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And it's available in all 50 states and around the world. Learn more at chministries.org faith buy. One of my favorite passages is in Luke 12, the parable of the rich fool. Do we still need to be concerned about the size of our barns today? I am Rob West.
Actually, yes. Not many of us have barns these days, so we'll just use barns as a metaphor. Jesus' message in that parable is every bit as important for us today. I'll talk about that first, 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. Okay, so let's look at the first part of the parable, Luke 12, 16-19. That's where Jesus says the land of a rich man produced plentifully. And he thought to himself, what shall I do? For I have nowhere to store my crops.
And he said, I will do this. I will tear down my barns and build larger ones. And there I will store all my grain and my goods. And I will say to my soul, soul, you have ample goods laid up for many years.
Relax, eat, drink and be merry. Now, a lot of people might read that and think, hey, that sounds like a solid practical solution. You've got too much stuff coming in. Your barns aren't big enough.
You need bigger barns. What's wrong with that? Well, the rich man finds out what's wrong in the next two verses. They read, But God said to him, Fool, this night your soul is required of you, and the things you have prepared, whose will they be? So is the one who lays up treasure for himself and is not rich toward God.
If that theme sounds familiar to you, there's a good reason. Charles Dickens no doubt borrowed it when he wrote A Christmas Carol. Of course, there, Ebenezer Scrooge takes on the role of the rich fool, obsessed with money and possessions. But unlike the rich fool, old Ebenezer gets a second chance.
And so do we. Our second chance starts with understanding what rich toward God means. It's an unusual phrase and God's word doesn't elaborate on it, but we can get an idea of its meaning by contrast. It's the opposite of building bigger barns or laying up earthly treasure for yourself. Being rich toward God is acknowledging that we're made for him, not our own pleasure or possessions, that our abundance is in God, not our bank accounts. Rich toward God means counting him as greater riches than anything on earth. And it means using earthly riches to show how much we value God.
How do we do that? By giving generously to his kingdom. Had the rich fool done that, he might have heard these words from Matthew 25. Come, you who are blessed by my father, inherit the kingdom prepared for you from the foundation of the world. For I was hungry and you gave me food. I was thirsty and you gave me drink. I was a stranger and you welcomed me. I was naked and you clothed me. I was sick and you visited me.
I was in prison and you came to me. As you did it to one of the least of these my brothers, you did it to me. But the rich fool did none of that. He thought only of himself and when he died, he left his earthly treasure behind. Now, Jesus is not saying that our works save us, but he is saying that not doing the good works we were designed for will hurt our relationship with God. Jesus is teaching that money and possessions are dangerous because they can lure us out of love for God and keep us from treasuring him. Because of that, some might think that money is bad, but it's not.
It's really a powerful tool that can be used for good or bad. While the proper use of money can store up treasures in heaven for you, the improper use of money can be hazardous to your spiritual health, as it was in the case of the rich fool. The problem wasn't that he became rich. The rich are no less godly than the poor. The problem was that the rich fool ceased to view God as his supreme treasure. If God had been his treasure, what would he have done differently? Well, instead of saying, soul, you have ample goods laid up for many years, relax, eat, drink, and be merry, he might have said something like this, God, this is all yours. You have made my fields prosper. Show me how to express with my riches that you are my treasure and that riches are not.
I already have enough. I don't need more luxury and leisure. Then he might have gone on to say, I do indeed want to make merry, but not with self-indulgent peers. I want to share your blessings and make merry with the people who have been helped by my generosity.
I want the fullest blessing of giving while giving all glory to you. Had he said that, the rich man wouldn't have been a fool at all. He would have been a very wise man who was rich toward God. He would have discovered that as Jesus is quoted in Acts 2035, it is more blessed to give than to receive. The rich fool learned that the hard way, but we don't have to.
We can learn from his mistake and strive to be rich toward God. I hope that's an encouragement to you. All right, your calls are next, 800-525-7000.
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Visit faithfi.com and click Give. Welcome back to Faith and Finance. I'm Rob West. All right, we've got time for more questions today. We're just getting rolling here.
