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Money Lessons for Kids

MoneyWise / Rob West and Steve Moore
The Truth Network Radio
September 2, 2021 5:02 pm

Money Lessons for Kids

MoneyWise / Rob West and Steve Moore

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September 2, 2021 5:02 pm

What are the most valuable things to teach children? Sharing the Gospel is obviously priceless. But teaching them to manage money God’s way is perhaps the next most valuable gift you can give them. On today's MoneyWise Live, host Rob West will talk about the importance of helping your kids learn what God’s Word has to say about money. Then he’ll answer your calls and questions about various financial matters.

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One listener that stands out that I worked with recently was this older couple that was interested in refinancing. They reached out to a few different lenders and you know their credit wasn't the best. I know some of these other bigger banks, you just won't hear back from them, which I cannot stand. Not everybody has the 780 credit scores and never had any hardships in their life.

I'll walk you through what you have to do. How can you end up being able to do this refinance, whether it's two, three, six months from now? Back to that older couple, we worked with them for months and months. to improve their credit. And we were able to get the loan done. We were saving them hundreds each month, thousands of dollars a year, finally got themselves into a situation financially that they can handle. And they could start saving money each month saving for retirement.

At the end of the day, they just could not be happier, which just put a huge smile on my face. We are United Faith Mortgage. Proverbs 22 six reads, train a child in the way he should go and when he is old, he will not turn from it. But what exactly should that training entail?

Hi, I'm Rob West. What are the most valuable things to teach children? Sharing the gospel is obviously priceless, but teaching them to manage money God's way is perhaps the next most valuable gift you can give them. I'll talk about that first today, then it's on to your calls at 800-525-7000 calls.

Call 24 7800-525-7000. This is MoneyWise Live biblical wisdom for your financial journey. Before we start, a few words to some of you who may be frustrated by this topic. Maybe no one taught you the wise use of money when you were young, and now you're struggling. So the idea of teaching biblical finance to your kids seems daunting. Let me encourage you, it's never too late to learn how God wants you to manage the rest of your life. The first thing you need to grasp is that he owns everything.

We're stewards. Second, you don't have to worry about money because God has promised to provide for your needs. Then, I'd recommend getting a copy of Howard Dayton's book, Your Money Counts. It's a great primer on biblical finances and very readable.

If your children are old enough, you can go through it together, learning and talking about the lessons at hand. as you go. Buy it wherever you buy your books. If you need help setting up a budget, download the new MoneyWise app.

It's free and uses the tried and true envelope system, so it's easy to set up. You can also sign up with one of our volunteer coaches at MoneyWiseLive.org. As you're doing these things, think of ways you can share your newfound knowledge with your children in a fun way. Now, let's dive into those lessons for your kids, and we'll keep things very practical. The first thing you want to teach them is a simple budgeting process. One-third for saving, one-third for giving, and one-third for spending. The idea is to teach them to manage their own money, and once they realize that money is limited, they'll learn to spend it more carefully. Encourage them to tithe and to put their own money in the collection plate. Encourage them to give something to missions and other ministries of their choosing.

The last part is very important. Guide them, but let them make their own decisions. As for the saving, well, that can be for a larger goal, like a video game or clothing. Some day, maybe for a car or even college.

Now, let's address where that money is coming from. Birthday and Christmas gifts from grandparents and other relatives are one source, but for the most part, it will have to come the old-fashioned way, by earning it. If you want to give them an allowance, that's okay, but attach some regular chores to it, like making their bed or helping with the dishes. Reward them with money, but also praise them for keeping their part of the agreement. If they fail to complete the assigned chores, calmly tell them that some or all of their allowance is withheld until the task is complete.

That's real-world experience. You can also set up a job list for the kids with dollar amounts specified for certain tasks. This is above and beyond the allowance. Rake the yard for so many dollars, that sort of thing.

The harder the work, the more it pays. Then let them choose what to do. Before long, you just might have a very hardworking youngster on your hands.

Now, let's look at some things you shouldn't do. Never reward whining or begging. That's a tough habit to break once a kid learns that it works. So if your child desperately wants something, set up a plan to earn and save for it. It'll be tough at first, but soon enough, most kids learn the system and do well with it. Remember that praise is as important as money. Encourage them along the way.

