What to Expect If You Cosign

Ask any 10 people who have co-signed a loan, and almost half will tell you it was a bad financial decision. Hi, I'm Rob West.

When the Bible tells you not to do something, it's a good idea not to, and that's definitely the case with co-signing. But a lot of folks still do it, and I'll have some advice for them today. Then it's on to your calls at 800-525-7000.

That's 800-525-7000. This is Faith & Finance Live, biblical wisdom for your financial decisions. We get this question from time to time. I've co-signed on a car loan for my nephew, and he's not making the payments.

What can I do? Or variations on that theme. I think we'd hear from a lot more folks who've done this, but they're embarrassed about admitting to it. And it's sad, because the only reason someone would co-sign a loan is to help someone else. Far too often, it doesn't end well. At least one survey shows that if you co-sign, you have a 40% chance of having to pay the loan yourself, because the primary signer either can't or won't make the payments.

And if that's not bad enough, it's usually a family member or friend who will leave you holding the bag, damaging your relationship as well as your finances. Now, the best way to keep that from happening is to simply not do it. Remember the Ben Franklin quote, An ounce of prevention is worth a pound of cure? He was actually talking about fire safety at the time, but the concept certainly applies to co-signing today, which could burn down your finances.

The best way to get out of it is to never get into it. By the way, it seems Mr. Franklin actually borrowed that ounce of prevention idea from Proverbs 22, 30, which reads, The prudent see danger and take refuge, but the simple keep going and pay the penalty. And unlike Ben Franklin, the Bible actually does have a lot to say specifically about co-signing, and for good reason. Christians are often confused about co-signing. The Bible tells us to care for our family and neighbors, to help those who can't help themselves.

Wouldn't that include helping someone get a loan? The Bible says no and leaves no room for misinterpretation. It warns us over and over not to do it. Proverbs 11, 15 says not to pledge surety for another, meaning don't co-sign a loan for another who doesn't qualify on his own. And Proverbs 17, 18 reads, One who lacks sense gives a pledge and puts up security in the presence of his neighbor. Then in Proverbs 22, 26 and 27 we find, Be not one of those who gives pledges, who puts up security for debts. If you have nothing with which to pay, why should your bed be taken from under you? I mentioned that four in ten people who co-sign get stuck paying off the loan, but studies also show that nearly a third suffer damage to their credit, and a quarter say the experience damaged their relationship with the primary signer. Proverbs isn't one of the wisdom books for nothing. Okay, by now you're convinced never to co-sign, but what if you've already done it? What can you do about it?

Well, understand that none of these is perfect and they all have varying degrees of pain. The thing you have to remember is that as a co-signer, you're just as responsible for the loan as the primary signer. If that person can't or won't make the payments, there's no way you can walk away from it without severely damaging your credit. The loan must be satisfied.

So first, try refinancing. Your legal responsibility to repay the loan goes away if the other person refinances without you. If you or the other person has been making payments for some time, the outstanding balance should now be lower than the original amount that could allow the primary signer to qualify without you. Next, you can try speeding up the loan payments by offering an incentive to the primary signer. Offer to match any payments he or she makes. You may still end up paying half the loan, but that's better than the whole thing and it will keep the account in good standing. Now, if the loan was for an automobile and more than half of them are, you can ask the primary signer to sign the title over to you and you take possession. Then you'll have use of the vehicle while you're paying it off.

You can also sell it at some point and recoup part of your loss. Finally, you can try doing a credit makeover on the primary signer. Help them get on a budget. Teach them the importance of paying bills on time, saving, and being responsible. Eventually, they'll be able to refinance you out of the loan.

It's an approach that will have long-lasting beneficial results. Okay, so those are some of the things you can do if you co-signed on a loan and you're stuck making the payments. We hope you find them useful. All right, your calls are next. The number, 800-525-7000. By the way, you can call that 24-7. I'm Rob West and you're listening to Faith and Finance Live, biblical wisdom for your financial decisions.

