I praise you for I am fearfully praying that your wishes can affect the way our kids manage in the lifetime of God honoring money management.
And don't we all want to do that? Matt, great to have you back with us. Rob, it's great to be with you. So Matt, we started this conversation last month in the program that aired on April 10th. We talked about teaching kids to earn, give, and save wisely, but there's much more in your book that of course we didn't get to. So I want to pick up the conversation today with temperaments, which you write a lot about.
Let's start there. How do temperaments affect the way we and our kids manage money? Temperament is a huge factor. It's probably the most underrated, underappreciated factor that influences how we manage money and then how our kids will end up managing money as well. So in essence, temperament is our nature.
It's our bent. It's kind of the way we come at life. And it goes a long way toward explaining all kinds of things from why some people have a hard time saving and others tend to save too much, why some people are willing to take a lot of risk in their investments and others really prefer to keep it kind of safe. And so it's such a big factor that identifying our temperament and understanding some of the tendencies, some of the strengths and weaknesses that are inherent in each of these temperaments is really essential if we're to learn to kind of play to our strengths and manage around some of the weaknesses.
Yeah, it's really powerful and I think a key idea for us to understand as we guide our children in this area. Now, Matt, you write about four of these temperaments and let's go through them. We might recognize these in ourselves and our kids. The first is sanguine. So tell us about that.
Sure. Yeah, the sanguine temperament is that sort of likable, outgoing, charming, life of the party sort of person. Financially, they tend to be naturally very generous, but they don't tend to like to use a budget. They'd rather be out doing things with friends than crunching some numbers. Tim LaHaye, the late Tim LaHaye, pastor and author, he wrote a lot about temperament.
He said he never met a sanguine accountant. Yes, that's important to understand. I think we're all quickly formulating in our minds the people, maybe ourselves, that fit into that category.
All right. The next on the list is choleric and not to be confused with colic, which has to do with our kids as well. What does that temperament look like?
Yeah, that's right. So the choleric temperament tends to be the person that's kind of the hard-charging type A sort of person. Financially, they tend to be really good at setting and accomplishing tough goals, but they can also put too much trust in money. They're kind of task-oriented, not so people-oriented, so they may have a tendency to run people over in their pursuit of their financial goals.
Yeah, that's helpful. And by the way, we're going to talk about how each of these should approach their money management. Let's move on. The next one is melancholy. And by the way, none of these terms sound very much fun, but what do we need to know about this one? Yeah, melancholy sounds sort of dour, right?
But that's the term for it. And so the person with the melancholy temperament tends to be very detail-oriented. They're even perfectionistic in some cases. These strange birds actually like to use a budget, and I can say it that way because melancholy is my primary temperament type. So while they're meticulous planners, really good at using budgets, they can also succumb to fear of making a bad decision, which can make them kind of slow to make decisions.
Yeah, that's helpful. And then finally, in just about 30 seconds before our first break, phlegmatic. What are the signs for that? The phlegmatics are those even-keeled, steady plotters in the world. They tend to be savers of money and stuff. You've got a closet full of stuff. You've got a bank account full of a lot of savings.
You might be phlegmatic. While they're very reliable, so really great steady workers, their saver mentality can make it hard for them to give. Excellent. Well, what do you do with that? How do you take these temperaments and then guide your children in a way that honors God as they manage money? What are some of the important lessons you need to know?
And what about habit formation, which is so key to wise money management? We're talking today with Matt Bell, the author of Trusted, preparing your kids for a lifetime of God-honoring money management. Much more to come just around the corner.
Then it's on to your calls at 800-525-7000. Stay with us. We'll be right back. It's great to have you with us today on Faith and Finance Live.
I'm Rob West. My guest today, Matt Bell, the managing editor at Soundmind Investing and author of several books on personal finance, including the one we're discussing today, his latest, Trusted, preparing your kids for a lifetime of God-honoring money management. Before the break, Matt was talking about our kids' temperaments. Yes, we all have them.
