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Dealing with Investor Anxiety

MoneyWise / Rob West and Steve Moore
The Truth Network Radio
September 2, 2022 5:30 pm

Dealing with Investor Anxiety

MoneyWise / Rob West and Steve Moore

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September 2, 2022 5:30 pm

As the recent economic challenges continue, the financial markets also continue to go up and down. And that volatility has certainly caused investors to feel anxious about their portfolios. On today's MoneyWise Live, Rob West will talk with Chad Horning of Praxis Mutual Funds about dealing with investor anxiety. Then Rob will answer your questions on various financial topics. 

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Rob West and Steve Moore

If you felt discouraged, worn down, or are thirsting for. You need rest and renewal.

Hi Deb Horton close to becoming well and I want to invite you to join the new women's conference September for a time of deep encouragement and challenging you hear from me. Author Heather Bowman and so many more wise and wonderful. Learn more and sign up for renewal 2022 event board. Do not be anxious about anything but in everything by prayer and supplication with thanksgiving let your requests be made known to God. Philippians 46 by Rob Wilson. That passage is always comforting, but especially now as we face new economic challenges. Investors are certainly feeling anxious about events on Wall Street will talk with Chad Horning today about how to deal with that anxiety is on to your calls at 800-525-7000 800-525-7000. This is moneywise live your financial jobs, the president of praxis, mutual funds, a leading faith-based family of mutual funds and an underwriter of this program just great to have you back with us.

Thanks, Rob. Good to be here glad to chat with your listeners will. This is certainly an interesting time in the markets, and I know you'll be an encouragement to them today chat with the markets like they've been this year. Hell have you all been advising investors about their investing portfolios. We try to convey that during chaotic times like we've been experiencing. It's important to remember that as people of faith were encouraged not to worry, as you said in the verse but to put our trust in the Lord for all that we need. Of course we live in a world that has its stresses and obligations and so it's important for us to make good decisions in the world that we inhabit portfolios that are invested well can help us move out our financial needs over many stages of life. But there are times that we will be tested for sure will be tested by the markets they go up and down and it won't always be when it's convenient for us. Well, that's exactly right. So then how should investors plan for the inevitable ups and downs of investing that we've been experiencing as of late.

Many of us have financial advisors your listeners likely have either a financial advisor that they talk directly with or they have accountants or others that help to advise them and it's typical for financial advisors to ask people questions early in their relationship to assess their tolerance for risks so often will be something like what how will you react in a hypothetical market selloff and they ask questions that try to get at how much risk you might be willing to tolerate yeah and that's an important exercise to go through to get a little further, what would that look like one example would be an advisor might ask a client to say what would you do if your investments were down 20% over a very short period of time because they want to know whether or not you can tolerate that kind of volatility that would be associated with earning returns over the longer period of time and if you say that you'd be willing to accept 20% down. If you could get a higher return over time, then they're likely to invest in a more aggressive strategy for you.

That would include things like stocks, rather than a whole lot of bonds but the real question, of course, is whether you will be able to tolerate the periods when your portfolio loses money and stay in the markets so that you can benefit from them for the long term, so it's this hypothetical type of situation that advisors often set up for their clients to get a feel for whether or not they can handle the inevitable ups and downs.

Yeah the key though is is there a breakdown between their response and reality when it happens right because it's one thing to say all sure that 20%.

When I open the statement and see my portfolio has lost $100,000, I'll be okay.

I'll just keep a long-term perspective little harder to do that in practice right, of course, when the rubber hits the road and the downturn eventually arrives it inevitably will feel different than what you expected during your hypothetical exercise. Now it becomes real it can be easy for you to justify a way that the attitude you might've had years earlier, but when you're in the middle of it. It feels very different. It often happens is in the middle of downturn, people will focus on the unique factors that cause the downturn.

Somehow they feel scarier than the generic reasons that you might've created for yourself and your hypothetical situation. Yeah that's really helpful. Chad only come back will continue to unpack this and talk about the importance of self-awareness for investors.

