Do You Need a Financial Advisor?

Proverbs 19-20 says, listen to advice and accept instruction that you may gain wisdom in the future. And perhaps nowhere is sound advice more important than in managing your money. Your car needs repair, you take it to a mechanic.

A health problem, you visit the doctor. But what's the best approach that you should take with money? Well, today host Rob West sits down with Kingdom Advisors founder Ron Blue to answer the question, do you need a financial advisor?

I'm Steve Moore. This is MoneyWise Live. Rob, our guest Ron Blue has written over 20 books on biblical financial principles.

And today we're looking at a section of Master Your Money, a step-by-step plan for experiencing financial contentment. Well, that's right, Steve. And it's certainly one of our favorites. Ron, delighted to have you back on the program. It's always fun. Thanks for having me.

Absolutely. You've had decades of experience teaching people to manage their money God's way. But your career in finance, I know didn't start out that way. So why don't you start by just giving us a bit of perspective and the backstory on how this all became what you call a kingdom mission for you? We don't have time. Maybe the short story.

The short version. It was actually 53 years ago. I graduated from Indiana University with an MBA degree and I had my CPA. And I went to work on Wall Street and I spent three years with, at that time, it was called Pete Marwick Mitchell today it's KPMG. At that time, the world's largest accounting firm. I spent three years there and then decided to start my own accounting practice back in Indiana, which is where I had come from. And went back and I'd finished second on the CPA exam when I took it. And so I hired the guy who finished one. So they'd have somebody do the work. My avocation has always been marketing and not work.

I love it. But I spent seven years and as I looked back over that seven years, this was precomputers. And I sat across the desk from hundreds of entrepreneurs and professional people and gave them counsel primarily in the tax area. But I had a lot of experience in counseling people. So now this is all look back.

I didn't realize at the time what was going on. But what God did was by starting on Wall Street, he gave me some credibility. And then seven years of counseling people. He gave me some experience not only in counseling, but how to build a business that was time based rather than product based.

Yes. And then I spent two years, I decided to leave the CPA world and I spent two years. I traveled to Africa, made 11 trips over there and saw the third world, which gave me a perspective, because when you deal with the wealth in America and then you look at the third world, you see things differently. And Dr. Howard Hendricks, who was my mentor, asked me to take a look at his financial situation, which I did and was able to say to Howie and Gene, you know what, you're doing just fine. And now I look back on that and I know that everybody wants to know the answer to the question, how am I doing? Yeah.

And no matter who it is, I want to know how I'm doing. Yeah. So I started a what later became a financial planning firm and I charged for my time rather than selling any products. And the first client that paid me a fee, I helped him develop a plan to give away a million dollars over five years.

Now, that was when I looked back and this has all happened in the last year. I did a look back and I realized that if that client had only given a hundred thousand, my bar would have been a hundred thousand. But because that couple gave a million dollars after that, I didn't have any trouble helping people think about how much they could really give millions. So my mission was to help Christians specific to the Christian world, plan to manage their money for one reason. And that was so they'd have more money to give away.

And you've been on that journey ever since. And if I remember the story correctly, Ron, that client, that first client that gave away a million dollars was not someone that was ultra high net worth. No. In fact, when I talked to him, I said, what's your income? And he said, eighty two thousand a year. And I said, what do you have in the way of assets?

And he said, oh, I don't know, three or four hundred thousand, I suppose. Incredible. Yeah. Well, I know you've been purposed to live out that mission ever since to help Christians plan and manage their finances, to have more to give away. And that's really fueled everything you've done professionally. So we'll talk more about that right around the corner.

That's right. This is Money Wise Live. Your host is Rob West, our special guest today, Ron Blue.

And we'll be right back with more. Having a home is the largest, most nerve wracking purchase most of us ever make. It doesn't help that you're entering a maze of unfamiliar words and confusing options that can leave you intimidated, frustrated and afraid you've been taken advantage of. Navigating the mortgage maze by Dale Vermillion helps you clear up the confusion, unrack your nerves and make the best mortgage decisions possible with confidence. Navigating the mortgage maze 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. Sound Mind 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.

