3 Biblical Principles for Debt With Sharon Epps

Kingdom Advisors equips Christian financial advisors to bring their faith into their practice with the industry-recognized Certified Kingdom Advisor designation. We bring those advisors together with other industry leaders to form a vibrant network. And through that network, we give them the resources, tools, and encouragement they need to serve clients like you, helping you align your values with your financial decisions and investments.

To learn more, visit KingdomAdvisors.com. Sharon Epps joins us today to talk about that. 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 decisions. Well, just in case you didn't know, Sharon Epps is president of Kingdom Advisors, the organization dedicated to training your financial advisors on the biblical principles of managing money. Sharon, always a delight to have you on the program.

Thank you, Rob. Well, we like to keep things simple whenever possible, as you know, Sharon, and you have a great way of doing that when it comes to using money. In fact, it comes down to just four things, right?

Well, I hope we can remember this. It's live, give, owe, and grow. And as you know, I like to talk about live, give, owe, and grow as a pie. The reason for that is a pie is a limited amount.

And when you make one slice bigger, the other slice has to get smaller. And that's what happens with our money. And so today, we'll be talking about owe. And of course, that means debt. Yeah, and there's often some confusion about biblical principles when it comes to debt. So let's start with what the Bible tells us, or maybe we should say doesn't tell us.

Well, I think we need to think about this in high level principles and ask this question. Does the Bible say it's wrong to borrow money? And the Bible does not say that borrowing is wrong. Debt isn't sinful or evil, but it is enslaving. It redefines a relationship between two people.

One is indebted to the other, and it can be cumbersome, and it even begins to dictate decisions of the one that's enslaved. Well, Sharon, as you well know, principles can help us make wise decisions. So what biblical principles guide us on debt?

Well, I'd like to focus on three today. The first one is that we are clearly called to repay what we borrow. Psalm 37 21 teaches the wicked borrow and do not repay, but the righteous give generously.

Second one is we want to free ourselves from debt as quickly as possible. In fact, Proverbs 22 7 carries this warning. The rich will over the poor and the borrower is the slave to the lender.

And so we don't want to be enslaved. And then finally, the third one we'll look at today is that we're to serve God and not money. Matthew 6 24 says no one can serve two masters. Either you will hate the one and love the other, or you will be devoted to the one and despise the other. You cannot serve both God and money. Yeah, that's really helpful. And those are, of course, great reasons to get or stay out of debt.

But Sharon, is there a better one? You know, my favorite one is we want to be free to serve God. And if I'm enslaved to debt, then I don't have the freedom to make decisions like that.

And just a real quick story. My friends, Matt and Lisa, they got married and there was a ton of college debt involved when they first got married. They were actually so dedicated to serving the Lord that they took second and third jobs to get out of debt. And now they are free to serve in their gifted.

I love that. Well, what would we tell someone then who's struggling with debt to do first? Well, first of all, we want them to pray. We know that when we tell God our heart's desire, and it's in line with his will, he helps us to do that. And so we want to commit to do what he asked us to do and ask him to provide. The second thing is we want to save money. Now, wait a minute. Aren't we talking about debt today?

We are. But we call the emergency fund debt insurance. If nothing else, save a thousand dollars. The biggest mistake I've seen is people decide to get out of debt, pay aggressively down and then have to borrow again because they don't have the savings. And then third thing, we want to pay off all of our credit card and consumer debt first.

Well, that's exactly right. And if you're struggling to pay off credit card debt, you don't have to go it alone. You can contact our friends at Christian Credit Counselors. They'll put you on a debt management program and get your interest rates lowered.

So you'll pay off your debt 80 percent faster. Go to Christian Credit Counselors dot org to learn more. That's Christian Credit Counselors dot org. Sharon, thanks for stopping by.

It's been great to be here. That was Sharon Epps, president of Kingdom Advisors, who may come back. Your calls and questions at 800-525-7000. That's 800-525-7000. I'm Rob West and we'll be right back.

Change in the world. More information is available at Guidestone Funds dot com slash faith. 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 Four Side Funds Distributors, LLC, which is not an advisory affiliate, a registered investment advisor, nor do they provide investment advice. If the heavy burden of debt is robbing you of freedom and peace of mind, Christian Credit Counselors can help. We're a nationwide nonprofit credit counseling organization that has helped over 300000 individuals in the last 27 years. Get out of credit card debt 80 percent faster while honoring that debt in full. To learn how Christian Credit Counselors can help you visit Christian Credit Counselors dot org. That's Christian Credit Counselors dot org or call 800-557-1985. Thanks for joining us today on faith and finance.

