Coloring Within the Lines of Personal Finance

We teach our children the benefits of following the rules from an early age. Coloring within the lines, for example, always results in a much prettier picture.

But as adults we often forget those same rules are meant to help us. Coloring within the lines as we manage money is our topic today. Kingdom Advisors President Rob West has some simple rules guaranteed to beautify your financial picture. We also have some great calls lined up, but we are pre-recorded today, so please hold your calls until next time. I'm Steve Moore.

Get out your crayons. This is MoneyWise Live. So Rob, why do we so often want to break common sense rules that we know really are good for us, especially when it comes to managing our finances? Well Steve, I'm no psychologist and I don't want to play one on the radio, but if I had to guess, I'd say it's about delayed gratification. Following the rules requires discipline that pays off later. On the other hand, when you break a rule, say by making an impulse purchase, it feels good for the moment, although it's almost always temporary. Now, following the rules often takes much longer to realize the reward. Saving for an emergency fund is a good example. You do it a little at a time and you don't see the benefit right away, but it sure feels good to have that money available when your car suddenly needs a new transmission.

Yeah, been there, done that. Okay, so you've got some rules for us that will help us color inside the lines with our money, so where do we start? Well, the absolute most fundamental rule you must learn to follow is spend less than you earn.

Everything hangs on that, Steve. Without it, you can't save for the future and you'll most certainly go into debt. And of course, you'll probably never spend less than you earn if you don't live on a budget, so that's the next rule. Prepare a written budget or spending plan detailing all of your income and expenses. Set spending limits for each category and stick to them. By the way, our new MoneyWise app in whatever app store you use is available.

I think you'll really enjoy it. Now, that leads to the next rule, and it's one we often forget about. Analyze your monthly bills. You see, if you don't do this fairly regularly, you may not see costs creeping up in things like your phone or cable bill. Banking fees tend to sneak up too, so call and request to have unwanted line items removed, and if they won't do it, well, cut the service or look for another provider. Yeah, a lot of folks don't realize that sometimes a simple phone call can get a charge removed from your bill or maybe even a lower interest rate on a credit card.

It never hurts to ask anyway. Alright, what else? Well, the next rule, Steve, is another absolute for managing your money. Build an emergency fund. The alternative, again, is debt.

Things break and need repair. Unplanned expenses always rear their ugly heads, and you've got to have cash on hand to handle them. We talk about this next rule a lot too, and that is avoid or eliminate high interest debt.

Use the snowball method to get rid of it quickly, paying off the smallest balance first, and so on. Let's see, next is save for retirement. Social Security won't be enough to support you when you can no longer work, so you have to put money in long-term investments. By the way, Social Security was never intended to cover more than 40% of your pre-retirement income. And this leads, Steve, to the next rule. If your employer offers a 401k or 403b retirement plan with matching, squeeze every dime out of it you can. I'd say contribute enough to maximize your employer's contribution because it's free money, and if you don't have a retirement plan at work, well, an IRA can be the next best option.

Okay, these are coming hard and fast. All right, any other rules about retirement savings? Oh yeah, don't touch it. Way too many people these days tap into their retirement funds to pay off debts or for other reasons that really aren't emergencies. That's another reason why you need an emergency fund. So let your retirement earnings grow, and as we like to say, your future self will thank you. Okay, those are all great rules, and regular listeners to our program certainly know about them, I'm sure. What else are we going to raise to the level of a rule? Well, the next rule is buy cars for transportation, not status. Consider the reliability and fuel efficiency when buying a car.

The more reliable and the more fuel efficient a car is, the less it will cost you down the road, pun intended. Okay, good job. So there you have it, folks. Rules to help you color inside the lines and beautify your financial picture. Thanks so much, Rob. Hey, you're listening to MoneyWise Live with Rob West. Today's broadcast is prerecorded, so we won't be taking any calls, but we have some calls lined up and some great information coming your way that I think you'll find usable at the very, very least. This is MoneyWise Live. I'm Steve Moore.

We'll be right back. 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. For 30 years, SoundMind Investing has been helping Christians reach their financial goals with step-by-step guidance for investors at every stage, from those just getting started to those getting ready for retirement. Through scriptural principles and practical suggestions, SMI offers financial wisdom for living well.

