves should be a safety net for unexpected expenditures. I think Dave Ramsey, for example, talks about the emergency fund. We always tell people you should have about six months of your expenses saved up. Whatever those expenses are, it varies by household. That cash reserve is for when an emergency happens, something unexpected, like the car breaks down. You got to fix it or else you can’t drive or there’s a health issue that comes up, like you talked about when Rachael got diagnosed with cancer. That was unexpected. Not really part of the plan. Your cash reserve, however, is not a little piggy bank or cash in the bank account to be spent on just anything. It is called the emergency fund because —
Bob:
For a reason.
Shawn:
For a reason, because it should be in emergencies. Not, “Oh, I really want the newest copy of this book,” they’re wanting to read, or I really want to go to the movies this weekend.
Bob:
Shawn, when I heard this for the first time by Ron Blue probably 10 years ago, it really struck me because it was that simple. It’s only four things and you can remember it, and they really just kind of flow. Live, Give, Owe, Grow. That’s all you’ve got to remember. Just put that in your mind. Live, Give, Owe, Grow.
Shawn:
Those are the only four things.
Bob:
Let’s put our little pie chart up that shows it, and that pie, the pie’s only this big. Whatever you spend on “live, give, owe, or grow,” something’s got to give if you spend more in another category. If you’re going to live on more, it’s going to affect your giving and growing.
Shawn:
Same thing with like debt from the OWE. If you take on more debt, by necessity, one of those other three categories has to shrink. Unless your income goes up, then of course the pie just got bigger. It’s going to be divided into those four things. If your income hasn’t changed, anytime you increase one of those categories, something else or multiple things have to go down.
Bob:
It has to add up to 100%.
Shawn:
It’s just math.
Bob:
It’s just math. So, we have talked a lot about this and we’re down to just the last five minutes, five or six minutes of the program, which is where we actually do, yes, we get into some numbers.
Shawn:
A little bit.
Bob:
A little bit of numbers.
Shawn:
We’re not going to tell you a specific dollar amount because it’s going to vary.
Bob:
Numbers do play a little bit in this and they have to, because it is budgeting. I know we talked about budgeting without numbers, but here are a few numbers because this is very necessary. Really, in looking at budgeting for many, many years, it kind of breaks down into what you have as your necessities, your essentials, and your non-essentials.
Shawn:
That’s right. Think of it like this. Again, we’re not technically giving you the specific numbers, but more so breaking down the categories. These seven main essential categories, it’s what you need to live on. These make up the, of the four categories we talked about previously, the LIVE category. That’s how money can be used for live. The first one is groceries. This should not be including your eating out budget. That’s a luxury. You do not have to eat out. It’s something that’s nice to do.
Bob:
I didn’t know that.
Shawn:
Groceries, not eating out.
Bob:
I knew that. I knew that, Shawn.
Shawn:
I’m sorry for all the the restaurant owners that are watching this right now. I’m sorry, but that is true. It’s not a necessity. It’s a luxury. Number two is clothing. Number three, housing, you got to live somewhere.
Bob:
Let me stop you right there. What we’ve just mentioned, food, shelter, and clothing. You’ve always heard that, my whole life. You’ve got to have food, shelter, and clothing.
Shawn:
Now the next part is for that housing, you’ve got to have utilities.
Bob:
Got to have that in the south especially.
Shawn:
Your electric, sewer, garbage, gas, water. Gas if you’ve got gas at the house.
Bob:
Like air conditioning down here, and with the cold winters you;ve got to have the heat up in the north.
Shawn:
Transportation.
Bob:
That’s autos.
Shawn:
Unless you’re working from home, you’ve got to have a car of some kind. Even if you don’t work at an actual office and you’re working from home, well one of you have got to get groceries at some point. Number six, medical. Number seven, insurance. You’ve got your home, auto, life, and we definitely recommend disability if you don’t have it. You’re far more likely to need that than you are to need life insurance.
Bob:
Everything, every essential, falls under just these seven areas.
Shawn:
If they don’t fall underneath there, guess what? Not essential.
Bob:
When you break it down like that, it’s not so complicated. You’re not saying, we’re not saying 25 or 30 things. You’ve seen these huge spreadsheets. There’s subcategories that come under these, but really it all falls under these seven main categories. Then you have your non-essentials and you just decide how much per month are we going to have of those non-essentials.
Shawn:
The non-essentials then, are everything else not falling into one of these categories we just mentioned. Whatever’s left over after “live”, which we just covered. The seven categories LIVE, GIVE, OWE, and GROW is your maximum for the non-essentials. Whatever that math ends up being, for some people it’s going to be a lot more. Some people it’s going to be less, which is okay, but whatever’s left over after that is what you have for non-essentials. If you’re spending money on these or allocating money into these before you’ve allocated to LIVE, GIVE, OWE, and GROW, then you’re setting yourself up for failure. Plain and simple.
Bob:
Here we’ve covered the right mindset. The last very thing that I want to cover, Shawn, and I know you put some more programs here. It has become so easy today to budget because of all the programs out here. Name some of them.
Shawn:
To set reasonable expectations for your essentials and non-essentials, we highly recommend that you use a budgeting program. Many of them are free. My wife and I use Mint by Intuit. That’s one of them. Not an endorsement. Just happens to be what we use. Two other ones that are really good as well is Simplifi by Quicken.
Bob:
That’s what I use.
Shawn:
Then Monarch Money is also a really good one.
Bob:
I haven’t heard of that one.
Shawn:
It’s a little newer than Mint and Simplifi, but it’s highly rated and it’s very pleasing to look at. It works really well. Use one of these because most of them are available in your web browser and smartphone apps to help you track everything daily.
Bob:
It does it for you. Everything’s done for you.
Shawn:
It’s all about, you set it up and if you’ve got the right mindset, and then you start doing a little bit of numbers. It definitely makes it a little easier, too, because as you’re making transactions, as things are coming in, it allows you to very easily categorize those. Then the longer you use it, the better it gets where you know exactly where stuff needs to fall.
Bob:
See, these programs, I think, have been really made for the people that are not like us. We love this math and spreadsheets.
Shawn:
I still use these, too.
Bob:
I still do because it simplifies it so much, but if you’re not that numbers person, which the majority of people aren’t, then this is the way to go. Get the right mindset. Use this program. You’ve got it covered.
Shawn:
There you go. Exactly.
Bob:
Well, I hope this has been very informative for you. You may have to listen to this a couple times because there’s a lot to this to get the right mindset.
Shawn:
Thank you so much for joining us. If you did like this video, hit that like button, and even if you want more content like this, again, we’d love it if you’d hit that subscribe button. Thank you so much for joining us. God Bless.
Outro:
We invite you to listen to all of our past episodes, covering many financial topics from a Christian perspective. To make sure you don’t miss any of Bob’s upcoming episodes. You can subscribe to Christian Financial Perspectives on iTunes, Google Podcasts, Spotify, Stitcher, or Amazon Music to learn more about integrating your faith with your finances. Visit Christianfinancialadvisors.com or call (830) 609-6986.
Disclosures:
Investment advisory services offered through Christian Investment Advisors, Inc DBA Christian Financial Advisors also known as Christian Financial Advisors Management Group, a registered investment advisor. Comments from today’s show for informational purposes only, and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 141 – Should I Still Wait To Build Or Buy A HomeShould I Still Wait To Build Or Buy A HomeIs building or a buying a house something that you should consider right now?
More episodes >>
We’re back to the topic of “building or buying a house” that we covered last year around this time, but we are coming at it from today’s ever-changing housing market. Buying or building a home is something that probably 100% of those listening have done, thought of, or plan to do. However, in today’s economy and right at this moment, is this something that should even be considered?
Should you STILL wait to build or buy a home? Bob and Shawn delve into the math of this topic with statistics on financing percentages, past trends, and exceptions to the rule. So, if you were thinking about building or buying a house in the near future, this episode is definitely for you!
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Podcast ChartsCase-Shiller Home Price Index Chart
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The Cycle Of Market Emotions
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Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersWant to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
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EPISODE TRANSCRIPTIntro:
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with the biblical worldview. Here’s your Christian Financial Advisor’s host, Bob Barber and his co-host, Shawn Peters.
Shawn:
Welcome to another episode of Christian Financial Perspectives. We’re so glad you joined us. If you do like videos on all kinds of financial topics, but from a Christian perspective, we encourage you to smash that subscribe button and give this video a like. Today we’re going to be covering a topic that last January we did touch on. This is kind of a revisit or 2.0 part two on, “Should You Still Wait to Build or Buy a Home Today?” Now, I do want to give just a quick heads up. It is Cedar season and it’s hurting me a little bad right now. For those not in central Texas, it just means bunch of bad trees trying to hurt people. I will do my best to edit things out if I do cough or anything.
Bob:
Hey, I’m going to help you, Shawn. I’m going to be right there with you. Like I said, last year, it was this very week that we did a program on should you wait to buy or build a home today, and a year ago, we warned you not to do that. Today’s program is going to be called, “Should You Still Wait to Build or Buy a Home.” I think it’s good to go back and look at some of the things we covered last year, Shawn, and the many reasons that last year you should wait. Some of those reasons were, we were coming off of an eight to 10 trillion.. eight to 10 trillion. It’s hard for me to
Shawn:
Trillion, drillion, quadriIlion, I mean whatever. It’s all about the same. It’s a lot.
Bob:
Eight to $10 trillion of financial stimulus from the government that put the economy in hyper mode. That was in 20 and 21. To think about that in context, that was $24,000 on average for every man, woman, and child in the United States. That’s throwing a lot of money into the economy and it artificially stimulated the economy and real estate beyond anything that I’ve ever seen in my life. Then you add on top of that artificially low interest rates for mortgages, and that was coming to an end. It was for the first two or three months of last year, but now that’s ended completely. The Fed, also we warned last year, and they’ve done it now. They were tapering off the buying of $130 to $150 billion of mortgage bonds per month that they were buying, and that created massive liquidity in the mortgage markets. It really made the mortgage markets very loose. A lot of it was easy to find money.
Shawn:
They were pulling back on doing that.
Bob:
This massive stimulus again, created artificially high real estate prices, and not last but least, we talked about the emotions buying chart last year. It was showing across the board, “sell, sell, sell” not buy. It was not a time.
Shawn:
The indicator was sell, not a buy.
Bob:
We’ll take a look at that emotions chart. We can put that up on the screen for you and you can see that. We’re kind of getting at a point now to where, in the next six months to maybe a year. It maybe time to buy, but not yet. Not yet. You should still wait.
Shawn:
To answer the question of, “Should you still wait to buy a home in 2023?” Yes. In almost all cases, except a few. Obviously we keep that in mind even where we live here in New Braunfels. There are definitely some pockets. These areas where the home isn’t on the market for even 30 days. I mean, it’s gone quick.
Bob:
But that’s an anomaly.
Shawn:
That’s an anomaly. So keep that in mind. Just because you know of a small area or you know of a home that sell really quick. What we’re talking about here is the market as a whole.
Bob:
Not those unique situations. Shawn, the purchasing power that buyers had; here’s the reason number one. We’re going to go through four or five reasons. Number one why you should wait. The purchasing power that buyers had in 2020, 2021, and half of last year in 2022 is gone. I mean that purchasing power and the national. I say that because the National Association of Realtors estimates that 87% of all home buyers use a mortgage loan to buy a home. You’ve taken out 87% of the market. The purchasing power has been cut dramatically. Here’s an example of that. A year ago, someone that wanted to go buy a $750,000 house could buy that with a $3,000 a month mortgage payment. That’s pretty high, but still. If you wanted to buy that at today’s rates, now that $3,000, mortgage payment will only finance 450,000. That’s a
Shawn:
$300,000 drop.
Bob:
A $300,000 drop in purchasing power In just one year. Now, that’s kind of the higher end of the market, but let’s get to the area that most people were in. A year ago, a $2,000 mortgage payment could finance a $450,000 home. Today, that’s a $300,000 home. The purchasing power has gone down by $150,000 for the average person that’s a lot for that to drop.
Shawn:
Which makes sense. because most people, when they’re looking at buying a home, they’re looking at, how much can I afford per month? Well, for most people, how much they can afford per month didn’t really change. Which means the price that they can afford, the ultimate price, has to go down. That’s crazy to think that from 450 to 300,000.
Bob:
Prices of homes have to drop dramatically, Shawn, to compensate for the rise in interest rates over the last year. Remember what we said last year when we made this program.
Shawn:
It’s just math.
Bob:
It’s just math. I think it will happen. It’s happening a little slower now because so many people bought homes in the last couple years at low interest rates. The turnover rate’s going to be slower because they don’t, they realize if they sell their home, they can’t get that 3% interest rate anymore. We are going to see a major drop in that, especially for the home builders that just produce and produce and produce. If you’re thinking that rates are going lower or returning back to where they were, you really need to think again. Look at this chart that we’re putting up on the screen.
Shawn:
Now Bob, especially for those who are listening as well, what exactly is this chart showing us?
Bob:
This chart is showing us the Fed funds rate for the last 50 years. For the last 50 years you can see the “means”. The dotted line that you see in the middle there. That’s the “means”. That’s where the average is.
Shawn:
The average, right.
Bob:
You can see right now, all we’re doing is returning to the means. We make our program, just so you know, we usually make them about a week in advance. As this comes out, we’re right there at a quarter percent increase that the Feds about to do. That means they’ve returned to the “means”. You can see the rates were kind of artificially low since 2010, 2011. We’re going to point out a trend line here in just a minute that shows how we’ve come off both the trend line from 2010, 12, 13, right in there, and there’s the long term trend line. That’s the Case-Schiller Price Index. That goes way, way back. The second reason to wait is prices have got to get back to those trend lines. We’re going to look at that now, and I’m going to explain this to you. This is the Case-Schiller Price Index nationally of home prices. Going all the way back. You can see here to about 1985.
Shawn:
Yeah, 85.
Bob:
Right, during that time. You can see the black line on here, iff you look at this chart. Those of you that are listening to the podcast, I would encourage you to really go to YouTube and pull this video up. You need to see this chart and that other chart on the interest rate.
Shawn:
We can describe it though. The long term trend line, like Bob said, going back from about 1985. Right now, we should be at around, a 200% increase from from 1985. Whereas the more short term trend line, which this was starting, what would you say Bob, it’s about 2012 maybe?
Bob:
Yeah, about 2012, then you can see that cross right here on the line at about 2015.
Shawn:
From around 2012, so this was after the 2008 bubble and things had dropped quite a bit, and they were starting to recover. From there all the way until around 2020, we’d been on a pretty consistent, more short term trend line, and according to that one, we would be at about 275%. Again, compared with 1985.
Bob:
This is up 366%. It’s huge, and you’ll see I pointed out the 2008 bubble. How it got back down to the trend line. Then there’s a long term trend line. Then you see the stimulus line. That’s all the stimulus.
Shawn:
That’s where we are right now.
Bob:
You’ll see my little red, arrows I have in there with a circle. That’s where I feel that the prices are going to end up being right in between the short term and the long term trend line.
Shawn:
Kind of a best case, worst case scenario. Where best case scenario maybe we only really come back to around where we should be according to the short term trend line. Then your worst case scenario, if you’re looking at selling your home, I guess. Your worst case scenario would be coming all the way back to our long term trendline.
Bob:
That we’re way away from that. That would also be considered the “means”. Shawn, everything in my 38 years of experience always returns back to the “means”. The trend line. Like the interest rates are doing right now. This chart is a very compelling chart. So the third reason…
Shawn:
Home prices are unaffordable.
Bob:
They haven’t dropped yet and we’ve had a rise in interest rates, and quite frankly, the home prices are just now unaffordable to people.
Shawn:
Yeah.
Bob:
Even if interest rates would’ve stayed low, they were getting unaffordable.
Shawn:
They were getting out of hand, but when you’ve got a lot of these homes that the prices haven’t dropped yet, they haven’t come back to reality, and interest rates are so high. It’s like that person we were talking about the $2,000 a month mortgage payment. Well, who’s going to be able to buy a $450,000 home on a $2,000 a month mortgage payment? They can’t.
Bob:
Yeah, they can’t.
Shawn:
Most of the houses haven’t even come back close to the $300,000 in that kind of a scenario.
Bob:
Shawn, this is just mathematics again. If anybody says, “Y’all are crazy.” By the way, last year, there were the exceptions to the rule, but the rule was most of the realtors said, “This is not going to happen.” This is mathematics all right. You can deny mathematics only so long. One plus one equals two and two, and two is four, and so forth. You can’t deny it. You can say that one plus one doesn’t equal two, but it does.
Shawn:
What was the thing I think I’ve heard you say before? It’s liars figure, but figures don’t lie. I mean it’s math.
Bob:
The exception to the rule, though, there is an exception to the rule about possibly buying that house now. That would be if the home is in a unique situation, a unique property with limited availability. Some examples of that would be waterfront homes. Like here in New Braunfels, there’s not any left. When one comes on the market, that’s an anomaly. I mean, that doesn’t happen very often. When they do, it’s going to show up.
Shawn:
It doesn’t mean the prices won’t drop some because of interest rates. However, those kinds of places, if it’s a waterfront home on the river, lake, oceanfront where there aren’t any more spaces to build on that water. Well then those are going to hold their value better. Even those homes will see a decline because it’s just math.
Bob:
An an older home like we have where you live. You are in a area where they’re older homes, but they have the larger lots and those are very sought after.
Shawn:
They got the big trees. Plus we’re even more so now in the, in the middle of town.
Bob:
A home with some acreage. Homes directly on a golf course. I’ve been looking. We go to Rockport where we have a little condo on a golf course. We’ve been looking for a home on a golf course forever. When they come up, they just go fast. There are some that are way overpriced that are not going, but I know the price range down there. There’s a certain price range. Home with a unique view. We have some of those here in our own town.
Shawn:
I would think for a good example on that is a home where the area that they have a nice view of is maybe they’re overlooking some sort of park, or something where there’s not going to be someone building on it later. I know right over where we live down the hill a little further, there’s a nice area that for a long time has had a great view. Then all of a sudden new subdivisions going in, and now they have a view of other people’s homes.
Bob:
Oh no.
Shawn:
A really unique custom built home, or maybe a home that’s just in a really good location with limited building space. Maybe from zoning issues or things like that.
Bob:
Shawn, we just described in those five or six examples, that’s not the norm.
Shawn:
No, it’s not
Bob:
That’s not 80 to 85%. The old 80 20 rule; that’s not 80% of the homes. If you’re looking to buy or build a normal type track home where every sixth or seventh home on the block is the same. Except they do a reverse image, or they do the paint color a little bit different with a slight variation, or on a lot that can be easily reproduced a few blocks away. Then we’re saying to “wait, wait, wait, wait.” Those builders are starting to really drop the prices and they have a lot more to go.
Shawn:
Just to be clear too, we’re not saying there’s anything wrong with those homes.
Bob:
Not at All.
Shawn:
For most people, that’s what people buy.
Bob:
That’s what they can afford.
Shawn:
If those are the kinds of neighborhoods you’re looking at buying in, wait. Not only are those going to be the most affected, but part of the reason why they’re going to be the most affected is because, those are the types of builders that will get more desperate. They’ve got to move their product They’ve got to get that off their inventory.
Bob:
That brings us down to really, we’re getting to the conclusion of the program. We’ve given many good reasons, I believe, why you should wait. The timing is so important. You really want to be wise and cautious right now, and not get in a hurry. Unless it fits possibly that unique situation that is a far and few between. Those main points again; prices have to drop, it’s just math and 87% of home buyers borrow to buy, there’s no more Fed free candy, there’s no more stimulus checks coming to everyone, everything has to return back to the means, and interest rates, as we showed, are not returning to the long-term average historical levels.
Shawn:
No, they are. That’s really what what we’re seeing happening. Is that the Fed is, if anything, they’re kind of just getting to the average.
Bob:
Why did I say that? Yeah, I meant they’re not going back to the level that they were.
Shawn:
The point with that is, don’t expect anytime soon to all of a sudden get back to where the Fed fed rate is 0% to 1%. That’s not going to happen anytime soon.
Bob:
We hope we’ve given you a lot of good information today on, “Should you still wait to build or buy a home?” We’re recommending continue to wait. If you want to give us a call to talk about this, you can call us at (830) 609-6986, or even text us at that number. Or go to christianfinancialadvisors.com. Anything you want to share before we get off today?
Shawn:
No, I think we covered it. If you’re the one in five people watching or listening to this that’s buying some sort of unique home, then I guess this doesn’t apply as much. For the other four out of five people, wait to buy the home, or wait to build that home right now.
Bob:
Thank you.
Shawn:
Thanks for joining us and God bless.
Outro:
We invite you to listen to all of our past episodes, covering many financial topics from a Christian perspective. To make sure you don’t miss any of Bob’s upcoming episodes. You can subscribe to Christian Financial Perspectives on iTunes, Google Podcasts, Spotify, Stitcher, or Amazon Music to learn more about integrating your faith with your finances. Visit Christianfinancialadvisors.com or call (830) 609-6986.
Disclosure:
Investment advisory services offered through Christian Investment Advisors, Inc DBA Christian Financial Advisors also known as Christian Financial Advisors Management Group, a registered investment advisor. Comments from today’s show for informational purposes only, and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 140 – Diversification 101: Part 3 – Building ModelsDiversification 101: Part 3 – Building ModelsListen to the last of our 3 part series on Diversification.
More episodes >>
You’ve made it to the end of our three part series on Diversification! We’ve already talked about charts and sectors, and in this episode Bob and Shawn discuss putting everything together to build a properly diversified investment model. There’s a lot that goes into being properly diversified, and it is not something that just happens over a day or two of learning. It takes time, education, and lots and LOTS of research.
If a properly diversified investment portfolio is truly something that you are wanting to achieve as a do-it-yourself investor, then these episodes are a great place to start. However, this is just the tip of the iceberg when it comes to everything that goes into diversification within investments. Are you ready to get started on your own or find a fiduciary based financial advisor to help you along the way? This episode may just help you come to a decision.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersTier GenesisWebsiteBible Verses In This EpisodeECCLESIASTES 11:2Invest in seven ventures, yes, in eight; you do not know what disaster may come upon the land.
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EPISODE TRANSCRIPTIntro:
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with a biblical worldview. Here’s your Christian Financial Advisors’ host, Bob Barber and his co-host, Shawn Peters.
Shawn:
Welcome to another episode of Christian Financial Perspectives. We’re so glad you joined us today. We’re gonna be covering part three of our diversification series, and if you like this video or in general, if you like videos on financial topics from a Christian worldview, then we would love it if you would hit that subscribe button. It costs a total of $0 to do that, so we’d really appreciate your support in that way. And of course, as always, you can like the video and share it with other people. So Bob, let’s get into part three today.
Bob:
Part three of diversification, Shawn. So we have really given a good education, today’s gonna be the last part of it. If you haven’t heard the first two parts, we’re gonna recap that a little bit and I would invite you…
Shawn:
Those will be linked on screen as well.
Bob:
Okay, good. Go back and watch them because what we’re really teaching you is how we diversify here. But if you are do-it-yourselfer or you wanna do it yourself and you wanna spend a couple years learning this, then you could do that.
Shawn:
Yeah, that’s right.
Bob:
And so the first part that we went over a couple weeks ago was the equity and fixed income style charts. And we’re putting that up for you to take a look at, and this describes when you’re going to diversify and build a portfolio that the equity style chart is all the different styles of stocks that have to do with large cap value, blend, growth. You can see mid-value blend growth, and small-value blend growth. And it has to do with the size of the companies. The large companies are your very well-known names like the Walmarts of the world, the Exxons, the big boys.
Shawn:
That’s right. The 10 billion plus.
Bob:
10 billion.
Shawn:
It’s crazy to think that now the large cap is 10 billion plus.
