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Not All Savers Are the Same

MoneyWise / Rob West and Steve Moore
The Truth Network Radio
January 12, 2023 10:47 am

Not All Savers Are the Same

MoneyWise / Rob West and Steve Moore

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January 12, 2023 10:47 am

You want to save more, but you don’t think you make enough. So, is earning more money really the answer? On today's Faith & Finance Live, host Rob West will explain that the amount you save doesn’t have much to do with your salary, but rather depends on what kind of saver you are. Then he’ll answer your calls on various financial topics. 

Also, John Putnam joined us to talk about setting financial goals for to practice better stewardship.

See for privacy information.

Rob West and Steve Moore
Rob West and Steve Moore
Rob West and Steve Moore
Rob West and Steve Moore
Rob West and Steve Moore
Rob West and Steve Moore

So you want to save more, but don't think you make enough. But is earning more money really the answer? Hi, I'm Rob West. You might be surprised to hear that how much you save doesn't have much to do with your salary. And there's data to back that up. I'll talk about it today and then it's on to your calls at 800-525-7000.

That's 800-525-7000. This is Faith and Finance Live, biblical wisdom for your financial decisions. Well a study by the Employee Benefit Research Institute and J.P. Morgan sheds light on people's saving habits and why some folks are successful at it and others aren't. It defined three different levels of savers. What they called low savers managed to put away about 2-3% of their salary. The next category, middle savers banked 5-6% of their income and high savers were consistently saving about 9% of their salary. So middle savers put away about 3% more than low savers and high savers 3% more than middle savers. Now, those are savings rates not income rates. In fact, they have nothing to do with income. The research showed clearly that people often with identical incomes saved at different rates and not necessarily more than folks earning less.

Simply put, there's no link between income and saving. This helps explain why financial author Ron Blue describes as a consumptive lifestyle. That's when folks who earn more spend more. Instead of banking all or part of a raise, they tend to increase their lifestyle and spending. It may also explain why savings rates actually went up during the COVID shutdowns.

As people saw their income reduced or even just threatened, they cut back on spending to save more. Of course, the Bible says we should do this all the time because we never know what the future may bring. In Proverbs 6, we find, Go to the ant, O sluggard, consider her ways and be wise.

Without having any chief, officer or ruler, she provides her bread in summer and gathers her food and harvest. The message there is that saving isn't complicated. You just can't be lazy about it. It's easy to let your spending creep up as you earn more money.

It takes discipline to prevent that from happening. If you've fallen victim to the consumptive lifestyle, try this. Pledge to bank any type of future increase you receive, whether it's a raise, a tax refund or even a gift card.

Go ahead and use the gift card on budgeted purchases, but move an equivalent amount into savings. And in the meantime, how do you move from being a low saver to a middle saver or middle to a high saver? Well, the research showed that you can get the most bang for your buck by concentrating on three key areas. First, high savers tended to focus their saving efforts on housing.

That includes a mortgage, a rent, taxes, utilities and home furnishing. Look for ways to save there. Second, see how you can cut spending on food, both eating out and groceries.

And finally, trim the cost of transportation, which includes vehicle purchases, fuel and maintenance. Constantly looking for ways to cut costs in those categories could move you into the next higher bracket of savers, and that 3% increase will have a huge impact over time. The research showed that retirement account balances of middle savers were twice as large as those of low savers.

The researchers also posed this question to respondents. Would you rather save $150 a month, $35 a week or $5 a day? Four times as many people chose to save $5 a day rather than $150 a month, even though it's the same amount.

And that was consistent across the various income ranges. The bottom line is that, psychologically, it seems easier to give up something that costs $5 a day. Keep that in mind when you're looking for ways to cut spending. It's helpful to write down every penny you spend for at least a month.

Three would be better. As you do that, look for small repeat purchases that you can live without. You'll probably find that saving $5 a day is pretty easy.

