This Faith in Finance podcast is underwritten in part by Movement Mortgage. Movement provides residential home loans in all 50 states. Founded in 2008, amidst one of the biggest financial meltdowns in American history, Movement set forth on a mission to create a movement of change in their industry and in communities. Learn more at movement.com/slash faith. Movement Mortgage LLC supports equal housing opportunity, NMLS number 39179.
For licensing information, please visit NMLSconsumerAccess.org. Have you ever noticed how unexpected expenses always seem to show up at the worst time? Hi, I'm Rob West. The truth is, most of these costs aren't surprises at all. We know cars will break down, homes need repairs, and Christmas comes every year.
Today we'll talk about how sinking funds can help you prepare with wisdom instead of panic. And then it's on to your calls at 800-525-7000. That's 800-525-7000. This is Faith in Finance, biblical wisdom for your financial decisions. Scripture has a lot to say about this kind of preparation.
Proverbs 21:20 reminds us: Precious treasure and oil are in a wise man's dwelling, but a foolish man devours it. Wisdom means setting aside resources now instead of consuming everything immediately. One simple way to do this today is by using sinking funds. A sinking fund is money you set aside gradually for a future expense. Instead of panicking at a $1,200 Christmas bill, you can save $100 per month all year.
Instead of reaching for a credit card when your car needs new tires, you draw from the fund you've been building. It's not glamorous, but it provides peace of mind and freedom from debt. This mirrors the principle Joseph applied in Genesis 41. When warned of famine, he set aside one-fifth of the grain during years of plenty. His preparation was not random, it was systematic and consistent.
Sinking funds are the same, disciplined, steady contributions toward needs we know will eventually arise. Another Biblical picture is found in Proverbs six, six through eight Go to the ant, O sluggard, consider her ways and be wise. Without any chief, officer, or ruler, she prepares her bread in summer and gathers her food in harvest. God holds up the ant as an illustration of diligence. Why?
Because she doesn't wait until the snow falls to collect grain. She steadily prepares during harvest season. Preparation in the present leads to provision in the future. You may ask, but isn't trusting God enough? Shouldn't I just pray when an expense comes and rely on Him to provide?
We have to remember that trusting God never means neglecting stewardship. Throughout Scripture, trust and planning go hand in hand. Noah trusted God, yet he still built the ark. Farmers trusted God, yet they still sowed seed. Joseph trusted God, yet he still stored grain.
Faith is not passivity, it's obedience expressed in wise living. Setting up sinking funds isn't a lack of faith, it's a demonstration of it. It recognizes that God provides resources today to prepare for tomorrow.
So, where should we start?
Well, consider expenses that are inevitable but irregular. Common categories include car repairs and replacement. You may not know when, but you do know the repair shop will eventually call your name. Home maintenance, whether it's a leaky roof, worn-out furnace, or broken appliance, homes require care. Medical costs.
Copays and deductibles always come around. Gifts and holidays, birthdays and Christmas are not surprises. They fall on the same day every year. Insurance premiums or taxes. If paid annually or quarterly, sinking funds break them into small, manageable pieces.
Think of sinking funds as Joseph storehouses. They don't need to start big. Consistency matters more than amount. Even setting aside just $25 a month builds margin over time. The New Testament shows the same mindset.
In 1 Corinthians 16, 2, Paul urged believers to set aside money regularly in proportion to income to meet the church's needs. That's essentially a spiritual sinking fund. Planned, systematic stewardship is a biblical habit. not only for giving, but for household provision. Of course, we must balance preparation with perspective.
Jesus warned in Luke 12, 16 to 21 against hoarding wealth for ourselves. The goal is not to stockpile, but to steward resources so we can live responsibly and freely bless others. A sinking fund isn't about building treasures on earth. It's about positioning ourselves to walk wisely while keeping our hearts focused on God's kingdom. Here's a practical place to start.
Choose just one category. If you've never saved this way, begin with Christmas. Break the cost into monthly pieces and start setting aside now. Once the habit is established, add a second fund, like car repairs or medical expenses. Over time, you'll have a system that turns stress into intentional planning.
In the end, creating sinking funds is more than a budgeting trick. It's discipline and practice. It's the daily choice to trust God by stewarding His provisions carefully, planning not out of fear, but out of faith. With each small deposit, you build not only financial stability, but also a testimony of wisdom and obedience. All right, your calls are next, 800-525-7000.
We'll be right back. We're grateful for support from Movement Mortgage, who provides residential home loans in all 50 states. Guided by a mission to love and value people and a goal to redefine the mortgage process, Movement seeks to help others achieve their financial goals. You can find out more at movement.com/slash faith. Movement Mortgage LLC supports equal housing opportunity, NMLS number 39179.