There's four that he named that are some of the most popular. And he was talking about how those temperaments shape so many things, but certainly that includes our money management. How does Matt, knowing the temperaments of our kids, help us to help them in managing money in a way that honors the Lord? Yeah, and so first of all, a temperament will start to emerge. We'll start to be able to identify a temperament in one of our kids at around age 12 or 13 is when we could actually have them take an assessment, which I've got in the book. And so parents can do this.
The kids can do this. You can talk about it and try to kind of sort out what is your primary and secondary temperament. But let's say you've got a kid who has a primary sanguine temperament.
That's the, if you remember, the outgoing kind of life of the party, extroverted sort of person. We could encourage them, perhaps as they start thinking about after school jobs, get one that involves working with others, not working alone. That'll really kind of fill their tank and motivate them to stay with that sort of work. And because they don't tend to take to the use of a detailed budget, we can encourage them to manage the money that they're earning by using the envelope system, a really big picture, very visual sort of system. Or you take a child that has a choleric temperament.
That's the hard charging type A sort. We can encourage them to hone their negotiating skills because they'll naturally be really good at that. So take them to garage sales.
That's a great place to practice. But as you recall, they tend to be more task oriented than people oriented. So we could also encourage them to be sort of mindful of how other people are responding to them, make sure they aren't running over people in pursuit of the best deal. And ultimately, you want both sides to feel good about a negotiation once it's over.
Oh, that's really helpful. And I think understanding these temperaments is so key. By the way, if you want to try to unpack your kids' temperaments, and then know specific ideas on how to guide them, this resource would be wonderful.
Pick up a copy of the book Trusted today. Matt, let's move on and talk about financial habits. You know, developing habits is so key to just being a functioning adult, but it's certainly key in this area of financial management. I know in the book, you talk about three components to habit formation.
I'd love for you to unpack those for us today. Yeah, that's right, Rob. So it's really essential if we want certain habits to stick with our kids. It's really important to see, to take the sort of comprehensive approach to cultivating those habits. And so I talk about heart, head, and hands. Heart is worldview. That's our love for Christ, our identity as stewards of God's resources. You know, the Bible says, Guard your heart, for it is the wellspring of life. So much of our behavior flows out of our hearts. So heart is the first element.
Head is the second. That's knowledge. So that's knowledge of God's Word. So we teach our kids, you know, verses like, In the house of the wise are stores of choice food and oil, but a foolish person devours all that they have. And then knowledge is also, Well, how do I put that into practice in a really practical way? So we teach them about the options such as an online bank to keep their savings.
And then hands is, it has to do with doing real things with real money, preferably their money in the real world. And it's really important to use all three because they all build on each other. They all reinforce each other. You can't just get two of them without the third if we want to cultivate habits within our kids that are really going to stay with them. Matt, how have you seen this work itself out with your own kids as you really teach these ideas of habit formation? Yeah, it's been a really fun process of discovery.
I almost feel apologetic. I've had to use our kids as sort of a living laboratory, but hopefully haven't done too much damage. But it's little things. It's like, okay, we teach, you know, a diligent work ethic. We teach them how to mow the lawn. We teach them how to care for the lawnmower. We teach them some of the doing things related to the work that they do around the house.
We want them to do it with excellence, without complaint. But we also want to tie it to the bigger picture, to their faith, to what God's word teaches us that whatever we do, do all things with excellence as working for the Lord, not for human masters. And so we want them to take that motivation from God's word. So we're teaching them, they're actually doing it and getting that hands on experience. And we're cultivating that, hey, this all comes not from mom and dad, but this comes really from God's word. That's such a big idea.
That's great. Matt, you write about the most important money lesson of all in your book. I'd love for you to share that with our listeners today.
Sure. It's living with an awareness, Rob, that this is not our home and that even the greatest experiences in this world will never fully satisfy us. Now, that may sound like bad news. It's not bad news.