That takes care of the hands-on money lessons. Now let's turn to God's Word for important lessons on managing money wisely that you can share with your kids along the way, because Isaiah 54 says, All your children shall be taught by the Lord, and great shall be the peace of your children. The first I mentioned at the top, and it's from Philippians 4 19, and my God will supply every need of yours according to his riches in glory in Christ Jesus. God is our provider, and he will provide our needs.

He doesn't promise to give us everything we want. The next involves faithfulness. First Corinthians 4 2 teaches, Moreover, it is required of stewards that they be found trustworthy. It's often said that every financial decision is a spiritual decision. Use money wisely to glorify God. Next is the lesson about work. Second Thessalonians 3 10 for even when we were with you, we gave you this command. Those unwilling to work will not get to eat.

Obviously, we'll feed our children no matter what, but teach them the value of work and that all work is honorable. All right, that's all we have time for today. Your calls are next 800-525-7000. This is Rob West and we'll be right back. Thank you for tuning in to MoneyWise Live today. I'm Rob West, your host, and if you consider yourself a part of the MoneyWise family, the MoneyWise community, well, I want to make sure you know about our digital community. That's right, there's an opportunity to post questions, share encouragement, maybe even provide some answers to someone who has a question in our MoneyWise community.

You'll find it on our website. Just go to MoneyWiseLive.org and click community. When you create a free user account and you can post your own questions and comments and think of it as a community of stewards on a journey together to be found faithful, managing God's money.

As we do it together, I think we'll be better stewards along the way. There's also our community in the MoneyWise app, which you can download wherever you download apps. Just search for MoneyWise biblical finance. By the way, our coaches are in monitoring those community forums all the time. And so those trained volunteers are actually responding to your questions and they'll usually do it within a few hours. So if you have a question you're not able to get through on the program, consider checking out our MoneyWise community. I think you'll be blessed.

Again, MoneyWiseLive.org. All right, we're going to begin taking some phone calls today. We've got plenty of lines open and plenty of time to take your question. Whatever's on your mind today, here's the number, 800-525-7000. That's 800-525-7000. Call right now. We're going to begin today south in sunny Florida. And Loretta, thank you for calling today.

How can I help? Yes, sir. I have some repairs on my home, 10-15,000, and I was wondering if I should mortgage my home, which is paid off, or should I borrow it on an insurance life policy? Yeah. So roof repairs, obviously these are necessary. Loretta, do you have any savings that's liquid? No, sir, I don't.

Okay. And tell me about your income situation. Do you have enough to cover your bills and do you have a little bit left over, such that if you were to take out a small home equity loan that you could cover that payment and try to get that paid off in five years or so?

Right now, I'm not. I'm in my 80s and retired and just on a fixed income, so I really don't have... I may have a retirement of probably $10,000, but that's it for a savings. Okay. So are you living off of Social Security alone? I have a retirement. I'm a retired nurse, so I... Okay.

Yes, sir. Okay. And at the end of the month, do you usually have a couple of hundred dollars left over or do you spend everything that comes in? It mostly comes in for bills and there's not a lot left over.

Okay. Well, that would be my only concern. I mean, typically, I love the fact that your home's paid off. That's going to keep your lifestyle as lean as possible, allowing you to live off of that limited fixed income. And I would typically say, yeah, you could tap that home equity for a needed repair, probably a home equity loan, not a line of credit, getting a low fixed rate and get that paid back as quickly as you can. The only thing I certainly don't want to do is put you in a situation where you're taking on a loan, the payment is beyond the resources you have on a monthly basis, and now all of a sudden, this paid off home is in jeopardy.

Because if you can't make the payment, they'll come and foreclose on the home and we certainly don't want to go there. So I would only look at that home equity loan option if you were confident that you had the ability to cover that payment every month with the resources you have. Apart from that, we need to start looking at some other assets and you mentioned, I believe, an annuity that you could borrow from.