More information, including a short video webinar on profit and peace of mind, no matter what's happening in the market, is available at SoundMindInvesting.org. The late columnist for the New York Post, Earl Wilson, made this simple observation about the power of science. Mathematics, he said, is a wonderful science, but it hasn't yet come up with a way to divide one tricycle between three small boys, and all the parents said, amen.

Math and other sciences seem to have the most answers where things are involved, but as soon as one or more people enter the equation, science is stumped. You see, people need nurture, not numbers, and fairness, not formulas, and above all, people, even small boys with tricycles, need God to help them solve life's thorniest problems. This is David Jeremiah, encouraging you to get on the road to new life. Discover the ways God can help on Route 66. Route 66, driving the word home.

Log on to Route66Life.com. Start your journey home today. 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% 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. In addition to our radio program, don't forget you can check us out online. You'll find us at MoneyWise Media when you're on Facebook, and our website, of course, is MoneyWiseLive.org. Lots of free resources there, links to past radio programs, ways to connect with a kingdom advisor, and much, much more.

MoneyWiseLive.org. Winnebago, Illinois. Hi, Scott. What's on your mind today?

How can we help you, sir? I started a new job. I can't get into their 401k for at least a year. I have a 401k with my old employer, and I was just wondering if it's best to just leave that sit? Should I roll it over into something else or wait till I can get into my new 401k?

Not sure where I should go with this. Yeah, Scott, I would roll it out to a traditional IRA that you would open at another institution. Reason we recommend that is it's going to open up your investment options, especially in a market like we've been in now where prices are considerably lower than where they were three weeks ago. You could get into some really high quality mutual funds based on your investment strategy, time horizon, and risk tolerance, but you'd build a portfolio that you could move into and then benefit from the appreciation and growth of that over the long haul.

Doesn't mean it won't go down before it goes up even more, but the bottom line is you would be well positioned to take advantage of the appreciation in the market down the road. But the extended and expanded investment options through the IRA are really the best thing you have there. Secondly, you have more control over the fee structure.

So inside the current 401k, there's plan administrator fees and other fees that are putting a drag on your investments and you really have complete control over how you want the fees set up in your IRA. You could go with a real low cost ETF portfolio or a robo advisor. You could hire an investment advisor who would manage it for you.

You have any number of choices, but you're in the driver's seat there. And so I like the idea of you rolling that out and not continuing to leave that there. And then certainly by all means, when you are able to begin participating in the new 401k, especially if there's matching, I would jump in that with a goal of 10 to 15% of your take home pay. And if you don't, in the meantime, while you don't have that, you can contribute to this traditional IRA that you'd be rolling these funds into while you're waiting.

And again, now's a great time to be investing systematically into the stock market through what's called dollar cost averaging. So, do you follow all that? I guess one question that I do have is I don't think my new employer matches. Okay.

All right. Well, you could certainly start with the traditional IRA, which again would give you many more investment options. But you'll find that, you know, if you're under 50, you're going to bump into that $6,000 cap in terms of what you can put into the traditional IRA. And that's where even without a match, you're probably going to want to take advantage of the 401k just because there's a lot greater contribution dollars that can go into that because the limits are much higher.

So that's where even without a match, you'd still want to use that when you exhaust the annual contribution limit to the IRA. All right, Scott. Yep. Thank you. God bless, Scott. Thank you very much. We appreciate that.

Let's go to Chicago, Illinois now. And we say hi to Trish. Trish, we're so glad you called today.

How can we help? I'm calling because I've never heard of Care credit card and my dental office signed me up with it. And I just received a letter that the account will be closed if I don't use it. And I don't want it to ruin my regular credit that I've got, you know, to get a new apartment.

And I've struggled with that to make sure I have that good, you know, value. So I don't I heard if credit cards are closed, it lowers your number, your score. Yeah. So I don't know anything about this one. Sure. Trish, let me help you with that.

You know, it's really not as big of an issue as you might think. First of all, do you have other accounts that are being reported to your credit report on time every month? Oh, yes. I've been taking good care of that.

OK, very good. So where the issue comes in is, number one, the biggest issue people have is with something called credit utilization. So think about all the different credit lines that you have available to you through available credit on a credit card or something else.

