Making Ends Meet with Brian Holtz

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Go to faithfi.com and click app to get started. Our guest Brian Holtz is the CEO of Compass Financial Ministry. Brian, it's great to have you back with us. It's my pleasure, Rob.

Brian, I was so excited to see this new resource from Compass come across my desk. I'd love for you to explain specifically about this project, Making Ends Meet. Yeah, so historically, Compass has focused most of our efforts on the groups in the middle and upper level of income. And one of the main reasons, I think, is because we're all a bit puzzled when we work with someone who truly doesn't have financial margin available.

Not just that they've prioritized poorly, but that they really don't have access to income to meet the basic expenses of their life. However, the Compass team felt God pushing us to address it, so we partnered with several organizations that specialize in helping struggling families. And we learned from them what unique issues we needed to address from a biblical perspective. Yeah, and there really are some unique needs here that this resource addresses, which is why I'm so thrilled for communities and churches that can really begin to use this. What did you uncover as a part of this work? What was really cool, Rob, was that in this process, we realized that many of these seemingly unique issues weren't actually unique to low-income communities. The issues and solutions might be most prominent in low-income communities, but their symptoms show up in middle and upper-class America as well.

Yeah, that's interesting. Give us an example. So the first is a simpler way to manage spending. As you know, the most difficult part of budgeting is getting started. My family's been budgeting for 15 years now, and it doesn't take us much time, but when we first started, it was a real chore every single month. So this simplified method can be really helpful for people just getting started.

Here's how it works. First, at the beginning of the month, you pay all of your essential bills, your giving, your rent, your mortgage, food, heating and cooling, those kinds of things. Second, you move your savings goal into your savings account, and then for the rest of the month, you can use the money left on non-essential items like entertainment, clothes or eating out. Now this method isn't very precise, and I would say traditional budgeting is still a better way to plan and manage your spending, but it's better to use an imperfect system than a perfect system that you don't use. Yeah, and I can see how that really prioritizes the needs versus those things that are wants.

What else did you uncover? Well, the second one is how having an emergency fund can actually save people a lot of money. We all know that we need an emergency fund, but in low-income communities, it's even more essential. Take, for example, an issue I had with my truck the other day, and it was going to cost $1,000 to fix. Now the best financial decision was to fix it, but what happens if I don't have the money available to do it?

Well, I do have a few options, but they're all bad. I can take out a personal loan and pay 15% to 25% interest. I can take out a payday loan, which is going to be more like 30% to 50% interest. Or I can scrap the truck entirely and take out an auto loan.

Interest rate will be better, but it's going to be a lot more than $1,000. All three of those options push me or keep me in a cycle of debt, but if I have that money set aside, I can make the best financial decision and avoid the unnecessary costs of the other options. And since I still have a way to get to work, I can refill that emergency savings pretty quickly. So those are really helpful. Find a spending plan that works for you. Make sure you have that emergency fund.

Now this third one is about your network. Share that with us. Yeah, so it's a little less tactical, but no less important, and that is to build a network of people you can count on and use them. Because money is such a taboo topic in our society, we're often embarrassed to talk about our struggles and ask for help. So what we want to do is find people we can trust and talk to them about money before an emergency hits. Share our struggles and listen to theirs. Then when we need a little bit of help, whether it's financial, emotional, or just an emergency babysitter, we have people we can rely on and they have us as well.

I love it. Brian, tell folks how they can learn more. We believe Making Ends Meet is the most impactful project Compass has ever taken on. It combines Compass's trademark reliance on Scripture with a more tactical step-by-step instruction on how to move from struggling to thriving. It's perfect for small groups at churches, shelters, local community centers, and it's available in both English and Spanish.

You can join the work by visiting compassfinancialministry.org and clicking on Making Ends Meet. Excellent. Brian, always appreciate your time, my friend. Thanks for joining us.

It's great to be here. That's Brian Holt, CEO of Compass Financial Ministry. The website again, compassfinancialministry.org. Just click on Making Ends Meet. Back with your questions after this.

Stick around. God has entrusted his finances to you, and we at Faithfi have designed our Faithfi app to help you live, give, owe, and grow with that perspective. Our Faithfi app is the leading biblically-based finance app. You can manage your money, get top biblical financial resources, and interact with a community of like-minded believers where you can ask questions, get answers, and share what you're learning.