How do you avoid the temptation to act quickly and what is the data say in terms of staying in the market. Even during these challenging periods were joined today by Chad Horning Jazz, the president of praxis mutual funds and underwriter of this program will we come back much more on this topic just around the corner. Stay with us thankful you joined us today for moneywise live a Rob Webster hose joined today by Chad Horning jet is the president of praxis, mutual funds, a leading faith-based family of mutual funds in an underwriter of this program you can learn more@praxismutualfunds.com that's PRA XIS just before the break. Chad we were talking about the temptation in these volatile markets to jump ship. Maybe go to cash and miss out potentially on the markets recovery because of the fear that can set in during these tumultuous times that it sounds like you're really emphasizing the importance as we think about this of self-awareness for investors is that right yeah Rob, you know. One example here as we were talking about that we recently experienced in the first part of the year is the selloff and we had the ongoing effects of the covert pandemic.

We had a war in Ukraine, which is frightening. We have the highest inflation since the early 1980s and more and so these were these were unique characteristics of the selloff that hypothetical that you put yourself through.

Perhaps years ago you wouldn't have known and so knowing what you know about the state of the world and the things that could go wrong, an investor might be tempted to react differently than they thought they would. Yeah that's exactly right. So then how would you counsel investors Chad that are tempted to act quickly in the face of fear.

While this is hard. We are hardwired to respond to threats quickly. Our ancestors are a good fit, say, the ones who survived have been very effective at either fighting or fleeing, when faced with danger in this instinct is really powerful and it and it leaks into all of the decisions we make, including investing and so the urge to sell when things are scary might be your first impulse, but it really can be detrimental to your investment portfolio and therefore to your financial future. It's often better to wait to pause a little bit. If you have a professional investment advisor to talk with them rather than making a quick decision yeah I know data also helps as well Chad, you know, as you said, reacting on impulse can be really detrimental to your investment portfolio. But look for you help us understand we can learn from the past. Would you share a real-life example to illustrate this. Sure, I think. Let's use the last 42 years or so since 1987, 1980 through the end of 2021, as are.

To look at the S&P 500 index, which is a good measure of the large publicly traded companies in the US, yet the S&P 500 index was up 12.3% on an average annual rate so that sounds great. 12.3%, but it was anything but a smooth ride and investor had to stay invested in that index.

To achieve that return that really long time but it fell 20% seven times and it fell 15%, 15 times and so you really had to withstand a whole bunch of fear along that 42 year period. So think about some of the big things that happened during that period of time.

There was the Black Monday crash in 1987.

The technology bust in 2001 into the great recession in 2008 nine September 11 attacks and all of the fear that that induced him, and many other unnamed selloffs so investor had to stay involved. All that time in order to get that return yeah I'm sure many of our listeners remember where they were turning some of these I can remember exactly where I was when the headline came across the Lehman Brothers ghetto had collapsed in it.

As we were entering this great that recession and all that came with it and really it takes real willpower to stay invested and keep investing to get the benefit of dollar cost averaging through those dark periods doesn't that's right.

And this. Certainly tested investors. What's really amazing. After thinking about the statistics that I gave you is that the market, the S&P 500 generated positive returns and 35 of those 42 years we had all those downdrafts, but really if you look at it year by year you had 35/42 positive years and here's the catch. You had to be invested the entire period to get that 12.3% annual return. I mentioned yeah and investor attempting to move in and out of the market most likely would've had a record that was significantly less than that. So Jed summed this up for is where does this all leave investors today. Of course nobody knows when the equity markets will settle down or what might soothe investors collective anxiety. We don't know whether the Federal Reserve will be able to tame inflation. The way they're targeting and not cause a recession we don't know how long inflation will remain high and erode people's income but if history is a guide. Take your time and not making rash decisions in the face of fear is usually a wise choice.

Markets have always been risky. So the recent experience we've had in 2022 should come as no surprise. The specifics are unique and they feel scary but this is not a surprise for us, but your reaction and your feelings in the face of the circumstances may have surprised you if they did we'd invite you to go back to an advisor and talk through what might've changed in your situation to make to require perhaps an adjustment. But if during that hypothetical conversation you had years ago you said you would sit tight in the face of a bear market.

You have your answer for how you might want to actually follow through.