There's a total there. And then think about the balances you're carrying. Hopefully you're paying those off every month. But if you are carrying a balance, think about what that is in relation to the total credit available to you. Again, across all these accounts, that number is when we convert that to a percentage of the total credit is something called credit utilization. How much credit are you using versus what's available to you in total? When you take one of the cards out of the equation, the total credit available to you comes down, which means that if you're carrying a balance, it's a higher percentage or a higher utilization of the whole. But if you're responsible with your credit, you're paying your credit off every month and when you're using credit cards, then that's really not a concern to you. So taking this one account, this care credit account out of the equation is not going to have much effect on you because, again, you're not carrying high balances. Number two, as long as you don't close multiple accounts in a very short period of time, it really should have a negligible effect.

I'm talking probably 10 or 15, maybe 20 points at the most, but then it would come right back over a matter of months. So if this is not an account you're using, I actually like you closing this because it's one more account that doesn't have the potential to be compromised and used fraudulently without your authorization. And if it's open, you really need to be checking it regularly either through your credit report or through the account itself to make sure that nobody's using it without your authorization. But if it's closed, then that's not an issue any longer. So I'd go ahead and let it be closed if you don't have any intention of using it and I wouldn't worry about your credit. I don't think it'll be affected. If it is, it'll be a very negligible amount and it would return to its previous level in a very short period of time. Does that make sense?

Do you understand that, Trish? Yes. The only thing is my credit cards are through my bank and I don't know where this money would be coming from if I used it.

That's what I'm concerned about because it does say it's good for chiropractic and my insurance now, I can't go to the chiropractor that I have always gone to because it's not qualified with my insurance and this shows chiropractic. So I'd almost like to use it for that. But where does that money come from?

Yeah. This is basically just a credit card. It's healthcare financing. And so you can use this particular credit card to pay for your deductible or treatments or procedures, but you're going to have to pay it off just like you would with any other account.

So there's not really any benefit to you in using this particular care credit account versus using one of your other methods of payment. So I wouldn't think twice about closing it. And Trish, with that, we're going to have to let you go today because we're out of time, but we wish you the best. Thank you very much.

Great question. You're listening to MoneyWise Live with Rob West. I'm Steve Moore. A brief pause, then we'll come back and chat some more. Our phone number again, 800-525-7000. Don't go away. 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. Hebrews 4-12 says, For the word of God is quick and powerful and sharper than any two-edged sword. Here's Beth Moore with a quick word. John 21, 5-11, in verse 5, They saw him on the shore, but they did not know it was Jesus. And he called out to them, Friends, haven't you any fish? I always, when Keith's coming in from a fishing trip, I always am a little reluctant to ask the big Q. The big Q is going to be, Did you catch anything? So what I love to say, I begin by saying, Did you have fun?

Because to a sanguine, that's what it's all about. Did you have fun? Whether you caught a fish or not, did you have fun? Because the big question is going to be, Did you catch any fish? Well, he already knew they hadn't.

No, they answered. And he said, Throw your net on the right side of the boat and you'll find some. And when they did, it says, are you reading with me? Because it's in 6.

When they did, they were unable to haul the net in because of the large number of fish. Then the disciple, whom Jesus loved, said to Peter, It is the Lord. And as soon as Simon Peter heard him say, It is the Lord, he wrapped his outer garment around him, taken it off and he jumped into the water, and the other disciples followed him in the boat.

I love that. This is a lesson of its own because it talks to us about just how much we want to see Jesus, how much we're willing to jump out of the boat. Because I'm going to tell you, some of the biggest drawbacks you and I will ever have to having a fiery, holy passion for the Lord Jesus Christ and going anywhere and doing anything will be our own Christian brothers and sisters that hold us back. Because we're going to find that comfortable place with all of us together.

Because who wants to leave out of the boat? Beth and Tim are thankful for the grace gift to serve you. Your letters, prayers, and support are a vital part of this program. To request this month's thank you gift, text the word GIFT to 57682.

Again, text G-I-F-T to 57682. Or go to Bethmore.org forward slash donate. That's Bethmore.org forward slash donate. 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. We're MoneyWise Live. He's Rob West.

I'm Steve Moore. And this quick reminder that today's broadcast is prerecorded. We're not really here in the studio, but we planned that in advance. And we've lined up some interesting callers in advance.

I think you'll enjoy these and perhaps even learn something along the way. So stick around. Hazelton, Pennsylvania. Hi, Teresa. What's on your mind? My family is looking to buy a family car. We need a used car from the year 2016 to 2018.

