5 Divisions of Income

Hey, do you know where your animals are? Not just your dogs and cats, but the Bible says you should know well the condition of your flocks and herds. No sheep or cattle? Well then how about your checkbook?

What the Bible is getting at is to be a wise and responsible manager of your possessions. Here with some thoughts on how to do that practically is Kingdom Advisors President and our very own animal wrangler Rob West. And in just a few minutes we'll be taking your comments and questions at 800-525-7000.

800-525-7000. I'm Rich Rosalind for the vacationing Steve Moore and this is MoneyWise Live. Well Rob, I know all these different agricultural references are meant to show us how best to manage our money but I'm guessing they may have made a little more sense back in ancient Israel when the culture and the economy were primarily agrarian or farming related, right? Exactly Rich and if the Bible were being written today I'm sure the Lord would give us direction in a way that's relevant to our culture, maybe referring to bank accounts and credit cards, perhaps retirement plans or even the stock market.

But let's look at five areas of spending today that are just as critical to us now as they were 2000 years ago. Number one is that the first part of our income is to be given to God. Proverbs 3 reads, honor the Lord from your wealth and from the first of all your produce.

Now unless you're a farmer today your produce is probably your paycheck. But the principle of giving and tithing the first part of our increase still holds today and of course in the Old Testament there were actually several different tithes for the Jews totaling more than 10%. Okay well God comes first so what is our next area of spending? Yeah well the next the Bible says is Uncle Sam. I didn't say it, Jesus did. In Matthew 22 he says plainly, render unto Caesar the things that are Caesar's and to God the things that are God's.

And by the way I think we should do this with the right spirit or attitude. I don't pay more than I have to but I also try not to do so grudgingly. I'm happy God's given me enough to pay my taxes and I then pray that our elected leaders will use the money wisely. It might even help to think about paying your taxes as symptomatic of God's provision. You wouldn't have to pay any tax if you didn't have any provision so therefore you can do it with a thankful heart.

Yeah I think I've still got a bit of work to do on my attitude I'm afraid but anyway what what is our next division of income? Yeah next God tells us it's our family. Let's go to 1 Timothy 5 it reads if anyone does not provide for his own and especially for those in his household he is denied the faith and is worse than an unbeliever. So here's where the admonition to know well the condition of your flocks and herds comes in. Providing for your family obviously includes food, clothing, housing, perhaps a savings account if you have a bit extra and even preparations for your children's education if possible. Now there are a lot of fine points we could get into as to how to do that but husband and wife together of course if you're married as one flesh should have this as a priority with each using their spiritual gifts and talents and that's going to be different with each man and woman but they should decide together without the his money her money approach that often leads to even mistrust or even bad communication.

It sure does. So family is third then what is our fourth division of income? Yeah well it's pay your debts. There are many verses that encourage this but here's what Psalm 37 says it's pretty plain the wicked borrows and does not pay back but the righteous is gracious and gives. So paying your debts has to be a priority not if you can afford it. Being in debt can affect your career, your marriage, your credit score, even your emotional well-being or your witness for Christ. You know a lot of things can lead to debt and some of them may or may not be your fault so to speak but the best to the best of your ability don't live on credit. I think we need to learn to say no exercise self-discipline ask God what his plan is for our lives and save save save for big ticket items. We don't just go with the flow buying cars and other things with loans if we can possibly avoid it and always try to avoid getting swept up into the comparison trap. Right so I guess the bottom line there don't finance your flocks and herds if you can possibly avoid it. I think we've got time a brief time for one more major area of spending.

What's that? Yeah well this is another critical one and it's creating a surplus there are three reasons you have to do it first to meet the needs of others. 2 Corinthians 8 the Apostle Paul writes at the present time your plenty will supply what they need so that in turn their plenty will supply what you need. Second to provide flexibility for emergencies Proverbs 6 look to the ant she prepares her food in the summer gathers her provision in the harvest and third for a surplus to invest and multiply your assets. Matthew 25 the parable of the talents teaches it's good and faithful as a steward to manage your money well to get a return with interest. And there you have it five divisions of income and how you should use them.

Back with more after this. Money and life run on the same track but unfortunately sometimes it seems like your money is heading in a different direction from your goals. In never enough three keys to financial contentment author Ron Blue helps you to break down all your financial options to a basic four and then shows you how to keep it all chugging along in the right direction on the same track. Never enough three keys to financial contentment available when you click the store button at MoneyWiseLive.org. If you're investing for retirement or any other goal you may be wondering if it's possible to enjoy both profit and peace of mind no matter what's happening in the market. SoundMind Investing has a short video webinar on that topic at SoundMindInvesting.org. SMI has helped tens of thousands of Christians learn to be wise and faithful stewards in the area of investing.