For licensing information, please visit NMLSconsumerAccess.org. We are grateful for support from Praxis Investment Management. Since 1994, Praxis has offered investment products designed to meet practical needs for everyday investors seeking to steward their assets consistent with their desire to promote positive social and environmental impacts. Praxis aims to bring a faith-based approach to ETFs, mutual funds, multi-fund portfolio solutions, and money market accounts reflecting their 500-year-old Anabaptist Christian faith tradition. More information is available at PraxisInvest.com.
Thanks for joining us today on Faith and Finance. All right, we're ready to turn the corner today. Here's what we have for the rest of the program. We're, of course, going to be taking your questions.
So, if you have something on your mind, financially speaking, we'd love to hear from you. That number 800-525-7000. Again, 800-5257-777777777777777777 525-7000. Our team is standing by, and you can call right now. Claren, thank you for calling.
Go ahead. Hi. Is like I'm retired, but I'm still working a few days a week. And my Social Security is deducted From my paycheck.
So what happened to that Social Security? Do I get it later or uh How does it work? Can you explain? I can, yeah.
So your FICA continues to come out during your working years.
Now, in terms of how it benefits you, it only will benefit you positively if you are earning more now than any of the high 35 years that are determining your benefits.
So if you're earning more than you have in any of your high 35 previous years, then you'll replace those with your new current earnings and that will result in a higher Social Security benefit. But if you're not, then it really is not going to do anything for you. It's just going to continue to be paid into the Social Security Trust Fund and be there to help other folks or to contribute a portion to your own check. But at the end of the day, the only way it actually benefits you is if you're earning more than any of your previous high 35. Does that make sense?
Yeah.
So I I am not making more than what I used to make it.
So, I don't think I can benefit from that, right? You really can't. No.
So, your benefit is locked in. You're not replacing any of those high 35.
So, your increases in the future from Social Security are only going to come through cost of living adjustments at this point. And that has no bearing on how much you pay into Social Security from this point forward.
So, unfortunately, no, there really is not a whole lot of benefit there for you. But I hope that extra income is helpful. We appreciate your call today, Claire, and may the Lord bless you. All right, let's head to North Carolina. Ricky, how can I serve you?
I was listening to I listened to it. quite a bit.
So I'm 66 years old. I'm approaching retirement in 10 months. And I want to know how to best manage these retirement resources So I still experience the same quality of life. That I'm experiencing presently. My wife is going to retire about the same time.
We have a combined income of about $180,000 a year. And so right now what we have in place is I will be in Social Security.
So will she. I will be getting a pension. She will not. And we have, I have a 401k that has about 40,000 in it. And then I have a 403B.
It has about 195,000 in it. And then my wife has a 403B that has about 350,000 in it.
So trying to figure out of how do we dilute. the resources to supplement our income so we can still maintain that same quality of life that we're experiencing now. Yes.
So I'm with Lincoln Financial and Kepper. and cheese with a fidelity.
Okay. Got it. Yeah, that's really helpful. And what is your plan on these four hundred one Ks if you have one? Are you planning to leave them with Lincoln?
Are you thinking of rolling them out to an IRA? And if so, who would be managing that? Uh don't have Plan. I was looking at the paperwork with my wife's annuity with Fidelity. They have it's actually an annuity.
So, what they have is some type of dilution where they only give you. uh access to a fixed amount a year. I really don't know what that means if you Made the contribution of your paycheck all this time, how can they control how much that you? uh want to uh access unless You have to roll it over to somebody else so you can have freer access, not meaning that's what you're gonna do. but I didn't know that they could control your financial resources like that.
So I wanted to know what my options were so that we could have more control over the resources instead of who we've been with all these years. Yeah, yeah, good question.
So, a lot there, but I appreciate that.
So, there are basically 401ks. With annuities inside them. They call them in-plan annuities as an investment choice. And basically, it does give you the option to Basically, convert that 401k to a guaranteed lifetime income after retirement, similar to a pension. But you also should have the option, you know, to roll that out and, to your point, get more flexibility.
And, you know, you could end up with, if you wanted, two IRAs, you know, one for you that would receive your 401k and your 403b in one account, and then one for her that would be the recipient of her 403b and not elect that annuity option. Instead, you'd take a lump sum rollover, and therefore you wouldn't be converting it to an income stream. And then you'd have more flexibility over how it's managed and invested, although you'd be assuming the risk. You'd have more flexibility on what you do with that.