There's probably some cash value in there that's built up and that may be an option to look at. I mean, we certainly want to make sure that you don't cause any further damage to the home as a result of a leaky roof and certainly don't want to put you in harm's way by any means. So I think what needs to happen next, Loretta, is for you to connect with a certified kingdom advisor there in Florida, somebody who could just look over your policy, your annuity contract, and help you understand what the implications are and figure out, based on the retirement assets that you have, which one is best to pull from given any kind of expenses or fees that would be generated and any tax consequences so you can get that roof repaired. They could also help you look at that budget as well just to see if it might make sense, again, if you have the margin to do this using a small home equity loan.

One of those two options is going to be best, but if you think there's any reason you may not have enough to cover that mortgage payment, then I think we're going to need to look toward the retirement accounts to make sure the roof gets repaired and you don't add any monthly expense beyond your means. But I want a professional to look that over before you make that decision. So do you use the internet, Loretta? No, sir, I don't. I can get my children to. Okay, here's what I'd like to do. I'm going to have my producer, Amy, get your information, and we're going to have one of our coaches reach out to you just to help you explore your options. And if we need to connect you with somebody locally to review that annuity contract, we can certainly do that as well.

But you stay on the line. We'll get your phone number and have somebody get in touch with you, okay? Thank you so much for taking my time, and God bless you. Well, God bless you, Loretta. Thank you for calling. I appreciate so much your kind heart and your gracious words. And we'll see if we can help you get this squared away, and you have a wonderful day.

800-525-7000 is the number to call. We've got some lines open today. We're going to head to Illinois, or actually stay. No, we were in Florida, weren't we? We're going north.

WMBI. It's, I guess, LaShawn, is that right? Yes, that's correct. Very good.

Go right ahead. Okay, my question is, I have a 401k. They match like 4%, so I have like 10% in it. I was wondering if I should bump it up to maybe 11 or 12%.

Yeah. Tell me, if you don't mind, your age and kind of where you are in terms of your retirement savings. Do you have a pretty good understanding of what your ultimate goal is and whether you're on track for that?

No, I don't know if I'm on track or anything. I just... Okay.

Let me ask you this. What is your age, if you don't mind me asking? I'm 54. Okay, and what do you have in that 401k today?

Maybe, because I just started it in like last year or so. Okay, alright. So maybe 1500 or something.

Yeah, okay. So I think this is a great time for you, let's say over the next 10 years, or if you plan to work longer than that, great, 10 to 15 years, for you to put away as much as you can. Obviously, we want to max out, LaShawn, the matching portion, because that's free money. You're not going to get a guaranteed return like that anywhere else. But I think getting that number up as high as perhaps even 15%, if you can do it in your budget, I think would be a good thing, because we're playing a little bit of catch up here, where you're trying to put away as much as you can. Hopefully, these are your peak earning years, so that over the next 15 years, if you could be diligent in putting away somewhere between 12 and 15%, even though it's not being matched, the key would be that we've got as much as possible working for us. And here's the thing, LaShawn, that even if we were to get into a situation where we hit a speed bump in the economy, maybe we had a recession for a couple of years. As the market comes down, if you're systematic at continuing to contribute to that 401k, you're going to buy with the same contribution every month, the same 15%, you're going to buy more shares of whatever those investments are for the same amount of money. And as the market recovers, and at least historically speaking, it always has, no matter what problems we've encountered, and we've had some real significant problems along the way over the last 100 years, then you will see those accounts move to higher levels. So I would actually try to bump that up as much as to 15% if you can do it.

12 would certainly be fine as well, and I think you'll be glad you did once you get down the road and you're looking for this account to provide some income to supplement Social Security and whatever else you have. Does that make sense? Yes, thank you so much. God bless. Okay, LaShawn, thank you for calling.

I appreciate it today. Well, folks, that's what it's all about. We want to find God's heart and be good stewards of what he entrusts to us, however little or however much. We hear from folks that have an abundance. They have more than they need wanting to be found faithful, and others in a desperate, precarious spot wanting to just find a way to make ends meet.

No matter where we are, we want to be content, live with freedom, trust the Lord, not our things, and apply his wisdom. Phone lines are open, 800-525-7000. Call right now. Delighted to have you along with us today for MoneyWise Live!