Well, we've been rolling for a little while, but we still have a ways to go. So we'd love to hear from you with whatever you're thinking about financially today. The number to call with lines open right now is 800-525-7000. Again, 800-525-7000. We'd love to hear from you. Back to the phones, we go to Chicago.
Hey, Pedro, go ahead, sir. Hey, thank you for taking my call. Quick question. I actually recently, probably in 2005, purchased a two-unit home in my name for my mother-in-law and my father-in-law, just they needed to buy something else. Their credit wasn't where it needed to be, so I offered myself to assist them with the chances of selling the house and having them earn some cash. But after the 2006 economy crash, we decided to stay with it because it was lower than what it was actually worth.
So we still have it. My only concern is that it's still in my name and they're not benefiting any credit on that. They're making the payments.
It has two units. They're getting income because they rent both units. They're getting enough income to actually pay for the entire mortgage and use a little surplus for their water. So what I want to do, how can I transfer the property over to them, remove my name, so that way they can begin to benefit the credit and everything that comes with owning a home?
Yeah. And so your objective is for them to own that asset outright in their name only? Yes, that is correct because it just breaks my heart that I still have it in my name. And even though I did them the favor, the first initial plans to sell it didn't work out. So we had to hold on to the property. And so we've been holding it on to it to this day.
Everything has paid off. They haven't missed a mortgage payment, but they're not benefiting from any credit whatsoever. And I want them to start just earning that credit. Sure. That makes sense.
Yeah. So you would do what's called a quitclaim deed to transfer ownership of the home to your in-laws since it would be considered a gift. And since the amount would be above the $17,000 annual gift exclusion, you would have to file a gift tax form with the IRS. That's Form 709.
That's okay though. It would just be taken off of your lifetime gift exclusion, which right now is at $12.96 million. So this is not taxable.
You just have to let the IRS know you're doing it so they can note that. And then at that point, it would be their property. And you'd probably want to just connect with a real estate attorney who could draft that quitclaim deed for you and make sure it's done properly.
And then that would be filed with the county records office. Okay. And then basically the mortgage will be completely in their name with the bank and everything? No. So the mortgage is in whose name?
Your name? The mortgage is in my name. Correct. Yeah. Yeah.
That's going to be a little more challenging. So if the goal here is not just to get the asset in their name, but to build their credit, the lender is not going to take you off of the mortgage because you're the one that qualified for the mortgage and they're counting on your, even though your in-laws are making the payments in terms of because they don't have good credit or a lack of credit, that was why you had to get the mortgage in the first place. So the lender has no incentive to release you from responsibility for that mortgage, regardless of who's been paying it.
So the only way at that point to get it out of your name and into their name would be to refinance it, but they would have to qualify and your interest rate would be, or their interest rate really would, would go up at that point. So unfortunately it's not really going to benefit them from a credit standpoint. Okay. Yeah. Okay.
Got it. So there are other things you could do. You could add them as an authorized user on a credit card that you have and your good credit history would transfer to them. They could open a secured credit card where they deposit a couple of hundred dollars and then they get a credit limit up to the amount of the deposit and they could charge budgeted purchases, even just a few dollars a month. But that would report them as on-time payers. I mean, if the goal is to build credit, there are things you can do.
You can even ask Experian to start to count, well, they're not making a rent payment, but utility payments, things like that, if that's in their name. So things like that can be done, but the mortgage is not going to be able to be transferred. Okay.
So they would have to refinance their name. Okay. Yeah.
Yep. All right, Pedro, thank you for your calling, sir. God bless you. Let's see, we've got only two lines open, 800-525-7000. Feel free to give us a call to Florida. Jose, go ahead. Hi, Rob.
Thank you for taking my call. I'm an employee and I have a 401k to my employee. Currently I have $22,000 and my wife is in the same boat, but she's got $8,000. I was conservative and since I decided I allocated everything in bonds. So during the pandemic, I didn't take a loss.
I was wondering when or what would be the signal for me to switch to stocks. What is your age, Jose? 42 and my wife, she's 36. Oh wow. Okay.