Profit and peace of mind no matter what's happening in the market at SoundMindInvesting.org. Hi I'm Johnny Arcentada and as a kid on the shores of the Chesapeake Bay I would often trap crabs but when I had to pluck those ill-tempered critters out of the net they were nasty and they'd pinch me. It's an odd memory from my childhood but it came to mind recently when I read Psalm 25 where it says mine eyes are ever toward the Lord for he shall pluck my feet out of the net.

I had to smile. I could easily see myself as an ill-tempered crab. My sinful nasty nature often doesn't want God to touch me when I'm stuck in some sin. When I get myself into trouble my pride does not like being ensnared and so I'm likely to snap at the very one who's coming to my rescue.

God forgive me. So friend if you have gotten yourself into a trap do not let pride keep you from looking to God to pluck your feet out of that nasty net. 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 300,000 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 christiancreditcounselors.org. That's christiancreditcounselors.org or call 800-557-1985. You're listening to Money Wise Live on Moody Radio. I'm Rich Roswell sitting in for the vacationing Steve Moore. Today our host as always is Rob West and I neglected to give the phone number before we hit the break so let me do that now.

800-525-7000. Of course you can also connect with us by email questions at moneywise.org or on Facebook or any of our other social media platforms you'll find us at Money Wise Media and by the way our Facebook question of the day today is how do you determine where to spend your money so if you'd like to get in on the conversation that way that's another way to do it again Money Wise Media when you go on to Facebook. Rob we do by the way have an email question this was from John he says if I'm shopping for a mortgage with multiple lenders will my credit score be hurt if I allow multiple lenders to pull my credit record report as I'm shopping around. We get that question a lot.

Yeah we really do and it's a great one John. The short answer is no. There's a 14 day window there where if you're pulling or if credit reports are being pulled with your authorization for the same type of credit so you're shopping a mortgage for instance with multiple lenders in the same 14 day period or you're applying for a car loan with multiple lenders in the same 14 day period as long as it's for the same purpose those are going to be treated as one but the key is be ready to go when you start because you're going to want to get those lined up with whoever you want to shop with because that 14 days will go quick and by the way John this is a great idea we talked yesterday in the broadcast about a recent study by the government saying 47 percent of those that get a mortgage don't shop around. It's the largest transaction or purchase you will make.

You might as well get a second or third or fourth opinion. We love bankrate.com as a way to check that out but hopefully that's some good news for you. And again if you've got a question that you'd like to ask by email we get to those as we are able and again our email address is questions at moneywise.org. To our phone lines though again 800-525-7000 is the number and we've got several lines open. We'll start off in Allentown Pennsylvania. Joe you're first on MoneyWise Live today how can we help?

Hey thanks for taking my call you guys I really appreciate it. So honestly I hear a lot more about cryptocurrencies developing more and more over the past 10 years or so even to the point where like there's much larger companies getting involved mutual fund companies and things like that. So I'm about 36 now and I'm wondering what role cryptocurrency might play in my portfolio like an asset class or an investment currency and maybe how that might impact my retirement over the next 30 years of savings.

Like what should we be paying attention to in terms of making wise decisions about this asset? Yeah well it's a great question Joe and clearly these types of virtual or cryptocurrencies are here to stay. One of the challenges is which is also why they're being used in many cases is they're unregulated in traditional terms. So you buy a virtual coin and you use it as a means of exchange it has no intrinsic value.

There are a number of them out there you might be surprised to know that I'm aware of that there's more than 1800 of them out there. Bitcoin would be the best known but there's so many of them and I think in our digital instantaneous economy we're going to see more and more use. Certainly COVID I think the pandemic has helped us take a leap forward whether you like it or not toward a paperless transaction and economy just as out of health concerns we transact business more and more online or even in person doing that using a smartphone or some other form of digital currency.

So I think this is here to stay and we're going to see more and more of it. As an asset class in terms of including it in your portfolio I would put it in the ultra high risk category. It's just way too much volatility. It grossly exceeds any other investment class and so I just don't like it for that reason.

I would rather be with a more sure and steady approach. Bible talks about steady plotting and I wouldn't put bitcoin or any of the other cryptocurrencies as an investment in that category. There are some challenges as well. I mentioned they're unregulated. We've also had reports that terror groups are using bitcoin and other cryptocurrencies which fuels the volatility because people fear they could be outlawed or in some cases eliminated. They can be hacked. It actually happened in South Korea where users lost money and with no regulation there was no way to get it back.

So I would just watch it. I think again you're going to see more and more of it and you're probably going to be a part of it as we move more heavily toward this cashless society but as an investment I would leave it out of the portfolio. Rob I want to jump in with a question about this. Sorry for interrupting Joe but to me cryptocurrency would be like quote investing in another currency in another form of money as opposed to investing in a company. So how is it that investing in something like cryptocurrency would even be a potential benefit for somebody?

