Today's version of MoneyWise Live is pre-recorded, so our phone lines are not open.
Colossians 2.8 warns, See to it that no one takes you captive by philosophy and empty deceit, according to human tradition, according to the elemental spirits of the world, and not according to Christ. Hi, I'm Rob West. Our view of the world shapes our lives, especially how we manage money. I'll talk about that today first with Paul David Tripp, and we have some great calls lined up, but we won't be taking your live calls today because we're pre-recorded. This is MoneyWise Live, biblical wisdom for your financial decisions. Well, our guest today is Pastor Paul David Tripp. He's the author of more than 30 books and videos on Christian living, and one of his most recent is Redeeming Money, How God Reveals and Re-Orients Our Heart. Paul, welcome to the program. Thank you.
It's great to be with you. Well, I've got to tell you, I've been reading your books for a long time, and then all of a sudden out of nowhere, I was so excited to see one on money, and it's deeply impacted me. I would go as far as to say everyone listening to this program needs to read this book because, Paul, you've hit on something that I've talked about for a long, long time, and that is money issues are heart issues.
And if you don't understand that, if you don't begin there, you've missed it according to God's word. Is that really one of the key things that led you to write this? Absolutely. It's money problems are not actually money problems. They're heart problems that reveal themselves as money problems. So, yeah, that's it.
Yeah. The late Larry Burkett used to say money is the clearest indicator or the way we handle it into what's going on in someone's life spiritually, because how we handle our money reveals what we value, where we've placed our trust. It tells us what's important to us.
And so we have to begin there. And I know you talk a lot about identity. What is it about identity and money that we need to understand? So the Bible assigns to us these four identities, creature, sinner, suffer, saint. They have everything to do with money.
Let's start with creature. Money really does define how you think about who you are. Sinner, where does your use of money expose your need for heart change? Suffer, where's your evidence in your use of money that, I mean, you doubt the goodness of God, you've taken your money life into your own hands. And then saint, how has your money life been shaped by the blessing of knowing that you're one of God's saints, you're one of God's children? So in some way, you're always living in your money world out of those four identities, whether you know it or not.
Yeah. And that's a really big idea, which also says, Paul, that, you know, fixing our money problems, if we're in a money mess. Yeah, we need a budget, but it's so much bigger than that. And it really has to begin with our heart because we can't solve these problems related to money with more money, right? Well, that's the mistake of a lot of the emphasis of money, even Christian emphasis of money. If the rules of a budget could solve your money problems, Jesus would have never had to come. The cross teaches us there's something deeper that's broken. And unless I get at that, I won't solve my money problems.
Yeah, that's exactly right. So how would you then articulate as you've read the Council of Scripture and meditated on these literally thousands of passages that deal with money and possessions, how would you articulate that a biblical worldview of money? So, you know, there are four things that I think are just so important to let shape the way you approach money. One is in the center of the world is this God of uncalculable glory. The glory I was meant to live for is not the glory of physical things, not the glory of the amount of treasure in the bank, but for the glory of God.
That just changes everything. Yes, the Bible tells us also that the world is terribly broken by sin, that sin is deceitful and seductive and controlling. And so one of the ways that that money gets us in trouble is it becomes an idol for us that distorts the way we live. We also know that God offers us his amazing life transforming grace. So I don't have to hide my money problems.
I can come to him and confess those. And then finally, we're called to live for something bigger than our own pleasure. We're called to live for God's kingdom.
And all those things change the way that you approach this thing called money. Paul David Tripp is our guest today. His book is called Redeeming Money, How God Reveals and Reorients Our Hearts. More to come just after this break.
Stay with us. Thanks for joining us today on MoneyWise Live. Our guest today is Paul David Tripp, author of Redeeming Money, How God Reveals and Reorients Our Hearts. And Paul's really offering some fresh insights about how we should view and handle God's money. And I'll tell you, this book has deeply impacted me. I would say everyone needs to read it. And in fact, we believe that so strongly we're making it available as a gift from MoneyWise with every donation of at least $25 between now and December 31st.
Just go to MoneyWiseLive.org and click the donate button. And again, we'll get a copy of this book right out to you. Paul, just before the break, we were talking about this idea of money being so connected to our hearts. And really, if we understand a biblical worldview, it changes how we view and handle God's money. You encountered a passage in Ephesians that you believe changed everything for you. And I'd love for you to unpack that a bit for us today.