Go to faithfi.com and click the word app to get started. Each account is insured up to $250,000. This institution is not federally insured. So glad to have you with us today on Faith and Finance. We've got room for you. If you have a financial question today, now's the time to call, 800-525-7000. You can call with your name or you can be anonymous, and we'd love to tackle whatever's going on in your financial life, give you some encouragement and hopefully some practical steps rooted in God's wisdom for you to make a clear decision or choice with whatever you're wrestling with today. That number again, 800-525-7000. All right, let's head to the phones.

Jamar is in Arkansas. You'll be our first caller. Go ahead. Yes, I wanted to, I guess, kind of ask that you give advice on, I had a situation that kind of came up where I got behind on my bills or whatever, and I do work. I get paid maybe about $700 a week, but some of my bills I kind of fell behind on.

I wanted to know, is there some type of way, information that you could buy on maybe getting with like a company that has a lower APR? Because like the interest is just tearing me up right now. And I mean, I reached out to a company, I think it's called National Debt Relief, and they said they could do it, but I just wanted to get like a second opinion before I just jumped into something.

Well, I'm delighted you called, Jamar. Listen, you can do this. The starting point is to break this cycle of borrowing, and I realize that's harder than ever with expenses up across the board, and you're dealing with $700 a week and trying to make it all work. But it's got to be in the context of a plan. So we've got to get you on a spending plan so you understand what's coming in every month, and then you give every dollar a job. You know, we got to start with the big four, keeping the utilities and the lights on, keeping gas in the car to get to work, food on the table and a roof over your head. But beyond that, everything else is negotiable as we right-size the spending so you can live within your means. As a part of that, we've got to get you moving toward paying this debt off once and for all, and you hit on something really important, and that is not only a payment that fits in your budget, but with lower interest rates so that you've got more going to principal reduction every month to get you on a path to get out of debt. But the key is, with that slow and steady approach and with that new spending plan, once it's paid off, we don't ever go back there again.

And we take that money and roll it back into the budget into building an emergency fund, maybe saving for the future. The place to go is ChristianCreditCounselors.org. These are believers. They've worked with thousands of our listeners.

They'll do exactly what you need to do and help you set up a budget. Again, Jamar, ChristianCreditCounselors.org. God bless you, my friend.

Minnesota is where we're headed next. Dale, go ahead. Hi, Rob. Really like your show. It's really a needed ministry for Christians. It's really helpful. Thank you. That's very kind of you.

I'm delighted to hear you say that. Yeah, my question was about we inherited land from our parents. Our dad died first and then our mom. But we inherited that. Do you tithe then on that property? We don't intend to ever sell it. We'll just pass it on to the next generation.

Ah, yes. You know, that's up to you. I mean, the challenge here is I love the principle of the tithe.

Let's back up. And clearly we see the tithe in the Old Testament, and I think there's some things we can take away from that. Just the beauty of the tithe and the different types of tithe and how we use that idea of a systematic gift on the increase, starting with the local church.

So I think that's fabulous. I would say, though, for those of us on this side of the cross knowing what Christ has done for us, I would say that should be a starting point, not an ending point. Randy Alcorn calls it the training wheels of giving, but I think it is a great place to begin. Now, when you look at an increase, obviously you have an increase by way of an asset that you've inherited, but it's illiquid. And so I think at that point you have to decide, you know, if we don't plan on selling it, therefore, yes, we've realized it because you have an increase on paper, but you may or may not have the resources available to go ahead and make that gift. Now, if you did and you said we want to honor the Lord on this increase even though we haven't realized it, meaning you've realized it on paper but you don't have the cash, the liquid assets, then you may say we're not going to tithe on this because we just don't have the ability to do so and we plan on keeping it in the family and then continuing to pass it down. But if you did have the resources, clearly it is an increase, and if you have the liquid assets to go ahead and acknowledge that before the Lord and make a gift into the kingdom, I think that's fabulous.

So it's a little bit of a challenging area because, you know, folks who are in your position may not always have the liquid cash equivalent to what would be a tithe on what is really a paper increase. Does that make sense? Well, it really does.

It really does. So it would be kind of up to each individual, you know, would the Lord want you to sell it just so you could tithe and then it would be out of the family. And so, yeah, it really makes sense. Similarly, then, if you had another asset, say, well, like I bought some land and land prices have really gone up. And so similarly with that, would you tithe on your increase if you could do it or, you know what I mean?

I do, yeah. And, you know, listen, I mean, the Lord owns it all, right? It's all His.

