Financial Plans and God's Will

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Hi, I'm Rob West. Are you and God on the same page when it comes to your financial plans? Today we'll talk about achieving your financial goals and doing God's will. Then we'll take your calls at 800-525-7000.

That's 800-525-7000. This is faith and finance, biblical wisdom for your financial journey. Well, as you know, we're big fans of planning. That's because having a plan is the best way to meet your financial goals or any goals for that matter. The question is how to make sure your plans line up with God's will for your life. That's important because if you're a Christian and Jesus is your Lord, well, you know, his plans are the best. In fact, it says in Proverbs 19 21 that many are the plans in the mind of a man, but it is the purpose of the Lord that will succeed. The purpose of the Lord will succeed. So it's worth finding out what he wants.

How do you do that? Well, as word tells us, Micah 6 8 says, and what does the Lord require of you? To act justly and to love mercy and to walk humbly with your God.

Proverbs 3 5-7 is another passage that gives us a clue about God's will for his people. Trust in the Lord with all your heart and lean not on your own understanding. In all your ways, submit to him and he will make your path straight. Do not be wise in your own eyes.

You're the Lord and shun evil. So can submitting your ways to God help you plan for retirement or save up for a car or plan a vacation? Well, you might not receive a note from the almighty telling you which car to buy. But if you're committed to living by biblical standards, you will certainly experience greater peace and confidence about your choices.

Here's the bottom line. We focus on whatever has eternal value. In other words, seek first the kingdom of God. When you're trusting in the Lord with all your heart as you pray, read his word and submit your financial plans to him, God will direct you into his will.

That doesn't mean things will always be easy, but they will be godly. Sometimes when you're praying for God's will to be done and trusting for the Lord's guidance, you might still need a bit of practical advice from someone you trust. After all, seeking wise counsel is a biblical idea.

Proverbs 15 22 says without counsel plans fail, but with many advisors they succeed. That said, we have some biblical counsel for your plans in the area of saving, debt and employment. First, saving. Paying for college or retirement or a home purchase can mean many years of diligent saving.

This takes patience and commitment. My advice is to set a target amount and figure out how much you'll need to put away each month. Put that money where it will earn the most interest and ask God to give you the discipline to stay on track. For retirement, be sure to max out any savings options offered by your employer or get going on your own with a traditional or Roth IRA. For college saving, I like 529 savings plans.

We'll talk more about those another time, but you can research them online as well. What if you're getting a late start with your saving? Well, you might be afraid you won't meet your goals because your timeline is shorter. My first suggestion is don't worry. The Bible assures us that we do not need to worry about having our needs met.

Our God is Jehovah Jireh, our provider, who cares for the sparrows of the field and even more for you and for me. Besides saving, another big goal you might have is eliminating debt. This is another area where you need a plan. Figure out exactly what you owe and make a plan to pay it off. Pay off one debt at a time, then apply the payment amount to the next debt. If you need more help, we recommend you visit christiancreditcounselors.org.

We do not recommend debt consolidation or debt settlement. Share your goals with trusted friends or family so they can encourage you and celebrate your successes along the way. Remember God's Word says the borrower is servant to the lender, and keep your debt-free goal in sight. Above all, don't get discouraged.

Ask the Lord to help you break any bad habits, and get the advice and support you need. The third area you might need financial advice is employment. Are you unemployed or underemployed? To improve your earning power, you need a new job, or possibly a promotion in your current job. One way to reach these goals is to get training and improve your skills. Be sure to network and talk to your job contacts often.

Your persistence and enthusiasm will earn you employment brownie points. Ultimately, as we said at the start, when you focus first on the things that have eternal value, the purpose of the Lord will prevail in your financial life. All right, your calls are next, 800-525-7000. As a faithful listener of the Faith and Finance Program, you know that there is life-changing financial wisdom in God's Word to meet all your needs. More than anything, Faithfi is here to help you and millions of others see God as your ultimate treasure. As a nonprofit, we're grateful for our partners that help expand our outreach every month with their generosity. Has God provided financial answers for you through this ministry? Please consider becoming a monthly partner by visiting faithfi.com and clicking Give. Paying too much for health insurance, frustrated by high deductibles and increasing premiums?