Stick around. Thanks for joining us today on Faith and Finance Live. I'm Rob West. All right, it's time to take your calls and questions today on anything financial. The number to call is 800-525-7000.

That's 800-525-7000. We'd love to hear from you. Let's begin today in Tennessee. David, you'll be first on the program. Go ahead, sir.

Yes, Rob. Our church has got like $57,000 or $58,000 in our checking account, and it's drawing 0% interest. And we're thinking about putting half of it, taking half of it and putting it on, buy a CD with it, paying 5%. And we want to know, is there anything wrong with us doing that? Will we get in trouble with God or the government for doing that?

No, I don't think there's anything wrong with that, David. I love that you all are thinking about being good stewards of this money. I would tell you, and I'm not hearing this from you, so I will just say this for general purposes, I wouldn't invest this money.

I wouldn't take risk with the money given to the church to be used for ministry purposes. But I think maximizing the return prudently, and I would put a CD or a high-yield savings account in that category, a money market, let's say, for you to take your reserves, keep them liquid, establish a policy around how much reserves you want to keep. I think no amount is too little, more than a year is too much, but figuring out what that proper amount of reserves is and trying to maintain that is a good thing. And for that amount of reserves, protecting that but getting a decent interest rate on that makes a lot of sense. I would say the only downside to a CD is not around the safety, it's around the liquidity. So you just need to make sure you're thoughtful about how much you were to lock up in a CD so you don't have any penalties if you need to get out of it.

But the idea of you investing in something that has FDIC insurance as long as you're thoughtful about how much you put in, not going over those FDIC limits, then I would say that makes a lot of sense to me. Okay. Well, thanks a lot, Rob. All right, David. We appreciate your call today, my friend. God bless you. 800-525-7000 is the number to call. We've got some lines open today to Spokane. Hi, Dale, go ahead.

Hi, thank you for taking my call. I'm interested in a trust compared to saving probate. What do you think of a trust to save me from probate?

I like using a trust for that purpose if that really is your objective. So the benefit of operating outside of probate, as you probably know, is that it's not a part of the public record, so it's private. There aren't court costs, which you would have with probate, and it's more efficient.

The probate process can take time, even months, depending upon the complexity of the estate. So a trust is going to allow that to happen outside of probate. And one of the other benefits, in addition to what I've already mentioned, Dale, is that it can go into effect prior to your death. So if you were incapacitated and you wanted your successor trustee to make decisions on your behalf with your assets or personal items, that could be done. It could also allow your personal items and assets to be distributed beyond death based on certain triggering events.

Let's say you had minors or you wanted them to reach a certain age before they received part of their inheritance. That can all be done with a trust. So, yeah, there are a lot of benefits, one of which certainly is avoiding the probate process. What's the downside to the trust?

It just adds a little more complexity. You are going to have to retitle assets in the name of the trust. It's a little more cost, probably fifteen hundred to two thousand dollars would be a good general rule of thumb on establishing that trust. And then you'll still need a will because anything not in the name of the trust, you're going to want to make sure that you're determining where that goes and not the state. But apart from that, I like a trust for the reason you mentioned.

Yeah, yeah, I've heard all that just exactly what you said. Hey, one other thing, Rob, on your previous caller, Synchrony Bank has a four and a half percent interest rate, you know, money market. And Ally has about a four percent interest rate if somebody wants to not tie their money up in the CD.

Yeah, very good, Dale. I appreciate you mentioning that you can go to bankrate.com and that's a great source. In addition to going directly to the two you mentioned, which I would concur, those are very attractive rates. Bank rate's a great source because at any time you can search and sort by those banks, usually the online banks that are offering the best rates, both for CDs and high yield savings.

But those are two good ones. I will also mention, you know, a lot of folks these days want to do business with a bank or a credit union that aligns with their values as believers. And if that's the case, you may also want to check out Christian Community Credit Union. You can do that at joinchristiancommunity.com.

Again, that's joinchristiancommunity.com. Dale, thank you for your call today, sir. Call back anytime. Let's head to Ohio. Hi, Leon, go ahead. Hi, Rob.

