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Investing Lessons at the Beach

MoneyWise / Rob West and Steve Moore
The Truth Network Radio
June 22, 2021 8:03 am

Investing Lessons at the Beach

MoneyWise / Rob West and Steve Moore

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June 22, 2021 8:03 am

Summer’s officially here and if your plans include the beach, you might be interested to know that while you’re relaxing with your toes in the sand, you can learn a lot about investing. On the next MoneyWise Live, host Rob West welcomes investing expert Mark Biller to share some of those investing lessons. Then Rob will take your calls and questions on the financial matters you’d like to discuss. That’s MoneyWise Live—where biblical wisdom meets today’s financial decisions, weekdays at 4pm Eastern/3pm Central on Moody Radio.


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It always seems so traumatizing to see that little one run for an egg she has her eye on, only to have a bigger kid sweep in and steal it at the last second. Hi, it's Doug Hastings with Moody Radio, and unfortunately this same kind of situation has become a traumatizing reality for families all across the country. Families are out searching and finding their dream home, only to have it pulled away by another hunter at the last second, which is why I'd really like you to meet my friends at United Faith Mortgage. Unfortunately, this faith- focused mortgage team can't scare off the other hunters, but they can very quickly get you pre- approved and make it look as good as possible to sellers. They've specifically made a commitment to this podcast and our listeners to do all they can to help you.

You can find the entire United Faith Mortgage story and especially read how their direct lender advantage can often save your family monthly and lifelong money at Summer is officially here, and if your plans include the beach, you might be interested to know that while you're relaxing with your toes in the sand, you can learn a lot about investing. Hi, I'm Rob West.

Yes, it's true. The beach holds some important lessons for making wise decisions about your money. Investing expert Mark Biller is here to tell us about them. Then it's on to your calls at 800-525-7000.

That's 800-525-7000. This is MoneyWise Live, where God's financial principles guide our every step. So, our guest today is Mark Biller, executive editor at Sound Mind Investing, where it seems folks think about investing, even Mark, when they're at the beach. Welcome back to the program. Well, thanks, Rob.

Glad to be here. We're talking about an article in the latest Sound Mind Investing newsletter. It's entitled, as you well know, everything I needed to know about investing I learned at the beach. It's clearly light-hearted, but has some incredibly practical wisdom in it, doesn't it?

Yeah, it sure does. You know, this is an article that our founder, Austin Pryor, wrote several years ago, a few days before heading off for his family's annual vacation at the shore. So, the beach was on his brain, and it's a kind of a clever summertime way to drive home some investing basics. Yeah, absolutely. Well, we want to meet people where they're at.

This certainly does that. Let's walk through some of those practical investing lessons to be learned from going to the beach. Where do we start? Well, the first lesson is to make sure your basics are covered, and so Austin kind of starts this article off by saying, you know, you can't just leave for the beach anytime you want. If you want your trip to go well, to be able to have a great vacation, some preparation is usually required.

So, for the beach, that might involve finding a place to stay, maybe lining up a house sitter, getting some extra cash to have on hand, those sorts of things. And when we translate that over to our investing, there's also some important preparation that we need to do before we just dive right in and start investing in individual stocks or whatever we might do. And specifically there, what we're talking about is investors really need to lay a firm foundation.

They need to put the groundwork of getting out of debt and saving up an emergency fund in place before they start off on any grand investing adventures. Yeah, no question. Obviously, preparation is crucial, and Austin makes that really clear. Mark, what's the next lesson? Well, it's what most of us would do, Rob, before taking any road trip, and that's figuring out what your travel plan is and then trying to stick closely to that. So, for vacation, we'd normally map out the route we're going to take ahead of time so we know the way. You try to leave on time. You drive safely. You avoid taking unplanned detours, those sorts of things. And while that might sound a little bit rigid to some people who are, you know, want to free spirit it a little bit more, you know, we point out that the point here is really to reach the beach safely and on time. And that's how we think that people ought to think about reaching their retirement goals. It might feel a little rigid, but when it comes to saving for retirement, the goal isn't to have an exciting journey. It's to reach retirement safely and on time with your finances.