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Any financial question is in play. We'd love to hear from you. I've got three lines open, 800-525-7000. You can call right now. Let's head to Kentucky. Hi, John.

Thanks for your patience. Go ahead. Hello.

Hi there. How can I help you, sir? Well, I've got equity in my home and the house needs repairs, but I'm looking into either a HELOC, home equity loan, or a reverse mortgage. The house is then evaluated at $160,000, it says $166,400 is what the property value is on this thing from Mutual of Omaha.

And I owe about $50,000, so that gives me about $100,000 to play with. Yeah, that's right. And John, you plan on staying in this property just based on everything you know today for the foreseeable future?

Yes. Both my wife and I are elderly and just the house is built in 1921 and needs some updates. And are you looking for monthly cash flow to supplement your other income sources or are you just looking for more, regardless of whether you do the HELOC or the reverse mortgage, we'll get into that, but would you rather just have access to the equity and pull it periodically, or would you rather have more of a systematic monthly check in your mailbox? I know there is money available and we are kind of at about $4,500 altogether, her income and mine, kind of living hand to mouth. We have a little left over, but there's no emergency cushion, so we need something. Yeah, got it. Okay, well, I like the reverse mortgage option a lot.

I don't like the HELOC option a lot. It's not a solution, the reverse mortgage for everybody, but it is a tool to be considered because this is your largest, probably your largest asset that you have today, or at least one of them. And being able to think about how to leverage that in this season of life to maintain your quality of life and whatever lifestyle God has called you to without being constantly right up to the edge in terms of your spending and your margin, having some surplus. So the nice part about the reverse mortgage, John, is if you're over the age of 60, you got at least 50% equity in your home, which you do, you got quite a bit more than that. What you would be able to do is have them, you could get it as a line of credit, but in your situation, I'd probably recommend that they give you a monthly income stream through the reverse mortgage. So they would look at the amount of equity you have, which you said, I think is about a hundred thousand. They'd look at your age and they would say, okay, based on your age, John will give you X amount of dollars every month for the rest of your life. And if you pass away, your wife doesn't have to move out of the house or anything like that. And once both of you passed away or you sold it, then whatever that mortgage balance is, and it would grow over time because you're pulling out that monthly check and it has an interest on top of it, but that would be paid back.

But here's the beautiful part. There's no monthly payment. So whatever you receive in the form of that reverse mortgage monthly income is just what you could add to your total monthly income for all of your bills.

And maybe that helps you build up your emergency fund. And the other big piece about the reverse mortgages, in addition to the fact there's never a payment to be made, is that it's non-recourse debt. So the government is guaranteeing the loan. And if the loan, let's say you live to age 150, and let's say they paid out to you in the form of that monthly check more than the home was worth because the home lost value.

It probably wouldn't. You probably won't live to age 150, but just go along with my scenario here. If you did and you ended up borrowing more against the home than the home was worth, the government's going to step in when you pass away or when you sell it and pay off the balance. So you'd never personally be liable for anything beyond the collateral of the home. Now if you don't pull out as much as the home is worth, then whatever is left after the mortgage is paid and the home is sold would be available for your heirs to pass on or to give away. So I think this could be a great tool because it helps you accomplish what you're trying to accomplish. And that is we need a little more monthly income. We need some margin.

We need to build up an emergency fund and our only asset available is our home. And we want to stay here and that's where a reverse mortgage, if it's a home equity conversion mortgage, that's a specific type of reverse mortgage, could be very effective. Does that all make sense though?

Yes. So I see my children would not be stuck with something after our passing away. That's a good point. They have a good projection on the paperwork they sent us that the house valuation, this is just totally speculation, that in 20 years could be worth $273,000. Well I wouldn't be surprised because, yeah, because real estate in this country has been appreciating quite rapidly and it's not a bubble. It's because we just don't have enough homes in this country. We have more demand than supply and that's economics 101. So I think you're right.