How does it work Rob? Yeah exactly. Well essentially what happens is you are buying you know in most cases you're buying the currency of another country and they rise and fall just based on the economic activity. So we might have a stronger dollar or a weaker dollar depending on what's going on and the same would be true in other parts of the world depending upon how their economy is performing which makes them in some cases more speculative or not. And so people will use them like any other underlying asset whether it's precious metals or publicly traded companies to buy in with the hope of appreciation and then the opportunity to move out. The problem is when we're buying some of these that we expect higher appreciation the volatility and the risk goes up with it. We see a lot of people for instance buying into currencies in the Middle East especially during the war that we saw in the earlier part of the last decade.

So you know I think we just have to be careful. I think we leave that in my view to the professional traders and we should be a more sure and steady less volatile approach of investing for the average person. So Joe for you as you have looked at cryptocurrencies have you found something that's particularly appealing to you that makes you want to get into this or is it just because it's a hot topic and has been for a decade? It's a little mix of both. It's the hot topic. It's kind of like you introduced earlier that it's starting to get more attention as it's working through you know going through regulation and becoming regulated. You know people are speculating about what type of economy and market it's going to end up producing if any.

So it's kind of in the scratch your head territory in my opinion right now because I'm still trying to wrap my head around it for the most part. But you did bring up scripture at one point. I kind of had a two-part question. I think you used the phrase cashless. So I think in Revelation 13 it talks about there being some kind of cashless society referenced and even this week I think there was a major publication that the front cover said life after cash you know and it had a half of a dollar in a museum casing. And I just wondered you know there were times when I was growing up that the barcode was seen as possibly being the mark of the beast or credit cards were going to be you know the cashless thing. Is that something we should concern ourselves with this or kind of like my take on it is exactly what you just said. It's like it's designed to be another type of currency so it's not really you know distant hearing in that sense and in terms of buying and selling. But just wondering your thoughts on that from a Revelation standpoint. Yeah I think I mean obviously we need to be shrewd and wise in our dealings as we handle God's money and we need to keep our eyes wide open.

We need to know what's going on. But I don't really see any concern necessarily with the move that we have underway right now toward more of a cashless society. I think it's a means of exchange whether it's a physical paper currency or not. Now there will be folks that will get into how much is traceable and who knows what you have and therefore can exert some sort of control over that and so forth. But you know at the end of the day I think we need to realize that what passes through our hands is what we're responsible to manage as stewards and whether that's done in a virtual sense or in a physical sense.

I think the key is to be applying God's principles as we manage his money. And you know I wouldn't be overly concerned about the trends that we're seeing unfolding right now much of which is being accelerated by the current pandemic that we find ourselves in. Could that change down the road? Could there be new elements of this that come into play that we need to be on our guard against? Sure. And I think that's why we always need to keep our eyes open. But it's a great question, Joe.

I think it's not going anywhere anytime soon but as for the portfolio I'd leave it behind. Joe, we appreciate your call today. Thanks so much.

You raised some quite great questions for us. 1-800-525-7000 is our number. Again, 800-525-7000. And Rob, as you just mentioned, being wise with your money means giving up ownership of it and remembering that God owns it all. And all we have to do, and I put quotes around that, is manage it.

It also means trusting that God will provide for our needs. This is MoneyWise Live. We'd love to have you on our program.

Again, 800-525-7000. We'll have more right after this. Do you know if you have enough? Enough money? Enough house?

Do you know how much is enough? If not, Ron Blue can help with his book, Master Your Money, a step-by-step plan for experiencing financial contentment. Learn how to save, invest, and give wisely, how to create a long-term financial plan, and how to get out of debt.

You'll find it all in Master Your Money by Ron Blue, available when you click the Store button at MoneyWiseLive.org. We can talk all we want about how we don't want our children to be like us, but I'm going to tell you, if you think, if you're a parent, just hear me for a moment. And boy, I'm listening to my own lesson.

These things hit me hard. And if I think through what it is I want my children to be, ultimately, I just want you to think, how do you want the thing to turn out for them? Then the best advice I could ever give you, biblically speaking, is become that.

What is it you want for it? Become that. Because we're breaking off, just like breaking bread and giving them peace, we're breaking off what we are and handing that down.

There's no faking that. Even if we go, we can say to them all day long, I don't want you to be like me. I don't want you to be.

I do not want you to be like me. All the while, handing out that piece of stone. Because here are words, nearly as much as they see that piece of rock extended out to them and their great capacity to take that hand off. Just a thought.

A small piece of stone broken off a larger. You've been listening to Beth Moore with today's Quick Word. We have two ways to experience, now that faith has come, a study of Galatians. The online experience is now available at BethMoore.org.