It's helpful news. Because when we see the things of this world from that perspective, it really frees us to stop looking to them for things that they are not capable of delivering, such as meaning and satisfaction. And it enables us to see them for what they really are. They're wonderful, beautiful gifts from God who loves us and sees us as His children. And in some cases, you could even really see this as little glimpses of heaven as we experience some of the greatest experiences of this world. But they're not the basis of our identity, our self-worth, our ultimate joy. And so if we can teach that perspective in our kids, what a benefit that will be for their whole lives. You know, I love how one of my favorite authors, John Eldridge, summed all this up. He said, The key is to deeply enjoy what there is now to enjoy as we wait with eager anticipation for the true feast that is yet to come. If our kids can gain that perspective, that will serve them well for their entire lives.
Well, there's no doubt it will. This is, of course, a real challenge, Matt. I mean, they're constantly being bombarded with pursuit of the temporal. I mean, social media is right in their face every day with the best version of people's lives.
They're getting caught up in the comparison trap. They're finding their identity in things. How do we counteract that and cultivate this eternal perspective with this barrage that's coming at them culturally? Yeah, there are a few keys to that.
You're right. That's a huge challenge and never more so than today because of factors like you're mentioning, such as social media. And so we need to help them understand the truth of who they are.
If they've placed their faith in Christ, they are children of God. They're not the brands of clothing they wear or the type of car they'll drive one day. And so we need to cultivate and help them meditate and kind of write the truth of God's word on their hearts so that the messages of this world don't have so much space to get into those hearts. And then I think another really huge factor is gratitude. You know, the culture in so many ways fosters a sense of discontentedness so that it encourages us to buy more. It tells us we don't have enough and that we are not enough and that our kids don't have enough and that our kids are not enough. And yet if we can practice that habit of gratitude, of giving thanks for all the many blessings in life, that is one of the strongest anecdotes to the messages of our consumer culture. You're exactly right, Matt.
Just a few seconds left. Obviously, generosity breaks the grip of money over our lives. So how do we cultivate that gift of giving? Yeah, I think, you know, again, it goes back to teachings. We're teaching God's word that part of this is obedience, but part of it is that we are designed in God's image and God is infinitely generous.
And so to live generously is to live in concert with our design. We're teaching that to our kids. We're encouraging them to give towards certain God-honoring causes, to give to our church and other ministries that God puts on our heart. And we're helping kids kind of map it onto something real. I love to help kids make the connection of the real impact that their generosity dollars are having, whether that's writing to exchanging letters with the child that we support halfway around the world, or it's seeing the impact that our own church is having in our local community.
Oh, that's powerful. Matt, unfortunately, that's all we have time for today, but you've really helped us think about how we can equip our kids to be wise stewards of God's money. Thanks for stopping by. It's my pleasure, Rob. That's Matt Bao, Managing Editor at Sound Mind Investing. His book is Trusted, Preparing Your Kids for a Lifetime of God-Honoring Money Management. We've got to take a quick break, but much more to come just around the corner.
Call right now, 800-525-7000. We'll be right back on Faith and Finance Live. Well, thanks for joining us today on Faith and Finance Live. I'm Rob West.
Always great to have Matt Bao with us today. And boy, what an important topic as we prepare future adults, our kids, to be God-honoring stewards of his resources. You see, it's not about just financial literacy. Yes, they need to know how to balance a checkbook. If anyone uses a checkbook anymore, they need to know the danger of debt and compound interest working against you.
The power of compound savings and investing working for you. The value of hard work, why it's important to give generously, but they also need a biblical worldview. You see, they need to understand the Council of Scripture as it relates to how we view and manage money, starting with God owns it all and that we're stewards or managers of God's resources. That the world will lead us toward greed and materialism, but we can counteract that through generosity because we were hardwired in the image of God, the ultimate giver. And when we lean into that understanding and seek first the kingdom, the eternal, not the temporal, the here and now, well, we put ourselves in a position to experience God's best because he's placed in his rightful place and first position in our lives and money becomes a tool to accomplish his purposes. If we can communicate that to our kids philosophically, but even more importantly, practically, boy, we've really set them up for a lifetime of experiencing God's best in this area doesn't mean they'll be without challenges. They will have them. We all do. They may even find at some point themselves in a desperate financial situation, but they'll trust God as their provider, knowing that his promises are true and that if we handle our own economies according to God's wisdom and principles.
