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The Togetherness Agreement

MoneyWise / Rob West and Steve Moore
The Truth Network Radio
November 17, 2022 5:10 pm

The Togetherness Agreement

MoneyWise / Rob West and Steve Moore

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November 17, 2022 5:10 pm

Having a good marriage takes commitment and lots of work. And if you’re part of a blended family, it may take a bit more work to make things good. On today's MoneyWise Live, host Rob West will welcome Ron Deal and Greg Pettys to talk about a great tool for second marriages called The Togetherness Agreement. Then we'll open our phone lines for your questions on any financial topic. 

See omnystudio.com/listener for privacy information.

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Hi, I'm Rob West.

Of course, having a good marriage takes work, maybe a bit more work if you're a blended family. Today I'll talk about a great tool for second marriages with Ron Deal and Greg Pettis. Then it's on to your calls at 800-525-7000.

That's 800-525-7000. This is MoneyWise Live, biblical wisdom for your financial journey. Well, our guests are Ron Deal and Greg Pettis, authors of The Smart Step Family Guide to Financial Planning. Ron, Greg, great to have you back with us today. Oh, man, it's so exciting to be here. Thanks for having us.

Good to be on. Well, guys, your book The Smart Step Family is loaded with practical financial advice for blended families. I reference it on this broadcast often, but in particular, I want to focus on one area where you've come up with a way for couples in that situation as a blended family to promote peace and unity in their marriage. It's called the togetherness agreement, and I'd love for you to start there.

What is it and why is it so important? Well, let's just start with the context for what we're talking about. Couples who form a relationship when they've had a previous life, if you will. Maybe one of them has brought children to the relationship.

They are often in middle age or later in life. They have a history, a financial history. They have debt.

They have expense. They have all kinds of investments that perhaps they've been working on for years, and now we're merging. But we're not just merging money. We're merging relationship. We're merging children. We're merging parenting styles.

We're merging some sort of lost death or divorce has preceded this new marriage relationship. All of that rolls into any conversation about money. I just don't think people realize how complicated that is. It's one thing to say, oh, so you've got, what, three bank accounts and I've got two bank accounts and we've got all these investments. Let's just put all the money together.

Well, no, no, no, no. Immediately, it starts to be about, oh, trust. And it's about, well, I couldn't trust the former spouse because they took me for every dime I had. So how am I going to make sure that doesn't happen again? It's about provision for me and for my children. I've got an aging parent.

How do I care for them? It is about all of those dynamics rolled up into a conversation about how many bank accounts you have. And so when we sat down, Greg and I and our other co-author David sat down and said, we want to write a book about financial planning in lended family situations. We have to take into consideration all of these dynamics. So we haven't just created something in the Togetherness agreement. Greg will tell you a little about that.

It's just a second. It's not just about money. It is about providing and loving well and caring and creating trust in your relationship that goes the distance.

Exactly. It's about clarity on so many of these, like you said, emotionally charged issues. When we said, I do his kids, her kids, their kids, what did we mean? What were the details around our vision for an optimistic future together? And so we find that the Togetherness agreement provides clarity to these emotionally charged issues. And in essence, as one couple said, we're writing the rules for our marriage with love and respect for both parties.

And that's what's so key here is that we want to let love and respect lead. And yet there are very real practical issues that we have to navigate. And Ron, to your point, money issues are hard issues, right? So money is symptomatic of a deeper underlying spiritual values based conversation that does surface some really tough and yet exciting conversations if we'll lean into them.

The question is, we need a roadmap or how do we get a roadmap to navigate that? You know, a lot of things about blended families, including marriage and navigating money, have to do with the pain of the past. And pain creates fear, right?

My last spouse really hurt me. I don't want to have that happen again. So I'm going to be guarded with you. Well, you know, fear is not a good way to make decisions about anything. Spiritually, that doesn't work. You know, we don't want to approach God that way.

We don't approach the people we love that way. And so we try to help people create this Togetherness agreement so it eliminates fear so that it is no longer a barrier to our oneness. Well, I'm looking forward to continuing to unpack this. What does it actually look like? Is it a binding legal agreement?

What goes into it? What about some of those touchy situations that will come up? What about a business? We'll deal with this and much more. Ron Deal and Greg Pettis with us today, authors of the Smart Step Family Guide to Financial Planning, just around the corner, 800-525-7000. We'll be right back. Thanks for joining us today on MoneyWise Live.