So if I could start with a helicopter view first. The Bible is the world's best generosity story. God's generosity is on every page of scripture.
It could be summarized by nine words, for God so loved the world that he gave. You don't understand the biblical story unless you understand it's a generosity story. And that comes down to the way that we think about our work and our money. Ephesians 4 28 says this, let the thief steal no longer, but rather let him labor doing honest work with his own hands. Now, I would expect that it would say next so that he can provide for himself and his family. But that's not what it says next. Doing honest work with his own hands.
Now check this out. So that he may have something to share with anyone in need. Paul is saying the purpose for your money is not first to provide for you and your family. The purpose for your money first, the primary purpose is so that you can be part of God's grand generosity agenda. That just changes everything.
It really does. And I think it's such a critical and foundational idea that you've hit on here, Paul, because we tend to start there with provision. The challenge is when we begin with provision, we can end up with an endless list of needs and wants that never allows us to move beyond that into generosity, which you said is clearly at the heart of what God wants for us. And that's exactly why Paul says what he says.
He's flipping the game on us. Here's Scott's plan. God makes his invisible generosity visible by sending generous people to give generously to people who need generosity. Well, there it is.
Yeah. And so immediately once I'm his child, I'm an ambassador then of his generosity. That's the purpose of the money that he puts in my hands primarily. And he has promised as I give myself that generosity mission, he will provide for me. Matthew 6 says we have a Heavenly Father who knows what we need. That's good for us because we, let's admit it, we get needs and wants confused all the time.
Well, we sure do. And I love what you're talking about here related to God's generosity story. You know, we talk a lot about the fact that if something's going to compete with the Lord for first position in our lives, it's most often, we see in Scripture, going to be money. You cannot serve both God and money.
When we look at the parable of the sower, the way I read it, two and a half, maybe out of the three reasons Jesus gives for the word being choked out was the cares of this world, the deceitfulness of riches, the desires for other things. And what we also understand is that giving generosity is what calibrates our hearts to the ultimate giver. And it literally breaks the grip of money over our lives as you process the opportunity to participate in God's activity through giving. Paul, what do you believe that act does to our hearts that really changes everything about how we view our money? Well, you know, the thing that we all struggle with, Paul says, is that we live for ourselves.
Jesus came, he says, so that we would no longer live for ourselves is the selfishness of sin. I'm an endless vat of wants and needs and feelings. And it's so hard for me to get beyond me. Yeah. And so when God gives me a grander, greater vision, he's not just taking money from me.
This is so important in love. He's liberating me from my bondage to me. Yes. And that's the best way to live because I was I was created to live for something bigger than me. And when I do that, there's contentment and satisfaction and joy that you won't find any other way. So a call to generosity is actually a welcome to the good life.
It sure is. Paul, I know you've written a lot on marriage and relationships. Let's apply this to the marriage relationship, because, you know, when we hear from folks on this program that say we've got a breakdown in communication over money, it's not working. And we then step back and say, first and foremost, this is a heart issue and you need to get a vision for where God is taking you as a couple and see money as a tool to accomplish that.
It changes everything. Take everything you just described about money in our hearts and apply it then to how we need to interact as a married couple. Well, I think this is what we're talking about right now is the only solution, because often what you have is this endless debate between two different purposes for money. Wife says, this is the way I think about our money.
Husband says, this is the way I think about our money. And they don't have a higher agenda to solve the debate. And so it's just an endless, endless battle. And it begins to break down their love and their intimacy with one another. When I say that there's a bigger agenda, there's this generosity agenda, then there's something both of us can sign on to, both of us can submit to. There's a greater, deeper level of unity that we can enjoy that then allows us to be on the same page in the way that we think about our use of money and budget, our needs and the greater needs that God has called us to be involved with. Yeah. Well, that's exactly right, because it does, in fact, then change everything.
It's no longer about I get to do this and you get to do that. It's about what is God doing in our lives and how can this tool of money be aligned with his purposes for us to be able to be connected to God's activity in the world? I love this visual, Paul, of not being a bucket where God's provision stops with us, but in fact being a pipeline where we're connected into God's activity, which is where real joy is found, right?
