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Uh High-yield savings rates have dipped a bit since early spring, but they're still strong enough that locking one in for a season could be a wise move. Hi, I'm Rob West. After several quarter-point rate cuts by the Federal Reserve since March, savings yields have eased slightly. Even so, many online banks continue to offer returns far above what you'll find at most brick-and-mortar institutions. We'll unpack what that means for you today.
Then it's on to your calls at 800-525-7000. This is Faith in Finance: biblical wisdom for your financial decisions. When it comes to building financial stability, savings and investments serve very different purposes. A savings account is where you keep money that must remain safe and accessible. Your emergency fund, your short-term needs, and the dollars you rely on in the next few years.
Savings won't produce investment-level growth, but the interest they do earn still plays an important role. Every bit of growth helps preserve your purchasing power and strengthens your financial footing over time. Over the past few years, inflation surged well above the Federal Reserve's 2% target. To counter that, the Fed raised the federal funds rate aggressively. As those short-term rates climbed, savings yields, especially at online banks, rose right along with them.
Earlier this year, many high-yield accounts paid between 4.4% and 5%, sometimes more, giving savers an unusual opportunity to earn meaningful interest on cash that would otherwise sit idle. Since then, we've had three 25 basis point rate cuts as inflation has cooled. Those cuts have nudged savings yields lower, but not dramatically yet. Today's rates remain historically strong and far more generous than those offered by traditional banks. And because banks rarely adjust their yields immediately after a Fed announcement, there's usually a window, sometimes several weeks, when consumers can still take advantage of higher rates before they drift downward.
If you've been meaning to move your savings, this brief pause and rate adjustments can work to your advantage.
Now, a savings account isn't locked in the way a CD is, but moving your money into a competitive, high-yield account today allows you to benefit while rates gradually settle. Banks tend to change yields cautiously, often watching one another before making adjustments. That slower pace creates a kind of buffer, one that gives you time to act before the broader market shifts. And for many families, knowing that your savings are earning a strong, reliable return allows you to plan with greater confidence, whether you're bracing for an unexpected expense or setting aside money for opportunities God may bring your way. When your savings work a little harder, it reduces pressure and builds peace of mind.
So, how does this fit into your broader financial plan? First, your emergency fund should be in a savings account, ideally, one that offers a competitive yield. Keeping three to six months' expenses on hand helps you weather financial surprises without turning to debt. And the more your savings earn, the faster that cushion grows. Second, any money you'll need in the next two to five years, whether a home down payment, a major repair, or a planned purchase, should stay protected from market volatility.
A high-yield savings account offers both safety and reasonable earnings. Third, this is a great moment to compare what you're earning with what's available elsewhere.
Some traditional banks still pay as little as 0.01%, essentially nothing, while online banks regularly offer rates dozens of times higher. If you're not earning a competitive yield, switching may be worth it. Sites like BankRate and NerdWallet can help you compare what different banks are offering, not only identifying the highest current rates, but also providing reliability scores, customer reviews, and safety ratings, so you can choose institutions that are both competitive and trustworthy. Money market accounts are another solid option. Many pay competitive rates and offer more flexibility than CDs, including the ability to write checks.
Just keep an eye on minimum balance requirements. And don't overlook credit unions. As not-for-profit institutions, they often return earnings to members through stronger rates and lower fees. One great example is Adelphi Christian Banking, a credit union we know well. They offer competitive yields and invest in gospel-focused ministry work around the world.
You can learn more at faithfi.com/slash banking. That's faithfi.com/slash banking. As you consider where to place your savings, remember, stewardship isn't simply about maximizing returns. It's about managing God's resources with intention and care. Saving consistently month after month, year after year is slow, faithful work, and choosing a wise savings vehicle supports that journey.
All right, your calls are next. The number 8005. 525-7000. We'll be right back. You can do more than make a year-end gift.
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CHM offers programs starting under $100 per month. Check off the affordable box on your list and get back to what you really love, running your business or caring for your kids, and have peace of mind while doing it. Visit chministries.org slash faithfi to enroll today. Hey, thanks for joining us today on Faith and Finance. We've got lines open.
We're ready for your questions: 800-525-7000. Call right now. Let's go to Columbus. Hi, Sandy. How can we help?