He doesn't need our money. I think it's what He wants for you and not from you. So, you know, if you really want to keep this in the family, I mean, ultimately this is between you and the Lord.

I can't tell you what to do. But, you know, I wouldn't sell this just to be able to give because you have to feel like the Lord expects it of you unless you just sense the Lord is leading you to sell it to give it away. But if that's not the case and you're just wanting to honor Him with the tithe, I think one, you know, opportunity would be, you know, just to continue giving as you can and as you're able. But I don't believe you need to feel obligated to pay a tithe on the value of an inherited property unless the Lord's leading you to do so or you decide to sell it. Now, you may have other assets that you say, you know, we want to pull from savings or we've got some appreciated stock that, you know, we're not necessarily interested in hanging on to.

And you know what? We did receive this inheritance and we want to give accordingly. Great.

But I wouldn't be looking just for me to sell it to, quote, pay the tithe if your intentions are to keep it in the family and pass it down. Well, thank you. That was very helpful. And we'll be able to do the latter example that you said. So that really gives me peace.

That's what I was sensing and you kind of confirmed it. So thank you again. You're welcome.

Lord bless you, Dale. I appreciate you being on the program today. Call any time.

And thanks for your kind remarks as well. Let's go to Texas Ordin. Thanks for calling. Go ahead.

Hello. I'm 24 and I was trying to look for a home. I think it would be smarter to buy a home rather than live in an apartment. Right now, I'm living at my parents' house. But I was just wondering, like, what would be some good steps to move toward a home rather than an apartment?

Yeah. You know, I think the key is for you to save toward that down payment. And I think, you know, as you look at what might be your starter home, whether that's a condo or a single family home, you know, start to look at what you could support with your budget.

And there's really two key numbers you want to focus on. The first is, you know, you want to make sure that whatever mortgage you have, that payment, including taxes and insurance, is no more than 25% at the most 30% of your take home pay. And you could use an online mortgage calculator to kind of back into, okay, what mortgage could I afford, where the payment, you know, is no more than 25 to 30% of my take home pay. And then that would tell you how much mortgage you can afford. And then secondly would be to say, okay, now, whatever that mortgage is, I can add 20% of that. And that's really what I can afford to buy. But I want to save that 20% as a down payment.

So let's say that number is 200,000. So you'd want to, you know, make sure you have 40,000 saved up as your down payment, and then get the $160,000 mortgage. Or maybe you can afford, you know, 40 and then have a $200,000 mortgage. But I think the key is 20% down and a mortgage payment of no more than 30%.

As a starting point, what you may find is you got to delay it and wait. We'll be right back. 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. Thanks for joining us today on faith and finance. Let's head right back to the phones to Arkansas. Gavin, go ahead. Yes, sir. I have a question. After the FBI released last year after AT&T and Verizon got hacked that it's best not to use a cell phone number as a form of two FA or two factor authentication. And that's how I end up losing $5,000 from using that method.

So I was gonna see if you could give us some lot. Yeah, and so I'm, I'm not completely familiar with what you're talking about. I know there was a warning against using the text messages for SMS for two factor authentication, because of security vulnerabilities. So, and that I think was in the wake of cyber attacks and so forth. And so, you know, a more secure method would be an authentication app, you know, which more and more of these companies are offering, because, you know, that would then ensure that you have a more of an encrypted solution that could, you know, keep you free from, you know, potential cyber threats is the likelihood high of that?

No, it's not. But, you know, I think that would be a way to safeguard yourself. So an authentication app would be like the the Google Authenticator, or an app called Authy, A U T H Y, they are certainly more secure than the SMS based two factor authentication. Because, you know, they generate the codes locally in the app, which it makes it not vulnerable to, you know, some of these, was something called SIM swapping, where they get the SIM card out, and they can essentially be able to intercept that. But, you know, apart from that, I would say, you know, that would be the probably the easiest way for you to go about this. Of course, you always want to keep your phone software up to date and only install apps from trusted sources. You want to have, you know, a strong lock screen protection, whether it's, you know, password or fingerprint to ensure the phone is encrypted.

But I think the if you're trying to kind of avoid what they were describing in that alert, it would be moving toward an authentication app versus the SMS two factor. Okay, I appreciate you. Absolutely, Gavin.

Faith and Finance. Well, thank you. I appreciate that. Thanks for listening and for your kind remarks, sir.