Now, kind of going back to the big picture, you know, you said you guys are living on 180,000 income. Normally, people, when they transition into this next fourth quarter of life, they live on, on average, doesn't mean that's gonna be true for you, 70 to 80% of their pre-retirement income. Because they're not saving for retirement anymore. Maybe they're debt-free now and don't have the house payment. The kids are off the payroll.
You're not eating out as much for lunches and work clothes and those kinds of things. And you put it all together and you typically can live on about 80% of what you were living on. Do you think you're still going to need $15,000 a month? Or do you think that new budget is something lower than that?
Okay, uh I know it's uh Somewhat lower than that 'cause I've already did it. a budget, what my expectations are going to be but uh retiring when my wife retires with me.
So I'm thinking it's probably going to be around uh eight thousand. Oh, yeah. Quite a bit longer. It might even be less debt because we are big time savers. Yeah.
Yeah.
And so now you're not saving. Yeah, I love it. That's exactly right. And that's what most people find.
So let's use that as just kind of a placeholder. And it would be important for you to kind of dial that in as you get into this next season. Have you totaled up what you're expecting from the pension and the two social securities? Yeah.
So, between the pension and the Social Security, I'll be getting $57,000.
Okay. And so that's both Social Securities plus the pension. That's not both so. Security, that's just mine. On my wife's side, She's going to get you add to that 57, you add another 30.
So we'll be getting 87.
Okay, great. Yes.
I mean, that's going to give you $7,250 a month roughly before we even touch the 403Bs and the 401k, which is great. Because if you only need an extra $1,000 a month, let's say, and then maybe a little bit along the way for, you know, some trips or something unexpected, you know, that would be phenomenal. And, you know, the nice thing is when you put all these other accounts together, you've got about $585,000. And, you know, you could easily pull 4% a year, which would be another basically $2,000 a month, but it doesn't sound like you're going to need that, which is good because that can continue to grow. And then you'd have to decide: do you want that to be really the amount that's growing in case you need long-term care down the road, or do you want to take out a policy, although they can be expensive?
But I think you're in pretty good shape. I think the next step is just who's going to manage it. And I'd recommend you connect with a certified kingdom advisor there in North Carolina and have all of these rolled out of these insurance companies into an IRA at Fidelity or Schwab or wherever the advisor is, and then just have the advisor manage it. But the good news is, you're in really good shape. Stay on the line.
We'll talk a bit more off the air, Ricky. We'll be right back. Managing money doesn't have to feel overwhelming. or disconnected from your faith. The FaithFy app helps you budget with purpose, combining easy-to-use tools like digital envelopes with biblical wisdom and a Christ-centered community.
Whether you're new to stewardship or looking to grow in generosity, The FaithFy app equips you to honor God with every financial decision. Join over 70,000 others and start today by downloading the app from your app store or by visiting FaithFi.com and clicking App. That's FaithFi.com and click app. As the leading advocate for the Christian financial industry, Kingdom Advisors serves the public by promoting the integration of a biblical worldview across every aspect of the financial services industry. And we serve a growing network of thousands of Christian financial professionals, equipping and empowering them to carry biblical financial wisdom to their clients, peers, and community.
For more information, visit kingdomadvisors.com. That's kingdomadvisors.com. Great to have you with us today on Faith and Finance. I'm Rob West. We're taking your calls and questions today.
800-525-7000 is the number to call. Again, that's 800-5277777777777777777777 525-7000. All right, let's head back to the phones. We're going to try to get to as many as we can here before we round out the show. Rose has been waiting patiently in Illinois.
Rose, go right ahead. Yes.
My question is, when I grew up, I didn't have a lot of financial training. And my parents were in debt all the way until I got married. I was the last kid out of the nest. And I see that problem in my children and the people that they married that they're You know, the things that come up are you know, the emergencies that come up are a surprise and You know, how do we handle that? And you should be saving, but you really don't have any guidelines beyond that.
Yes.
Are there books that aggress? The attitudes that we were raised with. I've got one person that I'm related to that. His parents were, in his mind, very rich. And uh he just thinks that Well, if this needs to happen, then we're going to charge forward.
And I'm like, there's other ways, you know, think through this. And he's like, no, I'm spending the money. Yes.
So how do we are there books or what? How do we change our attitudes or identify that This is a problem, and how do we correct it? Yeah, it's a great question, and I think you're exactly right. I mean, our financial habits are often shaped by what we saw growing up, both the good and the bad. Remember, more is caught than taught.
Uh, the encouraging news is that those patterns don't have to define your future or your children's. You know, scripture reminds us that in Christ we're made new, 2 Corinthians 5, and that includes how we steward money.