Okay. Let's start there with the car you're looking to buy. What questions did you have specifically related to the car you're looking to purchase? Yeah. Some costs that we can avoid buying the car.

Yes, ma'am. What you're referring to is some of the fees that you should expect to pay and others that you may not have to. Let's go through some of them. There's the dock fee. And this is where you pay the dealer for all the paperwork that they have to put in place to complete the transaction. This can be anywhere from one to five hundred dollars.

That one's a little challenging to get them to remove. But if it's anywhere over five hundred, I would certainly challenge it. The next one is what's called the destination charge. This is where the charge where the automaker charges the dealer for getting the car from the factory into the lot.

They'll almost never budge on passing that along to you. So I would expect to pay that. And then there's the state sales tax.

You're in Pennsylvania, so you do have a state sales tax, so you should expect to pay that as well. And then beyond that, there's perhaps a maybe charge. If you see an advertising fee, I would try to negotiate that down or away. They may insist on charging you for it. But in terms of the fees that you shouldn't pay, there's one called a dealer preparation charge. This is the charge for preparing the vehicle for display on the lot. I would absolutely try to negotiate that one away. And then if they try to charge a fabric protection fee specifically to protect the fabric or the paint, I would ask to skip those as well.

So the first few that I mentioned, they're probably OK as long as they're not higher than they should be customarily. But the dealer preparation charge, the fabric protection, the paint protection, I'd really see if you can skip those. Another big one, Teresa, that lots and lots and lots of dealers try to sell you on is etching your VIN number into the windows in case your car is ever stolen. But the VIN number actually is attached to every different body part on the car, so you really don't need it etched into your windows. It probably costs the dealer $15 to do it and they charge you a lot more.

So even if it's done before you get there, tell them you're not willing to pay that. OK? OK. OK. All right. We'll listen all the best to you, Teresa. We appreciate you checking in with us. All right. I think we lost Teresa there. Teresa, thanks very much. All right. Let's go to Mountain Iron, Minnesota.

Hi, Lee. What's on your mind today? Well, I have to move from where I am at the year on the Iron Range in Minnesota to Fort Wayne, Indiana, to be near to my in-laws because my father in law is ill. And I've been renting for these last 10 years because I knew I didn't want to live here forever. But I am wondering, with a VA loan, I don't have to have a down payment. And I have been qualified for an $80,000 loan, which isn't a lot, but it's enough to get a decent-ish house where we need it. Is that better to do than to go ahead and rent? Yeah. So you don't have a down payment, is that right, Lee? That is correct.

Yeah. You know, I would really discourage you from doing that, even though the VA will allow you to get 100% financing. I really like you taking the time to save and have a decent down payment. I would usually classify that as a 20% down payment. I realize that would mean you'd have to rent for a while, but I don't think that's a bad idea, especially given some of the uncertainties around the economy.

And so I think you moving, renting for a while, getting a lay of the land, figuring out where you'd like to live, ultimately getting accustomed to the community, and saving, keeping your lifestyle low so you can put away a good bit to be able to put that meaningful down payment in place would be what I would encourage you to do. I think you'll be glad you did. Oh, good. That's kind of what I was thinking, but the rent is about the same as the mortgage payment, so I wasn't quite certain.

But I was thinking along those lines, too. Thank you so much for your program and for answering my question. I really appreciate it.

Absolutely, Lee. We appreciate you listening and calling today. May the Lord bless you in this move. Yeah, thanks so much. Thank you very much.

All righty. Rob, lots of young couples getting married, and we often hear from many of those couples who say things like, we weren't sure we were in a position to buy a house during our first year of marriage, but with rates so low, our friends and family are pretty much saying we're nuts not to get a mortgage, even if we can't afford it. After all, Mom and Dad are going to help us with the down payment. I appreciate the excitement, but I'm thinking a little longer term.

What's your feeling about that? Yeah, Steve, I would really not use this as an excuse to get beyond what would be considered sound financial wisdom. There's a reason that we say delay a home purchase until you're ready. As a new couple, you're just learning what it means to be married and combining everything in your life, including your finances, and kind of figuring all of that out. It's an exciting time, but to add the pressure of a home bought prematurely where there's financial pressure is just not something you want, even though the rates may be too good to pass up, quote, unquote.