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That's Christiancreditcounselors.org, or call 800-557-1985. Great to have you with us today. Your host is Rob West. I'm Steve Moore, and today we're chatting with author, teacher Ron Blue, answering the questions, how am I doing and do you need a financial advisor? You know, Ron, this is so important because just before the break, you were talking about really the journey God took you on to develop the kingdom mission that you had for the work that you do. And I think this really highlights at its core the difference between a financial advisor and a Christian financial advisor. And I'd love for you to talk about that because as you built your firm, you saw God's word proved out at a professional level in terms of financial decision making, didn't you? Yes, I really did. You know, I had the professional experience. And then when I started helping people plan, I realized that everything that worked on Wall Street had its roots in scripture.

Now they didn't know that, of course. But God's word speaks to every financial—I believe God's word speaks to every financial decision that anybody will make at any time under any set of circumstances. That's a strong statement.

Yes, it is. I said that to a pastor one time, and he said, well, then why isn't the church the purview of finance? That's a good question.

It is a good question. And you know, God's word works in every area of life. So there's no area of life that he doesn't talk to. But money was the one that the Bible talked to the most. Howard Dayton said that there are 2350 verses that deal with money. And what I found over the 50 years or 40 some years that I've been helping Christians is that God's word speaks to every situation, but it speaks in a very understandable way. I played golf yesterday with someone who is not a believer. And he quoted a Bible verse to me, render unto Caesar what is Caesar's.

When he found out what I did, he quoted that verse. Well, there is a principle right there that governs how I think about taxes and handle taxes. So God's word is simple, but it's also relevant.

That's why I say it'll work at all times under any set of circumstances. It doesn't change whether I have a hundred thousand dollars or a billion dollars, or if I have nothing and am trying to get out of debt and trying to get my feet on the ground, it's still the same principles. So it's simple, it's relevant, and it's highly replicable.

It's easy to explain it to somebody else. And if I could say one thing that crossed my mind when you were just talking, Rob, in terms of why do you need a financial advisor? I have a financial advisor. And I've written a bunch of books on money. So he doesn't tell me anything I don't know about money. But what he does do is he keeps me accountable. And number two, the first person that my wife would call upon my death would probably be Ken.

Yes. Because he he knows the whole situation. And it gives her a piece of heart and mind to have somebody that can help her out that has no bias, if you will, except to help her. Well, that's a really key point.

Because as you all meet in whatever frequency you meet quarterly or semiannually, he can ask the questions to her and you that perhaps you all wouldn't unpack otherwise. And he'll challenge things. We made a decision to give away our retirement a number of years ago. Now, it's a pretty big decision.

Yes, it is. And we sat down with Ken and we said, Ken, we don't believe that we're getting older. Our kids are doing OK. And we've got income that's coming in. We don't need this chunk of money that's sitting over there in a retirement plan that we're going to give it away. And it was a lot of money, a lot of money for us.

It wasn't a lot of money for a lot of people. But but he really challenges on that. Do you realize what you're doing?

Do you realize the consequences of that? And those were the right questions. And to have somebody independent ask and be able to answer and for him to say, OK, I think you thought it through.

Yeah. So having a financial advisor is really important. Well, if Ron Blue needs a financial advisor, I would say everyone needs a financial advisor. Ron, talk about the difference between a financial advisor and a Christian financial advisor.

How would you characterize that? Boy, boy, I've really learned something, Rob. In the last 15 years when we've been building kingdom advisors, I've spent all thousands and thousands of advisors that I've talked to and all of them are Christian. But when you talk about giving your advice from a biblical perspective and your clients knowing that, all of a sudden you separate the sheep from the goats.

And there's a huge difference. I can be a Christian and run my business with integrity and in every way demonstrate a Christian life. But that's my life. And can I run my business so that the advice that I'm giving is biblical advice? Now, the reality is it probably will be the same advice, but now I know where it came from. And so when somebody makes a commitment to become a Christian financial advisor, it changes the way they think and it changes their advice and how they give their advice. Well, Ron, we often get calls from listeners saying, what should I look for when I'm interviewing a financial advisor?