Yeah. Unfortunately, whereas bonds might normally be a safe haven in an environment like you, you know, we were in with the pandemic and the economy, they weren't in the sense that because on the heels of the pandemic, we had this runaway inflation, which was caused by the easy money and low interest rates. Because the federal reserve raised interest rates so dramatically, it was really a very difficult time, unusually difficult for bonds. So you went through a pretty rough season there where bond prices, again, which typically are more stable, were losing value. And so this is actually, we're coming into a period where bonds are actually fairly attractive because the yields are up and as the interest rates start falling, the bond prices are going to go up, not down. But given your ages, 36 and 32, you really don't need to be in a bond portfolio. So it's probably, well, it's probably a good time to go ahead and get repositioned to take advantage of the recovery in both the bond and the stock market. I might keep a little bit higher allocation of bonds until interest rates get back down than you normally would at 36. But I would start moving into stocks because you want to participate in that recovery as well. So normally, you know, with somebody your age, you might have 70% in stocks and only 30% in bonds. And so if you're 100% in bonds, you may want to start moving into a stock allocation. But again, keep in mind, you don't really need to be terribly concerned once you get allocated into the right mix about the performance over a quarter or a year or even a couple of years because you all have 30 or 40 years before you're going to need this money, at least 30 years probably. And so you've got time on your side. I think the key is to get positioned and then not try to make changes and time the market based on any of these factors. Because when you do that, you can get into a situation like you've been in the last couple of years where, despite your best effort to insulate yourself from the economic fallout of the pandemic, you actually kind of hurt your ability to make money. And given the time horizon that you have, I wouldn't be concerned about that.
Does that make sense? Yeah, yeah. So do you think that would be a good idea to start moving 50-50 at this point? Yeah, I think that's not a bad idea.
And then maybe once the interest rates come back down, you move the remaining 20 or 30 percent into stock. So you're at 80-20 or 70-30, but maybe a year from now, if that makes sense. Yes, sir. All right.
Thank you very much. No question. All right. And you as well. This is Faith in Finance. I'm Rob West. And more of your calls just around the corner. We'll be right back.
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For licensing information, please visit nmlsconsumeraccess.org. Hope for Zambia, empowered by Family Legacy, is a ministry providing hope to vulnerable and orphaned children in Zambia by investing into their spiritual, intellectual, physical and emotional growth and well-being. Whether distributing five million meals each year to students or empowering them to graduate from high school and go on to pursue post-secondary education, we believe that when you educate a child, you change their world. Go to hopeforzambia.com slash faith to transform a life. Welcome back to Faith and Finance. I'm Rob West.
We've got all the lines full, so let's dive back in to Winthrop Harbor, Illinois. Hi, Katie. Go ahead.
Hi. My question is in regards to a trust. My husband and I have a trust, and we're opening accounts at a new bank, and I'm wondering if it is okay to open up our checking, our savings, the money market, CDs. Are those all okay to open up in the name of the trust, or would there be some reason why you don't want to do that? Yeah, so you can put these accounts in the name of the trust, and generally you would do that with accounts that you don't want to go through probate. Now, keep in mind, with financial accounts that allow you to name beneficiaries, you can avoid probate without putting the account into the trust's name just by naming those beneficiaries. So while you can transfer ownership of your retirement accounts into your trust, estate planning experts usually don't recommend it with IRAs, 401Ks, that type of thing. The transaction may be treated as if you've cashed out the account, which can trigger income taxes on these assets. So you'd certainly want to check with your CPA before you do anything, but I think with the non-retirement accounts, you can either retitle them in the name of the trust, or you can name those beneficiaries. In either case, you would bypass probate.
Ultimately, I'd talk to your estate planning attorney about that, but that certainly is an option, and I think you're right. This is a good time to be thinking about it. 800-525-7000 is the number to call. Let's head to Tampa. Hi, Lisa. Go right ahead. Hello. Can you hear me?
Are you there? Yes, ma'am. Let's do this. I'm going to put you on hold, and we'll have our team see if we can get you back on the line. In the meantime, we'll head to Indianapolis. Go ahead, James. Hi, Rob. I'm interested in buying a franchise.
