This is an unquote presentation of Faith and Finance. Well, God's Word contains dozens of verses about repaying debt, but usually from the perspective of owing it to others.
Another example of this is Ecclesiastes 5-5. It reads, It is better that you should not vow than that you should vow and not pay. We have to dig a little deeper to discern God's will for us when someone owes us money, but one thing is very clear, the Lord expects us to act differently than the world. For one thing, if the one who owes you is a fellow believer, you should never sue to recover that money.
Paul says this in no uncertain terms. In 1 Corinthians 6, 6 and 7, he writes, But brother goes to law against brother, and that before unbelievers? To have lawsuits at all with another is already a defeat for you. Why not rather suffer wrong? Why not rather be defrauded? Of course, this applies only if the person owing you money is a fellow believer. The Bible doesn't say that you can't sue someone outside the church. If you own a business, you may someday be forced to take someone to court for nonpayment, simply to keep your business going. Now, that's not to say you have no recourse within the church.
If someone rightfully owes you money and doesn't pay, there's a four-step process for reconciling the issue. First is to put the matter into perspective. You shouldn't be surprised if another believer attempts to defraud you. Romans 3-23 reads, For all have sinned and fall short of the glory of God. With that in mind, consider how Jesus treated sinners with kindness and patience.
Avoid confrontation. A good way to do that is by praying for the one who owes you money. You might say to God, Heavenly Father, I lift this person up to you and put this situation in your hands.
Please give me wisdom and please bless this person financially so they will never feel the need to borrow in the future. Your ways are not our ways. Please use this situation to give glory to you and guide my steps. Help me act as Christ would, showing mercy that others might see and be drawn to you. In Jesus' name, Amen.
The next step is to meet with the person who owes you money. In Matthew 18-15, Jesus says, If your brother sins against you, go and tell him his fault between you and him alone. If they listen to you, you have won them over. That means keeping the matter private for now.
Don't grouse about it to your spouse or friends and certainly not on social media. The idea is to show respect for the other person so their heart might be softened. The real goal is reconciliation. Getting what you're owed is secondary.
Be willing from the outset to forego payment if need be. If meeting privately with the person doesn't work, step three is to take other Christians with you for another meeting. Jesus goes on to say in verses 16 and 17, If they will not listen, take one or two others along so that every matter may be established by the testimony of two or three witnesses. If they still refuse to listen, tell it to the church. And if they refuse to listen even to the church, treat them as you would a pagan or a tax collector. Now, that seems pretty drastic, but we're entering the realm of church discipline. It's important to understand that this isn't to punish the individual, but to help him or her see the error of their ways, repent and make good. If this person rightfully owes you money and refuses to pay, it's a sin and the church needs to deal with it. Just as with adultery or any other type of public sin, the church must exercise proper discipline or it ceases to honor God. If the offender refuses to repent, Jesus himself says they should be treated as an unbeliever. And finally, step four, you must continue to show humility, respect and love for the offender. You must remember that you represent Christ and that you trust him for the outcome.
People are watching you. Think of the situation not as a win lose proposition, but as an opportunity to express the love of Christ in a difficult situation. As believers, we should be better than the world at resolving conflict. Pray the Holy Spirit will show his power through this process, that God's will should be accomplished through you whether you're paid or not. Either way, you must forgive that person as Christ has forgiven you.
Mark 11 25 reads, and whenever you stand praying, forgive if you have anything against anyone so that your father also who is in heaven may forgive your trespasses. Much more to come just around the corner. Stay with us. We're grateful for support from Guidestone whose diversified suite of investment solutions align with Christian values to create positive change in the world. More information is available at guidestonefunds.com. Investing involves risk, including potential loss of principal. Carefully consider the investment objectives, risks, charges and expenses of Guidestone Funds before investing.
They're distributed by Foresight Funds Distributors, LLC, which is not an advisory affiliate, a registered investment advisor, nor do they provide investment advice. Are you looking for a financial professional who aligns with your biblical values? Certified Kingdom Advisors are trusted financial, legal or accounting professionals who have completed a rigorous certification program to ensure they provide biblically wise financial advice as part of their practice. You can find a local CKA professional in your area by going to faithbuy.com and clicking Find a CKA. I'm so glad you've joined us today on Faith and Finance.