Absolutely. It's just our Lord wants us to thrive. He loves us. And so this is a thriving life. As much as we think that keeping it all and spinning on us is the good life, it's not the good life. And so I think one of the things I want to say is that you have to understand that the money in your pocket is a visual picture of a spiritual warfare that's taking place in your heart. Where is that war taking you?
What lives in control of your heart? Who's winning that battle of who will set the agenda for your life and who won't? And every time you look at a dollar, you ought to think, God, am I surrendering not just this dollar, but everything in my life to the greater, better agenda that you have for me? Wow, that is powerful.
Unfortunately, we're out of time, but we're going to have to have you back to talk more about this. Paul, thank you for some refreshingly wonderful insights about how we should view and handle our money. God bless you, sir. Thank you.
It's so much fun to be with you. Our guest has been Pastor Paul David Tripp, author of Redeeming Money How God Reveals and Reorients Our Hearts. You can get a copy with a minimum donation of $25 to MoneyWise from now until December 31st.
Just click donate when you visit MoneyWiseLive.org. Today's program is prerecorded, so keep that in mind when you hear phone numbers. We're going to pause for a brief break now, but Rob West will be back in a moment with more MoneyWise Live.
Welcome back to MoneyWise Live, God's wisdom for your financial decisions. I'm Rob West. We're delighted to have you along with us today. Hey, our team is taking some time off today, so we're prerecorded, so I would encourage you not to call in. However, we have some calls that we've lined up in advance that I know you'll enjoy, beginning with Sue in Chicago. Hello, Sue. How can I help you today?
Thanks, Rob. My 32nd question is about money for my daughter starting grad school next month. We are a God-honoring family, which includes our finances, and my daughter will be starting grad school and receiving an unsubsidized loan for grad school, but she'll still be short in covering her expenses. So I don't want to cover or remove her financial responsibility, but I'm wondering if I should encourage her to borrow from me versus take out other loans like a grad plus at 6%, and that could really benefit her to borrow from me as she works her life out for the Lord.
But I'm just not sure what to do. As a widow, a 61-year-old, I have no steady income, but I do have a house paid for and a cottage, and I do have quite a bit of money invested that could help her. Yes, okay.
Would these be assets that you would not need if for some reason she was unable to pay this money back? That's true. That is correct? Yes.
Okay. Yeah, you know, I think as you go into this, you would just kind of need to make some key decisions in your mind and then talk it through with her. I generally discourage folks from lending to family members, and certainly that would include a child, unless you're ready, willing, and able to forgive the note at any point if it's required.
And here's why. You know, we see in the Bible that the relationship changes when you become a lender and a borrower. It says the borrower is servant to the lender, which means the borrower is the lender slave, in a sense. And so, you know, there's a relationship that changes there as you go from mother-daughter to lender-borrower. And it has the real potential to cause a strained relationship if even, you know, if everyone goes into it with the best of intentions and she's unable to get the job she wants, the Lord redirects her into something outside of the field she's been studying for that is not going to earn anywhere near the amount of money, and so therefore she's not able to pay it back. And, you know, so you get into those situations and collateral damage in a relationship is not worth any amount of money. And so that's why I would just err on the side of just, you know, passing, even if it's going to cost her more in the long run. Now, if you were to say to me, Rob, I think this can be a blessing to her. I have the financial wherewithal to do it, even if I had to forgive the loan, and I'm ready, willing, and able to do so under the right terms and conditions or situations. And there's a real healthy communication and dialogue about that on the front end so that there's not even, you know, guilt on her part if that were to have to happen because she knows it going into it. You know, these are the conditions under which I would only, you know, be, you know, at all comfortable with you doing this. Does that make sense though, Sue?
Yes. Does it help at all to say, okay, I'll charge you a minimal amount of interest so that we consider it a financial deal? Yeah, you certainly could, and you'd want to have all that in writing ahead of time so there's not any kind of, you know, misunderstanding as you go into it. But what I think is more important than her feeling like, well, I've taken advantage of mom because I can see her just, you know, seeing you as wanting to help and being really grateful for that. We've got to think about the worst case scenario and deal with that first, and that worst case scenario is she's just unable to pay it back anytime soon. And, you know, we're 10 years down the road and she's still working on the other debt that, you know, has real lenders that are not related to her and she hasn't been able to touch yours. And she had told you she was going to plan to start to pay it back and she hasn't been able to. And, you know, again, it could be for any number of reasons.