The home will continue to appreciate and it's likely to appreciate faster than even the interest rate attached to the reverse mortgage. Are you comfortable using the internet, John? A little bit.

More of a Luddite than an aficionado. Okay. Well let's do this.

You stay on the line. Our team will get your information. We'll get somebody in touch with you to explain more. Our friends at Movement Mortgage, a national underwriter of this program, are specialists in this area. They're all believers. It's a faith-forward organization in all 50 states.

They do conventional mortgages but they have a whole department that specializes in reverse mortgages and there's a lot of folks advertising about reverse mortgages and I wouldn't feel comfortable with you just pulling somebody off randomly and so I'd feel a lot better about you at least consulting with somebody who's a trusted counsel. So if you want to stay on the line, we'll get your information and get somebody in touch with you. Okay? Thank you, John, for calling today. God bless you. Let's see. Let's go to Georgia. Ron, thanks for calling.

How can I help? Hey, I'm 66 and six months almost, I think, and dealing with Social Security and I took my Social Security last year. I started it in June of last year so I'm within a year and I'm thinking about withdrawing from that and reapplying later, maybe in another few months, a year or something. Some period after I've reached my full retirement age.

So what's your advice in that and what's the drawbacks or anything that I may have some concern about? Yes. Are you within 12 months of having started that benefit? Yes, I am.

Okay. Yeah, so that's good news. You should be able to withdraw your claim for Social Security benefits if you do it within 12 months of the date you were first entitled to benefits and were not yet at full retirement age. So there's a form for that at SSA.gov. If you did that, you'd have to repay money you already received, including Social Security payouts as well as payments the program made for you and that could include Medicare premiums and payments made to a spouse or a child on the account.

And you can only do that one time. The benefit would be that you're just letting that check continue to build. And if you're in a situation where you don't need the money, that could be really helpful because you know, you love to have a higher check for the rest of your life and waiting until at least full retirement age or even beyond that, up to age 70 could give you a check 8% higher for every year you wait. Does that make sense?

Yes, it does. And, but I'm within like a month or so of being my full retirement age. Well, I think the key would be just, you know, you're not going to have much of a difference, but if you were going to wait beyond full retirement age, you could have wait till age 70 and get 25% more. So I think you just need to determine is it worth it?

How much am I going to get and how long am I going to delay and factor all of that into your budget? Hey, thanks for your call today. This is Faith in Finance.

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That's 800-525-7000. Before we head back to the phones, perhaps you'd listen to this program regularly. Maybe the Lord has used it in your life and you've been impacted by these principles from God's Word and you'd like to support our work, we'd certainly invite you to do that and especially now over these next weeks. This is an important time for us to hear from our listeners as we head toward our listener funding goal. We started with a goal April the 1st for the last 90 days of the fiscal year leading up to June 30th with a goal of 175,000 needing to be received. And the good news is you all have responded. We are so grateful for the giving that has taken place at this point. We've already seen nearly 100,000 of that come in, which is an enormous blessing. But we still have a little ways to go.

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Thanks in advance. All right, let's head back to the phones to Indiana. Hi, Michael. Go ahead, sir.

Hello. I just had a question on Social Security as to when to start receiving or taking benefits and the guess the pros and cons of taking it at 66 and six months, which I believe is when I'm eligible versus waiting until 70, which I do intend to continue working through those years. Yeah. What are your thoughts?

Yeah. You know, we generally advise folks who don't need the money and that would be, it sounds like your case because you are going to continue to work until at least age 70 based on everything you know today because you're going to get this guaranteed increase of about 8% a year for each year you wait. And in fact, it's one 12th of 8% of an increase every month. And so that idea that you could have, you know, in three and a half years, you know, you could see that check grow, you know, by a pretty good bit, I mean, 28% higher than what you were expecting to get at full retirement age, and then get that for the rest of your life is a nice thing, because guaranteed income is, is really nice in that season. And you know, it really comes down to how long you're going to live, which of course, none of us know the day or the hour the Lord is going to call us home.

