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Interest Rates Rise

MoneyWise / Rob West and Steve Moore
The Truth Network Radio
March 15, 2021 8:03 am

Interest Rates Rise

MoneyWise / Rob West and Steve Moore

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March 15, 2021 8:03 am

We knew interest rates couldn’t remain at historic lows forever and now they’re showing the first signs of rising. A growing economy and government spending are starting to have an impact on inflation. So, what does that mean for your finances? On the next MoneyWise Live, hosts Rob West and Steve Moore sit down with investing expert, Mark Biller, to find out. Then Rob and Steve take your calls and questions on the financial matters you’d like to discuss. Rising interest rates on the next MoneyWise Live at 4pm Eastern/3pm Central on Moody Radio. 

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This is Doug Hastings, VP of Moody radio and were thankful for support from our listeners, and businesses like United faith mortgage. My grandma loves Ice-T it surfing so I go to hang the grandma for a bit and I see she's holding her big plastic cup with her T the cup is literally sitting inside one of grandpa's sports socks. I'm not making this up. No one can make this up grandma you okay of course dear the socks soaks up the sweat and keeps the tea colder.

Hey, it's Ryan from United faith mortgage and as I thought about it later. I thought that's the kind of mortgage team.

I want us to be the kind that's willing to take any step needed to get the job done on your new home purchase, refinance, or cash out refinance and can we help everyone know, obviously we can't know were willing to use grandpa sock to keep a drink called you know were willing to do whatever it takes to make sure you're taking care of.

We are United faith mortgage not a faith mortgage is a DBA of United mortgage Corp. 25 Millville Park Rd., Millville, NY license mortgage banker for all licensing information, go to NML as consumer access.org corporate MLS number 1330. Equal housing lender not licensed in Alaska, Hawaii, Georgia, Massachusetts, North Dakota, South Dakota and Utah and we knew it was coming.

Interest rates really couldn't remain at historic lows forever and now they're showing the first signs of rising growing economy and government spending are starting to have an inflation. What exactly does that mean your finances is Rob West sits down with investing expert Mark Miller today to find out that your calls on anything financial 800-525-7000 800-525-7000 four interest rates on the rise, that's not right here is Rob girlfriend Mark Miller is the executive editor at sound mind investing where they been watching the recent rise in interest rates and it looks like he has something to report that he does Steve champing at the bit as we like to say Margaret to have you back on the program. Thanks Rob good backward while were thrilled to have you and this is a topic. Obviously, that a lot of folks are very interested in, especially if they find themselves in that season of life or the relying on income and of course we knew that interest rates had to rise eventually. So tell us where we are and even how we got here. Sure so we have to go back years ago when the economy really went into the tailspin back in February and March due to COBIT and the lockdown and the Federal Reserve responded to that, the way they really respond to every crisis pay cut their short-term interest rates down near zero. They started buying all kinds of different kinds of bonds to try and keep the lending markets functioning smoothly and generally speaking, anytime the economy is very weak, like it was a year ago. Interest rates can be very low without that causing any kind of inflation risk just isn't that much economic activity going on but when we fast-forward six months or so from there may be several more months out. Certainly into November and the end of the year we had a couple of significant changes. First, we started getting the positive vaccine news in November and once that hit the stage and people really could start to see that maybe we actually were going to get out of this lockdown economy a little quicker than than anticipated. That really changed expectations about higher economic growth coming back sooner and then right on the heels of that, we had the election results where the Democrats were put in a position where they could expand borrowing and spending policies that they had been advocating and the combination of those two things really shifted expectations pretty pretty suddenly pretty sharply to I will say we went from having these this lockdown economy to almost overnight, so to speak.

We have this expectation that maybe by spring or summer things would be opening up. Plus we were going to have all this additional stimulus in the pipeline. While the bond market woke up really quickly and started paying attention and longer-term interest rates started rising very quickly. They had been as low as almost about half a percent. Half of 1% is late August and they hit 1% at year end.

There up over 1.6% today. So in about three months time.

We've moved about three quarters of a percent, which is a really big move in interest rates. Yeah a very significant market you talk about the fact that Gil on one hand, this rise in rates is partly healthy. On the other hand, partly unhealthy explained that for listeners sure.