The workbook edition will release in January 2021. Either way, Beth would love to have you in Bible study. Keep listening for another Quick Word with Beth Moore. The financial wealth you leave behind could be the best thing that ever happened to your loved ones or the worst. In Splitting Heirs, giving your money and things to your children without ruining their lives, Ron Blue explains why it's important to make these decisions now instead of forcing your heirs to do it later.

Splitting Heirs will foster a real appreciation for the precious resources that God has entrusted to you. And it's available when you click the store button at MoneyWiseLive.org. So glad to have you with us today on MoneyWise Live. I'm Rich Rozzlin for Steve Moore, joined of course by our host, Rob West, and we're taking your calls at 800-525-7000. Rob, let's go back to the phone lines. Duke is calling us today from Indianapolis, Indiana. Hi, Duke. What's your question?

Hello. Well, I have two 401Ks. I retired a few years ago, and I have a 401K that I had set up with the company I retired from.

And my wife recently lost her job, and she had a 401K with her job. And so we have found ourselves with two separate 401K accounts. And should we combine those is part one of the question. And then part two would be, can we add money to either one or both of those?

Yeah, great questions, Joe. You're not able to combine them. So those are individually held retirement accounts, and they would need to stay that way, each in your own name. What you can do, though, is roll them out to either a new 401K, if you have a new retirement account with a new employer that allows you to transfer one in, or more commonly, they're rolled out to an IRA, an individual retirement account, which again, based on the first letter of IRA individual says it's got to be in one individual's name, there is no joint IRA. And so you would roll your 401K to an IRA in your name, she would do the same into an IRA with her name. Now, where you can combine them is if you had multiple 401Ks out there, or an existing IRA, again, all in your name, perhaps you had a couple of previous employers where you just left them after you moved on. Those could all be consolidated into one IRA in your name.

But again, not jointly held. I think it is advantageous. Number one, it just takes a little bit of the pressure off the bookkeeping and upkeep of them, if you will.

It's one less account that you just have to follow and stay on top of which you should be doing. And so when we can combine them, there's an added benefit there. There may be more advantaged pricing in terms of how it's managed. You know, oftentimes the higher the asset value, the less you will pay in fees, depending on again, how you choose to have that managed. And then thirdly, it's often easier from an investment standpoint to make sure that you have the right overall investment strategy, and there's not unnecessary duplication, or you're not taking on unnecessary risk because you don't realize that these portfolios are being managed differently, or you're overly concentrated in one particular asset class. And so when it's all in one place, a little easier to manage it if you're doing it on your own, especially, and to ensure that you have the right investment mix based on your age, risk tolerance, goals and objectives. So I would be looking to open those IRAs, you need to decide where you want to do that. And to help you think through some of these considerations, Duke, I'd love to send you a copy of Austin Pryor's book, The Soundmind Investing Handbook, I think it'll give you a great overview of the investment world, some of the things you need to know as you move forward.

And it'll do it all from a biblical perspective. So if you hold on the line, Deb, our producer today, we'll get your information, we'll get that right out to you. Duke, we appreciate your call very much. And by the way, if anybody else is interested in getting a copy of The Soundmind Investing Handbook, you will find that on our website, which is MoneyWiseLive.org. That, by the way, is where you can also listen to past programs and connect with one of our MoneyWise coaches, which is a free service that we offer, should you need any help with getting your finances set up. Back to the phones to Phoenix, Illinois. Excuse me, I'm going to the wrong place. We're going to Franklin, Tennessee first. Terry, glad to have you with us. I understand you're considering buying a lake house and a boat. I just want you to know I own a grill and Rob West has some skis.

How can we help? It sounds like a match made in heaven. Go ahead. Nice. Yeah, I love it. So can you hear me? Yes, ma'am.

Okay. So what we were thinking is we've got a lot of equity in our home, like $350,000 in our home. We only owe like $140,000 on the house. So what we were thinking was taking some of that equity and putting it into the lake house and the boat.

So that's my question is do you think that that is a good idea or not? Well, Terry, I think you've got to look at that in light of your overall goals and objectives and the resources that God has entrusted to you. I mean, we could talk just quickly around what is currently going on in your financial life.

I would ask whether you have an emergency fund, whether you have any other debt apart from this mortgage, whether you're on track with your retirement. We don't have a whole lot of time left here before this next break, but just give me a quick overview of that. Yeah. Yeah. So the only debt we have is like the mortgage on our house and we got two cards and then we have, what was the other question? Do you have an emergency savings and are you on track with retirement savings?

Yes. We've got tons of savings or emergency fund savings and we are on track. Okay, great. So what I would do is just pray through this. Number one is I want to make sure however you're using God's money is in line with what you feel like are your values and priorities. Nothing wrong with a lake house if it fits in to how you feel like God is leading and making sure that you have your other financial priorities in place, giving and saving and those types of things. And so if you feel like as husband and wife, this does align with where you're going and you can fit it into the budget.

