Financial Advice for Students and Early Career Adults with Bob Doll

This faith and finance podcast is underwritten in part by Crossmark Global Investments, a faith-based firm offering values-based investing options. They seek to help investors align their financial choices with their beliefs, ensuring their portfolio reflects what matters most.

Find out more at crossmark.com. Today, Bob Doll joins us to share some practical financial advice to help young adults start their career on the right foot, and then it's on to your calls at 800-525-7000. This is faith and finance, biblical wisdom for your financial journey. Well, it's always a pleasure to have my friend Bob Doll with us. Bob is the CEO and Chief Investment Officer at Crossmark Global Investments, an underwriter of this program. He also sits on the Board of Directors of Kingdom Advisors, and he's a regular contributor here. Bob, great to have you.

Thanks for including me in this session. Bob, you manage investments worth billions, so it seems like you might know a thing or two about making the right financial decisions, and that's what I want to talk about today, and specifically about students and young adults. So what decisions should students and young adults starting their careers make right now to get them on a solid financial footing? Well, as like so many things in life, Rob, have a plan. You aim at nothing, you're sure to achieve it, as they say, but creating and sticking to a budget for both income and expenses is the starting point, and as you know better than me, FaithFi has a really good app to make that happen. Once you get started on that, then you want to think about an emergency fund for the tough times in life.

General suggestions are three to six months of expenses, and needless to say, Rob, I don't believe I have to say it, avoid debt, credit card debt, especially with those high interest rates when you pay off your credit card immediately, when you focus on paying down your student loans, you're going to be far better off. Oh, that is so good. Yeah, compounding is a very powerful force. It can work for you or against you. The against you happens when you have a lot of credit card debt for sure.

So we want to certainly avoid that. Now, unfortunately, Bob, as you well know, not everyone follows that advice. So how can we learn from others' financial mistakes and then make wiser choices? Again, like so many things in life, just observe what other people are doing, those that are having success in this area and those who are struggling. Most of us need a mentor for various pieces of life, and for a lot of people, that's a great way to get going on your finances. A financial advisor can give you the guidance that you really need to get the job done well here. Make sure that you keep aware of and constantly check yourself for the common pitfalls in this area of life, and that is overspending.

You can get in trouble real fast there and get into a vicious spiral. Or not saving. Don't just spend everything you have. You've got to have a savings program. Listen to this program. Reading good books on the subject. I come back to follow the people that are going to make a difference for you.

People will be very willing to help, and Faithfi has great content in its app on this subject as well. Yeah. Bob, let's get personal for a second. Any mistakes you made early on that you could share with our listeners?

Yeah, not paying attention to it all. We, thankfully, my wife and I didn't have a conspicuous consumption problem, as many did. We actually dishonored the Lord by putting too much money in barns. We saved a lot of money. I was busy on Wall Street, Leslie was busy raising our kids, and a lot of money accumulated that God had better uses for. We woke up to that and became more generous givers.

I love that. Bob, obviously starting early is key, and we're talking to students and young adults. I mean, the power of being able to put aside even a little bit consistently, especially when it's invested, it's a powerful force, isn't it? It is, both that you're having the regular savings program for investment, but as you mentioned earlier, the beauty of compound interest.

It can add up fast, and what you think's a little bit can become a whole lot more as the years go by. Yeah, and it's important to be consistent, what we call dollar-cost averaging, and don't worry about the market. The secret is, when the market's down, you buy more shares with the same amount of money, right? That's the beauty of dollar-cost averaging.

It does work. We're talking to Bob Doll today, our good friend. He's CEO and Chief Investment Officer at Crossmark Global Investments, an underwriter of this program and a real leader in the area of faith-based investing.

Today, some sage advice for young adults, those just getting started in their early careers. You're not going to want to miss what Bob has to share right around the corner. He's been there, done that. He'll have more for you. Following this interview, your questions today at 800-525-7000.

We'll be back with more after this. Explore and reflect on a well-known biblical parable about a very rich man with a very big problem. Purchase your copy of The Rich Toward God Study or place a bulk order today at faithbuy.com slash shop. We are grateful for support from Crossmark Global Investments. They are a faith-based firm with a goal of offering values-based investments to help align financial choices and faith, ensuring a portfolio that reflects what matters most.

