10 Rules for Your Money

Psalm 119 2 reads, With my whole heart I seek you, let me not wander from your commandments. Does that apply to your money?

Hi, I'm Rob West. We must obey God's commandments, but many of the Bible's financial principles are really suggested rules that bring great blessing when followed. I'll talk about that first today, then it's on to your calls at 800-500.

That's 800-525-7000. This is MoneyWise Live, biblical wisdom for your financial goals. You've heard the saying rules were meant to be broken.

That's rarely, if ever, the case and certainly not when it comes to biblical financial principles. Break those rules and you're heading for trouble, debt, anxiety, and living paycheck to paycheck to name only a few. Now, why do we do it so often? I'd say it's about delayed gratification. Following the rules requires discipline that pays off later. On the other hand, when you break a rule, say by making an impulse purchase, it feels good for the moment, although it's almost always temporary. Of course, following the rules often takes much longer to realize the reward.

You don't see the benefit right away, but trust me, the day will come, probably many days, when you'll be glad you followed the rules. Have 10 of them for your money, all drawn from God's Word. The absolute most fundamental rule you must learn to follow is spend less than you earn. Everything hangs on that. Without it, you can't save for the future and you'll go into debt.

Proverbs 21-20 reads, And that leads to the next rule, and it's one we often forget about. Analyze your monthly bills. If you don't do this fairly regularly, you may not see costs creeping up in things like your phone or cable bill. Banking fees tend to sneak up, too. Call and request to have unwanted line items removed, and if they won't do it, cut the service or look for another provider.

You might not realize it, but sometimes a simple phone call can get a charge removed from a bill, or maybe even lower interest rates on your credit card. It never hurts to try, anyway. The next rule is another absolute for managing your money. Build an emergency fund. The alternative, again, is debt.

Things break and need repair. Unplanned expenses always come up, and you've got to have cash on hand to handle them. In Proverbs 6, 6-8, it reads, Go to the ant, consider her ways, and be wise.

Without any chief, officer, or ruler, she prepares her bread in the summer and gathers her food in harvest. Now, we talk about the next rule a lot, too. Avoid or eliminate high-interest debt. Use the snowball method to get rid of it quickly, paying off the smallest balance first, and so on.

The next rule? Save for retirement for the day when age or health prevents you from working. You can't rely on Social Security. It won't be enough to support you, so you have to put money in long-term investments.

That leads to the next rule. If your employer offers a 401K or 403B retirement plan with a matching contribution, squeeze every dime out of it that you can. Contribute enough to maximize your employer's contribution because it's free money. And if you don't have a retirement plan at work, open your own IRA. And here's another rule for your retirement savings.

Don't touch them. Far too many people these days tap into their retirement funds to pay off debts or for other reasons that really aren't emergencies. That's another reason why you need an emergency fund. So let your retirement earnings grow. As we like to say, your future self will thank you.

The next rule is one we might not talk about enough. Don't drive yourself to the poorhouse, as financial teacher Ron Blue likes to call it. That means buy cars for transportation only, not status. Consider reliability and fuel efficiency when buying a car.

The more reliable and the more fuel-efficient a car is, the less it will cost you down the road, pun intended. And finally, rule number 10. Remember to thank God for giving you everything you have, starting with his son Jesus Christ, your Savior and Lord. God is your provider. He's promised to provide for your every need, and he will. Prayers of thanksgiving will help you learn to be content with his provision.

Without God, we would have nothing. Hebrews 13 5 tells us, keep your life free from the love of money and be content with what you have, for he has said, I will never leave you nor forsake you. So those are 10 rules for managing your money.

Follow them and see how the Lord blesses you. Your calls are next, 800-525-7000. I'm Rob West, and this is MoneyWise Live. Thanks for joining us on MoneyWise Live.

I'm Rob West, your host. We started today by talking about 10 rules for managing your money God's way, and every one of those rules come right out of God's Word. We see those as principles that we can apply to our financial lives, and we recognize that as we steward God's resources, it begins with our beliefs. What is it we believe about money and its role in our life? What is our relationship with money? Well, the Bible articulates clearly how we should approach that.

It's not an end. It's a means to an end. It's a tool, and often our beliefs about money are shaped from our upbringing. Some of our earliest memories of money really relate to how we handle money even today, not to mention our experiences along the way and how God has wired us.

