Recession Proof Your Finances

Are you worried about a recession? Many economists say we're likely to have one in 2023.

Hi, I'm Rob West. The Federal Reserve's raising of interest rates to fight inflation is a recipe for slowing the economy. In other words, recession. Are you prepared for it? If not, now's the time to get started. I'll talk about that 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. So far, the GDP is still in positive territory, although not by much, and the unemployment rate remains low.

That's a blessing. But higher interest rates will inevitably slow the economy, so it's time to recession-proof your finances. How do you do that? Well, step one, check your credit score and get your credit reports. This will give you a base point and will allow you to accurately judge the effect of any late payments if you're forced to make any in the future. You can get a free credit report from each of the three bureaus, Experian, TransUnion and Equifax at AnnualCreditReport.com. With those reports in hand, you'll be able to show creditors that you've made timely payments on your various accounts in the past.

That could help you negotiate better terms if you find yourself temporarily out of work. Step two, familiarize yourself with the May Day budget. It has only four categories. The first is food. You have to eat, but keep it simple and no eating out. The next May Day budget category is housing. Make your mortgage or rent payment. Then comes utilities and finally transportation.

So food, housing, utilities and transportation come first in the May Day budget. With anything left over, you can pay other bills. Step three is to look for other sources of help. Your unemployment benefits may run out, but other resources will probably be available. Check out nonprofit organizations and local government agencies that may have assistance programs.

You can call 2-1-1 to learn more about services in your area or go online to 2-1-1.org. Step four, make a list of all your creditors and their contact information. Be ready to call them and explain in detail whatever financial situation you may be facing and then pray you don't have to use it.

But if you do, it's ready. If you can't pay a bill, call your creditor before it comes due. Run toward your creditors, not away from them.

When you call and speak to a representative, have your latest pay stubs handy so you can show how your income has been reduced. Tell that person how much you have available to pay on the debt for the time being. Ask if you can temporarily stop payments or make partial ones. Let them know how long you expect to be in your current situation. You may not know for sure, but try to give a reasonable estimate of how long it will take for you to begin making full payments on time again.

Make sure you get the person's name and keep a record of what you talked about and any agreement you may have reached. Also, ask to have a copy of the agreement sent to you in writing. Creditors will usually do this anyway, but ask for it just to be sure and hang on to that email or letter when it arrives. By the way, scam artists will use tough times like a recession to victimize folks who are already in dire financial circumstances. So don't respond to emails or give out information to anyone who calls you claiming to represent one of your creditors. Step five, get professional nonprofit help for managing credit card debt. Contact our friends at christiancreditcounselors.org if you are starting to fall behind in payments or expect you're about to. They have arrangements with many creditors to lower your interest rates. You'll make one payment that covers several creditors, making things much simpler. It's not debt consolidation, it's debt management, and that can help you pay off your creditors 80% faster. You can make arrangements to speak with a counselor at christiancreditcounselors.org. If you are laid off and lose your health insurance, check out Christian Healthcare Ministries. They offer a medical cost-sharing alternative to health insurance, almost always at a much lower cost.

You can find out how they do it at chministries.org. Now step six is to save as much as possible. It's four times like a recession that we always tell you to have three to six months living expenses in your emergency fund. There's no better way to recession proof your finances, so start saving today. And finally, step seven, pray. Pray that God will provide wisdom for managing your finances in difficult times.

James 1-5 assures us, if any of you lacks wisdom, let him ask God who gives generously to all without reproach and it will be given to him. So those are your steps to recession proof your finances and we'll put links to all the resources I mentioned in today's show notes. Your calls are next. Stay with us.

So thankful to have you with us today on Faith and Finance Live. I'm Rob West, your host. All right, our calls, well, your calls are ready to be taken by our team. Lines are open at 800-525-7000. That's 800-525-7000. We've got several lines open for whatever you're thinking about today financially.

We'd love to tackle it. Our promise to you is to be encouraging and hopeful to help you apply the wisdom from God's Word, the principles and practical ideas to whatever you're thinking about today in your financial life. Again, 800-525-7000 with your questions and or a testimony today. If you'd like to share a story of how God has been faithful in your financial life as you've applied these principles, we'd love to hear it.

Again, 800-525-7000. We started today by talking about recession readiness and certainly we need to be financially ready for recession so that we're prepared with a strong financial foundation. That's really key. We need to dump debt. We need to limit spending.