So, you know, when we translate that into practical terms, we're talking about following a personalized stock bond allocation and long-term plan, plenty of diversification, and trying not to take lots of detours along the way when these exciting new investing billboards try to entice us from the side of the investing road. I love it. All right, now we're at the beach.

We have our investing plan in place and staying with the lighthearted theme. You want us to be patient with our tanning goals? What?

That's right. So we want to be patient with our tanning goals. We don't want to fall for those high-risk, get-tanned-quick strategies. You know, it's just too easy to get burned. So keep it simple.

We don't need tanning seminars and gurus. It really isn't that complicated. Follow the basics.

Don't try to do too much too soon, and we won't go wrong. Yeah, and it's exactly the same with investing. Well, we're talking today about everything you need to know about investing.

You can learn at the beach. It comes right from the latest Soundmind Investing newsletter. It's an article entitled, Everything I Needed to Know About Investing I Learned at the Beach. We'll continue with much more just around the corner. Mark Billers with us today. Taking your calls in just a moment, 800-525-7000. This is MoneyWise Live. We'll be right back. Welcome back to MoneyWise Live.

Thanks for joining us today. We're going to be taking your phone calls just a bit longer, further down the road in the program, but we'd love for you to go ahead and get in the queue. If you have a question today for Mark Biller or myself on anything financial, we'd love to hear from you. Here's the number, 800-525-7000.

That's 800-525-7000. Mark Biller's executive editor at Soundmind Investing. Today, we're talking about a recent article in the latest SMI newsletter. It's a lighthearted approach to investing with everything you need to know, but it has a beach theme.

We've already talked about the fact that you need to make sure the basics are covered, that you're prepared to start investing, meaning you've got that emergency fund in place and you're living on a spending plan. You've got your consumer debt paid off, that you have a plan to get there so you know what your goal is and you're not taking any detours along the way, and then that you don't get sidetracked with the latest get-rich- quick strategies, which it seems, Mark, has been all too common these past few months. Mark has been all too common these days, you know, between some of the high-flying tech stocks and the cryptocurrency fad. It seems like investors are more distracted than ever with get-rich-quick opportunities.

Are you seeing that? Oh, for sure. You know, and I think that when you have a run like we've had in so many different areas since really last April and especially since last November when things really took off, it's just, you know, that fear of missing out, the FOMO that people talk about really kicks in, whether it's crypto, even, you know, commodities.

We've seen these rips and more basic stuff. So, you know, you tend to think of tech stocks and cryptocurrencies and those kinds of things as often being real speculative, but when you're seeing, you know, copper and oil and just kind of regular stuff taking off here lately, too, it's really easy for investors to kind of take their eye off the ball as far as their long-term plans and feel like they want to maybe take a little extra risk and go after some quick profits. But as we've seen here in the last couple of months, especially with the crypto, that can really be a dangerous way to go, and you can lose a lot of money just like people can make a lot of money in short periods of time. Yeah, no doubt.

You've got to be on your guard there and stay focused. Steady plotting is the idea that the Bible uses, and I think that's wise counsel for us today. Before we take some phone calls, and by the way, if you have an investing question for Mark Biller today, 800-525-7000, Mark, give us the next principle from this article, and it has to do with wave patterns, doesn't it? Yeah, so that next investing lesson you can learn at the beach is to ignore the short-term wave patterns, and, you know, maybe like me, you like to read at the beach with one of those low-slung chairs right at the edge of the water, and if you've done that before, you know that those waves can be a little unpredictable, and you've got to move your chair from time to time to keep from getting soaked by those waves. The point we're trying to make here in this article as it relates to our investing is, while the waves follow a trend, they are unpredictable in the short term, so you might think that they're going to stop a few feet away, and then all of a sudden a really strong one comes in and gets you, and so short term, they're erratic. Longer term, we can look at tide charts and whatnot and get a pretty predictable idea of where those waves are likely to go, and it's really similar with our investing, so we're trying to avoid trying to predict where each individual wave, the real short-term moves of the market, are going to come and go, and instead we're going to try to base things more on these longer-term trends and build in a little bit of a margin of safety so that those occasional waves that come in strong aren't going to really upset us, and we're not going to overreact either when a short-term wave comes in a little stronger than we anticipate. Yeah, no doubt, and that's so important to remember. It's all about the long term. That's easy to say, more difficult to do, and yet so critical to effective investing, which is for sure over the long haul.

