Handling Economic Uncertainty with Brandon Sieben

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Proverbs 3, 5 and 6. Hi, I'm Rob West. Christians will agree that no one but God knows the future.

But how then shall we handle that uncertainty, especially the economic uncertainty? Brandon Sieben joins us today with some helpful advice and then it's on to your calls at 800-525-7000. That's 800-525-7000. This is faith and finance, biblical wisdom for your financial journey. Well, it's always a treat to have Brandon Sieben with us on the program. Brandon is chairman of the board at Compass Finances God's Way where they've been hearing from people who are having a hard time with our current economic uncertainty. Brandon, great to have you back with us. Thank you for having us back on the program, Rob.

Well, I always enjoy it and I'm delighted to dive into this topic. Economists have been calling, of course, for a recession for well over a year now and it hasn't happened yet. So, Brandon, why do you think folks are so worried about the economy these days? Recession's part of the issue. There's also concern around a number of other things as well. The upcoming election here in the U.S., inflation, high interest rates, and then a number of geopolitical issues like what's going on with China and Taiwan or in the Ukraine or even the issue in the Middle East right now.

Yeah, and that really runs the gamut, of course. How are these folks dealing with this uncertainty? Uncertainty for these folks, for a lot of folks that we deal with leads to fear, especially for those that are on a fixed budget or struggling or without a surplus. These issues, as you know, tend to have an immediate impact on their ability to survive or even provide for their family. So the fear can lock folks up and they become either indecisive with money or, worse, take risk with money, ill-advised risk, and they may forget whose money it is and what their role is to honor God with money.

Yeah. So let's look to God's Word for some practical help with this. How are you encouraging folks who are struggling with economic uncertainty to address it? We always encourage them first to go to prayer and seek God's wisdom. And then in Scripture, there are a lot of places to go. Two great places would be Deuteronomy 8, where God talks about his purpose for us when we're in crisis. And then 1 Corinthians 3, 7, which talks about God's role in providing and what our part is relative to doing what he commands us to do in this area of finances. And then practically speaking, we always encourage folks that are uncertain or in fear to use this as an opportunity to tighten their budget, maybe reduce spending, go after the debt to bring that down, and maybe use this as a time to build up their emergency fund if they're in fear about what's to come in the future.

Yeah, that's great advice. And really, this is an opportunity to demonstrate our trust in the Lord during these uncertain times, which is an incredibly powerful witness to the world that's looking on. Now, Brandon, what about someone who might not be thinking at all about the future?

Sure. Well, there is another side of the coin, and definitely for those with extra or maybe more investments, this may be an opposite issue for them right now. Markets have recovered, their investments may be doing well, and there could be some greed or pride beginning to set in, you know, them thinking, hey, I did this.

Maybe it's time for me to go all in. Yeah, let's finish by looking at God's Word and how you would advise these folks. Well, it's the same basic advice.

Number one, stay balanced, you know, be committed to your financial plan. Maybe this is a good time to take some off the table, the Joseph Principle, and then stay humble. The same scriptures apply, and specifically out of that Deuteronomy 8, 18 says, You shall remember the Lord your God, for it is He who gives you the power to get wealth. So stay humble. God's providing and not us.

We're merely watering our planting. Yeah, that's exactly right. Now, Brandon, I know you all at Compass Finances God's Way have some resources you'd like to share that I think would be particularly appropriate here. Yes, for your listeners who have access to the YouVersion Bible app, which is a great resource. It's free. We have several five-day reading plans to help around these topics.

So if somebody's dealing with crisis, or if somebody's looking for how do they find contentment in their finances, a lot of these topics we have on that app, so I'd encourage them to go check that out. Excellent. Brandon, always appreciate my time with you, my friend. Thanks for stopping by today. Thanks so much, Rob. God bless.

God bless you as well. That's Brandon Sieben, Chairman of the Board at Compass Finances God's Way. You can learn more at compass1.org. That's compass1.org. All right, your calls on any financial topic are next at 800-525-7000. That's 800-525-7000.

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That's eventideinvestments.com. We're back. I'm Rob West, and this is Faith and Finance. Thanks for listening today. Thanks for taking the time. As we head into our calls and questions, I want to take a moment to ask you if you've downloaded the Faithfi app.