Thanks for taking my call. So we have a question as it relates to our current home. My wife works from home.

She operated a successful business there. But recently we've lost the ability, because of our home space, to have two kids on the way to third. And so we can't operate most of what she does for her business out of our current house.

It's been a case for the last year or so. And as a result, we've lost a big part of our income. We're looking at a home now that's a lot more expensive, that would stretch significantly in terms of our finances. But the return to income would be would cover more than the difference. But it would take a little bit of time to restore it. And we're weighing that currently. Let's see what we should do about it.

Yeah, I appreciate that, Leon. I just want you to be careful there, because that's a pretty major commitment you're making and you're doing it on the expectation that the business will return. And the last thing I want you to do is to get overextended on a house and have that pressure on your marriage, not to mention financially, and it not materialize as quickly as you think. And that puts you in a real tough spot. Could even be as bad as losing your home, although it wouldn't likely come to that.

I mean, that's a possibility. So I guess prior to doing that, is there any way to restore the income first? I guess, you know, I don't know what kind of business it is, but if she's just looking for a private space, you know, would getting a place at a co-working spot, you know, get her out of the house and help her to recapture this business without you all having to take on this home purchase first? What is it specifically that you need to have that the home would provide? It's actually our municipality doesn't allow her business to operate from home anymore.

So it's pretty hard and fast. It's not even necessarily the space so much as, I mean, yeah, we could fly under the radar, but we want to honor the authorities in our area and not do that. So my point is, it is a pretty much – it's not up to us at all. As far as moving to a different space, we've run into a problem of the reason why she works from home at all, which is that we have two young kids on the way to a third, and that it would be unfeasible for her to work outside the home at all.

So actually – and we've discussed that previously. So right now, she's forgoing about $3,500 to $4,000 a month in income and has been for the last year. And the home is not even half of that different mortgage payment. And do you have some emergency funds that could carry you during that transition period while she regains those clients? We have about three months.

All right. Well, I would just really do the math there. I'd look for every other alternative that would allow you to store that business first.

Maybe she takes 30 days and works outside the house from a coworking space just to get all those clients back on board so you're not relying on the emergency funds right out of the gate. I mean, is there any other option? I want you to be above the law.

I mean, not above the law, but comply with the law. But I also don't want you to put yourself in financial hardship. So I think one of those two options makes sense to me, Leon. Appreciate your call, sir. We've got to take a break. We'll be right back. Delighted to have you with us today on Faith and Finance Live. We've got some lines open for your questions. 800-525-7000. Hey, are you looking to be a good and faithful steward?

Well, you're not alone. You can join thousands of others on a similar journey by signing up for your free FaithFi account today. Whether you've been entrusted with much or you're struggling to make ends meet, you know, we all need tools and people to help us on our stewardship journeys. Well, that's why we built the FaithFi app. It has tools, content and community to help you grow as a faithful steward of God's resources. So if you haven't already, be sure you check out the FaithFi app today. We'd love for you to join our community. You can do that quickly at faithfi.com.

That's faithfi.com or just search for FaithFi in your app store. All right. Back to the phones. All the lines are full, so we'll get to as many questions as we can today.

To Longview, Texas. Hi, Faith. Go ahead. Hi. This is my first time on your program. I've listened to you guys before.

You give great sound advice. So my question is, I'm a little old, I guess, for this, but I'm 32, and I just got my first car, like financing my first car, almost two years ago. So I've been paying on the car since October of 2021. And little did I know when I went in to get this vehicle, I went to Toyota to get a Toyota, and they pushed a Ford Focus off on me, and little did I know it had transmission problems. Now, it hasn't broken down on me yet, but I'm in a position where the interest rate is very, very high. It's at 20 percent. The car's original value was like 17 grand, and even though I've been paying on it for almost two years, I'm only down to like 14,000.

So there's only like 3,000 that's been knocked off of that original value because of how high the interest rate is. Now, I've got two options. I know I can either refinance and maybe pay that loan down some more before I trade it in, or I could trade it in, but I've been told if I trade it in, I'm going to be in a position called being upside down in a car note.