Biblical wisdom for your financial decisions. I'm Rob West, your host. We have a couple of lines open if you'd like to get in today. We'd love to have you.

800-525-7000. We started today by talking about kids and specifically money lessons for our kids. We covered some great ones. You know, my heart is that as our kids leave the home, as future adults, that they would not only be financially literate to understand how a checking account works and how compound interest works for you as you invest and save and against you in the form of debt. You know, just a whole host of issues, why we should be hard workers, and really just how the financial system works. That's the financial literacy part. But even if we get that to them, so often they're leaving the home without an understanding of God's heart related to money. These biblical principles we talk about on MoneyWise Live! every day, starting with the fact that God owns it all, which makes them a steward, a manager of God's money, and that money itself is a tool. Yesterday on the program, our good friend Ron Blue said, Money is not stewardship. Money is the tool of stewardship. It's how we work out this role we have and our values and our priorities. And it's not the goal.

It's just a means to an end, and that end is most effective when it's something other than us. So we've got to teach them to give generously and hold it loosely and accept God's provision, to live with contentment, and to realize that if something's going to compete with God for first place in our lives, it's most often going to be money and the things that money can buy. These lessons are invaluable, so we've got to talk about them. We've got to model them, and we've got to find practical ways to instill these beliefs and principles into our kids.

So perhaps pick up a primer on this topic, maybe Howard Dayton's book, Your Money Counts, or Ron Blue's book, Master Your Money, and work through those principles with your kids, and they will be grateful. Maybe not right away, but certainly down the road. All right, let's head back to the phones today. In Danville, Indiana, is Pam, and we're so glad you've called today.

How can I help? Hi. I'd just like to know what your opinion is of real estate investment trusts, the REITs. And I know there's different types, and I would, one, know what you think the safest type category is. And also, I know if interest rates rise, it could affect them somewhat. How much could interest rates rise before they will be affected? And I'll listen.

Okay, very good. You know, I like real estate as an asset class in your portfolio. I wouldn't start there. I would say it's something to add after you have a base of stocks and bonds, because that's really, for most folks, at least historically speaking, has provided the most effective returns over the long haul with the least volatility, and it's a passive investment, which real estate investment trusts are, but direct real estate investments are not. So we have to recognize that, and I think as we diversify among our stocks, and then among stocks and bonds, a way to further diversify according to what Ecclesiastes tells us, is to move into other asset classes, and real estate would certainly be one of those. I don't think you should overweight in that area, especially with real estate investment trusts. I would be looking, Pam, to have an allocation to a REIT of somewhere between 5 and, at the most, 15% of your portfolio as a part of a well-balanced portfolio.

But I like them a lot. I mean, think of it as a mutual fund for real estate. You buy shares, the trust uses that money to buy and maintain real property. Any particular REIT, just like any particular investment, stock or bond, can be good or bad, depending upon, in this case, the skill and the decisions of the administrator, the manager of the REITs. There are two kinds, both traded and non-traded, and the non-traded type are very illiquid, meaning it could take several years or even longer for you to get your money out, whereas the traded REITs trade on the market, just like a stock, and they're making a market for you, which makes them very liquid to get your money back.

It's a simple business model. They purchase the property and lease it out, and then the property is rented, maintained, and upgraded as needed, and then 90% or more of the taxable profits are then passed on to the shareholders. They typically have very little appreciation, so you're not going to typically see a lot of movement in the underlying price of the REIT, but the real benefit comes as the profits are distributed to the shareholders as income. So, again, it can be a nice income base to the portfolio. I would recommend that if you don't have a real particular skill or expertise in this area that you talk to an advisor about managing the portfolio and talk about including real estate investment trust as a portion of that, but again, I would say no more than 5% to 15%. In terms of interest rates, real estate investment trust prices tend to rise along with real estate interest rates, and the reason is that a growing economy increases the value of the REIT because the value of their underlying real estate assets increase, and so if that's why the rates are increasing, then we typically see the real estate investment trusts go with them. In a slowing economy where the Fed is tightening money, the relationship typically turns negative. So, again, in any market and economy, you have some investments that are performing well, others that are not, and so it tends to balance out.