You can use it on your desktop or your mobile device. All right, let's head to the phones. By the way, if you have a question, just call 800-525-7000. That's 800-525-7000. We look forward to hearing your story and being invited into what God's doing in your life so we can help you think about the decisions you're making as a steward of God's resources and bring biblical wisdom to bear in the process.

Let's go to Cleveland, and Tom, you'll be next up, sir. Go ahead. Yes, a real quick question. It's pretty simple, but because of the devaluation of the dollar with the BRICS situation now and the concern that it's going to have a major factor. Didn't know what to do for our 401ks. It's going to affect it down the road and what to kind of invest or look at or protect us as a Christian and looking at do we invest in gold or we invest in other things that protect us so that we don't lose anything. You know, as it is with inflation being so high, that's a major concern. Yeah, it's a great question, Tom.

And you know, I've thought a lot about this. And, you know, I think particularly with the BRICS, the challenge is that two of those countries are Russia and China. And, you know, China's got some real challenges. I mean, they've got a real estate bubble right now that's bursting. They have an over dependence on real estate.

I mean, you can see that in some of these ghost cities that they've built. They have high private debt. Their population problem is worse than ours because of their one child policy.

They have a significant trouble with the rule of law. And we've never had an authoritarian, authoritarian dictatorship as a reserve currency. You just simply have to be trusted by the global markets. And so that's why the U.S. dollar is the de facto reserve currency. It's involved still today in 90 percent of the foreign exchange transactions. And we're still the most trusted. Now, you could say we're losing some confidence to who? Well, to the yuan, to the yen, to the euro.

But you normally don't lose that status unless you lose a war. And, you know, I think the other issue here is just you have to look in the rearview mirror and say, OK, if not the U.S., then who? You know, it's kind of like that joke of the, you know, the two guys that are out in the woods and they see the bear coming and one of them stops to tie his running shoes and the other one looks at him. He says, you're not going to outrun that bear.

And he says, I don't have to. I just have to outrun you. You know, it's that idea that, you know, we're looking in our rearview mirror saying, OK, who's behind us? And, you know, as long as we outrun the yuan and Japan hasn't grown in 25 years and Europe's not growing, you know, I think for that reason, there's probably rather than just a, you know, some sort of collapse or sudden change. I think it's probably a slow leak out of the U.S. and that is a result of some of our fiscal policies, this massive deficit that we have and the mounting U.S. debt.

But I don't think it's going to happen anytime soon. So what do you do with that, if I'm right? Well, I think you stay the course. I think the best way to offset the effects of inflation and continue to grow your wealth is to be in a properly diversified stock and bond portfolio. And yes, you should have some allocation to gold, but I wouldn't overweight there. I mean, I think I'd have no more than five to 10 percent. It just doesn't perform as well as stocks and bonds.

You know, it doesn't have any income. And, you know, at the end of the day, it's a fear trade. So it's a way to have more diversification. You know, you're uncorrelated to the stock market. And so therefore, if we did have a major correction or a crash, I think we'd recover. Even if we had a debt crisis, we'd recover like Europe did in 2012, 13, 14, 15. But we wouldn't lose our currency status.

I don't think it would just be inflationary. So I think at the end of the day, you stay your course. You have an allocation to stocks. You don't play into the fear trade, you know, with your all the ads you're seeing on TV.

And, you know, you still keep invested in stocks and bonds. That's my best advice. Give me your thoughts on that, though. I think that's an excellent because that was the idea. I was just like, OK, Lord, show us exactly what to do. And, you know, that was something that's important, you know, to just as a good steward of his money, not our money, but his money. And that's the most important.

So that does answer the question. And I think that that does get the nail on the head, so to speak, to kind of look at things and just stay put where we're at and just, you know, listen to God and keep focusing. Yes, sir. Yeah, absolutely.

Well, I appreciate it, Tommy. Clearly, you want to be a wise and faithful steward. I do.

Everyone listening to this program does. And so we seek God's counsel and wisdom. You know, we don't want to be our heads in the sand. We want to, you know, be like the sons of Issachar who understood the times. And so we need to be alert and following the leading of the Lord, trusting in God, not in the economy or a stock portfolio or a bank account, but trusting in God. But we also want to be wise in how we manage God's money as well. And so that's where the multitude of counselors comes in.