So I guess my question is, you know, what can I do as far as, you know, what would be the better sound financial decision? Or, you know, since there is something wrong with the vehicle and they've pretty much admitted to it, they just won't fix it. My car is at 88,000 miles, and the warranty only goes to 107.

What do I do if this thing doesn't break down on me before the warranty? You know what I'm saying? Yeah. So I guess that's the part that's a little confusing is you're still under warranty. They've acknowledged there's an issue, but they're not willing to make it right. Yes.

Yes. I could tell the first time I drove the vehicle that it felt like the transmission was slipping. And I'm no transmission specialist, but I could tell that. And Toyota said that they checked it twice and they had something called 150-point inspection and that it was fine.

But I continue to have problems. So I continued to take it to Toyota and they said, no, no, this is a Ford issue. It's a Ford. So I took it to Ford and Ford basically said that if I were to trade it in, it would take them that the car would be in their lot for a year because they said, if there's a problem that there's this little bitty part that would be required to fix it, but that this little part would be on backorder for a year. So I asked them, OK, was there something wrong with the vehicle or not? And they were like, well, we don't know. When we checked it out, it was fine, but it could also break down on you any day. I thought, well, great.

So I don't really know what to do. Sure. So who is offering the warranty? Is this an original manufacturer warranty or is it a third party?

You know, I'll be honest, I don't know. It just it came with the car. When I when I put my down payment on the car at Toyota, it's a certified preowned.

It came the warranty came with it. But, you know, it only of course, it only covers what's it called? Powertrain powertrain warranty. So it would cover the transition if that's the issue. The problem is, is I would have to get Ford or Toyota to acknowledge that that's the issue.

Yeah. Well, I think your best option, because Ford doesn't really have any stake in this, given that this is a preowned certified with a warranty. It sounds like offered by Toyota, even though it's not their car.

They were the ones offering it based on you buying it through them. So if you could get Ford to document the problem with which it sounds like they've done because they've said there's this part out there that's on backorder, which, by the way, it may not take as long as they're saying a lot of those supply chain issues are being resolved. If you could get them to document it, then I'd take it back to Toyota, assuming they're the ones that gave you that powertrain warranty to 100,000 and say, listen, manufacturer saying there's a problem. This is part of the powertrain.

I want to get this fixed. So that would be my first option. And then assuming it's in good working order, are you looking to sell it or does your boyfriend want to keep it? Well, I mean, honestly, I wanted to trade it in because of the issues that we already had with it.

But and I know he does, too. But being that, you know, it's got these issues. Plus, you know, I guess I didn't realize, you know, once you I mean, I guess I should have once you take out that loan on that car.

I mean, that's it. You know, it doesn't just go away even if you trade traded it. So what is the private sale value on this, assuming it was in good working order? Do you know what you could sell it for today?

You know, I looked up Kelly Blue Book and I want to say it. I was really shocked. I want to say it gave me like a price of six thousand something. What do you owe it? I owe like 14 grand. I've been paying on it since October of twenty twenty one.

So like I said, almost two years. But the interest rate is so sky high that even though I've paid, I think I calculated up over five grand. It's only gone down by a few grand. Yeah, yeah. Boy, and you're really upside down. That's really interesting. This car used car prices are still even though they've been coming down, they're still really elevated right now.

And you're saying you believe the car in good working order is only worth six thousand, you know, and you owe 14 on it. All right, let's do this. I've got to take a quick break when we come back. If you can stay right there, Faith, we'll finish up on the other side and talk about where we go from here. I'm really sorry.

I know this is a challenging situation. We've got a lot of calls still to come, but two lines open, eight hundred five to five, seven thousand. Stay with us. We'll be right back. Great to have you with us today on faith and finance live. All the lines are full.

So we're going to continue to tackle your questions one at a time. Faith called from Longview, Texas. She's in her 30s. She has a vehicle that has had some problems. It's a Ford that she bought from a Toyota dealership.