I'm Rob West. Hey, we've still got half the program remaining and we've got some lines open. So you have a financial question today. We'd love to hear from you. The number 800-525-7000. Again, that's 800-525-7000. You can call right now. Let's begin today in Wisconsin. Bonnie, thanks for your call. Go ahead. Hi.

Thanks for your program. My question is almost more of just if you could further explain what a fiduciary interest is for your listeners, because when you ask if they have a financial planner, a lot of them say yes. But if that is an insurance salesman, you know, they're pushing their own products. And how can you be a true fiduciary with the best interest if you're making money off of what you sell and you only have a limited number of products you're going to tell them about? Yeah, it's a great point.

Yeah. And so this is a term it's gotten more awareness as of late because there's been more talk about it. But it is an important distinction when you're choosing a financial advisor. So the word fiduciary or the term in the context of financial advice is simply someone who is legally and ethically obligated to act in the best interests of the client. So essentially, this standard requires that the advisor prioritize the needs of the client above their own, which ensures that all recommendations and actions are made with the client's financial well-being as the primary concern.

Now, you might say, Well, why wouldn't every advisor do that? And it's simply to your point, if you're selling a product, and perhaps you have a limited number of products, it's not that you're trying to in any way recommend something that would be unsuitable for the client. But just by virtue of the fact that you are limited in your menu of choices, the product you're suggesting or recommending may or may not be the very best product for that client, both in terms of what it will provide in the way of return, the fee structure, the total fees and commissions paid. And so by working with a fiduciary, you are ensuring that anybody that you're working with who's making recommendations for you or acting on your behalf in a financial capacity is unencumbered by just a limited menu of alternatives and can recommend what is truly in your or the client's best interest with their ultimate financial well-being as the primary concern. So I think asking somebody asking an advisor as a part of the interview process, whether they are a fiduciary would be a good thing, because you know, you're going to make sure that you get transparency and accountability about the fees and commissions and other charges, you're going to get a full disclosure of conflicts of interest. They have a duty of care, which is to provide sound financial advice based on a deep understanding of your needs, goals and objectives. And then again, they're going to by law have to act in your best interest. And what I would also say, Bonnie, is that I think the concept of fiduciary, and the responsibility that goes with it really closely aligns with biblical principles of honesty and integrity and service, you know, Proverbs 11, three, the integrity of the upright guides them, which I think reflects the heart of a fiduciary ethics, which is making decisions that honor the trust placed in the advisor.

And so as you seek out perhaps a certified kingdom advisor, which is the designation, we recommend when you go to faithfi.com and click find a professional, you could include asking that question, are you a fiduciary as a part of that process, you will find that the vast majority will answer in the affirmative. Bonnie, is that helpful? Yes, I was aware of that. I just wanted your listeners to be more aware.

And that was an excellent explanation. Thank you. You're very welcome. Thanks for your call today. Lord bless you, Bonnie. Let's go to Rock Island, Illinois. Hi, Kristen, how can I help you?

Hi, yes, thanks for taking my call. I have a 13 year old son, and he has been making money doing yard work and lawns and things like that. He currently has a little over 2000. And he keeps asking, Mom, where can I invest this money? And so I just wanted your recommendation to know where the best place to start out, you know, a young teen would be and if he's trying to save and invest.

Yeah, well, I love this that he's thinking about this. And there are some great options out there for him to look at one would be called stash would be a great platform. He could look at acorns or betterment. Another option would be, you know, if he wants to put it into one of the faith based investing mutual funds, he could just open an account at Schwab or fidelity, and then invest there. I mean, the nice thing with kids, though, I will say, is being able to invest in companies that they know, and are interested in and maybe, you know, like to buy things from and so, you know, although he would be more highly concentrated than we'd like for him to be once he's doing some serious investing a few years down the road, and you'd have to let him know that, you know, when he gets more money, he's going to need to quote, diversify, and you'll need to define that for him. I think just from an interest level, and a learning standpoint, there's something to be said about him opening an account at, let's say, stash, where they allow you to do fractional shares. So even with a small amount of money, he could buy, you know, even a percentage of one share of a company he knows, and then you could challenge him to kind of keep up with the company and watch it and do his research on it, that type of thing. So I would say if you want to just kind of drop it into a mutual fund and let it go, maybe choose a Fidelity or Schwab and buy one of the faith based investing funds.

