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The Transformational Power of Fixed Income

MoneyWise / Rob West and Steve Moore
The Truth Network Radio
July 16, 2021 8:03 am

The Transformational Power of Fixed Income

MoneyWise / Rob West and Steve Moore

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July 16, 2021 8:03 am

Most investors know that bonds make up part of a well-diversified portfolio. But far fewer truly understand the important role bonds play in their financial future and the way they can impact the world. On the next MoneyWise Live, host Rob West welcomes Benjamin Bailey of Praxis Mutual Funds to talk about bonds and having an intentional approach to our investments. Then Rob will take your calls and questions on the financial topics you’d like to discuss. That’s MoneyWise Live, where biblical wisdom meets today’s finances, weekdays at 4pm Eastern/3pm Central on Moody Radio. 

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Hey there I'm Jim and Baxter and I certainly radio is the director of business development.

Our team's job is to find businesses that love Moody radio and Jesus Christ and want to support the work we do financially just like you today.

I like to introduce you to United States mortgage.

Simply put, they are afraid focus mortgage team serving clients across the United States. They put together a team with Christian values with faith and family at the core. They know that this is arguably the most important purchase of your life. Check out the top five things you should know about United States mortgage@unitedfaithmortgage.com thanks to you and United for supporting the radio United for mortgages, a DBA of United mortgage Corp. 25 Millville Park Rd., Millville, NY license mortgage banker for licensing information, go to an MLS consumer access.org corporate MLS number 1330. Equal housing lender not licensed in Alaska, Hawaii, Georgia, Massachusetts, North Dakota, South Dakota and Utah. Most investors know that bonds make up part of a well diversified portfolio, but far fewer truly understand the important role bonds play in their financial future, and the way they can impact the world around West God calls us to be faithful stewards of all the resources he gives to us that means having a careful and intentional approach to our investments all talk about that with Benjamin Bailey of praxis mutual funds today and take your calls at 800-525-7000 800-525-7000. This is moneywise live where the Bible is our best financial advice. So I'm delighted to introduce Benjamin Bailey who is joining us for the first time Benjamin is VP of investments for praxis, mutual funds, a leading faith-based family of mutual funds and an underwriter of this program. Benjamin delighted to have you with us.

Thanks, Rob.

It's a real pleasure to be with you today.

Thank you. Will Benjamin I want to start today with the basics.

I like for you if you will to help our listeners understand fixed income investments and the important role they can play in securing our financial future. Yeah. Certainly so many people know about stocks and they understand how a stockholder has a partial ownership stake in a company. It's really no matter how small that is instead a bondholder receives the bond or promise to pay back from an issuer generally bonds.

I have a set coupon also known as an interest payment used to be more like 3 to 4% but now that interest payment seems to be more in the 1 to 2% narrator and it also has a final maturity date set a date in the future. We are going to get your money back so but these two things at a level of safety and clarity stockholder get the potential for big upside and also that big downside to get less safety while bondholders get a steadier stream of income in their protected.

On the downside, so that's what you get that more safety in your returns and plus in kind at worst case scenario where you have a bankruptcy, stockholders, and getting it anything back. While bondholders going to get something back so this downside protection and safety means that most investors will include some level bonds or bond mutual funds because they want that and especially as an investor gets close to a liquidity need like a retirement or paying for their kids college fund to move a higher portion of their portfolios to bonds you over the past 40 years.

Every time the S&P 500, which is the broad large-cap stock index has had a negative return.

Bonds have moved in opposite direction and had a positive return. So moving in that opposite direction. That's called negative correlation and that's a really important aspect of bond. So, you want things that move in opposite direction, especially during times of extreme stress. So back in March 2020.

Stock prices went lower bond prices went higher as those investors rest of safety and that's why bonds are such an important part of your portfolio. Yeah that's key here. We talk about bonds, often being that it will keep part as you set up a portfolio, especially as you move toward a more conservative posture moving toward as you said a liquidity need where your portfolio then becomes really income generating or just to stabilize the returns overall and so that's key now I praxis, though other factors are involved in how you actually select bonds for your praxis impact bond fund portfolio.