All right, Mark, one more and then we'll get to some phone calls. Okay, well this next one is something you really don't want to do at the beach or in your investing. That's comparing yourself to others. You know, that can be hard at the beach. We'd all like to look like a 22-year-old fitness model, but, you know, for most of us that's not really realistic.

We've got to tailor our beach prep, our diet and workout strategy to who we are, and that's usually someone who's a little older trying to balance family, work, church, and so on. The point here is very simple, Rob. You know, if a 60-year-old is trying to work out like a 22-year-old, they're probably going to end up getting hurt, and it's the same way with investing. If you're trying to follow an approach that's really suitable for somebody else but not for you, you're probably going to get hurt as well. So you want to make sure that your investing approach is tailored to your specific situation, not some unrealistic vision of someone else. And again, you mentioned just a moment ago, you know, this is the slow and steady plotting wins the race, not crash diets or their investing equivalents.

Yeah, no doubt about that. All right, let's get to some phone calls. We do have a couple of more lessons on investing we can learn from the beach, but we want to know what lessons you'd like to learn today. Let's head to Cleveland, Ohio.

Evelyn has been patiently waiting. How can we help you today? Well, thank you for taking my call. I love your show.

I have a question. My husband's been retired for about a year. I'm still employed for probably another four or five years. We don't have any investments, but we have all our debt paid off except for our house, no car payments, no credit cards, and we have about $80,000 spent in our savings account. I'm just wondering if we should just let it sit there. If we should be investing that, what should we do with that money? Yeah, very good.

Mark, your thoughts? Yeah, so the trick with that, Evelyn, is that, you know, when you start getting closer to retirement age, typically, most people are advised to bring the risk level of their investments down, and so normally that means moving a little bit away from the stock market and more towards bonds and those types of assets. What makes it tricky right now, Evelyn, is that bonds are not yielding a whole lot. Interest rates are so low, so it can feel like, you know, I've got this money in savings. It's not earning a whole lot, but the safer alternatives that you would typically move into, like the bond market, those really aren't yielding a whole lot right now either, so it's a little bit less of a big step up in an anticipated return in moving from the safety of having that money in savings into something like the bond market. Typically, as you're hitting retirement, you know, it's good to have a couple of years of expenses in very liquid savings anyway, so I wouldn't be rushing to take that savings money and get it into something more aggressive.

You could maybe think about taking a portion of that and moving that out into some bond type investments, but, you know, a good portion of that probably it is reasonable to keep that in savings vehicles. Rob, what are your thoughts? Yeah, I like that advice a lot, Mark. You know, perhaps Evelyn, think in terms of a year's worth of expenses in savings and then move beyond that.

Mark, just a quick follow-up for you on that. What would you be looking for in terms of the market conditions and the economic environment for Evelyn to decide it's time to move toward those more traditional retirement income-based investment options? Yeah, I think that, you know, right now we've had such a big run in all of the more aggressive parts of the market, the stock market and so forth, that I would at a minimum probably be looking to be a little bit more opportunistic. If you're going to put some of that into a little bit more risky, you know, stock market type investments, you know, maybe looking to do that on a pullback. As far as the bond side, it probably isn't necessary to really be looking for any big cues. At this point, you know, I would probably tend towards shorter-term, maybe stretching out into intermediate-term bonds, but long-term bonds are going to come with quite a bit of risk, so I would probably avoid those at this point.