Certainly we don't like taking on additional debt if we don't have to, but I don't think there's anything wrong with it given what I've heard today so far. And we'll be back with more MoneyWise Live after this. Investing is more than just returns. It's an expression of who you are and what you value. Does the way you invest your money reflect your identity as a Christian? At Eventide, we design investments for performance and a better world so you can invest with a confidence to reach your financial goals while remaining true to your Christian values and commitments. We call this investing that makes the world rejoice. More is available at investeventide.com.

That's investeventide.com. Christian healthcare ministries enables believers to meet their healthcare costs affordably, biblically and compassionately. It's not insurance, but a voluntary cost sharing ministry based on the biblical example of Christians sharing each other's needs. And members aren't fined under the law for not having health insurance. Christian healthcare ministries might be your health cost solution.

Call 800-791-6225 or visit chministries.org. Hi my name is William, a communications major at Moody Bible Institute. The Moody Radio Verse of the Week is found in Proverbs 10, 4-5. A slack hand causes poverty, but the hand of the diligent makes rich.

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Go to mymoodyradio.org, mymoodyradio.org. Do you know if you have enough? Enough money? Enough house?

Do you know how much is enough? If not, Ron Blue can help with his book, Master Your Money, a step-by-step plan for experiencing financial contentment. Learn how to save, invest and give wisely, how to create a long-term financial plan and how to get out of debt.

You'll find it all in Master Your Money by Ron Blue, available when you click the Store button at MoneyWiseLive.org. With SRN News, I'm John Scott. A Kentucky grand jury has brought no charges against Louisville police for the killing of Breonna Taylor during a drug raid gone wrong. Prosecutors say that two officers who fired their weapons were justified in using force to protect themselves. Head Officer Brett Hankinson was charged with three counts of wanton endangerment for firing into the apartments of Taylor's neighbors.

Federal investigators looking into whether a huge wildfire near Los Angeles was sparked by Southern California Edison utility equipment. Senate Republicans moving ahead with plans to confirm President Trump's pick to fill the seat of Justice Ruth Bader Ginsburg on the Supreme Court. The president set to announce his nominee on Saturday.

Stocks closing sharply lower, the Dow dropped 525 points, the NASDAQ was off 330 and the S&P 500 fell 78. This is SRN News. Glad to have you joining us today. You're listening to MoneyWise Live on Moody Radio.

I'm Rich Rozzle with our host, Rob West. Ecclesiastes 5-10 says, whoever loves money never has enough. Whoever loves wealth is never satisfied with their income. This, too, is meaningless. And that's one of the reasons that we want to remind ourselves and remind you that God's the owner of it all. It's not ours.

So our job is to be the proper manager of it and to become MoneyWise from a scriptural standpoint. Rob, right before the break, we were talking to Terry, rather, who called in. She and her husband were trying to decide about whether they should buy a lake house and a boat. And I apologize. We didn't have a lot of time for that before the break. But did you have some some final thoughts on that? Well, you know, this is where the rubber meets the road and where we all, as stewards of God's money, have to make a decision for ourselves as to what lifestyle do we want to live? How much is enough?

And that doesn't mean we automatically just need to eliminate everything that would fit into the want category. I think we need to pray through it. I think as husband and wife, if you're married, you need to talk through your values. What's important to you? Where is God leading? Clearly, in the Book of First Timothy, we see that part of the role of God's money is that we should enjoy it, right? So we're to provide and we're to live with contentment, but we're also to enjoy what God has given us. So in the context of a well thought out plan where we're giving first and in unencumbered and able to respond to the leading of the Lord and the Holy Spirit to meet the needs around us and perhaps even to lean into our passions from a giving standpoint. And we're able to save for the needs of our family now and in the future. And we're able to, you know, provide for the expenses that are the needed things, transportation and housing and putting food on the table. Then if we have a surplus, the question is, Lord, what would you have me to do?

And does that mean it's automatically eliminated the idea that we would buy a boat or a second home? That's for each person to decide prayerfully. And I wouldn't say that it is an automatic no. Again, I think we need to think through how are we using it? And is it something that's becoming, you know, is it taking the place of the Lord in terms of the object of my affection? Is it for a status symbol?

Or is it just purely for enjoyment? And I feel like that God has allowed me to go in that direction. I think that's what we have to wrestle through.

We've got to spend the time to pray through it, talk through it, and really think about how much is enough for each of us. And that's part of the journey of the Christian steward, I think, as we manage God's money. I know for a lot of people, whether it's a new car or a new boat or whatever the thing is they're looking at, for me anyway, a lot of times things are a little shinier and sparklier to my eyes than they are in real life.