Bob:
When I started, like I said in the last two programs, it was about 2 to 3 billion. So, it’s really in increased a lot. And then we went into the fixed income style charts and how that all works. And it’s very, very important. This is the foundation for building a diversified portfolio is understanding where the stocks fit within all of these styles, along with international and emerging markets and domestic markets. So there’s a lot to learn here.
Shawn:
Exactly. This is just to indicate how picking the, a bunch of random different companies, for example, is not really diversification because you need to make sure you know where those different positions fall. So if you end up picking all value large cap, well, you’re not really diversified very much, even if you have a bunch of different holdings.
Bob:
The different styles will do well in different markets. Right now. the value style is working much better than the growth style as interest rates have gone up 450% in the last year. Cause they started at 0%. Now, they’re at 4.5%. not much more to go though. I will say that. It’s a good thing. They’re expecting only about another 1/2 to 3/4 of a point of interest rate rise. When you look at the percentages, that’s only a 15% more to go to get to that point. So that’s a good point.
Shawn:
It’ll be interesting to see how a lot of your very growth focused positions companies will handle the next few years with all these changes that we’ve had in interest rates and just the economy as a whole. We’ve seen tons of the larger tech companies laying off people, which is really sad. They brought on a lot of people, but now they’re laying off a bunch of people. And I just wonder if we’re gonna see more of that where the growth focused companies are gonna have to really scale back, and you’re gonna see more of the value focused going forward.
Bob:
Yeah. And the value focus normally has a lot less debt or no debt at all. So that was the first week, that was two weeks ago. And then last week we covered all the different sectors. And we went into the industries of each sector. So you have 12 different sectors. If you look on your screen, you’ll see that.
Shawn:
And I’ll go ahead and just read them off really quick.
Bob:
Yeah, go for it.
Shawn:
We’ve got healthcare, communication services, technology, consumer discretionary, consumer staples, energy, financial, industrials, materials, utility, real estate, and physical assets.
Bob:
And there’s all these industries within each sector. So you gotta understand how all these sectors work and the industries within each one, whether you’re going to overweight or underweight in those different sectors, and how that’s going to fit into that equity style chart.
Shawn:
Okay. And then of course, depending on your own investment policy or your own investment philosophy depends on are you typically going for something that’s hot or are you going for something like here at our firm, we always use what’s called a contrarian theory. So, if we see one of these sectors or one of the industries within a sector is just really beaten down, is down 50% for the year —
Bob:
Been way over sold.
Shawn:
Yeah. We’re looking at that as that’s probably a good buy. If something is up 20, 30, 40%, well, we’ll wait for that to go on sale.
Bob:
Even though so many will say, well that’s a trend and follow it.
Shawn:
But how much longer is that trend gonna go?
Bob:
So my style, if you were to think about my style, and we always say it it around here, I’m kind of old, but my style is a Warren Buffet style. I like to buy when everybody else is selling. And I like to sell when everybody else is buying. So that’s just the way I do things.
Shawn:
And it depends on how, for those of you watching, depends on your particular investment philosophy, but you should have that. You should know in addition to this, like, how are you going to manage this? How are you gonna invest in this? For example, you can always check out our website and we’ll put the length in description, but we have our own investment philosophy that we follow.
Bob:
We’ve talked about that right here on the podcast and YouTube channel the seven criteria that we use for investing. So today what we’re going to cover is building models. It’s taking all of this, these sectors and using the equity style chart, fix income style chart and building the models that go with that. And we’re gonna try to go through this very quickly, because it could take an hour, we could definitely spend an hour on this. We’re not; we’re gonna spend just minutes on each one. But we take the models, use these sectors and style charts, and we’re just gonna talk about five main models. There’s more models in this. But we’re gonna talk about the five main models and what we do here at Christian Financial Advisors. And we have these five main models. They start with ultra-conservative, then we have conservative, then moderate or balance, then growth, and aggressive growth. So Shawn go into how we build that first ultraconservative portfolio.
Shawn:
Yeah. So the first one, the ultra-conservative, is what would be considered a 100% fixed income model or portfolio, depending on your particular nomenclature you’d like to use. So for this one, it has the least amount of volatility, and we use the fixed income style chart plus some investments outside of the boxes, like maybe CDs, money markets, possibly some dividend paying stocks like the real estate sector, but just a very small percentage. Whatever it is, even if it’s not technically considered fixed income, it is something that would be very value focused and large cap, so it’s really no growth expected. It’s just paying dividends. So again, the focus on this is producing consistent income. This is not for growth.
Bob:
And it’s going to be your least volatile type of portfolio.
Shawn:
But there’s still volatility. Obviously, I mean, even in 2022, every market was down.
Bob:
Well, 2022 was so unique because we were taking interest rates from zero, like I said, up over 450%.
Shawn:
Exactly. But keep in mind, obviously fixed income was not hit nearly as hard as the overall equity market.
Bob:
Not, not near.
Shawn:
So this would still hold true that there is the least amount of volatility. But it doesn’t mean it’s immune to any kind of volatility.
Bob:
So, then you take one step up and what that means is you’re just having less fixed income. So this is typically going to hang out in the 80% fixed income arena.
Shawn:
Well we say 80/20.
Bob:
Yeah, the 80/20 and then the 20% equities. Now these equities that we’ve been doing in a conservative are going to be more of your conservative equities as well. So, they’re gonna be more of your large cap value, your dividend paying stocks. Where when we get up to the fifth portfolio we’re gonna speak of, aggressive growth, that’s not gonna have near as much large cap. It’s gonna have more mid-cap and small cap in it and emerging markets.
Shawn:
And conservative, you could have some large mid-cap blend, but you’re not gonna have a whole lot of mid-cap and definitely not small cap. At least that wouldn’t be recommended.
Bob:
So we call this our conservative portfolio. So we had ultra-conservative, then conservative, then we break right into the middle. This is actually our number one portfolio that we have here. I would say probably across America, it’s probably, that’s where most people have their money. And that would be in a moderate or a balanced portfolio. And it’s really focusing on a 50/50 mix.
Shawn:
Yeah. It could be a 50/50. I know for us here, a lot of times we will be at like a 60/40 on the, well, I guess just the whole truth, how we’ve doing this. So fixed income then equity, this would be a 40/60 usually, but it could be a 50/50 and obviously just kind of depends on your particular style of management that you’re following or if you are working with a larger company. But for us, it’s usually 40% fixed income, 60% equity. And because we are also a tactical management firm, sometimes we will adjust those numbers down if the market just seems overheated.
Bob:
Well, like last year, we felt like the market was way overheated. We’re talking in 2021. 2021. Because now this is 2023, so it wasn’t last year, it was the year before that. We went from a 60-65% exposure – it had gotten to 65 because our growth part of the portfolio got so hot. And everything was going up so much, we pulled that all the way down to 30-35, so we took it way, way down on the equities. That’s not normal, though. Normally, you’re gonna be 50-60% equities and 40-50% fixed income in a balanced, moderate portfolio. And you’ll see this across the board if you go start looking around at the different asset allocation in the different big firms.
Shawn:
We did that again, just a very, very short term like over a few months at most because then, as we started to see, some of the positions that we had either previously been in or were looking at moving more into, one of ’em was one of the funds that we used for healthcare. Healthcare was way down for the position that we would normally buy into, and so we moved more back into that position. And then kind of throughout the year, especially in the first six months of the year, we were deploying more and more of that cash that we had pulled back back into those equities, which just a form of dollar cost averaging. Again, using contrarian theory for us, we, here at the firm, we wanted to look for those opportunities of things that were on sale, if you will.
Bob:
And so it was a good move. It’s been a very, very good move.
Shawn:
And it doesn’t always show up as as a huge benefit. So, if you are using this tactic yourself at home or you’re interested in how we do it here, it won’t necessarily be a huge difference in that first 12 months, I would say. But it’s one of those where over the next two or three years, you start to kind of notice a difference between if you had just held onto everything versus if you did tactically kind of move in after the markets have gone up, move back in as it goes down, that’s when you start to notice that difference from that cost basis.
Bob:
So next, we get up to what we refer to as our growth portfolio and the growth portfolio still has some fixed income in it. But now instead of that being like it was in conservative where it was 80% fixed income, now it’s turned all the way down to 20% fixed income and maybe even a little less than that. And the equity portion can be up to 80% in the equity portion. And this is more going to be towards the growth side of the equation, too. You get back to the equity style chart and you take a look at that and that’s gonna be on the growth side, not on the value side. Now, you can still reach into value and we were doing that this last year, and we are still there right now in our growth,
Shawn:
But it is going to be more small and mid-cap as far as the valuation side. and then obviously depending on the need, it’s gonna be more growth could have some value or blended in.
Bob:
And if you remember back in October of 2021 in our growth where we were 80-85%, we pulled that back to 60%. So, we pulled back a lot on that. And now we’ve moved back into those, we’ll see the major benefit of that will be when the markets rebound. And history shows us, the markets have always rebounded. Will they always rebound? We can’t make the statement that they always will.
Shawn:
But history has shown that they, so far, have always rebounded.
Bob:
100% of the time.
Shawn:
I mean, in my opinion, Bob, if the markets don’t rebound, there’s probably much bigger concerns anyway that I don’t know who’s gonna really care about the markets anyway.
Bob:
Exactly. And there’s cycles and we’ve mentioned this many times in Ecclesiastes, there’s a time for everything. There’s not always gonna be good times, and there’s not always gonna be bad times. So when you’re in bad times, think about the good times because they’re gonna come around. When you’re in good times, you need to prepare for the bad times. And then this brings us to our last portfolio, which is…
Shawn:
Yeah. So the last one for our firm here, it’s usually around the 0% on the fixed income, but it could be up to 10% fixed income. And then the equity side of it is based on those numbers, you know anywhere from 90% to 100%. I would say the average is usually about 98%.
Bob:
That’s correct.
Shawn:
We do usually hold back just a little bit for cash. And this would be considered aggressive growth. So these are, again, this is almost 100% equity and it’s obviously gonna be a lot more small and mid-cap. It’s very growth focused. There may be some positions or sectors in there in the aggressive that we might not use in some of our other models just because, again, they are more aggressive.
Bob:
They’re a lot more volatile, and you gotta be able to handle extreme volatility when it comes to the aggressive growth style because you are, like you said, you’re nearly all equities and stocks. They fluctuate much more than a fixed income. So these are our five main models and we’re gonna talk about how we use them.
Shawn:
One thing I wanted to highlight, too, Bob, to keep in mind these five different models that we highlighted, they also all have a average expected investment time horizon associated with them. So for that volatility to make sense, there also needs to be an assumption that, like for aggressive, I’ll start there with aggressive, if you don’t have at least 10 years, maybe even 12, but at least 10 years that you’re gonna put the money in aggressive and not touch it at all and not panic and withdraw the money, then you have no business investing in that aggressive of a fund or model. And then it kind of goes down from there where, I mean, even ultraconservative is if you don’t have at least two to three years —
Bob:
That’s correct.
Shawn:
Then put in a CD. Put it in a high yield savings account. Like there’s no reason to even invest it in even something like ultra conservative.
Bob:
Which we do here. We do CDs. We have what we call our non-managed CD or we can buy treasuries with that. We don’t charge a management fee, it’s just a onetime fee to move into that.
Shawn:
Unless you’re doing it on your own.
Bob:
And it’s a very, very low fee. I will tell you right now, for $1000,000 CD it’s $300. For a $50,000 CD, it’s $150. So it’s basically 30 basis points one time once we buy that for you, and we can actually buy the same CD you can get at your local bank, we can get you a lot better rate. That’s kind of a weird deal.
Shawn:
That’s the main thing just to keep in mind is not just what those percentages are and the asset mix, but also keep in mind that the more aggressive you go, the longer in years, not months, but the longer in years you need to be willing to leave it invested. Otherwise that volatility, if you time it wrong, could really hurt you in the long run.
Bob:
It could. It could. And we have other models that are outside of this, like a real estate model or healthcare model or energy model. It’s all the different sectors. You could have models within there. So as you can see, this is very complex. It’s all about overweighting and underweighting between all the different parts, and we use all these same methodologies between fixed and equities. And the main thing, once you learn how to do all this is you gotta understand where do all these models fit for you and your long-term goals, your short-term goals. Some of our clients, they’ll use all five of these models. Some will use just two or three. It all depends on what your short-term and long-term goals are and how all that fits. This is the most important part, how it all fits within a comprehensive interactive financial plan.
Shawn:
That’s right. Because choosing which one of these models to go into when, like you said Bob, whether it’s 1, 2, 5 of them, really comes down to the question of are you nowhere near retirement? Are you getting close to retirement? Are you in retirement? If you’re in retirement, what are your actual income needs that you need to cover your expenses for retirement now that you’re not working anymore. And so, if you look at that and you figure out those numbers, then you get to the question of, okay, great, well if I need, let’s say I need $60,000 a year in today’s dollars. Okay, well if I need $60,000 a year and I have $800,000, okay, how much of that should I put into something that’s more conservative, like the ultra-conservative account,
Bob:
I’m gonna say about five years.
Shawn:
Yeah. About five years ago.
Bob:
So you need to have $300,000 in around ultra-conservative or conservative, and then beyond that, you can get over into that area.
Shawn:
Exactly. Exactly. And then the idea with that is of course we do this for our clients, but the idea being that you have your less volatile account with five years worth of capital for those income needs, so that way the rest of your portfolio can stay invested longer with a little more growth focused, because even if it just averaged 0% in your ultra-conservative, well in that case, you’ve still got five years before you might have to potentially touch the more growth focused account.
Bob:
And we call that…
Shawn:
And that’s a real simple example.
Bob:
I call that outlasting a bear market. That’s the bottom line is you can outlast a bear market when you have enough outside of the markets to take you through that bear market. Bear markets normally last 13 months. Which, by the way, it kind of says our bear market officially started in ’22 around June. A bear market is where it’s down 20% or more, correction is between 10-20%. So where it was down 20% or more, it started in June, average is about 13 months. If we do that average, we’re looking at June to July of this year that we would be coming out of that market. And the good thing is too, like I said, a lot of this has been cost from the fed lowering interest rates from 0% to 4.5%. They’re expected to go, in February 1st is the next time, they’re expected to announce another 0.25% and maybe another 0.25% or 0.5% on top of that. So the fed’s basically done, they only have 15% more to go, which is a good thing. So they’ve raised them 450%, it’s taken the market down 20%. So if you raise ’em another 15%, how much more down is that gonna take the market?
Shawn:
Right, exactly.
Bob:
Okay. With all this being said, in today’s part three, you’ve got part two and part one, you can definitely, you could do this yourself if you’re willing to devote years to it and learning how to do this and know how all this goes together with a comprehensive financial plan. Or, you can hire a fiduciary fee-based financial advisor like we are. Another thing that we didn’t even mention, I forgot, we want to make sure to do this, is we put all this, also, through our Biblically responsible, values, morally based screens before we put the holdings into the portfolios, and then we gotta put it through all the financial fundamentals, which is extremely important too. We got so cought up in all the different models, I forgot to mention that, which is the most important part.
Shawn:
Yeah. All of this and then great, here’s our top 30 picks for the 10 that we’re trying to isolate down to. And then we’ll screen through all of those and say, okay, which one of these actually pass our faith-based screens for Biblically responsible investing? And then we can finally narrow down our choices.
Bob:
Yeah. Financially, is it gonna make it? What are the PE ratios? How’s the company, how much debt is in the company? et cetera. What are the analysts saying about it? So, that concludes this three-part series. I hope this has been very helpful to you. It’s always good for me just to talk it out. I realize how much we do and how many years of experience has gone behind this. And Shawn, it really hit me as I was coming to the conclusion of this. You see these TV commercials that just show somebody doing this on their lunchtime with an app and these companies, these brokerage companies advertising online investing, and that is insanity to me when you look at what goes into this. You don’t just, you can’t just do this over lunchtime. If you have the time you wanna commit, you need to commit 20 or 30 hours a week to this, to learning this for many years, and then you could be ready to do it yourself.
Shawn:
Well, I’d almost argue, Bob, that if it really was that easy for people to be successful consistently over years, not just, oh, somebody’s been trading for a few months or something like that, but for a couple decades, how many hundreds of billions of dollars under management do you think we would have right now if we could just do it that easily?
Bob:
Yeah, that’s right. Most definitely.
Shawn:
So I think the idea there is that, yeah, sure, maybe it works for a little while, but it’s not gonna really work for a long term strategy. It actually, believe it or not, takes work and knowledge and diligence and a plan to be successful with this.
Bob:
Just like the mechanic now. I mean, I can’t work on my own car. It’s too complicated. So I’ll look at all that. So if you would like help from a fiduciary fee-based Christian advisor, we’d love to help you. You can contact us during business hours at (830) 609-6986. You can also text that number if you’d like to, or you can find us on the web www.christianfinancialadvisors.com.
Shawn:
Thank you so much for joining us on this episode. God bless and have a wonderful day.
Outro:
We invite you to listen to all of our past episodes, covering many financial topics from a Christian perspective. To make sure you don’t miss any of Bob’s upcoming episodes. You can subscribe to Christian Financial Perspectives on iTunes, Google Podcasts, Spotify, Stitcher, or Amazon Music to learn more about integrating your faith with your finances. Visit Christianfinancialadvisors.com or call (830) 609-6986.
Disclosures:
Investment advisory services offered through Christian Investment Advisors, Inc DBA Christian Financial Advisors also known as Christian Financial Advisors Management Group, a registered investment advisor. Comments from today’s show for informational purposes only, and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 139 – Diversification 101: Part 2 – SectorsDiversification 101: Part 2 – SectorsDelve into the world of financial and industry sectors in this latest podcast episode on investment diversification.
More episodes >>
In this second part of our three part series on diversification, Bob and Shawn discuss the different sectors and industries in which one can invest. Not only are there several areas of financial industries and sectors, but each of these are divided further, and those are divided smaller as well. A well diversified financial portfolio should include many of these sectors and their subsets.
However, how exactly is this accomplished when there are so many across so many different industries? Find out how and delve into the process of properly diversifying your investment portfolio across the different sectors in this episode on Diversification 101.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersTier GenesisWebsiteBible Verses In This EpisodeECCLESIASTES 11:2Invest in seven ventures, yes, in eight; you do not know what disaster may come upon the land.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTIntro:
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with a biblical worldview. Here’s your Christian Financial Advisors’ host, Bob Barber and his co-host, Shawn Peters.
Shawn:
Welcome to another episode of Christian Financial Perspectives. I’m so glad that you’ve joined us today, whether you’re watching this online, on YouTube, or you’re listening in on one of the podcast directories. If you are on YouTube and you like this kind of content where we cover financial advice and other topics but from a Christian and biblical perspective, we’d love it for you to like this video, share it with others, and especially hit that subscribe button, so you can know anytime we release a new video. And today, we’re gonna be covering part two of our three part series on diversification. Bob, you want to get us started?
Bob:
An exciting subject to me because we’re into this every single day. This program is a good program for DIY, the do it yourself worker, or somebody that just wants to know how we at Christian Financial Advisors, how we build our portfolios, which is pretty complex. And I thought in the beginning, Shawn, I was gonna be able to do this in one part, and then I realized as I got deeper in, it was gonna take three different parts to do this or else we’re talking an hour on this, and we don’t wanna lose anybody. Last week, I want to do a recap, so if you didn’t get to see it, I would invite you to go back and take a look at it. It had to do with the equity style and fixed income style charts. There’s nine blocks in each chart. I’m gonna have Garrett right now show you those charts that we went into detail what each one of those blocks meant. So today, what we’re gonna do is we’re going to talk about the 12 sectors that can fit within all 18 of those blocks, Shawn, being that there’s nine in the equities and there’s nine in the fixed income.
Shawn:
That’s right. And then we go into all the different sectors. And before we get that much further, let’s go ahead and read Ecclesiastes 11:2. This is from the NIV, “Invest in seven ventures. Yes, in eight, you do not know what disaster may come upon the land.” And I feel like that fits pretty well with diversification and coming from arguably the wealthiest, by a small margin, man that ever lived. What was it? I think Austin told us it was something like $6-7 trillion dollars, like adjusted for today’s.
Bob:
If Solomon would’ve been living today, and there’s nobody in the world now.
Shawn:
To my knowledge, we don’t have any trillionaires.
Bob:
Right. We just have a lot of billionaires.
Shawn:
We have billionaires, like multiple hundreds of billions. But I feel like anything with a trillion, if that’s your net worth like Solomon would’ve had, I feel like you’re probably first place.
Bob:
If Solomon, who knew how to build wealth, you realize he didn’t put it all in one thing, did he? He diversified it over seven or eight sectors. You hear me preaching a lot here about this, especially to those that love real estate. We live in a big real estate town. A lot of people have gotten wealthy on real estate, and they think that everything should be put in real estate. Well, that flies right in the face of a scriptural principle.
Shawn:
That’s right. And there’s also a scriptural principle about there’s a time for everything. So, yeah. You may have done well for quite some time with real estate, but just like any other market, they all go through cycles, which is why you would be prudent to diversify properly, which means not just real estate. And before we go further, Bob, I actually have something really exciting, especially if anyone is watching, listening that didn’t get our last episode. But we’re very excited to announce we have a new program that we’re calling “Tier Genesis”. And we’ve made this in mind with those who are a little more DIY, as well as those who are households that wouldn’t meet our normal $100,000 total assets minimum. And so, this is a program that is an all digital program, and you can go directly to the website and sign up and get started. You’ll have access to the same investment management that we do for all of our clients already, but by offering it through a little bit different of a program and service, we can help those who don’t meet our normal minimum, but are maybe young family or young professional people trying to get started, or those who just maybe haven’t built up as much, as well as if you are the type of DIY with your advisor where, “Don’t call me, I’ll call you.” So then this might be for you.
Bob:
Maybe you have $500,000 or even 2 million or 3 million.
Shawn:
And you just want what we do, but don’t call me all the time. I’ll call you when I need you. Well, this is for you. And so if you wanna learn more about that, or if you’re really excited, you’re like, Hey, I wanna get started, check out tiergenesis.com. That’s T-I-E-R genesis.com. We’ll have that in the description and on the screen as well.
Bob:
And now we’re gonna get into the sectors. And hopefully, we’re gonna try to do this very quickly. Garrett’s going to be putting up each sector, but then we’re gonna talk about within each sector the industries of those sectors. So you’ve got 12 different sectors. First one is healthcare. So Shawn, the four industries that we invest in when we look at healthcare are…
Shawn:
1) We have healthcare equipment and supplies. And then we have 2) Healthcare providers and services, 3) Biotechnology, and 4) Pharmaceuticals.
Bob:
You can see how those four break down. The providers could be hospitals. The biotechnology would be the inventing the arm or medicine. Pharmaceuticals would come under, like we had Eventide on one time and they talked about schizophrenia, but that kind of comes under biotechnology at the same. It can fall there.
Shawn:
The point is there’s a lot of variety.
Bob:
There’s a lot of variety in healthcare.
Shawn:
You have a sector as healthcare. And then you have those four industries and even to an extent, those four industries, you could kind of subdivide those into a bunch of different areas as well.
Bob:
You sure can. Right. So the second area is communication services, and this involves…
Shawn:
Three primary industries. We have 1) Telecommunications, we have 2) Media wireless,
Bob:
Like wireless phones.
Shawn:
And 3) We have entertainment and internet media.
Bob:
Netflix.
Shawn:
Yeah. I don’t know if anybody’s ever heard of that. It’s a streaming company.
Bob:
Watching Friday Night Lights right now on it from a long time ago. I never saw that, and I’m really enjoying it. Like I was telling you earlier, it’s making me, I’m like looking and watching this series. I’m going, that is too realistic, too much like my town I grew up in.
Shawn:
Which is not something you normally think of when you watch a show.
Bob:
No, it’s not.