Well, we've set ourselves up to experience, I believe, the joy and the peace of mind and the satisfaction that he intended for all of us. We want to help you do that on this program today, and that's why we've got some lines open to take your calls and questions on anything financial. Eight hundred, five, two, five, seven thousand is the number to call.
Again, eight hundred, five, two, five, seven thousand. Gabby T. standing by to receive your call today. She's looking forward to hearing from you. All right. I'm ready to dive in. If you are, let's go to St. Louis. And Ann, you'll be our first caller.
Go ahead. Hey, Rob, thanks for taking my call. My husband and I are looking to do some kind of educational account for our grandchildren. We have four.
The youngest are two and the oldest is about 10. And so we we have a financial adviser, but he wasn't real familiar with educational stuff. And so I thought, well, I might just call Rob and see, you know, what he says is a good option for us maybe to look into. Well, I'm glad you did, Ann. And I'm glad you're thinking about this. What a blessing it will be to your grandkids and their parents as they near college as a dad of a high school graduate.
As of this past Tuesday, he's graduated from high school. I know the importance and the cost of college that you can help to offset here. You know, my favorite tool is what's called a 529 education savings plan.
There's a couple of flavors of the 529. There's the prepaid college, which not all states have. But then there's the 529 education savings, which all states do have. I think it's your best option. You can choose from any state.
You don't have to go to yours and you can use it at any school in any state. So there is great flexibility and you should look for the one that has the features you like best. In fact, the best Web site to help you evaluate and select the 529 for you, considering their prior investment performance returns, as well as any tax benefits you may have coming. State tax benefits is saving for college dot com saving for college dot com. You'll actually run through a series of questions and it will recommend the top three 529 plans for you.
They're even more attractive now because of some recent legislation. And that is going to allow you to put up to thirty five thousand dollars of this money or for it to be rolled into the recipients. Your grandchild's a Roth IRA after 15 years if it's not used for education expenses. So one of the downsides of these plans, you could always get the money out for scholarships or grants on a pro rata basis.
So that's not a concern. But if they didn't go to college, maybe they decide to go directly into the workforce or something else. Now there's going to be an option down the road once the money's been in there 15 years, or at least it's been open for 15 years for you to roll it into a Roth IRA so they could convert it to a retirement account.
But you can contribute to it. It does not penalize them from a financial aid eligibility standpoint. If there's a chance that their parents would qualify for need based aid, very flexible. You get tax free growth on the money as long as it's used for qualified educational expenses. And you can basically put in an unlimited amount of money so you could set it up yourself with the child as the, of course, the recipient.
You would be the owner or their parents and then you would contribute to it and you could do that monthly if you wanted to or as a lump sum. So I think that's going to be your best resource. How does that sound, though?
That sounds great. And you had answered my second question because I wanted to make sure and ask if they weren't going to use it for educational purposes. Could it be used for something else? Because I didn't want to put that money in and then them not be able to use it if they needed it. But that's good. That's right. So your options there would be to transfer it to another grandchild or to go ahead and roll it out to this Roth IRA, subject to the limits. They'd have to only convert it up to the annual limit each year. But they could, you know, if there was another grandchild that needed it, you could just move it over or they could get it into that Roth IRA.
So some great options that don't involve penalties and taxes if the money is not needed for qualified educational expenses. So, Anne, I hope that helps you. We appreciate you calling and listening. And thanks for being a part of the program today. We're grateful. Eight hundred, five, two, five, seven thousand is the number to call as we head into a holiday weekend. Perhaps there's something you've been wrestling with, thinking about in your financial life. We'd love to help you tackle it. Before we head to the break and then back with more calls, a quick email from J.A. J.A.
writes, I'm an avid listener to your program. I've had a Roth IRA for almost 10 years. Is there a way to roll it to fund a new SEP IRA? And bottom line, J.A., is there is no minimum required income to qualify for a Roth. Unfortunately, a Roth, though, or any retirement account that's funded with after tax money cannot be rolled into a SEP IRA. Any pre-tax retirement account can be rolled into a SEP IRA, but a Roth is after tax money.
So that would not be able to be rolled over. So we appreciate you checking with us. If you have a question you'd like read on the air, you can send it along.