For example, is a part of your stewardship investing process so we got just about a minute before verse breaks out. I begin by telling us about a few of these other factors that play in their praxis. Yes, so going to the Bible in first Timothy 618 Paul says, tell them to use their money to do good. They should be right and good works and generous to those in need. So one aspect of using money to do good means paying attention to the impact of your investments to screen out certain companies that don't meet our clients values.

We also look at ESG so that stands for environmental, social and governance awareness screen out certain things like abortion and pornography tobacco but also to screen out some of those companies that have poor environmental records or poor policies with with their employees.

After that were to look at some that ESG information organ or try to bring more positive companies in the areas and making sure that we don't have company that are treating their employees poorly, but are really looking to really boost their employees. But the important thing that we've also been able to do over the last 10 years is we brought positive impact bonds into the portfolio were actually looking for bonds have a positive impact on creation and on our communities so we purchase of housing bonds and also bonds that help with the codependent. Those are important things I haven't portfolio also love it. Well I want to continue to unpack this and talk about how they performed financially alongside the values and impact perspective that plus much more with Benjamin Bailey today of praxis mutual fund stay with us will be right back. Back to moneywise live joining us for this segment of the broadcast Benjamin Bailey praxis mutual funds today were talking about bonds and the part that they play in a well diversified portfolio.

But not only that the impact that can be made through your bonds selections. How do you express your values with all of your investments, your stock selections and your bonds selections and Benjamin is helping us understand how the team of praxis mutual funds goes about selecting bonds for their praxis impact bond fund portfolio just before the break, Benjamin.

You were talking about the process where you apply values and actually screen out certain companies when making bond purchases because they conflict with Christian values or where you intentionally select other companies because they're making a positive impact in the world and I love that is fascinating to hear how we can actually make a difference in people's lives through our investments, which, as you said is ownership, but talk about the financial performance of that because it sounds incredible from an impact perspective but we also want to know that it's gonna performed financially. How have they done over the years. Yes, certainly I think that's important balance that eats the investments needs to bring into that the portfolio equation so these bonds they need to meet that same criteria that we have for return versus risks that we would get us anymore. Other investments I may have to be able to do that over the long-term.

And we've seen that that they have been able to do that over the long term, so 15 years ago were speaking just about these positive impact bonds are only 2% of our portfolio because there were a lot of options out there. 10 years ago they were 7% and now there 1/3 of our portfolio so we continue to find interesting investments all the time and want to grow this portion of the portfolio, but we still need to make sure that were outperforming the market.

One reason why we been able to grow this is that the offerings in the market have continued to increase dramatically this year so far. Just the first six months over $500 billion of impact bonds have been issued across the world as a 230% increase from just last year, so impact bonds.

We talk about impact bonds were generally thinking about green bonds social bonds sustainable bonds a talk about affordable housing earlier and those of been growing very quickly so other funds and our experience again is that these bonds are performed very well, just as well as any other bonds that we have. So if we know we can get a great return on God's money, and it can impact in the world. Why would we not want to be educated and intentional about selecting these types of investments. As you know, Benjamin. A lot of investors know equate bonds with Lori, might you say that fixed income investing can actually be powerful and transformational. So as we again go back to this idea that were stewards of God's money, and that includes our investments help us understand this aspect of bond investing in fixed income investing being powerful and transformational. Yes, it starts the recognition that God owns it all.

Right.

So in Psalms 24, it says the earth is the Lords and everything in it, the world and all who live in it so God owns it.

All right, so it is not ours to mess up or to be foolish with. I sometimes think about this with my kids. Yes, they are my sons, but I don't own them, and God has entrusted me with overseeing their growth and it's my job to make sure their well-functioning adults that let others and don't just care about themselves, not sometimes that is easier said than done, especially when you have teenagers on the need to how to make their own choices, but so similarly we are entrusted with our investments and we are stewards of that's why we call what we do stewardship investing so were stewards of the resources that God and trust us with. We can take some risk right need to take some, but we can't be foolish either.

And we need some level of safety in our portfolio and that's really what bonds offer.