And I may be, you know, wanting to buy the latest whatever, and I'm thinking that's going to satisfy some need. And then I get it and I find, you know, it really doesn't. So, you know, praise God over the years, the sparkle is less alluring.

Yeah, I think that's right. But I also think there's an opportunity to use things like that for God's glory. We have some friends that have a beautiful lake house and they are constantly doing retreats there. They're doing Bible study getaways.

They're taking the youth group up there. I mean, they are using it in an incredible way that's furthering relationship and deepening walks with Christ. And does that mean that's for everyone?

No, but it's being used, I think, very well for them. And so, again, there's not a right or wrong answer here. I think each of us needs to wrestle through it. Yeah, but again, as you pointed out, that's the heart attitude.

Their heart is in the right place in buying that as opposed to, I want it to, you know, for whatever reason. Anyway, let's head back to the phones. 800-525-7000 is our number. If you don't get in today, just write it down and have it ready for next time you want to call in. We'll go to Phoenix, Illinois now. And Tyrone, glad you waited. You're next on MoneyWise Live.

How can we help? Thank you for taking my call. You may have answered it on the call before the last one. I have a return, tax return that my wife and I want to reinvest. And I was looking at which vehicle would be better to put it into a Roth or to put it into CDs to earn. It'll be part of our emergency expenses, but not all of it. I see.

And the last part is what's most critical for me, Tyrone. We've got to decide the purpose of the money first. And it may be that it's enough that it has multiple purposes, but to the extent it is part of your emergency fund, I would like for you to keep that, at least from my perspective, in a liquid savings account. I wouldn't lock it up in a CD, especially in this very low-interest-rate environment. Right now, a 12-month CD is probably in some cases lower than you can get in a high-yield savings account with daily liquidity.

So I just don't think there's enough reason for that there. And I wouldn't put it in a Roth, even though you can get the money back, the original contributions on a Roth, without any penalties, as long as you don't take out the gain, the profits, or the dividends. I understand you can get it back without penalty. But again, if it's invested, it really needs to have a 10-year plus time horizon. And I would expect money in a Roth would be invested. So that portion that is your emergency fund that you've set aside and we recommend as a guideline three to six months worth of expenses, I'd put that in a savings account, probably a high-yield account like Ally or Capital One 360 or Marcus, and then I'd link it to your checking account. So it's not readily available in your daily spending account, but with 24 or 48 hours, you could electronically move that money over if you needed it for a hardship.

Now, if you had additional money beyond that, that you said, I want to put this away for retirement, then a Roth is a great option to do that where it could be invested. You're not worrying about the daily moves of the market like we had today with, I understand, down 500 points. But you're not concerned about that.

You're looking at the long-term trends and that's where you win with a stock and bond portfolio. Does all that make sense, though, Tyrone? Yes, it does. All right. Very good. We appreciate your call today. God bless you, buddy. Thanks, Tyrone. And I think we may have time to squeeze in a quick one here. Brian in Chicago, Illinois, just a couple of minutes.

What's your question for Rob? Hey, so I'm 65. I can work till I'm 70, probably. And I'm wondering about the Social Security strategy. Rumor is, and I've heard it more than once, that by 2035, Social Security may be gone. So that puts me at 80. And I'm thinking about my wife, you know, and she's gonna probably outlive me. So is it wiser to wait till 70 and get that 8% a year gain or should I start taking it earlier because it may run out?

Yeah, yeah. Well, it's a great question, Brian. And what you're referring to there is in this 15-year period is that based on the current trends, the estimates say that the Social Security Trust Fund will run out by 2035. And what that means is that the more is going out than coming in, largely due to the baby boomers retiring at the end of 2019.

I believe there was something like three trillion in the trust fund. But again, that's headed down. Now, that doesn't mean Social Security benefits will end then.

What it means is there won't be enough revenue coming in to meet the program's obligation. So something's going to have to be changed. So far, Congress has kicked the can, meaning they just said, we'll deal with that down the road.

They're very good at that, unfortunately. Of course, the longer lawmakers wait to take action, the more severe the changes will have to be. Those generally in terms of the resolution for that they generally fall into two categories, either tinkering with taxes to steer more money into the program, perhaps meaning an increase in the FICA taxes or tinkering with the benefits to bring more out bring the outgoing line with the income that could be freezing benefits and the cost of living adjustments for a time. Politicians obviously don't want to do any of those because they're not popular, but they'll have to and my experiences when our backs are against the wall, we do what we have to do to make the accommodations we need to make. So bottom line is, I if you don't need the money, I like the idea of you delaying and getting that higher check.

And I think the changes will be made as needed to adjust for future revenues. Brian, excellent question. Thanks so much for calling today and being a part of Money Wise Live. Your host is Rob West. I'm Rich Roslin for Steve Moore.