And then all of a sudden now we've got, you know, potential conflict between a relationship and it's just not worth it. So I think that's where you need to go into it saying, I have the ability and I'm willing to forgive this if it comes to that because I'm not willing to allow this to come between us. Do you follow? OK. Yes. Thank you.
Yeah. So I think as long as you wrestle through that and then based on what you've decided, you all sit down and have an open and honest conversation about it, and then whatever is decided is then reduced to writing that you both kind of agree to. So there's no unmet expectations or potential conflict, then I think that's then the position that would allow you to move forward and do something that would be a real blessing to her, but with proper understanding so that we elevate the relationship above the financial situation. And we appreciate your call today. Let us know how it turns out. We'll certainly be praying that God will work in that situation. Roberts in Pennsylvania. Robert, we have just about a minute left.
How can I help you? Yeah. Just a real quick question. How do you know when a vehicle is nickel and diming you to death as far as the maintenance part of your budget is concerned? Yeah, that's a good question. You know, if you were to look at this vehicle, what would you say it's worth?
Actually, it's not a specific question to me. I just know it's something I've dealt with in the past and just had to work through it. But I just want to know if there's a rule of thumb to go by. Yeah, I mean, you know, typically, I mean, if it's something you're paying for, you have a note on, I mean, anything that's more than 12 months' worth of payments, certainly if the costs get up to more than 50% of the value of the car, I think that's really the key. But in most cases, you just want to evaluate what's the market value of this car, how much have I spent in the trailing 12 months, and what percent of the value of the car is that. And when I begin to push over 25% heading toward 50%, clearly, it's time to make a change. And again, you've got to always be evaluating, you know, what is the underlying condition of this car? Is it something that's just going to continue to have problems? Or did I just have one major event like a transmission? I've had an independent mechanic look over it. I've made the decision that, yeah, if I make this investment, I'm going to be able to get another 100,000 miles out of this car. Then it might make some sense.
But I think those two rules of thumb certainly could be your guide, apart from anything else. We appreciate you checking in with us, Robert. Thank you for your call, sir. We're going to pause for a brief break.
This is MoneyWise Live, where God's word informs every financial decision. Stay with us. More calls just around the corner. We'll be right back. Hi.
Yeah, I just love your program. Thank you. Yeah, I have a daughter who's 34, dating a young man who's 38. And she is, it's her second marriage, and he's never been married. They are both God-fearing, wonderful Christian young people. But he is much more unstructured about money and lifestyle than she is.
She has a sales job from Israel, but she works remotely. And then he is more freelance. He's very knowledgeable about plants, and he grows and sells plants and does some landscaping. But it just seems like when he has enough money, he's very generous. Like this weekend, he dropped something to go on a weekend mission trip when he actually should be taking care of his own business. She doesn't feel like he's structured to talking about providing for their future before he very generously gives away what he doesn't have.
So I'm asking for advice of where they could go to get some counseling or something maybe with this. Yeah, very good. And so she sees this as a concern.
It's not just you, correct? Oh, definitely. Yeah, okay. And how close are they to marriage? I mean, are they actively talking about engagement? Yeah, they've been dating 10 months, and they are planning to go to see a wonderful marriage counselor, pre-marriage counselor. But these concerns are, you know... Well, clearly this is something that needs to be addressed, and it can be, because this is a part of what needs to happen as a part of godly pre-marital counseling. They need to really lean in to this area of finances, especially given the concerns that she has, beginning with just a lot of dialogue around how was money handled growing up, and what are their thoughts on the way money should be handled, and what lifestyle do they think God is calling them to. And, you know, as a married couple, if that's the way the Lord ends up leading, and what about giving and generosity, and what is that spending plan going to look like?