Yeah, very good. Evelyn, for some further assistance on that, reach out to the folks at Soundmind Investing. You can do so at All the best to you and your husband in this exciting season of life, and we appreciate your call today. We'll be taking more of your calls. Mark Biller is going to stick around with us until the bottom of the hour, so if you have investing-related questions specifically between now and the bottom of the hour, we'd love to hear from you. 800-525-7000.

800-525-7000. Much more to come on MoneyWise Live, where God's word intersects with your financial life. Stay with us. We'll be right back. We're thrilled you've decided to join MoneyWise Live today.

Mark Biller, executive editor at Soundmind Investing, is along with us until the bottom of the hour. We've been talking about investment lessons you can learn from the beach. It's a summertime theme, and we have one more of those to share with you, but first let's head back to the phones. And Randall, I understand you have a bit of a testimony today. Tell us what you have on your mind. Oh, I tell you, if I was any more full, there'd be two of me.

And by the way, we just got back from Lake Michigan, and so we got our toes in the sand too, but boy it was hot. And so we're home now, but I just wanted to tell not only you folks, but those that are listening, that to me the greatest investment that you can ever make is learning to obey God and tithe. And not only tithe, but give offerings.

That's a step above, say, okay. So consequently, my wife and I have been tithing since we were just kids. My wife tithed long before I did, because I didn't become a Christian until I was about 18.

So when we got married, it was no question. We started, or I mean, we continued our tithing and our giving, and we were on kind of a rough spot, you know, when we first got married and so forth, but we continued doing that because it was simply God's word. And so anyway, we just kept, you know, living for God, and God would speak to us to increase our giving, to perhaps to a missionary, whatever, you know, and you look at the books and sometimes, how does it work? You know, but let me tell you, it works.

It really does. And so I wanted to share that with everybody, and perhaps you said you can't afford to tithe. Well, you can't afford not to tithe. You can't afford not to give, you know, and consequently, God's blessing of it is, we build a new home, we put quite a bit of money down on it, and then here a year or two ago, we paid our house off, and I was always told that if you finance a house for 20 or 30 years, that if you finance it for that length, when you get done paying for it, you've just bought two other homes. You've actually paid for two other homes, and I'm determined I'm not going to live that way, you know. I just don't want to live that way at all, and I've asked that question also, is to this day and age, maybe you have an answer for me, how do people make it today on one income? I do not know, honestly, how people can live on one income.

I knew a couple that they never ate out, they never took a vacation, they never did what a lot of people usually do on a steady basis, you know, because her husband worked and he didn't make that large of an income. Randall, I appreciate your remarks today. I mean, it's such an encouragement, and you share our heartbeat today, and that is we've got to start with giving.

We don't start with provision, although that's important, but we'll end up with an endless list of needs and wants. We start with our generosity, because the Gospel is a generosity story. For God so loved, he gave. And so as we, as an overflow of our gratitude to the Lord, give back, it's amazing what God does in our lives and in the lives of others as we connect with him through our giving, and you certainly affirm that today. So we appreciate that testimony today.

I know it's been an encouragement to those who have heard it. On to Bentonville, Arkansas. Patty, thank you for calling today. How can we help you? Hi, thank you so much for taking my call.

I just happened to be flipping the channels and heard the message and thought, I need to talk to you. So, real quickly, I'm a recent widow. Unexpectedly, my husband developed brain cancer and died after just three months. I have his retirement in a cash account with TD Ameritrade, and then I got a little bit of life insurance.

I don't intend to go back to work now or maybe ever have his Social Security coming in, and I've literally been wondering, what do I do? And so I have an advisor through TD Ameritrade I can speak to. I'm very cautious.

He always handled all this. He had basically gained a lot with our small retirement, and I don't want to make any disastrous mistakes. I just don't know who do I go to to trust. I do tithe first, too, with the previous caller. We are very faithful stewards of our money, but now I need to live off of it or have something, and I'm 64. So I'm looking at how do I, what do I do?

Well, I'm so sorry to hear about your husband's passing. You obviously want to be a careful steward of what God has entrusted to you. I want to affirm this idea that you're not making any quick decisions.