Ask Rob at faithfi.com. Hey, much more to come just around the corner. Stay with us. We'll be right back. So thankful to have you with us today on Faith and Finance Live. We've got some lines open. We're ready for your calls and questions on anything financial. Eight hundred five two five seven thousand. That's eight hundred five two five seven thousand. Hey, Ann called just a moment ago.
She was not able to hold, but she was wondering two things. Number one, is an annuity a good option for retirement savings? They're not my preferred option. And unless you have no tolerance for risk at all, you're better off saving in a retirement plan. So a tax advantage retirement plan at work, if you have one like a 401K, you could certainly use an IRA. There are other tax advantage options if you're self-employed.
But that would be my preferred option. You get 100 percent of the upside on the growth. Yes, you have the risk of the downside, but the if you have a long time horizon, a properly diversified stock and bond portfolio without the complexity and cost of an annuity and the cap on the returns is going to allow you to experience the very best opportunity for growth in your capital. With regard to your second question, which was how much do I need for retirement? You know, a general rule of thumb, and that's all it is, it doesn't replace really thoughtful retirement planning with an advisor. But a good rule of thumb is a starting point is 10 to 12 times your income.
Now, why is that? Well, let's just run the math really quick. Let's say you make sixty thousand dollars a year. Twelve times your income would be seven hundred and twenty thousand. Now, you might stop right there and say, Rob, there's no way. That's fine. We just need to right size our living expenses to match our income.
But let's play this out. So you're making sixty thousand a year. You need 12 times your income saved.
That's seven hundred and twenty thousand. Well, that's going to throw off at four percent a year, which should be able to be pulled out without you impacting the principal. So you won't ever drain that to zero.
It'll stay at 720, give or take over the years. And you can pull out in this case twenty nine thousand a year. Now, twenty nine thousand is not 60.
How do you get there? Well, normally you would live on typically you would live on 80 percent of your pre-retirement income, just on average. So on sixty thousand a year, that's forty eight thousand a year that you're living on. We're still not there yet because we're only pulling thirty thousand roughly from the investments that we built up in the retirement plan. Well, the balance is made up by Social Security. So typically you would expect up to 40 percent of your pre-retirement income to be covered by Social Security. So the combination of that income stream from the savings of seven hundred and twenty thousand, twelve times your income, plus Social Security, living on 80 percent of your pre-retirement income should give you what you need. Now, again, you may need to right size those expectations. You may not be able to live off of just the income. Maybe you are slowly pulling the principal down. Maybe you have other income sources like a pension. I mean, all of that needs to be factored in, but that's at least some rough rules of thumb to think about as you plan and prepare.
At the end of the day, you've got to decide what is our lifestyle going to look like and how do we match that with the various income sources that we have? All right. Let's head back to the phones to Florida. We go. Hi, Melissa. Go right ahead. Hi, how are you? I'm doing great.
Thanks for calling. My question is, I've just finished with sadly with a divorce and I was left leaving our business that we had together to him and taking other assets like property, the home, the marital home. And there's still a mortgage on it and it's still significant.
So I'm trying to decide if I should sell the house and take the equity plus some of the cash settlement I received and buy a smaller place because I don't need four bedrooms and two and a half bathrooms for one person and and and get something small that's paid for. And I don't have a mortgage anymore. I'm 55 years old and I don't have a lot in retirement.
I have a small IRA and some investments, but not a lot. OK. Yeah. Well, first of all, I'm so sorry to hear about what's going on there, but I think you're right in thinking through this. I mean, typically we would say when you experience a major life change, go slow. It's best not to make any big decisions for a year or so when that happens, although I realize there's just the reality of balancing the budget.
And you may know quicker than that kind of where you want to go, what you might want to buy and what location, how much you need, you know, and all of that. I would concur. You probably want to take this opportunity to pull the money out of this home. You know, we're still very high in terms of the housing market, even though the market is softened and it's now more favorable for buyers because of the higher interest rates in the looming recession. We really haven't lost much in the way of home values. They really haven't come down.