I'm Rob West, your host. This is where we apply God's wisdom to your financial decisions and choices. Joining me today are good friends Ron Deal and Greg Pettis, authors of the Smart Step Family Guide to Financial Planning. How do you navigate financial decisions with a blended family? And how do you even memorialize those decisions once you have those conversations?

And how do you do it in a way that's respectful and loving? Well, today we're talking about a great tool that Ron and Greg refer to in their book called a togetherness agreement, where it provides a roadmap for having these conversations and then memorializing them. And Greg, you actually advise folks to make this agreement, the togetherness agreement, a binding legal contract.

How will that help? And well, the marriage itself is a binding legal contract. Yes, that's a great question.

And we get it a lot. First of all, it provides specifics that are not clearly outlined in that general marriage binding contract. For example, I mean, the simple is how many accounts should we have?

Should we combine everything together all at once or have two or three accounts? Who gets the business? What does fair mean?

Is fair always equal? What are we going to do for our special needs child? What about the rights and roles of, well, grandchildren, step grandchildren, grandparents, step grandparents, any party who has a loving interest in our future can be a part of the togetherness agreement. It'll also help the team, your whole financial team, the financial advisor, the attorney, the CPA, all your agents, they need to have an overarching document that explains why did we decide to do this?

What were we thinking when we did that and so forth? You know, as Greg was talking, I was thinking, yes, marriage is a legal binding relationship. And yet, do you want to leave the future to the legal system of your assets and your money? You know, we've talked before about if you are married to somebody and spend 25 years together and your spouse dies and leave you all the assets and then you marry again in midlife. But don't make specific documents dictating where you want your money to go after you pass away. If you pass away and your second spouse marries somebody else and then they die, all of a sudden, all your money goes to that person's kids, somebody you've never met, them and their children instead of your children, unless, you know, that's called inheritance drift, right?

It just sort of moves away from you. And nobody intended that. It just sort of happened unless you've made provision for where you want your money to go after your death. And in this case and in that case, I should say, your children are provided for, you're provided for, your aging brother, sister, parent, whatever, whatever you're invested in goes where you want it to go. You don't want to just leave it to the legal system. You want to tell that system what to do with the things that you cherish.

That's so important and probably something that most folks haven't considered. Well, perhaps, guys, a story, an example would help to illustrate the power of this tool, the togetherness agreement. In the book, you include a story about a couple, Anthony and Jenny.

What was their situation and how did this tool help them? Greg's going to tell you in a minute a little bit about some of the specifics of what they came up with. But let me just set the stage. This goes back to how we started our conversation, the complexity that blended families often face. So Anthony has children. He also owns a company that he's been invested in most of his life that he's been building.

And he meets Jenny and she's a CPA. She's pretty successful. She's 36 years of age. She has children of her own and she has an aging mother.

Okay. So on the surface, when couples say things like, you know, I love you, you love me, we're going to be a happy family. And I assume that means you'll just care for my kids if something terrible happens to me and I'll take care of your mother if something terrible happens to you. And the best of intentions don't necessarily work out that way just because you love one another. You really need to put it in writing.

You really need to think it through. You really need to talk it through because it could be that in the course of doing their togetherness agreement, Anthony, he's got an assumption that his oldest son gets his company. He's shown an interest in it. He's been invested in it.

He's interned there. He went to college with the intent of learning how to run a business and he's going to come back and work with dad. And then if dad ever retires, that's been in the works for years before Jenny ever showed up. Yes. But if he doesn't express that clearly and openly, Jenny may have some assumptions of her own about what happens if he were to pass away, what happens to the company? Maybe she's got kids that are interested in that business. Okay.

So who's going to be in charge with that next generation of leadership? See, that's the kind of, that's the sticky business getting down into the weeds. A togetherness agreement helps you get proactive so that you have a dialogue and make those decisions before you ever have to deal with it. Great. Remind us what Anthony and Jenny, some of the things that they worked out.

Yeah. So I, Anthony was 44 year old, very successful construction company owner. And as you said, Ron, he had two boys that he had promised we're going to get the company one day. Unbeknownst to Jenny, however, during their courtship and dating, he didn't disclose. He had a gambling problem with some debt, had a low credit score, had a very controlling ex wife, et cetera. Now on the other side, Anthony didn't know that Jenny had really spent a lot of her hard earned money taking care of her mother who was aging, as you mentioned, and she had promised her that, Hey mom, one day you can come live with me, you know, I'll do whatever I can do to help you get through this.