So I would say pass on it. We're going to be in a low rate environment here in my estimation for quite a while, and so I wouldn't get ahead of yourself in trying to push to do something that you're not ready for, even though you're going to hear people tell you historic rates will come and go, you got to do it, don't buy into it. As you know, Rob, I tend to be a little on the older side. I can remember back when we had two stations, maybe two and a half stations, everything was in black and white. And back then, the first year we were married, a great rate, something that really made your heart beat fast, was seven and a half percent. Can you imagine that? Seven and a half percent, and you were blessed to be able to find that. And look how things have changed. We had a caller this week who was talking about the 12 percent mortgage interest rate that they had.

So, yeah, this looks pretty attractive somewhere in the twos and threes and even the fours. All right. But bottom line is count your biblical chickens. Think long term. Obviously, if you can put 20 percent down, that's a much better approach, even if you can get a V.A. loan. Any other thoughts in that regard?

Is that pretty much it? I think, well, I'm not sure what biblical chickens are, but other than that, no, I think that's exactly right. And here's one other piece of advice I would have is as you're thinking about getting married, as you're heading toward that day, how exciting. Talk about what money was like growing up.

Start talking about the lifestyle you think God is leading you to make some of those decisions now as you begin to put your finances together. And don't count your chickens before they hatch. That's what I meant. Not a Chick-fil-A reference. OK, stick around.

We'll be right back. 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 the 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 Health Care Ministries enables believers to meet their health care 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.

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Hi, my name is Rose. I'm a communications major at Moody Bible Institute. The Moody Radio Verse of the Week is found in Deuteronomy 6, 6-7. These commandments that I give to you today are to be on your hearts, impress them on your children, talk about them when you sit at home and when you walk along the road, when you lay down and when you get up.

That's Deuteronomy 6, 6-7, the Moody Radio Verse of the Week. Every child needs these four gifts from their dad. Relationship, integrity, teaching and experience. I'm Drew Dick, host of Moody Publishers Reading for a Change podcast. Brian Loretz just released a new book, The Dad Difference. Brian illustrates the importance of a father's role in their children's life by methodically walking you through the process of putting these four gifts into practice. Get your copy of The Dad Difference available now at moodypublishers.com.

That's moodypublishers.com. 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 MoneyWise Live.

With SRN News, I'm John Scott. Thousands of airline employees getting furloughed while the companies wait to see if they'll get more money from taxpayers. The White House has included $20 billion for airlines and a $1.6 trillion COVID-19 relief proposal. That's closer to the House Democrats' $2.2 trillion plan, but an agreement's still up in the air.

Russian opposition leader Alexei Navalny, who is recovering in Germany after being poisoned in Russia by a nerve agent, accusing Russian President Putin of being behind the crime. The NFL postponing Sunday's Pittsburgh Steelers game at Tennessee until later in the season. That's after two more people on the Tennessee team tested positive for COVID-19. Stock indexes ended higher after another day of back-and-forth trading.

The Dow gained 35 points, the NASDAQ up 159, and the S&P picked up 17. This is SRN News. God's Word. John 1335 reminds us by this. All men will know that you are my disciples if you have love for one another.

And that verse works in all sorts of times, pandemic or no pandemic. Good to have you with us today on MoneyWise Live. Austin, Texas. Marina, thanks so much for calling. And what's your question?

Good afternoon. I have a daughter that's going to be 23 at the end of the month, and I've been bugging her about researching on how to do some investment because she's been able to save some money through this furlough. And she just really hasn't done it because she doesn't know what to do. And I want her to have a leg up in life, and I cannot direct her. So what would you recommend?

Yeah. Well, there are some great options out there, Marina, for somebody who's just getting started more than ever. And many of them are very low cost and very easy to use.

In fact, for a 23-year-old who's grown up in a digital world with a smartphone at their fingertips, there's some wonderful app-based solutions out there as well. But the first question I would always ask is, what's the purpose of this money? Is this money that is truly long-term, where you're thinking, man, if she could start now and just socking away a certain amount every month, starting with what she already has for retirement, and then just not touch it and let it grow, that's what you have in mind? Or are you thinking investing, but you want her to be able to use this money within five years or certainly within 10 years? What would it be? A little bit of both, some to set aside for the long term and some that if she needed to access it because if she found her dream home and if she's got some money put aside that's making money for her, then that would ideally be the best idea.