They've just stopped growing as quickly. So you could get essentially top dollar out and then you could either rent for a while and just pray and think through kind of what this next season looks like and where you want to go. Or you could turn around and buy something. But I like the idea of you downsizing something that's more manageable, perhaps being debt free, and then take any of the remaining proceeds and shore up your emergency fund and get it invested for the future.
So, you know, that seems to make some sense to me. But what other considerations are playing into this as you think about this decision? Well, I thought maybe, you know, should I just take in a roommate and is it better? Are prices now topped out and it's not going to go any higher? So, you know, and taking in a roommate, I don't know. It's just a lot to think about.
Sure. I mean, I think one of the rules of thumb with especially with housing is not to try to time the market. I mean, the bottom line is this is a great time to sell if you're going to sell because, again, housing prices are still very high. I think they will soften somewhat as we head into this recession. Rates are still high, but real estate is going to be a great long term investment, just like stocks and bonds. We go through these periods, depending on what's going on economically, where, you know, it's either a buyer or seller's market.
And, you know, over the last decade, we've seen a huge run. I mean, just check Zillow dot com. You can see what your house has done, you know, in terms of appreciation. So that's a good thing, but you're also going to still pay top dollar. And, you know, if you're getting a mortgage, you're going to have, you know, high mortgage interest rates.
Hopefully you're not. You're able to buy it with cash. That'd be great. And then that's just going to keep your lifestyle expenses low. So I think bottom line is you need to decide what is the right move for me? Do I want to stay here and take in a roommate? Would I prefer to move? And if you would, I'd go ahead and do it, even though I agree this is a good time to do it.
Even if it wasn't, I would say don't try to time the market or the housing market, you know, hoping you can do better or worse six or nine months from now. I would say you make the right decision for you after a lot of prayer and consideration and then go for it. Thank you. Thank you.
All right. Hey, we'll be praying for you, Melissa. We appreciate your call today. Thanks for being on the program to Wes in Fort Lauderdale, my hometown. How are you, sir? Go right ahead.
Hey, Rod. Thanks for taking my call. Sure. I was calling about my mother-in-law because she has a house that's been put into an irrevocable trust.
And they did that or they set that up because for her to receive veteran benefits from her husband who passed away. Okay. Because this helps to free some of the costs of her assisted living facility.
Okay. Well, now we're trying to figure out what to do with this home because it just sits vacant. And the accountant that handles the trust return says that it cannot be rented or she would lose veteran benefits. Yeah. So her children are trying to – they're considering selling it and one of the kids is interested in buying it. We're not sure about how to go about doing that or what kind of professional would be best to contact regarding giving advice on that. Yeah.
I would talk to – it's going to really be a combination of an estate attorney plus your CPA because there's tax implications but there are also legal implications with regard to the irrevocable trust. And then I think beyond that it's really just the financial plan. So having a good financial advisor at the center of this and then orchestrating those other professionals I think is really key to you all working through this. Stay on the line. We'll talk a little bit more off the air. We'll be right back. Well, it's great to have you with us today on Faith and Finance Live. I'm Rob West here in our final segment today before we head back to the phones. We're joined each Friday as we round out the week by our good friend Jerry Boyer. He gives us his insightful analysis on the markets, the economy, corporate engagement, whatever he happens to be thinking about. And Jerry, here as we finish out a week, I think it looks like the market is rallying on hopes that the debt ceiling negotiators are perhaps making some progress.
What say you on all of this? Yeah, I think that's exactly what's happening. Now, they're generally down for the week but it kind of reverses and that's why I can't prepare for this interview Friday morning because I don't know what's going to happen Friday late morning or early afternoon or whatever is going to happen because the story changes so much. So basically the story was largely this week a story of, oh, well, maybe the Fed's going to start hiking again because the Fed minutes came out and markets had basically convinced themselves that the Fed's done hiking and the Fed minutes came out. The notes from the meeting, which you don't get until a couple of weeks after the meeting, in which they were really – they're really divided.
They don't know what they're going to do. So the market said, well, okay, so it really is kind of a 50-50. Maybe they're going to hike rates and that kind of drove markets down and inflation today was a little higher than expected and so I guess the Fed's going to have to raise rates.