Shawn:
Hey, this is realistic, but sometimes it happens.
Bob:
We’ve covered healthcare communication services. Next is…
Shawn:
Number 3 is technology divided into four primary industries. We have 1) Internet software and service companies, 2) We have IT consulting services, 3) We have semiconductor equipment, and 4) We have computers and peripherals.
Bob:
So far, we’ve gone through three. Sounds confusing, doesn’t it? I mean, if you wanna do it yourself, that’s fine, if you love this stuff like we do, but we’re showing you how we take all these different sectors and then the industries under each sector, and we put that into an investment portfolio. Next week in part three, we will be talking about how we apply this and use that equity style chart and fixed income style chart for each one, because every one of these has companies and they fit somewhere in that equity style chart.
Shawn:
That’s right.
Bob:
It could be a small cap, large cap, mid-cap. It could be a growth or value or somewhere in between company. So, they all fit within one of those nine.
Shawn:
And obviously, one of the reasons why we want to cover these sectors and the sub industries or industries is because even if you used those charts and you had large, small cap, mid cap you had these different areas and you were really diversified, if all of those different positions from the equity and the fixed income were all from one primary sector or from only a couple industries, then you’re not as diversified as you might think because you’re missing a piece of it. So that’s kind of why we thought this would be a good part 2 to go over these sectors and industries.
Bob:
And you can overweight these sectors or underweight the sectors depending on where the markets are. Like a few years ago, if you remember oil, was it under $20? $20? I mean, it went negative there for a while during COVID. and then it went up to $120 this last summer. And now as we are doing the program, as we’re making the program, it’s in the mid seventies per barrel. So you look at overweighting energy as an example, a couple years ago when nobody wanted to invest in it, that’s the time when you wanna invest in it. When everybody, and I’m telling you Shawn, cause I watched CNBC this last summer. Everybody’s saying, you gotta get into oil, gotta get into oil. And I’m going, no. It’s $120 a barrel.
Shawn:
It was interesting, because in late 2020 when we moved into energy when nobody really wanted to move into energy, and it was down quite a bit. And meanwhile everybody’s talking about technology stocks, which were skyrocketing, right? Like, well then when those flip around, like, well, now maybe if the technology stocks continue dropping like they have been, at least as the time of recording, maybe now’s the time to invest in technology and not invest in energy.
Bob:
So you gotta watch all these sectors. So the Ford sector is what we refer to as “consumer discretionary”. And that has to do with like retail. How much money do you have to go spend in retail, automobiles, consumer durables, apparels, hotels. You would think, well that’s travel, but that’s consumer discretionary. That’s discretionary spending. You don’t have to go to a hotel. That’s additional dollars that you have to spend in restaurants. Now, consumer discretionary, can you imagine would do better in a good economy, right?
Shawn:
Yeah. When people have more discretionary income to spend. It kinda almost seems like it goes together with the title there.
Bob:
Yes. Correct.
Shawn:
So there are those six, and then our fifth sector we have is consumer staples, and it’s divided into six primary industries. We have food and drug, we have beverages, we have food products. Oh, sorry, that was food and drug retailing. Then 2) Beverages, 3) Food products, 4) Tobacco.
Bob:
Which we would not invest in.
Shawn:
Right. No. Again, yeah. We’re not making any recommendations in general, like on this program that we’re just listing what they are.
Bob:
I just wanna make sure people know we will not invest in tobacco here.
Shawn:
5) Household products, 6) Personal products.
Bob:
And this did really well back in COVID there, your Walmarts and like your Krogers and your big grocery store chains did very well because these are consumer staples. These are things that people gotta have, and they need now.
Shawn:
In 2020, I think the toilet paper companies had probably record sales, right?
Bob:
You remember that.
Shawn:
People buying six years worth of toilet paper for some reason. Like, guys, come on. We’re gonna have more toilet paper.
Bob:
I’ll never forget that. I remember taking pictures of that. And it’s like, you can’t get paper towels. You can’t get toilet paper. And it’s like, it was insane. The run we had on that, and then people were trying to turn around and flip it, and sell it at high prices.
Shawn:
I never thought I’d see the day that people were scalping toilet paper online.
Bob:
So, we’re nearly halfway through, which the sixth one we were just talking about is energy. But energy breaks down. It’s not just gas in your car.
Shawn:
That’s right. It’s got five primary sub industries. We’ve got 1) Crude oil, 2) Natural gas, 3) Drilling, 4) Refining, and 5) Energy related services.
Bob:
And all these will drive energy prices. Like as an example, when energy was very, very low, those that were drilling were like, it’s not worth it. But prices went to $120 a barrel. Now, everybody’s drilling. And now what’s happening is you’ve got so many drilling that you have extra supply coming onto the market that will drive the price back down. It will get down to a certain point where they’ll stop drilling. They’ll say, this is not worth it again. It’s just a cycle. And like it goes with Ecclesiastes says there’s a time for everything. That’s why all these, you’ll have energy that will rotate, but then you’ll have the industries within energy will rotate back and forth as well.
Shawn:
Well, and when you get into energy, I think that’s an interesting example is that if the prices are really high, like for the oil, then obviously there’s gonna be more of a drive for drilling and it’s exploratory drilling. But when it comes to the refinery, what’s interesting is if the oil was already purchased, the energy companies, they don’t have to refine it. They can kind of turn the valve up or down a little bit, depending on like what the market demand is because they’re trying to make as much as they can per gallon of gas or diesel or per gallon for the oil. So why would they wanna sell more if they don’t make as much? If anything, just pull that supply back a little bit, don’t refine as fast. The people always wanna blame the government or whatever political party, but energy companies have a lot of different play in that, too.
Bob:
And as we think about one of these sectors. I was just thinking about something when my head was spinning as you were doing it about energy. There’s an old Texas company here called Southwest Airlines. And they are known that when energy goes way down, they go in and buy a lot of, I mean, when oil prices are way down, they’ll go in and hedge it and they’ll buy it for a couple years. You wonder if they went and did that during COVID when oil basically went to zero for.
Shawn:
I remember seeing that in the news. I don’t remember how many years ago it was, but I remember that coming out where a lot of the airlines were really struggling when prices had gone up quite a bit. And Southwest, of course, was in the news about like, oh, well they’re actually doing great cuz they bought a whole bunch previous, or they hedged it, you know? That’s interesting.
Bob:
Next, we have financials. So this is gonna break down into financial services firms like ours. Also, banks, insurance, this insurance industry. Then you have your overall capital markets, your consumer finance, like your credit cards and then thrift companies. So all these different sectors and you’ll notice again, a lot of rotation within the financial. I saw that over the last couple of years between which one of these one of these industries would be hot while another one wasn’t.
Shawn:
Okay. So our eighth sector is industrials, and we’ve got 10 industries.
Bob:
Oh, that’s a lot of there. Go ahead.
Shawn:
So number 1) Aerospace and defense, 2) Building products, 3) Construction and engineering, 4) Electrical equipment, 5) Machinery, 6) Commercial services and supplies, 7) Air freight and logistics, 8) Airlines, 9) Marine, and 10) Road and rail.
Bob:
I have a feeling when we’re listing all these now people are starting to go, okay, can I listen to this much longer? I’m starting to have brain overload and that’s what will happen. Now like I say, if you wanna build the portfolios yourself, you can. And you use this information to do that. And that’s very good for the DIY. If you’re finding yourself as you’re listening this going, this is so much, I’m becoming overwhelmed. Again, we just mentioned at the beginning of our program, Tier Genesis. We have our Tier Genesis program coming out for anyone that can go online, tiergenesis.com and you’ll get these sectors, and we’re putting these sectors depending on where the markets are – overweighting or underweighting – into our equity style boxes that we talked about in part one.
Shawn:
We’re basically, thing of it is this, if this seems like a lot of information, either that’s good if you’re trying to do more of this on your own, or maybe you need an advisor.
Bob:
Yes.
Shawn:
Maybe it’s us, maybe not. But we just figured it would be good to both help some DIY people and also allow you guys to kind of peek under the hood to an extent to see what’s going on, what goes on in our day-to-day life and how we do what we do.
Bob:
Just so you know, there’s only three more. I know we’ve gone through a lot of these and it’s a lot of information. The last three are materials, well actually four more. We’ve got materials, utilities…
Shawn:
Real estate.
Bob:
Real estate, and then physical assets. Boy, Shawn, I’ll tell you what we need to do. There’s so many different sectors in here. Let’s just try to hit on some of these because I think we’re getting so deep into this, I can see where this could… I think I’ve had people sit across the desk from me before and they’ve actually said, you’re gonna make my head explode if you keep bringing this on.
Shawn:
Well, let’s just hit a highlight a few industries here, each one. So for number nine materials, we’ve got things like chemicals, construction materials, metals and mining, those kinds of things, paper forests. Number 10 for the sector, we’ve got utility or utilities, really just kind of one industry, but you’ve got companies that produce, generate, transmit, or distribute electricity, or you have companies that produce, generate, and transmit natural gas.
Bob:
Exactly. Our last major sector is real estate. Now, people don’t realize that there are 14 different industries within real estate.
Shawn:
So, we’re not gonna hit all of those.
Bob:
No, we’re not, but you do have your big industrial buildings, you’ve got your retail buildings. You’ve got your lodging, you have your offices, and then you have your residential.
Shawn:
Yeah. Then you have residential.
Bob:
Which apartments come into that, too. All right.
Shawn:
And then just to name a couple more. You have things like healthcare is its own industry under real estate.
Bob:
Interesting. See, that came under real estate. So, you’ve got the hospital itself. It’s the building that it sits in.
Shawn:
Exactly. So, two separate things. You could be investing in the service of the hospitals. Or you could be investing in the real estate of the hospital. Things like that. A couple other ones I think is interesting – data centers and then timber land.
Bob:
I like the one of cell phone towers, because that is real estate and you see there’s cell phone towers everywhere. So, that’s just a few of them. And then we get to our last one, which is physical assets. That is gold and silver and actual equipment. All right. Things that you can touch now.
Shawn:
So what would be a good example of that, Bob, for equipment? And I mean, I’m sure everybody watching or listening knows probably what gold and silver are, but what would equipment be as a physical asset sector?
Bob:
Caterpillar. John Deere. So, those are examples right there of investing equipment.
Shawn:
Gotcha.
Bob:
All right. So there you go. That is the 12 sectors. On the last program, again, we discussed the equity style charts. And the next and last of our series on diversification, we’re gonna be discussing how you take these sectors and build actual portfolios, which we’re gonna be going over our ultra-conservative portfolio, conservative, moderate, growth, and aggressive growth. And we’ll be talking about how you overweight and underweight these different sectors and the style charts.
Shawn:
And if you’re watching this video on YouTube, we’d love to hear from you. You can comment maybe what sector do you think looks like might have a comeback in 2023, or what’s one maybe you’re interested in? I’m sure you’ve memorized all these by now.
Bob:
Oh, sure.
Shawn:
You’ve got it after hearing them. But we just love, or just in general, just leave us a comment and tell us maybe a topic you might like to see us cover.
Bob:
And we hope this has been very educational to you. By the way, if you need some financial advice and you would like to hire somebody to do all this for you, we are fee-based, fiduciary based advisor, and you can find us on the web at www.ChristianFA.com or www.christianfinancialadvisors.com and our phone number during business hours (830) 609-6986. You can text or call that number.
Shawn:
That’s right. Thanks again for joining us. God bless. And until next time,
Outro:
We invite you to listen to all of our past episodes, covering many financial topics from a Christian perspective. To make sure you don’t miss any of Bob’s upcoming episodes. You can subscribe to Christian Financial Perspectives on iTunes, Google Podcasts, Spotify, Stitcher, or Amazon Music to learn more about integrating your faith with your finances. Visit Christianfinancialadvisors.com or call (830) 609-6986.
Disclosures:
Investment advisory services offered through Christian Investment Advisors, Inc DBA Christian Financial Advisors also known as Christian Financial Advisors Management Group, a registered investment advisor. Comments from today’s show for informational purposes only, and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 138 – Diversification 101: Part 1 – Style ChartsDiversification 101: Part 1 – Style ChartsLearn how to properly not put all of your financial eggs in one basket.
More episodes >>
This may be one of our most important podcast series to date. Diversification is a significant part of investing, and in this episode, Bob and Shawn discuss the different equity and fixed-income charts. This is a great episode series for learning the basic ins and outs of diversification within investing. Bob and Shawn also share what they go through daily to help make sure their clients’ portfolios are appropriately diversified.
On top of offering diversified investment portfolios, Christian Financial Advisors also adds both faith-based investing and biblically responsible investing aspects to our clients’ portfolios. Sit back and take a peek at how our firm works when creating a diversified investment portfolio within a Biblical worldview.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersTier GenesisBible Verses In This EpisodeECCLESIASTES 11:2Invest in seven ventures, yes, in eight; you do not know what disaster may come upon the land.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTIntro:
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with a biblical worldview. Here’s your Christian Financial Advisors’ host, Bob Barber and his co-host, Shawn Peters.
Shawn:
Welcome to another episode of Christian Financial Perspectives. We’re so glad you’re joining us today. We’re gonna be covering part one of a three part series on diversifying your investments. And if you like this kind of content on how to diversify your investments, how to invest from a Biblical perspective or just other topics on how Christians can integrate faith with their finance, then be sure to subscribe to our channel. Click that link below as well as if you’d like this particular video, be sure to give us a thumbs up and smash that like button. So, Bob, why don’t you get us started on part one today.
Bob:
So we’re gonna start on part one, like we said, of a three part series. It’s gonna be a lot. And it’s called Diversification 101. The three part series, today, we’re going to talk about understanding the different equity and fixed income style charts. Okay? And then next week we’re gonna be talking about understanding the 12 sectors and industries of diversification. Then the last part, part three, is going to be about setting up asset allocation models using all of this information. So, this is a good series for the DIY, the do-it-yourself investor, but at the same time, it also lets our audience know what we go through to build our portfolios that are biblically responsible. Because after you go through all of this, then you have to overlay the biblically responsible part on it, which looks for the positive and takes and takes away the negative.
Shawn:
That’s right. So effectively after going through all three parts of this series, if you’re investing on your own, this will be a really good introduction to everything that goes into the diversification. And if you’re a client of ours, or if you’re someone who after watching some of our videos, you like what we’re doing and you maybe wanna become a client. And either way, it just kind of gives you a little bit of, I guess, kind of peeking under the hood. What are some of the things that we have to go through? And then, like you said, and then on top of that, we also do the faith-based part of it, where as a biblical responsible investing firm, we have to look for those positive and negative screens after we’ve already done all this other stuff.
Bob:
And something exciting. We’re gonna be introducing something very exciting as we talk about this series and we’re calling that…
Shawn:
Well let me go over that. Before we get into part one, we are excited to offer a new service, and it’s gonna allow investors of any size to utilize our biblically responsible investing portfolios. And we’re gonna be calling it Tier Genesis. And this new service, it’s gonna allow our team to offer an all digital process for opening new accounts and intelligent portfolio rebalancing. All of the accounts will be actively managed throughout the year using Biblically responsible investing just as we’ve always done. But this allows us to waive our previous minimum of $100,000 per household, as well as to serve people who are more of a, “Don’t call me, I’ll call you”, the DIY investors of any size. I mean, you might be a larger client and just prefer a system that’s a little more digital. And look, if I need you, I’ll call you. So yeah, we’re very excited about that. If you’d like to learn more about it or you’re ready to get started, just visit tiergenesis.com. All right.
Bob:
I want to ask Garrett, if you’ll put that up on when we say that, put that Tier Genesis up there.
Shawn:
And we’ll have it in description, too. We’ll make sure it’s in the description.
Bob:
Okay. So today, in the first part, we’re gonna talk about the equity style chart and understanding that chart and how that’s used in diversification. And then the fixed income style chart. Now, Garrett’s gonna put it up here for us a diagram of what we use for the equity style chart. It looks like a tic-tac-toe.
Shawn:
Before you go a little further. Just in case. We may have a wide range of viewers and listeners, but…
Bob:
What is equity?
Shawn:
But first, for those of you who aren’t aware, equity would also be another name for, say, stocks and then for your fixed income, that’s typically referred to as bonds. So just kind of depending on where you’re coming from. just wanna make sure we cover that real quick.
Bob:
So as you’re looking at this equity style botch, which is what we’re gonna cover first, you notice that there’s nine different blocks. Like you said, it’s very much like a tic-tac-toe board.
Shawn:
Yeah. Kinda reminds me of that thing too, in school where you do the real basics of what eye color is someone gonna have and how you show the different genes with…
Bob:
I don’t remember that, Shawn
Shawn:
It’s the thing about the dominant versus recessive genes. So, it looks very much like that for anybody, any science nerds on here.
Bob:
So you notice across the top where it says a “value blend and growth”, and that has to do with the style of the stock you’re wanting to go in and a price to earning ratio. Is it trading at a great value or is it a growth stock? The PE ratio, priced to earn ratio, is gonna be higher. So it’s a higher risk, but also could be a lot more growth. So. we’re gonna get into that deeply, but right now we’re just talking about value blend and growth. And then you have, where there’s a large, small, or mid-size company, Shawn, when I first got into the business, the large was three billion and up.
Shawn:
Oh wow.
Bob:
Okay. Now, it’s 10 billion and up. A mid-size company is gonna be between 2 [billion] and 10 [billion], and the small is between 300 million and 2 billion. So, when you’re building a equity portfolio, a stock portfolio, you want to diversify in all of these different blocks.
Shawn:
So for an example, Bob, for the value versus growth, it’ll be a little harder to find one that’s right there in the middle for the blend, off the top of my head. But for a value, you might look at something like – and again, this is not an endorsement of anybody, it’s just big names people might recognize as they’re listening. But you might have a company like Exxon that might be considered more of a value, right?
Bob:
It’s definitely large cap, and it could be and but it depend on where it’s trading at.
Shawn:
It depends. Right, right. I just mean in general. It’s a large company.
Bob:
But it definitely was a value a year and a half ago.
Shawn:
That’s right.
Bob:
But today, the way it’s way up there, it could pop over into that growth, so it can go back and forth.
Shawn:
Well then, yeah, so again, I know it depends, I’m just trying to kind of paint a picture here. So you got the really large company that maybe there’s not a whole lot of growth, but they’re paying consistent dividends. That’s if they’re in that value space.
Bob:
That would be considered large cap value.
Shawn:
And then on the growth side for the most part, Tesla has been very much like a growth, because their PE is really high. And so just as an example, people might recognize the names.
Bob:
That’s good. And this is no endorsement to go buy a Tesla.
Shawn:
Yes. It’s not an endorsement, it’s just, I figured, hey, let’s throw some household names out there that people might recognize.
Bob:
Us, too. We have to deal with compliance, so we wanna make sure that we’re complying with everything.
Shawn:
Not a recommendation.
Bob:
So again, the large cap stocks are those with a $10 billion. That’s with a B. The mid-cap is 2 to 10 [billion]. And the small cap is 300 million. And growth stocks are categorized by their above average increase in revenue and earnings. So they’re growing; they’re in their growth stage.
Shawn:
A lot of your tech stocks would be considered growth.
Bob:
Yeah. That’s true.
Shawn:
Usually it’s stuff coming put of Silicon Valley. It is like, oh, it’s very much growth.
Bob:
Yeah. The PE ratio on these, or price to earning ratio, can be 50, 60, 70 and above. So, it’s a multiple. If you go to any of the financial websites, you can pull it up and you can look at the PE ratio, price to earning ratio. Where on the value side of it, you’re gonna get that PE ratio of like 20 and under, 15 and under. So, it’s trading at a value. It’d be like real estate’s gonna become a good value next year. Well, as we’re making it, this is gonna be coming out in 2023, and I think real estate is really gonna become a good buy if you’re patient.
Shawn:
That’s right. So to compare some of those numbers, your market average for the PE, the price to earnings ratio, typically around like 2025. So that’s why the value at say 15, 10 to 15, it’s gonna be below the market average, and your growth is well above that average.
Bob:
Now, just to get back to that equity style chart, I remember when the Timothy Plan started off as a Christian based mutual fund. All they had was a small cap value fund. That was it, and then they had a bond fund. Well, now they’ve got all these different sectors and actually their largest funds are their large cap value.
Shawn:
It’s actually, as kind of a side note on the Biblically responsible side of things, it’s really encouraging to see that there are more and more options to invest with your values as a Christian. As opposed to like when you first started, it was a lot harder.
Bob:
It was very limited. Very, very limited. Now the blend part, as you see that, that’s going to be something like, just think of the S&P 500, the S&P 500 index fund. That’s going to hang out right in the middle because it’s gonna have your growth. The Fortune 500, it’s gonna have your growth in there, and it’s going to have your value. So there’s your blends, and you can have a blended investment right down the middle of that chart. Then we get to the fixed income style chart. And you can see here how this is broken down is by short term bonds.
Shawn:
This is across the top.
Bob:
Yep. Short term bonds, one to five years, even some that can be three months. Intermediate term bonds and long-term bonds. Now the longer the term of the bond, the better or worse it can do, depending on what interest rates are doing.
Shawn:
That’s right. Depending on which way the interest rates are going.
Bob:
So, long-term bonds have gotten hit very hard this year. I mean, the year 2022 because interest rates have continued to go up.
Shawn:
Right. And if you’re not aware, for those watching and listening, is that when your interest rate goes up, the price of the bonds go down and vice versa, which is why those longer term bonds can be affected more. Because when you have an interest rate environment that’s increasing, which the Fed has definitely been doing a lot of. So it’s gonna obviously make the price, the average price of those longer term bonds, go down more.
Bob:
If you don’t hold them to maturity. So, that’s how the price fluctuates. So think about this, this last year in 2022, interest rates have gone up more than more than 2%. You have a 15 year bond, it’s called bond duration. So, you take 15, multiply that times two. That’s how much those bonds have gone down in value – 30%. Now, if you have a one year bond and interest rates go up by two, it only goes down 2%. Technically. I mean that’s what the math says.
Shawn:
Just a real simple mathematic formula. That’s right.
Bob:
So, you have your short, your intermediate, and your long term, and then you have your high quality, your low quality, we call that high yield, or we don’t call it junk bonds, but it kind of is. But we use the term high yield instead.
Shawn:
Well, high yield sounds better than junk bonds, right?
Bob:
Yeah, it does. It does. So your high quality, that’s gonna be your AAA rated, AA rated type bonds, your very well known companies that are issuing debt.
Shawn:
Or like US treasuries, things like that, right?
Bob:
Because there’s all kinds of different bonds. There’s corporate bonds. There’s municipal bonds. There’s government bonds. There’s school bonds. We’re in an area where it’s growing so fast that there’s been a lot of school bonds issued and it’s backed up by the strength of our county and our city and the taxing strength. So those could be very high rated, good quality, depending on where they are. So there’s bond funds and there’s individual bonds. And bond funds are gonna fluctuate. And you don’t have a lot, you can’t do a lot about it, but if you’re buying the individual bonds and it fluctuates, don’t worry about it.
Shawn:
Exactly. And that’s one thing to think about, especially if you’re listening to this to to do-it-yourself is that if you buy a bond fund, it’s a lot more susceptible to that price fluctuation.
Bob:
That’s correct.
Shawn:
Because there isn’t really a set maturity date because you’re buying a fund that buys bonds, whereas if you do purchase those fixed income positions, those bonds directly, that kind of gives you a little bit more of an advantage because the price will still fluctuate. But if it’s a five year bond, and you just make sure to hold it to maturity, it doesn’t really matter as much that the price fluctuated in between.