Well, all of that forms our beliefs, and perhaps those beliefs are aligned with Scripture, but maybe not. And if not, we need to make some adjustments in our belief system related to the use of God's money. Then we need to develop rhythms or behaviors around how we handle money on an ongoing basis. Those are rhythms of reflection, really expressing our gratitude, rhythms of managing God's money, the monthly in-and-out process of controlling our spending and making course corrections all along the way. There's the rhythm of planning, whether it's short-term planning or long-term planning, and aligning the use and goals that we have for God's money with our values, what's most important to us. Beyond that, there's the rhythm of communicating. And if we're married, communicating with our spouse about how we're handling God's money together as one flesh and what we're pursuing by using this tool to accomplish what we believe God has for us. But as we move from beliefs to our behaviors or our rhythms, ultimately, we then allow that to fuel our goals or our outcomes. Do we want to give more? Do we want to pay off debt? Do we want to save for the future?

Well, we'll never be able to do that as effectively if we don't start with getting our belief system right the way we think, getting our behaviors and rhythms in place around managing and planning and communicating and even reflecting on how we handle God's money, and then allowing all of that to help us pursue our God-given goals and objectives. Let's do that together today. What's your question or comment? We'd love to hear from you. We've got some lines open. Here's the number, 800-525-7000. That's 800-525-7000.

We'll begin today in Chicago, Illinois. Hi, John. How can I help you, sir?

Hi, Rob. My question is, should we move our retirement assets from traditional IRAs to Roths? And I've got some details if you'd like on that.

Yeah, I would. Tell me about your age and kind of your proximity to retirement, those types of things. I'm 69. My wife is 63.

We're both retired. All right. And what do you have in traditional IRAs today?

About 5 million. Okay. And the majority of it's in traditional IRAs. A little bit's in annuities and a little bit's in a 403b. Okay. And why is it you're thinking you'd like to consider moving to a Roth? What is it you're trying to accomplish? Well, we've been, of course, approached by another organization, and their recommendation is that when I turn 70 and a half and have to start taking distributions, and my wife starts taking distributions, our taxes, we're going to jump into such a high tax bracket that by paying the tax now and trying to get a little more growth, we're about 50% in stocks, 50% in bonds, we can actually end up with more money down the road. Yeah.

I'd love for you to get a second opinion on that. I mean, a couple of thoughts. Number one is the required minimum distribution is not going to happen until you're 72 now, so that's changed from 70 and a half. Secondly, I think as you look at this, I mean, yes, you're going to be adding to your taxable income when you take that RMD each year by increasing by the amount that you pull out, but that's not nearly as much as you're going to be adding in the years that you convert these large sums, arguably, of money over to the Roth where it will all be taxable at that point. And given what's expected in the relatively near term with a market that's got very high valuations, we're expecting some choppiness ahead, stocks are still, for a portion of your portfolio, absolutely the place to be, especially with what we're seeing in inflation. So I don't want you in cash, but I don't think we're going to see the kinds of returns we've seen in the last couple of years or even the last decade.

I think they're going to be more tempered or modest. And when you add the 50% in bonds, which are going to not do quite as well as rates head higher in the near term, I'm just wondering the wisdom of paying all that tax now, not getting the benefit of where the Roth really is most effective. And that is when you have a really growth focused portfolio that can grow over a long period of time during your working years.

And that's just not your situation today. You couple that with some of the opportunities on how you could take these RMDs and through a qualified charitable distribution, get them into the hands of ministries that you want to support. Perhaps you were going to support anyway out of cash, satisfy that RMD and also reduce your adjusted gross income at the same time. I think employing that strategy coupled with the idea that we still have some time, three years for you and quite a bit more, nine years for your wife before you'd even need to take these RMDs. And taking that huge tax bite today, I'm just not seeing necessarily the automatic win for you on that. Does that make sense?

Yes, it does. How would I get a second opinion on this? Right now the money is managed by one of the big money mutual fund companies. And they just don't give this kind of advice like the smaller local company does.

Sure, yeah. And you probably won't hear, if this is not an advisor who understands your biblical worldview and approach to money, they probably won't focus on the generosity opportunities as well, which if you're giving significant amount of money, you could very easily satisfy that RMD through, as I said, the qualified charitable distribution, not count that in your adjusted gross income and have a real win for not only you, but also for the ministry you're supporting. So what I would do, John, is connect with a couple of certified kingdom advisors there in Chicago.