We need to have a spending plan, have some margin built in, thinking long term and continuing to give generously all along the way. But our perspective is really critical as well. We have to begin with the idea that our identity is rooted in Christ, not our things.

It's not about what you do or what you have. Our identity is in Christ, our hope of glory. And when we have that right perspective, well, it changes everything because perspective determines our behaviors. Our perspective is gained and maintained by spending time daily with the Lord in His Word so that we're renewing our minds. And then as we approach our finances from that biblical worldview, well, it changes everything about how money now is a tool not only to accomplish God's purposes and provide for ourselves and our families. It's also a tool to grow our faith. It's a daily demonstration of where we've placed our trust. It's also a testimony to the world as we live out our faith through our finances. It's an example, especially in uncertain times, of how we're trusting the Lord and still being generous, helping those on our path, even in the midst of the uncertainty. So it's just as important, I would say perhaps even more important, to deal with our worldview and our perspective at the same time we're dealing with our financial house. And as we focus on the eternal, the things that will last, well, it puts the temporal in its proper role and allows us to focus on really that which is most important.

Hopefully that will help you as you think about where you head from here and really the importance of spending time daily with the Lord, especially as it relates to this area of financial management. In just a moment, we're going to be headed to the phones. Plus a little later on the broadcast today, Bob Dahl will stop by. He joins us each Monday with his insightful analysis on the markets and the economy.

He'll certainly do that today as well. We'll be asking about the most recent decision on the part of OPEC to cut production, which is signaling higher oil prices and gas prices in the days ahead. We'll get Bob's take on how that's going to affect our economy, which is already in a bit of a tenuous situation.

Hopefully that's one more piece of the pie that we're going to have to deal with as we look out. We'll get Bob's take on all of that a little later in the broadcast. All right, let's begin today by diving into your calls. We've got a few lines open.

Eight hundred five two five seven thousand to Washington. Hi, Linda. What can I do for you? Hi, Rob. Thanks so much for taking my call. Sure.

I hear I'm kind of twofold. So you hear a lot of things about the economy crashing and what we're going to go into and what will that look like? Will our money be totally worthless?

What does that look like? And, you know, should I take some money out of my savings and pay down my mortgage right now? Might that be a better place to have my money? Yeah.

Yeah. Well, a couple of thoughts on that, Linda. I mean, certainly we've heard doom and gloom type scenarios for a long, long time. I think the Christian community has been particularly susceptible to this. I mean, you know, we talk a lot about the late Larry Burkett, incredible impact he's had on millions. And to this day, we hear from folks every week that are talking about Larry's ministry. Well, Larry wrote a book in the 70s called The Coming Economic Earthquake, and we really never saw that play out.

Now, I think Larry was early in that call. And a lot of the things he's talked about are even more of a concern today, even though we've never seen any kind of economic collapse. And the economists and God fearing folks that I trust don't see anything like that on the horizon. Certainly, we could see something like a debt crisis, you know, down the road. But I think that's beyond the near term. You know, the question you have to ask is, you know, what is possible in terms of a complete collapse of the economy?

I just don't see that. I mean, could we get into a period where we have high inflation and like we have now, but where it's sustained for a period of time with slower growth because of slow growth policies that results in higher unemployment? You know, yes, absolutely, we could. And that's one of the reasons why we need to get back to a biblical view of economics that puts value on human life and understands God's design for economies and wealth creation, that human beings are a blessing, not a curse. We were created to be productive, to take God's creation and to order it and improve it. And that activity becomes economic expansion that creates wealth that's then reinvested.

And that's a virtuous cycle. And as a part of that, we give back to the God that created us and that generosity and economic expansion is really God's design. And that keeps interest rates low as a reflection of the lack of risk in the system. And then we get that wrong by taking God out of his rightful place and putting government in that place. And then we suppress interest rates like we have. And now we're relying on the Federal Reserve and in ways that we shouldn't. And all of that is problematic. And it's one of the reasons why we need to be voting for people that are in Washington who understand God's design and understand the principles that led to the United States taking off like a rocket ship over nations that were, you know, centuries older than we were. And, you know, could that result as we violated some of these principles in economic turmoil?

Well, certainly. But I don't think there's anything on the horizon that would cause us to say we need to live in fear. And I think we ever need to live in fear.

We we place our trust in God. But should we be pulling money out of the banks and burying it in the backyard? And, you know, should we be stockpiling gold?