And are there any questions I should be asking? So apart from looking for somebody who's been trained to bring biblically wise financial advice, and I know you would agree that the certified kingdom advisor designation is really the gold standard for that. What should someone look for when interviewing? Well, I think having a conversation and becoming convinced in that conversation that this advisor wants more than anything else to help you identify your goals, your values and your priorities, and then design his advice or her advice around that.

Yes. So in interviewing a financial advisor, I'd be real interested in what questions they ask me. Because if they ask me so many questions about investments or taxes, those are legitimate. But I'd be more interested in an advisor that asks me questions like, how are you thinking about your giving? What relevance does that have to your financial thinking? How do the two of you communicate when it comes to money? If you're sitting down with a couple, and you should be, always, because this is an area of terrific conflict.

And it's conflict because if you take two people who have been raised differently, certainly, put them into one checkbook, you're bound to have conflict in the sense of not always agreeing on something. So I would look, I would want to know who they've worked with. I would want some references, a couple of references from who they worked with. But I'd want reference, I'd ask them for somebody that was like me, in terms of a reference, perhaps my age, perhaps my spiritual level of commitment. And certainly the wealth that I'd have or don't have.

We have just a few seconds left. Unfortunately, I'd love to unpack this much, much further. But I know you have often said you would pray James 1-5 before you walked into every meeting. And so really, it's about an advisor who's going to bring God's wisdom, isn't it? It really is. And that's a good question, too.

I would ask, how much time are you spending on the Word? I believe James 1-5 is the best financial planning verse in the Bible. Ryan Blue has been our guest today. You can find his book, Master Your Money, at MoneyWiseLive.org. You can also get in touch with a certified Kingdom advisor from there. Just click the Find a CKA button. Your call is next, 800-525-7000.

800-525-7000. MoneyWise Live. We'll be right back. Have you ever taken a wrong turn when it comes to money?

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Your free e-magazine subscription is waiting for you right now at MoneyWise.org slash sign up. 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. After all that he's done, when the enemy sees that that's the season we're going through, and that's the question on our mind, he sees that as a drop of the shield, and he knows, come in, come in, because their guard is down. James chapter 1 tells us, don't be like a man, and I'm paraphrasing here, that doubts is tossed to and fro. Believe what God says. We're told then, and I'm just presenting this idea to you, consider this point, our uncertainty about God flies like a flag over our heads saying we're vulnerable. And we may be uncertain about ourselves and all sorts of other things, but we can believe that God is who he says he is and that God can do what he says he can do. Even if we, we don't want to get into a place where we're telling him what he's going to do, but we can know without a shadow of a doubt, I know my God can. And I'm going to stand on that because when we're inundated with uncertainty about him after all he's done, and after him being there over and over and demonstrating his power in our personal lives, the enemy sees that as guard down and then came Amalek. I wonder as you think that through when your last invitation to the enemy to come in was. I don't mean to come in our person. I mean to just come in our midst with oppression because I'm telling you, I can look back on that and that can make so much sense to me. Watch for that guard to be down.

Watch for when we drop that shield because boy, does the enemy take that as a waving red flag. You've been listening to Beth Moore with today's quick word. Beth is dedicated to encourage people to come to know and love Jesus Christ through the study of scripture. Why wait?

Click online today. Pick a podcast or television teaching or both. Just visit Beth Moore.org. 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. Hey, super to have you with us today. He's Rob West. I'm Steve Moore and it's always a great pleasure when we have Ron Blue here. We learn all sorts of stuff. We think we know a lot about the Bible and money and finance and then Ron shows up and springs a lot of stuff on us. Maybe some of it we've heard before, but the way he understands it, the way he's able to teach it and explain it, it's just always a blessing to have him in the studio with us.

Well, it sure is. He's a blessing to me. He's been a mentor for a long time, but you're right, Steve. He takes these principles and makes them so profoundly simple and it's not prescriptive. He gives it to you in a way where you can apply it over and over again to your situation. So it's always a joy to have him stop by.

That's for sure. And it's a joy to talk to you, but you will have to place that phone call first. Now we have some open lines. We actually have about five open lines and that means there's plenty of room and space for you to call in today. Right now, 800-525-7000, whatever you might be wondering about thinking about going through anything financial. Why not give us a call? Let's kick it around.