It was a pre-owned certified with all the inspections. Nevertheless, she believes there are some issues that may or may not be acknowledged by Toyota at this point related to the transmission. Good news is with eighty eight thousand miles or so, she's got a hundred thousand mile powertrain warranty.

So she's upside down, though. She believes the car is only worth about six thousand. She owes fourteen thousand.

And on top of that, the interest rates at 20 percent. So, Faith, this is a really challenging one. I think there's a couple of things. Number one is I tried to the best of your ability.

I know you have been. I'd continue to work toward getting this car to a place where you believe it to be in good working order based on what you know. And if you believe there's something wrong and you can get Ford to acknowledge that, I'd take that acknowledgement to whoever has issued the warranty.

And the good news is, as you said, the powertrain includes transmission. So let's see if we can get them to acknowledge that and make this right. And I would appeal to Toyota, given they're who you bought it from and it was pre-owned certified and they did all of their inspections. And despite that, it sounds like there are clear issues there that hopefully a mechanic will acknowledge and put it in writing. If you can do that, then the question is, do we sell it, refinance it or just continue to drive it as is?

I think selling it is going to be a problem because you're so upside down. You know, you'd still have, you know, eight thousand dollar deficit after you. Paying on. So it seems like the better option would be just to continue to drive it, assuming you can work to get the transmission issues resolved and look to refinance as you're able. And I would have the person who's going to ultimately be responsible for it do the refinancing. So if that's you, then you're the one refinancing. If that's your boyfriend, then let him refinance it. But let's try to get that interest rate down. Obviously, 20 percent is way above the current prevailing rates for a refi. But I realize your credit score plus the, you know, just how upside down you are and the fact that really they don't have any collateral because the value of the car is so much lower. That's what's obviously hurting you. So I think the you know, that's where we go from here.

But give me your thoughts. Yeah, so I'm actually I mean, my credit score isn't considered good, but it's pretty decent. It's almost 700 when I got the car.

It was 654. I think maybe the issue was maybe I just had a little bit too much credit already going into getting the car note. But since I've been paying faithfully these car payments, it has boosted my credit score up by about 50 points. So I am in a better position credit wise. But yeah, I'm thinking a refinance would be a good option. My only question, I guess, to you is so my boyfriend and I do plan on getting married.

And so we do live together and we will be sharing everything. But if I were to the car is in my name now, if I were to use his income to refinance, would I have to have the cars already in my name? So I guess my question is, if we refinance the vehicle, do we have to put him on the vehicle to do that? Or can you just use someone's income that lives with you? No, no, he would have to be a party to the note in order to use his income.

But I would caution you on that. I mean, to become one when we get married, you guys aren't married. So I would, I wouldn't be, you know, joining your finances at this point. I'd wait until you guys get married to do, you know, to move in together and to start commingling your finances. Co signing doesn't apply when we're married, it does apply to everyone else, even those who think they're going to get married.

But bottom line is, yes, if he is, his income is going to be a party to this, they're going to attach him and make both of you equally, equally responsible. Okay, okay, I see. Okay, well, it sounds like there's a lot of decisions I need to make here.

It's a challenging situation. I'm really surprised that you're so upside down on a used car. I mean, this, you've been paying on it faithfully. I don't, I don't understand how you overpaid so much for this car, because used car prices have been holding up.

So there's no way, unless you just really overpaid to Toyota, there's no way you should be that upside down on this car. But hey, it's a learning experience. I'm not trying to make you feel bad or point any fingers. Listen, you guys will get through this. You'll learn from it.

And you'll be better for it down the road. Let's just try to make the wise decision the best we can moving forward. All the best to you, Faye. Thanks for being on the program today. We appreciate it and for your kind remarks.

Let's see, to Chicago. Asaf, thanks for calling. Go ahead, sir.

Hello, thank you for accepting my call. Sure. So I'm a Portuguese Indian citizen. I'm right now a student here in the U.S. in Chicago. Okay.

I'm giving some context here. I have no debt. I have no car. I have no credit cards. I have just a debit card and a budget.