But overall, I would say, Pam, a real estate investment trust is a great addition to a portfolio, but I certainly wouldn't be highly concentrated there. I would just make it one small part. I hope that helps you. If you have other questions along the way, let us know. Well, folks, we have a lot of great questions coming up still to cover on the program. We're going to be talking about credit cards and whether you should consolidate or use a debt management program. We'll be talking about scams related to paying off a home and having a mortgage that's paid off. Andrea wants to know about that.

Jennifer wants to talk about whether this is a good time to put an inheritance into the stock market. That and perhaps your question just around the corner. We've got one line open, 800-525-7000. By the way, if you haven't checked out our brand new website, let me encourage you to do that. We've got great content, our communities there. Access our app and broadcast archives. MoneyWiseLive.org.

Stay with us. Thank you for joining us on MoneyWise Live today. I'm Rob West, your host. Hey, if you consider yourself part of the MoneyWise family, would you consider supporting the work we do here at MoneyWise each day? Beyond the giving to your local church, we rely on our listeners to support our ministry activities. Our website, our app, our coaches, our CKAs, not to mention this daily broadcast. You can give safely and securely.

By the way, it's quick too. Just head over to our website, MoneyWiseLive.org and you can click the donate button and we would certainly be grateful. We have some great questions lined up. Every line is full, so let's dive right in. Miss again, Jennifer's calling. Jennifer, good afternoon to you. Hi there.

Hi. I'm calling because my husband and I are on the verge within a couple of days actually of receiving a large cash inheritance. It's about three quarters of a million dollars and we're just not quite sure. People have been talking to us about how this is where coming to the end of a bull market and so I just am really questioning, is it the right time to take that kind of money and put it into the stock market? So I don't want to see it go in and then in a year have it all plummet. Do you know what I'm asking? I totally understand.

Yeah. And I think as you approach this obviously unique season where you're going to be all of a sudden managing a significant sum of money, perhaps more than you've ever had to deal with or maybe not, it's still something you need to approach very carefully and prayerfully as well, just to think about what God would have you to do with these resources and the way of giving and investing and should you pay off any debt that you have or just save it all for the future. So these are important considerations and ones, Jennifer, that I would probably take up with the counsel of a professional, somebody who can walk alongside you, a third party to give you some godly and wise financial counsel along the way. But at the heart of your question is a good one and that is, yeah, we're 12 years into a raging bull market, the last two years have been unbelievable, the quickest plummet into a recession in history and then the quickest climb out and of course we've moved to new highs. We just hit another one last week on the S&P 500. So where does the market go from here? Well, the best experts that I talk to say that probably the best word to describe the market moving forward over the next 12 to 18 months is choppy, meaning we're not going to go straight up from here, we just are so high and yet there's a raging economy that's very strong underneath everything and even though we have some challenges to deal with, some speed bumps that we'll have along the way in the name of debt that we've taken on as a country and rising inflation that at least the Fed says is probably going to be short-lived, we'll see, but all of that could result in us having a recession at some point down the road and we're going to have to deal with some of these things. But does that mean that you should stay out of the market?

I don't think so. I think you just need to be wise about how you move into it. It could be that you begin to move this money into the market in phases. So perhaps a tranche goes in right up front and then you systematically invest it over a period of 6 or 12 months. The other thing you can look at is just based on what your needs are and what you set as your ultimate financial finish line will help you determine how much risk you need to take right now because the goal is not just to get as much return as possible because with that comes an excessive potentially amount of risk with that and you may find yourselves given the sum of money you're receiving that you say, you know what, we want to be more conservative. We don't want to move it all into stocks and so that would be another way just to begin to work your way into the market but do it in a way that is a bit more conservative. Again, that's all going to be tied to your goals and objectives and your needs down the road. So I would say in terms of where to put this money given that if we don't put it anywhere and you kind of put it under the proverbial mattress, although that would be difficult with this amount of money, you're going to lose purchasing power because especially right now we've got inflation which means these dollars are less valuable than they will be in the year from now than they are today and I think the stock market with a prudent disciplined strategy is going to be the very best place to be but it doesn't mean you throw caution to the wind either. So I know I'm not giving you concrete specifics on where you go from here but I would say that a properly diversified stock and bond portfolio that's tied to your goals and objectives even at this stage in the cycle we find ourselves in economically and from a market standpoint is still the right place to be.