Crossmark does this through investment solutions that span the capital market spectrum from large cap to small cap strategies, including equity, fixed income and balanced strategies. They are led by industry veteran Bob Doll, CFA, a regular guest on the faith and finance program. More information is available at crossmarkglobal.com. I'm so thankful you've joined us today for faith and finance. I'm Rob West with me today, frequent contributor and good friend Bob Doll. He's CEO and Chief Investment Officer at Crossmark Global Investments, an underwriter of this program.

You can learn more at crossmarkglobal.com. Bob and his wife Leslie have mentored countless individuals in a whole host of areas, but certainly in the area of financial stewardship. And we're talking today about specifically young adults, those who are students or early in their career, getting started on a solid financial footing. And Bob, that's not only the financial literacy, the blocking and tackling, but also deepening your understanding of God's heart as it relates to money because there is a lot in scripture on this topic, right? Starting with the fact that it's not our money. You know, one of the big pitfalls people, well, this is my money. I can do with it what I want.

No, no, no, no. Like everything in life, including our bodies, our brains, our time, it's all on loan to us from God and we're to be good stewards. And that starts with our money. Yeah, that's well said. Bob, you mentioned that one of the things we should do to deepen our understanding of biblical money management is not only to look for guidance and perhaps a mentor, but be a reader, actively seek out great content on this topic.

And of course, Faithfy is here for that. But what are a couple of books that really shaped your thinking beyond God's word? I point to Randy Alcorn, A-L-C-O-R-N, if people don't know who he is. Randy's written so many books on the treasure principle, for example, is one of them. But any of Randy's books on this subject can help anybody wherever they are, starting point or well advanced in the savings giving money process.

Yeah, I couldn't agree more. You know, beyond God's word, probably the book that shaped my thinking most significantly in this topic was Money, Possessions and Eternity from Randy Alcorn, for sure. I taught a Sunday School in class on that and had a great time.

Oh, I bet. It's a little bit of a thicker read, so you got to commit some time, but it's well worth it. By the way, that's the book we send to every new certified kingdom advisor when they earn the designation.

That's how much we think of that book. Bob, you mentioned before the break that one of the things you and Leslie learned was it wasn't about spending frivolously, necessarily, or incurring a lot of credit card debt. It was as you were working hard building your career on Wall Street, how much you were stocking away in bigger barns. And the opportunity that you missed to give generously, which you and Leslie are now really thoughtful about, what would you say to 20-year-old Bob about generosity and giving?

What counsel would you give to perhaps lean into that early and not miss that? You know, to get started, to be generous, you know, I love the line, God prospers us not necessarily to increase our standard of living, but our standard of giving. And while we didn't spend more as we earned more, we saved them. We should have wished Bob at 20 years old would have given more away.

Talk to people in your business that are older, that may have the same income patterns as you do. What did they do? What did they learn?

This is the way to mature faster than your years on this subject. Yeah, and obviously there's a tension there, and I think that's a good thing. I mean, it'd be one thing if God's Word said, well, yeah, you're supposed to live on 78.6% of your income and give the rest away.

It doesn't, but that requires that we get on our knees and really have this conversation, especially if we're married, between our spouse and ourselves and the Lord, right? Well said. And there's seasons of life.

You know, a student that is working hard to graduate from college may not have a job. And so there are different standards for that person than when somebody starts working, when someone moves up the ladder a bit. So there's seasons in life. God knows that. He understands that.

And just, like you say, get on your knees and you'll help figure it out. What happens in your heart and in your marriage when you prioritize giving, even in those early days where budgets are tight and we don't have a lot of net worth? Immediately what comes to mind, Rob, is it is more blessed to give than receive. I know from some of the things we've done over time that where we did extend ourselves, God blessed big time in the heart, you know, the joy that comes from it. Give it a try.

Yeah. Bob, let's talk about investing for those who are students and early in their career. Obviously, you've had a long tenure on Wall Street, managing billions of dollars. We can see you on CNBC and Fox Business. But, you know, for those who are just getting started, what would you say to them about where to begin on their investment journey?