No, I don't think any of that needs to happen. In fact, I think based on everything we know today, we still need to be long term investors. The very best way for us to overcome the effects of inflation is to have a properly diversified stock and bond portfolio where we're a partial owner in a company with real sales and earnings. We still today, despite our challenges, live in the strongest nation, economically speaking, in the world. That's a good thing.

Despite some of the things that are going on geopolitically that are reducing the dominance of the dollar, it is still the de facto by by far reaches the world's reserve currency. And we're still innovating and driving world economic activity forward. So I think in light of that, we get our thinking right, placing our trust in God and realizing our dependence is in him, not the things of this world. We follow his principles with regard to how we manage his money, minimizing the use of debt, setting long term goals, giving generously, having some margin in our financial life, living within our means. If we do all of those things, I think we put ourselves in a position to experience God's best. And when we've done that, then we've done everything we can do as a faithful steward. So I hope that's an encouragement to you as both the practical advice on where we go from here, as well as how we think about it from the long term.

You stay on the line. We'll talk about the second half of your question just around the corner. And I'd love to get your thoughts on that as well. This is Faith and Finance Live. We'll be right back with much more. Stay with us. Delighted to have you with us today on Faith and Finance Live. We've got a few lines open for your questions and testimonies today.

Eight hundred, five, two, five, seven thousand. Just before the break, we were talking to Linda in Washington, and Linda was asking about the possibility of an economic crash and what that might look like. Before we get to the second half of your question about your mortgage and paying that off with savings, I want to give you a chance just to react to my thoughts about that. About what you just talked about with our economy as a whole? Yes. I don't fear. I know that God's in control. And I, you know, I don't have a lavish lifestyle.

I don't have any debt other than a little bit on my mortgage that I am diligently paying off. So, yes, what you said makes perfect sense. And, you know, God's in control. And I know that. I trust that. And yeah, that's all I can do.

Yeah, that's exactly right. And it doesn't mean we bury our heads in the sand either. So I don't fault you for asking the question and we need to be trued as managers of God's resources. We need to keep our eyes fixed on the eternal, not the things of this world, but we need to be wise money managers while we're here.

And I think we're always balancing that. With regard to paying off your mortgage, I love the idea of you being out of debt. And if you said to me, Rob, I just really have a conviction from the Lord to be out of debt as soon as possible, I'd say, well, you know, then get that mortgage paid off as quick as you can. But I would, apart from that, I would say, you know, I also don't want you to deplete all of your reserve capital. So if you paying off your mortgage or paying it down rapidly would deplete all of your emergency savings, then I wouldn't be excited about that. Or if it were to take funds that really, you know, belong in your retirement savings so that you can grow a nest egg to turn into an income stream to supplement retirement. I'd like to try to balance that so you can keep enough growing for the future and enough working capital and emergency reserves. And if that meant in order to do that, you couldn't pay off the mortgage as quickly.

I would be okay with that. And perhaps a goal then is to have that mortgage paid off by the time you retire so that as you're entering that season of life, wherever God redirects you at that point, whether that's paid or unpaid work, you're reducing your lifestyle as low as you can because your biggest expense is now out of the budget, your mortgage. But if you said, No, Rob, I've got three to six months expenses separate from this, and I feel like I'm on track with my retirement savings, having enough that's growing for the future, so that I've got what I need to supplement Social Security and I have a surplus beyond that, should I dump, you know, mortgage debt, I'd say absolutely, no matter the interest rate, let's try to accelerate that.

But if you don't have those two other pieces, and you'd have to pull from one of those, then I'd probably say apart from just a real conviction from the Lord to be out of debt as soon as possible, I'd probably, you know, delay that a bit. So you could focus on those other two things. Does that make sense? Yes, it does. Okay.

Can I just ask one more thing? When you made a comment, first part of my question regarding a debt crisis. So looking at that, would that be a debt crisis involving our country, our economy as a country, or collectively with all of the debt that we that people have? Yeah, well, it's, it's both when I was talking about would be where we default as a nation. So we would be unable to make our debt payments. And that could come, you know, this summer if we don't raise the debt ceiling, but that'll just kind of be a political football that they'll work through. But longer term, the debt levels that we're amassing in this country, we're not too far away from our biggest expenditure as a nation, in terms of our annual budget is going to be debt service interest on the debt. And if we were to get to the point where we had to, we defaulted on our debt, and other nations have done this, and we've kind of seen that play out, that would create a real problem where folks would lose confidence in the US and we would result in high inflation. And there'd be, you know, a whole host of ramifications of that. Let's hope it doesn't come to that our current levels are manageable. The problem is the trend is, you know, much higher in the future. And it's something Jerry Boyer and I have talked about extensively. And so that's something we need to monitor.