Yeah that's really helpful Chad before we let you go. Today I want to give you an opportunity to talk about a different topic, but that's you still of course related and that is how we can apply our faith to our investments. Of course, practice mutual funds is really a leader among of faith-based mutual funds. This is an exciting day in terms of the opportunities to align our values with our investments talk about the opportunity exist for believers that they may not realize, and what that looks like that course, thanks for the chance to chat about that as you mentioned relative to let's say 10 years ago that believers have lots of ways to express their faith through their financial decisions. It can be in the conversations you have with financial advisors and it can be in the investment products that you choose to invest in. There are range of mutual funds, in particular in ETF's that might fit your emphasis the kinds of things that you care about most. Nearly all of those products have some sort of negative screening that allow you to avoid investments in certain types of companies that you would rather not support many of them, like praxis would do other things like shareholder advocacy where we work with the company management teams to encourage them towards better behavior. All of them are careful in the way that they vote their proxies, which is a bit of an arcane area of the markets but it's a way to communicate values to support managers in ways that reflect on your faith. That's great. Well, thanks for helping us keep a level head about our investments, but also I'm glad we were able to talk for just a moment about the incredible opportunity as believers to align our convictions and our values with our deployment of capital through the investments that we own the books, if you want to learn more. I'd love for you to check out praxis mutual funds@praxismutualfunds.com that's PR AX IIS jet hoarding as president of practice mutual funds in Chad. It's been a privilege to have you with us today.

Thanks for the opportunity all right puncture calls her next years. The number 800-525-7000 will be right back with us today and moneywise live amount less euros figure calls and questions today on anything financial 800-525-7000 800-525-7000. This is where we apply God's wisdom to your financial decisions enjoys we'd love to hear from you but said right to the phones, Hagerstown, Maryland Judy, thank you for calling redhead. I'm anxious to hear your advice today.

Okay you my question, yes ma'am okay I am about to receive about $230,000.

As result of the sale and I have no bills and I my income is about $3000 a month. I don't need any money, and I'm trying to have at least 10% over and above my church. This doesn't count giving to my local church. I'm already doing that but I need to know how to handle that kind of that large sum of money before so I can work best with their taxes and just I don't how to handle how to get that yeah sure it's great questions. Judy does this say real estate that was sold. Arm and there was not enough primary residence correct correct. Now we just step can have the family for long time and decide okay and were you a partial owner of that yeah yes it was family property, all my children and I am get together in the 230,000 you can receive.

This is the proceeds played your portion that's my portion. Yes okay so they'll be capital gains that will be due on that CO some taxes based on the profit that you all realized the purchase price would be the cost basis and the need add to that, you know, any improvements that were made to the property that increase the value transactions costs and then all of that will get subtracted from the selling price and that will determine the overall profit, and that would be allocated out to each of you as owners so you have you set something aside for the taxes on that or you plan now that my grandma that the gross income.

Okay that's very good for anything taken out got it okay excellent and then has the property already been sold yet. Okay. Went for settlement okay sorry if it hadn't been sold. I would say that you could have we could given a portion of this away prior to the sale. That's okay.

You'll realize your portion you'll pay the tax on it and then you can make a donation in the charitable contribution for the amount of the ties based on your increase, which I would say all of this is your increase.

You didn't buy this property is that right do it yourself correctly answered.

Currently, all inquiry very good.

So at that point I would say you know you if you were to give a tithe on this, which is 1/10 of the increase. Let's say you to give $23,000 that would allow you probably with any other charitable contributions you made throughout the year. Plus, if you had mortgage interest. It probably like to get above the standard deduction which would mean that you be able to itemize on your taxes.

