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Zechariah 4.10 reminds us, do not despise these small beginnings, for the Lord rejoices to see the work begin. Hi, I'm Rob West. When money is tight, giving more, saving more, or paying down debt can feel out of reach. But financial progress doesn't always begin with a giant leap.
Sometimes faithfulness starts with one small step at a time. Today, Brian Holtz joins us with four practical ways to begin creating margin. And then it's onto your calls at 800-525-7000. This is Faith in Finance, biblical wisdom for your financial decisions.
Well, it's always a privilege to have my friend Brian Holtz back with us. Brian is the CEO of Compass Financial Ministry, founded by our good friend and former host of this program, Howard Dayton. Compass helps people around the world grow as faithful stewards by applying biblical wisdom to the way they earn, spend, save, and give. Brian, great to have you back. It's always great to be here, Rob.
Brian, when money is tight, it can feel difficult to make progress, especially when you want to give generously and save wisely. What encouragement would you offer someone who feels like there just isn't enough margin to do both? Yeah, Rob, that really is tough. You know, whether they're in that position because of past choices or forces outside of our control, gaining that first little bit of margin seems to be the hardest.
So I'd love to share four tactical moves that can spark that first bit of progress. Step one is to start with prayer.
Now, I know that doesn't sound tactical, but it is. James 1:5 promises that God gives wisdom to those who ask. Tell him that you want to follow his ways, but you've hit a roadblock and you need his help, and he will respond. That's right.
Now, we'd all love for it to be extra funds in our bank account, but it's usually fresh insight. You'll start to spot new options and meet wise people. But one way or another, God will answer those prayers. Yeah, that's well said, and absolutely right that we need to invite God into our financial lives. Yeah.
And we often miss that step. All right, what's step two?
So second, people need to think smaller, but longer. Slim margins can certainly delay the quick wins and the progress we really want to feel like we're making, but they don't stop us from making steady, long-term progress. Maybe you want to give 10% for all the right reasons, but you can't.
Well, start with 1% or maybe even less and work your way up. Remember, Jesus praised the widow who gave two tiny copper coins, not because of the value, but because of the heart she had behind it. Same thing with saving. Tuck away $5 or $10 a week if that's all you can do. But tiny steps will still cover that same mile.
It just might take more of those steps. That's well said.
So start with prayer and then think smaller but longer. And what's step three? Step three is really to aim the windfalls that you have at making monthly or weekly margin.
So, think about tax refunds or that fifth paycheck month that you get, maybe a rebate from something you bought at the hardware store, and use them strategically to drop monthly costs.
So, maybe you knock out a small bill that frees up $10 or $20 a month every month, like paying off your phone or maybe a department store credit card that you used at one time. Before you tackle those big debts, knock off the little ones. That first freed-up payment becomes fuel for the next steps that you want to take. Yeah, it's almost like a mini snowball method. Small focused steps, but building momentum over time, right?
Absolutely. And that's the play when money's tight. The fourth and final step is shopping with a strategy. Stock up on the essentials when they're on sale. Pay top priority bills first and trim out the non-essentials.
So if chicken's half price today, grab two packs instead of one, but only if you're going to actually use them. Pay your housing bill before you go to the extras. And maybe that means some months you have to skip the streaming service, but that's better than missing out on a rent payment. And wants generally cost more than needs. Choosing needs before wants honors God and grows that margin like we're trying to do.
Really great suggestions. I know Compass has a resource that is specifically designed, Brian, to help people navigate a tight budget, right? We do. It's a video study called Making Ends Meet. And it's designed to help people find that first little bit of margin and begin their financial discipleship journey step by step, even when they're starting at the bottom.
And you can find that resource along with many others to help you steward God's money wisely. Just simply head to compassfinancialministry.org. That's compassfinancialministry.org. Brian, great to have you with us today. My pleasure, Rob.
That's Brian Holt, CEO of Compass Financial Ministry. Financial progress rarely happens overnight.
So start small, stay faithful, and let each wise decision create a little more margin for the next. Back with your questions after this. Stick around. 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. Are you feeling overwhelmed by credit card debt? As followers of Christ, we are called to be good stewards of what God has given us. That's why our trusted partner, Christian Credit Counselors, is here to help.
Their debt management program can help you pay off your debt 80% faster while honoring your commitments in full. Take the first step toward financial freedom today. Visit faithby.com/slash CCC or call 800-557-1985. Yeah. I'm so glad to have you with us today on Faith and Finance.