Okay. Well, so here's what I would do. I would have her open up two accounts. One is a Roth IRA. She can put in up to $6,000 this year for 2020, and she can do that as long as she has earned income. I would open that Roth IRA probably at Betterment or through the Schwab Intelligent Portfolios.

Either one of those are going to be app-based. They'll ask her a series of questions. It'll build a very low-cost, very well-diversified portfolio for her using indexed ETFs. Basically, that's just a fancy way of saying she's going to capture the broad moves of the market in a portfolio that's tailored to her where it's more aggressive, but it's not banking on one particular stock. She owns the market, and she'll capture, again, these broad moves of the market over a long period of time.

So either Betterment or Schwab Intelligent Portfolios, very simple to do, very low cost. And if she just starts putting in that $6,000 this year and $6,000 next year, and she does that every year, she'll literally have hundreds of thousands of dollars when she's ready to retire in addition to whatever she might have from a 401k or something else. Then with the balance, what I would do is encourage her to open a second account, which is a high-yield savings account, and have her connect that to her checking account. She could do that at Ally Bank. She could do that at Marcus.

Either one of those have great websites. They have great apps, and she'll get about 1% on the money, but that's not why she's doing it. The key is to start saving and building up that emergency fund and then that reserve that she'll pull for the down payment from.

It's completely stable. She doesn't have to worry about the loss of principal. It's FDIC insured, and it's not in her checking account. So it's separate from her spending account, which means she's less likely to touch it. If she gets these two things going, the savings account with the emergency reserve and ultimately the down payment for the house and the $6,000 a year in the Roth IRA, she will be well on her way to having a solid financial foundation. Does that make sense? It does.

Thank you. Also, what about doing some mutual funds or something to start a bigger portfolio, or is that something that she should do later on? Well, that's what's going to be essentially in this Roth IRA. I mean, if you want her to have a separate investment account outside of the Roth because you can't get enough in there with the $6,000 limit, she could open just an individual brokerage account at Betterment or Schwab and put some additional money in there. But I'm thinking, given what she's needing in terms of buying a house someday, she probably doesn't want to put too much in investments because she may want to pull it out two years from now, and the market may be down.

And so I would just be very careful as to not over-contribute to an investment account if it's not truly long-term money. Marina, is your daughter as interested in this topic as you are interested in it for her? She says that she is. She just doesn't – she wants a little help on where to start. Gotcha. And I just wanted to give her that little – help her get that little boost because I totally want her to do all of the investigation and looking into everything on her own. I just want to give her a little direction.

All right. Well, to help you with that, we're going to send you – you stay on the line. We'll get your contact information. We must send you a complimentary copy of the book Sound Mind Investing.

And you may find this book interesting yourself, but I know your daughter will, and I trust that this will help her as she moves along with your encouragement into the future. And we're glad you called today. God bless you. Thanks so much.

Chicago, Illinois. Hello, Barb. How can we help you? Thank you so much for taking my call. I appreciate it. Sure.

Yes, I'm 61, turning 62 in September. I was part of a recent RIF at our company, and I was given – and I was VP status there. But I was given a surrendered value, a Coley, a company-owned life insurance of $40,000. Also, I had a non-qualified deferred comp plan of $40,000. So my question is, should I use that $80,000? I owe $60,000 on the house and $12,000 on the car. We have no other debt. Should I use some of that money to pay off the house or the car? Tell me about the rest of your financial life because I love the idea, Barb, of you being completely debt-free. Obviously, that's going to give you ultimate flexibility, give you some peace of mind. Obviously, it will reduce the overall monthly expenses as you no longer have these payments, which gives you more that you can plow back into savings or giving or long-term investments.

So that's great. Beyond this money that you'd be receiving, do you have an emergency fund of three to six months in savings? Do you have other retirement assets that you feel like are on track for your future? Yes, we do. We've got probably total assets right now with funds that we're not using that we've got through Goldstone Financials, our financial group that we're working with.

We've got about $1.6 million in assets. But I know that my husband's got quite a few hundred shares of Tesla and I know we're going to have to pay capital gains this year on that. So that's going to hurt us. He's 63. He'll be 64 in October.