The question is just how quickly you move it in and what investments you choose. Let me ask you this, Jennifer, are you all planning to manage this yourself or do you have a trusted advisor? We've met with three different advisors and have chosen one that we feel comfortable with. How has he or she described how they're going to approach moving into the market? They've described it and they will approach it at whatever comfort level we're comfortable with. We felt like we were more aggressive and now that we've actually gotten the money and done a little more research we don't think we're as aggressive as we used to think we were. Well, good to realize that now and you can always get more aggressive down the road. You guys I suspect still have quite a bit of time between now and retirement, is that right? Yes. We're early 40s.

Okay, great. So you've got plenty of time. So here's the thing, Jennifer, even if you're buying at the very high for the next two years and you're not.

But let's say you were, right? As long as your time horizon is 20 years and as long as you understand the risk you're taking and you're willing to weather that storm, even if you were 100% allocated to stocks, what I would say is you need to be able to weather opening a statement and seeing that portfolio down 30 to 35%. Now that's if you're 100% in stocks. If you were to start to diversify out of stocks into other types of investments that are more stable, more conservative fixed income type investments, then that begins to lessen that volatility and so even if the stock market was down considerably you might be down 20 or 25%. That's a lot of money but keep in mind you're in it for the long haul and you're not buying at the top because you're not going to put it all in on one day and you know the market is still very strong right now because the economy is very strong.

So I would say be prudent, be prayed up, you've done your due diligence on selecting an advisor and I think as you express some of these concerns you've described to me today, the two of you can work together to make sure that you're going into the market, whether that's stocks or bonds or a combination of the two in an appropriate way so you're not taking unnecessary risk. Does that make sense? That does. Thank you so much. I so appreciate your advice. Happy to do it Jennifer.

All the best to you and your husband and if you have other questions along the way, give us a call. Let's see, I've got just another minute before the next break. Let's quickly go to Tampa, Florida. Tom, good afternoon sir. Hi, how are you? Doing great. Yeah, my question is I'm almost 60 years old. I don't have much saved up.

I've got about 20,000 saved up and about 20 something thousand in 401k and I need to get some advice on how to best manage money and get prepared for retirement in five or six years. Okay, yeah very good. Well, we're going to take a break here in a second and I'm going to give you my thoughts on the other side of the break but just a quick question.

So in terms of retirement assets, the 20,000 is the extent of that plus the savings of another 20. Is that right? Yes. Okay, very good. And do you have a budget worked out, a retirement budget so you know what your expenses are going to be in that season? No, I don't. Right now I'm renting.

I don't own but I would like to buy. Yeah, very good. Well listen, you hang on the line. We're going to take a quick break. When we come back, I'll give you my thoughts just on the other side. Stay with us. This is MoneyWise Live. We'll be right back. This is MoneyWise Live.

I'm Rob West. This is the program where we recognize God owns it all. We're stewards. So money is a tool to accomplish his purposes. How can we be found faithful?

That's the question. Just before the break, we were talking to our friend Tom in Tampa, Florida. Tom's nearly 60 years old, has limited retirement funds, about 20,000 in cash and a reserve account, 20,000 in a 401k. And just wondering how does he proceed financially at this stage of life? And Tom, just before the break, I was asking about your budget because with limited resources, it's even more important.

It's always important. But even more important to understand what your outgo looks like because your expenses on a monthly basis now and perhaps if they're going to change in that retirement season of life because you're no longer contributing to a 401k and you are able to dial back some other expenses potentially. You need to know what that monthly need is and then of course we need to compare that to the income sources you're going to have. Namely social security.