We'll be back with more calls right after this. God cares a great deal more about our money than most of us imagine. In fact, Jesus says more about our use of money and possessions than about anything else, including both heaven and hell. In Managing God's Money, author Randy Alcorn breaks it all down in a simple, easy to follow format that makes it the perfect reference tool if you're interested in gaining a solid biblical understanding of money, possessions, and eternity. Managing God's Money is available when you click the store button at moneywiselive.org.

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Hi, I'm Bernie Dymott. But you leave a grapevine to its own devices and it shoots out long, leafy branches. From a distance you think, wow, what a beautiful, healthy vine. But you get up close and you'll find precious little fruit. You see, to grow grapes, those branches have to be pruned back hard. You can either have a flashy-looking vine or you can have fruit, but you can't have both. Sometimes we go through a rough patch in life and we think, whoa, what's all that about? Jesus said every branch that bears fruit will be pruned. In the tough times when we ask, where's God, all the time he's very carefully snipping away at our branch. You see, he's not so much concerned about how we look from a distance. He wants fruit in their lives.

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I'm Rich Rozzle, Rob West joining me as well on the program, of course, as our host. A quick reminder that MoneyWise Media is a nonprofit organization. We do our best to minister to God's people and teach them how to be good stewards of God's money.

And one of the ways you can help with that, and we'll be helping you at the same time, is by contributing. You can go online to MoneyWiseLive.org. And with your gift of $25 or more to MoneyWise Media, we'd like to send you a special thank-you gift, and that is the book Thriving in Love and Money by Shanti and Jeff Feldhahn. It's a great money book that they say is not actually about money. You can uncover the issues that cause money conflicts, and you can learn truths that are relationship game changers. And again, you can request your very own copy with a gift of $25 or more to MoneyWise Media. Just go to our website, MoneyWiseLive.org. Back to our phones at 800-525-7000. Alicia from New Mexico, you're next.

How can we help? Hi. I had a couple questions about refinancing. All right. Okay. And it sounds like you're in your vehicle. I am, yes.

I'm parking right now. My questions were, one, I'm getting offers to refinance my vehicle. I know I was encouraged to wait two years to refinance. So when is the best time to refinance? And my next question is, how can I do my own research to find the best option for refinancing? Yeah. Sure.

It's a great idea, Alicia. Have you seen an improvement in your credit score over these last couple of years? No, it stayed about the same. If anything, it did go down because I didn't put myself in debt per se. You know, I didn't refinance anything. I just had a credit card that I was paying on. So that kept my, I believe that was the only thing that really kept my credit score in good terms.

Yeah. Well, if you at least maintained, I mean, rates are very low right now. This summer, the average APR on a new auto loan of any length was around just over 4%. And that was down from an average 6% the borrowers were getting in June of 2019. Now, obviously, there are incentives that the dealers will provide on new cars from time to time that, you know, where you can get it all the way down to 0% if you're in the right credit range. But the bottom line is the right time to refinance is either when your credit health has improved, your score has gone up. Since you bought the car, you've made on time payments or rates have declined significantly. In this case, you know, we've seen a drop in some cases of up to 2%, then that better rate that you potentially could qualify for could save you money over the life of the loan. And so it'd be worth looking at the other situation where we would encourage folks to refinance is where, when you're not underwater on your current loan, or generally speaking, it's easier to find a lender who will work with you when your car is worth more than the remaining loan balance, because obviously that protects them on against default. So where do you go from here?

Well, I would probably head over to one of our favorite sites. When you're looking and shopping for credit, which is bankrate.com. They'll put you in touch with lenders that specialize in auto loans, many of them will be online banks, which I don't have any problem with. So you can compare one versus another, I'd probably pick two or three and see how you qualify make sure the cost of the refinance can be justified in the form of lower interest over the life of the loan. So count the cost and look at what the savings really is going to be.

And if it looks like it makes sense, then I would go for it. Again, bankrate.com is that website. And Rob, I know with mortgage refinancing, we always encourage people not to extend the length of the loan. So you know, if you're if you're in this situation, and you're halfway through, it would be good to get a shorter loan. So you're not extending your payments out. I mean, I assume that applies for cars too, right? It sure does. Yeah, the key there is you all that savings and interest could be eaten up by a longer term.

So yeah, keep the loan the same term or less. Very good. Alicia, thank you so much for calling. We appreciate that on to Chicago, Illinois. Denise, glad to have you with us on Money Wise. How can we help you?

Hi, good afternoon. Just two quick questions. So I'm self employed. And I was wondering if I can get an IRA? And what what I need to do or what percentage to go into that if I can get one? Yeah, well, you can anyone can have an IRA and you can contribute up to $6,000. If you're under the age of 50 for the year 2020. If you're over 50, you can put in an extra 1000 or 7000 up to the amount of earned income you have for that year. So as long as you have 6000 in earned income, you could put in the full 6000 for this year anytime before you file your 2020 tax return even into next year.