And, uh, so you know, during the courtship, these things just don't come out so often is the case. And so the first thing that the togetherness agreement dead is it created a arena for disclosure, an atmosphere for full transparency, which then created a mutual respect. Uh, Jenny found out about, you know, Anthony's gambling problem, felt compassion, and they were entering him into a counseling, uh, session to get his credit score up. Meanwhile, they were agreed to have one joint budget account, but to keep two individual accounts until Anthony could raise his scores and get over this gambling problem. They also agreed that though Jenny and her daughter would not receive the company working with an attorney, they would create a trust and place some life insurance in the trust for Jenny and her daughter. They also worked with their agent to create longterm care solutions for the mother and to provide clarity about their future, which really relieved both of them of a lot of stress and reaffirm their commitments to each other, uh, in a way that they really couldn't go that deep without a togetherness agreement. Now theirs was a legal document drafted by their attorney, but I wanted to make this point clear.

Just having the discussion, just sitting down and even just jotting some things on a legal pad or the back of a napkin will create that first step of transparency in disclosure that will then help navigate these, these emotional issues. Hmm. That's so helpful. Boy, we are about out of time, guys. We're going to have to have you back because there are so much more I want to talk about here.

Ron quickly. When should this be done? You know, ideally today. And so if you're dating somebody, now's the time to start having that conversation. And if you're already married and you go, man, we've never really talked about this. I have a lot of assumptions.

We've never checked in with one another. Okay. Then start today. And, uh, the book's designed to help you get a plan and start moving that direction. I love it. It's an absolutely essential tool for a blended family. Gentlemen, thanks for stopping by.

Thanks for having us. Thank you. Pick up a copy of the Smart Step Family Guide to Financial Planning at familylife.com slash blended. Your calls are next 800-525-7000.

That's 800-525-7000. This is MoneyWise Live, biblical wisdom for your financial journey. Stay with us. Hey, thanks for stopping by today on MoneyWise Live. I'm Rob West, your host. We're going to turn the corner and take your questions on anything financial. We've got some lines open, perhaps one just for you.

What have you been wrestling with? Thinking about maybe it's a financial conundrum you're stuck with, or you just want to know if there's something we can pull from God's word, timeless wisdom or principles to apply to what you're thinking about financially today. That's what we do on this program as we gather together each afternoon. The number to call is 800-525-7000. That's 800-525-7000. We've got lines open and we'd love to hear from you.

Great to have Ron Deal with us and Greg Pettis. I'm a big fan of Family Life Blended. By the way, you can learn more if you didn't have your pin handy when they were talking a moment ago.

The website, familylife.com slash blended. What a great resource, including this book, The Smart Step Family Guide to Financial Planning to navigate what can often be really challenging money conversations, which as Ron pointed out are often anything but the money because financial issues are hard issues. You remember Jesus said, where your treasure is there, your heart will be also. Oftentimes we're dealing with the money issues and it's the 10% of the iceberg that's above the water line, but the 90% below the water line is our values and our priorities and our journey, our faith journey with the Lord and all of these things that ultimately should inform how we handle God's money. Oftentimes though, we have a disconnect there. We might take our cues from the world, even though our deeply held values and priorities might direct us otherwise. Well, we need alignment between our finances and the way we handle it and really what drives us, where God is taking us.

And that means we've got to go to our knees and say, Lord, with your resources, what would you have me to do? Well, we want to find God's heart for his money on this program each day. Again, we'd love to hear from you.

800-525-7000 is the number to call. Before we head to the phones, this week we're sharing some of the things we hear every day from listeners like you as you apply these timeless principles. One listener wrote to us just last week and said, I love the radio program. You're helping me save more and spend less. I'm grateful for your biblical approach to financial health.

It is so needed. Valerie in Georgia said, MoneyWise has taught me well over the years and I'm working toward being financially free. Thank you for what you're doing.

And Greg in Tennessee specifically wrote about the app. He said, the app has revolutionized the way I manage the Lord's finances. Glory to God and thanks for all you guys are doing.

Well, do you have a testimony about God's faithfulness and would you like to help us teach and train others? If so, we would invite you between now and December 31st to make a gift to MoneyWise Media. We do what we do because of your generous financial support. So if you're a part of the MoneyWise family, perhaps this broadcast has been an encouragement to you as you handle God's money. We just invite you to consider becoming a financial partner.