But then the debt ceiling situation seems – there seems to be a deal in the works and so that's made markets a little more optimistic. And so one of the things I've said to you over and over again is the biggest mover in markets is the Fed because it's the biggest single investor. But there are things bigger than the Fed and that's why sometimes markets will move based on the possibility of a banking crisis or the possibility of something as big as a debt crisis or a U.S. debt default. Because if we defaulted on our debt, that's just too big a problem for the Fed to handle. The Fed cannot solve that one.
So basically when you have that big a threat on the table, then the markets are going to pay more attention to that than they are to the central bank, which is what they're usually paying the most attention to. Yeah, very good. Jerry, you're breaking up just a little bit. We caught everything you said, but hopefully we can get that line a little stronger.
But that was really helpful. Jerry, I know you've been working a lot on some corporate engagement activities as of late. Your team, every time I talk to you, you've got them scattered across some various meetings that are taking place. Oh, it looks like we lost Jerry, so we're going to try to get him back on the line. But we're going to get his update on what's happening with regard to corporate engagement as he participates in so many of these meetings.
Jerry, I think we have you back with us. And what I was saying was I know your team's been participating in tons of meetings. There's a few key kind of hot button issues we've been hearing about in the press.
So give us an update. Well, you know, every week we're going to a lot of meetings, PayPal, Amazon, BlackRock or this week, for example, Merck, et cetera. But I think the one that's top of mind for me right now is a company that we don't have the meeting until next month, but that I've been talking to on and off for about two and a half years. And that is Target Corporation. Target Corporation, I think, took a wrong turn really 12 or 13 years ago. And it's shown it in various ways, you know, by kicking the Salvation Army off the property and by banning some books.
And that's when I started to engage with them and, you know, the bathroom debacles. And now, you know, a pretty bad decision in terms of branding. We're really pushing hard on some things that are very offensive to a lot of the customers. And I can tell you that last year I had some meetings with executives last January, as a matter of fact, about some of this book banning and about some of these decisions that seem to be governed more by politics than by business. And their answer was basically, listen, you know, we're really not worried. The company is doing well.
The stock's doing well. When we engage in politics, it's relevant to the business. And they mentioned sales taxes, lobbying and property taxes.
And I said, you know what? You know, we're not concerned about you lobbying on sales taxes and the rest of it. We're talking about lobbying on issues that are divisive social issues, weakening religious freedom, et cetera, pandering to various identity groups.
This is the kind of thing we're talking about. And they said, we're just not hearing that much about it. And I suggested to them that they are going to, that they're really playing chicken with the brand and that the big risk for them is not upsetting the people who in the past have boycotted them. The big risk for them is boycotting the silent majority of target customers who reach a point where they've had enough.
And I said, once that happens, you're going to have trouble putting it into reverse. And basically they brushed off that concern. I worked with an investor to try to put a proposal on the ballot. They fought that in front of the SEC and they won on some technical issues or some paperwork issues. They basically said it's ordinary business. Management knows what it's doing. We don't need shareholder input on this. Well, they did. They did need shareholder input and they did not heed the warning.
And I don't know if the brand is busted at this point. It comes a point where for the broad American kind of middle class, we don't pay attention to this stuff. But when we wake up, we don't forget easily. And I'm not sure that Target can win back a lot of the customers that it's offended. So this is something where you could argue that this is engagement that failed. But I don't think there ever is engagement that failed to warn somebody of something coming is your duty. And if you don't warn them and something bad happens, as God told Ezekiel, it's on you. But if you do warn them and something bad happens, then it's on them. Target has made some bad decisions, but they were fairly warned about the direction they were going and they just decided to double and triple down on that.