There's some wonderful ones. I'd interview two or three, run this by them, get their ideas. And then kind of once you have some other people speaking into this that not only have significant competence and experience, but also God's perspective of handling his money, I think perhaps the Lord will make it clear the direction you should go.

And I'd love to weigh in again along the way as you get more information. The way you do that is just head to our website, MoneyWiseLive.org, click Find a CKA, that stands for Certified Kingdom Advisor. These are people who have held and met high standards with regard to experience and character and regulatory reviews, pastor and client references, but they've also been trained to be specialists in biblically wise financial counsel at a professional level. So again, MoneyWiseLive.org, click Find a CKA, and we appreciate your call today very, very much. You know, folks, as we think about handling God's money, it's important that we get wise counsel.

The Bible is certainly clear on that, that we need to have others speaking into this area of our lives. That's why I love talking to you each afternoon on this program, but also as we connect with the MoneyWise coaches, and that's why we are so excited about the work of our Certified Kingdom Advisors, now more than 1300 of them all over the country. Together, we can be effective stewards with God's money.

Stay with us. MoneyWiseLive will return. Thanks for tuning into MoneyWise Live. You know, we created the MoneyWise app specifically for the MoneyWise community because I couldn't find a money management system that really met the needs that I had, whereas Julie and I were trying to manage our money. We wanted a system that could employ the latest technology that had a beautiful user interface that downloaded our transactions, where we could use the digital envelope system in a way that was simple and easy to use. Well, we hired a team of developers that actually spent well over a year building it, and it is the very best money management system I've ever used. Add to that all the content and the community where folks like you can encourage one another, ask questions.

Our coaches are answering those questions all the time. The podcast, the articles, it's all there, and I'd love for you to check it out today. You can visit your app store and search for MoneyWise Biblical Finance. You can download it today. And right now, we have a very special limited time offer for you to become a pro subscriber, which just means you can download all of your transactions, connect to more than 11,000 institutions, develop custom envelopes for your spending plan. There's also a web app if you'd rather do it all online. And if you want to learn more about that special offer that's going on right now at a discounted rate, just check out moneywise.org slash pro.

That's moneywise.org slash pro, and you can learn more today. All right, let's head back to the phones. We've got three lines open. 800-525-7000.

Clem is in St. Louis, Missouri. Hi there. Hi, how are you? Very well, thanks. Appreciate your call. Thank you.

I enjoyed the show. I have a question about 401k. So I wanted to know what the benefit of, so I don't have it where I have it fully, stocks, you know, the stocks. I don't even know how to word it, but I have like half. Would half be in bonds, maybe, and the other half in stocks? Is that what you think? Well, half is just stable, and the rest is not, because it fluctuates up and down, because I had like a $4,000 loss one time, and so I decided that I wanted to do that. So I wanted to know if that was the right choice.

Yes. Tell me your age, Clem. Sixty-two. Okay, and how long do you plan to continue to work? Until retirement. Okay, and just based on what you know today, how long do you think that might be? Probably about 65. Okay, so another three years, maybe a little more than that.

All right, very good. Well, you know, there is an old rule of thumb, and that's all it is, but we used to call it the rule of 100. Because people are living longer, that rule of 100 is now a rule of 110, but here's how it works. You take 110, and you subtract your age, and the resulting number is the percentage of your portfolio that you might want to consider having in stocks. Whereas the other portion, whatever's left over that makes up the rest of the portfolio, would be in what you might call this more stable account, usually a mix of bonds and other types of cash type instruments.

So in your case, if you take 110 minus 62, that means you'd come out with 48, which is essentially what you have right now. About 50%, I think you said, of your portfolio is in stocks, about 50% in the more stable type investments. That's probably about right in the sense that you don't have 10 years or more for this to grow. If we were to hit a speed bump along the way, let's say 18 months from now we're hitting a recession here in the United States, I don't know whether we will or not. The economy's still very strong right now despite some headwinds, but could we? Sure, the market and the economy is cyclical, and we've been on a raging and very strong economy and stock market for well over a decade now.