He's probably going to work another three years or so. Yes. Okay. Well, the key with the Tesla stock is make sure you hold that at least a year if you can, which will help out a bit and give you the long-term capital gains. Obviously, that stock has done quite well over the last year. But I think given the assets that you have, given the position that you're at, assuming you and your husband have a conviction around being debt-free and that's something that would give you some peace of mind, I think there's no reason not to go ahead and just pay all this stuff off and be completely out of debt and then, again, take that excess that you have and use that for additional giving or additional savings opportunities.

But I don't see any reason why you'd want to continue to pay interest on these debts, given this money that you're going to have unexpectedly. Barb, thank you very much for calling today. We do appreciate that. You're listening to MoneyWise Live with Rob West. I'm Steve Moore. It really is a pleasure and an honor to be with you each day. If you'd like to know more about who we are, really, and what our ministry is, or if you'd like to make a donation to our ministry, you can do all that at MoneyWiseLive.org.

Just click the donate tab at the top of the page, MoneyWiseLive.org. We'll be back after this. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . have to put all of that down for a 20 percent. We're gonna do a 20 percent just on a cheaper home so that we don't have the mortgage insurance. My question would be, say for example, if we put down $60,000 out of the 71, will we be incurring capital gains on the $11,000?

Will we even be incurring capital gains at all? Does that make sense? Yeah, it sure does. This was your primary residence that you just sold Caleb, is that right? Yes sir, yep. And did you live there two out of the last five years prior to the sale?

We did. Okay, so you have a capital gains exclusion for a married couple of a half a million dollars and that's not the sale price, that's the gain. So anything you have less than that in gain of $500,000, you don't have to do anything with it. It doesn't matter, you know, whether you put it into a new home or, you know, keep it and invest it, there are no capital gains and that's as a result of the primary residence exemption there for capital gains tax. So I think what you're doing is you're thinking about an investment property and what's called the 1031 exchange where you have to take the proceeds and roll it into another like property, but that's only for investment properties with your primary residence.

As long as you meet the ownership and use test, which is that two out of the last five years as your principal residence, then you've got a half a million dollars worth of exemption. I see, okay. All right, congratulations on that. All the best in your new endeavors. Thank you so much. Have a good night. You too.

Thanks Caleb, God bless. So they moved from Colorado to Cleveland. Maybe he's a member of the Cleveland Browns football team or something.

I guess we'll never know. All right, Atlanta, Georgia. Hello, Virginia. What's your question for Rob West? Oh, hello.

Good afternoon. I am married for four years. We just have a problem. We have a joint account. I put all my salary goes to that account. My husband put all his salary in another bank account. He's a good hard worker. He's paying the car insurance for phones, electric, some bills.

I paid the health insurance, Comcast or something else. But in all these years, he really, it's hiding that he's not putting all his amount, everything he will have. We are both to the second marriage.

He doesn't have to pay any child support, anything. And when I ask why it's an, you know, in our account, but you don't put money, he said, because I'm working for that. He's working hard.

Yeah, I know he wakes up at four or five in the morning. But now I need, really, I need God's strength and advice, your advice, how to handle this in a diplomatic way. Sure. Yeah, biblically. Virginia, I appreciate so much this question. Let me just encourage you, first of all, this is more common than you might think, but it doesn't mean that it's really God's design for the marriage relationship. We know clearly from God's word to become one. And so that means God's plan and design for marriage is oneness. And that includes every area of our lives. There's not any particular area at all that we hold outside of that design that God intended for his institution of marriage. And so the question is, how do we foster that oneness in your marriage, including in the area of finances, because this really ultimately isn't a financial issue.

This is an issue about bringing you all together as husband and wife. Bottom line is none of this money is either of yours. It all belongs to God. It's all his.

He's the owner. You are the stewards, but he's made you stewards together because you've been joined together in the marriage relationship. And so now all that God has entrusted to you, regardless of how he provides it, whether it's through his employer, the government, your employer, a windfall, somebody shows up on the doorstep and turns something over to you because God prompts their heart, doesn't matter how God chooses to provide for you. The question is, as a married couple, how are you going to manage and steward and allocate God's money? And I think that's really the fundamental shift that has to take place, starting with God's design for marriage and then this game-changing idea that it's all his.

The earth is the Lord's and the cattle on a thousand hills is what we read in Scripture. So we've got to start there. And that may involve you just, well, first of all, you need to pray and ask the Lord to open his eyes to these truths as you articulate that. I think you could go a couple of directions after you pray and ask God to intervene here in ways that only he can.