Just don't tell yourself that you're actually saving $150 a month. And if you need help with this, well, why not download the FaithFi app? It can help you set up your budget in three different ways depending on your management style. It will also track your spending and alert you when you go over in a category. You can download it at

That's or wherever you get your apps. Increasing your savings, even by just a little, will make a big difference in the long run. We hope this helps you move up into a higher saving category. All right, your calls are next. 800-525-7000. That's 800-525-7000.

Much more straight ahead. Great to have you with us today on Faith and Finance Live. I'm Rob West, your host. We're taking your calls and questions today on anything financial. It's time for you to pick up the phone and tell us what you're thinking about today financially speaking. The number to call is 800-525-7000.

That's 800-525-7000. The lines will fill quickly and so we'd love for you to get in on the conversation. Coming up a little later in the broadcast, my friend John Putnam stops by. John is a financial coach, a certified kingdom advisor.

He's the founder of and he's going to share some thoughts on goal setting as a believer, specifically in this area of finances, perhaps in a way that you haven't thought of before that may actually stick and allow you to accomplish your goals. That's coming up a little later in the broadcast. But let's head to the phones and dive right in. Biola, Iowa. Hey, Keith, thanks for calling, sir.

Go ahead. Yes, I have a relative that's listed as a beneficiary on some of my accounts, but he's going to be declaring Chapter 7 bankruptcy and also maybe applying for Medicaid. And some of my other relatives say you better take him off your beneficiary list because the bank or the state or whatever will get the money.

You know, I'm not an attorney here, Keith, and so it's always good to get legal counsel. But I would just say, you know, somebody who's a named beneficiary on an insurance policy or a financial account doesn't actually own those assets. So I just don't see any way a creditor could attach the assets that the borrower doesn't yet own. Now, obviously, if you pass away and that becomes his asset, then that would be available to be attached on the part of a creditor during a bankruptcy hearing. But at this point, that's your asset, even though you've selected him as the beneficiary. But again, never a bad idea if you've got something like this in question to reach out to a competent, godly estate attorney or some other lawyer that could weigh in on this.

But I just don't see how that's possible. Okay, thank you. Yeah, Keith, thanks for your call today. 800-525-7000 is the number to call. Let's head to Tennessee.

Marsha, you're next on the program. How can I help you? Hello.

Hi. My question is, I retired a year ago. And I had a 403b account. And it is still in the account where I retired from. And I was just wanting some advice as to what to do with that.

Yeah, I'd be happy to weigh in on that, Marsha. So you retired the 403b is sitting with the current plan administrator. And give me a sense of how much roughly is in this account. I'm not exactly sure. And I know it's a smaller amount.

From what most accounts I've heard of, it's around 50,000. Okay, very good. And do you have any other investable assets other than this 403b? No, I do not.

Okay. And so you're retired and you're living off of Social Security alone? Or do you have other income sources? I have a part time job.

Okay, very good. And are you continuing to save? I guess I'm just wondering, you know, when you get to the point where you redirect toward, you know, unpaid work or you're unable to work, what you're going to use to cover your expenses at that point? I just live off of my Social Security right now and my part time job. I haven't touched my investing.

Yeah, very good. And have you done a budget, Marsha, to see what it takes you to fund your expenses for a month's time, and perhaps even an estimate of what that might look like once you fully retire? And here's why I ask is, you know, oftentimes folks will live on somewhere around 80% of their pre-retirement income in retirement because their taxes have gone down. Maybe they've dropped their life insurance. They're not driving as much because they're not commuting to work.

Maybe their clothing budget changes or they're not eating out, you know, during the day, during lunch. Have you looked at that? And guess what I'm getting at is I'm trying to determine, do you think there's going to be a gap between what it costs you on a monthly basis and your Social Security that you'll need to make up once you lose your part time job income? By that time, I think probably I would be able to live on my Social Security.