So on the healthy side you know this this rise in rates is good because it reflects this much more robust economic activity when the economy was really sick a year ago.

That's why we have these really low interest rates, but on the unhealthy side, of course, there are limits to what we say there are limits to how much government can we we know more than they borrow, the more pressure that puts on interest rates because it's like any supply demand dynamic, you increase the supply of all this new debt and the price is going to go down anytime bond prices are going down the yields are going up so that that's really the gist of it and it's not just the absolute levels of interest rates with how quickly they've been moving interesting well a lot more to come. In this mark.

We also want to know how this is can affect the stock market in the bond market that is much more around the corner, listening to moneywise live, your host is Rob West. More Mark Miller. I guess today sound mind investing. Some with us today moneywise live with Ron was born is a moment ago. Mark Miller is with us today.

He's a good friend in the works with all the great people@soundmindinvesting.org now today or talking about well rising interest rates and what did they mean when it comes to you investing your saving your spending that maybe maybe future big tag purchases or maybe your summer vacation chatted a bit about that run Mark a great information here as to the back story on how we got here with interest rates. Why were seeing the move up in the bond market respond accordingly.

I explained the relationship for listeners between higher interest rates.

Though in the stock market specifically sure. So I think it's important first to state outright that rising interest rates aren't necessarily a bad thing for stocks. If there rising for the right reasons and as we just discussed that what were talking about there. If the economy is getting healthier. And if the pace of those rate increases isn't coming too quickly and that can actually be an okay environment for stocks.

There are lots of examples in the past when stocks did just fine even when interest rates were rising but there are some risks we've also seen some cases where rates went up, and eventually Canada torpedoed the stock market. We saw that in 2018 where we had the better part of a couple years of study interest rates that didn't seem like a problem until all of a sudden they were a problem in the stock market, rolled over at the end of 2018. Because of those rate increases one of the things that tends to happen is there's this this kinda cute shorthand that's developed over the last decade or so, called the Tina effect and that's shorthand for there is no alternative in the idea that there is interest rates have been held so hello this idea has developed that there is no alternative to stocks because bonds just aren't yielding anything and what happens is as interest rates creep higher. Now all of a sudden you gradually do start to have an alternative to stocks and someone who maybe a year ago and that 10 year treasury bond was yielding one half of 1% they might've said well it's not worth the time to put my money in the stock market, but now today when that yield is 1.6%, they might start to change their thinking a little bit that we gotta be careful here because like I was just saying we fed this rise in interest rates and yet today the S&P 500 index hit a new all-time high. So the impact on stocks has not been tremendous. To this point. Although we did see kind of a little wobble at the end of February and the stock market when those rate increases were really picking up but that is one thing to be on the lookout for that investors are getting a little bit concerned.

Hey you not 1.6.

This isn't so bad but what if this interest rate goes up to 2% around the 2 1/4 2 1/2 at some point that could be a problem for the stock market, you mention the wobble that we saw at the end of February. It started to look like. Perhaps the stocks that were going to see increases perhaps would shift away from some of these highflying tech stocks in a very limited portion of the market over to a more broad-based even some of the sectors that have been out of favor like small And are you seeing any trends that are sticking their yeah that's a great point. Actually it wasn't so much that the whole stock market had trouble but what we really saw was the beginning of a rotation. These big tech stocks that really carried the market through most of last year and frankly have been the driver of stock market performance for the last few years. They really took it on the chin, whereas, as you said these other small Smaller Companies and Particularly Areas of the Market like Energy Stocks Financial Stocks Financials Always Tend to Do Pretty Well When Yields Are Rising Because That's Good for Banks, the Wider Interest Rate Spread Helps Them Because They Can Can Give Us the Low Interest Rates on Our Savings Accounts Because the Fed Is Keeping Their Foot on Those Short-Term Interest Rates and Keeping Those Low but the Rates That We've Been Talking about Here Today Are Rising and They Can Charge Those Higher Rates on Their Loan Product so That Helps Profitability and the Banks so Is Really More of a Rotation in Stocks Out Of Those Big Tech Growth Names and All Of A Sudden We Are Seeing A Lot Of Interest in These Kinda Left for Dead Value and Smaller Companies Will Have a Chance to Get Some Questions and for Mark Miller in Just a Bit. If You're a Retiree. Perhaps You're Counting on the Income Portion of Your Portfolio Wanting to Know How This Rise in Interest Rates Is Going to Affect You. I Know He'd Love to Speak to You Today.

