This Faith and Finance podcast is underwritten in part by The Good Investor, a book by Robin John. This Faith and Work memoir hopes to inspire readers to view their work and investments as opportunities to honor God and bring blessing to the world. You can learn more now at goodinvestor.com. That's goodinvestor.com. The one who gets wisdom loves life.
The one who cherishes understanding will soon prosper. Proverbs 19:8. Hi, I'm Rob West. Wisdom doesn't just shape what we believe, it shapes how we live, including how we handle money. Today, Dr.
Greg Forrester joins us as we begin a new series on the cardinal virtues by looking at prudence and why faithful stewardship requires more than financial knowledge. And then it's on to your calls at 800-525-7000. That's 800-525-7,000. This is Faith in Finance, biblical wisdom for your financial decisions.
Well, we're honored to have my friend Dr. Greg Forrester back on the program with us today. He is affiliate professor of biblical and systematic theology at Trinity Evangelical Divinity School and executive director of the Christian Investing Council. He's a theologian, author, and scholar whose work explores faith, work, economics, and faithful Christian stewardship. Greg, great to have you back on the program.
Thank you so much for having me, Rob. It's great to be back. Greg, as you know, we're beginning a new series on financial virtues this month, rooted in the cardinal virtues of prudence, temperance, fortitude, and justice. But before we focus on our first virtue, prudence, help us frame the conversation, if you will. What do we mean by virtue, and why does that matter and how Christians handle money?
Well, virtue means being a Christ-like person. It means having Christ-like qualities in your character. Jesus stresses the importance of this, for example, when he says that we must obey God. From the heart. He doesn't just want you to obey God, he wants you to obey God from your heart.
So you need to have that Christ-like heart. that is responding to God in the right way and for the right reasons. We can also see this in a More fearsome way when he talks about people who are not right in this way, he calls them whitewashed tombs.
So, you know, you can paint that tomb up all beautiful and it looks shiny and clean, but on the inside of the tomb, there's nothing but death. Or he talks about people who clean the cup on the outside, but they leave it filthy on the inside.
So the cup looks good because it's clean on the outside, but the inside is the part you actually drink from. That's what you should be cleaning first. And the reason this is so important for how Christians handle money is that the how and why of our obedience to God are important. It's not just that we do what he says, but how we do it and why we do it matters to God. Boy, that's such a great beginning point and an important understanding for all of us.
Dr. Forrester, when we talk about cardinal virtues as Christ followers, take us back a bit. Where does that tradition come from? And how have these helped believers think about faithful living throughout church history? Yeah, this is a very old tradition.
Christian ethics has always recognized that there's a distinction between moral virtues that everybody knows about. whether they've read the Bible or not. And moral virtues that Christians know about because we've read the Bible. Those are called the theological virtues, and the virtues that everyone knows about are called the cardinal virtues. It's from the Latin word for the hinge of a door.
So they're literally the pivotal. Virtue. It's important because if there are virtues that everyone knows about, first of all, it establishes that you are responsible for your sin, even if you've never read the Bible. You can't say, well, God never spoke to me, so I'm not responsible for disobeying him. Simply by being a human being, having the nature he gave you and living in the world he put you in, you know about these moral virtues and you're accountable to them.
But also, these virtues that everyone knows about are the basis of our shared life with people who don't share our beliefs. We can have a common way of life and live in peace with our neighbors because there are at least some moral virtues we all know about. And among the virtues that are known by everyone, these cardinal virtues are the four most important. They're like the top level virtues. They're meant to control how all the other virtues that we might talk about are displayed.
These are kind of the first priority virtues. Huh. Yeah.
Well, after this break, we're going to dive into them. And today, we're going to spend some time on the virtue of prudence. What it is, why has it often been understood as the virtue that essentially helps to guide the others? Where do we find it in scripture? And how might it relate to how we manage God's money and live as a faithful steward?
We're beginning a new series today. It's the financial virtues series. We're focused on prudence or what you might say wisdom. And we're joined by our friend Dr. Greg Forrester.
We'll take a quick break and then come back with much more just around the corner. And then time for your phone calls. Stay with us. If budgeting feels like a second job, the new Faith Phi Pro was built just for you. It learns your spending patterns, categorizes your transactions, and helps you build a budget based on your real life.