Bob:
Now, you’ll be rewarded or you get rewarded for going lower quality. They normally pay a higher interest rate, but there’s also a greater risk of default. Then your mids gonna fall right in there. And then your high quality bonds, they’re gonna have your lowest interest rates, but they’re also gonna have a very low risk default, because they’re, like you say, they’re highly, highly rated. So that gets us to, for today, on part one, as you’ve got your equity style chart, your fixed income style chart. Now, this is just the beginning of this, because then you’ve gotta look at your regions and your countries. You’ve gotta look at the developed countries versus the emerging countries. The developed countries are like Japan, United Kingdom, Canada, Switzerland, France, Australia, Germany, South Korea, Netherlands, and Sweden. We got it right here. And then the emerging markets, even though they’re big, like China’s huge, that’s considered an emerging market, because it’s still emerging – India, Taiwan, Brazil, South Africa, Thailand, Mexico, Indonesia, Malaysia, and Turkey. So you got all these both charts, and then you have all these…
Shawn:
And then on top of that, Bob, like you kind of alluded to earlier, like say on the fixed income side, you not only have the short, intermediate, and long term like for your duration, and then you have your high, medium, and low quality. But then you also have, well, is it government, like federal? Is it other countries, but do you have federal, is it considered municipal? Is it a corporate bond? Is it a school bond? Like, I mean, there’s all those other kind of subcategories to this. But this is just, I guess you’d say, more of a high level.
Bob:
We’re starting with basic, and we’re gonna go deeper. Because next week we’re gonna have part two of understanding the 12 sectors, and all of these sectors go within one of these categories.
Shawn:
That’s right.
Bob:
Yeah. And we’re gonna cover all the sectors like health. I’m not gonna list all 12, but here’s a few: healthcare, communications, technology, consumer staples, energy, real estate, plus many others. And we’re going to not only get into those sectors, but we’re gonna go under each sector or sub-sectors. Like healthcare, there’s gonna be the hospitals, but then there might be biotechnology where technology, there’s all the different types of technology that come into that real estate. It can be industrial real estate, it can be commercial, and it could be residential. So there’s all the different types of real estate.
Shawn:
And then once we’ve gone through all of that, then our part 3 will be covering the building asset allocation models.
Bob:
And you take all this information and put it together. So we’re gonna teach the DIY if they want to go this deep. And if you don’t want to, like we said at the beginning, we’re coming out with our Tier Genesis for the DIY investor that can just go online and open up an account, and all this research and active management is done for you, knowing we’re overweighting or underweighting constantly and looking at what the markets are going.
Shawn:
We trade throughout the year. We’re not day trading, but we trade many times throughout the year.
Bob:
We don’t just buy and holding= sales.
Shawn:
Exactly. Well, thank you so much for joining us. God bless and I hope to see you in part two.
Outro:
We invite you to listen to all of our past episodes, covering many financial topics from a Christian perspective. To make sure you don’t miss any of Bob’s upcoming episodes. You can subscribe to Christian Financial Perspectives on iTunes, Google Podcasts, Spotify, Stitcher, or Amazon Music to learn more about integrating your faith with your finances. Visit Christianfinancialadvisors.com or call (830) 609-6986.
Disclosure:
Investment advisory services offered through Christian Investment Advisors, Inc DBA Christian Financial Advisors also known as Christian Financial Advisors Management Group, a registered investment advisor. Comments from today’s show for informational purposes only, and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 137 – New Year’s Resolutions: How To Make Sure They StickNew Year’s Resolutions: How To Make Sure They StickCheck out these techniques to better help your New Year’s Resolutions “stick”.
More episodes >>
Happy New Year! While new goals and resolutions can be set anytime, there’s just something about a new year and new beginnings that represent change. Bob and Shawn discuss different techniques to better help you achieve your goals throughout the year. These techniques not only apply to financial goals, but also to wellness goals within your own life, whether that be to start an exercise regimen or to spend more time with family.
No matter what your New Year’s resolutions might be – financial or no – it is important to take a step back and examine your life during this time of new beginnings. There are always opportunities for us to improve, but to also track our goals, progress, and resolutions in a healthy and consistent way.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodePHILIPPIANS 4:13I press on toward the goal to win the prize for which God has called me heavenward in Christ Jesus.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
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EPISODE TRANSCRIPTIntro:
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with a biblical worldview. Here’s your Christian Financial Advisors’ host, Bob Barber and his co-host, Shawn Peters.
Shawn:
Welcome to another episode of Christian Financial Perspectives and Happy New Year!
Bob:
2023.
Shawn:
I cannot believe it’s 2023. I I feel like we just recorded our New Year’s episode not that long ago for 2022.
Bob:
How do you think it feels for a guy like me who graduated from high school in 1980, he’s gonna be 43 years this year since I graduated from high school. Makes me feel kind of old, Shawn.
Shawn:
Think Bob’s old.
Bob:
But I’m still going and I’m gonna keep on going and I hope I can do this until I’m like Warren Buffet. I hope I can do it till I’m 90 or something.
Shawn:
At 60, you’re only like, it’s like your midlife, right? Cause you’re gonna live like 120.
Bob:
I hope so. No, I don’t. Really, I don’t wanna live that long. So today, as we always do at the beginning of the year, you know me, I’m really about setting goals.
Shawn:
Yes, I have come to expect that from you.
Bob:
I always have one on setting goals at the beginning of the year because I think it’s never too old to talk about. You need to talk about at least once a year, setting goals. We have the scripture from Philippians 3:14. Go ahead, Shawn.
Shawn:
Philippians 3:14, “I press on toward the goal to win the prize for which God has called me heaven word in Christ Jesus.”
Bob:
So one of the goals that’s very important is their spiritual goal this year. I hope that this year will be a year in which you grow closer to our Lord and Savior Jesus Christ. Maybe time to read that entire Bible again or just make sure you do that devotional every day. And so we are gonna talk about setting goals for this year.
Shawn:
And since this is Christian Financial Perspectives, this is gonna be focused a little more on setting financial goals for the year.
Bob:
That’s right. Well, the first one’s not really financial, but we’re gonna talk about the top 10 year resolutions that people set because at the beginning of the year, it’s always that time to renew, right? I’m in this new year. I’m gonna do it different this year. By the way, these are all my goals right here from last year. Okay. And I’m still working on this year. I’m getting close, but that first one didn’t work out too well for me. But I tried.
Shawn:
So this is a top 10 years resolution people set over and over in order… would you say in order of importance or is more of just an order of how many people typically have this listed?
Bob:
I think this is actually in order of importance, based on my research.
Shawn:
Importance and percentage. So the first one, eat healthier. 37% of people have that one.
Bob:
Got me.
Shawn:
It’s always a good one.
Bob:
Shawn, I’m so southern. I like my sweet tea and my chicken fried steak and my Mexican food. That’s what I’ve been raised on.
Shawn:
Well, Bob if I remember right, though, I think you might have hit the eat healthier, because I’m pretty sure you only put like six spoonfuls of sugar in your tea as opposed to eight.
Bob:
Actually I’ve gotten down to two.
Shawn:
Oh, even better. See, so that is even better. According to eat healthier, one could say that you technically accomplished that one.
Bob:
I’m trying. And then the next one is…
Shawn:
Get more exercise.
Bob:
All of y’all know that one. You know that if you go try to join the gym right now, it’s always packed. January, February, and March starts kind of tapering off. By the time summer gets around, you’re back to the same crew.
Shawn:
Your best time to join the gym is before you get to Christmas or towards the end of January when, unfortunately, a lot of people have already kind of given up on them getting more exercise, you know.
Bob:
We don’t want you to give up this year. We want you to do it every day because I do admit while I’m a little bit heavier here, especially after Christmas, I do exercise every day, but I have a little gym I have at my home, but that is the second one. Third one is save money or save more money. Now, we get to the Christian financial part of it. Okay. That’s 37%. That’s another very, very high one.
Shawn:
And then we’ve got focus on self-care. That’s 24%. It’s just kind of general, maybe it’s not necessarily healthy, getting healthier, getting more exercise, but just take care of yourself.
Bob:
This one’s maybe put the phone down and read more.
Shawn:
Read, like books?
Bob:
It’s a kind of an old-fashioned thing. You get the paper book out. It doesn’t require any batteries or anything.
Shawn:
Well, I’ll admit I usually use the electronic e-reader.
Bob:
We used to call that back in the old days, we called that a Kindle. But now I don’t know if they call it that anymore.
Shawn:
I don’t what they call it. I just didn’t wanna mention any your brand names.
Bob:
Number six.
Shawn:
Learn a new skill.
Bob:
Yeah. Learn something. Do something that that you don’t know how to do.
Shawn:
Maybe learn how to change the light bulb. This’ll be your year.
Bob:
The seventh one is making new friends. I’m too old for that, Shawn.
Shawn:
Oh, come on, Bob. You can still make new friends.
Bob:
It’s down there in the 15% category too, though. It’s not a real high one.
Shawn:
Just see, Bob, now would be a good time to make new friends. They’ll be your friends for the rest of your life, right?
Bob:
How about this one? Number eight, get a job.
Shawn:
Or get a new job.
Bob:
Get a new job. I think I’m gonna stick with what I do. I’ve been doing this so long.
Shawn:
Please don’t you get a new job. More for our listeners. Maybe you’ve been in that job and you realized I really shouldn’t be here anymore. Yeah, it’s okay. Go get a new job. And then the next one, take up a new hobby. That would be a good one. Maybe do something with the house.
Bob:
I probably need to do that. I’m so focused on this financial stuff. I need to do something different. I did play some golf. Okay. So I’m starting to take back up golf again.
Shawn:
I was gonna say you do need another hobby so we can talk about something other than finance.
Bob:
Financial, okay.
Shawn:
I mean, you’re good at that. Just maybe have something else to chat about.
Bob:
Okay. So we’ll talk about it. I grew up playing golf. Actually,, my parents were a member of a country club growing up, and I grew up playing a lot of golf up until I was 15, 16 years old. So when I go out and I start playing golf, the first couple of holes, it is terrible. But usually by about the third or fourth hole, I’m starting to par them. So that was always considered like riding a bike.
Shawn:
Old muscle memory, old muscle memorie’s back. “Oh, I remember this.”
Bob:
Yep. Exactly. It’s kind of like like you say, riding the bike. Once you learn it, you can get those skills back pretty quick. And the 10th one…
Shawn:
Is focus more on relationships.
Bob:
That’s a real important with me, and that’s relationships with your family, with friends, and others. So researchers say about 60% of us actually make our new year resolutions, but only 8% of them are very successful at them. Why is this so.
Shawn:
That’s a huge difference.
Bob:
It is, it is.
Shawn:
Bob, is that 8% of the 60% or is that just 8% of people in general.
Bob:
I don’t know. I think that’s 8% of people in general. I hope it’s not 8%. Cause 8%…
Shawn:
Of 60%, that’s a much smaller number.
Bob:
Eight times, that’d be 4.8. Something like that. No, that’d be 80% of 60%. So 8% would be like 0.04. Something like that. I think, I don’t think…
Shawn:
It’s low. Whatever. It’s low. 8%, 8% of people.
Bob:
So, we’re reminded, every year we talk about this, it’s always good to remind ourselves of it, of the famous Harvard Business School study about goals. And that 83 out of 100 people do not have clearly defined goals.
Shawn:
83 out of 100. And you know what, that kind of makes sense when we’re looking at those top 10 goals that people typically have – eat healthier or get more fit or work on your fitness. That’s a really vague goal too. So, that kind of makes sense. They’re like, well, if your goal is to eat healthier, what does that really even mean?
Bob:
So you need to write it down. Here’s my written down ones. And we’re, we’re gonna talk about how to write those down and we have a little form that we’re gonna give you, too. It’s a goal setting form.
Shawn:
Okay. And for this next one, of the 17 people that did have goals, only three of them actually wrote them down.
Bob:
So get this, 83 out of 100 people don’t have goals, but the 17 that did have them, only 3.
Shawn:
So 3out of 100. So 3 out of a 100 people had written goals.
Bob:
That’s a low, very low number, isn’t it? And when they concluded the study at Harvard, the 3 out of the 10 people that had written goals were earning 10 times the income of the 83 people that didn’t have any written goals. Plus, they tended to be in better health and have happier marriages.
Shawn:
Wow.
Bob:
Because again, one of those goals needs to be a relationship goal.
Shawn:
Yeah, it should.
Bob:
And a health goal. So what’s the first thing, Shawn, that if you want to hit a target, what’s the first thing you have to do? I’m gonna have that bow and arrow and I want to hit that target. Well, or shoot that target?
Shawn:
You need. I think you tricked me the last time we talked about this, but this one is, you need to have a target. Actually, that’s the first thing. So most people think, oh, I need to aim. No, you need to know what the target is. You need to have the target. Did I get it right this year?
Bob:
You got it. You got it perfect. You’re an old hat at this now, you’ve been doing this. So there’s a goal system that I’ve used for years, and it’s called the SMAC, S-M-A-C method.
Shawn:
Please don’t hit me on camera.
Bob:
Okay. So the S in SMAC means…
Shawn:
Specific. So, setting your goals and a target specifically for you personally. Not goals someone else has or wants, but something for you, specific for you.
Bob:
The M in SMAC means measurable. Set goals that you can measure along the way as you’re getting to that goal.
Shawn:
You know a good one for that one? The fitness one is maybe you say, Hey, I wanna lose 10 pounds or something. Well, that’s something that you can actually measure instead of just get fit. It’s like, well, I’m gonna lose 10 pounds, I’m gonna lose 20 pounds or I want to get to a certain body fat percentage. Those are all things that you can measure along the way. And they’re specific.
Bob:
The A in the SMAC is, is achievable. Achievable.
Shawn:
Set realistic goals you can achieve. Bob, you wanna give some examples?
Bob:
Well, I don’t think I should set a goal to run a marathon before the end of the year, but maybe I could set a goal to run a 5k.
Shawn:
Yeah, there you go.
Bob:
Okay. Because that would be unreasonable, especially with torn meniscus in both my knees, bad back, or even just walk five miles.
Shawn:
If you if you join a gym maybe a realistic goal would be like, I go to a CrossFit gym mainly because I used to work out on my own, but I kind of like going somewhere and just doing whatever the coach tells me to do that’s on the board. But wherever you go, if you join a gym, make your goal maybe to start with, I want to change my habits to where I go at least three times a week and just start with that. You can always build if you want to, but like, start with something weird. Like what, three times a week you can do that. That’s something achievable.
Bob:
You wanna curl 30, 40 pounds in each arm, you gotta start off with 5 or 10.
Shawn:
Yeah.
Bob:
And graduate from there. And as you get older, you’re not gonna be doing that heavy weight because your joints are gonna start hurting.
Shawn:
Okay. And so the last letter C, the C in SMAC means compatible. Set goals that are compatible with your values and beliefs.
Bob:
So, as we get into setting the specific goals. I always say that funny, too. My wife says, you sound like you say Pacific versus specific.
Shawn:
Just say it fast and they won’t know. No one will be able to tell, right?
Bob:
Right.
Shawn:
We’ll put specific in the subtitles.
Bob:
But I’ve been very specific over the years, and I set goals in practically every area of my life. This is gonna be on our goals chart that we’re going to give you. And Garrett, if you would put this up as we say these. So, one is a spiritual goal. And that’s, like you say, maybe the read the Bible this year or do devotionals every day to pray with your spouse. That could be a spiritual goal. Okay.
Shawn:
And if you’ve been having a hard time, this is a good example because I know this was one of my goals for 2022. But in 2022, my goal was that, for spiritual, is I wanted to be better and more consistent with my quiet time. There’s a lot of days where I felt like I was kind of giving my last 10% to God, like at the end of the day. And I realized, you know what, I’m gonna, I’m gonna start working out in the mornings, and why not? I can just get up 10-20 minutes earlier than I needed to, to get to the gym so I have some time just me and God, the kids aren’t up. Jenna’s not up. For those of you for spiritual goals, don’t think, oh, I wanna start spending two hours a day in my Bible. If you haven’t been doing that every day, maybe try 10 to 20 minutes a day, spending some time in the Bible. And then when you are consistently doing that every day, maybe you’re able to expand over time. But don’t, same thing, don’t jump into something huge on that spiritual goal.
Bob:
You don’t need to jump into the deep end. Jump into the shallow end, and then swim your way to the deep end. The physical one is the same thing, like you said. That’s a real big one with me, to keep working out. I’ll be 61 in June of this year. I hope to be going another 20, 25 years. Can you imagine how many podcasts we’ll have in 20 years?
Shawn:
Don’t do the math.
Bob:
I know it’d be a lot. I know. It would be, what’s? That’s like a thousand of them or something. But we’re up to 137. I think this is.
Shawn:
Then we have financial ones.
Bob:
And again, baby steps with that. If you’re not saving anything and you say, well, I wanna start saving a thousand dollars a month, that’s going from one extreme to the other. Remember, you need to make it SMAC specific, measurable, achievable, and compatible to you.
Shawn:
And then you have mental.
Bob:
Start off with $25. Okay.
Shawn:
That’s right. And then you start with mental, mental goals. Maybe that could be like from readin , because that is definitely one of the things…
Bob:
Maybe to go back to school.
Shawn:
Yeah. You can go back to school and finish that graduate degree or something or your undergrad if you didn’t finish your undergrad.
Bob:
The relational one. I think this is very important, especially for us guys. We have a tendency to get more focused on work. I am very, very guilty of this.
Shawn:
No, no. There’s no evidence of that, especially in the United States of guys focusing too much on their career and work. What?
Bob:
That relational one, like I’m looking at mine. Have a positive attitude towards Rachael, and travel more with her. By the way, this was 2022. I did that a lot last year. We went and we’re going to, again, this year. We’re going to finally, hopefully, do that Mediterranean cruise she wanted. We had to cancel a couple years ago cause of Covid. And hopefully it’s not gonna show it’s ugly head too bad again this year. Okay. But that’s a relational one that I’m gonna be doing with my wife. But that positive attitude toward her, I can be critical sometimes. And I had that, actually, on here – be less critical about things.
Shawn:
Yeah. That’s good. And you wrote it down.
Bob:
I wrote it down.
Shawn:
That’s helpful.
Bob:
Yep.
Shawn:
So professional. I don’t know, pin on your profession what you might do, maybe going for that professional designation in your career or maybe learning some new skills depending on where you’re working. Or maybe, hey, if you’re working somewhere, a lot of places, especially larger companies, will have like programs and stuff where you can say, all right I want to work my way up to being a shift manager or an assistant manager or something. A lot of times companies will have those paths if you say, Hey, I wanna go further with this. Well maybe talk to HR about it.
Bob:
Just remember to make it SMAC.
Shawn:
That’s right. Exactly. Don’t say I wanna be an owner of the property. You’re like, okay, maybe make baby steps there.
Bob:
So I was thinking about this for myself, Shawn, and it has to do with the program here. It was before the end of the year, be doing videos. That was not an easy task. This was not easy, putting tthese videos all together and the technology behind it and all that, but we did it.
Shawn:
We did. It took about six months longer, but we kept at it. And finally, and as you can tell, here we are.
Bob:
Are one of the things that kept me at it was seeing this every day. Because you know me, I put these around where I’m looking at them all the time. And then, there’s charitable goals. I think it’s very good to think of a charitable goal, what that may be. With me personally, it was supporting more children with Compassion. We’re very strong about Compassion International. But it may be with you, it may be Habitat for Humanity. Just start it. Maybe some of you’re not tithing or giving to your church. Maybe it just has to do with giving more to your church or volunteering at a charity.
Shawn:
It doesn’t have to be money, especially when it comes to charity. And I think that a lot of people kind of forget that. Like I know at our church, we really need more people to help with the youth, with the kids. And so maybe you can’t give money, but hey, maybe once a month you can help with something at your church. That’s great. That’s still helping.
Bob:
So another thing is, I had on my goals here that you can add something to your goals and it’s not gonna be on our little chart that we’re gonna give you, but I have traveled, again, because Rachael loves to travel. Me, I just like staying home on my 17 acres and playing out with my John Deere tractor. But Rachael loves to travel, so put that on my goals.
Shawn:
Put that on my specific family goal.
Bob:
Yeah. A special goal that you might want, like a skill you might wanna learn. I do have a travel goal in there. So, there is the spiritual form, I mean the goals form for you that we would love to share with you. And I just wanna emphasize again the scripture from Philippians, it talks about the goal to win the prize for which God has called you. So remember that behind all these, you need to be within the will of God, I feel within those goals.
Shawn:
And just to reiterate those again. So the goals form, we should have shown it on screen, but we’ll also have it in description.
Bob:
Yeah. We’ll make sure to have it on the screen.
Shawn:
But the ones that you usually recommend and the one that you follow, we have spiritual, physical, financial, relational, mental, professional, and charitable.
Bob:
And I take one and this little form, and you can see it’s real small. I just print this out on a piece of paper, and I laminate it. See how it’s laminated.
Shawn:
Or you can use clear tape.
Bob:
That’s what I do. Actually, that’s what I do.
Shawn:
If you don’t have your lamination machine.
Bob:
I used to have it laminated, but I use clear tape now and I put a copy of this – one in my shower, one on my vanity, one on your visor in your car. If you pull it down, you see it. I got one in my Bible. So I put these all around me where I see them. And as I look back at my 2022 goals, I’ve hit nearly every one of them except the weight.
Shawn:
I think that’s pretty good.
Bob:
Again, I’m gonna try that again this year.
Shawn:
So, so you got 6 outta 7.
Bob:
I think that’s pretty good. There you go. Well, that’s all for today. We hope we’ve helped you. Again, Aappy New Year, and it’s gonna be a great 2023. We look forward to bringing you many educational programs this year from a Christian perspective with Christian Financial Advisors.
Shawn:
And like we said earlier, if you do like this video, please like and subscribe, do all the fun YouTube things. It really does help us out. It also helps, I think, with the algorithm. If you like this, then other users similar to you who might also like Christian financial topics. So, that’s all. Happy New Year and God bless.
Outro:
We invite you to listen to all of our past episodes, covering many financial topics from a Christian perspective. To make sure you don’t miss any of Bob’s upcoming episodes. You can subscribe to Christian Financial Perspectives on iTunes, Google Podcasts, Spotify, Stitcher, or Amazon Music to learn more about integrating your faith with your finances. Visit Christianfinancialadvisors.com or call (830) 609-6986.
Disclosure:
Investment advisory services offered through Christian Investment Advisors, Inc DBA Christian Financial Advisors also known as Christian Financial Advisors Management Group, a registered investment advisor. Comments from today’s show for informational purposes only, and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 136 – What Is The True Meaning Of ChristmasWhat Is The True Meaning Of ChristmasWe discuss the true meaning of Christmas outside of sales and presents.
More episodes >>
We’ve probably all found ourselves caught up in Christmas sales, the need to find perfect gifts, and all the stress that comes along with this holiday. What used to be a time of celebration, joy, and giving has slowly turned into a holiday of big businesses making sales quotas. No longer is Christmas the joyous occasion that it used to be.
We present statistics on just how money driven Christmas has become, and also present what Christmas time should truly be about. It’s jaw dropping the average amount an American household spends on Christmas! Instead of focusing on all of the gifts and decorations, sometimes it is good to take a step back and refocus on what Christmas is truly about.
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodePROVERBS 22:7The rich rules over the poor, and the borrower is the slave of the lender.
MATTHEW 6:19-21Do not lay up for yourselves treasures on earth, where moth and rust destroy and where thieves break in and steal, but lay up for yourselves treasures in heaven, where neither moth nor rust destroys and where thieves do not break in and steal. For where your treasure is, there your heart will be also.
LUKE 12:34For where your treasure is, there will your heart be also.
MATTHEW 6:24No one can serve two masters, for either he will hate the one and love the other, or he will be devoted to the one and despise the other. You cannot serve God and money.
ISAIH 7:14Therefore the Lord Himself will give you a sign. Behold, the virgin shall conceive and bear a son, and shall call His name Immanuel.