800-525-7000. We Have Some Lines Open Heart. Let's Switch to That Bond. The Portion of the Portfolio and Talk about How This Rise in Interest Rates Will and Will Affect Bond Yeah so Simply Put, Rob. Unfortunately Rising Rates Are Bad News for Anyone Who Already Owns Bonds so We We Alluded to This a Minute Ago, but the Cardinal Rule of Bond Investing Is That When Bond Rates Move in One Direction. Bond Prices Always Move the Opposite Direction. So These Rising Rates Have Been Hurting Existing Bond Owners by Pushing down the Prices of Those Existing Bonds. Now the Flip Side of That of Course Is That These Higher Yields Make Any New Bond Purchases Much More Attractive You're Getting 1.6% on That Treasury Bond Instead of One Half of 1% so It's Kind of a Mixed Bag. If You're Already in Bonds. This Isn't Great, but at the Same Time It Actually Helps Future Returns for Bond Investors to Have These Higher Rates As Long As They're Not Continuing to Just Go up up and Away so That That's Kind of the Big Picture for Bond Investors.

You Have To Be Willing to Wait It out, Though, Because You May Temporarily Seal a Paper Loss in the Value of the Bond Even Though You're Enjoying Those Higher Rates.

Longer-Term, Right Yeah That's Absolutely Right, and As Long As These Rates Continue to Rise Those Current Bond Investors Are Likely to Continue to Feel Some Pain Yeah Very Good. Let's Talk about in Terms of Protection from the Rising Interest Rates You Mention Specifically Build Buying into the Bond Market on the Longer End, Especially If These Are New Investments.

What Other Options Because I Know You Mentioned Some Really Specific Investments That Are Often Not on Folks Radar That Might Be Helpful in This Environment. Yeah, There Are Few Things That Bond Investors Can Do to Protect Themselves, to Know That the Traditional Advice and a Rising Rate Environment Is to Shorten the Maturities of the Bonds That You Own. So, That of Buying Long-Term Bonds You Buy Short-Term Bonds and Those Shorter Maturities Are Going to Move Less As Interest Rates Move and They're Going to Hurt You Less If We Get More More Interest Rate Increases in the Unfortunate Part of That Is You're Getting Those Lower Short-Term Yields on Those Short-Term Bonds. But That's One Thing People Can Do Another Thing Is to Buy Individual Bonds Where You Know Exactly What Your Return Will Be As Long As You Hold That Bond All the Way to Maturity Than There They Specific Types of Bonds You You Mention Rob One Is Called Tips That Treasury Inflation Protected Purities and Those Will Help Protect against Rising Inflation and There's Another Tool That We Wrote an Article about That's Actually up on Our Our Website for Your Listeners to Look at but in This March Newsletter. We Wrote about This New ETF with a Bond Product Called I Eyeball That's Ticker Symbol IV OL and This ETF Is Specifically Designed to Benefit from These Rising Interest Rates, but a Great Performer Lately and That's Really the Opposite of How Most Bonds Respond, Which Makes It Very Unique and That's Why We Wrote about at This Last Month Love It Well.

Lots of Great Ideas There Still Some More to Talk to You Mention Inflation Right after This Break Your like to Come Back and Talk about That. Specifically, This Expansion in the Fed's Balance Sheet, Fancy Way of Saying All This Debt That Were Taking on As a Nation When the Applications of That in the Form of Prices and Even As a Relates to Our Economy and the Market Plus Questions from Listeners All That Right around the Corner. This Is Money Wise Live He's Rob West, I'm Steve Moore, Mark Diller with Us Today Were Talking about.

Well, As We Always Do Stocks and Bonds Today. Of Course, Rising Interest Rates and Anything Related to That Is Her Phone Number 800-525-7000. If You like to Join the Conversation.

We Love to Hear from You.

