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That's 800-525-7000. This is Faith and Finance, biblical wisdom for your financial decisions. Okay, first I have to say that you never want to be financially independent from God. He owns everything and he's your provider, but you do want to be financially free to serve God more fully. Now, those who've achieved that know there's one absolute requirement for financial freedom and that's learning how to live not just within your means, but actually below your means and to do it for a long time. Certainly that will require doing certain things, which we'll get into in a bit, but achieving financial freedom actually begins with a mental exercise.
You need to change your thinking. Why do most diets fail? It's because they're based on deprivation.
As you restrict your calories, you feel deprived and you can only tolerate that for so long before you plow into a box of donuts. Living on a budget works the same way. If you feel financially deprived, you'll eventually start to overspend again.
It's the opposite of contentment. Why might someone feel financially deprived? Well, the Bible gives us several reasons, greed, envy, or covetousness, a lack of faith in God to provide, or any combination of those. But no matter the reason, it makes living on a budget difficult when it should be easy. The solution begins with developing a sense of gratitude for what God has already provided.
First Thessalonians 5, 16 through 18 says, rejoice always, pray without ceasing, give thanks in all circumstances, for this is the will of God in Christ Jesus for you. Next, you must believe that you can learn to live below your means. It might be a challenge and you'll probably have setbacks, but keep at it, cutting expenses as necessary. Okay, so much for the thinking part.
Now it's time to get your hands involved. Here are some tips for staying on budget. First, you must have margin. That's money left over at the end of the month. You no doubt have several fixed bills that come in every month and you pay them without thinking.
But start thinking about them. Is there a way to lower your mortgage payment? Maybe by getting rid of PMI? Can you reduce your heating or cooling bill?
Maybe get rid of streaming apps you don't use much. Don't take those bills for granted. Sometimes all you have to do is ask. Did you know you can actually negotiate things like medical bills and household repairs?
You might say, is that the best you can do? You might get a discount. It certainly doesn't cost you anything to ask. By the way, it's easier to stay on budget if you actually watch what you spend instead of having a lot of stuff happen on autopilot. Download the FaithFi app to set up your budget.
It will then track all of your spending and likely reveal things you can easily cut like those streaming apps I mentioned. That alone could save you a few hundred dollars a year. Now there's another tried and true way you can avoid feeling deprived by your budget and that's by rewarding yourself. You want to celebrate small victories along the way to financial freedom. At the end of a successful week of staying on budget, treat the family to ice cream.
After you have a thousand dollars in your emergency fund, maybe go out to dinner. The idea is that it's okay to splurge now and then, just not all the time. The same way, try to spread out your spending for things like having your nails done.
Instead of every four weeks, can you go every six weeks? At $25 a pop, you'll save around $100 a year. If you're paying to keep stuff in one of those used storage places, get rid of it. You can cut that cost and bring in more money by selling it.
For most things, if you haven't used it in a year, you probably don't need it. Every little bit helps. Okay, if you do all of those things, you've trimmed your budget as much as possible and you're still having trouble living below your means, well you'll need to increase those means. So look for ways to add to your income. Consider taking on a side job. After all, we're still in a gig economy. You could also consider picking up extra hours at your current job or even ask for a raise. You might be surprised at the outcome.
So that's how you can learn to live below your means and start the process of becoming financially free to serve God more fully. We hope you'll let us know how it works out because we'd love to hear your stories. All right, we're going to take your calls next. The number to call is 800-525-7000. By the way, you can call that 24-7800-525-7000. I'm Rob West and this is Faith and Finance.
We'll be right back. already receiving our weekly wisdom email filled with articles, videos, podcasts, and exclusive offers on resources that will deepen your understanding of biblical stewardship. Start your journey today by creating your Faithfi account at faithfi.com. Just click sign up. Healthcare is complicated.
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Choose your own provider and select the program that fits your needs and budget. CHM is the original faith-based way of taking care of your medical bill costs. Learn more at chministries.org faithfi. Thanks for joining us today on Faith and Finance. I'm Rob West. We've got a few lines open. We're taking your calls and questions. Call right now 800-525-7000. Let's see, to Montana. Jennifer, how can we help you?