Do you have a question today in your financial life?
Well, we've got lines open. We're ready for you. We'd love to take your call at 800-525-7000. We've got, it looks like four lines open right now: 800-525-7,000. Whatever is on your mind today, whether it's your lifestyle and your budget, maybe it's the best way to pay off debt.
Maybe you're struggling with that credit score. You're getting ready to buy a house or get a car loan and it's concerning you. Maybe you want to give wisely, especially this time of year. And maybe you want to do a qualified charitable distribution out of your IRA.
Well, any of those topics and more, we'd love to chat with you about. The number 800-525-7000, you can call right now. Let's begin in Illinois today. Charnay, how can I help? Hi, Rob.
So I have a question. My husband is in a nursing home right now. He's been there for four years. I do draw my Social Security, and now he gets mine was bigger than his, so now he gets that, and that goes, of course, to the nursing home. I was told by someone that Once I retire, if I bring home over $4,000 a month, that I would have to start doing a spin-down.
And I would have to contribute to his monies, you know, to pay for his stay at the nursing home. I don't know if that's true. And the second part of the question is, Can I take some of my four hundred one now and put it towards my mortgage? To offset how much I would have to give to the nursing home? Because he's on Medicare Medicaid now.
Got it. Yeah, great question.
So it sounds like you're referring to what's referred to as a Medicaid spend down. And essentially, it's really going to depend on whether your husband is on Medicaid or paying privately. And what state you live in, because rules vary by state. Is he actually on Medicaid or is he paying for the nursing home privately? No, they just get his social security check.
Okay. Uh yeah, so that's going directly to the nursing home, correct? Yeah, yeah, so he's not private paid, no.
Okay. All right. Yeah. So I think the key there is if he's in a nursing home on Medicaid and his social security check is is already being paid to the nursing home, which is how generally how Medicaid works, then you're allowed to keep your own income.
So, your retirement income is not automatically required to be paid to the nursing home simply because your husband is on Medicaid. His income, Social Security and pension, is applied toward the cost of the care. That's the way that works after certain permitted deductions. There are special spousal impoverishment protections that allow a living spouse, you at home, to retain certain income and assets. But regarding your question about the money from the 401k, you know, I would get some professional advice on that.
A 401k withdrawal could create taxable income that could affect that Medicaid eligibility. You know, paying down the mortgage, I love that idea generally, but you would want to talk to an elder care attorney because, again, those rules do vary by state.
So, I'd probably get some counsel on this before you do anything because what you would not want is for you to do something that inadvertently jeopardizes that government assistance that's coming through Medicaid, anything remaining after they get his Social Security. Does that make sense? It does make sense.
Now we was estranged, but we're still married when he went into the nursing home four years ago, and I don't think that has no bearing because legally we are still married. Yes, exactly right.
So, if you are still legally married, then Medicaid is going to treat you as spouses. Even if you're living apart. But I would say the exact rules and whether your income or assets are considered are going to depend on the Illinois Medicaid regulations and the circumstances of the separation.
So again, I think you're going to want to check with somebody who can advise you on that professionally.
Okay. Thanks, Rob.
Okay. All right. Thank you, Charnay. Call anytime if I can help. And we appreciate you being on the program today.
Steve, go ahead. Hi, Rob.
Uh, thank you for taking my call. I'm a long time listener. I used to listen back when Larry Burquette started the show.
So. Oh, cool. Really, really loved his advice, and I love your godly wisdom too.
Well, thank you. I appreciate you mentioning Larry Briquette. Absolutely. Um so my question is uh I have an emergency fund. Uh set up.
And I had it in a savings account, had it there for a little while, wasn't collecting much interest. tried a C D for a couple of months Same thing, not able to get to it. You know, it had to be matured and whatnot. Just wanted to know what your thoughts were on putting my emergency fund into a money market mutual fund. Mm.
Yeah. Yeah, the only downside is the Money Market Mutual Fund, while it pays a higher rate of interest typically than a traditional savings account, it's not FDIC insured.
So, the value can technically fluctuate slightly, although it's extremely rare. And withdrawals can take a day or two. It's not instant like the bank.
So, while very safe, it doesn't have the guarantee of a bank account.