And yet, if you live, the numbers come out about 12 years. So if you live until at least age 82, you will be paid back for everything you gave up between 66 and seven months and age 70. And you'll have that check 28% higher for the rest of your life. And that's a good thing, because with the rising cost of healthcare and just the other things you might have in that season of life, you know, you might really value that extra income down the road. So I think that's where again, if you don't need the money, and you're certainly not going to get a guaranteed increase in the stock market. The only question is, am I going to live long enough to be paid back so I can enjoy it?

You know, and that obviously is the unknown. But I think in most cases, if you're in relatively good health, you know, you could make a case that it makes sense. Do you follow that?

I do, I only have one other part that is as far as the decision. And that is the idea of, and again, I don't quote unquote need the money, but I do not have my home paid off. So the thought was if I took that monthly check to put toward debt and use three years of that, probably $90,000 or so, would make a difference in the mortgage and ability to pay that off. So that was really probably the primary consideration as to why it might. And I can certainly understand why you'd want to do that. And if you just have a conviction to be debt free as soon as possible, then I'd say go for it.

Apart from that, if you're just looking for, you know, hey, we'd like to be debt free as soon as we can, but I want to do what makes the most financial sense. Well, then I think you can look at it just in terms of crunching the numbers. What is that interest rate on your mortgage?

We refi'd at a time when things were good, it's right around 3%. Okay. Yeah. So you've got a great rate on it. And if you just continue doing what you're doing right now, and if you're sending any extra just out of cashflow without having social security, if you were to continue doing that and you may not be, and that's fine, how quickly do you think you'll have this paid off just based on what you know today?

Well, that's just it. When we refinanced it, we did another 30, and so unless we did, and I do send extra every month, but not huge, it's not like doubling or anything, and so it's not going to be paid off within the next 10 to 15 years. If we did do what I was thinking, certainly it would accelerate it, but even at that I'm not sure it would be paid off like in this five, seven years, something like that. Got it.

So the other factor that, again, as you said, we don't know the day or the hour, but genetically I have on my side of the family several people that lived to 90 and or 100, so who knows? But if that's ordering through, I could receive those benefits for a substantial amount of time. Yeah. So I think all things being equal, let me just ask, last question is how do you and your wife feel about the debt? Is that something that just, as you think about it, pray about it, you're really wanting to get out of that? Or is it really more about what just makes the most financial sense, and even though we'd like to be out of debt, we're willing to hang on to this a bit longer if that makes more sense on paper?

Yeah. Again, not to complicate, but I think it's a little bit of both in that we would love to be debt-free, but I think we're even willing to consider downsizing selling the house, which would allow us to pull out a substantial amount of equity and become debt-free that way as opposed to just the idea of accelerating it as we discussed before. Okay. Well, I think from everything I'm hearing, I mean, ultimately you're the steward, pray through it, you and your wife together come to a conviction and go for it, and I don't think you can go wrong with any of these, so let me just say that.

I think just based on what I'm hearing, given the longevity in your family, given the fact you're planning to work, you don't need the money, and you have a really attractive low mortgage, even though it's going to go on for quite a bit of time because of that refi, that low 3% rate alongside the fact that you're going to get that guaranteed 8% increase and that 28% higher check for life that could go into your 90s and even beyond, I just think that at the end of the day is going to make more sense, especially given your willingness to think about even downsizing. So I'd probably come down on that side of the ledger, but I don't think you can go wrong with either of these if that's helpful. It's very helpful. I appreciate your wisdom and all that you do. Thanks and God bless all that you do. Thank you, Michael. I appreciate you saying that. God bless you, sir. Folks, if you'd like to support our work here as a listener supported ministry, this is a really important time between now and June 30th. Just go to faithfi.com and click give. That's a tax deductible gift and we'll certainly be grateful. Let me say thanks to my team today, Devin, Patrick, Jim, Henry, and Robert Youngblood. Couldn't do it without them. Plus the rest of the team here at Faithfi have a great day and come back and join us tomorrow. Bye-bye. All information and finance is provided by Faithfi and listeners like you.