JOHN 3:16For God so loved the world, that He gave His only Son, that whoever believes in Him should not perish but have eternal life.
JOHN 14:6Jesus said to him, “I am the way, and the truth, and the life. No one comes to the Father except through me.”
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTIntro:
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with a biblical worldview. Here’s your Christian Financial Advisors’ host, Bob Barber and his co-host, Shawn Peters.
Shawn:
Welcome to another episode of Christian Financial Perspectives. We’re so glad you joined us. if you’re watching us right now on YouTube, don’t forget to like and subscribe to the channel. And before we get started, Bob, you ready for Christmas?
Bob:
Well, you know the answer to that.
Shawn:
Oh, no. Wait, wait. We still got a few more days for Christmas.
Bob:
We got another three or four days.
Shawn:
Right. So you’re not gonna go to the local pharmacy corner store for at least, what, two or three more days?
Bob:
Yeah And I love to do it because all of us, I meet all my friends. It’s all of us guys and we’re usually walking around with our heads in the cloud like this. Like, what are you gonna get? I don’t know. And we just start grabbing stuff and the kids love it because they just…
Shawn:
It’s almost always some sort of, there’s chocolate and some sort of like salty snacks and…
Bob:
There’s a lot of gum in there, a lot of gum. Like little bitty toys like this big I’ll get, you know? Oh yeah. It’s funny.
Shawn:
Yeah. But you buy like the whole store and spend 20 bucks.
Bob:
You know what, I got this tradition from my dad, and my dad would do that. So, it’s kind of a tradition.
Shawn:
Well, I mean, between you and Rachael though, I mean, you’re always prepared, if you will.
Bob:
Oh, Rachael prepared 5 weeks ago.
Shawn:
Your stuff is more of it’s just fun to do it like last minute.
Bob:
So today we’re gonna talk about?
Shawn:
Well, we’re gonna be talking about the real meaning of Christmas. Now, before we get into that, though. All right. I just wanted to cover, so we’re gonna be going over the big business of Christmas and then the real meaning of Christmas.
Bob:
The big business of Christmas. You think Christmas is big business?
Shawn:
Well, we’re gonna cover that a little bit.
Bob:
I know you did a lot of studying on this, didn’t you?
Shawn:
I did. I did a little bit. Well, considering this is Christian Financial Perspectives, I figured we should probably have a little bit of financial in here.
Bob:
You’re gonna give us some financial stats that go with Christmas. It’s mind blowing. It really is.
Shawn:
So this is coming be more from the retail side. Which there’s a lot of statistics on it. So between Thanksgiving and Christmas, US, because this is just the US. I don’t know about the other countries. But for the US, retail sales reached $889 billion in 2021. That’s right. $889 billion, billion with a B. B as in Bravo, or as in a lot of money – in 2021 and are expected to reach $942 billion this year in 2022. We’re obviously through quite a bit of it already.
Bob:
I wonder how much of that – do you have stats on how much this is going on credit cards?
Shawn:
Well, we’re gonna gonna get a little bit into like how much people spend. But, but yeah. Just in the last couple months, Bob, we’ve been seeing some of the stats coming out about how much just normal life, like how much the average credit card debt, has been going up for per household.
Bob:
It’s gone way, way up because of way of inflation. People didn’t quit spending money. They just put it on the card and just kept going.
Shawn:
And then it adds up. I mean, like the Bible says, “Little by little,” right?
Bob:
Yep.
Shawn:
So, those are just some of those initial stats. The top end estimate though, Bob, for 2022 is $960 billion. Right. 960. Now, here’s what gets even crazier. Compare that with 2012 numbers.
Bob:
10 years ago.
Shawn:
10 years ago. $567 billion. We’re up over 66% in just 10 years. That is a lot of Christmas shopping, right?
Bob:
I would think the retail stores really push it and we see how they push it.
Shawn:
No, I’ve got some interesting data on here too of how much Christmas accounts for in retail. So, to break this down a little further, think about the following few stats we have, but I have a few stats.
Bob:
Wait a second. Before you go into this. I don’t want my wife hearing this because if she hears this top number, you’re gonna give, we don’t spend that much. She’ll say, well, that’s the average household.
Shawn:
Yeah. Well.
Bob:
Okay. Go ahead.
Shawn:
Take with that what you will. But Rachael, I hope you do watch this, because we put a lot of work into this. We’ve put a lot of work in these episodes. All right. Think about this from the 2022 holiday season, which is almost over. They call it the holiday season because it kind of starts a little bit before Thanksgiving, to an extent.
Bob:
Now it does.
Shawn:
Yeah. And for sure Black Friday and then it goes through Christmas and you’ve got your people shopping on the 24th. So anyway, US households will spend an average of 7250 – $7,250 during the holidays.
Bob:
I don’t think we’ve ever spent that much.
Shawn:
No, but that’s the average.
Bob:
That’s the average?
Shawn:
That’s the average.
Bob:
So a lot of people spend more than that?
Shawn:
Well, So, the way I came up with that number, because I couldn’t find specific stats on the actual average. Like I’d seen some averages from like a number of years ago. But I wanted something more current. So what we did is we just took, well if the estimate – the $942 billion, you divide that by the total number of households in the US, you get $7,250.
Bob:
You think they’re taking some of my neighbors I was telling you about that are spending $5000 to $25,000 just on lights?
Shawn:
Bob, they might be watching this. Don’t call them out on the lights.
Bob:
And having professionally installed lights. I wonder if that goes into that number. Yeah, that’s crazy. $7,250. Wow.
Shawn:
And see it’s funny though, too.
Bob:
That’s per household.
Shawn:
That’s what the…
Bob:
I know y’all don’t spend that much.
Shawn:
No, we don’t. But you take that $942 billion and if that’s the spending, you just divide that into the number of households.
Bob:
Well, that’s what’s interesting is how so many of these people are spending more than that. Of course, a lot of people are spending less, too. But still, that’s a lot.
Shawn:
So, another one, holiday shopping accounts for 30% of annual retail sales.
Bob:
Well, I don’t doubt that one.
Shawn:
30% of the annual sales are just like Christmas shopping, basically. Another one, from December 15th to the 24th accounts for 40% of all Christmas sales.
Bob:
I know that one. Cause I do that, on the 24th.
Shawn:
But think about that. So 30% of the annual sales occurs during this short window of time. And 40% of that is just from the 15th to the 24th.
Bob:
Hopefully, it helps some of y’all cuz we’re doing the program two or three days before. So maybe we’ll save you some of that.
Shawn:
So if you are, if you haven’t finished your shopping yet, you’re just helping to contribute to that 40%
Bob:
Now this is an interesting one, this next one. Go ahead. I’ve got to comment on this one.
Shawn:
56% of all shoppers buy gift cards.
Bob:
I wish you looked that up because I’ve heard some crazy percentage number of the gift cards that a lot of them never spend it.
Shawn:
That’s right.
Bob:
There’s unspent money on those gift cards.
Shawn:
And certain gift cards also have expiration. So what what will happen is, is you get a gift card and not only does it expire after a certain period of time if you didn’t use it, but some cards even have, I think this is like the more like the credit card debit card, like the Visa, MasterCard, stuff like that, where there’s a charge, basically like a finance charge per year. So even if it technically didn’t expire, depending on how much was added onto it, if you waited long enough, it’ll literally just go to zero from finance charges each year.
Bob:
I mean, it’s a profit making deal.
Shawn:
It’s a profit making deal. But the other thing too, just as an aside, it’s kind of sad to me that we’re at well over 50% of gifts are just a gift card. Because effectively, if you get the gift card, it’s like, well, I think maybe they might go eat or go to this restaurant or whatever. And you’re not even really, at that point, giving a gift. Like, isn’t the whole point, like at its core of when you’re giving a gift to someone, it’s like, Hey, I thought about this. Like, I wanted something that would be meaningful to you, and you buy a gift card. It kind of feels like just an easy way out of, “Oh, I checked the box to give a gift.”
Bob:
You can tell everyone because we don’t have this rehearsed in advance or anything. You know what my favorite gift is, because tell them. Go ahead.
Shawn:
It’s the stuff my wife always gets you, this basket with all your favorite snacks.
Bob:
Exactly. Which is coconut.
Shawn:
For anyone who wants to send us a gift.
Bob:
Coconut chips, coconut drinks. You name it. It’s got coconut in it. I love it.
Shawn:
So if you’re sending anything to Bob as a thank you for the show, make sure it’s got coconut in it.
Bob:
Hey, maybe we’ll get some coconut gifts now. All right.
Shawn:
So, and the last stat I wanted to share on just this retail side of it, the top five items people plan to buy for themselves as a Christmas gift for yourself, Alcoholic and non-alcoholic beverages. So drinks – 33%. Food, including like meal prep kits, 30%. Clothing, 30%. Shoes, 23% and books, 17%. I don’t know, just thought it was interesting.
Bob:
Shawn, I think about all this big business, and it’s gotta be stressfu.
Shawn:
A little bit. Yeah, yeah.
Bob:
Because all this debt that you’re accrue, a lot of this is debt, as you know, especially this year because credit cards are maxed out and you’re just putting more and more on them, and there is that stress.
Shawn:
Yeah. So the stress of the Christmas shopping. So, I wanted to share a little bit of information like from the American Psychological Association and some surveys that they’ve done, and just that information about the stress. Because you obviously have the money side, the retail side of it, but then there’s the actual mental stress of this. Almost three quarters of Americans report that money and work are significant sources of stress in their lives. And this according to the American Psychological Associations, a 2007 Stress In America survey. The holidays, anything between Thanksgiving and Christmas. Then compound the pressure as revealed in the APAs 2006 poll on holiday stress. Now, middle income Americans are particularly affected as the everyday financial pressures are amplified by demands to spend more. And now, inflation.
Bob:
It’s demand, you gotta spend more if you love me. Come on, spend more. That’s what America’s about. Right? Consumerism.
Shawn:
I know it’s sad. And then with inflation, this has just gotten even worse. Because now, just to do the same as last year, you’re not even outdoing last year, but just to do the same as last year and now you’re gonna spend even more. So, with the pressure to create the perfect holiday, so whether that’s a memorable meal, expensive gifts, elaborate decorations, and more like…
Bob:
Okay, let me expand on that. So you know us, we watch Hallmark every night. And I’m looking at all these decorations, I’m going, my house does not look like these houses. Wait a second. They’re professionally done. That’s a movie set. But all those decorations, again, I was telling you about…
Shawn:
Wait, Bob, are you, are you saying that sometimes Hollywood, even Hallmark Channel, doesn’t portray life as accurate as it typically is? Like, is there a little bit of Hollywood magic going on there?
Bob:
All perfect.
Shawn:
Oh, okay. All right. Well whether it’s those elaborate decorations or more, just not having enough money to do it all causes stress to more than 60% of those surveyed for holiday stress. So like, just everything about that feeling like I can’t do enough. Like, I’m not gonna be able to make the perfect holiday, just drastically increases the stress that people go through. And then, the worries continue even more when the credit card bills arrive a month later.
Bob:
Oh yeah.
Shawn:
Because you’re going through all this spending and it’s just really easy to, “Oh, buy this and buy this and oh, it’s on sale!” But remember, you’re still paying something, even if it’s on sale, you’re still spending money. So, make sure you’ve got a budget. Like that would be the one thing to help with the stress. Because like, you can’t avoid gifts at all.
Bob:
Yeah, that’s right.
Shawn:
But at least make sure like you stick to a budget that you can manage.
Bob:
Like what my old buddy Dave Ramsey always says you can get in debt in just a matter of days, but it can take you years to get out.
Shawn:
Oh, that’s right.
Bob:
And you think about, like, we go back to those stats that you were sharing earlier, that the majority of this shopping happens just a couple weeks before. So you’re pushing those credit cards way up just over two weeks and then it might be the next 12 months that it’s gonna take you to pay them off. How many, this is kind of a hard question I want to ask in all this, but I gotta admit even myself, Shawn, if I sat down and tried to list out 10 of the things I got last year, it’d be very hard. I don’t think most people could remember even 10 of them. Maybe two or three. And you always say, I always remember when Jenna, she knows what I love and gets me my food basket. That’s something I remember every single year. I start thinking, and I can’t really remember what else I got last Christmas. I think Rachael got me one of those little, what is it called, planes that go up in the air and take a picture.
Shawn:
A little drone.
Bob:
But I’ve not used it. See? I still gotta learn how to use it. I’m waiting for you to show me how to use that thing.
Shawn:
All right. Well, we’ll have to take a look at that later.
Bob:
I think that was a Christmas present, but I can’t remember. Can you? Could you list them? I gotta ask you, those listening to us, could you list 10 other things that you got last year right now? Could you sit down with a piece of notebook paper and write down 10. I bet you couldn’t.
Shawn:
I think the point here, though, is not to make someone feel bad about giving.
Bob:
Not at all.
Shawn:
But if anything, when you’re thinking about the stress of shopping for people for during Christmas, just remember that like Bob was saying, it’s not that important what you actually get. You’ve probably heard that before. It’s the thought that counts.
Bob:
Oh yeah. Right.
Shawn:
It’s not as much what you actually got. It’s the thought that went into it. You showed someone that you cared.
Bob:
Don’t hear that term very often anymore. It’s the thought that counts.
Shawn:
That’s right.
Bob:
Because it does. When there’s thought put into it, it’s more meaningful. There’s no doubt about that.
Shawn:
So now, I wanna share some scriptures with our viewers and listeners of what God’s word says about money and priorities, which I think is a good time to share this. So we’re gonna start with Proverbs 22:7, “The rich rules over the poor and the borrower is slaved to the lender.”
Bob:
Hmm.
Shawn:
That’s a good one to think about with trying not to get the credit card debt up too high.
Bob:
Yeah. Yeah, it is.
Shawn:
Bob, if you wanna get the next one.
Bob:
Matthew 6:19-21, “Do not lay up for yourselves treasures on earth where moth and rust destroy and where thieves break in and steal, but lay up yourselves treasures in heaven where neither moth nor rust destroys and where thieves do not break in and steal, for where your treasure is there, your heart will be also.”
Shawn:
Yeah. I feel like that’s a good one, too, with the where your treasure is, there your heart will be also. If you’re focused on what you’re getting people for the sake of like, it needs to be perfect, it needs to be great. Well, then you’re kind of missing the point of like, you’re wanting to show someone that you care. You’re wanting to show someone that you love them. And so, it should be more about like why you’re doing it, not what you actually spent.
Bob:
Yes, exactly.
Shawn:
So for the next one, Luke 12:34, “For where your treasure is, there will your heart be also.”
Bob:
Matthew 6:24, “No one can serve two masters, for either he will hate the one and love the other, or he’ll be devoted to one and despise the other. You cannot serve both God and money.”
Shawn:
That’s right.
Bob:
Okay. So, we’re gonna really get into now what we feel is the real meaning of Christmas.
Shawn:
That’s right. And whether you’re watching or listening to this episode, we want you to feel hope this Christmas season. We don’t want you to feel hopeless. Some of you may be stressed about Christmas coming up because maybe you feel like you didn’t get enough gifts. that whole thing about the perfect making the perfect Christmas. Maybe you feel like you didn’t get enough gifts for your family, or you didn’t get the right gifts. They weren’t the right ones. Maybe you’re stressed from spending too much money on the gifts, and you’re worried about the budget. You’re worried about that credit card bill coming due. Regardless of why you’re stressed, because it also might be just stressed about all the family coming into town.
Bob:
Could be.
Shawn:
But regardless of why you’re stressed, take comfort in knowing Christmas isn’t just about the gifts, it’s about celebrating the coming of Jesus to earth to save us.
Bob:
That’s correct.
Shawn:
So that takes us into the real meaning of Christmas.
Bob:
Isaiah 7:14 says, “Therefore the Lord himself gave you a sign. Behold the virgin shall conceive and bear a son, and they shall call his name Emmanuel.”
Shawn:
And just remember, as we’re going through these scriptures and you’re thinking about kind of how this Christmas has gone for you, since we’re not quite to Christmas yet, that you can still focus, like you still have time, you can still focus on what’s really important this Christmas with your family, even if you fell into the trap of the big business of Christmas. And to help you with this, we’re gonna highlight a few things to remember in addition to these scriptures. And hopefully this will help you not just for this Christmas, but for next year, too. So, our next scripture is John 3:16. Some of our Christian listeners might know this one, but John 3:16,”For God so loved the world that he gave his only son that whosoever believes in him should not perish, but have eternal life.”
Bob:
And John 14:6, you go ahead and read that one.
Shawn:
“Jesus said to him, ‘I am the way and the truth and the life. No one comes to the Father, father except through me.'”
Bob:
So I put together 10 meanings of the true meaning of Christmas, and this is what it means to me. I hope it means the same thing to you, Shawn, and to those that who are listening. The number one thing that I think is the true meaning of Christmas is this is about the immaculate conception and virgin birth of God’s one and only Son. I was just, this morning, as I was thinking about this, about the immaculate conception that this is the only person has ever been born on this earth that was not from the seat of man. But it was from God and and this was a virgin birth of purity.
Shawn:
Yeah. It’s just amazing thinking about like, there’s that part and just from that point forward, all of the promises and the prophecies that were made that God fulfilled and for, I mean, you think about, what was it? I think it was 400 years of silence from the time of the last prophet until Jesus, or the angel comes to Elizabeth right before Mary. So, until that angel showed up.
Bob:
Because John was coming.
Shawn:
Exactly. And before that angel, there was 400 years of silence. And you’ve gotta imagine, like if you’re one of the Jewish people thinking, well, God, you made all these promises, where are you? Where are you? Like, what’s going on? We haven’t heard anything from you. And God’s timing is not our own. But when he says, I will do something, he is faithful to do that. And that is what’s so amazing. Like when Jesus was born, it just started this whole cascade effect of remember all those promises I made to you? I’m fulfilling them. Now, here’s my son.
Bob:
That was the first miracle in immaculate conception.
Shawn:
The second one. It’s about unconditional love for all of us, no matter where we are in life.
Bob:
He came for every one of us. That’s right.
Shawn:
That’s right. Whether you’re a king or the blind beggar in the street.
Bob:
It’s about the worship of the King of Kings. The wise men came thousands of miles and could see the universe lining up to shoot that bright light in that star and shepherds on that glorious night.
Shawn:
Yeah.
Bob:
They came to worship the King of Kings in a barn amongst smelly animals because man, even from that point, was trying to reject.
Shawn:
That’s right.
Bob:
So God being born. We can still accept that today.
Shawn:
And it’s about the Holy Angels rejoicing, announcing the birth of Jesus to the shepherds.
Bob:
It’s about purity and holiness is truly what this day is about, the purity and holiness of God and of Jesus Christ.
Shawn:
It’s about Jesus being born humbly in a manger around a bunch of stinky animals so Jesus could relate to everyone no matter the social hierarchy.
Bob:
He didn’t come for the wealthy. He didn’t come just for the poor. He came for both the wealthy and the poor. He came for everyone. It’s about bringing forth the fruits of the Holy Spirit. It’s about love and joy, peace, patience, kindness and gentleness all in one, one person.
Shawn:
It’s about giving them meaning and purpose to this life.
Bob:
It is.Without Christ, I cannot imagine living life without Christ walking beside me. It’s about the Trinity. It’s the Father, it’s the Son, and the Holy Spirit, three in one.
Shawn:
That’s right. And finally, it’s about the free offer of a real and meaningful life here on earth with purpose, meaning, and eternal life with the maker of our universe simply by acknowledging and accepting His one and only son Jesus Christ as your personal Lord and Savior.
Bob:
Amen. That’s what we feel the meaning of Christmas is. And while the lights and the snow and the beautiful trees, the food and the cookies, definitely, the Christmas movies are all good. But the real meaning of Christmas is about God coming to live amongst us through his immaculate conception of a virgin birth conceived by the Holy Spirit. So, Merry Christmas from all of us at Christian Financial Advisors.
Shawn:
Merry Christmas and thank you for joining us.
Outro:
We invite you to listen to all of our past episodes, covering many financial topics from a Christian perspective. To make sure you don’t miss any of Bob’s upcoming episodes. You can subscribe to Christian Financial Perspectives on iTunes, Google Podcasts, Spotify, Stitcher, or Amazon Music to learn more about integrating your faith with your finances. Visit Christianfinancialadvisors.com or call (830) 609-6986.
Disclosure:
Investment advisory services offered through Christian Investment Advisors, Inc DBA Christian Financial Advisors also known as Christian Financial Advisors Management Group, a registered investment advisor. Comments from today’s show for informational purposes only, and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 135 – The #1 Reason Behind Financial SuccessThe #1 Reason Behind Financial SuccessFinancial success might just come down to these 2 words.
More episodes >>
Financial success is not just making a lot of money, but more importantly, it is WHAT you do with the money you make. Are you investing it correctly and diversely? Is your family prepared financially if something were to happen to you? Do you have money set aside for the future in case of a financial disaster like a loss of a job or disability? All of these and more are key to being financially successful and prepared.
So, what two words can easily sum up financial success? Bob and Shawn discuss what most financially successful individuals do in order to invest wisely, save consistently, NOT procrastinate, and have a financial plan in place. Listen in to discover the key reason behind financial success!
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodePROVERBS 1:1-7The Proverbs of Solomon, son of David, King of Israel: for gaining wisdom and instruction; for understanding words of insight; for receiving instruction in prudent behavior, doing what is right and just and fair; for giving prudence to those who are simple, knowledge and discretion to the young – let the wise listen and add to their learning, and let the discerning get guidance – for understanding proverbs and parables, the sayings and riddles of the wise. The fear of the Lord is the beginning of knowledge, but fools despise wisdom and instruction.
PROVERBS 2:6For the Lord gives wisdom; from his mouth come knowledge and understanding.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTIntro:
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with a biblical worldview. Here’s your Christian Financial Advisors’ host, Bob Barber and his co-host, Shawn Peters.
Shawn:
Welcome to another episode of Christian Financial Perspectives. We’re so glad you joined us today, whether that’s on video or listening via audio. Bob, what do you got for us today?
Bob:
Well, I have a lot better subject today than I did last week. Last week was the number one reason for financial failure, and that’s not ever fun to talk about. I don’t like talking about that, but we needed to. But today we’re gonna talk about the number one reason for financial success.
Shawn:
I guess we could just say this is part two of the number one reason behind financial failure and success.
Bob:
Hey, that’s pretty good. I like that. Maybe we could have all done that at one time, except it would’ve been an hour.
Shawn:
It would’ve been a long program.
Bob:
Yeah. So last week we covered the number one reason for financial failure in detail, which is procrastination.
Shawn:
Oh, I forgot to look it up ahead of time. I thought I’d have time before this. Procrastination. I know it.
Bob:
You know, and the things that people will procrastinate on, we talked about that last week, and they’ll procrastinate. The first one’s a really big one. We’re not gonna go all over them again. We’re just gonna touch on them. It’s getting their estate plan done.
Shawn:
That’s right. This is just one thing after another. It’s just one thing after another.
Bob:
Can’t ever get around to that. You know, Christmas is coming and after Christmas I’ve got the next thing, then it’s taxes, then the kids on vacation. It’s always something.
Shawn:
And all of a sudden it’s Christmas again.
Bob:
Yeah. Exactly. Keeps going.
Shawn:
So the second one. Saving and investing early enough and consistently.
Bob:
The key is early.
Shawn:
Yeah. Exactly.
Bob:
And one I’ve seen unfortunately, with those that are left behind, it’s not having enough life insurance for the younger breadwinner when they have children.
Shawn:
That’s right.
Bob:
I want you to have lots of life insurance.
Shawn:
Jenna has enough. Jenna’s got enough to take care of her.
Bob:
Enough? I want you to have enough in case of something were to happen to you.
Shawn:
Yeah, no. That’s…
Bob:
Who do I make the program with?