So that's not out of the question. The positioning that you would be in with half of your money in stocks and the other half in bonds would be such that you wouldn't take the full brunt of the downside. So if the market was down, let's say 30%, your portfolio might only be down half that. And if you even retired and needed to start drawing an income, you could take that half in stocks and leave it alone.

Not sell any, not pull any of that out, hold those investments and let them recover, which historically speaking they always do. And so you'd have half of your portfolio that would be more stable, and that would be the portion you would use during that period where the market was down to fund whatever income you need. So I think you're probably positioned about right. The question would be, are you in the right stock investments inside the 401k, and are you in the right stable investments? And if you wanted a second opinion on that, you could connect with an advisor or see if there's somebody with the plan administrator that would give you some counsel.

But I think at a high level, you're probably positioned correctly. The big question for you, I think right now, Clem, is what does your budget look like in that season? How much do you think you'll need to spend to cover your lifestyle? Hopefully when you enter retirement, you're debt-free. You won't be saving any longer for the future, at least perhaps as much as you are right now into the 401k. So that reduces your overall spending.

What other expenses might come off such that you could establish a budget, and then based on Social Security and a reasonable amount you might pull off of this 401k and whatever it grows to over the next three or four years, hopefully, Lord willing, that would cover your lifestyle need, and then you could see what God has for you in the next season. Does all that make sense, though? Oh yeah, that sounds great to me. Okay, good. Listen, if you want some help along the way with this, don't hesitate to reach out to one of our Certified Kingdom Advisors just to kind of run everything you're doing by that professional, just to see if there's any other thoughts perhaps that you may not have considered.

But it sounds like you're on the right track, and I'd love for you to check back in with us as you get closer, okay? I will. Thank you so much. Appreciate it. All right. God bless you very much. We appreciate your call today. Well, folks, in just a second, we're going to head to a quick break. We do got some lines open. I would love to hear from you.

800-525-7000 is the number to call. Before we head into that break, let me just remind you, MoneyWise Live and MoneyWise Media are entirely listener supported. We do what we do every day on the air and through our coaches and CKAs and the MoneyWise app because of your generous support. So if you consider yourself a part of the MoneyWise community and you benefit from this program regularly, we would invite you to be a donor, a supporter of this ministry beyond the giving to your local church. It's quick and easy, and we could certainly use it as we head toward the end of the year. Just head to MoneyWiseLive.org and click the donate button.

That's MoneyWiseLive.org and click donate. We would certainly be grateful. Phone lines are open.

800-525-7000. Stay with us. We're so thankful to have you along with us today. I'm Rob West. Each afternoon we have the chance to come together and think about our role as managing money for the King of Kings.

That's right. We've been entrusted to handle his resources. We're called stewards and we're to be found faithful, and I think we can do that best together. So let's head right back to the phones today and see who we can talk to. We're going to be in just a moment with Michelle in Chicago. Debbie's been patiently waiting in Trenton to talk about tithing on Social Security. That should be fun.

But next, let's go to Ohio. Hi, Brian. I understand you have a credit card question.

Yes, thank you. I basically need some advice on how to deal with a fairly large credit card bill. Say $20-25,000. Paying interest on that minimum payment is just not paying it off. Any recommendations on what to do to reduce interest and then try to pay it down. Yes. Well, I do have some thoughts on that, Brian.

I appreciate your call. You know, the first question I would always have when we're talking about paying off credit card is not how do we pay it off. We'll get to that. But have we solved kind of the underlying issue that led to the credit card debt in the first place? You know, in some cases it was because of something unforeseen out of left field, a medically related or loss of a job.

In other cases, it's just simply a consumptive lifestyle. We're spending beyond our means and if we don't correct that, any attempt to pay off the debt is going to result in the debt returning over time. So talk to me about that piece of it and do you feel like you've corrected that? Well, actually, it's not my bill. I'm kind of calling for someone else. But I feel that that situation is under control. It's just something that was kind of ignored for many years and suddenly it's like, oh, it's a huge bill now. How do we fix this?