Also in Matthew 25 talks about the parable of the talents and how were supposed to be productive stewards of God's gifts so the servant who received one talent and hid it in the ground was chastised by his master in verse 27 it says the master said, instead of hiding in the ground you should have deposited my money with the bankers and on my return I would received it back with interest that's essential like buying a bond right so we know it when you be productive stewards and everything, but we also also need to care for others. That's you, love your neighbor as yourself.

So it just isn't about us getting return. There's again that balance of getting a return but also thinking about our impact on the community and on creation so understanding this this balance of these things is really a transformational thing to an investor and an investor sees that a portion of the money that they need to save can go directly to make a positive impact in the world than this necessary and safe portion of their portfolio becomes a way to transform the world really Benjamin that's a powerful idea I want to drill down a bit more on that. Can you give us a more specific example. Or perhaps of what this real-world transformational impact looks like you talk generally about some ways that happens, but perhaps even more specific than that. Yeah. So Jesus says what we do to one of the least of these my brothers and sisters, you're doing it to me. So really, especially in the vesting that were doing were thinking about the least of these, and a lot of our investments in one good example for that is we've invested millions of dollars in the African development Bank.

Over the years and last year they borrowed $3 billion for their fight coded program and we were involved in that deal with African development Bank then lent some of that money to many different places including one of those places was they provided Morocco with over $400 million to strengthen their healthcare system. Some of that money went to buy 670 new intensive care beds and 30 new screening centers and sexy as help morocco to have one of the highest coded recovery rates in the world. So another exciting example is an eye bonds of that's EY i.e. in that stands for education use and employment so that I bonds. That was a bond for the Inter-American Development Bank in this bond invest in Latin America and the Caribbean and really in the lifecycle of kids from kids young age kids to young adults to make sure they get a good education and they have the skills necessary for a good job as they get older and so we know where some of that money went because they end up telling us where it went. So we know that 6.7 million of that went to Guatemala to improve education quality in the country and Bolivia got $15.4 million for their role well to live well program for early childhood development in Peru got 2.3 million to improve and expand their employment center services for formal job placement so these are real projects with real impacts in our market rate bond portfolio. This is fabulous bedroom. We have just about a minute left. Today I want you to finish today by drawing a contrast between the impact we can have through the bond market versus faith driven investment strategy involving stocks.

The what's the difference there.

Yes, so again many people understand shareholders and that they are shareholders in the when they're buying stocks and they can invest in businesses in the some people know about shareholder engagement and the impact you can have me do this at praxis. With our equity funds also but bondholders can engage companies in a different way because companies need to raise money when they needed to raise money lenders especially when they get together with other lenders can push towards better practices and better policies and to get enough of them together then and issuers are really gonna listen. Maybe it's improving that the depth of their impact bond or improving their level of transparency with people and companies need to borrow and investors can have an impact, and we've seen that with the with the issues that we purchased incredible well.

Who knew that the sleepy fixed income corner of your retirement portfolio could generate such transformational returns for the kingdom. This is been fabulous. Benjamin really appreciate you stopping by will look forward to having you back real soon as we talk about glorifying God through our investments and appreciate you talk about this impact can be had, absolutely Benjamin Bailey of praxis mutual funds is better yesterday. You can find out more@praxismutualfunds.com that's PRA X ISS mutual funds.com. Your goals are next. 800-525-7000 stay with us will be right back.

Thanks for joining us in moneywise. Rob was thinking your calls and questions on anything else was openly love to hear from 800-525-7000 525-7000 started today by talking about faith-based investing in particular faith-based investing in the bond base exciting developing space of investments where we can align our values with our company ownership in the form of stocks or bonds. As Benjamin Bailey pointed out today you'd like to know more about how you could perhaps have faith-based investments in your portfolio, you could connect with a certified kingdom advisor in your area on our website moneywise live.org just click find a CK all right phone lines are open today were going to begin to take your calls in just a moment.