And, you know, further down the horizon, it could be problematic, even for a nation as big and as prosperous as ours is. And so that's something we'll have to keep an eye on. Linda, thank you for your call today. We appreciate you being on the program.

To Evanston, Illinois. Hi, Peggy. Go right ahead. Hi. How are you today? I'm great.

Thanks. Just a question. I am 63. I only have one debt that I just recently got because I did the basement over.

And I am a caregiver for my family members. And I'm just trying to make sure that if I take on another in reference to making sure I'm in track for everything, because I have a debt of 61,000. I just did the basement over and I don't have any other debt other than that. No car note, no mortgage. Okay, I don't have a savings but I have a 401.

Okay, so you've got a $61,000 mortgage for a home renovation project. You have a retirement account with about how much in it roughly? Probably about 500.

About 500,000? Yes. Okay. And what is your age?

If you don't mind me asking? 63. Okay. And how far just based on what you know, today, how far away is retirement? I would like to do it today, but I know probably three years. Okay. All right. Three years and you're still contributing to that retirement account?

Yes, I am. And the one time I was doing 30% after my parents passed away because I was a caregiver for them. But now I'm down to 20 because I want to pay off this loan because I haven't had debt for 10 years.

So okay, yeah, no, I understand how you want to get rid of that. And what about liquid savings? What do you have?

How many months worth of expenses? None of that, because I'm just trying to pay everything off currently. Okay. All right.

Yeah. I mean, I would say the next thing for you to do is do your retirement budget, which just basically says, what do I need to live on in retirement? Most folks live on 70 to 80% of their pre-retirement income because they're no longer saving for retirement. Maybe they've dropped their life insurance and not eating out as much.

I mean, things like that. So I would put together that budget and then look at what social security plus, you probably want to think about, you know, maybe $20,000 a year from that half a million, maybe $25,000 if it grows to $600,000 between now and then would be about the amount you'd want to be pulling. And if that $25,000 a year plus social security covers your retirement budget, then you're on track. If not, then that'll give you a goal of what you need to save beyond that.

But apart from that, it sounds like you're doing great. We'll be right back on Faith and Finance Live. Stay with us.

I'm so glad you're with us today on Faith and Finance Live. I'm Rob Lask. Coming up in our next segment, Bob Dahl stops by. We'll get his take on the news over the weekend of the cuts in oil production from OPEC. What does that mean for your summer driving season? We certainly don't need any additional expense in your budget, especially in light of sky high inflation.

That plus where the economy's at as Bob starts a new week. We'll get all of that and more just around the corner. All right. Back to the phones.

To Miami we go. Hi, Matt. Thanks for calling, sir. Go ahead. Hi, sir. Thank you for taking my call. So I was calling to see if you had any good ideas on how to knock my mortgage out.

I just started three years ago. The balance on it is $130,000. $128,000. And I'm trying to get it paid off earlier.

This is my last debt at the moment. So yeah, got it. And what is your age? 28. Wow. I love that. Well, congratulations.

It seems like you're doing a lot of things right. I love that as a 28 year old, you're already thinking about how you pay off your mortgage. That's excellent. And you got in before rates started up, which with that 3.25% interest, I still love the idea of you paying it off, but you've got a phenomenal rate in the meantime.

So that's really good. Let me ask, are you already contributing to a retirement plan? No, not a 401k. No, sir. Okay.

Do you have access to a company sponsored plan where you work? Well, yeah, I will here in maybe two months. Okay. All right.

Very good. And what about emergency savings? How many months worth of expenses do you have set aside in liquid savings? Well, probably six months at least. Okay. It depends on that.

But yeah, at least six months. Okay, great. And beyond the six months of emergency savings, what other assets do you have? Do you have any other investments or anything like that?

I have I have a nature of land in a nearby town. But okay, that's about excellent. Yeah, I like that a lot.

All right. So here's my thought. I mean, I think you've got all the emergency savings you need. So right now the priority should be number one, as soon as you're eligible, start contributing to that retirement plan. Because if you can start at age, you know, 2728, putting away 10 to 15% of your pay in tax deferred savings, ie a 401k, that'd be great.