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Wisdom doesn't just shape what we believe, it shapes how we live, and that includes how we handle God's money. Today, we're kicking off a new series. It's our financial virtues series, and we're focused on the virtue of prudence. We're joined today by Dr. Greg Forrester.
He is affiliate professor of biblical and systematic theology at Trinity Evangelical Divinity School. He's also the executive director of the Christian Investing Council. Dr. Forrester, I appreciate before the break how you unpacked where these cardinal virtues come from. And we took a look at how they show up in church history.
Now, some of our listeners may hear virtue and think mainly in terms of moral behavior.
So, how would you explain the difference between simply following financial rules, let's say, and becoming the kind of person who embodies this in their everyday lives as we think about it related to money?
Well, what God cares most about is his personal relationship with people. The whole point of salvation is to restore us to fellowship and communion with God. He made us to love us and for us to love him back, and he wants that relationship.
Now, if you think about your own relationships, you'd never say about someone in your life, like your spouse, your siblings, your parents, your children, your friends, you'd never say that as long as they do the morally right thing, you don't care how they do it or why they do it. I mean, just for starters, imagine if you raised your children that way. You didn't care about why they did what they did as long as they did what they were supposed to, right? You would not be setting them up for success and your relationship with them would not be very strong.
So if we think about money, if you are only looking for the minimum that you can do so that you can feel like you've done your job using your money for God. That's not putting you into relationship with God. What we want is to really start by saying, This is all God's money. How can I use all of it? for his purposes and that brings my whole self into relationship with God through the way I'm using my money.
Wow. Yeah, that's well said. It's not a checklist, but it's really relational and it's loving God through worship of Him, and that includes how we handle His money. What an important distinction. All right, let's dig into this first virtue that we're focused on today of prudence.
What is prudence, Dr. Forrester? And why has it often been understood as the virtue that helps guide all the others?
Well, you know how they say the ends don't justify the means. We've all heard that saying. And just because you have the right goals, it doesn't mean that you can do whatever you want in order to reach those goals, no matter how bad it is, how wasteful it is. Once you've decided what your goals are, Prudence is about figuring out the right way to accomplish those goals. Prudence means figuring out the right means to use to accomplish your ends.
And this is pivotal because everything's abstract as long as you're only thinking about goals. I can sit here and think. Wow, it would be great. If I were a more Christ-like person, you know, if I never snapped at my kids, if I never sat here and daydreamed instead of doing my work, that's my goal. I want to, you know, not daydream when I should be doing my work, or I want to, you know, control my anger more, or whatever it is.
It's all abstract until you think about how am I going to make that happen? What's the concrete action I'm going to take to move toward that goal? This is why we say prudence shapes all the other virtues because prudence is where the rubber hits the road. What's my plan of action for carrying out my goals? Yeah, that's very helpful.
Where do we see this idea of prudence in Scripture? And how does practicing it draw us closer to Christ and perhaps form us more deeply as His disciples? Yeah, the probably the most obvious place to see it in scripture is the book of Proverbs. If you really want to understand the virtue of prudence, just think about this idea of it's not just what my goals are, it's how I accomplish them. And then just sit with the book of Proverbs and read through it, and you'll see God cares intensely not only about what we want to accomplish, but how we do it.
Proverbs really hits that repeatedly. But there are many other places in the Bible we can see this. I've mentioned a couple of sayings of Jesus. I'll mention a couple more. Think about when Jesus says, Be as wise as serpents, but as innocent as doves.
So setting those goals, be as innocent as doves. But also, Jesus is saying, think carefully about how you're going to get it done. Be as shrewd as a serpent. when you're thinking about the how. Or think about how Paul in Ephesians says, look carefully where you walk, not as unwise, but as wise, making the best use of the time.
That idea of make the best use of your time is a prudence, a calling to prudence. Prudence draws us closer to Christ because if you really know God and you really love God, you're going to want to be the best steward that you can be. It's the difference between checking boxes, like you said, which keeps yourself, your personality, distant from God while your actions are, you know, outwardly conforming to him. It's the difference between that and really giving yourself over to God.
So, in financial terms, what does prudence help us see clearly that perhaps we might otherwise miss?