800-525-7000 Will Be Right Back Don't the Way This Is Money. Wise Live Back to Moneywise Live, This Is Rob West, Mark Miller, Our Guest Today and There Were Talking, Interest Rates, the Rising Rates. The Implication of That on Your Investment Portfolio Your Bonds or Stocks and All That That Means Were Also Talking about Inflation in Mark You Brought That up. Talk to Us about the Implications Related Specifically to Inflation. In This Environment. Sure, There Are Two Well-Defined Camps Right Now As Far As Inflation Goes, Rob, There's a Group That the Fed Is Kinda Championing This Point of View, and That Is That the Inflation That Were Seeing Right Now Is Transitory. That's Kind of the Buzzword Right Now That Were Seeing Some Inflation but It's Only a Result of Coming from These Really Depressed Economic Levels and That Once We Kinda Work through This Initial Reopening That This Inflation Is Going to Go Away and That's One Point of View, That's Kinda What the Fed Is Saying Is They Think Is Likely and the Implications of That Would Be If That's True, Then There Really Wouldn't Be Any Reason Why Interest Rates Would Continue to Keep Increasing Very Much from the Levels That They're at Right Now There's Another Point of View, Though That Is Saying Look, We Have Not Had Sustained Inflation for Many Years. We Had a Big Inflation Scare Coming Out Of the Great Financial Crisis in 2008 When A Lot Of People Thought We Were Going to See Huge Inflation Because of All of the Central Bank Money Printing and the Debt and so on and so Forth. What We Didn't See Inflation. Following That Episode, and so This Camp Kinda Have To Answer for That in Their Answer Is Well Coming Out Of That Crisis.

We Were Relying Almost Entirely on Central Bank Policy to Try to Stimulate the Economy That the Federal Government Wasn't Really Doing Much to Inject Money Directly into the Economy to Help from That Side of Things, Whereas Today We Have a Very Different Situation Where Were Getting These Checks Cut Directly from the Government. Individuals Were on I Think Are Third-Round of Those Now Were Seeing A Lot Of Direct Stimulus from the Government into the Economy with Unemployed but with Unemployment Benefits, and so on. There's A Lot Of Talk about Potential Big Infrastructure Package Coming down the Line, and so the People Who Are Not Convinced That This Is Transitory, and This Inflation Is Transitory, Ours Are Pointing to the Fact That We Have Everything That We Had Last Time in Place Because the Fed Is Still Got Their Foot on the Accelerator, Doing Everything They Can Do.

But This Time We Also Have These Direct Injections of Money into the Economy by That the Federal Government, and so That Argument Is Saying This May Not Be Just a Transitory Thing. This May Actually Have Some Legs and Last A While.

Now It Is so Important for Me to Follow That up with Were Not Necessarily Talking about like Hyperinflation, like the German Situation after World War I, but We Don't Need to Be Talking about That We Have Not Seen Three and 4% Inflation for Decades. And so Even Just Getting Inflation up into That Three or 4% per Year and Having It Stick There for a Little While. That Would Be a Pretty Big Adjustment for the Economy and for the Financial Markets. As We Just Haven't Had That for Quite A While. Fascinating Marker so Much. Here We Could Talk about That Were Headed to a Brakes with about Needing to Say Goodbye to You As Quickly.

Sam's Question When I Get to Be Able to Get to It.

He's an Elected Official in City Government. He Wants to Know Your Opinion on Government Debt Versus Private Citizen Debt Say in Their City Projects That Need to Be Funded. How Should They Financed That Any Difference in the Two As We Look at It from a Biblical Perspective Well I Think the Biggest Difference Is That in a Municipality, City or Town.

Whatever Happened a Much Longer Lifespan. It's Kind of a Continual Entity and There There Are Projects That It's Very Reasonable for the Community to Band Together and That Project and Even Think about That As a Project to Benefit over Time an Individual or Family Has To Be Much More Careful with That Line of Reasoning Absolutely Brief Biblical Principles Apply to Everyone. But As You Point out, There's Little Difference There. Mark Really Appreciate You Stopping by Today.

Fascinating Information Always Agreed to Always My Pleasure. Thank You for Being with Us to Take Your Questions Right around the 525-7000.