You know, 30 years from now, you're gonna have a huge nest egg that you can use to supplement Social Security. Number two, I'd look at any other short or medium term savings goals that you have. So do you need to buy a car? Do you want to be able to do that with cash so you don't take on any, you know, consumer debt? Well, then you'd want to set up a separate savings account and start saving for that. Are you looking to buy a house and you need a down payment, then I'd be working on that.

Apart from those goals and starting your retirement, then I would say absolutely, let's start, you know, paying down that mortgage. One way to go would be to think about if you could put away or send toward principal reduction one extra payment a year. So you send 13 payments instead of 12. And maybe you send an extra half payment every six months. Just one extra payment a year will take a 30 year mortgage and cut it down to about 24 years. So you can shave six years off by just doing one extra payment a year. Perhaps that's a goal while you're getting some of these other things in place like starting to fund retirement savings, and saving for any other, you know, short or medium term savings goals. But apart from those, I love the idea of you paying down the mortgage. I just wouldn't focus on that before I would focus on, you know, your retirement savings or other savings that would eliminate the need for consumer debt.

Does that make sense? Yeah, yeah, for sure. Sure. You said one payment, one extra payment a year would be about six years, about six years. Okay. And so two extra payments a year wouldn't cut it down 12 years? Not necessarily.

You know what you should probably do, I would just go into whatever web browser you use, search for mortgage amortization calculator, or mortgage payoff calculator, you can put in your mortgage balance, your monthly payment, your interest rate, and then how much extra per month or per year you want to put in and just run the different calculations and figure out, you know, exactly with your mortgage and your interest rate and all of your terms, exactly, you know, how much a year you could send as a goal and what that would mean in terms of how quick you could pay it off. Okay. Gotcha, gotcha. So you, I know that's not related to the mortgage question, but you still think that investing in 401Ks is definitely a good idea. Oh, yeah, the storm that financial possible storm that's coming. I do because with a high inflation, and we could see continued high inflation, if some of these things happen that we're talking about, it's still the very best way for you to build wealth is to be an owner in real companies that have sales and earnings. And so you having a stock and bond portfolio, largely stock portfolio, still to this day with the US being the strongest economy in the world, and the one that's leading in innovation and in so many areas, that's going to be the best way for you to build wealth. That compounded growth is going to serve you really well, especially without the taxes being a drag on it. Apart from that, you're going to stick it in a savings account, and it's going to be losing purchasing power every month because of the effects of inflation. Now, if something down the road looks like it's going to be a real problem, like a debt crisis or something like that, you can obviously liquidate those holdings. But for the time being, that's going to be the very best place for you to position yourself for long term success as a steward being properly diversified with a sure and steady approach, not where you're trying to get rich quick, but where you're, you know, buying quality companies with a long time horizon. You know, that's going to be the very best place for you to build wealth. We appreciate your call, Matt, you're doing a great job.

Hey, let's head to Chicago to Angelo go right ahead. Hi, I have a credit card that was recently hacked in December. And I told they called me the same day it was hacked. And I told them that it wasn't me. And then I sent in some paper where I faxed them some information that I had to sign and say that I didn't do it. And they said, they sent me a letter that says my initial response conflicts with my recent response.

And that's not true. I called them back and told them I didn't do anything different. I that I never committed fraud. And they said I have to contact the merchant directly. But I don't really think I should have to because this I didn't have anything to do with it.

Yeah, I'm yeah, I'm a little confused by that as well. I mean, according to the fair credit billing act, if you've formally disputed this within 60 days to the card issuer, they then have 90 days to settle the matter after getting your letter, they would typically lock your card issue you a new one with a new number, and you should have zero liability. Although the law says you can only be held liable for $50.

Usually, they don't, you know, charge you anything. I think what you've got to get to the bottom of this question about the conflicting reports, and just determine what they're talking about, because it sounds like to me, you only gave them one explanation of the fact that this wasn't your charge. And you know, that shouldn't be between you and the merchant that should be between you and the card issuer, because you didn't charge this amount. And so that's a fraudulent purchase. So I would see if I can escalate this to somebody higher up in customer service or the fraud prevention department, and just find out exactly what they're talking about about these conflicting stories. Because I agree with you, you should be able to deal with this directly with the card issuer. It sounds like there's some sort of breakdown in communication there. Hey, Angela, let us know how that turns out.