Shawn:
I mean, I guess you’d find somebody, but see, the key is, Bob, that at least this is what I remember when I was going through the whole life insurance thing, is you want enough to make sure you take care of the family, but you don’t wanna be tempting.
Bob:
Exactly.
Shawn:
Don’t want Jenna to look at that going, “Well, he’ll be with the Lord.”
Bob:
Yep. Exactly. You don’t, you act up. You’re outta here. So if you’ve not seen last week’s program, we would definitely advise you, recommend you go back and see it. All right. So today, let’s cover the number one reason for financial…
Shawn:
Success.
Bob:
Success. But you know, first I think it’s important that we look at what financial success looks like.
Shawn:
That’s right. I’m sure everybody thinks of something different, but we’re gonna cover some areas that we feel are applicable to pretty much everybody.
Bob:
Yeah.
Shawn:
So number number one, a 65 to 70 year old can retire because they started saving and investing early in life and didn’t procrastinate. So, that’s one example.
Bob:
It’s that word again from last week.
Shawn:
So, don’t procrastinate. That helps.
Bob:
And I tell you, when I meet these 65 or 70 year olds, or even 60 year olds when they come in, and you’d be surprised, I mean, the majority of ’em have over a million dollars. You, but they started 30, 35 years ago. And they were just so consistent in how they did it. They weren’t trying to get rich quick.
Shawn:
It’s that consistency.
Bob:
It was that scriptural principle who saves little by little makes it grow.
Shawn:
That’s right.
Bob:
The second one I think of with financial success is when an unexpected expense comes along, like a major repair, your air conditioner breaks. You need a new car, or even you lose your job, or maybe a health emergency comes along and you have enough in…
Shawn:
Cash reserves.
Bob:
Cash reserves to cover it. That is so important. That’s something a lot of people fail to do, is to build their cash reserves. You know, Shawn, I even noticed that a lot of people, they’ll, build up their 401k, but then they forget to build the cash reserves.
Shawn:
That’s right.
Bob:
So I recommend doing both at the same time. Not one or the other.
Shawn:
That’s right. All right. And when it comes to like your individual IRA or things like that, maybe you do outside of your work plan. You know, it’s one of the things that when people come in and maybe they sold a home recently and they downsize. and they say, oh, I’ve got $200,000 left over that I can invest. And the first question I always ask is, great. Well, how much do you have in your cash reserves? It’s crazy, in my short time compared to yours, how many times it’s happened where they don’t have cash reserves or it’s very, very little. It’s like, okay, well then you don’t necessarily have 200k, maybe you’ve got 150k. Like, but you need to look at your expenses. That’s just one of those things, like we said, if you have everything in an IRA and everything in a 401k and you have that unexpected expense come along, you’re not gonna be in a good spot.
Bob:
Especially, it’s crazy to have cash reserves right now if you’re in this bear market. Investments are not considered cash reserves. It’s a complete separate thing. You know, this other one is kind of a ironic thing. It’s kind of a flip on what success is because it’s not success when somebody unexpectedly dies.
Shawn:
But it’s when someone unexpectedly dies and they have their estate plans in order.
Bob:
Yeah. That’s a nice thing. I see it more times than not that their estate plan is not in order, you know? So think of that as financial success to get your estate plan and don’t pro…
Shawn:
Procrastinate. Don’t procrastinate. So number four, a breadwinner unexpectedly dies and has enough life insurance to financially care for the family in their absence.
Bob:
Fortunately, we’ve had some of these too. I mean we just did a life insurance analysis yesterday. Austin and I were doing one and for a breadwinner 42 years old. Let me see. They make about $105,000 a year. And they had, I think, it was about $120,000 saved up in their 401ks and different savings. And when the life insurance analysis came out, we thought we were reading the numbers wrong. You know what it said that person needed if they were to die next year? 1.8 million in life insurance.
Shawn:
And how much did they have in life insurance?
Bob:
About $100,000.
Shawn:
So they’re a little low.
Bob:
They’re a little low. Yeah. But then again, I’ve seen where there had been unexpected deaths where the breadwinner did have a million and a half. And it really took the pressure off for the remaining spouse.
Shawn:
And one of the things, too, I think would be good for our viewers, listeners, when you talk about life insurance, it’s far more important earlier in your career, earlier in your life. Because typically, your 20 something and 30 something year old isn’t gonna have a whole lot of investment stake. It’s just not very common. I mean, and maybe if you went to law school or are a doctor and you graduated early and maybe you could build up really quick, but for most people, they don’t have a lot for investments. So, having that larger life insurance, even if it’s a 20, 30 year term, super cheap in your twenties and thirties. But that helps while you have time, cuz you’re, of course, diligently saving and investing during this time that you kind of help cover that difference. So then as you get older, you don’t need the life insurance as much because you’ve been able to build up your assets.
Bob:
I tell you what I’m gonna do, and Garrett, I want you to remind me of this. I’m going to put together a chart that we can put up when we’re showing this. Because really, your life insurance is up here when you first start, and then it goes down.
Shawn:
That’s exactly what I was thinking.
Bob:
And savings is going up and I’ll show a chart. That’s one of the reasons behind buying term and investing the rest, which was a really big deal about 30 years ago when that came out, because it used to just be whole life life insurance.
Shawn:
Which is incredibly expensive. But if you buy that longer term when you’re younger, and then like you said, you invest the rest, that makes a big difference. So as that life insurance is getting closer to expiring, you’re slowly building up your assets.
Bob:
Yeah. And that chart will really put this in perspective. And one of the last things I looked at, but there’s so many other ways of looking at these five.
Shawn:
These are really just five. We figured these were a good, broad overview.
Bob:
And I’ve seen this personally in our family when my wife got cancer and we had disability insurance coverage, and she could no longer work. And we had that disability coverage that covered her salary while she was getting her cancer treatment.
Shawn:
That’s right.
Bob:
Now, we’ll say, we’re heading towards five years of being cancer free now. So, we’re really excited about that. People ask all the time how Rachael’s doing and she’s doing really, really well. So, I’m glad that we’re fortunate and very happy to say that. Some of the things financially successful people do are they do not…
Shawn:
Procrastinate.
Bob:
I know we’ve said it a lot, and they save…
Shawn:
Consistently.
Bob:
Yeah. They invest wisely and diversify.
Shawn:
They know where their money is going and they track it.
Bob:
Yeah. Budgeting.
Shawn:
Okay. They can give and help others in need.
Bob:
I think that’s very important.
Shawn:
It is.
Bob:
They have a good financial plan in place that is so important. We’ll help put that together for you as a fiduciary based advisor.
Shawn:
They also try to educate themselves about how money works.
Bob:
And if you watch this program every week, you would definitely get educated. I think this, well, we say what, which podcast episode is this? 135?
Shawn:
135. Should be.
Bob:
Yeah. 135 episodes. So, if you haven’t listened to all 135, go do it.
Shawn:
Maybe just little by little.
Bob:
Yeah, yeah. There you go. Little by little. Don’t have this, you know, they do that with Netflix. Like you watch an entire…
Shawn:
You don’t need to binge watch our podcast episodes.
Bob:
Don’t binge watch. It will bring brain damage to you, too much overload.
Shawn:
Then the last one is seeks wise counsel and advice.
Bob:
So the number one reason for financial failure is…
Shawn:
Procrastination.
Bob:
The number one reason behind financial success is…
Shawn:
Wisdom and knowledge.
Bob:
Wisdom and knowledge. Shawn, if you’ll read that first chapter of Proverbs. It’s not really long, but I love that first chapter. It talks about that.
Shawn:
Will do. Proverbs 1:1.
Bob:
The whole chapter.
Shawn:
Exactly. “The Proverbs of Solomon, son of David, King of Israel: for gaining wisdom and instruction; for understanding words of insight; for receiving instruction in prudent behavior, doing what is right and just and fair; for giving prudence to those who are simple, knowledge and discretion to the young – let the wise listen and add to their learning, and let the discerning get guidance – for understanding proverbs and parables, the sayings and riddles of the wise. The fear of the Lord is the beginning of knowledge, but fools despise wisdom and instruction.”
Bob:
So smart people don’t despise it.
Shawn:
That’s right.
Bob:
They like that wisdom and instruction. Proverbs 2:6 says, “For the Lord gives wisdom and from his mouth comes knowledge and understanding.” You know, we want to help you be financially successful and we wanna come alongside you in this journey in life. Christian Financial Advisors, we are a fiduciary based advisor, which is so important because we work for you. We’re only paid by you. We’re never paid any commissions, so we have no conflict of interest. There’s not any trails paid to us. There’s no corporate giant pushing us to sell certain product or a certain stock or a certain mutual fund. Our interest is your interest, and this is to help you be financially successful. So you wanna talk about it, visit us on our website www.christianfinancialadvisors.com or text or call us during in business hours, Central Time, at (830) 609-6986.
Shawn:
Thank you for joining us and God bless.
Outro:
We invite you to listen to all of our past episodes, covering many financial topics from a Christian perspective. To make sure you don’t miss any of Bob’s upcoming episodes. You can subscribe to Christian Financial Perspectives on iTunes, Google Podcasts, Spotify, Stitcher, or Amazon Music to learn more about integrating your faith with your finances. Visit www.Christianfinancialadvisors.com or call (830) 609-6986.
Disclosure:
Investment advisory services offered through Christian Investment Advisors, Inc DBA Christian Financial Advisors also known as Christian Financial Advisors Management Group, a registered investment advisor. Comments from today’s show for informational purposes only, and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Click below to listen to Episode 134 – The #1 Reason For Financial Failure134 – The #1 Reason For Financial FailureThe #1 reason for financial failure probably isn’t what you think!
More episodes >>
There can be many reasons for financial failure, but one sticks out above all the rest. Bob and Shawn go into detail about the #1 reason for financial failure and the detrimental effect that it may have on your financial future. What exactly do we at Christian Financial Advisors consider financial failure? It can include a variety of items, but some financial failures that Shawn and Bob talk about are:
– Not having a will in place
– Not having life insurance (or enough life insurance)
– The inability to retire because of lack of savings
Listen in to see how you can help prevent financial failure in your life!
HOSTED BY: Bob Barber, CWS®, CKA®
CO-HOST: Shawn Peters
Mentioned In This EpisodeChristian Financial AdvisorsWebsiteBob Barber, CWS®, CKA®Shawn PetersBible Verses In This EpisodePROVERBS 13:11Dishonest money dwindles away, but whoever gathers money little by little makes it grow.
2 PETER 3:8But do not let this one fact escape your notice, beloved, that with the Lord one day is like a thousand years, and a thousand years like one day.
Want to ask a question about your specific situation? Schedule a complimentary 15 minute phone call.
SCHEDULE AN APPOINTMENT###### Did you enjoy this episode? Sign up for email updates and never miss an episode.
EPISODE TRANSCRIPTIntro:
Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with a biblical worldview. Here’s your Christian Financial Advisors’ host, Bob Barber and his co-host, Shawn Peters.
Shawn:
Welcome to another episode of Christian Financial Perspectives, where we discuss how to use God’s word in finance. Bob, what do we got for today?
Bob:
Well, we have for today, Shawn, we’re gonna be talking about the number one reason for financial failure.
Shawn:
That’s gonna be a good one.
Bob:
I got a little tagline behind that, and it’s not what you think. Most people are gonna think very differently about financial failure after we cover today.
Shawn:
Then before we go any further, for those of you watching on YouTube, go ahead and put a comment down below on what you think the number one reason for financial failure is.
Bob:
Hey, that’s a great idea. Yeah, I like that.
Shawn:
And then we’ll see who got it, right? Yeah.
Bob:
Yeah. Do they get a prize?
Shawn:
yeah. You get to be the right comment.
Bob:
Okay. There you go. That’s right.
Shawn:
If you’re listening to us though, I guess you’ll have to go to YouTube for that. So let’s start with couple scriptures. Okay. How about Proverbs 13:11?
Bob:
I think that’s a good one.
Shawn:
“Dishonest money dwindles away, but whoever gathers money little by little makes it grow.”
Bob:
You know it’s the last part of that that’s so powerful here is that gathering money, little by little, that’s what makes it grow. It’s not all about getting rich quick. And we’ve talked a lot about that on Christian Financial Perspectives.
Shawn:
Yep. Well, let’s do one more then. 2 Peter 3:8, “But do not let this one fact escape your notice, beloved, that with the Lord one day is like a thousand years and a thousand years like one day.”
Bob:
I love that scripture. I’ve thought about it over the time cause sometimes people say, well, the Lord’s gonna be coming back tomorrow. I say, well it could be a thousand years because one day is like a thousand years with the Lord, because when we look at eternity and how long time is, but you’ll see how this goes, how these scriptures go with this later during the podcast. Alright. Or episode, because now we do video.
Shawn:
That’s right.
Bob:
And so we’re gonna be covering the number one reason for financial failure today. But next episode, we’re gonna be covering the number one reason behind financial success.
Shawn:
So make sure you tune into that one, too.
Bob:
There’s always two sides to it, and I want to give the reasons for signs of financial success as well. But I think it’s important that we look at these reasons. And a lot of people may relate to this because some of this has happened in their family, possibly.
Shawn:
And I think what we should do first is what is considered a financial failure? Because if you don’t know what we’re talking about here, you might be thinking something very different. And so, just to kind of get us all on the same page here, we’re gonna go over five examples that we’ve seen over and over, you more so than me.
Bob:
Oh yeah. In 30 years of doing this. I have seen these examples many, many times. And that first one…
Shawn:
That first one, A breadwinner dies without life insurance or enough to take care of the family in their absence.
Bob:
Seen this many times, unfortunately. And the breadwinner thinks that, oh, all I need is a hundred thousand dollars worth of coverage and they make a hundred thousand a year.
Shawn:
Right.
Bob:
And then they pass. So you got one year.
Shawn:
Exactly.
Bob:
Or you just haven’t gotten around to raising that coverage, or you don’t have any coverage at all. This is a very sad one, especially with a breadwinner that has a couple children at home like you do. You gotta make sure…
Shawn:
It changes over time. I know when Jenna and I first got married, the amount that I got was wasn’t millions of dollars. But the amount that I got at the time was enough that should something happen to me, it would give Jenna enough to completely pay off the house. That was the first thing. And also give her, I think it was like five years worth of supplemental income. You know, she wasn’t gonna be living like a queen, but it would be enough to cover all the necessities and everything. Give her time. Hopefully she’d grieve me for at least five years.
Bob:
Well life insurance today is just so cheap, Shawn, that there’s no reason for you to not get a 5 or 10 or 15 year term policy. It’s just pennies on the dollar.
Shawn:
But it changes over time. So that’s one of the things that like if you are the primary income earner make sure that hey, you got a new kiddo, well, you need to reevaluate your life insurance, as an example, especially if you’re still younger. You know, obviously if you’re talking about someone in their fifties and sixties, then by then you really should be focusing more on your own assets. Cause life insurance gets a little more expensive as you get older.
Bob:
I know.
Shawn:
So anyway, so that’s the first one.
Bob:
So here’s the second one I’ve seen. And this one just puts the family. I mean, you ever heard the old saying “rakes you over the coals”?
Shawn:
Yes.
Bob:
I mean, it just really rakes the family over the coals, and it is very sad. And I’ve seen this maybe 5 to 10 times in my career. Go ahead.
Shawn:
It’s when you have a family member that dies without a will and everything is locked up in probate for months or longer. Which also then costs the family thousands of dollars in attorney fees and all those accounts are locked up. So whether it’s spouse, parent, grandparent, aunt, or uncle, when someone dies without that will in place, there’s so much of that that could be preventable. Both the frustration – like you’ve already lost a loved one, but then they have to go through all the probate and the costs associated with it and not even having access to much of the funds anyway that could have helped with all kinds of things.
Bob:
Let’s get into the third financial failure that I see a lot of. And this one is a sad one as well. These are sad. All these are are tough to say. But there’s a reason, there’s a number one reason, this happens to every one of these failures that comes behind it.
Shawn:
So this next one is someone 65 to 70 years old. They can’t retire because they lack enough savings and investments to provide enough income for necessities. You know, again, it doesn’t mean necessarily having enough to retire like a king or queen.
Bob:
No, we’re not talking about 10 million dollars.
Shawn:
But not even being able to retire just for basic living expenses, and it’s sad.
Bob:
The fourth one is there’s no cash reserves when an emergency situation arise or loss of income.
Shawn:
Or sickness.
Bob:
Or sickness or just how about this one? Just your air conditioning breaks. Nowadays, that can cost $20,000 to fix. That causes failure because now what do you do? You either have to go in debt or you have to go in, say your 401k and borrow money out. And I consider that financial failure. And I’ve seen this not five times like we did on the probate. I’ve seen this hundreds of times.
Shawn:
Yeah. And a good a good rule of thumb that we always talk to people about is they have money that they want to invest, and one of the first things we ask is, well, what’s in your emergency fund right now? And many times people don’t have an emergency fund or they ask, well, what do you mean how much should be in there? So you always wanna make sure you’ve got about six months of your expenses, at least, for an emergency fund. And you might wanna have a little something else, too. Like you said, what if something goes out that’s expensive?
Bob:
So let’s get to the fifth one and we’re gonna just keep going and we gotta get to five of these, and there’s more. But I’m only using five today. And that fifth one I see is a financial decision that cannot be made on behalf of someone when they’ve been in a major accident or maybe they’ve had a heart attack and they go into a coma for a while, and they don’t have the right documentation in place to make financial decisions. I’ve seen this not a lot, but it has happened. And it can be scary because now the person that makes the financial decisions is no longer competent to do so.
Shawn:
So making sure you and your spouse are both on accounts and have signing authorization or maybe other part might be is having some sort of limited power of attorney or medical power of attorney or things like that.
Bob:
Yeah. So I want to ask you, you have any guesses yet? It’s really one word that leads to all this, these reasons for financial failure. Any guesses?
Shawn:
And if you’re watching, last chance to put it in the comments.
Bob:
Put in your comment. Okay. All right. Now, I’m going to go over the next part. We’re gonna give you some hints as to what this word might be because it’s a major word. And I’m telling you, I’ve seen this over and over, the number one reason. But we’re gonna quickly go through these. Shawn, you’re gonna read one and then I’m gonna read one.
Shawn:
All right. So to give you a hint, “It’s nearly Christmas. I’ll get around to getting that will done after the new year.”
Bob:
“It’s a new year, and we’re so busy. Let’s wait a few months until it slows down and then we can get on it.”
Shawn:
“Oh, no. Gotta get those tax returns done first, then we can talk about getting that will done. Saving and investing, getting an adequate life insurance policy. Let’s just wait until after April 15th.”
Bob:
“Oh no, it’s April 15th. After then, school is about out for the summer. We’re so busy now with all the kids and activities. Let’s wait until after school is out to get all this done.”
Shawn:
“The kids are only young once. We really need to plan our summer vacation for the family now, and we are all just so busy with the kids outta school. So let’s do all of this when we get back from summer vacation and get the kids back in school, kinda get back on a normal schedule.”
Bob:
“Yeah. Well we got ’em back in school now. But now we’re so busy with the kids and school and football and soccer and band and dance practices. Let’s wait until things slow down a little and then we’ll get some of these things done like getting that life insurance policy or starting that savings plan.”
Shawn:
Exactly. And the cycle continues. Now we’re back to Thanksgiving and Christmas and what do you know, New Year’s.
Bob:
Shawn, there’s never a convenient time. Okay. There’s never a convenient time to do these things to keep you from having financial failure. Shawn, you have an example when I was talking to you about this – I think it’s interesting that we have a client that for six years has been, what is this example?
Shawn:
So, unfortunately, we have a client that for the last six years, going back and looking at the previous meetings that we’d had and seen basically what looks like the same meeting, which is, okay, here’s where you’re at. Here’s what you might be able to retire on. Okay. Here’s what’s going on. And kind of, here’s the shortfall and here’s the solution. So maximize your IRA contributions and you know, a couple other little things. And so we get together the paperwork to get that move money authorization in place and get everything ready to go. And then, the same thing happens every year where we have a couple months where we’re contacting the client and trying to get things signed and move forward. It’s one of the things that, “Later we’ll get this done.” And now six years have gone by, six years that could have involved consistent investing and actually getting more prepared for retirement. And now, if they wanted to retire in another three or four years, they’re not gonna be able to because of that thing we talked about before. They’re not gonna be able to meet minimum necessities.
Bob:
So here’s that thing already. All right? It’s one word, it’s called procrastination. Procrastination.
Shawn:
End the video. Just kidding.
Bob:
Procrastination is the number one reason for financial failure. Every one of these that we named was because of procrastination. It was procrastination to get the will done. It was procrastination to get the life insurance policy or to get more coverage. It was procrastination to start saving. It’s procrastination.
Shawn:
There’s another one where that could go right along with that, Bob. All of these resulted from procrastination, but they were all preventable.
Bob:
Every one of ’em, every one of ’em was preventable. So Shawn, I went and I did some research on procrastination, like, why is this happening? I thought, well, this person just won’t get around to it or they’re just lazy or whatever. I was wrong. So, there’s a difference.
Shawn:
Not only that, Bob, but I thought it was really cool how God kind of orchestrated this script together because you tell me what this is about. That is, and I go, well, that’s weird because it was like two days before that maybe that I had just had a Ted Ed video that I saw pop up in my feed and it was on procrastination and like the science and the psychology of it. And it was just kinda cool. You know, we kind of both came to the same conclusion separately.
Bob:
So, I found two different definitions of procrastination. One is, and Garrett, I want you to put this up while I’m reading this so everybody can see this. Procrastination is the habit of avoiding an urgent task despite negative consequences. When people procrastinate, they often delay priorities and instead focus on less important, more enjoyable, simpler tasks instead. Okay. Shawn, will you read that next one? And put this definition up for this one also.
Shawn:
Sure. Procrastinators tend to prefer pleasure over progress. They are task adverse, putting off important tasks by doing something else that feels more productive or easier and enjoyable. They don’t seek rewards that seem far into the future.
Bob:
So we are gonna go over it, there was a lot of words and some common reasons about what causes procrastination, and we’re just gonna list these. But I’m telling you as I went over this, I never thought of it that way. Especially this first one, which is…
Shawn:
Perfectionism.
Bob:
Perfectionism. So they’re waiting for the perfect time. So a lot of people that procrastinate are actually perfectionists. Which they wanna do it the right way, right?
Shawn:
Yeah. And I used to think that, too, that procrastination was typically more associated with people are just lazy, you know? Or like, they just don’t feel like doing any work.
Bob:
It’s not the case.
Shawn:
And yet the vast majority of it is, I mean, we’re gonna go through ’em, but you’ve got perfectionism, you have fear of failure.
Bob:
I can see that.
Shawn:
Fear of criticism.
Bob:
Yeah. That I’ve made the wrong choice, so I’m just going to procrastinate and I’m not gonna move forward.
Shawn:
And I felt that when we were going through these and making this list, like, oh, I feel guilty that so many times, too, where I realize I’ve been putting this task off not because I don’t know how to do it or not because I don’t realize it’s important, but because to an extent, in the back of my mind, I’m thinking, “Well, I don’t want to fail at it.” You know? So for those of you watching and listening, I feel you. This is not just something we’re throwing at you, and we’re not guilty of it.
Bob:
I think we all feel this. Okay. All of us have done this. As an example to avoidance, I’m just gonna avoid this. It’s not gonna happen.
Shawn:
Maybe it’ll go away.
Bob:
I’m never gonna die. I’m never gonna get sick. I’m never going to retire. I’m never gonna have a cash reserve need. I’m like, wait a second. But you can avoid it for only so long because it’s gonna come along. Cause there’s a time for every season under the sun. And it says that Ecclesiastes that there’s a time for everything.