This Is Moneywise Live Right Back and Stay with Us in Honor and Pleasure to Have You Listening Today. Thanks Very Much for That and Again Her Phone Number 800-5257 7000 Talking about Anything That Concerns You. Today Anything Financial Is a Great Time to Call 800-525-7000. This Begin by Going to Minneapolis Hi Evelyn, Thanks for Your Patience. Today What's in Your Mind That We Will like Yeah That's a Great Question and the First Thing I Would Always Say Evelyn When You're Talking about Saving for Specific Projects Were in This Case Your College for Your Kids, Which Is the Really Important I Would Want to Make Sure That There Are Other Playthings in Place First. So for Instance I Would Want to Make Sure You Have an Emergency Fund That Would Want to Make Sure You Have a High Interest Credit Card Debt Paid off That You Are Contributing to a Retirement Account, At Least to the Matching Portion, but Preferably You Know, North of 10% of Your Take-Home Pay Because Keep in Mind You Know Those Are Those Things Are Critical.

There Are Other Ways to Fund College but If You Have Your Financial Foundation under You Then Absolutely It's a Great Idea to Be Saving for Some of Those Other Medium-Term Goals That Are Very Expensive in College Certainly Is in Terms of the Savings Vehicle You Are My Favorite Tool for This Is the 529 College Savings Plan. Think of It like a Roth IRA in the Sense That You Don't Get a Deduction. When the Money Goes in.

Although You May Get a State Income Tax Deduction. There Is No Federal Income Tax Deduction and Then It Grows Tax Free As Long As You Use It for. In This Case, Qualified Educational Expenses, and If You Do That All the Gains inside the 529 Plan Because It Wasn't to Be Invested inside That Account All the Games over Whatever Period of Time That Monies in There Is Going to Be Tax-Free. Again, Assuming You Use It for Qualified Expenses Related to Education Now Which 529 Because Every State Has Their Own and Each One Will Use a Different Plan Administrator, Meaning They Have Different Investments inside Their Plans and My Favorite Websites or to Help You Make That Decision.

Evelyn Is Called Saving for College.com Saving for College.com and Here's Why.

What They Will Do Is Build Go through a Free Process with You Where You Answer a Series of Questions and Then Bill Look at the Benefits of You Staying in the State of Minnesota with Their Front 529 Due To Any In-State Tax Benefits Versus You the Better Potential Investment Performance by 529 outside of the State of Minnesota, and Then Compare and Contrast the Two and Actually Rank the Various 529 Plans for You in Your Specific Situation so That Would Be the Direction That I Would Go and Then It's All about Automating It so Your Systematically Contributing to That 529 Plan Wherever You Open It up and Then Letting That Money Grow until You Need It. Does That Make Sense yet.

Okay. We Appreciate Your Goal Today.

Thanks Evelyn Thank You Very Much. Let's Go up to. Let's Step North, but a Bit More to the East Time Calling from Maine What Your Situation Time.

Good Afternoon, I Receive a Letter in the Mail from the IRS Last Week and Had Been Baffled. Title Is Your Second Economic Payment and Said the U.S. Treasury Department of Treasury Issued You a Second Economic Impact Payment EIP to That Provided by the Covert Tax Relief Act of 2020. Then I Went on to Say in EI Payment of $1200 Was Issued by Direct Deposit so Low I Didn't Know I Was Getting Another $1200. You Will Use the Thing to Me Be Legitimate Infected Probably Is. If Infected Came from the IRS and the Information in the Letter May or May Not Be Correct. Here's Why. The IRS Accidentally Sent out Letters Back in February, Telling Many Thousands of People They Wouldn't Receive Checks for the Second Round of Stimulus Payments and Later Had to Admit Those Letters Were in Error. So the Letter You Received May Have Been an Attempt to Correct That If the Agency Felt You Were Still Do Something at Any Rate, Another Round of Stimulus Checks Is on the Way of the American Rescue Plan That Pres. Biden Signed Last Thursday Included $1400 Stimulus Checks.