So you'd get a tax deduction for what you made as a charitable contribution. So that's gonna help to reduce some of your taxable income. One a really effective way. Unless you just want to write this check. The one your church directly into 1 Great Way to think about this might be through what's called a donor advised fund were essentially you'd make the $23,000 contribution or whatever amount you want to give to your donor advised fund. It would be recognized when you make the contribution as a single charitable contribution in the tax year that you made it, and then you're able to then give it out, like a charitable checking account to whatever ministries or nonprofit you want to in whatever time period you want. Now if you know where you wanted to go. You just want to make that gift on the same day within this probably not a need to do that but if you want to give it out either. Over time, or to multiple charities or ministries, or church, then a donor advised fund could be a great way to do that because you get a single charitable contribution receipt for tax purposes but then through the click of a button. You could actually distribute the money at whatever time. And in whatever increments you want as long as it's going to a charity or nonprofit. Does that make sense to step that up with donor advised you yeah you would set it up a debt through our friends at the National Christian foundation in CF giving.com it would take in less than five minutes to do online.

It's like opening an online checking account you'd just go through. You know the process of filling out all information click the button and it's open and then you know you would make the contribution directly to the donor advised fund and then through that online account you would create. Once that money is received, then you could grant it out to ministries or charities at your discretion. Like just exactly what I want. Okay great you go to in CF giving.com in CF giving.com that stands for national right Christian foundation that was started by Larry Burket and Ron blue in the late 70s and is also a wonderful organization when you get there. Judy, you look for the button that says opening giving fund that's what they call a donor advised fund in CF giving fund and you'll open that right there online and if you have questions you can call the number and they'll help you answer any questions you have and walk you through the whole process that's perfect and you can go ahead and set up the account. Judy even before you receive the proceeds of you want to go ahead and get that done, you could go ahead and do that right away and I hope that's helpful to you. God bless you and thank you for calling today 800-525-7000 800-525-7000, and just about over and take a quick break we come back more of your questions. A quick email that goes got along with the this question, we just had from Judy Jan Rice is the Bible say tithe includes what we give to the church but also to other ministries to that, I would say Jan, basically the Bible says that the ties should go to the local church and ask for people gave their time, their offerings to the elders, the apostle in Galatians 66 Paul writes let the one who is taught the word share. All good things with the one who teaches our friend JD Greer at Summit church in North Carolina calls tithing to your local church. God's plan and and I think it's very clear that when he says it's the vehicle through which we care for the poor, feed the hungry people to minister in the community and send people out to the nations.

When we get to the local church. We get to the central institution of the mission of God will be right back. Stay with us today and moneywise live biblical wisdom for your financial decisions. Lines open here today on a holiday weekend.

It's a Friday but were not done yet. So give us a call at 800-525-7000.

By the way coming up in the next segment our final segment of the broadcast. Today a Jerry Boyer, our resident economist stops by Jerry will give us a week in review as we look back over the markets and the economy and weigh in on perhaps what he's seeing as we head into a long weekend so look forward to that jury. Boy are joining us today on the broadcast back to the phones we go Libertyville, Illinois, J thanks for calling today, go right ahead. I think my caulking yes ma'am okay so great thinking calling. I enjoy it.

I know that gonna be no income because you got that right now. Okay I own a condo association fee and gone up quite a bit over the last four years I would thank and how I can on old enough to retire 52 week high, God willing I 65 okay but I wanted to get a single home, condo, because the associate conveyed a grown-up act and that a mortgage tapping out with you Dario Cavalli all about quality content out on it like I could pay off what my 401(k) if I wanted to but don't do enough to know that I care idea I would agree that's a good idea. The apostolic I'm just wondering if I purchased a single-family home and what constantly being half of what I pay for the mortgage because that's not like a cookie going up.

I'm afraid it's going to be a mortgage payment by time he goes up many more years yet. Well, I think the key here J is not really single-family home versus condo. It's what is your total housing expense in one versus the other. You know doesn't really matter whether you know it's it is one or the other. As long as you count the cost so that in the case of the condo.

You've got this association fee, which is you said continues to climb and that's real in the house you have other expenses that you probably you know would have to pay directly than in the case of the Condor rolled into the association fee you have to count your potentially additional utilities. You can have upkeep for the yard. You might have some more maintenance to keep the roof up to date and replace it at some point and you know the windows you perhaps you have more of them. So I think as you look at the total cost of ownership for the condo with the association fee plus the single or the single-family home and all the associated expenses that come with a single-family home. You've got to compare apples to apples.