So, I think you're onto the right track here because a helpful step is to explore resources that both combine practical guidance but with biblical wisdom. God's word has a lot to say on this topic because it becomes money, the end that so many people are seeking to find fulfillment and purpose and security and satisfaction. And we know that those can only be found in Christ. And when we understand that money is a tool provided to us by God, it all belongs to Him, and we're stewards with responsibilities, not ownership rights, and that we're to manage. That according to biblical wisdom, money then becomes a means to an end, not an end.
And that means to an end is for our enjoyment. As long as it doesn't rival our affection for God, He is our ultimate treasure. We can enjoy it appropriately, we can give it away, we can invest it strategically, and it can add meaning to our life, but it can't be the meaning of life. And I think renewing our minds around those ideas and then adding practical how-tos alongside that is really key. What are the ages or age of the family members we're talking about here?
Because that might help shape the resources I recommend. Um, I'm saying forties.
Okay, got it. Yeah, so I think there's two books. One is kind of a light read and just maybe an introduction to this topic. One's a little more dense. I'd be happy to send you either one, and I can send you several of them if there's multiple family members.
Would you rather something that's a little bit of a quicker read, or do you think this is something that, you know, some of these folks would go a little deeper into? They don't I don't see them. as uh book readers, but my Daughter does. Online listening. Oh, okay.
Yeah, very good.
Well, I think, you know, let me send you a couple of copies of Howard Dayton's book, Your Money Counts. And what this is going to do is really just tee up this idea of a biblical perspective of money management. And, you know, they can read it in a weekend or, you know, over a few weeks if they take their time. But it'll cover all the key areas from God owning it all to our role as stewards to spending and saving and debt and investing. And I think really be a great primer, if you will, toward the things that you're hoping that they'll begin to take away.
So let's do this. You hold the line, Rose. We're going to send you two copies of Your Money Counts by Howard Dayton. It's our gift to you. You don't have to tell them that we gave it to you.
Just tell them you wanted to share this gift with them. And let's pray that they read it, digest it, and that God's word renews their minds and in a whole host of areas, but certainly including this area of money management, okay? Bless you. Thank you so much. Happy to do it.
Stay on the line. We'll get your information to Cleveland. Hi, Drew. Go ahead. Hey Rob, thanks for taking my call.
I enjoy the show.
So I enjoy hearing about the faith-based alternatives and I've investigated some of them, and it seems like the fees whether it's the sales charge or the expense ratios or fairly high compared with a product from Vanguard or Schwab or something like that. And sometimes they're also not nearly as diversified.
So I'd be curious to kind of get your perspective. On that. Yeah.
It's a good question. I mean, I think you need to compare apples to apples in the sense that, you know, you've got to look at managed account mutual funds versus index funds. You know, I would say anything that's under one and a half percent is In the reasonable range. And there's no question that fees have been coming down. And so there's been a lot of pressure on fees to come down.
We know Fidelity, for instance, came out with their first free ETF not too long ago, and others are following suit. But at the same time, when you have an actively managed portfolio, you're going to pay for it. And the good news is that the studies, and one just came out recently, Tim McCready of Brightlight, who's really taken an interest in this whole faith-based investing space, the studies will show that you don't have to give up performance, even net of fees with the faith-based investing funds, which is good.
Now, you need to look at share class.
So, that would be one thing I would tell you. And the share classes that don't have the front-end sales charges, in some cases, are going to have higher minimum investments. And some cases that'll go up as high as $100,000 for a minimum investment. But that's where you're going to get the lowest net expenses, around 1.2% for probably most of these funds.
So, I would factor in fees, no doubt. You don't want to just discount it completely and ignore it. I would always look at the various share classes to find the one that's the best fit for you. And if you have the capital to buy the institutional classes where you're going to put in higher minimums, that's going to give you the opportunity to get those expense ratios. Down much lower.
But at the end of the day, what I would say to you is that the performance is there in this category versus their peers, and that includes net of fees.
So I would love for you to have the opportunity, if this is a conviction, to be aligned with your values. Get great performance, and yet, you know, still be mindful of the fees at the end of the day. Does that make sense? Yeah it does. Thank you.
Okay, I appreciate it. And it's a great question, Drew. I'm not dismissing it at all. And I do think we've got to look at that as one piece of the equation, but just make sure you're looking at the whole picture before you make the decision. Folks, that's going to do it for us.
So thankful for the folks that make this possible every day, Sandy and Devin, and grateful for Jim Henry as well, and everybody here at Faith Phi. Hope you have a great rest of your day. And by the way, if you'd like to support Faith Phi and the Faith and Finance broadcast, you can do that online quickly and securely at faithphy.com. Just click give. Lord bless you.
Bye-bye. Faith in Finance is provided by Faith Buy and listeners like you.