But hopefully that's helpful, at least giving you a few things to think about. Thanks for being on the program today, sir. Let's go to Mississippi. Randy, go ahead, sir.

Hello. Yes. I would like to do a small group with my church about doing your finances God's way.

You know, sort of instructional to anybody that wants it. Yes. Because I see a great need and I see a great need for people as far as their finances and things like that. And I wondered if you had any programs, information, workbooks, whatever that I could deeply purchase or whatever to use the material for the small group.

Yeah. A couple of thoughts. Number one would be if you want really kind of the blocking and tackling, if you will, of financial management through a biblical lens, how to set up a spending plan and the dangers of debt and the importance of saving and living within your means and those types of things. Our friends at Compass Finances God's Way, I think, would have a great resource for you.

If you want to go to, on the web, Compass and then the number one dot org, CompassOne.org, and that's the one, the numeral. So that would get you started, I think. And they've got a number of great resources that I think would help you get on your way in this particular topic. And those studies can be done in a small group type setting.

So that would be number one. If you want something that really is going to help in kind of the heart side of financial decision making, our new study called Rich Toward God at FaithFi.com would be excellent. It's a four week study on the parable of the rich fool. But if you're really looking for more of kind of the basics of money management through a biblical lens, I think that's where CompassOne.org could be really helpful to you.

Okay, yes, I'm mainly looking towards that. But in with that, I want to integrate people's hearts. We had a small group one time, they talked about tithing. And I told them, I said, you know, do you tithe 10%?

Do you tithe undergrowth? And I told them, I said, you know, I'm going to go throw a wrench into everything. I said, the first 10% is God. I said the other 90% is his, too. That's exactly right.

That's exactly right. Well, I think you're doing a great thing here. Your church will be blessed by your leadership in this area. The study at Compass is called Building Your Finances God's Way. Building Your Finances God's Way. And it covers earning, spending, giving, getting out of debt, investing, teaching children, having an eternal perspective, finishing well. And it's, you know, there's six chapters in it.

So it'd be great for a small group. Find it at CompassOne.org. Hey, thanks for your call today, Randy. We appreciate it. We're going to take a quick break, folks, back with more of your questions after this. 800-525-7000.

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This is Faith and Finance. I'm Rob West. All right, let's dive back in. We're going to take your questions in this segment.

800-525-7000. Let's go to Westfield, Indiana. Hi, Allison. Go right ahead.

Hi. I have a question about the comparison between the TSP and an IRA. Like, are there differences in how you can use the money or when you can take it out or anything like that?

There really aren't on those two things that you just mentioned. I mean, they're both pre-tax retirement savings vehicles. The TSP, the Thrift Savings Plan, is just the government form of a 401K. So think 401K, except in the government environment, it's called Thrift Savings. And it offers several options for investing, just like a 401K would. The IRA is similar in terms of the tax treatment. IRA is standing for Individual Retirement Account. But you have many more options for investments because depending on where you open it, you can basically invest it in anything.

Any stock, bond, mutual fund, exchange-traded fund. You're not limited to the investments inside the plan like the TSP or the 401K. Now there's one big difference and that is the TSP offers matching contributions while an IRA does not. So with a TSP account, the first 3% is matched dollar for dollar by your agency or service. The next 2% is matched 50 cents on the dollar. So if you put 5% of your basic pay, your agency or service contributes an additional amount equal to about 4%, I think it is, of your basic pay to your TSP. And that's free money. So if you have the opportunity, I would certainly maximize that.

Now in terms of how and when it has to come out, exactly the same. So it grows tax deferred. You can take it out without penalty after 59 and a half. As you take it out, it will be added to your taxable income and you'll have a required minimum in your 70s. Today it's 73.

You know, for those born after 1951, it's eventually moving in 2033 to age 75 that you'd have a required minimum, but that applies to both. Is that helpful, Allison? Okay.

Yes. And so I'm in a situation where I'm not eligible for the matching. So really there's no problem being in an IRA rather than the TSP. It's not necessarily a better option.