And then it really comes down to the price point. So for the amount of living space you want in the neighborhood you're looking for with the condition of home you want what you can have to spend to buy that home versus the condo that you have right now and then look at the you know what kind mortgage payment, principal, interest, taxes and insurance plus those other expenses, and then just it really becomes a budget question at that point. So I think you just really need to crunch the numbers you know what it cost you live in that condo. The next step is to say, okay, what home what I be comfortable and that fits my lifestyle and the location, all those things and then find out what are the utilities and what is the upkeep and how much do I need to put aside for home maintenance and then I think the answer will become pretty clear as to your financial readiness to do that, whether it's more expensive or less expensive, and then it's just a quality-of-life issue. Do I like the idea of being a Condor. I can lock the door and leave or do I want to single-family home. I got a little more space little more independence but I've got all this upkeep that I didn't have to think about when I was a the condo owner so it give me your thoughts on that. Yeah well that one thing about the bank and I can't any gap that bad. I need a new roof would be. I would love to be on a payment plan, but yet a problem if they haven't upgrading a lot of condos and they haven't upgraded my way out, but what they have great dandies then you get an additional cost for that because you can't stop shaking your assessment on top of that wealth. I think you got some homework to do. J I think your next step is to begin house shopping and start start to figure out what is it actually gonna cost me to get a home that I would be comfortable with to maintain my lifestyle and then you need to figure out okay. Based on that you probably need to plan on a good rule of thumb is 1% a year of the home value for home maintenance, repair, so $200,000 home you want to save 2000 a year in order hundred and $70 a month toward just a fund. This can allow for home maintenance, then figure out the utilities and the taxes and all that and then I think you're in your decision will become much clearer. At that point. So I think you got a little work to do for me. It doesn't matter which one you go with this just a function of can you cover the cost in the single-family home and are you up for the additional ghetto maintenance and work that goes into maintaining a home in the season of your life so you think and pray about that and if we can help along the way. Give us a call to Tuscaloosa, Alabama Augustine, I thank you for calling a redhead called my daughter who is been working for a year now and I had 25 how audit can't know everything that she had that in a savings account. I wanted to know what she can do what kind of investment all what type of savings would be good if a man about my credit union? Yeah, the question is, what's the purpose of that money is that money that she plans to need to tap into in the next 3 to 5 years.

I went to decide how that's what he would meet at, yet very good and that that could be in the next three years or so.

Yet all right good so that she doesn't need to invested but what I would do with the Augustine is put it in the high-yield savings account so I viewed look at one of the online banks they're paying about 1.7% right now and that's can keep climbing as interest rates climb look@marcus.com Ally Bank or capital one 360 the all great customer service. No fees and they pay great interest rates because they don't have brick-and-mortar bank branches, but they're still FDIC insured so they're still just as safe as any brick-and-mortar bank. They just pay a lot higher interest rate.

Another option she could look at is she could put up to $10,000 in what are called by bonds which are backed by the US government are paying 9.6% right now with almost 0 risk. You can only put in 10,000 a year and she'd have to leave it there for at least 12 months. She couldn't touch it for 12 months. But what a great interest rate with no risk for up to 10,000 of that 25,000. So I think those are two ideas the high-yield savings with the online bank and up to 10,000 in the bonds as long as at least as her enough for her emergency fund, which needs to stay completely liquid so she can get to it. In the event of the unexpected. I hope that helps you. Today we appreciated. By the way, the iPod, you can find out more treasury direct.gov. We appreciate your call today to take a quick break we come back. Our final segment of the broadcast today. Jerry Bowyer joins us +1 of your questions here moneywise live 805 5000 right back with us today moneywise live biblical wisdom for your financial decisions before we go back to the phones. It's Friday. That means a new segment for a suffering Jerry Bowyer resident economist, resident of Bowyer research editor of the business channel at the Christian Post jury is going to join us on Fridays to give us a bit of a week in review and maybe even as I gather a few of the harder questions for the week will toss those at them as well. Jerry good afternoon sir. Good afternoon.

Let's say the top questions until after I segment is over. You get back to you on now that that appreciate you doing is my friend boy markets, but under some pressure the last week, you know. It started with the Federal Reserve Chairman Powell in the Jackson Hole beautiful Jackson Hole telling us the gloves were off. He's ready to fight inflation.