So absolutely you can and I would encourage you to do that. As to how much you should put in we generally recommend as long as your emergency fund is in place and you've got your credit card debt paid off if you were to have any. The goal on long term retirement savings is 10 to 15% of your compensation of your pay going into some retirement accounts starting with usually a 401k or 403b where there's matching. But in your case, because you're self employed, you wouldn't have that. So the IRA is a great starting point. If you found an ease over time that you wanted to be able to put away a little bit more than 6000 which you know, as you earn more money, you'll probably bump up against that limit.

You may want to look if you continue to be self employed and other options like what's called a SEP IRA, which would allow you to put in quite a bit more or an individual 401k which are exactly what they sound like their 401ks for individuals where you are not a part of a company that's offering a company sponsored retirement plan but short answer Yes, you can do an IRA and I would head over to soundmindinvesting.org to learn a little bit more in terms of where you open that Vanguard Charles Schwab, Betterment any of those would be great options. Next to Indianapolis, Indiana, Monica, glad to have you with us on money wise live what's going on with you? I am my backs against the wall. I got ill pretty sick still that's been a year and a half went through the whole process of short term long term now trying to get disability etc. So with all this my medical expenses have pretty much zapped me dry financially. And I've tried to I was in hope that I would get better. So I was just using my credit cards in order to keep going.

I have them all maxed out now. So like I said, my, my backs against the wall. I don't know what to do. From this point.

I don't want to file bankruptcy if I can prevent it. Yeah, yeah. Monica, I'm so sorry to hear about the challenges that you've had.

Is your health such that you're able to work full time now? I know I'm like, pretty much bed bound. Okay. Well, obviously, this is a challenging situation. And yet this didn't catch the Lord by surprise. So we need to ask him to intervene here.

First of all, with a physical touch. You know, he is the great physician and we'll ask him to intervene medically on your behalf to bring healing to your body according to his perfect will. He is also your provider, Monica. And so we need to look to him for wisdom and guidance, perhaps even to the body of Christ to step in in a very difficult situation. Are you plugged in and connected to a local church right now? I am and I try to watch their services when I can online since I'm not able to go to actual church.

Yeah. And are they aware of the situation medically and financially? I have not told them yet. But I feel like I need to at this point. I am just one individual that is independent.

And usually I kind of have things lined up, you know, all my savings and that kind of thing were used for this, you know, this event. So to be from like a credit score of 800 down to in the five to 600 is very unsettling to me. And it makes me sad, to be honest. Well, I can understand that you want to be a good steward. You also want to honor your obligations and to the extent you're unable to do that because you're simply out of work and you've had nowhere to turn to be able to pay these back. That's challenging.

And so I know that's got to be hard for you on so many levels. I would let your church know, Monica, what the situation is. This is where the body of Christ can rally around you from an encouragement standpoint, prayer support, even potentially financial assistance. I'd love for you to reach out to our friends at Christian credit counselors dot org. Let them look through kind of the current state of the situation, advise you on how to communicate with your creditors. Bottom line is you won't find the word bankruptcy in the Bible. It's a modern legal term we've created and you may be forced into bankruptcy regardless of whether your ultimate goal is to honor these debts as you're able.

The bottom line is you can only do what you can do with what passes through your hand. And so we need to pray the Lord will bring healing to your body so you have the ability to work. And we need to get a handle on what the current state of your finances is. And we also need to make sure that you're communicating very clearly with your lenders because if you are unable to pay due to the situation you're in, that's just the reality.

They're not unfamiliar with these situations. They happen and they will work with you. So reach out to our friends again, Christian credit counselors dot org.

Let them walk through this with you, develop a budget, get a detailed listing of your assets and liabilities, and let them advise you on what the next steps are. And we appreciate your call today very much. We'll ask our Money Wise Live community to be praying for you. And by the way, Rob, I greatly appreciate your mentioning Let Your Local Church Know because I think we're all such private people.

We don't like to let other people know or we forget to let other people know. And I guess this should be a reminder to churches, too, in our disconnected days these days. It's very important for you to check on your fellow church members, check on your friends and see how they're holding up and how they're doing. Rob, our time is about up for today. Thanks so much. And from my schedule, it looks like I'll be forcing myself back on you tomorrow as well. I'm glad you're coming back, Rich. I appreciate you sitting in today. I look forward to it. Okay.

Thank you, sir. Our top notch team today is comprised of Deb, Gabby T., Amy and Jim. Our host, of course, is Rob West. I'm Rich Rosselin for Steve Moore. Thanks for joining us on MoneyWise Live!