Okay, yeah. Well, I would do some work on that just to make sure that's the case and really think through that budget, what changes might occur there. Maybe you have some debt that you're still working on paying off that, you know, will be off the table. I'd try to save diligently as well because I'd love for you to have an emergency fund of at least three to six months expenses. But going back to that 401k, the best option would probably be to roll that out to an IRA, an individual retirement account.

It's going to give you more control over the fee structure on how it's managed, whether that's something you do yourself or you hire somebody to do it for you. And you're going to have unlimited investment options at that point. Inside the 403b, you're limited to a menu of choices that are available inside that retirement account.

As soon as you get it into the IRA, you essentially open it up to any stock bond or mutual fund and you can even go beyond that in some cases. So I think that would be perhaps my next step. You'd want to decide though how you're going to go about managing it, whether that's just selecting kind of a target date fund or a good high quality balanced mutual fund or you want some more direct advice on that.

Our friends at could be helpful there. Their Soundmind Investing newsletter would give you some really helpful and their website as well will give you some really helpful suggestions on the mutual funds to select at that point and that would give you some guidance if you're looking for that. You could consider hiring an advisor although 50,000 in investable assets is often perhaps slightly under what a typical advisor might require as a minimum. The other option would be more of a robo advisor solution where you're essentially completing a questionnaire and that algorithm based on your responses would generate a very low cost, highly diversified portfolio of what are called exchange traded funds indexes. And then the other option would be a bank. If you wanted to put it in more fixed income type options like CDs or other banking products, you could roll it to an IRA at the bank.

It really just is a function of whether you want to try to get a little bit higher return by taking some risk although you certainly in this season of life wouldn't want a risky portfolio or you want to stay on the more or most conservative end of the risk spectrum and use banking products. Does all that make sense? Yes, it does. And another question I had was about that exact thing. I saw a local bank has CDs now offered for 4.3%. And I was questioning whether to take part of that and put it in a CD. Yeah, and you absolutely could do that. You could use a CD at a local bank, you could roll it out to a Fidelity or Schwab and use a money market as well. You know, some of those like I was just looking yesterday at a government money market made up of government bills, bonds and notes at 4.8.

So yeah, we're in a season now where this hasn't been the case in the past, but because interest rates have moved up in light of inflation, you can get that 4.3 to 4.8% with CDs and money markets. So you could look at that as well. And if you wanted to stay with a local option, perhaps that one that you found would be just what you're looking for.

So hopefully that gives you some thoughts. Once you decide where you want to put it, go ahead and open that IRA and then contact your 403b administrator. They'll give you the rollover paperwork. You'll put in that new account number and all the information it asks, and then they'll transfer the cash over.

It won't be a taxable event. And then at that point, you can redeploy those assets in the CDs or stocks and bonds, mutual funds, whatever you'd like. Thanks for your call today, Marcia. We appreciate it.

$5,000, $7,000, a quick break, and then back with more questions right after this. Delighted to have you with us today on Faith and Finance Live. I'm Rob West. With me today in studio as we take your calls and questions is my good friend, John Putnam. John is a wealth counselor and coach. He's a certified kingdom advisor. He's also the founder of Smarter Stewardship.

You'll find it at It's a marketplace ministry with content, tools, and resources equipping you to be a wise and faithful steward of God's money. He's a good friend, and he was in the office today. We were meeting on several things, and I said, John, why don't you stay and we can hang out on the radio as we do the program today? And he graciously agreed. So, John, great to have you here. Oh, it's great to be here, Rob.

Thanks for the invitation. Absolutely. Before we get back to the phones, John, you and I have been talking today somewhat about goal setting. You know, here as the calendar turns, it's a ripe opportunity for us to say maybe there's some goals in our life, and some of those are financial, and yet we know the stats on how ill-equipped we are to make and accomplish goals. So as believers, what thoughts do you have about how we can perhaps increase our effectiveness there?

Well, Rob, you nailed it. The opportunity that we've got every year, right, with this fresh start, so many people want to create new goals. They want to set new goals and objectives and dreams for the year, but so often it doesn't happen.