Here's the number 800-525-7000. Whether it's saving your investing, perhaps faith-based investing or even preparing for retirement. Maybe it's college savings and how to best put money away for your kids or grandkids. Whatever's on your mind today we'd love to hear from you again the number 800-525-7000 were to begin today in St. Louis, Missouri Winnie, thank you for your call today. How can I help you area and get a company back to about look at this and know what you like best and how might bandits during that I really appreciate this program and one I learn anything. Yes. Well Winnie, it's a great question and there are ways to begin to step into this and I think the first question is what are your convictions yell. If it sounds like to me you want to have an alignment between your values and your investments in one way to do that is to seek out an investment professional who could help you understand the faith-based investing landscape. Somebody can help you navigate it because there are some wonderful fun families out there mutual fund families, many of which are underwriters of this program even tied praxis and inspire you heard from Benjamin Bailey of praxis mutual funds today.

These companies are doing incredible work, building investment portfolios in the form of mutual funds that are God honoring both in the way that they screen out certain companies that may conflict with Christian values, because of their primary business activities, or perhaps the way they use their corporate profits or screening and other companies that are having an impact in the world to promoting human flourishing. Even having a kingdom impact in the case of what Benjamin Bailey shared today, so I think that would be a great way for you to begin to explore that the other is related to proxy voting and you mentioned that we had a broadcast just a few days ago with Jerry Boyer, a good friend and economist Jerry was talking about how you can participate in these shareholder meetings that happen every quarter, and now because of the pandemic. There happening virtually and as a shareholder is an owner of the company you're going to get a 16 digit code that allows you to login and participate in any shareholder, no matter how many cheers you have can ask a question and what Jerry's been doing is participating in each of these meetings and raising questions where they may be supporting legislation that's its anti-religious liberty, or some other conflict. According to Christian values based on what the company is doing and just calling it out and saying I just need you to know is a shareholder. This is not something I agree with. Perhaps you don't understand fully the equality act or whatever it might be that you're raising and they will answer.

If they don't answer it on the call. They always answer every question in writing as a follow-up, but I think Tuesday Christians have the opportunity to make their voices know and express their values as is an owner of a particular company so that would be another way you could be engaged as a believer and make a positive difference in the world.

But does that make sense that Winnie only, that's great. I will listen to that broadcast with Jerry Boyer in and see what Jerry was talking about was was recently and then I would explore some of these other faith-based investing mutual fund families is perhaps additional investments to complement your portfolio or you could look for a certified kingdom advisor who has expertise in faith-based investing but I'm delighted you're thinking about this. I know it honors the Lord when we think deeply about how our faith impacts everyday life and we want to live with a Christian worldview and be salt and light in the world and certainly one way we can do that is through our investment.

So I appreciate your calling today and asking the question. If you have other questions along the way. Let us know on the Fort Lauderdale Florida Matthew. Thank you for holding today. How can I help you after I got out I wanted to know I lost you for just a second. Six state the question over again. Now I have a large sum of money invested in different and I am looking at retirement in the next three years.

When I say large Psalm on $850,000 on their high-yield stocks. A long history and that is done a better route for me to stay on that bit of quantity, mutual fund, yes, so you said you get to retire in three years you got up at 850,000 in all of that is fully invested in these dividend paying stocks yesterday and sorry I I made my all me to get back out about 15,000 stock and non-mutual fund, the rest of it is basically all you dividend stocks.

Where will you be relying on an income from this 850,000 to support yourself during retirement. Yes, off the dividend itself okay yeah I would be looking to diversify away. Clearly, dividend paying equities income stocks are generally more conservative. So I like the fact that you have a portfolio of high dividend yield yielding stocks versus let's say tech stocks, but it does sound like given your proximity to retirement due to highly concentrated in stocks in general, I'd have more in the fixed income space just because we got into a recession.

All stocks could see a decline in it could be a significant one, especially if you're relying on this for your income so that advisor who can diversify appreciate your call very much. Stay with us is that you join us today for moneywise like taking opposing questions on anything financial like the truth of God's word to today's financial decisions love to hear from you. 800-525-7000 got several lines open today 800-525-7000 Arco screeners are standing by will get you on the air quickly and look forward to hearing from you. Let's head back to what will actually to Cleveland, Ohio. Gwen is been waiting patiently. Hello Glenn how are you today absolutely. How can I help you out with like you put it where it I can certainly understand that and I would concur wholeheartedly.