You want to go slow, be methodical, get wise counsel, and I love the fact that you want to honor the Lord in all of this. Patti, am I hearing correctly you're debt-free, your expenses are covered through Social Security, or are you needing to live on a portion of this? Yeah, pretty much. Okay, so if you took an income.

Right now I'm pretty good, but I'm moving into when I start paying Medicare, I may have to pull a little bit out. Yeah, okay. And last question, what is the amount in that investment account? 309.

309,000? Yeah. Okay, yeah.

All right, very good. Let's do this. We're going to pause for a brief break. I'm going to get Mark Biller to stay with us for one more segment, which he is always glad to do. And when we come back from this break, we're going to get him to weigh in on your next step.

So you hold the line. We'll be right back with you. This is MoneyWise Live. Stay with us.

More to come just after this. Thanks for joining us today on MoneyWise Live. I'm Rob West, taking your calls and questions at 800-525-7000. Mark Biller along with us in this segment, talking about investing lessons we can learn from the beach.

Yeah, it's summertime and we'll get back to a few of those lessons in just a moment. Holding the line is Patty, who we were speaking to just before the break. Patty unexpectedly lost her husband after a battle with cancer and is now really just trying to navigate where she goes from here financially. And Patty, as you shared before we went to a break and as we talked a little bit off the air, you've got about 409,000 available, plus a 50,000 in an emergency fund.

You're looking how to manage that on the horizon are a couple of things. Number one, you may need to supplement your income, which is largely covered by Social Security benefits, with this investment account. You may at some point, not now, want to buy a home. That down payment would come out of this and obviously any mortgage that you'd take on, you'd have to be able to cover in your expenses. And then beyond that, you mentioned not having any health insurance to speak of. Let me tackle a few of these first and we'll talk to Mark about the investing side.

I think it's really critical that you hang on to that 50,000 and a liquid savings account. I'd love for you to have at least a year's worth of expenses there just for peace of mind. Number two is, I'd contact our friends at Christian Healthcare Ministries for a non-insurance healthcare solution that's budget friendly. They've shared literally over five billion dollars with Christians over the last 40 years and it would really provide that peace of mind to know that your healthcare was covered per incident over five hundred dollars.

You'll find them at I agree it's not the time to buy a home because A, this housing market is red hot. I don't want you to buy at the top, so to speak. The other issue is, with the uncertainties about where you find yourself wanting to land in terms of location would, I think, prohibit you or really should cost give you some caution about buying right now because in this housing market, I'm encouraging people not to think about staying at least five years, but really ten years just because we could see a dip in the housing market in the next one to two years. So I think I would sit tight. The question is how to invest this money in the meantime, given your need to preserve it so you have it for the future, but also to be able to generate some income that could help to cover any remaining bills not covered by Social Security.

And Mark, what are your thoughts on that piece? Yeah, I would just, first of all, affirm that advice you just gave, Rob, that, you know, waiting a little bit of time before making really big financial decisions is really a wise idea after the death of a spouse. It's not unusual at all that in those first six to twelve months that things that seemed like a really good idea right away, maybe you're getting a little different perspective, the idea of maybe wanting to be in a different location closer to other parts of family or any number of things can enter in there, so I would just affirm that to try to hold off on making any really big financial decisions right away. But as far as trying to supplement that income, there are a number of different ways that you could approach that, and some of that will depend on exactly how much you need. There are some safe ways to do that with fixed income.

With things like bullet shares is one thing that we wrote an article on not long ago that is a fixed way to know exactly how your bond investments are going to pay off over set intervals of time without much risk at all. So there are a lot of different ways you can approach that, and certainly we cover a lot of those in our Soundmind Investing newsletter. But in a situation like this, I'm particularly inclined to encourage people like yourself, Patty, to talk to a couple of advisors and maybe get some input from those folks that have helped other people through similar situations. You've got a couple of really good resources available to you through the MoneyWise Live website, the Kingdom Advisors Group. You might be able to find somebody who's right in your local area.