But I'd go back to the card issuer to see if you can see this through. We'll be right back. Grateful to have you with us today on Faith and Finance Live. I'm Rob West.

We're taking your calls and questions today, but it's Monday. So in this portion of the broadcast, we're visited by our good friend Bob Doll. He's chief investment officer at Crossmark Global Investments, where he manages a number of mutual funds there. Plus, he also puts out each week his dolls deliberations, his market commentary.

You can sign up for it at Crossmark Global dot com. Bob, great to have you with us, sir. Thank you, sir. Hey, oil was the talk of the weekend. What do you make of all of that with the OPEC nations?

Yeah, pretty, pretty interesting, exciting and not expected. OPEC is planning to cut production over these next couple of months. And that obviously was great news for the oil sector. Those stocks were up 5 percent today and basically a flattish market, Rob. So some of the lost ground of the first quarter as the energy stocks corrected is coming back. Yeah, no doubt about it. And obviously the market weathering it fairly well, not in the tech sector, but at least on the big board, the Dow Jones up nearly one percent today. It's amazing how we continue to shrug off all of this news, isn't it?

It sure is. As you point out, it's sort of a yin yang market. One day the tech and other growth stocks do well, but the cyclicals like energy and financials don't. And then the next day, it's the opposite. And today was one of those opposite days. That is energy up 5 percent, financials up a bit.

But the technology sector was marginally lower. Bob, what about just the strength of the economy? We continue each week, of course, to get new data looking at the labor market, manufacturing service.

What are you seeing as you sit in your post today? Well, we're obviously into the second quarter. The first quarter, therefore, is in the history books. And once we get the GDP, the broadest measure of our economy for the first quarter, our guess is it's likely to be another reasonably good quarter. Probably will go in the history books as the strongest quarter of 2023 as things are showing signs of slowing down. And of course, the big strength, as you point out, has come from the labor market looking reasonably tight. But there's some signs that we're going to see some cracks there. Jobless claims, for example, last week moved up a bunch.

Yeah, interesting. Bob, you had a comment in your deliberations this week about monetary supply, M2. And you said there was a pretty significant point to be made in that we saw a decline. And this is the first in our lifetime. Is that something we should notice?

Yes, we should. Money makes the economy go. And it is very rare in developed markets to see money actually decline. Part of that is a function of the Fed trying to unwind its balance sheet. But money growth year over year is minus 2%.

That's very unusual. It is a bit concerning. We've got to watch it carefully. Now, fine tune it, the Fed has begun to partially reverse that in the wake of the banking crisis that they've provided more reserves. But nevertheless, we've got this decline year over year to digest, Rob.

Yeah. Bob, what about the dollar? Obviously, a lot of folks talking about the dollar still the de facto world reserve currency.

That's not going to change anytime soon, but we're starting to see chips in that. I saw a headline last week about Russia and China settling an LNG purchase in the yuan. And, you know, we're seeing Brazil settling some trades in local currency. I mean, is this the beginning of the end of the U.S. dollar or maybe not such a big deal?

I think it's going to be a long time unfolding. I mean, somebody has to replace the U.S. dollar. And while you've heard me say we've done nothing in the U.S. to earn the right to be the reserve currency of the world, and it is a massive blessing, there's no other currency that's strong enough, deep enough, broad enough. The euro, that's an experiment that many would argue has not succeeded. Japan, with its aging population, unlikely. And frankly, the Chinese currency, while improving in status, is still too weak, too narrow, and not traded enough to challenge the dollar. Now, might we see more baskets of currencies for selected trades? Yeah, I think that will happen. That had already been happening. It is getting more attention.

But I don't think many of us will live long enough to see the dollar not be the reserve currency of the world. All right. Yeah, interesting.

And makes a lot of sense. Bob, final question today. Your thoughts on the housing market just as we head into the spring buying season? Interest rates obviously ticking down slightly. Where do you think that's all headed? You know, so the downturn in interest rates of noticeable proportion has created some breeze in the housing market world, if you will, after that big increase in rates we saw over the prior 12 months.

So it's breathing some life into things. Look, we know activity levels in housing have dropped a bunch since a year ago. But prices in most locales have not dropped a lot. If we have a recession, probably more price declines to come. But for now, hold your breath and find a good place to live.

All right, sounds good. Hey, Bob, buy low and sell high, okay? Hey, you're a good man and have a great holy week in the meantime.