I mean, I think that conversation is going to be key for them getting on the same page. Then second, I would encourage, you know, once they decide they are going to move to engagement, I would have them connect with one of our MoneyWise coaches at MoneyWiseLive.org. Just click Connect with a Coach, and have a third party that can walk with them, and not only teaching some of these biblical principles we talk about here on the program, but actually helping them develop their budget, their spending plan, and talk about how they're going to control the flow of money, you know, on a monthly basis, and some of the decision-making processes that are going to take place. That's going to be really key, making sure that they're on the same page with regard to transparency as well as oneness, that they're going to combine their finances and develop a shared vision, even if there's one bookkeeper for where they're going moving forward. And then I think the last piece is, you know, if they would be willing to have a mentor financial couple from their church. So perhaps, you know, pray and think about who might be an older couple that would walk with them for the first year financially, just to help them deal with kind of the issues that will come along. And I think if they're willing to take those steps, a good bit of talking and dialogue, really unpacking a lot of the things that, you know, lead to how they both handle money, and they're going to be different, you know, we each bring our money personalities to the table, but it's about recognizing each other's strengths and weaknesses, and then developing a shared vision moving forward.
Then working with the coach to get the actual plan, it's one thing to have a plan, then you have to stick to it, and that's where the mentor couple will come in. If they would be willing to do those things, I would feel a lot better. The last thing I would say, Lee, is I'm going to send you a copy of Howard Dayton's book Money and Marriage God's Way, and I want you to ask them to perhaps, you know, go through that. Maybe, actually, we'll send you two copies, and they can each read a chapter, and then maybe they come together on a date night once a week and talk about it. I think if they do those things, they'll be in a, you know, a real good place to at least identify where there's going to be a real conflict moving forward that needs to be addressed, or whether or not they can come to a shared vision moving forward.
Does that make sense, though? That's excellent. Would you repeat how to get hold of that coach again? Yeah, just go to our website, MoneyWiseLive.org, and click Connect with a Coach. And these are volunteers that are specially trained in all of this that would be willing to walk with them for six weeks or more to not only teach these principles, but to set up their spending plan, debt repayment plan, giving plan, and work all of that out in advance with them, okay?
That sounds wonderful. Do you want me to hold onto the line? Yes, ma'am, you hold the line. My producer, Deb, will get your information. We'll get those books out to you today, and we appreciate your call. To Chicago, Illinois, Maria, thank you for your patience. How can I help you?
Thank you. I was calling. I'm 58 years old, and I want to retire at 60. I wanted to know if I'm on the right track. I have some savings. My home is paid off, and I have a condominium that I rent. Okay.
I just wanted to see if I should be. Currently, with my employer, I have a 401 that I put in, and I have another 401 plan from my previous employer. Okay, very good. So what do you have saved up in retirement assets, Maria? I have, in the savings, I have $1.8 million.
Okay, and go ahead. My home is paid, and right now it appraises at about $348,000. My condo, I have a mortgage on. Okay, and is that the rental?
That's the rental property, yes. Okay, and do you have good cash flow coming off of that? I make about $400 on it. Okay, after all of the expenses are paid.
Right. Okay, and do you plan on collecting Social Security when you retire in a couple of years? Well, I don't think that I could do that at 60. No. Okay, I didn't realize how old you were.
Very good. Yeah, you need to wait until at least 62, and I'd probably wait until full retirement age if you can. Maria, have you put a budget together? Do you know what it's going to take to fund your lifestyle once the house is, well, the home is already paid off? So, given the rental income that you have coming in without taking Social Security, what do you think you need, either monthly or annually, in order to fund your expenses? I haven't put a budget together. Do you think it's more than $6,000 a month? No, not at all.
Okay, great. Because here's the thing, you know, not counting the rental income and not counting Social Security, you know, with $1.8 million and whatever that grows to over the next couple of years, I mean, you should easily be able to pull off $70,000 a year out of that without ever touching the principal. And so, because you've kept your lifestyle modest, you've paid off your debt, you know, or you're working toward it, you know, I think you're in a really good spot here, and then when you begin to collect Social Security sometime down the road, that'll just be additional funds that you'll have available. So I think you're in a great spot to really ask the Lord to give you a vision for this next season of life. I would connect with a financial professional if you don't have somebody managing that money, it's going to be really critical. That's a lot of money the Lord has allowed you to put away to fund your needs moving forward as you move into this exciting chapter. I would encourage you to connect with a couple of Certified Kingdom Advisors and find the one that's the best fit for you, if you don't already have that covered.