Let's see what God's word has to say about it. Again, our toll-free number is 800-525-7000. Now, in addition to calling, you can always send Rob a brief email. The address is questions at moneywise.org, questions at moneywise.org. We happen to have one here from Linda.

We have a couple actually. This one's from Linda, Rob. It says, my mom has a couple of small insurance policies that my dad took out on her years ago. They are more than paid for, but she still has to pay monthly. Should she just cash them in? What kind of penalties might there be?

Yeah. You know, we see this often with a whole life policy where there's a very small death benefit where it was taken out probably as a savings vehicle more than anything. Although, obviously the small death benefit is a factor, but if she's had these for years and years, there probably is no penalty at this point.

You always want to ask that question, but usually those surrender charges go away over a period of time. The question is, is this life insurance actually serving a purpose? Is it necessary at this point, both in the amount of the death benefit and just in terms of what life insurance is needed? Because perhaps you have other coverage with other policies or they're in a retirement season and they have all the assets they need. So if something were to happen to your mom or your dad or vice versa, the other person would not be dependent upon that person's income, for instance, because there are retirement assets that are providing there. So if that's the case, either it's a duplication of an existing policy or they just simply don't need life insurance in this stage of life, then I would absolutely make that call, confirm that there are no penalties. And at that point they could just ask for a withdrawal of the cash value that they could redirect for other purposes, savings or giving, whatever it might be.

And then they would just close out those policies. Okay, good. Here's another from Arnie. He says, Dear Rob and Steve, is it okay to give to two well established nonprofit organizations who are not necessarily Christian organizations? Yeah, it's a great question. And you know, I think we always need to give consideration to how we're giving and where. You know, it starts with a recognition that God owns it all and we should be effective and faithful stewards of God's money. And I think part of that faithful stewardship, Steve, includes our generosity, our giving. We need to hold God's resources with an open hand and we need to organize our financial life in such a way that we have margins so we can give.

We should give up front systematically. But then I think over time we want to try to increase that with even more sacrificial giving. Now, once we experience the joy of giving and we reorder our finances so we can do even more giving over time, then we all are faced with that question, where should we give? And I think we've got to start with a connection between what's on the heart of God with what passions we have and who's doing effective work. And so when we look at the heart of God, we see the ministry of God's word, the ministry of God's mercy, and the ministry of God's justice.

And we've actually got the scriptures that go with each of those categories as well as examples on our website. If you want to check that out, it's MoneyWiseLive.org and just click on the giving worksheet. But there's no reason why you can't give to other things that are doing other types of good, either in your community, having a social impact.

But I would just say pray through it and see where God directs you and then give generously. I like it. Thank you, Rob. All right, again, our phone number, if you're just tuning in and you'd like to call in, dial 800-525-7000.

Anything financial is fair game today. Let's begin by going to Cleveland, Ohio. Our good friends at WCRF up there and Diane, what's on your mind? Hi, thank you for taking my call. I love listening to you guys.

I get a lot of good knowledge and understanding from it. My question is, my husband and I are in our early 70s and we'll probably be moving out of our home that we've lived in for 40 years. I don't know, within some five years or so, we're not going to move right away. But my question is, how should we fix up our house in order to sell it at this point? I mean, is it really worth to redo our kitchen?

It's a great question. Well, let me weigh in on that, Diane, because I like the fact that you're thinking that way, because that's the way you should be approaching it. Not everything you could do to your home is actually worth doing if you're preparing to sell it.

Because remember, you wouldn't be doing these things simply because you want to enjoy them. You would be doing them to maximize the value of the sale of the property. So the starting point, I think, would be to get a professional realtor in there who could give you some advice as you even prepare to sell on what should be done and what shouldn't. Just generally speaking, you want to look at things like adding a fresh coat of paint to sell your home, especially if you have some rooms with loud colors.

Perhaps update your front door. Herb appeal is big. Bathroom remodels, no matter how small, are effective. Decluttering your home is always helpful to attract buyers. Making it more energy efficient is a good thing. And then looking at flooring and landscaping options. Those are the things that are going to give you the best bang for your buck. I wouldn't launch into something major like a kitchen redo or remodel because they're so expensive, you're just not going to get the money back. But check in with a realtor who specializes in your neighborhood. Look for the signs and have them weigh in on this as well. Diane, we're glad you called.