Well, obviously it's getting a lot of attention now. I know, as you said, that the shareholder meeting is forthcoming, so we'll continue to check in with you. I know you're providing just an interesting perspective in this, given the conversations you've had for a long time with this particular corporation about a wide range of issues that are important to those who want their values reflected and want these companies to stay focused on their primary business and not their political ambitions. Jerry, we had a caller earlier in the week and I told them I would ask you about this and I'm just catching you off guard with this, but they were asking about a set of proposed economic reforms that were put forward by a private citizen, Harvey Francis Barnard. It was called the National Economic Security and Recovery Act back in the 90s, and it basically consisted of replacing the income tax with a national sales tax, abolishing compound interest on secure loans, returning to a bimetallic currency, and all of that would result in a more stable economy and inflation. I'm curious if you know about this particular proposal, and if not, just what are your general thoughts about some of those perhaps major changes and could they be more effective than our current system at promoting a more stable economy and dealing with our inflation?
I'm familiar with some of the ideas. Bimetalism is something that the Constitution permits. I would say it is more defensible than our fiat money system, which is just the government sort of makes it up.
I would say a gold standard is historically more stable than a bimetal standard, because when you throw silver in, it becomes – bimetal is a gold and silver standard mixed, and it tends to be a little bit more inflationary. The Wizard of Oz, by the way, is about this story. I don't know if people know that, but it really was about the farmers in the Midwest, they didn't want deflation. They wanted inflation, and so somebody wanted to follow the yellow brick road, but that wasn't the right thing, and she has to put on her silver slippers. They made them ruby for the movie because they wanted to show off color.
She was supposed to put her on her silver slippers, and that would bring her home to Kansas. So bimetalism is slightly inflationary, but it's not as bad as what we have now. A national sales tax might have been a good idea, but the problem is now people who saved money, you earn money and you pay taxes on the income, and you save that, and then you retire, and then you spend it. So if you paid taxes when you made it as income, and then you have to pay taxes again when you spend it, then there's double taxation, and that's the problem with the national sales tax. If we had a national sales tax from the beginning, you wouldn't necessarily have that problem, but since we all have accumulated wealth, paying taxes already on income, then turning around and spending it again, then we're getting hit twice.
And also you'd have to have, while we're getting rid of the income tax, it's more like in Europe, they were told, hey, let's have a national sales tax, a VAT tax instead of the income, you know what they ended up with? Both. And I think that's the more likely outcome. So I've heard from these people a long time. It's almost like a cult-like following.
I'm pretty skeptical about it. Yeah, very good. And who knew that about the Wizard of Oz?
You've enlightened us today, my friend, by metallic currencies, the underlying theme of the Wizard of Oz. That's great. All right, Jerry, appreciate you, my friend. I hope you and the family enjoy your holiday weekend for Memorial Day.
And you and yours. All right, God bless you. That's Jerry Boyer, president of Boyer Research. He's our resident economist, joins us each Friday with his insights on the market and the economy. Quickly to Indianapolis. Steve, you've been very patient. I have just a little bit of time.
Go ahead. Yes, I recently sold some restricted stock units, and I know there's a capital gains tax owed on the gain. It's a long term, more than one year gain. Is that to be paid immediately or on an estimated tax schedule or when the next year's tax returns? It's always a good idea to pay capital gains taxes on the sale of stocks with a quarterly estimated payment just to avoid the potential for any penalties. And so you can kind of back into that calculation.
You know, as shares of restricted stock are sold beyond the vesting date, the gain then is taxed as a capital gain, as you pointed out here. And you know, I think it's always a good idea. It's out of the normal course of what you would be paying taxes on. And so it's an additional amount. So going ahead and getting ahead of that with your quarterly payments, I think is is certainly a good thing.
You can check with your CPA or tax preparer just to be sure and they can even help you calculate what you should be sending in. But I always think that's a good idea. Okay. Very good.
Thank you. All right, Steve, thanks for your call today. Well, folks, man, we've covered a lot of ground today from investments to retirement to, well, The Wizard of Oz with Jerry Boyer. Hey, we're thankful that you joined us today. I know it's a long weekend coming up, but we'll be back on Monday with a best of program for this broadcast and then back live on Tuesday. Look forward to having you with us.
Faith and Finance Live is a partnership between Moody Radio and Faith Buy. Thank you to Dan, Amy, Gabby T, and Jim. I couldn't do it without them. Glad you were along with us today as well. May God bless you and we'll see you next week. Bye bye. You
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