It's easy. Just head to MoneyWise.org and click the Give button. And now through December 31st is a critical time for us to meet our ministry goals from listener support so we can not only finish the year strong but also plan for our next year of ministry together.

Again, MoneyWise.org, just click Give and thanks in advance. All right, let's head to the phones. 800-525-7000 is the number to call.

We'll begin today in beautiful Naples, Florida. Hey, Keith, how can I help you, sir? Hey, thank you.

Thanks for taking my call. I have two questions for you. The first is, so I am a full-time missionary. My wife and I both work for the same organization.

So we spend some of our time abroad. So our income is all self-supported. So there's limited income. It's also variable depending on what comes in each month. And so I'm wondering what the best ways to start investing are.

We do have a Roth IRA and I have a 401k through my other job. But just wondering with small amounts of money, what the best way to start saving and planning are. And then I have a second question after that.

Yeah, very good. Well, you know, the key here, I mean, the good news is you're in your 30s and you're already thinking about this. As you said, you have a variable income. So I think what's really important, and this is really the starting point for all good financial decision making, is to begin with that spending plan. We've got to live within our means so we have margin to really accomplish our goals and objectives that align with our values and priorities as a believer, because we're a steward of God's money.

So the question is, what would God have me to do with his resources? Well, we need to start by shoring up that emergency fund if you don't have it, three to six months expenses, and then make sure you're dealing with any kind of short term giving goals. But we also, to your question, need to be using part of that surplus, getting that into long term savings, preferably in a tax deferred retirement environment so that it can grow through the investments with a long time horizon, which is absolutely what you have if the Lord tarries, so that it can grow without the taxes being a drag on those investment results plus any income or dividends that are being thrown off by those investments. So as a target, Keith, I think I would look at trying to get up to 10 to 15% of your income. Now with that variable income, it is important in the budgeting process to really try to base your budget off of a conservative amount each month that's reflective of your true expenses. But in those months where you have a little bit more, perhaps you have everything going into savings and try to transfer maybe a consistent amount every month that smooths out kind of the ebbs and flows of your income so that you can budget a little more effectively. Also, the MoneyWise app can help with that, as you can actually take each of your paychecks and then fund your digital envelopes appropriately based on the income that you're receiving to make sure that every dollar is allocated and then you know exactly what it's for as you spend electronically out of those envelopes that reduces down to zero. But I think the key is let's try to get 10 to 15% going into a tax deferred environment.

I love the Roth IRA, so that's a great starting point. I'd fully max that out each year, 6,000 for you. Through a spousal IRA, you could put in another six. Beyond that, we need to look to other types of accounts. Do you have the ability to do more than 12,000 a year at this point, Keith? Maybe.

It would be really close. We're currently support raising, so if we can get our support fully funded, we would be able to. Okay. Yeah, so I think we ought to just start there and make sure you're fully funding those two Roths.

Perhaps down the road, we could look at some other options to allow you to do even more than that, but I think that'd be a great starting place and I love the tax free growth inside the Roth IRA, especially at your age. Stay on the line. I know you had a second question.

We'll deal with that on the other side of the break. We'll be right back on MoneyWise Live. Welcome back to MoneyWise Live. I'm Rob West, your host, taking your calls and questions. We've got some lines open today.

What's on your mind financially speaking? We'd love to hear from you. 800-525-7000. That's 800-525-7000. Give us a call.

Back to the phones in Naples, Florida. Just before the break, we were talking to Keith. He's a missionary in his 30s, living on a variable income, wondering about the best way to start investing and we were talking about really the critical role a Roth IRA can play if he were to fund for he and his wife 6,000 apiece, 12,000 a year on an after tax basis and get that growing in a solid long-term investment strategy, compounding for the next 30 plus years. You could have quite a bit there, Keith, especially if your income is able to rise over time. You could look for other ways to put some money aside beyond even the Roth and that would be great. But you said you had a second question, so go right ahead with that. Yes.

So my second question is, so I'm Canadian originally, so the American tax system is still very complex to me. And as an ordained minister, I can opt out of Social Security and that's an option that some people take. I know that once I do it, I have to do it for life basically. I think my wife also has to opt out as being my significant other. I'm just wondering about what the benefits or risks are involved with doing that, if that would be something you suggest or not.