Thank you very much. Loud colors, that's somewhat subjective. Purple and pink. What do you think, Rob? Yeah, no, I'd go neutral. We'll be right back. This is Money Wise Live. Investing is more than just returns.

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Interested? Learn more by calling 800-791-6225 or online at chministries.org. Hi, my name is Elizabeth, a communications major at the Moody Bible Institute. The Moody Radio Verse of the Week is found in Matthew 4-16. The people dwelling in darkness have seen a great light, and for those dwelling in the region and shadow of death, on them a light has dawned. That's Matthew 4-16, the Moody Radio Verse of the Week. You may know that you're loved by family, friends, by God, but do you really feel it? Dr. Gary Chapman and York Moore have teamed up to write Seen, Known, Loved, Five Truths About God in Your Love Language. In it, you'll learn how to know your own love language and how God uses it to communicate with you personally. Learn how God is intimately involved in your life in beautiful and unexpected ways.

Purchase your copy of Seen, Known, Loved at moodypublishers.com. 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. Senate Majority Leader Mitch McConnell is calling for a new vote, in his words, every legal vote to be counted. President Trump raising concern about election officials in Philadelphia accepting mail-in ballots without the proper postmark, even duplicating some ballots. The counting continuing in four key battleground states.

In Georgia, Pennsylvania, and Nevada, Democrat Joe Biden has pulled into the lead, but President Trump says he's not giving up the legal battle. If you're in South Florida, be alert. Forecasters say the storm called Eta is back over the Caribbean, where it's expected to strengthen into a tropical storm once again. It's expected to bring soaking rains, high winds, and heavy surf to Florida by early next week.

On Wall Street, stocks finishing mixed, the Dow fell 66, the NASDAQ gained four, and the S&P 500 dropped one point. This is SRN News. Welcome back to MoneyWise Live, where we remember that God owns it all. That's a great starting point. And if we can help you today with a financial situation you might be wondering about or dealing with, maybe it has to do with buying a home or a car or maybe giving a child an allowance or getting them through college. Let's talk about those things, 800-525-7000. Daniel, what's on your mind, sir? Good afternoon. Thanks for taking my call.

Happy to. My wife and I are debt-free and we are both a couple of years away from retirement age. I plan on working a little beyond that because we don't have a large nest egg. So my question is, is there one resource or source to go to for short-term retirement advice? Yeah, and Daniel, you're specifically asking how to prepare for the financial side or are you also wanting to think about and consider the non-financial side of navigating that season of life? What specifically are you trying to get at?

Well, when we've looked at different resources such as, you know, the Schwab or others like that, there's just too much information out there and it's kind of overwhelming. Yeah, yeah. So yeah, the financial side.

Sure, sure. Do you all have a financial advisor, Daniel? A few years ago, we approached one concerned about market conditions and wanted to lower our risk and didn't know anything, you know, at that time and found out later what he sold us was an annuity. I did contact the CKA recently. Very, very polite and helpful, but he could not answer the question and he told us basically that the amount that we had was really below his entry level.

Okay. Yeah, and keep in mind with the CKA designation, you know, there's all types of business models behind that. So when someone earns the designation, in some cases they specialize in working with high net worth, others will work with massive fluent, others, you know, have a much lower threshold. So it's really going to run the gamut. So I'd encourage you perhaps to reach out to a couple of others in Indianapolis to find someone who perhaps could work with you at your asset level.

But I think the bottom line is you're right. You know, there's often a gap of information out there as to prepare. I think the considerations you need to be really focused on right now are what is it going to take to fund your lifestyle in that season of life? You know, when you are fully retired, either because you stopped working because you just can't manage a full time scheduling longer or God redirects you to something else. What is your expenses going to look like? What are your expenses going to look like?

I'm delighted to hear that you're debt free. Obviously, we want you to approach this season of life in that position because that's going to keep your expenses as low as possible. But having an accurate picture of what that budget will look like is really the starting point because then we need to back into what are the assets needed to support that. When you consider social security, perhaps for you and your wife, you look at the various retirement assets that you've built up, any annuities that are available that could be converted to an income stream or a pension.