I would use an online savings account with one of the online banks. Glenn, here's the benefit of that it's it is a bank so you are getting in FDIC insurance.

So given that you want this money protected. That would certainly be the case, they are going to allow you to do that without any fees so there's not community maintenance fees or anything that would cause you to have any kind of debit, month or quarter and they're gonna pay a little bit interest right now. The online banks are typically paying around half of 1%. Not a lot but it's something and it's very easy to link it to your checking account online. They have great websites. That way if you ever needed any of that money you could just transfer through the ACH system and with one to two days money would be right there in your checking account. No matter where you bank so I would open one of those online savings accounts and then you probably just want to the current custodian to send you a check and then you could deposit the funds I would use either capital one 360 Marcus or Ally Bank of those of the three that I like a lot in all three of those would pay the interest of describing and they wouldn't have any fees. Does that sound like what you're looking for a little more okay are they paying the interest rate they're paying okay. All right. Well, the these these online banks that I'm describing would pay about half of 1% so .05 so that would give you a little bit better interest rate, but I would compare him if you'd like to do some comparison shopping on the online banks. You can do that it mirrored wallet.com sounds like a silly name, but it they do a great job at reading the online banks but if you want to just go directly to one of the banks to compare to chase again. I look at Marcus. Marcus.com capital one 360 or Ally Bank but I think any one of those would give you what you're looking for and you wouldn't have any fees.

We appreciate your call today very much. Let's head to Illinois and the need to thank you for holding today. How can help you think so much for your service really do appreciate it.

We are looking to start putting money away hockey from 5 to 7 and want to know what would be a price on the base not yes that's a great question and I love the fact that you want to put money away the need. Have you thought about the purpose of these funds. Do you want these funds available for any reason for any purpose between now and and when they are young adults or would you like to allocate these funds specifically for something like college college would be ideal. Okay, yeah, if it is for college. I would look at a 529 savings plan, the benefit of the 529 is it's can act like a Roth IRA you not to get a deduction. When you put the money in, but the money is to grow tax-free in so as you invested in all of the 529's have investment options inside them, similar to a 401(k) the growth that occurs inside the account as you invested dollars would be tax-free growth. So long as it's used for qualified educational expenses while the other benefits is if one of your children doesn't go to college. She could be transferred to another child if they got a scholarship or grant you could pull the money out on a pro rata basis without any penalties so is a lot of flexibility there but it does need to be used for qualified educational expenses way to find the best 529 plan for you is to go to the website saving for college.com is a great tutorial.

There were you will answer a series of questions and those questions will then result in a recommendation of the very best. 529 plans for you. They will factor in a potential income estate income tax deduction by using the in-state plan in Illinois and compare the Illinois 529 two other states where the performance of the investments might be better and then give you a recommendation on what's best in your situation so that website again is saving for college.com and I think a 529 is what you're looking for is it make sense.

Thanks so much. Okay Vinnie thank you for your call sir. May the Lord bless you get some phone lines open today taking your calls and questions on anything financial here's number 800-525-7000 800-525-7000. David is in Minnesota. David can help. Now look at maybe my life with her job sometime in the near future. Here were wondering if we should take her retirement or get out now that her retirement, but just in case that she was at her job with the help when actually are paying a Bible not sure what to do. All right. Well I'm sorry to hear about the situation that David tell me a bit more about that when you say if she loses her job. We lose the house. Do you have some equity in the home could you go ahead and sell the home and buy something smaller that fits in your budget. We could sell the house but we just refinanced the binder windows and out so I don't make any equity that we just felt like about even maybe India having a savings of any kind to put down on the new home now. We don't get the paycheck. All right, all right. Well it sounds like the best thing to do might be to rent for a while rather than tried to pull money out of retirement plan to buy a piece of land you know I think what you will need to do right now is go into kind of a made a budget situation where you look at what income sources you have. Lord willing, she will lose her job if she does let's take your income let's build a new spending plan around that looking to cut every available discretionary expense that's possible. If you would gotta start with housing which would be a rent payment for maybe a townhome or an apartment or maybe a small single-family home and then food, then you gotta have no gas in the car to look for a new job and then you gotta have utilities and everything else is got on the table at that point we need to rebuild that spending plan around that, but I don't think given the uncertainty, the changes that are taking place in the prospect of losing this house we want to take a chance that this house could be foreclosed on because it's good to be a lot more expensive in the long run. I'd rather see you sell it, get out from under it satisfy the note completely, so you don't have a deficiency when it so perhaps at a discount and then let's just pray and trust the Lord for additional income.