There's some recent study that was done. It was an Inc. magazine research that said that 92% of New Year's goal setters do not achieve their goals. That blew me away, and I started thinking, you know, with just a little bit of focus on this, we can increase our chances for goal achievement so we can move up our chances of actually reaching the goals by what I call putting in together three goal superchargers, setting a mission, setting a vision, and setting the values.

Now, we do this every day so naturally, but we don't really call it this. You know, any time if we're going on a beach trip for a vacation, for example, think about the vision as where you're going to go, the destination. Think about the mission as the route. It's how you're going to get there, and think of the values.

This is who you want to be on the trip. This is the behavior of this. So when you put all of this together, you get these three pieces together, it creates a wonderful, strong cord of goal setting achievement, and the way you approach it increases your chances of achieving the goals you set. Well, I think it'll be helpful to put a real example of an actual goal into this model and talk through what that might look like. We'll do that with John Putnam in just a moment. Let's head back to the phone.

Sioux City, Iowa. John, you'll be next on the program. Go ahead. Great.

Hi there. I'm kind of lucky. I got some money from my parents for Christmas.

They're a little bit wealthy, and they give that to us kids during Christmas. I got about $32,000 last year and this year. Last year I put it in with the stock market, and then the stock market went down. So now this year I'm a little leery of doing that again. I've got an emergency fund.

I bought $10,000 in an I-bond, so I'm doing okay, but what would you suggest I do to invest this money this time around? Yeah. What do you think?

Absolutely. Well, it's incredibly generous of Mom and Dad to give you all this gift. I love that, and I can certainly understand last year you put it in the market. It turned out to be, after a 10- or 12-year raging bull market, a pretty tough environment for stock and bond investing without question. Let me ask you, John, you said you've got your emergency fund fully funded. Have you set aside some retirement funds? Are you currently contributing to long-term retirement savings?

I'm retired now, and I've got a pretty good-sized portfolio, plus I work in education, so I have a pension. So I'm doing okay. Okay. So this really is truly surplus, and this is money you wouldn't expect to touch in the next 5 to 10 years, is that right? Yeah, yeah. That's correct. Okay.

So, John, what are your thoughts on this? Well, listen, the market, you don't know if it's going to go further down or if it's going to come back up. It's so funny that when you're thinking about investing in the stock market, it's the one thing that nobody wants to buy when it's on sale. Yeah. Isn't that true?

That's right. And right now, if we were staying with it going down, it could be, quote, unquote, a little on sale, could be a little undervalued, could be a little bit more value in the option. But again, what you said was exactly right. You've got that 5 to 10-year time horizon, and you don't have to put it all in at one time. You could go ahead and get it into an account and then dollar-cost average that in over a period of time to take even more advantage of a strategy such as that to give you a better chance.

Yeah, I think that's exactly right on, John. I'd probably take what you did last year and just as John said, go ahead and dollar-cost average maybe over the next three months, this new round of gifting that you received into either the same investments or something similar to take advantage of the fact that you're buying these stocks and bonds and whatever else on sale. And as long as you've got a time horizon, we have no idea where the market's going in the next quarter or even the next year or two. But given that you have time on your side, if you take a disciplined long-term approach to this, I think you'll be rewarded handsomely. I think that's probably your best opportunity at this point.

Does that make sense? Oh, yeah, for sure. That's what I kind of did with the money last year. So, all right, I like your suggestion. I'll do it again this time. Even though it feels scary, that's what I'll do. Thanks. Yeah, very good. John, you were talking, Putnam, John Putnam, you were talking just a moment ago about goal setting.

We've got 60 seconds before the break. Give us an example of what that looks like for vision, mission and values if we were to apply that. Well, for example, you think about vision as where you want to go. So many times people will make a comment such as, I want to be more generous this year. And that's vague. It's more implied. It's directionally good, but it's not focused.