And then you would want to look at perhaps a rule of thumb, saying for those retirement assets, where you know, you've accumulated some wealth, like a 401k or an IRA, you'd probably want to use either four or 5% as the percent that you would draw out of that every year to add to other guaranteed income sources like retirement, and look at how that would relate to the budget that you have. That's going to give you just a starting point to say, are we on track? Are we ahead?

Or perhaps are we behind? And obviously, your ability to continue to work to build those assets, if that's not going to throw off the kind of income you need, that would cover the full expenses that you plan to have, you know, continuing to work is going to give you a chance to see that continue to rise. So I think that's kind of the starting point. But the benefit of having a financial advisor, either to do a retirement plan, separate from investment management, or to have someone who also will manage these assets when you reach that point, I think is really key, Daniel, because that financial professional can help you look at not only your income needs, and how you would convert retirement savings to income, but also what other considerations do you need to look at long term care insurance?

Will that fit in the budget? You know, what other considerations do you need to look at in terms of risk and insurance and so forth? And that type of planning, I think will go a long way. So anyway, hopefully that will give you some food for thought there.

And I might consider, you know, again, reaching out to some others to see if you can find somebody who has a business model that fits the the investable assets that you have. Thank you, Daniel. Hope that helps you win a muck in Nevada.

Jeff, thanks for holding sir. And what's on your mind? Well, I appreciate the opportunity to talk to you guys. I heard part of this some time ago, which caused me to think I should get more information. The question is, is there a point in your life when you just need to stop paying for life insurance? Yeah, yeah, yeah.

Well, absolutely. You know, keep in mind, you know, there's life insurance as pure insurance. And we would call that level term insurance where you're just paying for purely the mortality expense for the death benefit that you have to offset a risk during a period of time where you're typically working and trying to build assets, you know, prior to retirement. And then there's insurance that is a death benefit plus a savings vehicle, we would typically call that whole life insurance.

And it has a few other varieties and names that you might hear it referred to. But when it comes to just the need for a death benefit, in my view, the idea is we carry that insurance, that life insurance, during the season of life while we're still building wealth. And what that's going to do is for any dependents like a spouse or small children or even a older child who's still dependent upon you for whatever reason, you know, that life insurance is going to provide needed assets to them upon your death because they're either going to be without income that you were earning or they're going to have added burdens in the way of expense or they need to pay off debt or cover a major near term expense like college education. That's the need for insurance.

But when we get to that season of life where we're transitioning out of the workforce, God is redirecting us toward our next assignment. We've built our retirement assets. We're collecting Social Security. And if something were to happen to you or your wife, the other person has what they need to continue to provide for their needs. And your children, if you have children are grown and out on their own, then there's really not a need to carry life insurance at that point, which, by the way, is going to get more and more expensive in that season of life.

And so we would drop it and let it go. This idea that we need to have life insurance throughout the whole of our life, I think, is a misconception because the whole idea is to get to the place where we no longer need it. We're essentially self-insured. Does that make sense, though, Jeff?

Yes, I appreciate that. If I am retired, but if I go, but I'm considering going back to work, but I guess at this stage of life, it probably doesn't really make that much difference as long as my wife is able to pay for something happens to me, then I'm guessing it doesn't. It's not getting any more expensive. It's stayed stagnant so far. It's a term insurance policy.

I've had it for as long as I can remember. Yeah. Well, and I think the key there is just to say, if something were to happen to you and you didn't have that insurance, would she be able to provide for herself with the assets that you have and the other income sources? If yes, then it's really not a necessary expense.

If not, then considering there's still time on the level term, I'd continue with it. Jeff, great question. Thanks so much. God bless you.

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It's Money Wise Live. I like to say it's where your checkbook and God's book meet to have an impact on your life and the lives of those around you. I like to say that, where your checkbook and God's book meet.

It's got a little kind of a vibe to it. It's creative, I think, but it doesn't work in your case, Ralph, because you don't have a checkbook, do you? No, no, I don't.