You already said it. Get started. The sooner you start, the better off you're going to be. So what do you start with? You might want to have a financial advisor who can help direct you, maybe part of a family book if you have parents that are doing that sort of thing or friends. People often start with very simple low-cost index funds in order to get the job done. Make sure what you're trying to invest lines up with your long-term goals. If you need this money for college next year, you're going to have a different attitude than if you're saving for retirement. What would you have them know about the opportunity that frankly didn't exist anywhere near the same way when you and I were just starting out, but the opportunity to align their values with their investments? Yeah, the opportunity to say, look, I'm going to invest in a way that's consistent with God's word and consistent with the way I manage the rest of my life. You're not going to take a knife and stab somebody in the back.

Why would you invest in companies that make products that kill people? A thoughtful process, as Rob hinted, the values-based, faith-based side of money management is still small, but it's growing quickly. Get yourself aligned to that.

Figure that out. Of course, I should have said this to your first question, Rob. Taking advantage of employer-sponsored programs, whether it's a retirement program, matching contributions, don't neglect that quote-free money. Yeah, and then beyond that, the power of the Roth IRA for that 20-year-old over the next 45 years is incredible, isn't it? It really is, and not to mention, like we said before, the compounding factor is amazing. Some have called compounding the eighth wonder of the world.

Yeah. Bob, what about just rhythms and disciplines, sticking to our financial goals even when progress is slow? It can seem that the journey is so long, maybe I give up and just enjoy too much of it now.

What would you say to our listeners? You have to have balance like in everything in life. God wants us to enjoy things, so we don't have to be sitting as a monk in the corner not spending any money, but at the same time, we want to be able to have a bright future.

We don't know what the future brings, but we do know if we try to take care of things, including money, according to God's principles, we're probably better off than we would be if we ignored all that. So set some goals, set some milestones. Have a celebration when you hit a certain goal. It's always really good.

Bob, just about 40 seconds left. For those who are just starting out, a new family, a young marriage, what would you say about communication around money specifically with your spouse? Because we're two different people, aren't we?

We sure are, and there are a lot of studies that show too many divorces come because of disagreement with money. So the key is to communicate with each other, repeat, get on your knees together on this subject. Set some goals. If you have some goals and you're on the same page with that, you can track it pretty carefully.

I love it. Well, Bob, we could talk about this for days, but I really appreciate the nuggets of wisdom you've shared with those listening today who are students early in their careers. Start strong, get into God's word and heed Bob's counsel today.

Thanks for being with us, my friend. My privilege. That's Bob Dawley, CEO and Chief Investment Officer at Crossmark Global Investments, a leader in faith-based investing and an underwriter of this program.

Learn more at crossmarkglobal.com. All right, your calls are next. The number, 800-525-7000.

That's 800-525-7000. I'm Rob West and this is Faith and Finance, biblical wisdom for your financial journey. We'll be right back. If you enjoy this radio program, you're going to love all of the many different resources waiting for you at faithfi.com and the Faithfi app. You'll find powerful wisdom, free podcasts, articles, videos, and more from leading voices such as Randy Alcorn, Howard Dayton, Ron Blue, and our own Rob West. Grow in wisdom and knowledge by connecting with a community of thousands of Christians striving to be good and faithful stewards at faithfi.com or by downloading the Faithfi app.

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This institution is not federally insured. Hey, great to have you with us today on Faith and Finance. By the way, if you found some value in the program, maybe you've taken something away that's been helpful or it's caused you to think a little differently about your role in managing God's money, and you'd like to get back to the ministry or help us reach more people with this message of biblical stewardship, we'd invite you to become a Faithfi partner.

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It'll be out next month, the new edition of Faithful Steward and issue two is chock full of great content. How do you respond as a Christian when someone owes you money? What about crafting a legacy through an intentional inheritance? Is it okay to leave different amounts to my kids? How do temperaments affect financial decision making?

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Thanks in advance. Elaine, you've been waiting patiently there in Maryland. Go ahead. Bless your heart, Rob. I'm so grateful for your show.

Thank you. I'm 70 years old, single, still working, planning on retiring next year. And my question is, what do I do with this large amount of money that I have accrued in my checking account? It's $112,000. I just haven't decided what to do with it. I have, other than that, I have $194,000 total between my two IRA accounts, stocks and a brokerage account. And then I was, you know, I have a 2004 car with over 310,000 miles.

That's going to die soon. So I'll need another car and my house needs a lot of work. And I thought, well, wait a minute, I'm paying my mortgage. It's $1,000 a month.

It's 110,000 balance at 4.375%. Okay. All right. So I'm not sure if I should, you know, go with them paying off the mortgage or what? Yeah.