No, not necessarily. I mean, the only other difference would be the contribution limit. So you can put in $23,000 into a TSP this year, 2024 versus the IRA. The IRA contribution limit for the year is only $7,000 for those under age 50, $8,000, 50 and older. So you can just put a lot more money away on the TSP.

So if you're trying to save, you know, we would generally recommend 10 to 15% of your income. You may bump into that contribution limit on the IRA and still want to put more money in. And that would mean you'd have to take advantage of the TSP to do it.

Okay. Are they both limited separately or would I be limited with the total? No, they're separate. Yeah, it's a great question.

So you can do up to $23,000 in the TSP and then separate from that, you can do up to $7,000 in the IRA. They don't factor into one another. Okay. All right. Thanks for your call. You are welcome. Thanks for being on the program. Let's head to Spring Grove, Illinois. Hi, Sherry. How can we help? Good.

I just have a question. My husband recently passed away and was always a very good steward of our finances. And so I don't have any house payment.

I don't have any bills. But I have a very large sum of money that has come to me after his death. Everything else we had prior to his death has been invested and don't know if I should be investing in annuities or take that money and split it up. He did all the financing, so I don't know what to do with it.

Okay. Well, first of all, I'm so sorry to hear about your husband's passing. You know, it's encouraging, Sherry, to hear that he's providing for you even after his death because you all were such great stewards. And that's, I think, the fruit of being well planned.

None of us know when the Lord is going to call us home. And I realize this is a large burden that's now been placed on you as he was giving primary oversight to the finances. You know, I think having an advisor who could journey with you, somebody who really understands your faith and understands God's word, but also could bring really skilled counsel in helping you think through this large sum of money that's coming your way. Being able to protect that, but also invest it in a way that makes sense so that it could continue to grow, offset the effects of inflation, but provide for you alongside Social Security and anything else you'll have coming your way.

Perhaps down the road. Annuities are not my first choice. I mean, there are a place for them in some cases for folks that want to transfer risk away from the markets. But I think for most folks, being able to just save and invest in a way that you can match the risk tolerance and the needs aligned with your values to the investment strategy. I think will just make the most sense, giving you still access to the money as you need it over time, perhaps even in larger chunks.

If you have certain needs now or in the future and not putting that in an insurance product, which creates a lot of complexity, can restrict access to the money and limit even the upside potential on just even the investments. But I think that's something you could talk through with an advisor. Do you all have a financial advisor that you used as a couple? We had two different ones.

One was through Schwab and another one was through JP Morgan. But he had left me a note in our folder that if anything happens to me, you need to talk to somebody different. We need to diversify. And I don't know what that really means except to add another person to the layer because we have so much invested in those other two that he knew when this was coming that I needed to talk to somebody else. So I'd be happy to talk to another person. Yeah, I think that would be good.

And I'm not opposed. I mean, I certainly understand the note that was there and I don't know the full rationale for what he was thinking, but I'm not opposed to you having one trusted advisor who's really walking alongside you being that sounding board and wise counsel overseeing the investment strategy that could be among multiple managers, whether those are mutual funds or separate accounts not to get technical. But I think having one trusted advisor that can journey with you and help you coordinate both the tax side, the estate side, your budget and your spending and lifestyle expenses, but also your investment strategy for this wealth that you're stewarding. And that's where I think a certified kingdom advisor could be very helpful. You could head to our website at faithbuy.com that's faithfi.com right there at the top of the page, Sherry, it'll say find a professional you can put in your zip code.

I would interview two or three CKAs in your area and just find someone that you feel like is the best fit that you have a good rapport with. They're going to ask you a lot of questions and just get to know you and you know what this next season of life is going to look like and then help you make those decisions. I also want to send you a book just as our gift to you.

It's a book called Wise Women Managing Money that was written by Miriam Neff, who as a widow found herself in a situation similar to yours and wrote this as an encouragement and a helpful guide for you around this area of money management. So stay on the line. We'll get your information and get that right out to you. May the Lord bless you. Well, we're almost out of time. If you like today's program, why not share it with a friend and while you're at it, share the Faith Buy app with them as well. Help us get the word out. Thanks for listening and sharing, and I hope you'll come back and join us again next time for another edition of Faith and Finance. Faith and Finance is provided by Faith Buy and listeners like you.