I could probably find one in a drawer somewhere at home, I would suspect. But I mean a checkbook, you know, a leather bound book with checks, geese flying in the background. I mean, you don't write those, do you? No, no. And I know I've never had any geese on my checks either.

I can imagine that would be beautiful though. You're suggesting I'm old school, aren't you? I didn't say that, you did. Well, I'm going to say this, West Palm Beach, Florida, how do you like that? Rebecca, thanks so much for holding and what's your question? My question is about renting versus buying. My husband and I, we've been renting for a few years and our rent has gone up to the point of it's almost as much as a house payment, including, you know, taxes, insurance, HOA and all of that. We're in a position where we could possibly buy. We have 10 percent to put down plus money for closing costs. It would still leave us with about two months in our emergency funds. But we are just not sure what to do as the housing prices have significantly gone up in the past, you know, eight months or so here. We've got pre-approved at three percent. We're just not quite sure what to do.

Yeah. Well, Rebecca, I can certainly appreciate where you're coming from, because I can imagine it's frustrating to pay all that money toward rent every month and know that you're not building any equity. Although I will say that not only do we not want to put ourselves in a position where we get overextended by taking on a huge mortgage that we're not equipped to pay or we've not saved enough.

I also want you to consider just the added expense that goes with home ownership. You know, we just had a tropical storm come through Atlanta here. And, you know, I've got facing all kinds of expenses related to the cleanup and the, you know, the damage that, you know, so many experienced in this area and in various parts of the country.

People are dealing with other issues, hurricanes and fires and all of those things. Now, we have insurance for that, but it doesn't mean that there's not expense with deductibles and just other maintenance and upkeep items that we have on a home that perhaps we don't always have when we're renting. So we've got to count the costs both in terms of are we financially ready to take on a major obligation like a home mortgage? And I think we would measure that by the down payment as well as making sure that the resulting payment from whatever mortgage you take on fits within the budget.

And we could talk about some guidelines on that in a second. So there's the financial readiness part in terms of the purchase. And then secondly, would be counting the cost to make sure you're factoring in the other costs that just come along with home ownership and you're not discounting the reality of those. Let's go back to the financial readiness for a second. We would typically say, I'd like for you to have 20 percent down instead of 10.

Why is that? Well, that's going to put you in a position where you've got a good bit of equity starting out. Number one, we have had a big run up in housing prices. So if we were to have a dip, it's going to keep you out of a position where you might be upside down and therefore unable to sell the home. Number two, it's going to prevent you from having to pay costly private mortgage insurance, which does nothing for you. It's only for the benefit of the lender. And number three, it's going to keep that mortgage down a little bit lower, which is going to help with the resulting monthly payment. Now, does that mean I would never buy with a 10 percent down payment? I would just say I'd prefer it to be 20, which would mean you'd have to delay this purchase until you continue to save.

But at the end of the day, that's up to you. In terms of the payment, I would just go back to that budget. You're already paying a rent payment. I assume you've calculated what the equivalent mortgage payment would be. As a rule of thumb, I'd like that to be 25 percent or less of your take home pay for the principal interest taxes and insurance payment.

So given all of those considerations, Rebecca, tell me your thoughts on how you're processing this. Yes, that's pretty much what we were we were thinking. Our concern is being able to get another 10 percent saved and how long that would take us. That could be, you know, five, six more or seven more years, maybe before we can save that money. And then we're paying, you know, twenty three, twenty four hundred dollars a month in rent for the next five, seven years. It's like, should we we're still able to say save even if we bought and put money away towards maybe like two or three hundred dollars a month away towards monthly home maintenance. So I'm just I'm we're just not sure what to do. I'm afraid that we may just be priced out of the market. Yes.

Yeah. No, it makes sense. I think I like what I'm hearing in the sense that you're still going to have your emergency savings, perhaps at the very least, continue to save such that you could put down that full 10 percent and still have at least three months expenses in reserves. I like the fact that you have a couple of hundred a month that you could put toward home maintenance. Usually we'd say think in terms of one percent a year of the home's value. So if it was, you know, two hundred thousand dollar home, you'd want to have at least two thousand a year going into reserves for home maintenance specifically. It sounds like you probably can pull that off.