It's not intentional enough. But I'd rather see people think more about their actual results, such as rather than just being more generous, I would like to make sure that 5,000 people have access to clean water and living water in this year and let that be the vision. And then from that, come back and determine what needs to be true in my financial stewardship to help make that a reality. Wow, wouldn't that change things a bit?

If you look at that and set the goal in light of your vision and your mission and your values, and maybe now you're putting away $50 a month, but you know why, and you know what it's ultimately going to accomplish, perhaps that alone could help you be far more successful in actually achieving your goals. Why don't you give that a try this year? We're going to take a quick break. Lynn, Kathy, Leah, we're coming your way just around the corner. Stay with us.

We'll be right back. Great to have you with us today on Faith & Finance Live here on Moody Radio. I'm Rob West. Sitting in with me in the studio today, my friend John Putnam. He's the founder of He's the author of He Spends, She Spends. He's a financial wealth coach and a certified Kingdom advisor. He's also a great friend. We're taking your calls and questions today.

We're also talking about goal setting here in a new year. Let's head right back to the phones to Holland, Michigan. Steve, you're next on the program, sir. Go ahead. Yes. Hi. Thanks for taking my call.

I had a question. We are looking at buying a rental property, an income property two unit. We would be looking at putting a mortgage on it and putting 25% down. The down payment is kind of the question. We have an opportunity to utilize a home equity line of credit type thing or take funds out of a Roth IRA that we have. We are both retired and pass for retirement age. Just kind of wondered what your thoughts would be on that.

Yeah. So your retirement assets are what? Well, I'm trying to get at your income sources. Income right now is full social security for both my wife and I.

It's in the neighborhood of about $4,300 a month. Okay. All right. And anything else paying your retirement income? No, I have a small part-time job.

It's maybe a couple of hundred a month. Okay. All right. And do you have an emergency fund that you've set aside in the emergency savings? Yeah. We have about $15,000 in checking and savings.

Okay. And are you relying on the rental income, Steve, in order to service the mortgage? You mentioned home equity line of credit, which I'm not going to be a fan of. We'll get to that down payment in a minute. But on the 80% or 75% that you're financing, are you able to cover that out of current cash flow or are you going to require the rental income to do that? We would be looking for the rental income to cover that. Yeah.

Yeah. That's my only concern here, Steve, is that it sounds like we're stretched a little thin. I mean, I'd love for you to say, you know, Rob, we've got the six months expenses in liquid savings. We've got the down payment also in a liquid account.

Now, granted, yes, you can pull from that Roth IRA and that's not going to be a taxable event as long as it's been in there long enough. But the fact that we're relying on that rental income to service that debt on that property, and I'd love with a rental property for you to have closer to 40% to 50% in equity, but you're talking about 25% in equity. What if we were to get into a more severe or a bit of a deeper recession this year than expected and that rental income that you were counting on is a little harder to come by or you get a tenant in there and all of a sudden they bail on you and walk away and, you know, now you're struggling to find somebody else.

I feel like given the fact that we're living on Social Security alone without the ability to service that debt, just could you put you in a real hardship situation? I mean, granted, if everything worked out okay, I love the idea of you having real estate to build equity in that property, allow somebody to help you do that through the rental income. I just feel like things are a little too tight and we may put your financial foundation at jeopardy here just given the things that I'm hearing, but give me your thoughts. Yeah, I hear, I guess that does make me pause and I guess that's why I wanted to speak to you about it. I do feel it's a solid rental property.

It's in a very good neighborhood. We know the current owners and they've done a lot to the property and it has a very steady income that I don't think that would be a problem. You know, we never know, but that would be, you know, an issue certainly if we had a problem there.

Yeah. Do you have any margin left on a monthly basis after the bills are paid? We've got a little bit, yeah, maybe a few hundred.