So, for some folks, that's a deal killer. For others, they say, no, it's such a modest amount of additional risk. I would rather get that higher yield. That really is my primary objective. And I think if that's the case, then I would say, yeah, the Fidelity government money market or the Schwab Value Advantage money market or even a Vanguard federal money market fund.
Those can be great, give you a little bit more yield. You just need to understand that you don't have that FDIC insurance and you don't have immediate access to the money like you do with a bank product. I see.
Okay. All right. Yeah, my risk adversion, I'm okay with the FDIC. Um but if I needed it right away, you're saying it would be a day or two. Typically, yeah, because you've got to wait for the transaction to settle and clear, and then you could take a withdrawal at that point.
So it's just not immediate like it would be with a savings account. You know, in terms of the funds, you know, having a problem, they call it breaking the buck because basically what happens is the idea behind a money market fund is it always is priced at a dollar per share. It's only happened once that I can think of. You know, there was one in 2008 where it fell to 97 cents, you know, after Lehman Brothers. You know, they held Lehman Brothers commercial paper during the financial crisis.
And that. You know, event shook the industry and it triggered some reforms. Since then, they've made funds much safer. The SEC has strengthened the rules around higher credit quality, more liquidity. But the bottom line is, it can happen and it has happened.
And so you just need to understand that. But again, I would underscore the idea that it's extremely rare.
Okay. Well, thank you very much, and God bless you. All right. Thank you as well. We appreciate you, Steve.
And thanks for mentioning the late Larry Briquette. I walk in the shoes of some giants. Larry Briquette originally, then Howard Dayton, one of my mentors, hosted the program after Larry passed away in 2003. Howard passed it on to me in 2017. And we have an amazing team.
Boy, what a privilege to come alongside you, listeners each day, to encourage you out of God's word and your role as a steward, to give you some practical advice. And we'll continue to do that right after the break.
So if you have a financial question, now is a great time to call. The number is 800-525-7000. That's 800-525-7000. Or if you'd prefer to email your question, send it to us at askrob at faithfie.com. I'm Rob West, and you're listening to Faith and Finance biblical wisdom for your financial decisions.
We'll be right back after this break. How much money is enough? It's a question almost all of us wrestle with, but few of us know how to answer. What if God has already given us a better way to think about enough? One that leads to contentment, freedom, and greater generosity?
Our Faith5 field guide, How Much Money is Enough, will help you explore this important question through scripture and practical exercises. Get your copy today at faith5.com slash shop. That's faithfi.com slash shop. FaithFi is grateful for support from One Ascent. One Ascent believes that your values inspire why you invest and how they can inspire how you invest.
OneAssent's goal is to provide solutions designed for every need and invest in businesses that bless the people and places God has made. They want to help investors do well by doing good. To explore a new way of investing that aligns with your values, more information is available at onascent.com slash FaithFi. Taking your calls today here on Faith and Finance, 800-525-7000. Let's go down to Tampa.
Mary, go ahead. Yes, this is a social security question I have.
Okay. My husband died a while back, and I read somewhere if I decide to remarry, I can still receive his death benefits if it's uh you know I get married again. Is that true? Yes, you know, there's two different benefits to keep straight. There's the spousal benefit, which is paid while your spouse is living, and then the survivor benefit, which is paid after your spouse dies.
So, since you mentioned you're already receiving benefits based on your deceased husband's record, you're receiving a survivor benefit.
So, if you remarry before the age of 60, you generally lose eligibility for survivor benefits based on your deceased spouse's record. If you remarry after sixty or at sixty or older, you can generally continue receiving those benefits based on his record. Oh, okay.
Okay. So it wouldn't interfere with if I got married again. and, you know, my new husband if I decide to get married again. I would still get my Um, deceased husbands benefit. That is correct.
If if you're sixty uh or older. Yeah, I'm sixty six, so Okay. Yeah. Very good. Yeah.
So that's exactly how it works. You would have the ability because you're remarrying at sixty or later to continue receiving those survivors' benefits.
So you should be in pretty good shape.
Okay, all right. Thank you very much for your answer. Listen to hard every day.
Well, thank you, Mary. Call anytime to Nashville, Tennessee. Hi, Lynn. Go ahead. Hi, thanks for taking my call.
Just got a quick question about a couple of different investment things. I currently have a traditional IRA. That I contribute to myself monthly. And I was wondering, I realized that it's Going in after tax right now, so it's lowering my taxable income now, but when I have to start taking the RMDs. Then I have to pay tax on all withdrawals.