So you're going to want to have a clear understanding of what you're going to receive at every step along the way. And obviously in your situation, you're going to want to try to wait until full retirement age, if not to age 70 because that's going to get that check up as high as it can possibly be. And then whatever you can save between now and then becomes an asset that we can convert into an income stream to supplement that social security. And the goal would be that that income stream we can pull out, perhaps maybe 4% a year ideally would be such that you'd never impact the principal and that plus your social security would cover your monthly expenses. If that's not the case, then we either have to work longer or find ways to reduce expenses. So I think that's really your next step is between now and retirement to save as much as you can which means you've got to have as modest a lifestyle as possible and looking to trim expenses wherever you can right now. And that means you've got to get that budget in place so you can analyze where your spending is going. But then maximizing what you're putting away so that you can convert that into a supplemental income stream down the road. But give me your thoughts and are there other specific concerns I haven't addressed? Well, where would I get the supplemental income streams?

What's a good... I don't have any investment ability. Yeah, well, I think the key here is how long you're going to plan to continue to work. So if you have good health and the Lord tarries, would you see yourself working another 10 years?

Yeah, I'm going to have to, I think. Yeah, so what I'm saying is that that $20,000 that you have today, if you can try to go back to the budget right now, look for ways to increase your margin, cut expenses so that you can put away as much as possible on a systematic basis into that 401k through salary deferral over the next decade. Let's grow that $20,000 to, you know, let's say $100,000 or $150,000 if you can, and then all of a sudden, you know, that at 4% a year is going to throw off, you know, an extra $500 a month. And hopefully that plus the Social Security, and that would be managed by an investment advisor, that $500 plus Social Security hopefully covers your lifestyle need. I mean, that would be ideal because then we'd never touch that $150,000 and it would just continue to throw off some income. But if that's not enough, then I think that's where we have to either work a bit longer, get a part time job in that season of life, or you're going to have to pull out such an amount that you would be, you know, draining that account over time and at some point you would deplete that, you know, which becomes problematic.

Do you follow? Where do I find an advisor? Yeah, well, I think, I mean, the challenge is that with $20,000, you're probably below and it's in a 401k.

So it means you have a very limited universe of investments. So what I would probably be looking to do is either connect with an advisor like a certified kingdom advisor in Tampa. You can find one on our website, MoneyWiseLive.org.

Click find a CKA and search by zip code. What you would do is you would pay that individual probably once a year for a few hours of their time just to look over your investment options inside the 401k and tell you which funds to pick based on where you're at. The key is that once you get those investments set, you just leave it and you just contribute as much as you can every month systematically, whether the market's up or down, you keep putting it in and let's let it grow for the next decade.

Then when you roll it out to an IRA, when you're 70 or 72, whenever that is, then you'd hire an investment advisor to take discretion over that money with your goals and objectives in mind, probably to be conservative and generate an income, and they would then invest that for you making those decisions. But that's down the road. Do you follow? Yes, sir, I do. Thank you. Okay. You're very welcome.

I think the key right now is let's dial back your expenses, get as much as you can going into that 401k, find somebody to make sure you're in the right funds for you inside that 401k, and then let's trust the Lord for the balance. And if you have other questions along the way, give us a call to Chicago, Illinois. John, thank you for calling. How can I help you? Hey, how are you, Rob? Great.

Yes, sir. You know, I actually, I heard your radio station, and I listen to 90.1 all the time, and you guys are very uplifting, and I just want to say thank you. You know, sometimes when I feel like I'm in the dirt and I hear your show, you listen to me up like the Phoenix, man. Well, we all need encouragement along the way, John, and so we're here for one another, but thank you for those kind words.

How can I help you? Well, on your Money Wise segment, I heard you're talking about debt and all this stuff, and I have multiple credit cards equaling, I don't know, about $20,000, $30,000. And, you know, I could, you know, just figure out a way to pay it all off, but, you know, I don't know if that's the right move because $30,000 is a lot of money, and I paid one time $30,000, and I had a $30,000 credit limit. And then, after that, they pulled me down to $10,000 after I had already put $10,000 back on, which is hurting my credit now. So, it's like, you know, you try to pay the bankers back, but then, at the end of the day, you know, they tell you, here, take it like this.