Hi, Rob. I have to me, it seems convoluted, but I think it's probably simple. Need a new car. I'm seventy, I'm retired, so I have a good monthly income. But I'm trying to figure out if I should Go ahead and pay off my home, which I owe $27,000 on.
Or I should which of course would be a higher payment or get a car which I need, which could be maybe around twenty and lower payments, but I'd rather not have two payments. And I'm unsure about where I pull that money from. Yeah.
So I understand you've got the $27,000 mortgage, $70,000 and retired, and the car that you need, you think you need to spend about or you're looking to spend about $20,000. What are you doing right now for transportation? I have a car, but it's a 2012 and it has 160,000 miles on it.
Okay. Does it need extensive repairs or is it in fairly good working order? It doesn't need extensive repairs. No.
Okay. All right. I think it's more about my feeling of security. Yeah.
And I can certainly understand that. You know, the last thing you want to do is be stuck somewhere because the car, you know, doesn't work. I mean, you can help with that by, you know, getting a membership to some service that'll come out and take care of that. But obviously, you know, as a 70-year-old female, I can understand why you would want to have a worthwhile and trustworthy car. Let's talk about the assets that you have because I know that would be the next question: where do we pull from to either pay off the house or you know buy the car?
So, what do you have available? I retired from public service, so I have deferred comp, and I have about one hundred and ninety in there. I have in my credit union, I have probably around I think it's around twenty, and eight of that is in the money market.
So other than that, I have some money in my checking count, which I really hate to admit, but I had loaned a business I had been in.
some money and when it came back to me I could have put it back. in the deferred comp So it's been sitting in my account, and it's about 20,000 as well. Check your account.
Okay, so you've got about 50,000 all in between the 80 and the 220s. Is that right? Yeah.
Okay. So what do you spend on a monthly, typical month? In general? Yeah, just on the average month, what do you think your total expense is roughly? About three thousand.
Okay. So if we wanted six months' worth of expenses, that'd be $18,000. You know, let's call it $20,000.
So if you just kept the $20,000 in the credit union and you pulled the $8,000 and the $20,000 that's in checking and paid off the house, which that would do it, you'd all of a sudden at that point, you'd still have more than six months' worth of expenses in liquid reserves. And now you'd free up the monthly payment that you were sending for the house, at least not the taxes and the insurance, but at least the principal and interest. Do you know how much that is every month that you'd now be saving? I couldn't tell you that right now. I didn't think about looking that up.
Yeah, that's okay.
So that would be one thing is if you're really set on I only want to have one loan, then I would be comfortable with you paying off the house, still having six months' worth of expenses in the bank. Plus, your income stream, not touching your deferred comp so that can continue to grow, and then taking that monthly payment that you were sending to the house, principal and interest, and now using hopefully a lot less than that, but some of that for the new car payment, not the new car, but new to you. And then, whatever's left that you're not using for the car payment, you're now building back up your emergency savings. Does that make sense? Yes, yep.
Okay, so that would be one option. The other option is you leave the home the way it is. And just buy the car outright with the 20,000 that's in your checking account. That's from that business. Yeah.
And now we're not adding a new payment, and then you just focus on paying off the house over time. And now you've still got $28,000 in savings, which is even more than six months, because that would give you, you know, if you're spending $3,000 a month. That would give you nine months' worth of expenses.
So I think you could go either way, buy the car outright and still have nine months' expenses, or pay off the house and still have six months' expenses and then just save the difference between the new car payment and the mortgage payment that you're now no longer paying. Yeah.
Thank you. You are welcome. Simplified.
Well, I'm glad, and I appreciate your call today. All the best to you, Sandy. Thanks for being on the program. 800-525-7000 is the number to call. Let's go to Mississippi.
John, go ahead. Yes, sir. Mr. Rob, what's the best way to invest? In gold.
I missed the train years ago, and now I want to. protect myself long term by investing in goals. Can you tell me? What's the best way to do that? Yeah, I like this question, John.
And I think the key here is to have an appropriate allocation of gold, especially just given what's going on with gold this year and even last year. I mean, we're up here in the clouds.
Now, does that mean it's not warranted? No, I don't think so. But I don't want you to chase return and get too highly concentrated in gold because historically gold, although it's a store of value and it's a part of a diversified portfolio, it's uncorrelated from the stock market. It tends to do well when stocks are not, even though we're in an environment where everything's going up, including gold and stocks. But normally, you know, it's a fear trade and I think there's a place for it.