Yeah. You know, I think the key here is you really can't opt out just for investment purposes. I mean, the statement that you will sign really indicates that you have a problem from a religious standpoint in terms of opting out of these. And so you really need to give careful consideration to this, both in terms of whether you believe you can, in good faith, opt out based on the statement you will sign with the IRS. And then secondly, if so, does it actually make sense financially? It is a permanent decision. It's irrevocable and you're losing access to pretty important benefits, including potential disability payments for you and a surviving spouse or dependents.

You'll also be denied Medicare coverage when you reach 65, which means you're going to provide the entire cost of the health care, not to mention the Social Security benefits themselves. And oftentimes when folks do this, they don't then take that money and reinvest it on their own on a discipline basis. So they're left coming up short. But I think the bigger thing first is, you know, really what is the basis behind this? Do you understand the rules for opting out?

And, you know, is it something you can sign in good faith just based on what you're attesting to? Does that make sense? Yeah, absolutely. Thank you. That was a much clearer response than I've gotten from anyone.

OK, happy to do that. Listen, Keith, all the best to you. And tell me a little bit just quickly about the missionary work you're doing. Who are you reaching and where is it? Yes, we work mostly in England, but all across Europe in discipleship making movements. So our organization has one of the largest discipleship making movements in Europe, and we're kind of overseeing some of that. So it's really exciting to get to help train new pastors and all that sort of thing.

So it's really neat to kind of go to that what we're calling the new dark continent of Europe as they're so post-Christian. Wow. Well, listen, all the best to you. And we'll ask the MoneyWise community to be praying, Keith, for you and your wife and your family as you do some incredible work there to reach folks with the gospel of Jesus Christ. Thank you for calling in, sir, today.

René in Florida, you'll be next on the program. Go right ahead. How can I help you? Hi, how are you doing, sir?

I have a question. Next year, I would like to get a car because I'm going to be able to reinstate my license. And I want to know how can I have good credit because I never check my credit score. And I know I have some probably, you know, like with the debt collectors, I don't know if that would affect me. And I would like to know how can I get started to build up my credit and pay anything that I owe.

Yeah, very good. Well, I love this question, René, because no matter what mistakes you've made in the past, and we all certainly have plenty of them in a host of areas, including this area of finance, I think the key is recognizing that God owns it all and you're his steward or money manager. And the task that you have is now being found faithful with what passes through your hands. And that means managing what you have wisely, living within your means. And to the extent you have previous obligations that you've not fulfilled, let's figure out what those are. Let's get an accurate listing of not only what the balances are, but making sure we understand who we owe. And then let's make a plan within God's provision to begin to not only continue to cover your own expenses, but also hopefully over time begin to pay these back. And the good news is, as you apply biblical wisdom to your financial advice or your financial decisions, I should say, and begin to make progress, your credit score will actually begin to repair itself. Very practically, René, did you say you have not pulled a copy of your credit report at this point? No, not really, sir. OK, I think that's your next step, René.

I really would love for you to pull all three. So there's three major credit bureaus in the United States, one called Experian, one called TransUnion and one called Equifax. And you can access them all at one website. It's actually a government site that allows you to pull a copy of your credit reports at no cost. And the website is AnnualCreditReport.com.

AnnualCreditReport.com. You can pull those three free of charge. I want you to pull all three and I want you to use that to get an accurate listing of who you owe and how much. And then you need to go back to your budget after you do that and really figure out how can you cut back and get a workable budget that allows you to live within your income and ideally have some margin or some excess, something left over at the end of the month after the bills are paid and, you know, the food's been purchased and everything else so that you can begin to make some progress toward these debts. And it may involve contacting each of these creditors to work out a repayment plan. In some cases, you may be able to just go in and settle them with a single payment at a very deep discount. A lot of times they will, you know, give you 50 cents on the dollar if you're willing to pay it off right now.

And then the key will be to start making all of your payments on time and that includes rent and utilities. If you, you could also look at what's called a secured credit card. This is basically where you'd approach your bank or another financial institution. You'd put a certain amount on deposit.

So let's say $200 or $300. They would issue you a credit card with a limit up to that deposited amount. And then what I would do is find a recurring budgeted purchase that you make every month, something you've planned for.

It's in your budget. And instead of making that payment directly through maybe a check, put it on that secured card. So that means that every month that even very small transaction hits that card and then you pay it off in full. Now, what that's going to do is that's going to be reported to your credit reports that you're an on-time payer. And that's great because that's going to build some positive credit history.