So just know that you're perhaps going in a little premature. But I realize you live in a very expensive part of the country there in South Florida. Real estate is very high, not probably getting any cheaper anytime soon. And so as long as you count the cost and realize what the PMI is going to add and what you're going to need to do in terms of home maintenance and you actually do it, then I think, you know, it's something you and your husband need to prayerfully consider. And if you all were to decide, you know what, we want to go ahead, even though we're going in with 10 percent down instead of 20, I would say, you know, I can't find anything terribly wrong with that as long as you go in with your eyes wide open. And Rob, we can sympathize with Rebecca and anyone else who lives in particularly expensive areas of the country.

West Palm Beach would be one, Los Angeles, another San Francisco, another parts of Long Island, New York City. But the math doesn't change. I mean, the basic math of having enough in savings, having enough down payment just in case. I mean, it doesn't mean that God won't bless other choices and decisions. But having done what we're doing here for the last 35 years, we we see a trend. And we also know what God's word says about taking on too much debt.

Well, that's exactly right. Now, there's nothing magical about 20 percent versus 10 other than the added PMI cost and just having a little bit more cushion. So I would say again, if you've gone in, you've looked at the numbers, you've carefully considered your budget, you look at all of these factors and you say, we just can't stomach twenty three hundred a month to rent any longer. I get that. And I would just say, make sure you pray through it.

And as long as you and your husband are in complete agreement, then I think you proceed. All right. We have an open line or two for a quick call. Eight hundred five to five seven thousand. If that describes your question, call right now. Eight hundred five to five. Seven thousand Sunrise, Florida. The name. And how can we help you?

Hi, I'm good afternoon. Yes, I'm wondering. My husband has is 59 years old, two days ago, and he was offered a retirement, early retirement, and the retirement will pay him his base salary for about 14 months. And they will also pay for his health insurance until he's 65, up to seven hundred and fifty dollars a month. And so we were wondering if we were planning any way to move at some point in time within the next few years. And so what we would like to do if he does take this is to sell our home and to move into an area where it will be less expensive. And so we were wondering if that is a good deal or we should just wait until he's 62.

Yeah. You know, I think this is something you just need to look at, kind of what your plans are moving forward. And I appreciate what you've even described about your plans to move. And I think clearly this is a great opportunity for you, given that you'd have these 14 months. You were already planning on perhaps thinking about a change.

God's redirecting you somewhere else. So given that, it sounds like it could be a real blessing. I think you just want to think beyond those 14 months and think, you know, at that point, are we going to have the retirement assets plus Social Security when that time comes to cover our expenses or is he going to need to go back to work?

And are you going to regret giving this up or is that in line with when you would have wanted to move anyway? And so then this is just a real benefit that you get these 14 months where he can either go to work somewhere else or use that just to allow God to put some margin in his life to redirect him to some other things. So I think we've got to look both at the financial side in terms of what are we going to do beyond this early retirement period and the non-financial side. What is it that God is calling you all to now and in the future, both in terms of time and location?

But I don't see anything wrong with this, Deneen, as long as you really are thinking through what happens financially when you get beyond these 14 months. Okay. I mean, that's what the fact that you were talking about God and his will for our life.

That is a big consideration. And we do feel that God is leading us in another direction. So it's confirmation. Good. Awesome. Well, hey, I appreciate you listening and calling.

We'll ask the Lord to give you some wisdom here as you make this decision. We will indeed. Harriet, thank you for calling in.

We have like 40 seconds here. So what's your question? Okay. Social security disability question. If I get on disability and the government changes and they decide to cut social security benefits, will they cut my benefits or will I be grandfathered in and get the same benefits regardless? Yeah. You know, we typically would not see a reduction in social security benefits, even with deflation from one year to the next. So obviously any policymaker can make any decision as long as they have enough support for it. But Harriet, I wouldn't be terribly concerned about the scenario you're describing.

I think the changes we're going to see down the road are going to be much further down the road in terms of reducing entitlements to be able to shore up the social security program. Harriet, we're glad you called. I wouldn't worry too much about this concern, but thank you for calling in today. For Rob West, I'm Steve Moore. MoneyWise Live is a partnership between Moody Radio and MoneyWise Media.