No matter what, that takes on the other hand, we got a report today that the payrolls rose by 315,000 in August, so the job market continues to rage on which some say that means the soft landing on the economy is still possible. This seems like maybe a bit of a tug-of-war yeah tug-of-war when the tug-of-war is occurring. That means you're pulling in two different directions, and that in fact the problem with the Fed has died has two mandates. Those mandates are not consistent with one another. One of them is keep unemployment low and employment is rose today and the other is keep inflation low, but inflation is rather high. I happen to think that it is a mistake. Gil James talks about a double minded man being unstable in all his ways Daisuke in Greek to sold and whether were talking about her personal life or whether were talking about our nation when you give an institution to conflicting goals and that institution has enormous power.

I mean, think about the way we pour over the Fed minutes. Like, it's like you know some prophetic utterance and we have to find the inner meaning of it.you know like it's divine words or something. This institution has so much power. So every day markets have to guess what the fans going to do what used to be focused on how the business is going to do so. If the if earnings go up a business that makes it more valuable. Now the dynamics almost completely driven by on any given day, when the Fed looks at the economic news which mandate will they choose what they choose to fight inflation by raising rates but that slows the economy and hurt labor market will they choose to go the other way and not fight inflation. And so we don't have a recession and we don't have on high unemployment today. You and I talked a few hours ago, and that sentiment is completely reversed.

Since we talked the market when people looked at the jobs report.

It was a little weak, because unemployment rose and so they said okay the Fed is going to have to pump money into the system.

Then we got some news that Russian oil company is knocking to produce as much oil that's inflationary high oil prices so that all will depend obviously cannot go back to tightening and so the markets whipsawed based on what we would a few people in Washington whether enormous power what the markets are trying to guess they will do at the next meeting and that's obviously the challenge we face right now. Jerry obviously, the Fed has been focused laser focused on keeping rates near zero for a long long time. The been able to keep inflation in check.

At the same time, the challenge is many are saying. That's just not to be possible as the base case moving forward. And given our debt levels. Now it's not a matter of the dad in the percent of the GDP. It's about servicing the debt which is the real issue with each of us think you know out here when we borrow that results in a monthly payment that has to fit into our budget and if interest rates have to head up because we got a fight inflation that could create some real challenges right now when you're talking about an individual family when a family has a debt crisis you know state bankruptcy or restructuring or something they don't get it because of their abstract network. What's their total debt minus the total asset they get it when they can't make the payments anymore. The trigger is they can't make the payments anymore. So if the monthly deficit, not the overall debt picture that tends to be the trigger bottle and have looked at hundred nations over 30 years exactly the same thing is true with nations.

It's not. You don't look and say what the debt is this high. Therefore, we have trouble. It's more like 10 name and they make the next payment what what this central bank is done is it kept interest rates so low that our federal government can make the next payment because the next payment has like a low mortgage rate like the interest rate is low, but by doing that, the pumping money into the system, creating bubbles, housing bubbles, etc., and inflation. So what they do well. What is a double minded man doing neither decision is acceptable what they do is they tend to go back and forth between two scenarios to fight inflation on.

I don't know I don't want to buy too much.

The markets are going down. I guess what we want to fight a recession over the create new money and were going back and forth in a double minded man is like is like a wave driven by the sea and tossed and that's what our leadership is right now to keep a close eye on. That's Jerry. I mentioned the hard questions of the week.

Obviously the spotlight this week, largely on the action from the president's office from the administration on student loans for giving up to $20,000 for most folks up to $10,000 in student debt. Let's keep the politics out of it for second and just talk about is this inflationary what is it mean for the rising cost of college tuition moving forward and what about those folks that were really diligent in paying their debt off it a little bit inflationary because of her talking about three or 400 million over 10 years.

That's not a lot of monetary creation except what if this is the one and done what it does is the opening bid and now politicians are going to say well leave the gate that he create 10% 20 per day 10,000 I'm going to forget 20 I usually does a bid when it comes to debt default. This, it is not economics but it's worse culture because it tells you thrift doesn't matter it a you a you shouldn't be self-discipline.