You could also go to the site, and you can follow a link there to talk to one of our SMI advisory stewardship advisors. We help people in similar situations quite often. But again, I would encourage you to talk to maybe two or three different people and just explain your situation, talk to them, get a comfort level. It may be that you really click with somebody that you think can help you put together a little bit more detailed plan.

And it's not that you couldn't do this on your own with the type of information we have in our Soundmind Investing newsletter, but when you've got so much going on after the passing of a spouse, it can be really helpful to just have an expert come alongside you and be able to walk you through methodically and give you that counsel, and even sometimes just as a sounding board of the ideas that you're thinking about. So I'd hesitate to give you real specific ideas here in a conversation like this. I would really encourage you to maybe make a couple calls and talk to a few folks and maybe get a few different ideas and then be able to sift through those ideas and see what seems right to you there. Rob, any other thoughts?

Well, no, I'd completely concur with that. You need some wise counsel here, but you're on the right track, Patti. So be encouraged, trust the Lord in all of this, be prayerful, but seek out some folks who can assist you. So next steps for you,

Search for a CKA, a Certified Kingdom Advisor in your area. Also avail yourself of And if you hold the line, Patti, we'll send you as our gift today, the Soundmind Investing Handbook, which will get you up to speed on a lot of what Mark was talking about and some biblical principles related to investing.

We appreciate your call. Mark, back to our topic that we started with today. We were having some fun looking at investing principles we can take away from summertime fun at the beach.

And I know we had one more we hadn't covered. What is that idea that you'd like to share with us? Yeah, well, Rob, you know, just like as you would with any trip to the beach, with investing, you've got to expect a few rainy days to be mixed in. You know, if you go to the beach for a week or two, if you get a thunderstorm or a rainy day, you don't just pack up and head for home. You stick it out. Hopefully you've prepared and planned for that possibility. Got some books and board games, whatever you like to do on a rainy day. You also don't panic that that thunderstorm is going to turn into another Noah's Ark type flood.

You recognize it for what it is. Rainstorms come and go. They're a part of going to the beach. And there's the obvious parallel. Hopefully it's obvious with our investing where if we're going to be investing for decades, we're going to encounter multiple bear markets and market corrections along the way.

They're part of the journey. We need to have a long term investing plan that can handle those types of downturns and stick to our plan even when the market is is in one of those periodic rainy days. And hopefully that will help keep us from panicking every time the market takes a dip. Yeah, no doubt about that.

Well, Marcus has been fun, but incredibly practical. Appreciate you stopping by as always. And I know we'll have you back real soon. I'll look forward to that. Thanks for being here. I'll be looking forward to it, too, Rob. Thanks so much.

Absolutely. Our guest today has been Mark Biller, executive editor at Soundmind Investing. If you're headed to the beach or already there, perhaps you can check out this article at

It's called Everything I Needed to Know About Investing I Learned at the Beach. We're going to pause when we come back. More of your phone calls.

Here's the number 800-525-7000. Stay with us. Still more ahead. Delighted to have you along with us today on MoneyWise Live.

Hey, it's the summertime. We've been talking about that today, which also means we could really use your assistance with supporting our ministry here at MoneyWise Media. The only way we can bring you this broadcast each day, plus the MoneyWise coaches and all the great content on the web and the assistance through the Certified Kingdom Advisors and oh, by the way, our MoneyWise app, which now more than 13,000 of you have downloaded.

And we're so excited about that. The only way we can bring all that to you is through your generous support. MoneyWise is listener supported. And certainly during the summer months, more than ever, we rely on your assistance. So if you consider yourself a part of the MoneyWise family and you'd be willing to prayerfully consider a gift beyond the giving you're doing to your local church, we would certainly be grateful.

Whether it's one time or monthly, just head over to our website, Just click the donate button and we would certainly be grateful. Let's head back to the phone.

Chicago, Illinois. Mike, thank you for your patience today. How can I help you, sir? Hi, thanks for taking my call.