Hi. First, my kids and I are safe, so that's not a worry in this question, but we have left a domestic violence situation and are in the process of litigation and all of that, so right now I have very, very limited resources. My soon-to-be ex has cleared out the bank account multiple times, leaving us with no income. When this all gets settled, I'll have about $1,000 coming in per month, but my question is, when our house does sell at some point, we'll be getting a chunk of money from that. Probably about $200,000 is my guess, and I don't have a lot of debt, but we're going to be living very, very minimal. We have a situation rent-free at least for this next year. My question is, should I take the money from the home sale and pay off all my debt so I can start fresh, or should I keep my continued debt and make my monthly payments to build my credit back up and sit on that money for a year or two until we've had a little more time to establish our monthly routine financially before we look at the new home?
Yeah, that's a good question. Jennifer, my heart breaks for what you just described. I'm so sorry to hear about what you've been through. I'm glad you're safe, and thanks for starting with that. And the good news is, God is on the throne.
He loves you, and he is your provider, no one else, and he can be trusted. And what I would say is, with regard to your financial life, we don't want to make any big purchases right now. We certainly don't want to buy a house, in my view. I think it's great for you to get the proceeds of that home sale. I think it would be great to get out from under the debt, assuming it leaves you enough where you have plenty of cushion, because we don't want to pay those high interest rates. I wouldn't hang on to the debt for the purposes of building your credit solely.
There are other ways to do that, but I would go slow. I want to get you some help, somebody who can come alongside you, and we would be happy just as part of our ministry to you, Jennifer, to pay for all of that, for a certified Christian financial counselor to come alongside you and work with you remotely, to help you re-establish your budget, make some key decisions, be a sounding board, a source of encouragement and prayer support as well. And again, there won't be any charge to you. But before we even talk about that as a next step, talk to me about kind of the income options you're going to have. And I know you said you're going to have a thousand a month plus 200,000.
Do you plan to go back to work? Is there a chance you can get that income up? The thousand is what I'm currently bringing in with work. Once child support and all the other things come in, it'll be a lot more and the kids will get Social Security as well.
So it'll probably be closer to 3,000 is my guess, but a lot just depends on how court plays out in the next coming months. But yeah, I have a really great job that I love that pays really horrible, but is very flexible with the kids' schedule. So I might have to look at a different job just to bring more income in, but we'll figure that out.
What about until now and when that's all settled out and you know what you're dealing with? How are you keeping gas in the car and food on the table and all of that? To be honest, God, he has blessed me with fellowship and community. My church, the kids' school, family have been just really stepping up and caring for us because we literally had $600 for the month of November and December collectively.
So we haven't had to buy groceries or fuel or anything. And we've been very blessed by community. Yeah, that's amazing. Well, that's the way it should be.
And that's incredible. I would, you know, start praying about what the Lord has next for you. I would love for you to be in a job you love. I also want to make sure we're solving for the income that you need, even though you're willing to, sounds like, live very modestly. We're going to need more than, you know, $12,000 a year. I know you know that. Obviously, in part, Lord willing, that will be solved through the outcome of the court process and child support. And as you said, even Social Security as well. So let's wait and see all that play out. I think in the meantime, you know, we got to get the house sold. And then I think at this point, we wouldn't be looking, in my view, at buying another place. Talk to me about the debt that you have. Is that credit card debt or what do you have? Credit card debt is pretty much the only thing. We have a couple loans on the home for, we had a home equity line that we did to do some repair work.
And then we put a new roof on it. So we've got probably about $60,000 in loans for the home. So my thought was when the house sells, we pay those loans off immediately because they'd be lumped in with the house. And then the credit card debt is pretty minimal. I think we're under three grand. Okay.
Yeah. So I would obviously settle up on any of the loans associated with the house upon the sale. And then you'll have the proceeds free and clear. I'd knock out those credit cards and then just put that in high yield savings, hang on to it, let it generate some interest while you're waiting for everything else to settle out.
So those would be the next moves. Not making any major life decisions at that point. Certainly not sinking the money into something until we get your income stabilized. We get you into your new job, if that's the way the Lord leads and you kind of know what you have to work with. And then I think you can make some decisions about longer term housing. What a blessing that you have something temporary, especially something that doesn't cost anything, which is going to go a long way to helping you get on your feet here. So let's do this.
If you're willing to do it, I'd be happy to connect you with one of our certified Christian financial counselors who will walk with you. We'll cover several sessions just to help you get your budget in place, make some key decisions, and then maybe even circle back once you know a little bit more about your income to help get a rhythm established and a system to control the flow of money. Does that sound good? That sounds amazing. Thank you. Awesome. Yeah, happy to do it. You stay on the line, Jennifer. Listen, we'll ask our faith and finance community to be praying for you. I'll certainly join you in doing that and stay on the line. We'll get your information and get that CERT CFC connected to you. May the Lord bless you.