You too, my friend. Thanks for stopping by. That's Bob Dahl, Chief Investment Officer at Crossmark Global Investments.

You can learn more at crossmarkglobal.com. All right, to Cleveland. Hey, Mike, how can we help you, sir? Yes, thanks for having me on, Rob.

Love your show. Just had a quick question. So my wife and I, we were given an opportunity to buy my deceased grandmother's home. And, you know, we're kind of excited about the opportunity.

But it'd be a rent-to-own situation through my aunts and uncles who own the home. And we're just not sure if we should move forward with it. And we're not too familiar with the rent-to-own playbook.

So just wanted to give you your thoughts on it. Yeah, why not just buy it outright? Why the rent-to-own? Well, we don't have that much money in the bank. I mean, we've got maybe $13,000 saved.

The house, it'd be, well, for the rent-to-own, it'd be $160,000 over a 10-year period. And through crunching the numbers, it's essentially our rental payment at our unit right now. But yeah, just not sure. Yeah. Yeah.

Okay. So they would keep the ownership of it, you would be the renter. Would you be paying a premium over what this would normally run?

I mean, I realize this is family. So that may not be the case. And why I'm asking is, a lot of times, in a rent-to-own situation, you're paying higher than the normal market rates. Could be 10% to 15% higher in some cases.

Do you have a good read on that? It seems like it's going to be a good price. From what I understand, we know that the roof was recently done, and some other repairs were recently done within the kitchen. So it seems like it's at market value, or maybe even a little bit less. So it looks like maybe they'd be doing us an offer, or a good deal. But just not so sure about how ownership works under a rent-to-own, and if it's, you know... Well, normally, and this is a little different with it being a family situation, I advise against it. I mean, one of the major downsides is that you sign a lease that obligates you to buy the property at the end of the lease, no matter what. And if you can't afford to buy it, the legal requirement to buy it could land you in legal or financial hot water. So I would just make sure you really understand what you're getting into. There's also no guarantee that you'll ultimately qualify for a mortgage at the end of the lease agreement.

So you just have to understand that. And then if, you know, somebody were to get foreclosed on, so if the owner defaulted on the mortgage and the home is foreclosed on before you bought it, you could be forced to leave. And so there's just some potential problems. Every contract is different.

And so you've just got to look at, you know, what are you obligating yourself to? And there's usually a fee in there, usually 1% of the purchase price would be, you know, that fee to have this option. But if you, you know, have a real estate attorney look over the contract, again, given that this is a family situation, it could be a real blessing for you guys, because if this is the place, you know, you ultimately want to live and you have the ability to kind of, you know, rent at true market rates, and have that applied toward your purchase, which allows you to get into a property sooner than you would have otherwise been able to because you all haven't saved up enough, then, you know, this could be a real blessing for you.

I would just have, you know, a real estate attorney look over this for you. Okay. Yeah, that's great. I appreciate that.

Yeah, absolutely. And if you don't have someone you could, you know, contact a certified kingdom advisor in your area, or maybe contact your church and just ask for a godly real estate attorney just as somebody who can look over the contract for you help or draft it for you and the family members. Just so you guys have something in writing that's real clear about how things are going to be handled moving forward. Thanks for your call, Mike quickly to West Palm GG. I've got just about a minute and a half left.

Go ahead. Hi, I just wanted to find out how I could help my mother she had a 401k she had to move it to a self directed fund with her bank. And I'm not sure how to invest that for her to get the most out of her money.

She is 60 I'm still working, not too much debt, just kind of rent and car insurance, just minor things. So I'm not sure exactly what kind of stocks or funds to invest in it for her to get the most out of her money to kind of make sense. How much does she have in that 401k? There's two different ones. There's a traditional that has about a little over 5000.

And the rock has about 30 36,000 about 36. So about 41 or so between the two where I would go GG is our friends at sound mind investing.org sound mind investing.org through the sound mind investing newsletter that would give you all the information you need to pick some high quality mutual funds that are appropriate for her age at age 60 and her risk tolerance that allows you to see some growth over this but not have too much volatility. Just so you're not kind of left on your own to pick those investments. soundmindinvesting.org that'd be a great place to go. If you have further questions, don't hesitate to give us a call.

Faith in finance live is a partnership between moody radio and faith five so thankful for our team today Dan, Amy and Jim. Hope you have a great rest of your day and come back and join us tomorrow. I'll be here. We'll see you then. Bye bye.