Sure. Well, I would just say last thing, last thought on that piece of it. I would just say as you help this individual thinking through how to pay it off, I would not just assume that that has been resolved because as this pressure begins to come off, if we haven't put the, you know, corrected the belief system and changed the rhythms on how they're managing their finances and, you know, dialed into a spending plan and having a system to control the flow of money in and out. I guarantee you, it's only a matter of time before the debt returns and I certainly want to make sure we've dealt with the issue and not the symptom. In terms of how to pay it off, you know, we're talking about a sum of this amount, you know, $20,000 plus. I really like credit counseling. And basically, this is where you would go into a nonprofit credit counseling program. The card would be closed and the card would be entered into the credit counseling program, which means they would get automatically the reduced interest rate that that particular credit card company or companies offer through credit counseling. So when a nonprofit debt management program enrolls someone, they then contact the creditors, they will tell them and they already know, they have this listing that's made available regularly, what the rate will be reduced to, and then they will establish one monthly fixed payment that will fit into their budget, that they will be paid to the credit counseling agency and then passed on to the creditor. And the combination of that fixed monthly payment, not one that goes down as the balance comes down, but a static payment combined with the reduced interest rate in credit counseling allows that debt to be paid off 80% faster on average. So that's my preferred way. It's not factored into the credit scoring algorithm, although it will be referenced on the report that it's been closed due to debt management.

A prospective lender could choose to use that information however they want. But in my estimation, the main objective is getting the debt paid off, not seeking new credit anyway. So that's not really my primary concern. But talk to me about your thoughts on that approach. No, that sounds like a good direction.

Okay. So the next step would be to direct them to Christian credit counselors. This is our preferred vendor. They've been doing this for 30 years. They've helped thousands and thousands and thousands of families pay off their credit card debt. They're believers. They will work very effectively over the phone with this individual, pray with them, talk through what they're dealing with, help them work up a budget, but also get them, if it makes sense, and in just about every case that does, enrolled in the program, get the interest rates reduced, establish a monthly payment, and then they're kind of off to the races. And the good news is that now they know every time they're making a payment, it's really going to be going to the principal in a way that's going to reduce the balance in a meaningful way over time. So direct them to the website, christiancreditcounselors.org, Brian, and let us know how it goes. We appreciate your call.

To Trenton, Georgia. Hi, Debbie. How can I help you? Yes.

Good afternoon. My question is, after one hits on Social Security, are we the ties off of it? Yeah, it's a great question, you know, and this is one we get fairly often. You know, as you think about Social Security, I mean, first of all, you know, it's perhaps possible to distinguish the after-tie the amount you contributed to your personal retirement savings, and then the increase from the yet-to-be-tied investment gains. But it would be much more difficult to do that math with Social Security, just because determining how much was what you put in versus how much was increases over time is going to be very difficult, nearly impossible.

And besides, unless you were self-employed during your entire working years, it wasn't just you who contributed to Social Security, your employer did as well. They contributed a portion also. So I just think my approach to all of this, Debbie, if we're wanting to be found faithful, and clearly you are, that's why you're calling today, you know, if we're going to apply the principle of the tithe, and it's a legitimate question to ask, so I'm not minimizing that at all, I just take the approach that we don't try to drill down and estimate how much is increase and how much is a return of capital. You know, in the farming economy of the biblical times, they didn't subtract the amount of wheat they had planted in computing the tithe.

They tithed on the whole increase. So I just would see it as a gracious gift from the Lord, regardless of what I've put in, and I think as you give faithfully on God's increase from whatever source, whether that's Social Security or, you know, your investment returns or, you know, gifts that come your way, a pension, whatever it is, your expression of your gratitude and trust in the Lord for that provision by returning a tenth as a tithe, I think is just a great act of worship and obedience. So for me, I would take that approach as you think about giving on your tithe. Doesn't mean that's necessarily the right way for you. This is not about being legalistic. It's about you giving joyfully and cheerfully to the Lord.

So at the end of the day, I think you should, you know, pray about it, talk to your husband about it, make a decision, but that's just my perspective on it. Does all that make sense, though? Yes, it does. Thank you. Okay, very good. We appreciate your call and thanks for asking the question today.

Chicago, Illinois. Hi, Michelle. What can I do for you? Hi, thank you for taking my call.

Sure. My company offers a legal and identity theft protection services that you can have taken out biweekly out of your check, which totals about $182 for the year for these services. I'm looking mainly to use them for the legal aspect of creating a simple revocable living trust, power of attorneys and other paperwork that would be required to get my house in order. Also, my young adult college student would also qualify because he's under the age of 26. So I'm thinking of using it for not just myself, but for him as well. Yeah.