I like to think about it like this, John. It doesn't mean this is the right approach for everybody, but an approach is to say, okay, if the most I want to own in my portfolio in the gold category is 10%. And I think the appropriate amount for some, you know, for most people is between 5% and 10%. Let's say it's 10. What I like to think about is that first 5% is what you might call or think about as your forever allocation.
And that's where you may actually take physical possession of the gold. And you'd own it and you'd store it maybe in a safe deposit box or a fireproof safe in your home. You'd buy it. The plan is to keep it for life, maybe pass it down. That second 5%, a great way to buy that is through what's called an ETF.
So there are a number of exchange traded funds that you could choose from that essentially have gold in a vault backing them. But they trade like a stock.
So you can go in and buy a gold exchange traded fund any day that the New York Stock Exchange is open with the click of a button. And there's a bunch of them. The biggest one is GLD. That's the symbol. It's the largest physically backed gold ETF.
It's from the ETF provider called Spider. There's another one called IAU, which is from iShares. That's a lower cost alternative, again, tracking physical gold. And then there's a number of them. Granite Shares has one.
Golden Sachs has one. But essentially, it moves in lockstep with the price of gold. But you don't have to take physical possession and it's more liquid. You could sell it at any time with the click of a button as long as the market's open and get the next trade. And so between the two, the physical versus the gold ETF, you know, I think you could ratchet up your allocation to 10%.
Now, I know just based on the notes here from when you called, is you're also interested in Bitcoin. And I like to think about Bitcoin, which by the way, I think has reached a mainstream status. And we could talk about why that is if you're interested. I like to think about that as a part of your gold allocation because that's really where it fits. And so perhaps you take two or three or four percent of that 10% and buy a Bitcoin ETF as well.
And I think that could be a way to go there.
So, hopefully, that gives you what you're looking for. More of your questions coming up in the final segment. Stay with us. Wondering who Faith and Finance recommends as a banking partner that aligns with Christian values? It's Christian Community Credit Union.
When you open a high-yield checking, savings, or visa cash back card, you'll help advance the gospel when making everyday transactions. Visit faithfy.com/slash banking and use code FAITHBY when you sign up. That's faithfy.com/slash banking with code FAITH FI. Membership eligibility required. Each account is insured up to $250,000.
This institution is not federally insured. 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 impact. Praxis aims to bring a faith-based approach to ETFs, mutual funds, and multi-fund portfolio. Portfolio solutions and money market accounts reflecting their 500-year-old Anabaptist Christian faith tradition.
More information is available at PraxisInvest.com. You know, here on this program each day, we want to help you see money as a tool to accomplish God's purposes. Recognizing money is a good gift, we should use it to enjoy and provide. We also need to understand that the use of money is highly spiritual. There's a connection between how we handle money and our hearts.
Remember, Jesus said, Where your treasure is, there your heart will be also. You know, when he called out the widow and celebrated her giving out of her poverty, versus the Pharisees that were giving far more, that he really scolded. You know, I think what we were seeing there is that the way we handle money has a way of illuminating what we truly treasure. And that means that our spending tells a story. It reflects our values.
And the question is: what story is it telling? You know, does the way I'm handling money reflect what I want to be most important to me? And if not, what changes do I need to make?
Well, each day on this program, we want to help you understand the counsel of scripture as it relates to managing God's money, but also in doing so, help you answer those very practical questions that you have going on in your financial life.
So if there's something you're wrestling with, call right now, 800-525-7000. Let's go to Louisiana. Doug, go ahead. Yes, uh Yes, sir, very quickly. I I I'm retired and I have uh some money with Edward Jones.
Been with them like 13 years, and this year they will change their strategy. They want me to. take one point two percent of my whole portfolio, which is around one million dollars. And pay that fee instead of making transactions and getting, you know, their. Their cut off of each transaction.
They just say, just take one point two percent of your portfolio or take that out every month. And I'm trying to, I said, okay, I'm going to go with what you want. And I'm just concerned about recouping my fees And then making enough profit to make it worthwhile. Just see if you think it's a good idea. Yeah, I'm on board with that, Doug.
You know, I mean, that would be normal and customary, that 1.2% management fee based on the assets under management, which puts the emphasis on growing the account because the only way they get a raise is if your account goes up. And, you know, you're going to get active management for that.