It's not like we have a whole bunch, but there's a little bit there. Well, as good as this sounds, Steve, I'm just a little hesitant on you all proceeding. The end of the day, you need to pray through it and make that call, but I would put up enough of a caution to say I'd probably step back from this. Let's focus on trying to build up your fully fund your emergency reserves as much as I love you having a diversified asset class with real estate here as a part of the equation. I just don't want that call six months or a year from now when we're in a really tough spot economically here in this country if we are, and I certainly don't know where we're headed, but if we were to be, I wouldn't want you all to put yourselves in a real financial hardship.

So I'd take a step back, think it through, pray about it, but for me, I'd say let's not proceed, Steve. We appreciate you checking with us, sir. We'll ask the Lord to give you some wisdom.

God bless you. 800-525-7000. We have a few lines open today. We'd love to hear from you. Before we head back to the phones, Jon, you and I were talking about goal setting here in the new year. You said, what if we bring our mission, our vision, and our values? Where are we going?

How are we going to get there? And who's going to be on the journey with us into the goal setting process? You gave an example of rather than just saying maybe we're going to give more this year, what if we were to match it up with a vision around perhaps having 5,000 people receiving clean water and the living water and then quantifying that as perhaps $50 a month that you were going to give away, and now all of a sudden we're sacrificing the short term with a clear picture of why, and that might change everything. What else might you add to that as we think about goal setting? Well, what I would think about is how do you go about actually structuring the goal? So often it's that, hey, I just want to do $50 a month, or maybe it's $50 a week. So you do a little homework and you find out, well, what would that cost to do that through the charity of your choice?

And then you can back into it. But thinking about this SMART goal framework that is so commonly developed ages ago, where these goals are specific, they're measurable, they're actionable, they're a little risky, and they're also time keyed. So all of a sudden be more generous turns into, well, I want to help these 5,000 people with fresh water and the living water this year. And now you think about what does that look like with your mission?

What would have to be true for you to accomplish that goal? And you say, well, increase my giving. Now all of a sudden it's actionable by, say, $50 a week. Or maybe you say, you know what, that's not that risky.

Maybe it's $75 a week just gives you those good kind of butterflies. And then you time key it with, say, starting March 1st of 2023. So now it's specific. You know exactly what you're doing. You can measure it so you know your own track. It's actionable because you're thinking about the increase.

It's a little risky and it's got a time trigger on it. So now all of a sudden you've combined a very clear goal with a very clear vision. You add to that your values. This is the type of person you want to be on the journey. And the beauty of this is, is that if the objective, the charitable objective is more than what you are personally putting away or can do, this is where you can invite others into this ministry mission with you, with these goals and objectives. I love that because now we're bringing, as you said, people along with us. We're getting the community around us involved. We're saying, listen to this vision I have, and perhaps we can do this together.

And now all of a sudden you guys are walking arm in arm toward this vision that God has given you. And man, what an incredible opportunity. John Putnam belongs today.

He's the founder of smart You should check it out. When we come back, we're going to do a lightning round of questions. Lynn, Kathy, Leah, we're coming your way. And perhaps your question as well at 800-525-7000.

We'll take a quick break. You're listening to Faith and Finance Live. I'm Rob West with John Putnam today and more to come just around the corner.

Stick around. So great to have you with us today on Faith and Finance Live. I'm Rob West. This is the program where we recognize God owns it all and we're stewards or managers of the resources of the King of Kings.

So money now becomes a tool to accomplish God's purposes so we can hold it loosely and give it generously and experience all that God has for us as we align our values and our priorities with our spending decisions each day. In just a moment, we're going to head back to the phones. Before we do, John Putnam in the studio today, my good friend and founder of John, you've been talking about a goal-setting process and if somebody wants to go deeper in this, you actually have a resource for them, don't you? Yeah, we really do. So I'm doing a five-part series.