Shawn:
You know, Bob, my pastor in the last message he said, I don’t remember in the context of what he was talking about, but he did say that, “Right now, last I checked, the death rate’s still hovering at about a hundred percent.” Yeah. So that avoidance, it’s not gonna work because eventually we’re gonna go be at home with the Lord.
Bob:
There could also be some self-esteem issues, a tendency to self defeat. Depression can cause procrastination, trouble focusing, this is kind of one that maybe you and I, Shawn with our high energy.
Shawn:
What? No. ADD?
Bob:
Not at all.
Shawn:
Neither one of us. I’m not on medication for that either.
Bob:
Task aversion, resisting challenges. You don’t like that challenge. You just don’t want it because it doesn’t feel good. It’s hard to go into that.
Shawn:
Number 12, decision fatigue.
Bob:
Oh yeah. I think a lot of people do that.
Shawn:
Yeah. Especially, I mean, you’re at work and you know, you have all these different things you have to do and you’re trying to make decisions between all of them and you literally just get fatigued from all the decisions you make, and so you avoid some of them. You procrastinate. And it doesn’t go away.
Bob:
So we only have three more. Difficulty defining goals, a disconnect with the future self, and really just a lack of energy. I got a lot of these from a website that we could put up there. I thought was really good. What causes procrastination?
Shawn:
And there’s also really great Ted Ed video that we can maybe throw in there as well.
Bob:
Yeah. If you could do that for us, Garrett, and get that in there. Okay. So, one of the things I thought was, let’s give some solutions. And one is I think start very small. Okay. Don’t try to eat the whole elephant at one time. Just take small bites.
Shawn:
If you’re a vegetarian, don’t eat the entire gourd at one time.
Bob:
Yeah. So when we look at these five things, like if you’re the breadwinner, if you think that you need more life insurance, go online today and just get a quote. Or, just call your life insurance agent. Maybe that’s the one thing you’re gonna do. Not all five of these, but just that one that we mentioned, or if you don’t have a will, make that call to an attorney. So you don’t have to do number one right now, but maybe you just need to do number two right now. Or, you haven’t started saving. Well, you look at that and you’re going, man, I just don’t have the funds. Don’t go to Starbucks. Quit buying the expensive coffees. Don’t go out to eat as much. Just start with $20 a month or $50 a month $50 per pay period.
Shawn:
Just get it. Just do something where you get in the habit of adding something to your investments. It doesn’t have to be that you’re completely maxing it out, but like you said, maybe it’s – for that little step, Bob – find one thing that you know you keep spending money on that’s very discretionary and you don’t really need, and cut that budget in half and invest the other half.
Bob:
It’s like we were gonna say at the very end, I just gotta say it right now, it’s all about baby steps.
Shawn:
That’s right.
Bob:
Now, you knew when I said that what I was talking about. There’s a funny movie from years ago called “What About Bob?” And you know, I’m Bob. So it’s called “What About Bob?” and it is so funny, but it talks about baby steps and he can’t get anything done because he’s scared to go to the next one. You gotta see that movie. It is hilarious, and he starts doing baby steps and eventually gets where he can do anything.
Shawn:
That’s right.
Bob:
He actually becomes a psychologist in the very end. It is a funny movie, but I’m just telling you, don’t try for the all or nothing approach.
Shawn:
That’s right.
Bob:
Okay. Just little parts at a time. I think we can help you get over that procrastination.
Shawn:
And that’s just like the scripture that we read, it’s little by little. It’s not all at once. It’s little by little. Just start knocking out those individual steps.
Bob:
Make it this week I’m just gonna call the attorney and make an appointment for the will. Make it next week. I’ll just make one call, one call. I mean, I’m talking 40 or 50 hours in the week. Just make five minutes. Five minutes to make the phone call to the insurance agent or to go online for that quote. Your family will appreciate it. You will appreciate it. You will be glad that you started. Go to your human resources at your work and start that retirement plan. Say I’m gonna put $25 a week outta my paycheck. And then it’s gonna be $50 and then it eventually you’ll be surprised. I’ve got clients that are putting $1000 a month or 2000 a month into their plans
Shawn:
Your goal would be to just slowly try to increase that stuff at your work for your retirement and at least get to where you’re putting away the maximum your company will match, because otherwise you’re leaving free money on the table.
Bob:
Well, that’s gonna do it for today. I tell you, if you need help, we want to help guide you to get you in the right direction for this. And you can give us a call at (830) 609-6986 during business hours, or you can text that number or you can go visit our website www.christianfinancialadvisors.com. Now, I want you to join us on our next episode, because we’re gonna be going over the number one reason behind long-term financial success. And that’s gonna just be two words. This week was one word, procrastination. The next one will be two words. You can be thinking about what those words are that link up to long-term financial success. Until then…
Shawn:
Thank you for joining us and God bless.
Outro:
We invite you to listen to all of our past episodes, covering many financial topics from a Christian perspective. To make sure you don’t miss any of Bob’s upcoming episodes. You can subscribe to Christian Financial Perspectives on iTunes, Google Podcasts, Spotify, Stitcher, or Amazon Music to learn more about integrating your faith with your finances. Visit Christianfinancialadvisors.com or call (830) 609-6986.
Disclosures:
Investment advisory services offered through Christian Investment Advisors, Inc DBA Christian Financial Advisors also known as Christian Financial Advisors Management Group, a registered investment advisor. Comments from today’s show for informational purposes only, and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the host Bob Barber and his guests. Bob does not provide tax advice and encourages you to seek guidance from a tax professional. While Christian Investment Advisors believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.
Is creative giving something that has crossed your mind when it comes to your investments and legacy? If giving back is part of how you want to be remembered, then this episode is for you! Christian Financial Advisors is here to help you find unique ways to give back and help create a positive impact in our world.
This is such a great episode that coincides with the giving season we are in right now at the end of the year! Bob and Shawn discuss unique and creative ways that you can give using devices like donor-advised funds or even creating your own family-giving fund. Really, no matter which way you decide to give back with all that God has blessed you with, paying it forward is a way to love your neighbor as yourself.
It’s that time of year again! The time where we all start looking at our finances to try and figure out what types of tax savings we can procure through various strategies before December 31st hits. Christian Financial Perspectives is here to help you out with that! Of course, we always recommend running these strategies by your CPA or tax professional first.
Bob and Shawn mention multiple tax saving strategies and deductions with data included for married couples, single filers, head of households, and those over a certain age. There’s a lot of information in this episode, so we recommend grabbing a pen and paper to take notes.
In this episode, we present several verses on Biblical stewardship, management, and ownership to help better understand how Christians should approach money and wealth with a Biblical worldview. If you are a Christian, does the way you handle wealth line up with your Biblical worldview? Did you know that you could be unintentionally supporting anti-biblical values with your investments and not even know it? Not only that but the way that we view and manage money is so important.
We are actually the managers of all that God has blessed us with here on earth, and we are to manage His property and wealth wisely. This is also known as stewardship, or being responsible for managing something that belongs to someone else. As Christians, it is important to be good stewards of all that God has blessed us with in His name.
Finding a financial advisor should be treated like a job interview, especially when searching for a Christian financial advisor. You probably don’t want just any investment advisor handling your money, which is essentially your future. In order to try and find the best financial advisor for you and your situation, Bob and Shawn have put together 21 questions that they believe you should ask a financial advisor. This includes questions like:
- What is your educational background?
- What kind of safeguards do you have in place to protect my financial information?
- What if something happened to you, or you were out on vacation or sick leave, who would serve me?
All of these and more are addressed in this episode so that you can be as confident as possible in your future when it comes to choosing a financial advisor.
It has happened to the best of us. We have a big financial decision, and we jump the gun to make a large purchase before we ask for advice or really think things through, leaving us financially vulnerable afterward. Since making big financial decisions is something that we all face eventually, Bob and Shawn have put together seven recommended steps you should take before making a large purchase.
These steps can be used for anything, such as buying a new car, your first house, or even new appliances. Gaining advice and insight through using these seven steps can help take away the stress and fear of the unknown when it comes to your finances. Knowing you have the monetary means to confidently make a large purchase can offer an indescribable feeling of financial freedom.
Bob and Shawn discuss the pros and cons of an annuity, i.e. the good, the bad, and the ugly. What exactly is an annuity? It is an insurance contract issued and distributed by financial institutions with the intention of paying out invested funds in a fixed income stream in the future. We discuss the types of annuities – variable annuities, fixed annuities, and fixed indexed annuities.
Did you know many annuities don’t require you to be a financial advisor to sell them? This is why it is so important to always go through a fiduciary-based investment advisor when dealing with annuities and other investment products. For example, fixed and fixed indexed annuities are the MOST sold annuities but are NOT regulated by the SEC or FINRA, which can lead to abusive selling practices. This, along with several other issues, may lead to severe complications in the future for investors. There are some good qualities as well, which are also touched upon in this episode, but we want you to get the full story.
Bob and Shawn delve into the investing realm to discuss why investing isn’t something that you should just DIY. This episode is super important for anyone who has ever thought about investing on their own. Investing correctly involves time, tools, and expertise. You really might be surprised at the flaws of DIY investing, and why it is not something that we recommend you do solo!
Christian Financial Advisors has the tools to help you with an investment portfolio, and these tools come at a price of both money and time. Think of how many things in your life you normally wouldn’t attempt to do-it-yourself: fixing household appliances, car maintenance, roofing, etc. You call a professional! These same conditions also apply to investing. Find out why you should stick to a professional, fiduciary based financial advisor when it comes to your investment portfolio.
We discuss the basics of an estate plan, documents that should be included, and the importance of a financial power of attorney. How long has it been since you last updated your estate plan, or do you even have one? There are obvious considerations, like having a new child, and not-so-obvious reasons like your child just became a legal adult.
No matter your rationale, it is crucial to keep your estate plan as up-to-date as possible, usually every 3-4 years. These topics and more are broken down into an easy-to-follow conversation to help you better understand the importance of updating and creating an estate plan.
Last episode, we covered “10 Pitfalls To Retiring Well”. In this episode, Bob and Shawn go a little more positive in discussing “10 Keys To Retiring Well”. Whether you are 20 years away from retiring or thinking about making this life transition within the next couple of years, this is advice for everyone of every age and life stage within this episode’s unique discussion.
Retiring can be daunting, and while it may seem like there are one or two keys missing, it’s okay to feel that way! However, Christian Financial Advisors wants to take as much fear out as possible by helping you prepare for this life’s transition. So sit back and listen to discover some key takeaways you can obtain from this episode on “10 Keys To Retiring Well”.
In this episode, Bob and Shawn introduce some of the common pitfalls that occur that may keep you from retiring well. Many of us look forward to retirement, but when the time actually comes, we don’t know what to do with all of the extra hours in the day. It can be hard to face retirement, especially when it comes too early, and we have wrapped our entire identity around our career.
Here are 10 pitfalls to watch out for when it comes to retiring, including factors like retiring too early and lack of purpose. So, tune in to learn about the “10 Pitfalls to Retiring Well”.
What comes to mind when you hear the word “gold”? For most of us, it creates a sense of wealth, stability, and purchase power. Gold was once considered a source of wealth and currency in the pre-global/pre-digital world economy (The Roman Empire and Biblical times) when it was readily accepted as a form of payment. However, times have changed, and the amount that gold is really worth – especially compared to the irreparable damage gold mines cause – just doesn’t seem to be worth it.
While gold might have been a good investment in the past, it is not great for long-term investments. Why? Bob and Shawn cover seven reasons why gold might not be a wise investment.
Do you vote for candidates that align with your Christian values? Would you vote for a candidate that aligns with your values and then gives money to their opponent’s political campaign? The answer is most likely no.
In this episode, Bob and Shawn discuss if it makes any sense to vote with your values and then turn around and invest against your values. Literally millions of Conservative voters may be unknowingly supporting the leftest, liberal agenda by how they invest within their IRA’s, company retirement plans, government retirement plans, and brokerage accounts.
Isn’t it time to align how you vote with how you invest?
Bob and Shawn discuss the importance of the Certified Kingdom Advisor® (CKA®) designation, its meaning, and the requirements that go into it. A CKA® is something that you may not have heard of, but is extremely important in the realm of Christian professionals. For Christians choosing an investment portfolio, many find it important to connect with a financial advisor that shares their values and faith. Thus enters Kingdom Advisors.
Kingdom Advisors is a professional association that offers training and support to various Christian financial professionals who aim to integrate faith and finances within their business. They have taken Biblical values, along with core financial training, to create a designation that combines the two called a Certified Kingdom Advisor® (CKA®). If you see a CKA® designation next to a financial advisor, it symbolizes that you should receive sound financial advice within a Biblical context.
Bob and Shawn present just 5 of the reasons that it is so important to work with a Christian financial advisor. A Christian financial advisor differs from a financial advisor that just happens to be a Christian. They may sound the same, but they indeed are not.
A Christian financial advisory firm believes in Biblically responsible investing and looking at investing in companies that make a world a better place. These morals and ways of investing are integrated throughout the company and how they operate.
A financial advisor that happens to be Christian may not be implementing these biblical guidelines into the way they invest. As a person, they are Christian, but how the company operates may not be. So, listen in as we complete our 3 part series on, “Why You Need…”
In this episode, Bob and Shawn continue our series on “5 Reasons You Need…” by discussing the reasons that you need an investment advisor. Sometimes, it seems like you can go it alone when you hear about all of the day traders out there and advertisements that make investing look easy. However, there’s a lot that goes into it, which is why you need a registered investment advisor to help you along your financial journey.
Proverbs 15:22 states, “Plans fail for lack of counsel, but with many advisers they succeed.” A good advisor monitors your portfolio and helps you stay on track with your financial goals. We are here to help and try to take the confusion out of investing. So, listen in to see just 5 of the many reasons why you need an investment advisor!
There are many reasons that you might need a financial planner, but Bob and Shawn cover some of their favorite reasons in this episode. Just like you wouldn’t go on a long road trip without your maps turned on, you also don’t want to face life’s financial minefields without a map. A financial planner will help you create this map to help you navigate your financial life a little easier.
A great financial planner can also help you create a budget for saving, spending, and investing, while aiding you in making adjustments over the years as financial situations change. Learn about all these and more as you listen to 5 reasons why you need a financial planner.
Check out these questions that Christian Financial Advisors recommends you ask yourself if you start panicking at all of the recession talk that is going around. You might just be surprised with your answers! Bob and Shawn really encourage you to think about what you are DOING right now during this time instead of just what people are SAYING.
Increased costs for both gas and food staples can make it feel like the world is ending, and many doomsayers want everyone to think just that. However, if you look around and really analyze the economy, things aren’t always as bleak as they first seem (or are making you feel). Here is just a little bit of encouragement for you during these times of uncertainty.
The stock markets can make even the best of us get emotional. It goes up; we may become happy and excited! It goes down; we might become worried and stressed. So, how can we combat this roller coaster of emotions in order to get a better handle on how we feel when it comes to the continual ups and downs of the stock market?
One way is by getting educated on typical market trends and understanding just exactly how bear and bull markets work. In this episode, Bob and Shawn present some tips, and of course Bible verses, on getting a better perspective on the market, its checks and balances, and just taking your emotions out of the investment game, or at least as much as possible, anyways!
In this episode, Bob and Shawn discuss the financial sharks that we all have to watch out for during turbulent times and how they like to disguise themselves. For example, if you hear about a great investment opportunity that sounds “too good to be true”, then it is most likely just that – too good to be true. Have you ever seen one of those big postcard invitations in the mail for once-in-a-lifetime opportunities featuring a big juicy steak on the front? Have you ever received an email from a professional doomsayer about how the country is ending but miraculously happens to have the product to protect you from the disaster they just made up?
Most of these are meant to prey on our emotions in order to sell products to benefit the seller and not to benefit you. 1 Peter 5:8 gives this warning: “Be sober-minded; be watchful. Your adversary the devil prowls around like a roaring lion, seeking someone to devour.” The next time you receive a free offering for a steak at a high-end restaurant, be aware of the financial shark that may be behind this so-called “opportunity”.
The Bible says a lot about stewardship and finances. In fact, stewardship is one of the most talked about subjects in the Bible! As a Christian, we believe that God owns everything, even our money. If we truly believe that God owns everything, then shouldn’t we be trying our best to invest and manage our money in a way that honors God?
In this episode, Bob presents various financial fundamentals for Christians that are looking at investing their money wisely and according to Biblical principles. From involving your spouse in investment decisions to staying consistent over many years, here are 10 Christian fundamentals for investing.
Instead of looking at all of the cons of a bear market, Bob and Shawn discuss some of the pros of a falling market and how you might be able to take advantage of it. A bear market isn’t for the fainthearted, and it can cause most people to question if they have made all of the right choices with their money up until this point. However, without a bear market, we wouldn’t have bull markets. There must be a down to an up, an opposite driving force, if you will, that maintains balance.
The only guarantee we have in the stock market is that it will have ups and downs. However, when the market starts going down, even the best of us start to question our decisions. Instead of questioning all of our choices, Bob and Shawn pose 7 questions we should be asking ourselves in order to try and remain confident. So, what questions should you ask yourself when the stock markets are in a downward trend? Find out by listening!
Listen in as Bob and Shawn discuss how a Christian should respond to investment uncertainty. There is always some form of uncertainty and risk when it comes to investing, but how we react to that risk makes a big difference. The last thing we want to do is let pure emotions dictate our decisions. More importantly, looking towards scripture is one way to try and gain peace and confidence when it comes to our investments. It all belongs to God anyways, doesn’t it?
In this episode, Bob and Shawn discuss all of the emotions that we go through when the market isn’t exactly doing what we want (i.e usually a bear market). They also cover various scriptures that may help bring us wisdom and peace during these turbulent times and how to best combat these emotions. The stock market and investing always has ups and downs. It’s part of what makes investments both a risk and a benefit. Volatility is part of the natural cycle of a stock market, and while it’s okay to be a little nervous, it’s not okay to act based solely on emotions.
Tune in to part 1 of our 2 part series on 12 Christian Financial Principles. In this episode, Bob and Shawn cover the first 6 principles out of 12 that we, as Christians, should all strive to live by. These Christian financial principles are full of wisdom since they come directly from scripture. The first 6 Christian financial principles that we are covering today include: God Owns It All; Work Is Good; Honesty, Truthfulness, and Integrity; Pay Your Taxes; Be Careful With Debt; and Give Generously.
Tune in to part 1 of our 2 part series on 12 Christian Financial Principles. In this episode, Bob and Shawn cover the first 6 principles out of 12 that we, as Christians, should all strive to live by. These Christian financial principles are full of wisdom since they come directly from scripture. The first 6 Christian financial principles that we are covering today include: God Owns It All; Work Is Good; Honesty, Truthfulness, and Integrity; Pay Your Taxes; Be Careful With Debt; and Give Generously
In this podcast, Bob and Shawn discuss the math behind why you should wait to build or buy a home right now. When COVID-19 hit, the Federal Reserve and government put over 8 trillion dollars into the economy to stimulate it. This created massive inflation, especially in real estate. Now, with the federal reserve saying they are going to raise interest rates back to normal, taper bond-buying by the billions of mortgage-backed securities, and reduce their balance sheet, homes prices will have to decline dramatically to compensate.
The new year is a time for new beginnings. Most of us take the opportunity of a new beginning to make life changes and goals (about 60% of us), but many never succeed in forming these new habits. Bob and Shawn discuss writing down goals and other methodologies (like the SMAC method - Specific, Measurable, Achievable, and Compatible) to help you be more successful in obtaining your personal goals for the year. Tune in to listen to how you can make 2022 the year for you!
Bob and Shawn discuss meaningful, financial giving recommendations on this episode, including Donor Advised Funds, donating to a food bank, or giving coats to a homeless shelter. Unfortunately, for many, consumerism and materialism has become the true meaning of Christmas. Instead of celebrating the birth of our Lord through giving, Christmas has turned into a time of financial stress and burdens. Instead, it should be a time of peace and joy as God intended it to be. It’s time for America to again find the true financial meaning of Christmas where it’s truly about joy, meaningful giving and the gift of God's son.
Is Christmas shopping stressful? How do you get the best prices? Shawn is joined by his wife (and Bob’s daughter), Jenna, in this special Bonus Christmas episode. Jenna is usually behind the scenes of podcast editing, but wanted to step in front of the mic this time to share some of the strategies that she uses when it comes to Christmas shopping. Therefore, the flow and style of this bonus episode is completely different! They mention everything from stocking stuffers to hitting up lightning deals to try and obtain the best prices around holiday shopping.
Are you about to make a large, financial decision? If so, this is the podcast episode for you! Making a decision that involves a large, financial purchase is both stressful and gratifying at the same time. However, there are also A LOT of questions to ask oneself before an actual decision is officially made. We are not saying to not reward yourself for hard work or to live like a pauper (unless that’s your calling), but what we are saying is to be wise, think long about any large financial decision, and also ask yourself some of the following questions that Bob and Shawn cover in this episode.
When it comes to high investment returns and wealth, there are common traits, attributes, and characteristics that we see in those with millions in their investment accounts. Many people believe high investment returns are the only way to wealth, but that usually is not the case. For the majority of us, most of our wealth growth has to deal with circumstances outside of returns. Therefore, Shawn and Bob present 15 commonly seen traits in millionaires that Bob has personally seen in his own clients over the past 37 years, as well as covering some myths on chasing investment returns.
In our last episode, Bob and Shawn spoke about 4 different economic booms and busts. This time, they discuss how to prepare for the bad financial times during the good financial times. How can we prepare for an economic bust, or what Bob and Shawn are calling an “economic winter”? Bob points to several passages in the Bible that discuss preparedness and anticipation.
Welcome to our 100th podcast!!! We've taken quite a long break from recording over the summer, but we are back at it with Christian Financial Perspectives Podcast. In this episode, Bob and Shawn discuss the history of economic booms and busts, from the rise of the Roman Empire all the way up to the recent 2008 Real Estate Bubble that Burst and where we are today. HISTORY repeats itself over and over with nearly the exact same mistakes. Will it be any different this time? Listen to find out!
In every movement, there are pioneers and those who pave the way - those who step out in faith towards a great unknown. In this episode, Bob and Shawn talk about the pioneers of the faith based investing movement. For many years, people were unable to choose who and what their investments were supporting because there just wasn’t information readily available in order to make faith based decisions when it came to choosing where your money went.
Bob is joined by Ron First of Christian Insurance Services to discuss the do’s and don’ts of the insurance business. Insurance is more than just a requirement. Instead, we need to look at insurance with the entire picture in mind as part of your entire financial plan. Ron covers the most common insurance coverages, like health and auto, while also delving into rarely mentioned areas, like disability.
We are going to break down different ways to avoid making financial mistakes when it comes to major financial decisions. Examples of major financial decisions include items like buying a new car, moving, buying a new or second home, or taking out a college loan. Basically, this is any financial decision that goes above and beyond the normal daily, or even monthly, monetary decisions that we make. In order to be best prepared when it comes to large financial decisions, we have divided our process into three different areas: Emotional, Spiritual, and Factual.
Unfortunately, many of us have fallen prey to common financial mistakes, but it doesn’t have to be that way. There are so many that are easily avoidable if you know what to look for. This episode breaks down 21 of the most common financial mistakes that Bob has seen people make over and over again during his 30 years in the financial business.
Are you someone who gives your finances and your time out of a cheerful heart, or is it something you feel obligated to do? This episode discusses what the Bible says about the importance of giving generously. Giving generously is a very important subject in the Bible and one on which Jesus frequently spoke. It shows our faith to God and that we trust in him for support.
Just 2 years ago, having a financial advisor in a different state, or even city, was something that most people never considered. Why? The capabilities to video chat, email, and sign digitally have been available for many years, but most people had not been utilizing these technologies. The recent coronavirus restrictions changed all this and vastly accelerated the adoption of these technologies far ahead of the expected timeline. In this podcast, we discuss why “Location no longer matters”.