Individuals Making 75,000 or Less. 2800 Couples Filing Jointly to Make Hundred and 50,000 or Less. With Regard to Whether or Not You Have To Worry about As Long As It Didn't Tell You to Take Any Action, Then You Don't Have To Worry about Whether Somebody Was Trying to Tell You Something to Compromise Your Information or Get You to Take Some Action That Would Be Fraudulent so I Probably Just Disregard It and If You Have Further Questions As to Whether or Not You Qualify for This Latest Round of Stimulus Checks Which Again Are on the Way to Americans As We Speak. You Could Certainly Go to IRS.gov, but If You're in E-File or That the Check or That Payment to the EIP Pain Would Come Right into Your Account Would Be Okay for Him. Well, It's Not a Check. It's Just an Announcement Right It's and so This Does Not Eat Nothing. He Has To Actually Take to the Bank or Anything like That, No, No, I Would've Just Been Notification That the Check Payment Is on the Way Tell More Glad That You Will Give Us a Heads up on That. There's a Very Good Chance That Some Others out There May Have Received the Very Same Thing but Yours Is the First We've Heard about so We Appreciate You Bringing That to Our Attention. Thank You Very Much. Let's See, Coconut Creek, Florida Hello and What You Question for Rob Call Yes I Talked about but My Question on Refinancing Your Mortgage on 2014 4.25. Currently My PI $904 Total Contracted about 1527 and Next Increase. Another Hundred Dollars, so I'm Looking to Refinance with This Home. I Do Have a HELOC Variable at 4% 15,000 Diving Talking to Different Vendors Training Information so My Question Is Thanking You While Actual Plan. One Thing I Would Have To Be All That I Want to Subordinate or Not. The Brainy Shortcake Shine and Amanda Questioned If I Gave You Two Scenarios Which Would Probably Be Better. Our Advocate Attorney Question Here. Why Is This a Part of the First Mortgage Payment Increasing Because of Increased Escrows Is That Right Problem yet Poppycock to Hear Something.

I See What You Owe on the First Mortgage Hundred and 61,000 Okay. What Is the Home Worth Roughly 200 about 200-9200 90 Okay and You Said You Have a 30 Year Mortgage. How Long Ago Did You Get This Setting. 2014 August the Okay Yeah You Have You Looked into Refinancing and Because Here's What I'm Thinking of. And If You Went with a New 20 Year Mortgage and You Have a Good Credit Score.

You Have Good Documentable Income You Could Get a Much Better Rate.

Perhaps Save Even a Point and 1/2 .3 Quarters or More.

So I Had a Lender a 15 Year Mortgage at 2.5% and IPI Would Increase to 1200 Be about 30,000. Okay, Let's Do This. Let's Take a Quick Break. You Hold the Line, We Come Back Get That Other Samaritan Will Indeed and Thank You Very Much.

800-5257 Is Calling from Florida.

She's Interested in Refinancing HELOC for Examining Several Different Options. Yeah and I Appreciate the Information You Give Us before the Break in the You and I Have a Chance to Talk Just Briefly off the Air for Me to Get A Few More Numbers but Essentially You Got This Mortgage in 2014. About Seven Years Ago. It's a 30 Year Mortgage at 4 1/4.

The Principal and Interest Is 904+ Taxes and Insurance and You Got a HELOC at the Variable Rates of 4%. Right Now That's Headed Higher of about 15,000, You Got Good Equity in the Home in That You You You Only Owe Hundred 61 in the House Is Worth Well over 200,000. I Think the Key Here It with These Options Is Let's Go Back to Kind of the Principles behind When Refinance Makes Sense Number One Want to Make Sure We Save At Least a Point to a Point and 1/2. If Possible, Number Two, We Want to Make Sure Were to Save or Skews Me Stay in the Home for At Least 5 to 7 Years so We Can Recoup the Cost of the Refinance through That Saved Interest Rate Number Three. We Really Don't Want to Spend More Than 1 to 2% of the Loan. In Closing Costs. So Max on $161,000 Loan I Be Looking for You to Spend around 36, $32-$3500 Max. So These Loans That You Had Quoted at 6000 in Closing Costs and 9000 in Closing Because They're Either Charging You Discount Points to Quote by the Rate down There Charging Origination Points, Which Is Way Too Much Money I Would I Would Move on from Those Quickly.

So What I Would Do Is I Go Back in Again to Begin Shopping This around with At Least Three Quotes I Would Get Perhaps One from Your Bank. I Look for to Online Lenders and I'd Look for Those a Bank Rate.com and See Where You Can Save At Least Your Appointment Half of Which You Should Be Able to Do It, No Problem.