I'm getting more and more of this from people. So we're doing a five-part series. The podcast is called Wherever you listen to your podcast, you can find it starting at episode 63. So we're two episodes in right now, some worksheets on You can join in the next three. We're going to be digging into vision, mission and values individually, helping people really keep this simple and keep it impactful for this year. I love it.

No cost to any of it and I guarantee it'll help you make smarter goals and goals that are aligned with your values as believers this year. Check it out. All right, back to the phones. Lynn, you've been incredibly patient there in Alabama. How can I help you?

Yes. I had to retire pretty quickly. I was going to retire when I turned about 62 and I'm 60 years old. Well, I had a pension that was $575,000, but it hasn't been cut any taxes or what have you.

And I also have a 401k. I really don't know which way to go. And my issue is trusting someone to handle this for me because I didn't have time to plan.

And I have a financial planner that has reached out, but I really want to trust someone with this because I really don't know what to do. Yeah. Well, I totally understand where you're coming from and this is a significant sum of money. You spent your entire working life building this up.

Now you have this tremendous nest egg. You're now moving into this really exciting season of life where you can ask the Lord what's next and pursue what he has for you in this next chapter. But having somebody who can help you manage these resources faithfully and aligned with your values and priorities but also with understanding God's heart as it relates to money, I think is really going to be key. Might I suggest the Certified Kingdom Advisor designation for you, Lynn? This is really the only industry designation in financial services for men and women who've met high standards in training and competence and experience and integrity, pastor and client references, but they've also been trained in a rigorous training program to bring biblically wise financial advice. There's more than 1,300 Certified Kingdom Advisors around the country. There's plenty of them there in the state of Alabama and so perhaps as a next step, I would head to our website, That's and just click find a CKA.

Do a zip code search. I'd probably find two or three that you could meet with and sit down and see which one you have a good rapport with and perhaps the Lord will make it clear the direction you should go, but there's no doubt that God's Word says, you know, we should seek wise counsel and I think in your situation that'll give you the peace of mind that you're looking for. How does that sound? That sounds great, but would you advise that for me to vote that money over temporarily to an IRA? That's what I was told, or something to… Yeah, I would probably wait if you're planning on doing this right away.

It doesn't have to happen the next few days, but in the next few weeks. What that's going to avoid is if you were to roll this out to an IRA, the 401K and the pension, you'd have to just select a brokerage firm and go open an IRA that could be the recipient of that rollover so you don't create a taxable event and you may have to then immediately open another one once you select the advisor, depending on where he or she custody's the assets that they manage. So I'd probably select the advisor first, leave these assets right where they are and wait.

Is there any reason why you were thinking you should do that more quickly? Well, that's just some advice that was given that I should do that because, like I said, when I part from the company, it just can't sit there. You shouldn't have any trouble. You could call the HR department. The 401K should be able to stay right where it is without question. The question would be how quickly that pension needs to roll out, but I would think you should be fine there as well.

So I would just quickly move toward finding that advisor and then have that advisor open the IRA for you and then at that point request that rollover. Again, head to our website, and just click find a CKA. Thanks for your call today to West Palm Beach, Florida, WRMB. Kathy, you're next on the program. Go ahead. Hi. Yes, I'll try to keep it short. I have everything.

Check, check, check, check everything that you tell us. The emergency funds, putting money in the 401K, all of that. But I have $5,000 that I either want to put into a CD or maybe take the chance on the I bond because of the interest rate right now. I understand it has to stay there for a year, but what long term, which would be the better direction, the CD because interest rates are just under 5% or, or the I bond? Yeah, I think you could go either way long term.

I don't think the I bond would be great. I think it's going to revert back to where it historically has been because the Fed is all but said they're laser focused on getting it down to their target of 2%, even though that's going to be challenging this year. But you're probably going to end up with about a wash there right now. The I bonds, if you were to put 5,000 in an inflation bond today at treasury, you'd get 6.8% for the next six months. And then it would change to whatever the new rate is in May. It's undoubtedly going to be lower than that. It might be slightly higher over 12 months with the 6.8 plus whatever we're going to see as the new rate pegged to the consumer price index in May.