Number one is you can invite him to have a conversation about that and just say, listen, acknowledge just what you said. I know how hard you work and I know that what you're doing to bring income into our family. But that doesn't change the fact that we jointly have been tasked with being stewards of God's resources, which means we need transparency.

We don't need to be hiding anything. We need to be together making decisions about how we allocate God's money. That may begin to make some progress.

And I think what you would need to ask him to do is to bring transparency to this and to put it all in that one account so that you all can make decisions together. And that doesn't mean that there couldn't be built into the budget particular funds of a certain dollar amount that allows you to each use it the way you want so that you have your own expression of how you want to use your money for things that you enjoy, hobbies and things like that. But that's the budget.

That's the spending plan. You work on it together, but it can still have a reflection of each of you in it. Now, if you don't make any progress with that, there's a couple of other directions you could go. I'd love to send you a copy of Howard Dayton's book, Money and Marriage God's Way. When you get done here today, hang on the line. We'll send you a copy.

It's our gift to you. See if he would be willing to read through that book with you. A chapter at a time where perhaps you guys take it a week at a time and read a chapter and then you come together and talk about it. See if perhaps God would use that to soften his heart. I think a third option is to bring a third party into the equation, whether it's somebody from your church or one of our MoneyWise coaches, a godly accountability third party that can walk with you and begin to articulate God's design for marriage and money and how the two of you can work more closely together. At the end of the day, it's going to be God working in his heart and your heart to bring you together and that's what we want to look for and pray for. So, I hope that's an encouragement to you. Stay the course.

Start with prayer and stay on the line and we'll get your information and get this book right out to you. Rob, would it be okay if you both agree to having separate accounts and separate finances, if you will, is it okay as long as you both agree to something like that? I don't think so Steve because it really just invites, I guess the word I'm looking for is it doesn't promote unity because now we're off doing our own thing and there's a tendency to be this is mine and this is yours and I'm doing this and I don't need to tell you because that's in my account and so I just don't really see any benefit to having separate accounts even if you agree to it. I want to do everything to foster oneness. I don't want to set up any component of this that's going to drive us away from one another and I think these separate accounts have the potential, doesn't mean they always, but they have the potential to do that. Thanks, that's good Rob.

Winter Haven, Florida. Matt, you're 24 years old and what more do we need to know about you other than that? That's about it. I'm 24. I've got just shy of $10,000 in a savings account. I've never been very good with money.

That sounds pretty good. I just throw it in there and forget about it, but I want to move out. I live with my parents still. I've kind of been aggressively trying to save towards getting my own place and I'm just wondering what do you guys think would be a good next move for me investment wise? I've never invested a dollar other than whatever I put in my savings. Sure.

Well, good news is you're young. You've already made some good decisions in terms of keeping your expenses low, which has allowed you to live in your parents' home to do that, and you've saved some money. So I think we've got some objectives that I think we want to really pursue. Number one is if you're not giving, I would start giving. Make that your first financial priority to give as God has prospered you. The second thing you want to do is set up that emergency fund.

We're looking for three to six months expenses. Put that in a savings account, Matt, even though it's not earning a lot of interest, it's there for the unexpected. The next thing you want to do is max out your 401k or 403b to take advantage of the match.

That's free money. And after that, if you have any debt, we want to attack that next. All debt except the mortgage. Once you do that, we want to try to get the retirement contributions up to 15 percent of your gross income. And then once we get past that one, then we're starting to look for other savings goals, maybe a down payment on a house, look for additional giving opportunities and any other objectives you have down the road. So hopefully that gives you some clarity on where you're going from here. But congratulations on having a really good start. Yeah, Matt, I'll tell you what, you might want to visit our website moneywiselive.org. Scroll to the bottom of that page and you'll see an area that says resources. There are a lot of free resources there that will help you get started on putting together a spending plan or a budget, some biblical principles that apply. All that I think will help you get on your feet financially and maybe get out of your parents' house. They might want to turn your room into an audio visual extravaganza.

Who knows? But we wish you the best. Thanks very much.

MoneyWise Live is a partnership between Moody Radio and MoneyWise Media. Thanks for listening. Tell a friend, drive safely. Join us again next time.