And there's not the risk, Renee, that you're going to go into debt because you can't charge beyond what you have on deposit, that $200 or $300 that you put on deposit at the bank. So that would be another way that you could begin to get this up. So I think those are really probably your next steps.

Get that credit report, make a list of the debts, work on your budget, cut back, try to free up margin, start to work on establishing repayment plans with each of the creditors that you owe, and then open that secured card with one small budgeted recurring charge that you pay in full every month to get that positive credit history going. And I think between all of that, you'll be on your way to getting that credit score up and be able to perhaps purchase that car in no time. Thanks for your call. We'll be right back on MoneyWise Live. Stay with us. Great to have you with us today on MoneyWise Live. Here, our final segment of the broadcast today, back to the phones we go, Chicago, Illinois. Hey, Rosie, thanks for calling. Go right ahead.

Hello. My topic today is that I want to ask a question about my retirement. I retired the past September the 30th, and I have lack of a savings plan. And I have to make a decision on how I should leave it into the plan or take it out.

So I was wondering what was best for me to leave it in the plan or take it out. Yes, very good. Let me ask you a question. How much roughly have you accumulated, Rosie, in this TSP?

Well, it's $150,000. Okay. And you said you're retiring, correct? I retired already September the 30th. I just passed September the 30th. I retired. Okay. That's great. And are you planning to draw a portion of your income from this account or is that covered with other sources? It's covered with other sources.

I don't really have to, but I understand that they tell me that I do have to take a distribution amount each year. Not until you're 72, though. So you've got some time on that. What is your age? 77. Oh, my apologies. I didn't hear that. Okay.

Yeah. So you do have what's called a required minimum distribution, which is basically an amount that you'll have to take out each year. It will come out either as what's called a distribution, which is just where you take a withdrawal of the amount that the IRS tells you you have to take based on the table that's going to be a function of your balance in the account and your life expectancy, which is just what they apply to all Americans based on your age and gender. And then you'll take that out either as a distribution and it would be added to your taxable income for the year or you could give it to charity. So one option is if you were planning to do some giving, let's say, to your church or another ministry out of maybe your savings or your checking account, one option would be instead of doing that, you could make the gift right from what was your TSP. It will become an IRA when you roll it out. You could make the gift from your IRA direct to your church or other ministry and satisfy that required minimum distribution. And then it wouldn't be added to your taxable income for the year, which if you don't need the money, you might as well do that and then just hang on to the cash you were going to send to the church or charity directly. It's called a qualified charitable distribution. But in terms of the larger question, Rosie, I think the next step for you is to hire an advisor who could manage this money for you, somebody that would share your values as a believer, somebody who would have extensive experience. And we trust the certified kingdom advisor designation, which is for men and women who are financial professionals, who have met really high standards and character and competence and experience.

And they've been trained to bring a biblical worldview of financial decision making to their clients. You could find a CKA there in Chicago on our website. If you just go to moneywise.org and click the button that says find a CKA and you can search by your zip code. And then I'd interview maybe two or three CKAs, Rosie, and pick the one that's the best fit for you.

If you have a family member or a friend who helps you with things like this, perhaps you take that person along with you. But once you settle on that advisor, then that advisor would help you roll that money from the Thrift Savings Plan into an IRA, you know, perhaps with Fidelity or Schwab, one of the firms that the advisor uses. And then he or she would begin then managing the money according to your goals and objectives to try to protect what you have, but also grow it without taking an unnecessary amount of risk. How does that sound to you? Now, that sounds good. I just was wondering, you know, should I leave it in or should I take it out, you know, and put it into the bank?

I didn't know what just passed. Yeah, I think especially since you don't need the money, I would probably have an advisor manage it rather than just sticking it in the bank, especially with inflation where it is near the purchasing power. And this money is declining, which means as it sits, it's becoming less valuable over time, which is why you don't have to take a lot of risk. But putting it to work in a portfolio of maybe largely bond type investments that are fairly stable, especially once interest rates start stop rising, that throw off a good bit income and maybe a very small portion in stocks, they could give you a little bit of growth over time and then allow you to use it for whatever purposes God directs you, whether that's, you know, an inheritance or further giving now or at your death or if you need it. Let's say you needed some long term care, assisted living or a nursing home, which can be very expensive. We want this money to be available to fund those expenses as well. So from my standpoint, I think that would be the next decision for you.

If it sounds good to you and you'd head to money wise dot org and find a certified kingdom advisor in your area. OK, OK. Thank you so much. All right, Rosie. God bless you to Indiana. Hey, Karen, how can I help you?