Yeah. You know, I think that can be an effective resource. You know, it's going to be discounted because it's offered on an employee wide basis.

And as long as you have a specific purpose in mind for it, you know, and you need a simple will or a trust, you know, that should be able to be handled very effectively and probably very cost effectively as well as a part of your employee benefit. So I'd say you go for it. Now, after that's done, whether you'd continue with it is just whether or not you want those ongoing services. Hang on the line.

We'll talk more off the air and we'll be right back. Thanks for tuning in to Money Wise Live, biblical wisdom for your financial decisions. Find out what most effectively hits where your needs are so you can then read on or listen further to grow in your understanding of handling God's money. We call it Money Wise Weekly Wisdom and the quickest and easiest way for you to ensure that you're going to get a copy when it goes out tomorrow is for you to head to our website. MoneyWiseLive.org. Just create a free account when you sign up that will make sure that you get our weekly wisdom. It will also give you an account to post to our Money Wise community where coaches are answering your questions and much more. Again, the Web address MoneyWiseLive.org.

All right. We've got room for a couple more questions. If you've got a question today on anything financial, we'd love to hear from you. Here's the number 800-525-7000. Let's head back to the phones.

Mark is in Kenosha, Wisconsin. And Mark, how can I help you? Thank you so much for taking my call. Your ministry is a blessing.

Thank you, sir. So I've been putting most of my or all of my retirement investments are in a Roth 401K through my employer. And now toward the end of the year, I'm thinking to myself, I need to maybe prevent a little bit of tax burden.

And I have a fair amount of cash saved up. I was wondering if I would be permitted to invest in a traditional Roth outside of my employer. Yes, you can. Well, I think you're talking about a traditional IRA. And you can do both the 401K and the IRA, subject to just a few limitations related to income and so forth. But that may be the way to go is either to, if you have a traditional 401K option, you could stop contributing to the Roth for the year and put some money into the traditional 401K.

Although that's going to come out, it has to come out of salary deferral, and you may want to do more than you can do in the remaining pay periods of the year. So the other option would be open a traditional IRA outside of your place of business. And you contribute if you're over 50, you could put in 7000 for the year. And, you know, that would give you some funds that you could then deduct against this year's taxable income. So I'd probably check with your tax preparer, CPA or accountant just to see exactly how you can maximize the benefit of that contribution, what amount they would suggest you put in to minimize your tax burden. But you definitely can have both, both the Roth 401K and also that traditional IRA. You can open that at Charles Schwab or Betterment or, you know, perhaps Vanguard, any one of the low cost, high quality providers.

And if you're looking for a simple, inexpensive way to have those funds invested, I'd probably look to one of the robo advisors, the Schwab intelligent portfolios, Betterment, the Vanguard advisor, where through an algorithm, they would build you based on your age and objectives, a low cost indexed ETF portfolio, which are just indexes of the broad market, averages, both stocks and bonds, depending on your age, it'd be very low cost, and you just kind of capture the broad moves of the market. But to your point, it would give you the deduction in the current year to reduce your taxes. So I check with your tax preparer or accountant, but then assuming they're on board with it and tell you the amount to put in, you can open that traditional IRA and be on your way. We appreciate your call today. We'll head to The Villages, Florida. Hi, Pat, how can I help you? Hi, Rob, thanks for taking my call. The reason I'm calling is my husband and I tied, we don't have any debt, and we live on our social security and some relatively small pensions. My husband wants to get a reverse mortgage.

And I don't know much about it. He takes care of all the money management. The reason he wants to get a reverse mortgage is because of if any, like an emergency comes about, we'll have money. And so I'm looking for your advice in this regard. Yeah, you know, I don't have an automatic problem with reverse mortgages. I mean, some people will just say you absolutely need to stay away.

I wouldn't be in that camp. I mean, it's a way to turn this asset that you have, your home, into an income stream. You want to stay in the home. You have enough income to maintain the taxes and the insurance and keep the property up. But you want to tap into some of that equity in the form of a supplemental income stream to supplement your income in retirement. The reason I don't typically recommend them and they're not my first choice is I just don't like to fund lifestyle with debt.

And that's what essentially this is. And they tend to be, you know, the fees are somewhat higher with reverse mortgages than even a conventional mortgage. The kind of imputed interest rate is a little bit higher.