I think the thing that bothers me the most about it is that I've seen Christian leaders going out there and saying well. Jesus says that we should forgive our debts, as well is always loved our debt to be forgiven as we forgive our debtors in the Bible talks about debt forgiveness and submit to an Jubilee. Therefore, this is a good thing when the world doesn't wrong things and thinks badly. I'm bothered but when the church can't think with clarity, then I'm really worried because where the guide so if we're a good guide in the world isn't listening to still hope. But if we are so biblically illiterate that we can't understand the difference between the edict that went out of transferring the debt from the nurse to the taxpayers can't tell the difference between that and what Jesus did on the cross, which is the debt wasn't given to debt was paid.

If we don't understand the Bible that well that we can fall into this and think this is a biblical practice and no wonder the world is confused. Interesting perspective Jerry Jerry were about out of time. I give you the final word. How should we then be thinking, not as a double minded man, but as God's people looking through biblical lands about these times, and the path forward single-minded. That's the alternative and the single-mindedness is focused on Christ and his kingdom, telling you what to do with all of your decisions but you only have one mandate and that simpler is not easy or not something is a little hard but it's but the yoga still light. Why because you don't have to decide what your mandate is. You just have to decide what you're going to follow it.

So if you do that you won't be driven by the wind and tossed. We will be looking at these market whip lashes and get worried and make bad decisions, hot mouth, but you should be prepared. I don't mean get out of markets entirely.

I don't mean it's the end of the world.

I don't mean the load up on shotguns and all the rest of it. Yes, there's some risk out there but if you're frugal you follow your plan, you stay out of debt remain generous remaining community that is the best hedge against economic disaster is remaining in Christian community. If you do that, then you can look at the wet.

The wind tossing the waves you're not surfing them you're not being tossed with them you're standing on solid ground.

That's a good word. Well it's a great place to leave it for a holiday weekend, my friend, grateful for you and will talk to you next week. Lord willing, and for you. God bless our April by Jerry Bowyer with us today our resident economist. He also you'll find his writing. It's a Christian post and many other places. He's the president of Boyer research card back to the phones for our final moments of the broadcast today to Chicago. Ed, thank you for your patience go answer my call.

I'm currently about one page, God willing.

All the condominium work.

But once the 10 would like to buy a home.

So the morning.

You're the cute grant you was purchasing a home in the ballpark. The two ladies, the limited nature just trying to see you so late in life, but that's why I currently have about 50,001 account house account bank account and then I have another account what he felt about retirement account currently has about $50,000 in that account. I haven't done anything with the last five years of brutal continue earning just been sitting so two-part.

What should I take on that additional debt of trying to purchase a home that do with the belt and that's inside a company-sponsored plan of some kind.

It was for my previous employer. However, it's just built on the book so it's not that I have not rolled it over to a nuclear okay but it's inside a tax-deferred retirement account okay. I think the thing to do here at is to fast-forward eight years and let's say you're in retirement.

What is your budget look like and begin to look at what income sources you have, let's say over the next five days eight years that 350,000 you go ahead and invest that you have an advisor and that's that for you. Let's say that grows to 1/2 $1 million. You know that would probably throw off about 20,000 a year plus Social Security is not enough to meet your budget and what budget does that include the the principal, interest, taxes and insurance on the hundred thousand dollar mortgage or could it supported $200,000 mortgage which is what you're telling me it probably is going to be if you buy this next home. So I think you need to kinda run that scenario. Build out your budget.

Based on this new home that there would have no probably a couple hundred thousand dollar mortgage on it instead of a $100,000 mortgage look at what you expect to be able to pull out in retirement accounts, plus whatever you're expecting Social Security and any other income sources and just see if it works is always you're going with 20% and you are as long as you can support the payments not only now but in the future that I say makes sense. It gives you the ability to enjoy your kids and have a little more space. So I think that your next step that if you have questions, give us a call my friend for us moneywise lives a partnership radio and moneywise media.

Thank you to Dan and Amy and Jim so greatly enjoyed his great long weekend will see you next week


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