Well, in his book, Mere Christianity, C.S. Lewis has a wonderful line. He has a chapter on the four cardinal virtues, so he's using this same schema. One of the things he says is giving money to a charity is not virtuous. if you don't care whether that charity is a fraud or not.
I mean, if you're giving money to a good cause, but you don't care if the money's well used or if it's squandered. you're not genuinely seeking the good of other people.
So prudence means we care about whether our investments actually perform in terms of God's goals, which includes making a financial return, but also accomplishing God's other goals that he can accomplish through our use of finance. Yes. For example, some people have too little risk in their portfolios because they think risk is inherently bad. They're worried about squandering and so they have too little risk. Other people have too much risk in their portfolios because they think, well, I need to trust God and I'm not being faithful unless I take every risk I can to potentially accomplish more goals for God.
Prudence means knowing the right amount of risk. to take considering all the factors together.
Now there are different goals that Christians can legitimately pursue with their investing. Putting money into missional businesses is good. Having influence as an investor in a mainstream company is also good. Prudence is the virtue that weighs these different goals and sets priorities when we can't accomplish everything all at once. Very good.
We've got just about 45 seconds left. What's one practical step you could leave with our listeners today that want to grow in prudence?
Well, at the Christian Investing Council, we're helping Christians think about how their faith impacts their investing.
So my one practical step is look at the different options you have for your retirement savings, for your other investments, and ask, why is it that my money is invested in this option rather than the other options that my funds might be invested in? Is that decision putting your principles into practice better than other options would? CIC's published a statement on Christian investing you might find helpful. You can find that at ChristianInvestingCouncil.org. Wow.
This has been so rich, and we'll have to have you back because we just scratched the surface. Dr. Forrester, thanks for your time today. Thanks so much, Rob. I appreciate it.
Folks, prudence is wisdom in action, choosing the right means to faithfully pursue God's ends. All right, your calls are next. The number 800-525-7000. Call right now. We'll be right back.
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In his book, Robin shares his journey from an immigrant child struggling in school to co-founder and CEO of Eventide Asset Management, a faith-based investment firm. This Faith and Work memoir seeks to inspire readers to view their work and investments as opportunities to honor God and bring blessing to the world. More information is available at goodinvestor.com. That's goodinvestor.com. Helping you apply God's wisdom to your financial decisions.
This is Faith and Finance. All right, we're going to head to the phones: 800-525-7000. Let's go to Virginia. Frank, how can I help? Yes, hi.
I sold gold last year on eBay, Gold Nuggets. And the total sales were seven thousand dollars. They sent me, I believe, a ten ninety-nine.
So when I filed my taxes, they made me pay the full amount on the seven thousand. But also eBay hit me for a seller's fee of over one thousand.
So once I receive my refund, can I have them file an amendment showing what eBay took out for me to sell this gold. Yes, great question.
So it's a common issue, and the good news is you shouldn't be taxed on the full seven thousand. You just need to report it correctly.
So what the ten ninety nine means is that they report the gross amount to the IRS. That does not mean that's your taxable income. And so you get credit for the fees.
So that $1,000 seller's fee is a legitimate expense that reduces your taxable gain.
So the starting point is the $7,000 that was reported minus the $1,000 in fees, and $6,000 would be the net proceeds. You also subtract what you originally paid for the gold.
So if you bought it for $5,000, you sold it for a net of $6,000, you'd only have $1,000 that's taxable.
So you don't include your cost basis.
So you typically report that as a capital gain on Schedule D. You'd report the sale price, net of fees, and then cost basis and then the resulting gain. And gold is considered a collectible, so it's not the standard capital gains rates. Does that make sense? Yes, well what they did is they filed me as a business and they never asked me the amount of what I paid for the gold or what eBay Charge me to sell it.
So I have to produce that. Then they said that they should be able to file an amendment. Yeah, exactly.
So the return has already been filed, is that right? Yes, yes. Yeah, yeah.
So, yeah, they reported it like a business.
So, the IRS saw $7,000 in income with no cost basis and taxed the full amount. And so, an amended return would let you correct how the sale was reported and fixed the core issue: instead of reporting it as business income, it should be reported as a gold sale, which was a sale of a capital asset, a collectible. And it's the selling price, net of fees, minus the cost basis, and only the profit is taxable. Perfect. Can I make one other point?