That Be a 2 3/4% Interest Rate for a 20 Year Mortgage Which Is Gonna Knock Three Additional Years off Your Current 30 Year That Your Seven Years into His Can Keep Your Payment around $1000, Which Is Only Hundred Dollars More and You Said You Have Room to Go up 802,000 Because That's the Margin You Have, Every Month, but I Really Want You to Focus on Not Overpaying with Those Closing Costs When That's What I Want You to Get Some of These More Aggressive Online Lenders in the Mix and Make Sure That Just Because They Have a Bunch of Advertisements on Television Doesn't Mean They're Giving You the Best Price and so That's Why That Tell 1 to 2% of the Mortgage in Costs Is a Good Barometer to Make Sure You're Not Overpaying If They're Not Willing to Do It. You Just Move on Because You Got a Great Situation Here with a Really Attractive Environment so That's Can Be My Best Advice for Your Local Bank Plus Bank Rate.com and Let's See If We Can Find a New Mortgage That Winds up with All Those Things and Thank You Very Much. We Wish You the Best Rob before We Say Hi to Joanne I Know You Wanted to Say Something to Her Listeners Because of Their Wonderful Generosity Last Week. Oh Absolutely, You Know, It Was so Much Fun on Share to Be Able to Hear from so Many Might Be Wise Listeners and Here's the Thing, God Responded You All Responded and We Just Want You to Know How Grateful We Are No Here at Money Was Media Our Partnership with Moody Radio Is so Important to Us. There Is No Better Home for This Radio Program Then Moody Because It's All about God's Wisdom and Today's Decisions and Choices and That's What We Do Here on This Program so Were Just Grateful That You Were Generous in Your Hearts and Generous with Your Resources and Because of That the Lord Really Provided. Amen. You Certainly Did It Right down to Ridgeview, Illinois Hello Joanne, Thanks for Holding What You Question I Have Took out Some along for Some School Courses behind or Something of the Company That Merely to Find out Words.

Then I Given My Son the Company and the Number Now Apparently My Name Is a Reference but Can't Hold Me Responsible in Any Way Planning Know As Long As You Haven't Signed Anything Joanne You're Not on the Hook. Now I'm Not Saying This Would Be the Case with Your Son.

But Anytime You Think Someone Might Have Fraudulently Signed Your Name, You Should Check Your Credit Report and Annual Credit Report.com and You Might Want to Consider Freezing Your Credit Which Is Free and Basically Just Applies a Pin Number so That Nobody Can Pull a Copy of Your Credit Report for the Purposes Best of Extending You New Credit without Knowing That Pin Number.

Of Course If They Don't Have It and That Would Stop Them Right in Their Tracks. But As Long As You Haven't Said Anything, You Should Be on the Hook for It, and It's a Good Idea for All of Us to Continually Monitor Our Credit Reports.

I'm Talking about, You Know At Least Four Times a Year If Not Every Couple of Months Just to Be Sure That We Don't See an Account Pop up to. We Don't Have Any Knowledge of Which Means Our Information Was Compromised. Great Question Joanne. We Wish You the Best on That Anger Sent.

Thanks Very Much a Lowell, Indiana Jeff, I Can We Help You Sir. Just Recently We Found out Some Medical Conditions That Weren't Have To Either Add on All and so Either I Have Money to Pay for Correctly Pay Cash or Should I Take a Loan or Mortgage on It Because Interest Rates Are Low, and Then Invest That Money and Not Just Make Payments Yeah What Stage of Life for You and Jeff Are You in Your Prime Working Years.

Are You Close to Retirement in Retirement Postretirement. Okay.

All Right.