I'm Rob West, your host, and I'd love to tackle your financial questions. Here's the number 800-525-7000. That's 800-525-7000.
Fort Myers. Hey, Glenn. Thanks for calling, sir.
Go ahead. I'm 70 years old. I have no debt. I retired at age 64 and all my 401K money I rolled over into a Vanguard portfolio in their Admiral Funds. I wanted to wait till I was 70 to file for Social Security. So for those six years, from 64 to 70, my wife and I lived on a monthly distribution from our Vanguard portfolio plus my part-time job that I have.
I filed recently in July at age 70, and my wife and I, we can live in our Social Security now. And beginning in 2022, I guess my Vanguard portfolio was at about 600,000. Now at this time, I just checked it yesterday, it's 524,000 because of the market downturn. We're no longer taking the distribution, like I said, since July from our Vanguard portfolio. We're currently allocated, the mix is 60-40 bond stocks. And of the bonds and of the stocks, we're about 70% in domestic and 30% in international. So my question to you is, since we're not taking any money from the Vanguard portfolio anymore, should we stay with that allocation and just let it ride out the storm? Yeah, very good.
That's a great question. I certainly understand kind of where you're coming from here. Thanks for that helpful background information. Glenn, how much did you say that that portfolio is down over the last year? Well, it started at 2022 at about 600,000. And yesterday, it was down to 524,000. Yeah.
Okay. So you're down about 13%, which is better than the market. And the reason for that is because you've had such a high weighting to fixed income, which was challenged last year as well, given the rising interest rate environment.
And you don't foresee needing this money unless you needed it for long term care or something unexpected. Is that true? Yeah, our goal is to not touch it.
Okay. But it sounds like that allocation is about right. It just so happened that last year ended up being an incredibly challenging year, both for equities and for bonds.
And they were just under significant pressure. So where do you go from here? Well, I think the good news is, as you said, you don't need this money, your bills are covered, you're continuing to work.
That's great. I would absolutely let this recover the 13% that it lost. Could it go down from here even more?
Absolutely. You know, we're expecting a recession this year, how deep, how long, how severe is still remains to be seen. But I think you riding this out, and then on the other side of it, once it's recovered, and the stock market will recover before the economy, once we see that the feds done raising rates, and we're ready to kind of turn the corner, there's so much wealth on the sideline ready to kind of flood back in, that this market will have a significant leg up. And I think at that point, then it's time to do kind of some soul searching and say, how did we feel kind of during the 2022 year?
Did that cause us some sleepless nights, some anxiousness? Are we, you know, too aggressive? And maybe should we, you know, be in an 80-20 mix moving forward or 70-30 getting a little bit more conservative. But clearly, given that this portfolio, which is significant, is kind of surplus, you know, I think the ability to grow that over time so that it's there if you needed it for, you know, long term care, which is significant in cost could be well over $100,000 a year, depending on what type of care you need. And given the effects of inflation, which is eroding the purchasing power of this money, I think all of that says that having a 60-40, 70-30, 80-20 portfolio, depending on how conservative you want to be makes sense, so that you can, you know, continue to grow this money over time. So if it were me, I'd probably wait this out, let it recover, and then decide, as you take a hard look back, you know, were we a bit more aggressive than we felt comfortable with?
And if so, then I think that's the time to begin to make some changes in the portfolio. Does that make sense? Yeah, it does. Well, listen, I really appreciate it. Thanks for your help. And God bless you, brother. Thank you, Glenn. Appreciate your kind remarks and for listening today. Thanks for calling.
Let's see, to Washington we go. Dustin, how can I help you? Hey, God bless you guys.
I just started listening to your radio station today, and it's a blessing to be on here. Hey, so I got a question about mortgage rates, and I've been looking into buying a house, but the houses are so expensive. Do we see a decline in the next few years? I know we can't really predict that, obviously, that far, but I haven't used my FHA that I'm qualified for.
What would be your suggestions? Yeah, you know, the best guess is that we really won't see much decline in the way of the housing market this year. I think at the most, probably five to six percent. But, you know, it's really just more than anything a leveling off of the increases we've seen in years past. We're going to have, of course, the natural seasonal declines, which we're experiencing right now here in the winter.