If he wants to be more hands on, and would like to buy companies he knows I think that's where stash could work well, and he could use something called fractional shares to buy individual companies that he's particularly interested in. Does that make sense? Okay, yep, it sure does. Well, thank you. You're welcome.

You'll find stash at stash.com. So you could check that out. And it'll go through all the details.

It really is designed for beginners. And so I think it could be a great option. If he has a smartphone, he could, you know, track everything right there on his phone.

And, and he'd probably have a lot of fun doing it. Thanks for your call today. God bless you to Tennessee.

Hi, Barry, go ahead. I'm in the process of having to sell a half interest in a farm to sell in the state. And we're auctioning the farm off and I don't understand exactly how the capital gains tax works on there.

Okay, well, let me just say anytime we've got something out of the ordinary, always a good idea to get professional advice. So I'd encourage you to connect with a CPA to look at your specific situation. But what I would say just generally is, if you recently inherited the farm and sell it promptly, you should have little to no capital gains tax, because you receive what's called a stepped up basis when you inherit a property. So your selling price minus your stepped up basis should be close to zero. And therefore you would have little to no capital gains. If you don't sell it right away, and the property appreciates, well, then you would pay capital gains on the difference between the selling price and that stepped up basis, which is the market value as of the date of death. So let's say your stepped up basis was half a million dollars, and you sell it soon after for $510, your capital gain would be $10,000. So the IRS automatically treats the sale of this inherited property as a long term capital gain. And you could find the long term capital gains rates. But essentially, that step up in basis that we enjoy right now is what is so helpful for inherited properties, because it jumps that cost basis up from whatever it was initially to the true market value as of the date of death. Does that make sense? Yeah, say that this farm has been in the family for 40 years. What effect does that have? It has no effect as long as my mother passed away about a year ago, and this is when this all transpired.

Okay, so if the person who owns it now by way of inheritance would have gotten a step up in basis from your what your mom paid 40 years ago to what the market value is as of her date of death. Let's talk more off the air. We'll be right back. 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, faith wise 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 faithfind.com and clicking Give. Are you a financial advisor or CPA seeking to build your practice on biblical wisdom? Not only does the certified kingdom advisor education provide you with deep biblical insights, the CKA designation sets you apart. Each year almost 50,000 people search for a Christian financial advisor. Join our community and share your expertise with clients looking for someone who shares their faith and values.

Find more information at kingdomadvisors.com slash get certified. Great to have you with us today on faith and finance. You know, each day our goal in this program is to be an encouragement to you. We recognize you're a steward.

I'm a steward. God owns everything and therefore we have stewardship responsibilities, which just simply means no ownership rights. So we look to the Council of Scripture to guide how we handle God's money, our goal faithfulness to whatever God has entrusted to us. And it is amazing to hear those testimonies of life change people that have been freed up from the bondage of money that has gripped their hearts in part because of their giving and an understanding of a biblical worldview of money management. And they call us and tell us listen to what God allowed me to do as I now see money as a tool and let me tell you what I'm doing as I, you know, go on the mission field and let me share this with you about the generosity that's taken place or what I've been able to pass on to my kids.

It's amazing to hear those stories and when you support our work here at faith five you're giving to every one of those stories. Now we have an exciting opportunity between now and year end. We're trying to meet our year end goal of $300,000 between now and December 31st and half of it was put up by some generous donors. So they said every gift is going to be doubled up to 150,000 and that's going to be doubled to get us to that $300,000 goal between now and the end of the year. So if you've found some benefit in this ministry, maybe you've been encouraged by it, you want to ensure that others hear the life changing truth from God's word around money management. Well, we would just invite you to be a supporter of this work and the good news is every gift of every size is going to be doubled up to $150,000 between now and December 31st. So you can head to our website faithfi.com and click give that's faithfi.com and click give you'll see our impact report all that we've been able to accomplish this year and then right there on that page you can give knowing that every gift will be doubled.