If you do, that's great. But if not, go to MoneyWiseLive.org, click find a CKA, you can search using your zip code. But apart from that, I think you've got a great plan here, you've obviously been a diligent saver, and it sounds like you're right on track. So all the best to you as you move forward. God bless you, we appreciate your call. Folks, we're going to take a quick break when we come back much more on MoneyWise Live, where God's word intersects with your finances. Stay with us. Welcome back to MoneyWise Live, so glad you're along with us today. Hey, our team is taking some time off today, so don't call in. This is pre-recorded, but we have some wonderful calls lined up that I know you'll enjoy. We're going to talk to Lori in Yuma, Arizona in just a moment. But first, Howard's in Chicago. And Howard, how can we help you, sir? Yes, I'm about 58 and I have obviously a few more years of working, but I'm wondering where I should be focusing in terms of whether I should be paying off my home, which is about $250,000 left, or whether I should focus more on 401k retirement savings.
Yeah. Well, it's a great question because when we think about the use of God's money, it's all about priorities, right? And we want to start with what are our values, what's most important to us, and realize that the way we allocate God's money says where we've placed our trust.
And really what we believe God wants us to do with his resources, because it's a tool to accomplish his purposes. And clearly part of that is to become debt-free over time and to save for the future, assuming we're providing for our family, assuming we're giving systematically, and I would say even sacrificially. And we've brought some planning to our ultimate savings goals. So we're not just accumulating for accumulation's sake, but we know where we're headed and we've established a financial finish line.
So all these things are good. So as long, Howard, as you have that emergency fund in place, you're giving at the level you feel like the Lord is leading you, you've taken care of any consumer debt, and you're on track with your retirement savings, then I think as you look at allocating beyond that, I would do this. The benefit of compound returns is you invest systematically over time for the long haul. As you dollar-cost average in, you're buying into the market at high points and low points, and you continue to put that money in, and over a long period of time, it grows and builds wealth. In fact, the stock market has been the very best place to build wealth over the last hundred years with systematic investments and with the least amount of risk, but we also want to be moving toward being debt-free. So the way I would strike that balance is to, at a minimum, make sure that you're on track to have the home paid off by the time you reach retirement age. So if you think that's seven years from now, the question I would ask is, based on the current term of the mortgage, could you add enough to it each year in terms of adding to your minimum payments so that you align the payoff of the mortgage with your expected retirement, which we know could change one way or the other? And then any additional surplus, you would continue to plow into that 401k so it's growing on a tax-deferred basis.
Now, your financial situation may or may not allow you to do that, but that would be kind of my starting point. Give me your thoughts. Yeah, so you kind of described exactly where I'm at in terms of all of my other, you know, I don't have any other debt, I'm tithing as my number one priority, and then obviously taking care of the rest of my monthly expenses. So that part's out of the way. Yeah, I mean, if I just went on the path right now that the mortgage isn't due till, I don't know exactly what year it is, but it's like 2040 or 2035 or something.
So it's, I can't just play that out. So I guess what I was also thinking was, should I take advantage? I think I was planning on taking advantage of the 401k match that my company was doing as a minimum just to make sure that I get that and then focus on the house and then whatever's left I can do for 401k.
Yeah. Do you feel like you're on track with your retirement savings? Do you have a sense of what your ultimate goal is to be able to continue to fund your lifestyle once you retire, you know, off of the just based on the income you could produce from those retirement savings? I feel like I'm in pretty good position. But, you know, that's a big question mark for everybody, right?
What is the right number? And then there's a level of, you know, trust in the Lord and providing when that time comes. So, yeah, it's hard to talk about unless we get into all the details. So I've asked a question, but Well, so here's my thought on that. I think you're exactly right. You know, we need to have a plan. We need to consider that plan prayerfully. As I said, I think it's important to know your your finish line beyond which you'll, you know, continue to accelerate your giving and allow the Lord to change those plans over time. So what I would recommend is you connect with a certified kingdom advisor there in Chicago, even if you don't use that individual for investment management, just to do some straight planning to really have a third party who understand God's heart related to money, who can really help you determine based on what you expect your lifestyle needs to be in retirement. Subtracting any guaranteed income sources you might expect, like Social Security, and then projecting out based on your current trajectory where your 401k will be and what kind of income that could throw off on a, you know, using, let's say, 4% a year where you're not drawing out of the principle. You're just living off of the income with a largely fixed income portfolio, but with a smaller growth allocation to stocks, you know, would that meet your needs based on your current trajectory or are you behind or maybe you're ahead of the game, you know, and just put all of that into the equation so that you at least know where you're headed.