I tried to call last week. I had a question regarding social security. I've read about this a couple times, but I never heard anybody talk about it. When a spouse gets remarried, are they entitled to their deceased spouse's social security at some point? I thought I read that they got married over 60, that they could be entitled to their deceased spouse's social security. That's exactly right, Mike.

You're on the right track there. Assuming the marriage had lasted for 10 years or longer at a minimum, then if you remarry after you reach 60 years of age, or 50 years if you're disabled, then it has no effect on your ability to receive your surviving ex-spouse's benefits. And in order to receive benefits from your deceased spouse if you divorce, again, the marriage will have needed to last 10 years or longer. You would not receive a survivor benefit in addition to your own survivor benefit, so social security will pay the higher of the two amounts.

So I think that's the key there. If you're the divorced former spouse of a deceased social security recipient, you might qualify for survivor benefits on his or her work record, and again, they would automatically pay you the higher of the two if you were entitled to your own benefits. But yes, you're right, assuming it lasts over 10 years, the marriage, and if you remarry after age 60, it would allow you to continue to receive those benefits of your deceased spouse, or ex-spouse in this case.

So I hope that helps to clarify this. I know it can get a bit tricky, and if you have further questions, don't hesitate to reach out to the Social Security Administration at They'll do a virtual visit with you, or perhaps in your area you could even visit in person and get all the details.

On to Lake Alfred, Florida. Elizabeth, thank you for your call. How can I assist you? Yes, I have a question for you about the 401-I-R-A-1 that I have received from my retirement. I don't know how to invest, and I'm just lost about it because I had never learned how to invest. Disney always do it for us, the stock market and all that stuff. So I got out during the pandemic, and during the follow-up time I was just got out of it, and the money's sitting there for almost a year now. Very good.

I don't know how to invest it. Did you say Disney as in Disney World? Yes. Okay, is that where you worked?

I was, and then I retired. Very good, all right. Yeah, you know, this is just a very common issue, Elizabeth, because so often, you know, unless you've done this throughout your life or you've been trained to do this, it can be a little bit overwhelming to think about, how do I take this money that I'm sitting on and put it to work? How much do you have roughly in this Roth IRA?

It's about $40,000, a little bit over $40,000. Okay, very good. Let me recommend a couple of approaches. One would be connecting with our friends at Soundmind Investing at Through the Soundmind Investing newsletter, you can get all the assistance you need to use mutual funds, which is basically, think of it as a basket of investment options, so you're properly diversified no matter how much you have, and even $40,000 among a large number of stocks, but in a way that's consistent with your goals and objectives. So through the Soundmind Investing newsletter, you could have recommendations on the mutual funds to use based on your age and risk tolerance and time horizon.

They'll give you all the assistance you need. The other approach, and I would recommend this for somebody with, let's say, less than $75,000, which would be, in your case, appropriate, would be one of the what they call robo-advisors. So you could go to the Schwab Intelligent Portfolios at Charles Schwab. You could look at Betterment or the Vanguard Advisor, but essentially these robo-advisors use a sophisticated algorithm to create an index portfolio, and that's just a fancy way of saying it's a portfolio of stocks that mirrors the broad indexes, but it's properly allocated for your age and risk tolerance. So given that you're retired, it would be a higher concentration toward fixed income type bond indexes and then a smaller portion towards stock indexes, but you'd be really properly diversified. You'd capture the broad moves of the market. It would be very low cost as well, and it's just a real simple and effective way to invest.

So I would check out one of those two,, or if you want to go the robo-advisor approach, the Schwab Intelligent Portfolios or Betterment, and if you have questions after you look into those, don't hesitate to give us a call back. We appreciate your call. To North Canton, Ohio, Brad, thank you for calling today.

Go right ahead. Sorry, I had to take you off speaker phone. That's okay. Sorry, I'm driving while we're talking.

Oh boy, be careful. No, no, I'm good. I'm good. Anyway, anyway, I'm going to pull over here actually. And then my question is this, refinancing my house. I retired a year ago. The payments are not a problem.