Pittsburgh, PA. Hi, Sue. Go ahead. Thanks so much. My question is just some clarity around being Medicare eligible versus Medicare enrolled. My plan is I turn 65 in March. I am Medicare eligible and need to make a decision here, but my plan is to continue to work, Lord willing, continue with employment sponsored insurance, which is also an HSA that they contribute to and I do as well. So I've heard some conflicting information and I just wanted to see where I stand if I even have a thing to be able to continue to not enroll at this time.
Yeah, the nice thing is and the key here is whether or not you're still employed and covered by an employer-sponsored insurance plan. If that's true, then you do not have to enroll in Medicare at age 65. Now, when you are no longer covered by that insurance, you have eight months starting the month after your coverage ends to enroll in Medicare without a penalty. If you fail to enroll in Medicare Part B during that eight-month period, you have a permanent penalty. It's 10% of your Part B premiums for each 12-month period you were eligible but didn't enroll and then there's a smaller penalty for Part D. But if you have employer-sponsored insurance, you absolutely can wait.
Any HSA piece of it? Yeah, that does also qualify as long as you've got an employer-sponsored plan even though it's a high-deductible health plan. Okay, okay.
And they can continue to contribute as long as I'm not enrolled in Medicare? Okay, yeah. Correct.
Yeah, they absolutely can continue to contribute to that, for sure. Okay, thanks so much. Appreciate it.
Alrighty, thanks for your call today. You know, folks, as we think about our role as stewards and managing God's money, it's about faithfulness to opportunity. Now, some of you are listening right now and saying, I'm just trying to get to the end of the month.
I get that. And there's an opportunity to be faithful in that, and that is, what have I done with what God has given me? And perhaps you're in a season that's difficult and somebody needs to come alongside you and be the hands and feet of Jesus and help you get to that next place.
That's real. God will provide. He will sustain you. There are others that have been blessed with an abundance in this season of life.
They're trying to be found faithful as well. But I think as we see God's heart in all of this and really pursue Him, spend time in His Word, spend time in prayer, He will give us His insights into how we're to handle what He's entrusted to us. That's really the goal, and we want to encourage you in that on this program.
A quick break and back with more after this. offer biblical financial advice. To find a certified kingdom advisor in your area, visit faithfi.com and click Find a CKA. Hey, great to have you with us today on Faith and Finance. I'm Rob West. We're taking your calls and questions here. Let's head right back to the phones. Wheaton, Illinois. Victor, go ahead.
Hi. Yes, I'm 55 years old. I have $300,000 in a traditional IRA with one trust well financial, and they are transferring all of their business to LPL Financial. So I checked NerdWallet, and they recommend Charles Schwab. I visited with Charles Schwab. They will do a rollover of my traditional IRA, but they said they don't use mutual funds because of the fees. They invest directly into stocks. They buy and sell stocks, and they want to put me on a 65% stocks, 35% bonds. They said I was too conservative with one trust.
They had me on 80% bonds and 20% mutual funds. Yeah. All right.
Let me make sure I understand. So you're with an advisor now, and that advisor is moving to LPL as their custodian? Yes. Okay. And were you happy with the advisor and what was happening regardless of let's keep the the move to LPL separate for a second? Well, I was happy until Charles Schwab said they had me too conservatively invested with only 20% in mutual funds. Yeah, yeah.
Okay. Well, I mean, the thing is, you need to find an advisor who's not going to tell you what they think, but do the discovery they need to about who you are and what you're trying to accomplish and how much income you need. And, you know, you know, there's no need to take any more risk than is necessary. At the same time, depending upon how far or close you are to ultimately achieving your finish line in terms of what you're ultimately trying to accumulate in these retirement accounts will determine I think, in part along with your risk tolerance and a few other factors, what the right mix of investments is. And, you know, a good advisor, investment advisor should be able to build that mix of investments for you, you know, using, they'll take different approaches. So like you said, some might use mutual funds, other might use individual stocks, some might use ETFs with like an indexed approach. Others may say, No, I only use faith based investments, or we make that available. There's a lot of different ways to go about this.
And there's not one that's right or wrong. I think it's about number one, do you have a good rapport with that advisor? Number two, is the advisor really taking the time to get to know you and doing a deep discovery, including of your values as a Christ follower to help you plan and, and handle this money wisely in a way that's God honoring. And then thirdly, you know, as a part of that discovery, determine what is the right mix of investments, starting with that kind of bigger allocation framework, as you said, around how what percent of bonds versus stocks, but there could even be other asset classes that get brought into this to manage risk.