It might be slightly higher than the 4.3%. You could get on a 12 month CD right now to compare apples to apples, but I think you could go either direction on that. So if you were interested in the I bond, that would be a great choice.

You just had to treasury, open the account and then transfer it in. Or if it's simpler, just to look for an online bank, perhaps that's paying an attractive CD rate of somewhere around 4.3 to 4.5 for 12 months, you could do that as well. Would it make sense to do the one year with the I bond and then take that money and put it into a CD at that time?

You certainly could. I mean, the downside there is that you'd have a penalty of three months worth of interest if you pull it out in less than five years. So that's going to eat into that return.

So if you were planning on pulling it out after 12 months, I might opt for the CD just so you don't give up that three months out of 12. My mistake. I actually thought it was one year minimum. I did not realize it was five. Well it's a one year minimum, so you absolutely have to leave it there for a year. But if you pull it out in less than five, you can do it.

You're just going to have a three months worth of interest penalty on it. Okay. I see. Okay.

All right. Very good. I thoroughly enjoy your ministry. It's been extremely helpful. Well thank you. That's very kind of you. God bless you, Kathleen. Kathy, quickly to Illinois. Leah, how can I help you?

Hi. So I have a question basically about fiduciary versus non-fiduciary. I'm currently a widow and self-employed with a low income. I'm getting his Social Security and pension. Right now I have his money in a large bank with managed accounts with a fiduciary. Last year I lost $30,000. My sister didn't lose that much and she has a non-fiduciary.

So I was wondering what you think I should do. Yeah. Whether you make money or lose money is generally not going to come down to whether you have a fiduciary or not. That just has to do with how the advisor operates. And as a fiduciary, they have an absolute requirement that they have to put your interests above their own, which you might say, why wouldn't I want that?

And I would agree. And I think that's why you'd want a fiduciary. But that really isn't going to determine the performance on your investment accounts.

That's going to come down to the investments that are selected in the account, which you're going to need to sit down with that advisor and determine what makes the most sense given your age and goals and objectives. Do you follow that? Yep. Okay.

Very good. Well, Leo, we appreciate your call today very much. Thanks for checking in with us.

Well, John, I really appreciate you stopping by today. I know we've covered a lot of ground. And what final thoughts do you have for us as we tie a bow on this today? Well, I would just say, just when we think about vision, Proverbs 29, 18, it says, Where there is no vision, the people perish. You know, we don't want to be wandering aimlessly with the resources that God's put in our hands. So when you get the vision right, you get that point on the horizon, you set up the goals of how you want to get there, and then you set up the values, your basic structure of how the type of person that you want to be on the journey gives you just a great chance to supercharge your goal achievement. Well, I think that's so key. And I'd love for you to check out the podcast series that John has put together, Change for Your Dollar. And it starts at episode 63, right?

Yeah. So if you head to or his brand new website,, you can access these great free resources to help you in your goal setting here in a new year. And perhaps as you consider your goal setting slightly differently, maybe we'll get the chance of success up quite a bit and improve upon your odds from those statistics you shared with us. John, thanks for stopping by. Great being with you, Rob.

All right. Hey, let me say thanks to my team today. Couldn't do it without them. Thankful for our engineer today, Amy Rios. Producing today was Tahira Haynes providing me with great research, Mr. Jim Henry.

Handling our phones today was Ryan Hansen and running the entire operation from Chicago, Elise Haynes sitting in the driver's seat today. Folks, thanks for being along with us today. Faith and Finance Live is a partnership between Moody Radio and Faithfi. Hope you'll check out our brand new website,

You can download the new Faithfi app while you're there. Have a great rest of your day. Come back and join us tomorrow. We'll see you then. Bye-bye.
Whisper: medium.en / 2023-01-12 12:10:36 / 2023-01-12 12:27:30 / 17

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