I've already gone through the process to get one awarded, and I talked to a couple options for funding, and I wanted to get your advice on maybe either using the Robs or an unsecured business loan. I don't know. What do you think about that? Yeah. I mean, the first option is usually directly with the prospective franchisor. Have you talked to them about any options they have for financing? Yeah, that's a good question.
I haven't. I can certainly do that. Yeah. So each franchisor financing agreement will differ, but some will offer to take on as much as 75% of the debt burden from the new franchise owner. They may even involve deferred payments. I mean, they have a vested interest in you being successful as long as you meet their requirements from an asset standpoint, but I would certainly start there just to see if they have a financing program.
Beyond that, you'd probably want to look at a commercial bank loan or an SBA loan or an alternative lender or something like that as your next options. Okay. I didn't know if you were familiar with the Robs process where they rolled over your retirement into a new C-corp and then you basically take what would be somebody investing in a 401k and using that to fund it. Yeah. So are you talking about through a self-directed IRA?
No. They take your money from your... So it just counts as a rollover from a traditional either 401k or IRA, I think, and you start a C-corp that is eligible to get invested in by a 401k and so you take your money, roll it over into your business, and then take your business money from that investment to basically have the capital to run the business and even pay back or pay into the franchise. Interesting.
It's a fascinating concept. I can't tell you that I'm familiar with that, James, so I certainly wouldn't want to weigh in on it, but you certainly could check that out, but I would, as I mentioned, also check with your franchisor just to see what options they have as a part of your due diligence. But as to this other strategy, you may want to connect with a certified kingdom advisor, somebody who works with small business owners and understands perhaps these additional alternative strategies like the one you're describing.
Unfortunately, I wouldn't be able to weigh in on that one. What is the franchise, if you don't mind me asking, and if you don't want to name the specific one, just maybe what industry you're in. It's business coaching. Okay.
So like, business coaching. Yeah. Yeah, nice. Very good. Well, hey, all the best to you. Sounds exciting and let us know how it turns out. We appreciate you calling today.
To Tampa, Florida. Lisa, it sounds like you're back with us. Go ahead, ma'am. Finally. Yes.
Well, this is a story. I have a 401k that I received from a settlement of it, from a divorce, right? And that money has stayed in that original account, but I do not work for that company, only my ex-husband, so I'm not putting any contributions. It was up to 50 something thousand dollars and now it's going down to 47.
So I don't want to continue to the scene. Then I have a pension from New York, but it's about $894 monthly and I work. So my salary is like $41,000. I have a car note that it was 72 months.
Probably I, I have two and a half more years to go. I want to know where to roll over that 401k as a result of a divorce settlement. I have a 401k with my job, but I don't think I can roll over that great amount. I'm not sure.
And I want to know how to better use that pension money and how to finish paying this car quickly because I'm 61 years old and even if I envision to retire at 62 with the car payment, I don't think I can do it. Hmm. Yeah. All right. Well, with that 401k, is there a qualified domestic relations order that informs the plan administrator on how to give you your share of that 401k?
I already have total authority. It's that I have not moved it to wherever I want to because I don't trust, don't trust and don't know where to. Okay, very good. What is the portion that you received about how much?
Um, it was like $55,000, but it went down to in the last two years, um, 47. So that to me, that's a great, um, I mean, they say that it will come up again, but still I'm not making contribution. It's just sitting there and losing money. Sure. Well, keep in mind, it just happened to be this period where we're going through a very difficult stock market, just because of the high inflation and the stock, the interest rates rising dramatically. So I would contact our friends at soundmindinvesting.org.
Uh, you're probably below the minimums for an advisor to work with you, but at soundmindinvesting.org, they have a way that they can help you, uh, get that IRA opened at a new institution, like a discount brokerage, roll the 401k in, and then help you select some mutual funds. That would be a great option. Unfortunately, I'm out of time. And so we won't be able to tackle the car or the pension, but feel free to call back tomorrow.
I'd love to pick up the conversation. God bless you, Lisa. Hey, we're almost out of time, but I wanted to let you know that you don't ever have to miss a program. Just download our faith by app for your mobile device and take us with you anywhere. Thanks for joining us today. I look forward to talking with you again next time on faith and finance. Faith and finance is provided by faith buy and listeners like you.