Yeah. Well, John, I think the key here is, and I certainly understand where you're coming from, we've got to solve the problem, not the symptom. So, at the core of all of this, for all of us, I'm not talking to you, I'm talking to myself and everyone else that's listening, is living within our means. So, we've got to have a plan, which means we've got to have a budget, we've got to know what our expenses are, what's coming in, what's going out, and make sure we're living beneath that. So, after the, you know, our giving comes out, and after our taxes are paid, and any insurance payments that might be deducted from your paycheck, what's left over, your net spendable income, we've got to have a plan for that to cover the bills, the discretionary expenses, and have a little bit left over so we can, you know, pursue our goals, namely, in your case, getting out of debt. But that means we've got to limit our lifestyle and not live beyond our means, even if somebody will lend us money to allow us to do that.

Once we've solved that and demonstrated we're able to be disciplined and live in that way, now we can go after the problem. So, how do we attack this debt? Well, my favorite approach to this, John, is something called debt management, not a consolidation loan where you go out and get a new loan, because usually that treats the symptom and then the credit cards come back and then we have the consolidation loan on top of it. With debt management, the credit cards are closed, the interest rates are reduced, you get one fixed monthly payment that fits into your budget, and you're typically going to pay these credit cards off 80% faster because of the level payment and the reduction in the interest rates. The cards will be closed, so you have to accept that, but it'll help you get out of debt once and for all. I want you to visit with my friends at ChristianCreditCounselors.org. Christian Credit Counselors, they're really a trusted source of wisdom, and they'll be the ones that will handle this for you, and I think you'll be thrilled at how it goes.

So ChristianCreditCounselors.org, they'll tell you exactly how it works and get you set up on a program if it makes sense for you. And John, we appreciate your call today. All the best to you, sir.

We're going to finish today in Orlando, Florida. Andrea, thank you for your call. How can I help? Hi, I have a low mortgage payment that I need to pay off or want to pay off, but I've heard that there are scams out there where if you have no balance on your home, people can come in and quick feed or do something to take your home away. And someone suggested taking out a line of credit, but I'm wondering, is there alternative ways to protect my property? Yeah, Andrea, I'm not concerned about you paying off the home.

In fact, I would absolutely do it and not look back. You know, any kind of scams that you're hearing about regarding a quick claim deed really don't have anything to do with whether you own the home free and clear or you have a mortgage on it. It has everything to do with, and it's been getting a lot of press lately, a scam involving your title where somebody goes into a county deed office and forges your signature on a deed transfer to another party. And while that can present some legal entanglements, I guess you could say, it would ultimately be thrown out in court because it's forgery. And there are services out there to monitor your deed status.

They charge typically about $15 a month. But here's the thing, they call them title lock or title insurance, not the typical title insurance, but title theft insurance. They can't lock your title, as some of the ads might imply.

You can protect yourself for free by periodically checking your property record on the website of your county's register of deeds. So, you know, this is not something you need to pay for. And even if it was to occur, you'd be able to unwind it because they would have signed this property over fraudulently, which, you know, nobody can prevent fraud from taking place.

But ultimately, it would be handled in a court. But that has nothing to do with whether or not you pay off this mortgage and you're free and clear. So I wouldn't pay one extra ounce of debt or interest, then you absolutely have to. In fact, I'd pay off that loan and not look back.

And anything that would be happening or could happen, you know, related to somebody trying to fraudulently sign your title away from you has nothing to do with whether you have a balance on your mortgage. Does that make sense? Yes, it does. Thank you very much. All right. Listen, congratulations on being so close to being debt-free. I'm really excited for you. I know that'll be a real blessing.

Give you a lot of freedom and peace of mind. You'll probably even sleep a little better at night. So Andrea, thank you for being so patient today. I know you've been holding a while. We appreciate your call. Well, folks, that's going to do it for us today. So thankful that you were along with us on the ride today. Let me say thank you to my team, Deb Solomon producing today, the amazing Amy Rios Engineering, Mr. Jim Henry providing research, and I believe Eric or Gabby were answering the phones today.

Whoever it was, we're grateful for both of them. I want to thank you for being here with us today as well. Come back and join us tomorrow, will you? We'll apply God's truth to your financial situation. That's what we do every day on Money Wise Live. This is a partnership between Moody Radio and Money Wise Media. God bless you. Bye-bye.
Whisper: medium.en / 2023-09-03 04:45:42 / 2023-09-03 05:03:18 / 18

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