And, you know, you've got somebody else looking at it from that perspective. So that's the direction I would head, but just generally, I love what you're hearing. You're trusting the Lord, you're prioritizing your giving, you've living within your means. You want to focus on debt reduction and you want to save for the future. That's all good. But I think, you know, bringing that finer point of planning to the equation so you know where you're headed and you have some peace of mind that you're on track to get there, I think will really help and you can connect with the CKA there in Chicago at our website moneywiselive.org.
Just click find the CKA. We appreciate your call. Let's head to Yuma, Arizona. Lori, what's on your mind today? Yes, thank you for taking my call. We are in the process of purchasing a home and I made it very abundantly clear to the lender that interest rate was hugely important to me. So much so that because of another home that we own, she wanted to give us a rate as an investment.
And so I took out the loan in my name only so that I could get it as a primary residence. So with all that taken care of, we are two weeks away from closing and she's just sent me a letter stating that my interest rates, my choices were to lock it in at 4.375 was with no point when she already sent me a contract at 3.5 and I thought she had locked it in. My question is, is there anything that they can do now that they did not lock it in? Well, I think the question is going to come down to and you're going to need to escalate this perhaps beyond the person you're talking to, you know, whether or not they should have locked it in based on the communication you had and whether, you know, they're willing to take responsibility for that. I suspect if it wasn't locked, unfortunately, you're not going to be able to get the rate that was promised to you. And, you know, you could go back and trace your communications to determine kind of what the expectations were based on the instructions you provided. And if they failed to comply or act on those instructions, then clearly, you know, if they're a reputable company, I would hope they would make that right to you in the form of, you know, reduced closing costs or discount points that you don't have to pay for to get that rate back down to what it was.
But I suspect there was some sort of miscommunication and therefore, you know, they're going to say it just wasn't locked and this is the prevailing rate today. Now, keep in mind, Laurie, and I know you probably don't want to start this process over, you know, rates are lower than that. If you have, you know, good credit, you should not be paying that high of a rate right now. So it may be worth just going to bankrate.com to see what other programs are out there because you don't want to start buying that rate down.
I mean, that's going to get pretty expensive pretty quickly. You know, it's going to be typically about 1% of the mortgage amount, you know, for each percentage point you want to buy it down. So, you know, one point on a $300,000 mortgage is like three grand.
So that's going to add up quickly. And so, you know, I would start with where you're at, tell them, listen, you've been in this process, you had certain expectations that haven't been met and see what they can do for you. At the same time, I would probably start seeing what else is out there, you know, and I'd start at bankrate.com to see what loan programs you might be able to find that could do a lot better. Because keep in mind, you want to try to find, you know, the best current prevailing rate today, and you want to not really spend more than 1% to 2% of the mortgage on the costs of the refinance.
Because if you go much over that, it's going to take too long to pay it back. Does that all make sense to you? Yes, it does.
But I do have a couple of questions about that. One is, they did send me in writing the commitment to the 3.5, and they told me that was the best rate now, and my credit is really good. So, you can check this bankrate.com to see if they have a better interest rate. But once they do change the interest rate, is there anything they can do besides maybe offering to take some of those points on themselves? No, probably not, because the rates are moving around all the time, and if that rate wasn't locked in and guaranteed for you for a period of time, usually 30 or 60 days to give you enough time to get it closed, then they have the ability to move that around. So, it just depends on how that rate was promised to you and whether there was any kind of lock for a fixed period of time that would allow you to get them to make good on what they had offered to you. So, I'd go back to the company, have all your documents in place, look at it, and then understand exactly what was said so that you can get to the bottom of it.
I know this is frustrating. I think your best bet is to try to get somebody on the phone who's a manager who can walk you through exactly where you stand. We appreciate your call today. We'll ask our MoneyWise Live community to be praying for you as you sort all of this out. Well, folks, that's going to do it for us today. So thankful that you were along with us today. MoneyWise Live is a partnership between Moody Radio and MoneyWise Media. So thankful for my team every day that supports me in this great work, Jim Henry, Amy Rios, Dan Anderson, and thank you for being here. We'll be back next time with another edition of MoneyWise Live where God's word intersects with your financial life. In the meantime, may God bless you. Bye-bye.
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