And then finally, you know, how are they going to do that? And again, there's several different options there, there's not a right or wrong approach, which does in some respects, put it back in your hands to say, Okay, you know, at the end of the day, I'm going to have to get a good feel for an advisor and feel like I have a good rapport and feel like I'm in the right mix of, of his or her clients, and they have a good track record. And I'm going to get the communication level that I want.
And we're going to go and you know, we're going to make every expectation that it'll work out well. But if it doesn't, then you move to another advisor, but hopefully it does and you find somebody to stay with. Now, the advisor moving to LPL doesn't concern me a lot. That's a fabulous broker dealer, one of the largest in the country in terms of serving independent advisors. And if you feel like not because somebody told you this, but because you feel like you're being too conservative, given your goals and time horizon and risk tolerance, I would start by just having that conversation with your existing advisor.
Now, if you've decided this is not the right advisor for you, or they've not listened well to what you're asking for, or for some reason, you've just decided you don't want to be with LPL, well, then at that point, it's time to look for another advisor. And I wouldn't start with the broker dealer, or custodian, I'd start with the advisor. And you know, really where he or she, custody's the assets, I feel like is secondary.
And that's why we recommend starting with the certified kingdom advisor designation, interviewing two or three advisors in your area, and then making a decision from that respect. But I know I've thrown a lot at you there. Victor, give me your thoughts or any follow up questions you have.
No, that all makes perfect sense. And I'm going to take your advice. I really appreciate it. Thank you so much.
Absolutely. Yeah, no problem. And I appreciate you checking in with us. If other questions come up along the way, don't hesitate to reach out. Lord bless you. All right, let's finish out the broadcast today in Chicago.
Peggy, thanks for your patience. Go ahead. Hi, just a fast question. I have one loan, which is a bank, it's a 7.25.
And it's about 20,000. Then I have a loan that I took care of my 401 is 14,000. I would love to retire in May, I'll be 65. Checking to see what would be the best way to consider paying everything off. I have no other debt other than those two. And it was a homeowner loan and I have no mortgage.
Okay, great. Yeah, I mean, so the the 401k, you're gonna want to be able to roll that out to an IRA, when you retire and separate from employment, and anything that you haven't paid back is going to be taxable to you at that point. And we'd rather keep that in the 401k.
So you've got it to convert to an income stream, you know, when that time comes, probably to supplement social security. So even though it's at a smaller amount, and you're paying the interest to yourself, I'd still love for you to get that paid back, I'd probably make that the priority. And then, you know, just deal with the minimum payments on that 20,000. And then once you pay that 401k back, pivot over to getting that home equity loan paid off. And then you're completely debt free at that point, which is great. So that would be the the priority order that I would use. Does that make sense?
Yes, it does make sense. And a key question to, you know, how do you figure out what's the best amount that you need for retirement? Yeah, it really, I mean, there's some rules of thumb, you can, you know, some people will say, well, you need 12 times your income, or there's various numbers or ways to tackle it. But when you're this close to retirement, it's really a function of what is the income I'm solving for. So I would start working on that retirement budget. For most people, it's 80%, 70 to 80% of their pre retirement income. And Social Security for most people is going to cover 35 to 40%. So the question is just how are we going to solve for that gap between Social Security and what we need on a monthly basis. And usually, if you can save enough to pull 4% a year and cover that then you're in great shape because you should be able to maintain that balance for the rest of your life.
So I think it really all comes down to the numbers and the income you're solving for hope that helps though. Thanks for your call today. We covered a lot of ground today. You know, as I think about our role in managing God's money, there are an unlimited number of decisions we make every day around our finances, and yet we can boil them down, we can simplify them into really just four big categories, the money we live on the money we give, the money we owe, and the money that we grow. But the big idea over it all is that God owns it all. And our goal is to be faithful stewards looking to God's word for counsel and wisdom to apply to our financial decision making. And when we do that, I believe it draws us closer to the heart of God.
It ultimately draws us into a more intimate relationship with Him when we handle His money according to His ways. I hope you found something today helpful and encouraging. I want to say a big thanks to my team today on behalf of Taylor and Pat and Devin. I hope you'll come back and join us next time for another edition of Faith and Finance. May the Lord bless you. Faith and Finance is provided by Faith Buy and listeners like you.
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