So would you take time right now and head to faithfi.com and click give right there at the top of the page you can give monthly or one time gifts of any amount would go a long way to helping us reach our goal by the end of the year. Let's head back to the phones to Topeka, Kansas. Hi, Steve, go ahead. Hey Rob.

Hey, Steve here. I drive a charter bus and I just wondering what would happen if I got into an accident as so to speak. I know my bus company would the insurance would be provided for a situation like that. But can they come personally after me because all my home and everything's all paid off. I don't know anything on anything and I don't want to have an accident and then be in a lawsuit for you know that they can always find negligence in anything. They could say oh well you were two miles over the speed limit and therefore you were speeding. So my question is what type of insurance or how could I be covered for something like this?

Yeah, yeah I would definitely look into this. This is where an umbrella policy comes in although because you're talking about a situation where you're actually on the job you just need to make sure that it is in fact going to cover you. Because to your point they can absolutely go after the bus company first which they would because you're acting in an official capacity as an employee or an independent contractor working on behalf of the bus company. But assuming they find negligence and you're right anybody can claim anything and the court system and jury may go along with it. Now all of a sudden you could be sued personally and I'm not an attorney so you need to get legal counsel but this is where an umbrella policy comes in where it can cover you and make sure that your assets are protected. You'll also want to get with your insurance agent just to make sure that they understand that you're looking for this to cover you personally beyond what might be paid for from your employer and make sure that that doesn't disqualify you from being able to collect on this policy. If your personal assets are attached under a lawsuit because the last thing you'd want is to think that you're covered and that you know that okay if they get beyond my employer and they find negligence and they come after me you know that this umbrella policy will actually pay out. Now assuming you confirm all of that with the insurance agent and an attorney I would say it's a very cost effective way to protect yourself.

The average cost of a million dollar umbrella policy is $383 and you know you are talking about another $75 a year for every additional million dollars in coverage and you'll probably want quite a bit because if there was some sort of accident. Obviously it could exceed pretty quickly the limits of the policy that your employer has. So I would definitely take this next step. It's certainly something worth looking into.

Again it's very cost effective but you need to do your homework given the situation that you're in to make sure that the fine print isn't going to take away what you're expecting to get in the way of coverage. Does that make sense though? It does.

It does. And I have looked into it and I've really never had anybody can answer my question on that. I've even talked to my employer you know so it's kind of one of those things that I put on the back burner and forget about it and then all of a sudden like ah you know it may happen.

Yeah. Well a great place to start is with whoever handles your property and casually currently. So whoever has your homeowners policy and or your auto insurance coverage you know that's the way I've done and I've just added on to that bundled policy for me personally as an umbrella policy and I get your agent on the line and just say listen you know what my line of work is and I want to make sure that if I'm sued personally beyond the limits of my own coverage and my employer's coverage will this actually provide the coverage I'm looking for for my personal assets if I'm acting in a work related capacity and they'll be able to answer that question one way or the other and I would do that correspondence in writing. Quick question if you be so good as my wife and my wife and I own our home together. So I would be the one at fault that they take our home from us even though she wasn't involved. I mean generally your home is protected, you know from a lawsuit especially where this is a marital property. And so, you know, but again this would at the end of the day be a legal question that I would talk to an estate planning attorney about and that's where having sufficient liability coverage is really an important thing because you know these these expenses can run up so significantly and we certainly want to pray that we're never in a situation like that but we know that they do happen and it can quickly exceed the limits of a of a basic homeowners or auto insurance policy.

So, you know, could they take you and your wife's home out from under you probably not, but at the end of the day that's going to be a question you'd want to talk to an attorney about. Listen, it's, it's a good thing to be thinking about Steve so I'm glad you called and I would really encourage you to take the next step and explore this a bit further. Thanks for joining us on the program today we appreciate it, folks. What a privilege it is to be able to help you and navigate your financial lives in light of biblical wisdom our goal here is to be hopeful and encouraging but always to give you wise counsel rooted in biblical truth here on faith and finance big thanks to my team today certainly couldn't do this without him Devin Patrick that Montague also thankful for Jim Henry and the great work he does and everybody here at faith by have a wonderful day and we'll see you on Monday. Bye-bye faith and finance is provided by faith by and listeners like you