And so they tend to be a little expensive. It also makes it slightly more complicated if you're going to pass this on to your heirs because they would have to satisfy the reverse mortgage balance if they wanted to retain the property. But if it's going to be sold anyway, you would just be passing on the net proceeds of the home sale price minus the reverse mortgage balance. So I think the key question is, you know, do you have your budget defined for this season of life? What income sources do you have?

Are there other ways to solve for any shortfalls in income that is needed for maintaining your lifestyle, including downsizing and selling the home, buying something smaller that's easier to maintain and less costly? Or if you just absolutely believe this is the place to stay, you're just short a little bit and you feel like tapping into the home equity in the form of reverse mortgage could get that done. You know, I wouldn't say that's the worst thing in the world. It's just not my first choice. Does that make sense, though? It makes sense. But your first choice would be if we are going to do anything rather than a... I mean, we stay pretty close to our budget.

We don't live frivolously at all. So why the reverse mortgage? Just for a little padding, a little extra income? Yeah. My husband feels that if we had some emergency come up, we'd have the money. Yeah.

Yeah. I mean, I guess you could do that and just take a minimal amount. I would love for you just to find another way to do that, if at all possible, and keep your home where you own it free and clear without all the expense associated with adding a reverse mortgage.

Not only the fees but the interest rate, and then you're accruing and building this reverse mortgage balance over time. If you could do that by either simplifying your lifestyle, downsizing, and I realize that's a major decision, bigger than just the financial side because this is your home. So you'd need to think through that.

I guess I would just ask that question. Are there other ways to do this? If you're able to cover your expenses, this is just for something extra. That seems like a pretty costly way to just add a little surplus to the monthly spending when you take on a reverse mortgage. Perhaps you'd connect with one of our MoneyWise coaches who could just help you work through your budget, see if there's any other opportunities before you make a decision like this. I think that might be wise. You could head to our website, MoneyWiseLive.org, click the Community tab, and then click Connect with a Coach, and our coaches could help look over your situation.

I think I would probably look for some other options first, given that everything I've heard and that your budget actually balances today, you're just looking for a little bit more surplus. We appreciate your call today. Thanks for listening. Aaron is in St. Louis, Missouri. Hi Aaron, how can I help you?

Hi, yes. I would like to know if there's any IRA account that the IRS finds it hard to confiscate? Politicians say a lot of things that never come to pass. Here's my perspective, Aaron, is that it's highly unlikely that any legislation that would make its way through Congress and the President and ultimately the Supreme Court to do away with qualified retirement plans would ever survive. And so I would just say the answer is no. If you're wanting to take advantage of savings accounts, whether it's in your bank or qualified retirement accounts, you are going to be a part of ERISA and you will be under the banking system here in the United States.

And so depending upon what your concern is, I don't think you can avoid that. And I don't like the idea at all of kind of pulling out of the system altogether and keeping large sums of cash in your home, not just for the physical security side of it, but just you're going to be losing purchasing power every month that passes, especially given the rise in inflation. So I would say ultimately our trust should be placed in the Lord. We have a very strong economy here in the United States and anything backed by the full faith and credit of the United States I believe is someplace that we should have some confidence in, especially given the alternatives around the world. So I would stick with your current plan, if it were me, in terms of being prudent and wise in managing God's money with diversified portfolios, using the banking system and using tax-deferred retirement accounts for your long-term savings.

That's just me. At the end of the day, you're the steward of God's money, so you've got to pray through that, but that's at least my perspective. All right, we're going to finish today in Spokane, Washington. I'm going to read Tom's question because we are short on time. He is earning minimal income. He just wants to know some advice on how to manage money wisely.

And here's what I would say, Tom. It comes down to five things. We've got to spend less than we earn.

That is essential. We've got to set term goals. We've got to minimize the use of debt. We've got to have some margin in our financial life. When we live below our means, we have surplus that we can use toward debt reduction, savings, and then we need to give generously. And when we do those five things, we put ourselves in a position to experience God's best. So live within your means, avoid the use of debt, set some long-term goals, have margin or savings in your financial life, and give generously. We appreciate your call today.

MoneyWise Live is a partnership between Moody Radio and MoneyWise Media. Thank you to Jim, Hans, Amy, and Deb. Couldn't do it without them. Thank you for being here as well. Hope you'll come back and join us tomorrow. God bless you. Bye-bye.