Great questions. Boy, that's, that's really helpful background. So Elaine, as you said, you're about a year or so away from retirement, correct? Well, I wanted to retire this year, but I started to get my social security in January when I turned 70 and it's $4,000 a month. And I'm like, Ooh, you know, I could, I could save that, you know, for work on the house or something.

I love that. Now, have you done your retirement budget to figure out what your monthly expenses are going to look like when you finally do get to retirement and recognizing some expenses may decline slightly? Well, you know, someone asked me, Oh, well, when you retire, your expenses are going to be a lot less and really they're not. So my expense is I charge everything and they average anywhere from 36 to 5,000 a month. That includes the $1,000 a month for the mortgage. Got it.

Okay. So if you didn't have the mortgage, and that's usually the biggest thing that comes out when you retire is if, if the idea that you're, you know, you get to completely being debt free, obviously that major expense comes out. And then there's some minor things like maybe I'm not eating out as much, although maybe you're great about taking lunch when you go to work or whatever it might be, but maybe you're driving a little less. I mean, some of those kinds of things add up, but the big one would be, can we get rid of the mortgage? But basically what I'm hearing is if we still had the mortgage hanging around and we will for a while, unless you prioritize paying it off, then you're going to probably need to pull about $1,000 a month based on what you can tell from that 194,000.

Is that right? Well, if I'm, uh, my current monthly income is 9,600 and with my retirement, I'll make a little over 6,000. So I'll have my social security 4,000. I have one pension at 600. And then when I quit my job, when I quit my job, I'll get the 1600. So that equals a little over 6,000 a month. Okay.

That's excellent. Well, here's the thing. I mean, well, a couple of other questions. What the home repairs or renovations, do you have a rough estimate on what that's going to cost? So I haven't had estimates done, but you know, I need the kitchen, the deck and stuff, other things, basements.

So I'm guessing 40, 50,000. I'm guessing. Okay. All right.

And then I'll need a car. I mean, that's a necessity. Yeah. Yeah.

That might be another 30. Okay. Got it.

Yeah. So, I mean, right now, in terms of what you've got in your checking account, you've got 112. So I wouldn't want to pay off the $110,000 mortgage as much as I'd love to recoup that thousand a month back into your budget. That would really just deplete all of your liquid savings and we don't want to go there. And so we want to keep at least three to six months expenses. So for you, let's just make a round number of 5000 a month. I mean, that's 30,000 that you really need to keep in your emergency savings at a minimum.

You may want to have a full 12 months, but let's just start with the 30. And then let's say you're going to spend another 30 on the car. And so that's 60 right there.

So that's 60 of our 110. And then we haven't touched the house at that point. So really, most of this money is probably spoken for if we were to get the car, get the renovations done, and at that point, you're basically left with just your emergency reserve. And then we're kind of paying on the mortgage and maybe you're adding a couple of extra payments a year just out of your excess without touching the 194. If you're going to have, you know, perhaps somewhere between one to 2000 a month extra over and above your expenses with the two pensions and the Social Security, you know, we could take that and apply that to the mortgage and just try to accelerate it.

You've got a good, you know, a nice low rate, but I'd hate for you to plead all that money. We can't deplete more than we would want to keep in liquid reserves because I just don't want to go there and the car, you know, could be imminent. So I think for that reason, because you can't pay off the mortgage, which is the only way to eliminate that expense, I would probably prioritize the emergency savings at a minimum of 30 plus the car.

So that's 60. And then at that point, you just decide, do I want to go ahead and start chipping away at the house projects? Or do I want to start, you know, really accelerating that mortgage payoff, even though you're not going to pay it off in the next year or two?

Maybe we set a goal to pay it off in the next five. Thanks for your call today. We appreciate it. Hope that was helpful. Before I let you go, let me remind you, if you're looking for an advisor that shares your values, we recommend the Certified Kingdom Advisor designation. 1,500 men and women across the country have met the high standards in character and competence, but they've also been trained to bring a biblical worldview of financial decision making to their professional advice. They've also had pastor and client references. You can find a CKA in your city when you head to faithfi.com and click Find a Professional. It's faithfi.com and click Find a Professional. I hope you'll come back and join us next time on Faith and Finance when we go back to God's Word and look for biblical wisdom for your financial decisions. Faith and Finance is provided by Faith Buy and listeners like you.