I know you're pressed for time. In the Bible, Paul said, be content with food and raiment. And since you're talking about money, I believe the food that he was referring to is the bread of life, which is Jesus. not food that we can physically eat. And the raiment, it doesn't really mean clothing if you study the Greek and Hebrew.
It means a covering, which to me would indicate the Holy Spirit.
So basically, all we need is Jesus and the Holy Spirit. and everything else won't be provided for us. I love that. And I think there's a meaningful idea there that we should be content. You could look at it as basic provision and literal covering.
You could also look at it through the lens of what you're saying. Because remember, that phrase, the bread of life, comes from the Gospel of John, where Jesus said, I am the bread of life, meaning he is our spiritual sustenance, not physical bread.
So I think what you're talking about there is definitely a biblical idea. And, you know, I love that because ultimately he is our ultimate treasure.
So thanks for pointing that out today. You know, the idea that contentment isn't found in having more, it's found in recognizing that what God provides is already enough and that he is enough because he is our ultimate treasure. Lord bless you, my friend. Thanks for your call today. Nashville, Tennessee is where we're headed next.
Hi, Jeff. Go ahead. I appreciate the heart of your ministry. And several years ago, my son and his wife needed some money to build a tiny house. They built it themselves.
and we put about six thousand five hundred dollars into the project for them. And now they're selling it for a loss for their third parties buying it. He took a loan out and basically the money they received, they're paying us back for the loan that we gave them.
So it's a net loss of about three thousand.
So my two questions were one, is there any type of sales tax event that we need to pay anybody? on either end? And the second is, is there any personal tax ramification for my son who's giving us the money back or for us receiving it? Is it just an investment loss or is it something different? Yeah, yeah, got it.
No, there should not be any sales tax due on the property. It just that doesn't apply here unless it's classified as a vehicle. You know, so if the tiny home is on wheels or titled as an RV or a trailer, the DMV could charge sales tax. But, you know, if it's on land and treated as real estate, then, you know, there's no sales tax in that typical sense. With regard to income tax, the only thing that could possibly be is capital gain.
But in this case, we've got a $2,000 loss.
So there would be no tax due because it's a personal use property. He doesn't get to deduct that. But the bottom line is it doesn't sound like there'd be any tax due on this whatsoever. Awesome.
So tiny house, tiny loft. Yeah, unfortunately. Hopefully, it served its purpose, though, and maybe now they can move on to something better. Absolutely, they did. Yeah, thank you, Rob.
Well, and you as well, Jeff, and thanks for your kind remarks about the program, sir. God bless you. Let's head over to Tennessee and talk to Carla. Go ahead. Thank you so much for being on the air today.
I can only reach this channel down here at my camper. On the radio, and so I'm very thankful.
So, on my way here, I stopped to pay cash. It was something, you know, and I had I gave them a $20 bill. They couldn't give me change. They said, We don't do cash, but we can take your t money. We'll just have to keep all the the extra, you know.
And so, they forced me to use, you know, plastic. And my next question is: so, I've gotten a conversation this morning with somebody about Bitcoin, wanting to invest in Bitcoin. And so, just this whole crypto money, Bitcoin. Exchange as Christians, where do we stand? What's our best position on this and dealing with it?
Yeah, I think it's a great question. And, you know, with regard to crypto, Bitcoin is clearly the one that has emerged. It's the oldest. It's the most recognizable in the crypto space. It has gone mainstream.
You know, a lot of people looked at it like digital gold as a store of value to protect purchasing power. We did see a divergence between Bitcoin and gold more recently.
So it's not acted in the same way as we would have expected if we look at it through a digital gold lens. But I think the reality is that, you know, it's here to stay. The idea that the blockchain technology is something that is going to be with us and there's wide application for it. I don't think it's something we should be concerned about. Ultimately, as we look at what Bitcoin is, it's a decentralized way out of government control to to have something that checks most of the boxes of functional money.
And in direct contrast to inflationary monetary policies, which we're seeing around the world today, it was designed to be sound money. I would be careful though on investments because it's very speculative. Let's talk about that a bit more off the air. Big thanks to my team today, Dev and Robert and Taylor. We'll see you next time.
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