Christian Financial Advisors has received numerous phone calls, emails, and texts about many of the recent events. Bob addresses some of them including the coronavirus, the new administration and Biden’s numerous executive orders, the massive borrowing of money due to coronavirus unemployment, and last week's manipulation of GameStop’s stock price. Take a step back from all of the chatter of the news and social media platforms and replace it with prayer, scripture, and God’s outdoor creation.
Bob and Bailey read and discuss 21 of Bob’s favorite stewardship verses that are a great way to start 2021 off right when it comes to your financial decisions. Did you know that the Bible contains over 1500 scriptures that have to do with money, stewardship, and possessions? Jesus actually spoke on stewardship more than heaven and hell combined. It’s hard to go to any book in the New Testament without seeing it.
What are your goals for 2021? Bob and Bailey share 21 personal and financial goals, in no particular order of importance, that are ideas for goal setting for 2021. From eating healthier to creating an estate plan, these are ideas for everyone!
Tis the season for giving, so what better way to celebrate the giving spirit of Christmas than to learn how to give better and more efficiently. In this podcast, Bob covers the most efficient ways to give using the other 90% of what’s in non-cash assets. He is joined by a charitable giving expert, Ryan Assunto of the National Christian Foundation, to talk about giving more efficiently.
With so many important factors that our finances play into, isn’t it just as important to find a financial advisor that has your best interests in mind in order to help you obtain all your financial financial goals? In this episode, Bob and Bailey cover many of the traits you should look for when choosing a financial advisor, especially the importance of choosing a fiduciary, fee based advisor over a commissioned based advisor with a potential conflict of interest.
We encourage you to listen to episode 87 on “Understanding Investment Risk” before delving into this episode on “Which Investment Models Are Right For You”. Bob discusses how these risks play into picking an investment model(s) to build a complete portfolio that corresponds to your goals, needs, and risk number.
Life is full of risk. Everytime we get into a car, move to a different city, get on a plane, or start a new job, there is a RISK, and the list goes on and on. What if the human race decided to never take any risks? Risk is not a bad thing because a life completely void of risk would be very boring. In this episode, Bob and Bailey discuss 15 types of investment risks, because when you know what the risks are, you can make better educated decisions.
In this podcast, we cover how millions of conservative voters are unintentionally supporting the leftest agenda every day, week, month, and year in their various types of retirement and investment accounts and then we give you an alternative to Invest Right.
What if we told you that taking out $30,000 from your investments to buy a new car today could end up costing you upwards of $115,000 in your financial future? How is this possible, you might ask. It’s called the Rule of 72. Learn how the Rule of 72 affects everything from savings to withdrawing money from an investment portfolio.
In Part 2, we discuss how the different elements of financial planning fit into each life stage. Financial planning should be living, breathing, and changing as you do throughout all the stages of your life. Bob educates you in this podcast about many of the various pieces of the financial planning puzzle and how they should all fit together for a successful outcome.
We all have different phases of our lives that demand unique financial requirements. Financial planning is definitely not a “one size fits all” or even a “one size fits most” type of solution. We each fall into separate categories when it comes to income, expenditures, debt, and savings. However, most of us can divide our lives up into 4 different stages, which Bob and Bailey discuss in part 1 of our episode on “The Life Stages of Financial Planning”.
People like the idea of having rental property as investment income because it’s a tangible asset that you can see, feel, and walk around. However, many times, the risks far outweigh the benefits, especially if you are looking at rental property as a form of passive income. Instead of a rental property making money for you, you can actually end up losing money. There are many risks associated with rental property income, and Bob covers the top 10 risks of vacation rentals and home rentals in this episode.
Have you ever had to make a really important decision and just didn’t know where to start? Whether it was moving for a job or deciding whether or not to sell a house, we all have been there. It is usually an extremely difficult and stressful time. Well, what if there was a decision making process that you could follow to aid in your choice? Lucky for us, there is! Ron Blue has created a 10 step process concerning decision making so that you can have more confidence in the choices you make.
Think about great men and women of God who have lived their lives to the fullest, packing meaning and purpose into everything that they have accomplished. No matter who it is, they probably all have one thing in common. They finished well. Dr. Ken Boa of Reflections Ministries joins Bob in discussing living a life with purpose as they discuss “7 Keys to Finishing Well.”
Bob is joined by guest Bill High, the CEO of The Signatry, a global Christian Foundation that equips donors, advisors, and ministries to fulfill their unique roles in expanding and impacting the Kingdom of God. He is also a published author and conference speaker on creating lasting legacies. Creating a lasting legacy is exactly what Bob and Bill discuss in this episode of Christian Financial Perspectives.
This episode covers one of the most common topics when it comes to marital conflict - finances. When it comes to marital communication about finances, many of us have differing expectations. Joining Bob in offering her expertise on this subject is speaker and consultant, Sharon Epps. Sharon helps churches and individuals energize stewardship and generosity. She is also the founder of Women Doing Well, a “Christ centered organization that helps women of influence and affluence find their purpose and passion in life and develop a plan for how to further their personal generosity journey”.
Many of us reach a point in life where we have achieved some measure of success and might have even accumulated more than we need, yet there’s still something missing. Eventually, we come to realize that accumulating more things or pursuing career advancement is simply not enough and we want our lives to count for something that will live on long after we’re gone. Bob is joined by special guest Lloyd Reeb, the founding partner and spokesman for the Halftime Institute.
Bob and guest, Jim Wise, discuss the term that Jim coined called “inheritolatry”. Inheritolatry is the decision to leave an abundance of financial resources to the next generation without regard to financial responsibility, spiritual commitment, or the size of the estate. The typical American way of inheritance is dividing it equally among our heirs, but is it biblical?
Bob interviews Jason Myhre, the Director of Advocacy at Eventide Investment Management, whose philosophy is “Investing that makes the world rejoice!®”. Learn about lining up your investment portfolio with God honoring companies that are making a positive impact on our society while avoiding the negative ones. Jason delves into the history of Eventide and the positive impact that investing with your values can have on our world.
Bob interviews Dr. Andy Ward, who breaks down fear, what causes it, and the brain’s reactions to feeling fear. In the midst of COVID-19, almost all of us are facing emotions like fear, grief, and anxiety surrounding the uncertainty following this pandemic. We are truly hoping that what he has to say about fear and uncertainty will help you during these times of unrest surrounding the coronavirus epidemic.
Tune in with Bob as he discusses retirement and finding God’s purpose during this transitional time. What is God’s desire for your life during retirement and are you open to being called to a higher mission? Joining Bob is John Haanen, the founder and CEO of the “Denver Institute for Faith & Work”, an educational nonprofit that teaches and convenes leaders on theology, work, calling, and culture.
Bob and special guest Shawn McCammon discuss the top 10 mistakes surrounding Inheritance and Estate Planning. Shawn is an estate planning attorney and CFP® who works with individuals and families to find effective solutions to meet their goals in the areas of estate planning, trust administration, business planning, and asset protection.
Marriage is a game changer. You are becoming a team, a unit. It starts out full of promise for a hopeful future, but sometimes life gets in the way of happily ever after, and we soon run up against conflict. Since money is THE most common cause of friction in most marriages, Bob and Mary Jo have made an episode focusing specifically on finances in marriage.
What happens when you are looking at a possible job loss as you are nearing retirement? That’s the question we tackle on this episode about mid career risk and its impact on retirement planning. It may be happening to you, or someone you know, at this very moment. It’s yet another example of how we have to hope for the best and plan for the worst.
Are you striving to have a solid financial future? It starts with clarity of your financial life. Clarity allows us to see the truth in past matters in order to make the best decisions for the future. It’s no different for finances. They decided in this episode to break down the word C-L-A-R-I-T-Y into financial counterparts according to each letter.
Bob and Mary Jo interview very special guest Ron Blue. Ron is the president and founder of Kingdom Advisors, as well as the founder of The Ron Blue Institute. Listen in as we dive into what motivated Ron to get into the Biblical financial planning movement, the amazing Christian leaders he met along the way, and his plans for Kingdom Advisors as this incredible organization continues to grow.
This episode ends part 2 of our 2 part series on “20 Money Principles for 2020” to help you become more financially successful, with an emphasis on what the Bible says about financial issues. Biblical guidelines not only help us to live a successful life, but they also illustrate many of the financial principles that are mentioned.
This episode begins part 1 of our 2 part series on “20 Money Principles for 2020” to help you become more financially successful, with an emphasis on what the Bible says about financial issues.
Do you have the desire and courage to be a generous giver? In this episode, we look at various ways to financially give to those causes closest to us. The Bible teaches us to pursue a life that imitates Jesus, and what better way than by being a generous giver?
We look at some year end tax planning tips for this year that need to be incorporated as soon as possible, as well as some that might benefit you over the course of a lifetime. There are no guarantees in life but one thing we can all probably agree on is that taxes will only go up and deductions will only become fewer in the years to come.
Bob and Mary Jo discuss the importance of having an excellent credit rating. A credit rating is not only used when buying a car, home, or applying for a credit card, but it is also used by insurance companies determining rates, employers determining whether to hire you, landlords determining rent, and even utility companies determining a deposit.
As Thanksgiving approaches, Bob and Mary Jo share their personal stories about what they are grateful and thankful for and the importance of always having a thankful attitude.
In this interview with Jonathan Saenz, President of Texas Values, Bob and MJ discuss the importance of Christian Values that formed the great state of Texas and how they are in jeopardy of being lost in Texas and across the nation. Texas, being the economic superpower that it is, is being attacked by leftists and if they capture it, they may just capture the whole nation.
Bob and Mary Jo discuss basic household insurance, commonly referred to as Property & Casualty (or P&C for short). Insurance is one of those things we know we need, but we always seem to buy it reluctantly. Some may view it as a necessary evil, while others may view it as a commodity and opt to shop on price alone. However, some insurance is more than just insurance, it’s real protection. It’s peace of mind knowing that you, your loved ones, and your worldly goods are covered.
Everyone has a story to tell about their history with money, but we also have a money style that may stem from this history. Our money style tells us who we are and how we view our money. Only when we begin to understand what drives our behavior when it comes to money decisions can we begin to make changes.
Money is an emotional topic, and everyone has a money history, whether they realize it or not. Bob and Mary Jo discuss their financial past and how it changed the way that they view money today. They explore money histories and how it impacts behavior.
As financial advisors that serve other small businesses every day, Bob and Mary Jo understand the small business owner and want to help. This episode covers small business owners’ long term financial interests and applying wisdom to the decisions they make today for a bright future.
Bob and Mary Jo discuss the loss of a spouse. Having been financial advisors for many years, they both have dealt with clients who have experienced the life changing event of losing a spouse through death or divorce. Whether you fit in this category or not, you may know someone who does so we invite you to listen and share with anyone you may know dealing with a loss or about to.
In this podcast, Bob and Mary Jo answer three questions about integrating your faith with your finances.
Is it okay for Christians to be financially successful? Purpose vs Profits - can you invest for both? Why the decline in individual generosity?
Bob and Mary Jo are joined by special guest and brother in Christ, John Madison, CPA. John is the owner and founder of Dayspring Financial Ministry, a biblical financial counseling and coaching ministry. John explains the more tax efficient ways that we can donate to charity given the current tax laws.
As Wealth Advisors, Bob and Mary Jo are continually asked both hard and easy questions. However, they get many of the same questions over and over as clients strive to find contentment with their financial situation(s). With this in mind, this episode covers some more of the top questions that many financial advisors, like Bob and Mary Jo, are asked on a daily basis.
My how time flies! It's already been a year since our first podcast episode of “Christian Financial Perspectives” was released. We are celebrating one year with our 52nd episode recapping some of our favorite episodes.
Have you ever heard something that sounds too good to be true on a radio program where “Financial Planners” hype certain products that offer great returns at little to no risk? They often sound too good to be true, and listeners are getting sucked in to a promise that is misleading and something that they may not fully understand. In this episode, Bob and Mary Jo cover many key points to protect yourself and equip you to make more informed decisions.
Volatility in the markets can lead to many doubts when it comes to financial decisions. As experienced advisors who have seen many market downturns as well as many periods of strong market growth, Bob and Mary Jo have established some best practices, which they share on this episode.
This episode is a very educational, informative, and complicated topic on an extremely important subject - properly titling property and assets. We urge you to listen as it could mean the difference between chaos or an orderly process in the most extreme times of stress.
The phenomenon of suddenly coming into wealth is called - you guessed it - Sudden Wealth Syndrome. This episode is perfect for anyone that has recently, or soon will, come into a large amount of wealth. Bob and Mary Jo discuss four psychological dangers and four solutions for Sudden Wealth Syndrome, as well as nine common ways sudden wealth is obtained.
Often times, it is financial decisions that are filled with regret. Many times, it’s because we didn’t know any better. Unfortunately, most people don’t really understand their complete financial situation and if it is healthy. Bob and Mary Jo are here to help with that by presenting some of the most common financial mistakes that they see with clients.
Learn about the financial aspects of the most common life stages. Whether you are just getting started, on the brink of retirement, or somewhere in between, consider your life stage when making these financial decisions that can impact your future.
Bob and Mary Jo discuss a topic that is very important to the financial life of most seniors, and that is Medicare with special guest Mr. Brooks Boyd of Senior Savings Organization.
Eventide Asset Management, LLC is a Boston-based registered investment adviser pursuing “investing that makes the world rejoice.” Founded in 2008, Eventide’s vision is to serve individuals, financial advisors, and institutions by providing investments that create compelling value for the global common good.
Everyone seems to focus their attention on investment management. However, it is the ongoing relationship between your investments and planning for the future where the real magic happens. Financial Planning is a lifelong process where you manage your entire financial picture in order to achieve your financial goals.
In this episode, we want to introduce you to a tool that will help you choose peace over worry when it comes to your investments called Riskalyze®. Riskalyze® is a financial technology company that provides software for analyzing investment risk and building and implementing investment portfolios. Bob and Mary Jo interview special guest, Mitch Mitchell, who is the Customer Success Manager for Riskalyze® to give a complete breakdown of this piece of technology, how it works, and how you can use it.
Bob and Mary Jo address the phenomenon regarding FOMO or “Fear Of Missing Out”. This episode shows how we can move from FOMO to JOMO "Joy of Missing Out" - joy and contentment with where you are and what you have. Wikipedia defines it as "A pervasive apprehension that others might be having rewarding experiences from which one is absent.” This social anxiety is characterized by, "A desire to stay continually connected with what others are doing".
In this episode, Bob and Mary Jo cover the importance of working with a trusted advisor to help you understand the complexity of all of the moving pieces and parts of retirement and how these pieces fit together for your benefit.
In this episode, Bob and Mary Jo talk about something fun that is on everyone’s mind this time of year - summer travel. They share ideas, tips, and suggestions on how to get the biggest bang for your buck while traveling.
You may have heard Bob and Mary Jo talk about Kingdom Advisors before. Joining them is special guest Rob West, the President of Kingdom Advisors, a professional association promoting the integration of a biblical worldview into financial practices. In this episode, you will learn about Kingdom Advisors, who they are, and what that can mean for you.
On today’s show, Mary Jo is joined again by Ron First of Christian Insurance Services to discuss “Planning for Incapacity” in our 2 part series. In this episode, Mary Jo and Ron discuss protection - primarily long term care planning and ways to cover this expense.
On today’s show, Bob and Mary Jo are joined with Ron First of Christian Insurance Services to discuss in a 2 part series on how to plan for incapacity. Who doesn’t want that? So listen to this episode to learn about an extremely important topic and one you should pay special attention to no matter what stage of life you are in.
Are you thinking about buying a new car, trading your car in, or just wondering how to save money when it comes to the entire car industry? Many of us give very little thought to the total cost of owning a car. Join Bob and Mary Jo as they share their experiences, tips, and tricks when it comes to purchasing a new car.
On this episode, Bob and Mary Jo interview special guest and friend, Robert Netzly, the founder and CEO of Inspire Investing. Inspire focuses on biblically responsible investing with a goal to “inspire transformation for God’s glory throughout the world by building low cost, biblically aligned investments that create meaningful change in the lives of people across the globe”.
In this week’s show, Bob and Mary Jo wrap up our series called “Biblical Viewpoints of Money and Wealth”. This was originally designed as a Bible Study written by Bob Barber. The series is a deep dive into what God’s word has to say about money.
In this week’s show, Bob and Mary Jo continue along in the “Biblical Viewpoints of Money and Wealth” series. It was originally designed as a Bible Study written by Christian Financial Perspectives host, Bob Barber.
In Part 2 of the Biblical Viewpoints of Money and Wealth series, Bob and Mary Jo explore the “Roles and Responsibilities of Owners and Managers” and “The Biblical Worldview of Working and Retirement”. Here at Christian Financial Perspectives, we believe that all financial decisions are spiritual decisions because everything belongs to God, and we are managers of His money.
Here at Christian Financial Perspectives, Easter is an important holiday to us because it represents the resurrection of our Jesus Christ. Bob and Mary Jo wanted to offer some insight into the Easter story and how it relates to money.
In this episode, Bob and Mary Jo begin a series called “Biblical Viewpoints of Money and Wealth”. This topic was originally designed as a Bible Study and written by Bob Barber. The series is a deep dive into what God’s word has to say about money, so it is a perfect topic to cover here on Christian Financial Perspectives.
In finance, diversification is a process of allocating capital in a way that can reduce exposure to any single asset or risk. Bob and Mary Jo breakdown the principle of diversification and all of its different aspects and look at it from various perspectives.
Bob and Mary Jo present ways to create a “Family Money Legacy” for your children and/or grandchildren. A common goal for many parents and grandparents is for their children and grandchildren to learn how to master their God given resources, and not have money master them. It’s important to create a “Money Master” and not a “Money Monster”.
In Part 2 of our 2 part series “It’s All In The Family”, Bob and Mary Jo discuss the importance of having financial conversations with your spouse in a sensitive and productive way. Having these conversations is usually anything but easy. So, in order to better provide a simple way to begin these conversations, Bob and Mary Jo offer “10 Tips for Talking With Your Partner About Money”.
Talking about finances can be a taboo subject that is difficult to discuss. This difficulty is multiplied when it comes to discussing current financial situations and a financial future family members. In Part 1 of our 2 part series “It’s All In The Family”, Bob and Mary Jo discuss the importance of having these financial conversations with family members - specifically one’s parents and one’s children.
The one constant in this world is change. Change happens whether we are ready for it or not. You just left your current job and have moved on to a new company or maybe you are retiring. Are you wondering what to do with your old 401(k) or other type of company retirement plan?
January isn’t the only time to make positive changes! We all know how hard making changes and incorporating new habits can be, especially when it comes to finances. However, there’s no time like the present. When you develop a stewardship mentality, you are poised to go on an unforgettable adventure with God.
Here at Christian Financial Advisors, we get a lot of great questions on a daily basis from clients, and many of these questions are the one and the same. Bob and Mary Jo decided to record a program based on the most common questions that we receive as financial advisors.
In Part II of our series, Understanding Qualified Retirement Plans like IRA’s, Roth IRAs, 401k’s, 403b’s, SEP IRAs, SIMPLE IRAs and Required Minimum Distributions (RMDs). Bob & Mary Jo discuss the specifics and the rules associated with each type of plan.
Bob & Mary Jo discuss the history of retirement planning from social security to company pension plans as well as complete breakdowns of various retirement plans.
This week, Bob and Mary Jo interview a special guest and long time friend and Christian brother, Art Ally. Art is The Founder, President & CEO of The Timothy Plan Mutual Funds, a fund family categorized as a Biblically Responsible Investment (BRI).
This week, Bob and Mary Jo interview David Hart, the president of sales and marketing for eVALUEator services. eVALUEator is a tool for screening investments according to morally and biblically-responsible values. It is a tool for giving investors knowledge and the ability to be a good steward and stay away from various activities.
Would you take a road trip without a map or GPS? In this episode, Bob and Mary Jo cover the many reasons for needing financial planning. Financial planning is the process of wisely managing your finances so that you can achieve your dreams and goals – quite simply, a map to get you to the financial future you desire.
Many find themselves in a revolving cycle of of putting off financial matters that need to be done. Could you be in this cycle? Bob and Mary Jo talk about one of the main reasons for financial failure in almost every area of your finances - procrastination.
What are your financial goals and what have you done to help make them happen? This week, Bob and Mary Jo offer tips and advice that may give an extra advantage when it comes to fulfilling financial goals.
In this episode of Christian Financial Perspectives, Bob and Mary Jo discuss the joy of giving. Also joining Bob and Mary Jo is Ryan Assunto, the President of the National Christian Foundation Austin (NCF).
This week, Bob and Mary Jo discuss one of the most fascinating aspects of investing - how emotions and FEAR can control investment decisions. More often than not, investor’s behavior is fueled by emotions. As a result, they tend to buy high and sell low which is the exact opposite of what you want to do.
This episode discusses the good, the bad, and the ugly of annuities. Bob and Mary Jo cover what an annuity is and how they work in order to help you determine if an annuity is the right option for you.
We cover what we consider the top 25 items to examine when it comes to investing in stocks and bonds, which is just the tip of the iceberg. Investing is about so much more than the stock market, and there are many things to consider when investing.
With Black Friday and Cyber Monday looming around the corner, Bob and Mary Jo share tips for sticking to a budget when it comes to gift giving and money spending. They also touch on other year end topics including charitable gift giving, reviewing your tax situations, and maximizing your retirement plan contributions.
Have you created an income stream for retirement? This is something many of us worry about on a daily basis. In this episode, Bob and Mary Jo discuss different topics surrounding retirement income such as replacement income and how to avoid dipping into the principal of your investments early on, as well as the guidelines surrounding your Required Minimum Distribution (RMD).
Join Bob and Mary Jo as they talk about residential rental real estate, its pros, and its cons. From maintenance of a rental property to seasonal and vacation rentals, they go in depth to the many facets surrounding this secondary source of income.
Join us as we discuss 15 wealth management issues that are critical to the financial well being of most successful families. Not all of them will apply to every situation since every financial situation is unique and based on financial, social, and/or emotional needs.
In this episode of Christian Financial Perspectives, Bob and Mary Jo discuss “18 Income Tax Strategies for 2018” that may help lower your income taxes. They also supply a variety of Bible verses supporting paying your taxes, as well as verses on finance in general.
We discuss the 10 uses for money: - 4 DAILY uses - 6 SETTING LONG TERM GOALS uses
There is a lot to explore and consider. We are sharing guidelines and these guidelines can be interpreted in various ways that’s why we thought today’s message is so important.
Estate planning is a very important part of wealth management. In this episode, we are covering different techniques and tips that we recommend when it comes to creating an estate plan involving your family.
How do you choose a financial advisor? It’s not just about experience (although experience is important), but looking for a financial advisor encompasses a variety of areas including client relationships, truthfulness, openness, and if they are approaching your financial portfolio from a holistic perspective.
Biblically responsible investing (BRI) is a subset of impact investing (also known by faith based investing). How does it fit under this umbrella? BRI seeks to align itself with companies supporting conservative agendas. BRI avoids buying publicly traded companies directly, or indirectly through a mutual fund or separate account manager, that are known to violate Biblical principles.
What exactly are the scriptural guidelines when it comes to money and finances? As Christians and followers of Christ, we can probably all agree that the Bible is made up of God’s word, and God is the source of Biblical wisdom. Biblical wisdom is timeless, transcendent, accurate, universal, and practical.
The Bible has the best foundation for all of our money management principles and all of the basics for financial planning and how to create a financial wellness plan for you and your family. All we have to do is look for it, and it’s there! Scripture speaks on how to invest, how to handle money on a daily basis, paying taxes, and so much more. There really are very few people talking about this right now, and we are excited to be bringing this information to people all over the world through our Christian financial podcast.