Go ahead. Yes, I got to make up my mind with his whole life insurance policy. I'm a 68 and I've had it since, I believe, 1985. And I've got a loan on it around six thousand dollars. But my cousin said that hers jumps so extremely high, she couldn't even afford it.

I know when I turned 65 and it doubled, I'm paying about 80 a month plus the interest once a year. OK, I don't know where to just dissolve the thing and because it was going to be my death benefit to my girls to bury me and then have what's left. Yes, I only have social security and a part time job. I see. Are there other assets now, Karen, that could be used for funeral and burial expenses? Only thing is I own a home clear and I got to get things situated with that, too, into a will or whatever it takes. I have it.

I don't have any really much funds because I was I didn't manage right with what I did. No problem. Yeah. And how much cash value has built up in this policy? Do you know?

I'm not sure. I thought it just said around two thousand dollars. I know that's not very much.

Yeah, I'm sure I did see something around ten thousand dollars, but I don't know. Well, that would be your next step, because here's the thing. You're well past any penalty phase for surrendering this policy. And if you don't need the death benefit anymore because you don't need to cover someone else who depends upon you for income, then you could surrender the policy and put that cash to better use, including just setting it aside for funeral and burial expenses.

And then you do some pre-planning, not necessarily prepayments, but pre-planning for your expenses or for your funeral and burial, making those decisions for your daughters so they wouldn't have to at that time. And then you won't get hit with any kind of fees for surrender. You'd have to pay some taxes on the gains in the policy beyond your contribution, if there are any. So I think that might be a better option. And then you're not continuing to pay for this policy for this death benefit, which is going to become increasingly expensive over time. And then you'd have the money available for the girls. And once you do that, pre-planning and get that will in place, which you really need to do.

So the state is not making the decisions on your distribution of your estate, but you are, then I think you'd be in a great spot and not continuing to pay for this expensive policy in the future. Yeah, that's why I'm leaning towards my cousin was stressing that to me last week because of what's happened with her. And then I'm wondering if a CK advisor would help me know who did contact to do with a will to make sure the kids divided stuff evenly. Three of them are stepdaughters and one of them is a biological daughter, but I didn't raise her. Yeah, I see.

Yeah. Just contact a certified kingdom advisor there in Indiana and ask for a referral to a godly estate planning attorney. They'll all have one that they use and you can find a CK at MoneyWise.org. Just click the button that says find a CK. Thanks for your call, Karen. Quickly to Ohio Paul. Just another couple of minutes.

How can I help you, sir? Hi, quick question. I owe some money to the IRS for last year due to my wife's filing when we separated, unfortunately. And long story short, we're back together.

Everything's good. But because we filed independent at the file as well, independent. So I owe money because I cut it right off my daughter. So I owe about thirty four hundred dollars. And I'm wondering how much time do I have and should I just take care of this with a CPA because I tried contacting the IRS, but it takes like three and a half hours wait time and I don't have time, unfortunately. Yeah, yeah, absolutely.

So you definitely want to get this taken care of. You're right that the IRS is just slammed right now. It's in part because of covid and the backlog, all the tax incentives that were given out during covid.

They are just way behind on everything from refunds to just general customer service. You can work with the IRS to get this paid back either on a payment plan or in a lump sum, depending on what you have the ability to do. But I think this is a great example, Paul, of where you do want to get a CPA or enrolled agent who can represent you and really help you determine, first of all, what is actually owed just based on your filing status last year and then help you work on either establishing that repayment plan or just getting that lump sum paid back. So I think that is your next step, my friend. And I would definitely use a CPA or EA to get that done on your behalf.

I think you'll you'll not only make sure it's taken care of properly, but it'll be a big load off your shoulders. So, hey, so excited to hear that the Lord has allowed you and your wife to reconcile, that you're staying together. That's God honoring. And I know that pleases the Lord and I'm delighted to hear it. God bless you, my friend. Thanks for calling today. Well, folks, that's going to do it for us. So thankful you were along with us today.

MoneyWise Live is a partnership between Moody Radio and MoneyWise Media. I want to say thank you to Luke Costaldo, Amy Rios, Deb Solomon, Sahara Hayes and Jim Henry. Come back and join us tomorrow. We'll see you then. Bye-bye.
Whisper: medium.en / 2022-11-17 18:10:14 / 2022-11-17 18:26:38 / 16

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