Is that correct? Yeah. I mean, typically we would say that's called pre-tax, right?
So you put it in, it gets excluded from your taxable income.
So you don't pay tax on it. And then when it comes out, yes, it's added to your taxable income as opposed to the Roth, where you get the income, you pay the tax on the full amount, and then you make the after-tax contribution, but it grows tax-free and you never pay any tax on the gains when you pull it out.
So is it more would it be more ben I'm sixty three now, probably going to work another, I don't know, four-ish years. And can it be converted to a Roth? And would it be beneficial to me to convert it to a Roth? Yeah. Yes, it absolutely could be converted to a Roth.
It would mean that you're paying the taxes now versus later. Because if we leave it in the traditional IRA, when you take it out in retirement at some point, maybe you convert it to an income stream or you start to pull it out as needed to supplement other income sources, whatever you pull out in any given year would be added to your taxable income. If you convert it to a Roth, which you can do, it just means you're paying it now instead of later. Since you're working though and earning income, generally we would not see a lot of people doing that because while you're working, you're likely in a higher tax bracket than you may be after retirement when you're not working. And so, what a lot of people do is between the age of, you know, from the year they retire until their required minimum kicks in at 73, that's usually the period of time where they start converting to Roth.
Because their income has dropped, so they're in a low bracket. And then we use a strategy called filling up the brackets.
So you could check with your CPA, or if you do your taxes yourself, you could take a look at this, but you would look each year and say, okay, how much more income can I have before I go into the next bracket? And then you could convert that amount to Roth during that year. But the idea is you probably don't want to do it during the peak of your earning years because you're already in a higher bracket. And then adding more income on top of that through the conversion is usually counterproductive. Does that make sense?
Oh, yeah. Yes, that makes perfect sense. And then my second part of my question is: I have a 401k with a 4% match, but I'm contributing more than that. And when I look at the return, amounts for the traditional IRA versus the four hundred one K accounts. the traditional is earning better.
So would I would it be wiser to contribute more into the traditional versus contributing additional into the four hundred one K. Yeah. Well, first of all, and I didn't hear you say this, but just to make sure you understand, you probably can't move any of that 401k money out until you separate from the company. At that point, you could roll it to an IRA. But if you're still working, it's called an in-service distribution.
And even, you know, generally, the plant administrators don't allow that.
So, yeah, I think the question is: do you prioritize the 401k or do you prioritize the traditional IRA?
Well, remember, the 401k and the IRA are just the account type. Which is different than the investments.
So it just so happens that the investments that have been selected for the IRA are outperforming the 401k.
So I think the first thing to do would be to go back to the 401k and say, why are those investments not performing well? And do you need to make a change and perhaps change the allocation inside that 401k? Maybe you're too conservative. Maybe you have too much in bonds. Maybe you're in a certain classification of stock that's not been performing as well as maybe what you have in your IRA.
So I would say maybe you look at tweaking that first. But as long as you're maximizing any match available through the 401k, I don't have any problem with you funding the IRA first. It's just that you're likely going to hit the ceiling on the contribution limit for the year much quicker because 50 or older, it's only $8,600. Whereas between age 50 and 59, you can put in $32,500 for 2026 in a 401k.
So you've just got quite a bit more room there for contributions.
Okay. My question was that I'm giving in I'm putting into the 401k above the 40K percent match.
Okay, is it putting more into the IRA? Instead of putting the extra into the 401k. Yeah. And I'm not opposed to that at all because you're getting your 4% match.
So you certainly could, you know, start to prioritize the IRA instead. I'm just saying, let's back up. And if the 401k is not performing as well as the IRA, I want to know why. And so I want you to go take a look at those investments or get somebody at the plant administrator to help you evaluate what you've got to see if you don't need to make a change. But separate from that, yes, I have no problem with you starting to put anything above the match into the IRA.
But remember, in the IRA, the contribution limit for somebody 50 and older is only $8,600 for the year.
So you're probably going to get to the contribution limit, which at that point, you'd have to then go back to the 401k and start putting more there.
Okay, gotcha. That makes perfect sense. Excellent. Hey, Lynn, thanks for your call today. Call anytime if I can help.
Big thanks to my team today, Pat, Taylor, and Devin, plus everybody here at FaithFi. We'll see you next time. Bye-bye. Faith in Finance is provided by FaithFy and listeners like you.