Let's go to Mississippi. Greg, how can I help you? Hey, thanks for taking my call here. But I'm in my 60s and recently got a job where I'm making more money than I ever need to. I mean, I can live on 30 or 40,000 a year, but just looking at my W2 for last year, a little over $200,000.

And there's really no end to this job, as all the other guys there go well into their 70s doing this job. And it's just based on what we know in our past. But my call is, you know, I know about Googled like 401k or IRA or something, where it says like at my age, maximum amount is $8,000 a year I could contribute. That's right. I'm not really well versed in any of that stuff. My question is, if I went and got an IRA, a Roth IRA, a 401k, and I don't know if there's any other financial instruments, how much total if I had all those that I could throw money into, as you can probably ascertain by what I've said, I just don't need this much money. And if I could throw it into like those accounts, that'd be great.

Yeah, very good. Are you considered self employed? Or are you W2? I got a W2 contract.

Okay. And do they give you access to a retirement plan at work? There is I mean, I saw in the W2 where they took out like 20,000 I'm not really sure be honest, what that goes into.

Okay. Yeah, I think that's perhaps your first, you know, question is to call the HR department and find out, you know, what you have access to and what you're currently funding, if anything, but your 401k at work as a W2 employee through salary deferral, you don't make direct contributions that has to come out of your check. That's going to give you the most potential to put money away. Because if you're between 60 and 63, you know, the you can put up to $34,750 for 2025 into the the plan. And, you know, it when you include the employer contribution, you know, it goes all the way up to $81,000. So there's, you know, you got quite a bit of room there that could be put in through what you put in plus the matching portion if they offer that if not, then it would just be the portion that you could put in which again would be for your age.

34,750. Then on top of that, you could put into a Roth IRA, as long as you have earned income and you do when you're over 50, you can put in up to 8000. And if you haven't filed your 2024 return yet, last year's return, then you could go ahead and make that a 2024 contribution, and then turn around and put another 8000 in for 25. And if you're married, you could do the same for your wife, whether or not you know, she is working as a spousal IRA. So that would allow you to put in quite a bit of money, but your biggest opportunity is going to be in that 401k if you have one. And so I would get on with your, your HR department and you know, talk to accounting or whoever it is, and perhaps just get that maxed out through salary deferral since you don't need this money and that would get it in a tax deferred environment.

Super. The other thing which is just a plain IRA, could I contribute to that also? Or would I be limited to the Roth? You'd have to do one, the combination of the two, you can put into both, but you can't between the two of them, you couldn't put more than 8000 for last year and 8000 for this year. So you could put four and one and four and another or seven and one or one and the other or eight and one and zero and the other, but you can't go over eight in any IRAs in total. And my wife who does not work, but I could open up a Roth IRA for her also. That is absolutely correct.

So as a non working spouse, you can also have an IRA with the same contribution limits. Okay. All right. Well, Super, thank you.

It gives me something to work with. All right. Good. Thanks, Greg. Appreciate your call today.

Let's go to Alabama. Hi, Patrick. Go ahead. Hello.

Yes, I have a quick question. At the beginning of the year, I always make a contribution from savings to my Roth IRA. And at the beginning of the year, I put in 4000 dollars at the beginning of the year and I have an opportunity to do something else. So I'm leaving my part time job.

I'm 62 and about to retire. And I just I was just curious, what do I need to do if I have more deposit in my Roth IRA that I have earned income? Yeah, well, so you'd want to withdraw that excess contribution to make sure that you don't have any kind of penalty. If you remove the 4000 plus any earnings on it before the tax filing deadline, then you could avoid penalties. Any earnings withdrawn will be taxable and may be subject to the 10 percent penalty if you're under fifty nine and a half. So that would be the typical approach. If you don't remove the excess, the IRS charges a six percent penalty each year. It remains in the account. And so you do want to go ahead and get it out of that.

If you already filed your taxes, you would need to file an amended return, the 10 40 X, if you withdraw the contribution after the filing. So that would be really the next steps on this. OK, now that's what I need to know.

Also, I didn't know there was a six percent penalty. So you answered my question. OK, thank you. Very good.

Absolutely. Patrick, thanks for your call, sir. Big thanks to my team today. Devin Patrick, Sandy Dickinson and Taylor Standridge. Plus, everybody here at faith. I couldn't do this without them. Have a great day and come back and join us tomorrow. We'll see you then. Bye bye. Faith and Finance is provided by Faith Buy and listeners like you.