But kind of year over year, we're not expecting a whole lot. I mean, it's not like a bubble situation where we expect the housing market to crater or have any significant decline. There is still a very real shortage in this country of homes, even though the inventories are building, just in terms of the number of people sinking single family homes with the millennials reaching age 30 and having kids and people in densely populated areas that are moving to the suburbs because now they can work remotely.
I mean, there's just a demand beyond the supply that exists. And so for that reason, you know, I'm not expecting a whole lot of decline in the housing market. Could we see interest rates taper off?
Perhaps. But it's probably beyond this year because, you know, keep in mind, the Fed is going to continue raising interest rates. Now, mortgage rates don't always move in lockstep with the Fed funds rate. And we see that. For instance, mortgage rates got above 7%.
Now they're back in the fives. So I would say all things being equal, even though the housing market is still very high, I don't think, you know, you waiting is going to make a whole lot of difference. And we're clearly in a buyer's market where we weren't, you know, six months ago.
So you have the ability to negotiate, not pay a premium, have, you know, ask for concessions, maybe even have a contingency, things that really were off the table during the frenzy of the seller's market, you know, six months ago. So I think the key for you right now is to make sure you're ready to make that purchase. And that readiness comes from the ability to do a down payment of at least 20% and making sure that your principal interest, taxes and insurance payment is no more than 25% of your take home pay. Now, obviously, if you can go above that, but it's just going to make more and make it more difficult to balance that budget. So those rules of thumb, I think will ensure Dustin that you don't kind of extend beyond your reach financially. And I would lock those numbers in and make that decision on what you're going to spend before you go shopping for the house. Because what happens is, we start seeing homes that we want, and maybe in a location we want or with features we want. And we start to convince ourselves that, well, I can spend a little bit more and next thing we know, we're buying a house that you know, is outside of our reach financially and it just causes strain on the whole budget because it's for most people their largest expense. So I think bottom line is this is not a bad time for you to start shopping.
Just make sure that you're ready to make that purchase and you don't overpay. We appreciate you calling today. God bless you, my friend. We're going to take a quick break and back with much more.
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I'm Rob West. The number to call is 800-525-7000. Now before we get to your calls, I want you to know that Faithfi is here to help guide you with practical biblical wisdom and tools. Every day we share resources to help you steward what God has entrusted to you. From now through December 31st, we're offering the new book entitled Leverage, Using Temporal Wealth for Eternal Gain with a Gift of Any Amount. Give that gift right now by going to faithfi.com.
That's faithfi.com. Let's head right back to the phones Las Cruces, New Mexico. Hi Alice. Thanks for your patience. Go right ahead. Thank you.
Hi Rob. Thank you for taking my call. I'm a 70 year old woman who's going to retire at the end of June. My question for you is I have a thrift savings plan and I put it in the C and the F fund.
I am concerned of do I let it ride out or do I move it all to the G fund? Yeah. You said you're retiring when, Alice?
The end of June, this year. Okay. All right.
Very good. And when you retire, are you going to start pulling an income from this TSP account? I know that the TSP has to be moved out of the company that I'm working and apparently I have to find someone to manage my money. Sure. And right now I don't want to pull nothing out.
Okay. But are you, once you retire, are you going to be able to pay your bills with other income sources or will it require you to pull some money out each month? Because of my age, I think if they manage my money, they're saying I have to pull money out. Well, not really.
I mean the required minimum distribution isn't going to kick in yet. What is your age? Seventy years old. Okay. No, you've got a few years before you're required to take something out. I guess I'm wondering when you calculate your budget in retirement and your income goes away because now you're retired, are you going to be able to pay your bills with social security or are you going to need to pull something out of this in order to cover your expenses? I don't have to pull it out, sir.
I live on my income. Yeah, perfect. And what do you have in the bow in the TSP today, Alice? Roughly 300,000. Okay.
And what was it at its high point? Um, close to 400. Okay.
All right. So it's down a good bit. Uh, and you know, the market is down a good bit.