I can make those just fine. But I'm at 4.25 and I still have 25 years on my loan. So the thing that I wrestle with is that when you talk to different companies, it goes anywhere from to refinance your house, it ends up adding to the overall mortgage either $5,000 to $10,000, depending on what interest rate.

Is that worth it or not? Well, it depends. So you have a 4.25% interest rate. You've got 25 years remaining. How much do you have left on the balance of the mortgage? $140,000.

$140,000. And do you plan to stay in this home for quite a while based on everything you know today? Well, we went back, but yeah, everything we know today, this was, we bought this home to be a retirement home.

We downsized and got a smaller house from where we were because our kids were all moved out. Yeah. And do you have a good credit score? Yeah, my credit score is just shy of 800. Yeah, great.

So yeah, here's the thing. I mean, if you could save a point to a point and a quarter and you could just about get there, I would imagine with today's rates and the credit score you have, and you're planning to stay in this home for at least five to seven years, you should be able to cover those expenses and they should be in the range of about 2%. So, you know, $140,000, I wouldn't expect you to spend more than $3,000, $3,000 to $4,000 at the most. And if you are, they're probably asking you to buy down the rate or the expenses are just too high. But if you could keep it to around 2% in expenses and save at least a point on the interest rate and stay put for five to seven years, you will be able to repay the expenses with the savings and interest. And then once you do, you'll enjoy that, you know, lower interest rate throughout the balance of the loan.

The only kind of fly in the ointment here is if you move quickly after you pay the expenses back and you don't enjoy the savings or if you lengthen the term. So I'd be looking for a new 25, even better 20-year mortgage as opposed to resetting it at 30 years, you know, after five years of payments. Does that make sense to you? Yeah, it makes sense. And that's what I was going to do 20 years or 15 even, I thought, because I can bump the payment up.

That's not a big deal. But do you think I should only pay him between $3,000 and $4,000? Because it seems like everybody out there, it's somewhere between $5,000 and some of them were at $10,000, which I know they're you know, they're charging way too much. Yeah, I'd keep shopping. I mean, that's that's high. I'd really try to target 2% for your expenses, you know, perhaps two and a half percent, but anything more than that you're overpaying.

I'd use to find some online lenders who have the best programs with the most aggressive terms and low costs and shop around till you find something that really makes some sense. So give that a look. It can make it can make a lot of sense if you do it the way I just described. And I think you'll be glad you did in the long run. And we appreciate your call.

Quickly to Brooksville, Florida. We have just a minute or so left. Eric, how can I help you? Can you hear me? Yeah, I sure can. I've got about 45 seconds.

So tell me quickly what what I can do for you today. If you don't have any investments, you're starting fresh. Yes. Where do you invest? And how much?

Yeah, very good question. Here's where I would start. First of all, make sure you have an emergency fund three to six months expenses. Even before that, I'd want to make sure you're giving systematically. After that, I'd want to make sure all your consumer debt is paid off. You're starting with your credit cards, and that you're living on a balanced budget. Then the first place I'd go, Eric, is if you have a 401k at work, take advantage of that, especially if there's matching. If you're self-employed, which it sounds like you might be, I'd open a Roth IRA, and I'd probably do it at Betterment or Wealthfront or the Schwab Intelligent Portfolios, and then start systematically investing in that Roth using their algorithm with the robo-advisor. And just let that grow over time, sure and steady.

Add to it, which is dollar cost averaging, as you go, and trust the Lord for the outcome. We appreciate your call today very, very much. That's going to do it for us today, folks.

MoneyWise Live is a partnership between Moody Radio and MoneyWise Media. I want to say thank you to my team today, Amy, Dan, Rich, and Robert. I want to say thank you to you for being here today. We'll be back tomorrow to do it all over again. If you didn't get through, call us then, and we'll look forward to seeing you. God bless you. Bye-bye.
Whisper: medium.en / 2023-10-30 13:53:36 / 2023-10-30 14:11:43 / 18

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