Perhaps a new job for her. In the meantime, you can rent and that's good be the least expensive way for you to connect moneywise coaches on the website moneywise like they can help us plan together. They can do it is on the devilish joints today for moneywise line around West taking your questions on anything is holding in Indianapolis job is in Wayne, Illinois. Leslie is in Ohio. Leslie about 30 year mortgage or on 100 hundred 1004 6000 drop it down there about 1% and then redo it out of 30 year old are you guys keep trucking along at the 4% per I pay extra on my mortgage so what we do hold 26 years. I just don't know were $6000 to drop 1.9 yeah you would be buying that rate down, which is why those closing costs are so expensive.

What's the value of the mortgage right now. Leslie $40,000 hundred 1000 yeah I would be looking to spend only about 2%, 3%, the most in closing costs which would be about two to $3000. So you're spending quite a bit more than that. The other option I would consider is could you save a point because that would be what I would look be looking for one percentage point at a minimum. So for down to three as opposed to 1.9 and do it with a new 20 year mortgage which the payment will be a little bit higher, but you are descending more anyway. So if you could drop the interest rate by a full point actually decrease the term as opposed to increasing it back to a 30 year and get those closing costs down to 2000 3000 at the most I could get on board with that approach, but I don't like you restarting this mortgage because in the first 5 to 8 years. The vast majority that payments going interest in your current restarting that clock. Plus, that's quite a bit of money in closing costs that you would have to recoup before you even enjoy any of the savings from lower interest rate and especially if you're not planning to stay in this home for at least seven years. You may not even realize any of that savings. So what you think about looking for a new 20 year mortgage at 3% on my mortgage hundred and 90 my wife all mom. We have four children and single income and I like some flexibility where worse comes to worse I could take off that little extra bed at a 30 year that's what made us nervous about you, it's nice to have work my hours at work. It got worse comes to worse I could pull back that honor. Yeah sure I pay them on. Sure, almost like a Christian with my wife being a stay at home. Yeah, well, what you would need to do is you could look at a 25 year mortgage or a new 30 but you need to run the amortization schedule at that lower interest rate to determine exactly what the total interest is to be paid based on the extra hundred and $50.

You can send per month, but I don't like you spent $6000 just because it's gonna take quite a bit of time to recoup that. So let's take a look perhaps at a 25 or new 30 but you have to be committed to really sending extra. Otherwise, I'd probably just stay with what you have, but I certainly understand wanting that flexibility and not having the higher payment. If you need it.

So I think it's just to come down to what the total interest savings is and what you get a loan targeting 2% for the closing costs at 3% in the interest rate than they can tell you exactly what you pay over the life of the loan and interest in you can just compare that to your current mortgage. We appreciate your call today. Leslie very much, but let's head to Wayne, Illinois John, thank you for holding out can help you.

We got some come and do were wondering if we could put some of that money in a five-year fixed index annuity.

We will wonder what you thought it at yeah I'm not a huge fan of fixed index annuity is basically an insurance contract that provide you with income in retirement.

In your payments would be based on the returns of the either a stock market index, like the S&P 500 or some other index, the Dow Jones industrial average. So unlike direct investing in the market you're generally protected against losses, but you only get a portion of the upside, and you have to pay additional fees.