So it's less about each transaction and more about the advisor's interests being aligned with yours to give ongoing oversight to protect and grow what you have. And having that kind of expertise involved in making those investment selections, I think, should more than offset the cost of the advice over time and the management at 1.2%. And I think, you know, you've built quite a nest egg here. And yes, you know, $12,000 is a lot of money. But at the same time, I wouldn't want you to put that on autopilot.
I wouldn't want you to make emotional decisions on buying and selling. I'd rather you have a rules-based approach with somebody who really can give careful. Attention to this on an ongoing basis.
So I'm a fan of this type of approach where you pay a fixed percentage based on the assets under management. And Edward Jones is a world-class broker-dealer. And as long as you have an advisor that shares your values and that you have trust with and that can really build a portfolio that reflects your goals and values, then I'm on board.
Okay, well I That gives me some confidence. Thank you so much. All right. Thanks for your call, Doug. Lord bless you, sir.
All right. We've got just a little bit of time left. Maybe room for one more call, 800-525-7000. You know, one of the questions that John asked earlier when I connected with him off the air, he asked a great question that perhaps is something you're thinking about. He says, What gives Bitcoin value?
I mean, if it's something that's completely digital, I can't touch it or hold it in my hand, what in the world gives it any kind of value? And, you know, the answer to that is really because people agree it has value, which is not unlike paper money. That's not backed by gold anymore. It's a fiat currency. Gift cards, airline miles, even the dollar bill in your wallet, none of those have value by themselves.
We can't eat them or build with them. They're useful because people trust and accept them. And as we think about Bitcoin, you know, the reason that it has the properties of fungible money is that because, first of all, it has a limited supply.
Well, there will ever only be about 21 million Bitcoins.
So anything that is scarce has potential value. Think land, rare collectibles. Second, people want to use it. Bitcoin lets people transfer money globally, quickly, and without a bank.
So, if people want something and it's scarce, well, then it generally becomes valuable. I think the third kind of big idea here on what gives Bitcoin value is the network keeps it secure.
So you've got millions of computers that verify and protect every transaction. Nobody can change the record or print more Bitcoin or control it for everyone else. And that security and independence are attractive to many. You know, a helpful comparison might be: why does a baseball card sell for $1,000?
Well, because it's rare and somebody wants it. If people stop wanting it, the value drops. If more are printed, the value drops.
Well, Bitcoin kind of works the same way. The scarcity gives it potential value. And then the demand gives it real value.
Now, it has gone mainstream, and I think Bitcoin clearly stands apart from the rest of the crypto industry. It's reached critical mass. It appears to be here to stay, largely due because of the regulatory environment that has completely reversed from being hostile to being welcoming. We've also seen a shift in terms of the approval of Bitcoin ETFs, which has opened the door to institutional adoption, which means big players with big money and influence are now allocating to Bitcoin. And a lot of people like to think about it as digital gold, because it has a lot of the characteristics of gold.
It's a store of value that protects your purchasing power against the constant debasement of government currencies. And I know that may sound crazy to call an asset that has the volatility of Bitcoin a store of value. But again, with the scarcity that's built into its DNA, It has that power to act like and really emulate gold.
So, I think for that reason, a lot of people are thinking about it as a part of their gold allocation. If you're going to have 10% in gold, maybe you take 2%, 3%, 4% and move it over to Bitcoin.
So, hopefully, that answers a few questions from some of you out there wondering the same thing. Hey, before I wrap up today, let me mention here at the end of the year, this is a really important time for us to hear from you. FaithFi is listener supported. This program doesn't come to you each day without your support.
So, if you love the program, you found something helpful or valuable, now's a great time for us to hear from you. And We're also going to be able to double every gift. We've got some friends that have put up up to $175,000 to double every gift until we reach that level. That's going to help us finish the year strong. And every gift between now and the end of the year is going to ensure that you get a copy of my new devotional, Our Ultimate Treasure.
I'm so excited. I'm going to invite you to go on a 21-day journey with us using the devotional starting at the first of the year.
So would you consider a gift today? Just go ahead and jump over to faithfy.com/slash give. That's faithfi.com slash give. Every gift doubled right now. Faithfi.com slash give.
Thanks in advance. Thanks for being along with us today. Big thanks to my team today. Sandy Dickinson, of course, Jim Henry and Devin Patrick, my producer, and everybody here at FaithFi. We'll see you next time.
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