You Know I like the Idea of You, Especially Being Close to Retirement with Your Wife's Medical Situation. I like the Idea of You Being Debt Free Now If It's Going to Put You in a Real Bind in Terms of Being in a Cash Crunch Certainly Wouldn't Want You to Go to up Your Emergency Fund or Something like That. But If You Got a Healthy Emergency Fund and You've Got Some Surplus There Kind of on the Sideline and Keep in Mind As You Head toward Retirement, You're Going to Get More Conservative in Your Investment Posture, Which Means You Don't Have As Much Upside, Not to Mention the Fact That Where You Know 12+ Years into a Massive Bull Market in and We Know the Economy and Stock Markets Tend to Be Cyclical and so at Some Point This Is Gonna Roll over and You Will Have a Recession at Some Point That Needed to Be This Year or Even Next Year, but We Will and You Want to Have Time on Your Side When You're Investing so That When Those Things Come You Just Ride Them out, but If You Have a Chance Heading into Retirement to Continue to Remain at or near Debt Free. I'd Say You Go for That and Enjoy That Flexibility That Comes with Being Unencumbered. Jeff Does It Make Sense for We Have No Debt.

Now Yeah I Wouldn't Take on That Debt, and Less Is Gonna Put You in a Real Bind in Terms of Cash Available to Have for Flexibility, General Everybody God Bless Go to a Christian and Yes Christian the Minnesota Christian Huckabee Helps You A Lot You Are No Yeah Yeah Many States in the Federal Housing Ministration Kristin Have Needs Based down Payment Assistance Grants so You Would Just One Look in This to That to See If You Qualify, You Could Do Some Quick Research on the Web and If You Do Qualified and That's What It's for. You Could Take Full Advantage of It. Most People Don't. But There Certainly Is a Possibility If You Fit into One of These Categories That You Could Get It in Need Needs Based Assistance Grant with Regard to the PMI You Know I Don't Ever Think You Should Take on a Mortgage without Putting 20% down. Here's the Thing.

When You Get over 20%.

You Got Your Some Equity in the House.

Keep in Mind Just like the Stock Market's Been Going Straight up so As the Housing Market and If We Were to Get into a Recession and Housing Prices Were to Take a Dip. You Certainly Wouldn't Want to Be in a Situation Where You Were Upside down in the Home. This Is Going to Ensure That You Won't Be.

Remember the Long-Term Goal Is to Be Debt-Free Including Our Home. So Why Would We Make a Meaningful Step in That Direction and There's No Reason to Pay PMI If You Don't Have To. It's Not Money or Ever to Get Back Doesn't Do Anything for You It's for the Benefit of the Lender, Not Use. So That's Just an Added Unnecessary Expense.

So, I Would Respectfully Take Their Advice and Pass on It and I Just Continue on the Track You're on, Which Was Saving Diligently to Buy a Home You Can Afford That You Ultimately Want to Own Free and Clear, and We Will Let You Go on That Christian. We Appreciate Your Call Today. Trusted Information Will Be Helpful to You.

Thanks Very Much.

Just a Little Bit of Time Rob, so I Want to Ask You Once Again If You Don't Mind about the Money Wise Aft Because We Think That Lots of Concerns Could Be Solved If Everyone Was Living on Some Sort of a Spending Plan. The That That They Actually Have Written down What You Want to Call the Spending Plan or a Budget and That's with the New Money Wise App Does for You in Spades Right Well Is No Question about Use Three Components to the Brand-New Money Wise App. The First Is the Best Digital Envelope System I've Ever Used Your Labor Talked about the Digital Envelope, Not the Digital the Envelope System Back in the Day. Using Physical Envelopes and You Know It's Probably the Best Most Tried-And-True Approach to Controlling Spending That I've Ever Seen.

Which Is Why You Still Hear about It Today and the Idea Is That If You Put Your Resources and Allocate Them into Envelopes, Whether Physical or Digital. You Can Always Know Exactly Where You Stand during the Month and Each One of Those Categories We Just Basically Put It into a Beautiful Interface with the Latest Technology, Put It in the Palm of Your Hand in the Form of an App Allow You to Connect Securely to All of Your Institutions to Download Transactions Instantaneously Automatically Categorize Them Just Give You All That Powerful Information at Your Fingertips You Put That Alongside the Community Where You Can Ask Questions and Have Discussions with Other Stewards and Are Discovered to Have with the Best Content. Biblical Finance Comes Together in One Place and That's the Moneywise That Will Find It in Your App Store Today.

Thanks Moneywise Is a Partnership between the Radio and Moneywise Thanks so Much for Allowing Us to Your Radio Today. I Have a Great Remainder of Your Day and Join Us Again Tomorrow


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