So I think the key would be just the complexity tying up your money where you wouldn't have access to the principal without paying surrender charges, and the other the limited upside in exchange for the downside protection is that really what you're looking for, so I think at the end of the day what you need to ask yourself is, are you willing to assume some risk with the investments that you take on, albeit perhaps a conservative amount of risk or are you wanting to transfer that risk to an insurance company and with the added fees in the complexity and the limited access to your funds. That's okay, because you're doing that in exchange for not having to bear the risk of the investments because you know that the money can't go down in value so tell me just your thoughts on that and and what you're ultimately looking to accomplish. We got money. We got a few other CDs so we chose a part in it at the party indexes to get a better rate.

We would go with a five-year one which we think the economy probably you think it is improving. Within five years that their goal beyond that and I think you be pretty close to what one and after 2% you would end up on those indexes, don't you think so well. It's just it's hard to say what what is the amount of money were talking about, and how does that compare to your total portfolio will be. We have say about 800,000 we would use like God say 50 80,000 okay are you using an investment advisor, John, or an investment to professional to help you with any of this note, we just start talking to some fellow that we met, Denise, said he runs a place that does financial advice in these investments to get what you want to guarantee that losing money yeah yeah and that's certainly true with the fixed indexed annuity in the sense that you would have that downside protection, but they tend to be very expensive and there's a lot of commissions that would likely be generated upon the sale of this insurance contract so I get a second or third opinion just to look at your overall picture and we trust the certified kingdom advisor designation. So what I would do is perhaps take a look at what you're being offered, but then visit with the CK there in Illinois who could look over it give you an objective opinion and perhaps even some other alternatives that wouldn't require you to tie up your money and perhaps would be less in the way of fees and expenses you could find a CK there in Illinois.

Just go to our website moneywise live.org and click find the CK.

We appreciate your call to Indianapolis, Indiana can. Thank you for your patience. How can I help you sir. How nature community can't 300 and just bank. I don't have any other wing of the line of 200 from Lori Easterbrook and that's my question. What are you looking for in the way of income. How much would you need to make ends meet. In addition to Social Security how to answer the letter. Do you have a spending plan.

Do you know what it takes to find your expenses on a monthly basis. Like I said I don't have any utility bills not stored okay that's good news because obviously you're living a modest lifestyle which means you wouldn't have to pull Holland out and you save quite a bit of money. What I would do. I mean, I think the key is, are you comfortable taking a modest amount of risk because what I would generally say is is a 70-year-old gentlemen looking to draw some income off of the $300,000 portfolio. I encourage you to seek out an investment professional that could build you a portfolio that is income producing. It would be very conservative in nature, it would probably be the majority of it in fixed income type investments a smaller portion in dividend paying stocks and other stocks, but where even if the market went down.

Let's say year or two from now.

We got into a recession. You wouldn't touch that portion of it, you let that you recover over time, but the goal would be that this portfolio could throw off as much as 4% a year which you wouldn't have to pull that out. But at least it would be growing, and if you needed to start drawing in income. The goal would be that should never touch the principal so that's 12,000 a year or thousand dollars a month and sounds like that's more than you need, just based on the expenses that you have doubt if you say to me, Rob, I don't want to take any risk. I don't know what ever open my portfolio and see that my 300,000 unit has declined well then that puts it in a different category. At that point we need to look at your other lower yielding investments. The problem is that interest rates are very low right now it's makes that very challenging.

As you know, you not getting much of anything to speak out. I assume in your local bank. So I guess the question would be, would you entertain sitting with an advisor who could build the kind of portfolio that I described you talk to okay what that would be my next step.

I cannot interview two or three there some wonderful certified kingdom advisors there in Indianapolis. Just go to our website moneywise live.org click find a CK but in your ZIP Code and you'll find a list of CK's there in Indy and I schedule some meetings.

Find out who you have a good rapport with who you know is a good match for you in terms of the way you communicate their experience and obviously the portfolio and strategy ploy to get moneywise live.org justifies for us today.

Folks moneywise live is a partnership between radio and moneywise you want to say thank you to Eric and Jim, I could do without him. Thank you for being you back on Monday all over again. Have a wonderful weekend


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