So you're down a, you know, 25% which is, you know, not insignificant. The reason is you're all in stocks right now. So the S fund is the small company stock fund there in the thrift savings plan. Uh, the C fund is the large cap, uh, you know, basically the S and P 500.
Um, so the 500 largest companies in the U S and so, you know, you're very highly concentrated in growth, uh, and large company equities. Plus you've got that allocation to the, the small cap. I think the key here is that, you know, you've got time on your side because if you're in good health and the Lord Terry's, this money is going to need you to last you a long time. And, uh, the good news is you don't need to take anything out of it.
So yes, I would agree. You probably need to have some money management. You need somebody who can, when it's rolled out to an IRA, somebody who can take responsibility for managing it. But I don't think this is the time personally, unless you just really want to, you know, get conservative and it's, it's causing you, you know, you're anxious over it or you're losing sleep over it. I'd rather you, uh, take the time to let this recoup itself, you know, as the market recovers and that it may go lower before it goes higher.
We have to recognize that, but I'd rather see you let this rebound, not lock in those losses. And then once it recovers and that may be a year from now, um, then at that point, uh, we're looking to get more conservative toward what you would typically have as a 70 year old retiree where you might have, you know, 30 to 40% in stocks and, you know, uh, 60 to 70% in fixed income type investments of which you really don't have any right now. And that would bring the volatility way down, uh, and increase the income that's being generated by the portfolio so that, uh, you know, it's more stable and, but it's still growing to try to outpace inflation.
So if you need it down the road for longterm care or any other need beyond what you currently have coming in from social security, that you would have the ability to tap this account. Does that make sense? Yes, it does. Thank you so much. You're welcome. And I think now is a good time for you to start looking for that advisor.
So when you're ready to retire, you know who you're going to move it to. Um, I'd head to our website unless you know, you've already selected that person and, uh, you'd go to faith fi.com that's faith fi.com and just click find a CKA Alicide, probably interview two or three before you make your decision. God bless you and thanks for calling today. All the best to you in this exciting next chapter of your life. Uh, let's head to Marion, Indiana. Connie, how can I help you? Hi Rob. Thanks so much. I listen to you every day, so thank you so much for doing what you do.
Um, my, thank you. You're my husband and I, we did some remodeling, um, and we used our home equity equity line of credit. However, I'm sure you know, the percentage rates are going up, uh, gradually. Um, and we don't have a whole lot on there, but I want to maximize the payment that we're making every month. Is it better for me to just continue to make the large payment every month? Because what I'm thinking is, is shouldn't I be making an additional payment, which would not be a problem to counteract the interest to help bring it down a little more?
Am I thinking right or am I totally off? No, I'd love for you to get that paid off as quickly as you can Connie, especially with this rising interest rate environment. Uh, given the variable rate on that home equity line of credit, uh, I think you having the ability to keep lifestyle at a minimum, try to free up as much margin as you can.
Assuming you don't have any high interests like credit card debt and assuming you have an emergency fund, then I would say at this point, let's take a extra surplus and let's add it to that monthly payment to try to get this knocked out as quickly as you can. Okay. That was my thought. And I'm, I'm glad you're clarifying that for me and affirming it. Um, is it okay? I mean, does it, is it beneficial to make two payments or should I just lump it into one? Does it make a difference?
It really doesn't. I mean, I would, you know, check with your mortgage servicer just to see how they want it. Do you make that electronically? Yes. Okay.
Yeah. And so, um, you know, you just want to make sure that it's being applied to the principal as they receive it. I mean, this is so common that I can't imagine there's going to be a problem there, but it's never a bad idea just to check with them and say, listen, the way you're receiving this, is it being applied the overage above the scheduled monthly payment?
Is it being applied to the, to the principal balance right away? But there's, there's no reason that you shouldn't be able to send that as one check. Okay. That sounds great. I'll give him a call. Thank you so much. I appreciate it. You're very welcome, Connie. Thanks for calling and for listening to the program.
God bless you. Thank you for stopping by today. Thank you for listening and being a part of the program. I want to say thank you to my team, Amy, Dan and Jim Henry. Thank you for being here. Make plans to join us again next time. I'll be here and I hope you will be too for another edition of Faith and Finance. Faith and Finance is provided by Faithfi and listeners like you.