I work full-time during the summer and then during the semester I'm a part-time worker. So my question comes down to how do I save money or invest it as I'm not an American citizen? How would that work?

Yeah. Well, first of all, a debit card and a budget is a great start. So I love the fact that you've got a spending plan. You're ahead of a lot of folks here in this country. You've got a debit card because you're just going to spend what you bring in. It sounds like you're not trying to live outside of God's provision.

That's huge. That puts you way ahead of most people in this country. And beyond that, you already are going to stay completely debt-free.

I also love that you're thinking about how you can begin saving for the future, even while you're working and going to school. The good news is, even if you're a citizen of another country, as long as you're legally able to live and work in the U.S., the IRS views you as a non-resident alien for tax purposes. And while some people might believe that retirement accounts are only available to citizens, non-citizens can have a 401k and a traditional or Roth IRA too. Now, if you decided to leave the U.S. before 59 and a half and you wanted to take the money out, you'd be hit with a 10% penalty on top of the taxes.

But as long as you're willing to leave it until 59 and a half, you absolutely can contribute. So if you don't have a 401k available to you, I love the idea of you at your age setting up a Roth IRA at Fidelity or Schwab, and then starting an automatic systematic contribution up to your earned income or $6,500 for 2023, whichever comes first. And you could go to soundmindinvesting.org to get some help with some mutual fund suggestions.

Or if you wanted to use some faith-based investing mutual funds, you could head to our website at faithfi.com and click on the show and look at some of the great faith-based investing fund families that are out there, like Eventide and One Ascent and Praxis and so many others. So is that helpful though to you? Yes.

You mentioned Roth IRA. So as a non-citizen, I can even do that as well? You sure can. Absolutely. As long as you're a non-resident alien for tax purposes, that means you're able to live and work in the U.S., you can absolutely open a Roth IRA.

Okay. And how do I do that? Just head to either Fidelity or Schwab on the web and open an account, and there'll be an option there for a non-resident alien. They'll ask you for some information that you'll put in, but they'll allow you to open that account. And then you can start making systematic deposits from your checking or savings account. And then at that point, you'll want to start making some investment selections.

You could use ETFs like indexes or some high-quality mutual funds. And our friends at soundmindinvesting.org can help. In fact, let me send you a copy of the Soundmind Investing Handbook.

That'll help you get you up to speed on investing. So stay right there. We'll get your information.

A quick break and back with much more. Stay with us. Well, if God owns it all, and He does, then we're stewards or managers of God's resources. Hi, I'm Rob West. Here on this program each day, we want to help you be a wise and faithful steward, understanding the Council of Scripture as it relates to money and money management, and then helping you apply those principles and big ideas to the decisions and choices you're making today.

So what are you thinking about financially? I've got two lines open, 800-525-7000. Let's head to Florida. Hi, Dawn.

Go right ahead. Hi. Thank you, Rob. My mom is—I'm making a financial decision for my mom with my sister. She—we've handled her finances. She has late-stage Alzheimer's and has actually been in hospice for over a year.

We're told that she doesn't have long, but still has been lingering. And so we have—she has had a long-term care policy, and she is coming to the end of that. We bought a Care for Life contract with the facility. So she's been a private pay patient for the last five and a half years, but I need to transfer her—start to, you know, get her the process she had in place so that when this long-term care policy runs out in a few weeks, that Medicaid could take over if she continues, you know—she's not ready yet to be with the ward. Sure. Over the course of the last year and a half, she—her long-term care policy started paying at a higher rate than the facility, and then mom would get her Social Security. So where we had no money in the account for years, now we have accumulated about 20-some thousand dollars. And we have been told that—an elder law attorney said that we could do a personal service contract and pay ourselves to be—continue being her caregivers as we have been, whether several days a week, we're doing our finances, insurance, doctors, all that kind of stuff.

Sure. Doing that, you're paying the attorney, and you're also, you know, paying income tax on that bit of money. I'm not—I have some reservations about whether that's an ethical thing to do, but I know my mom would want us to have that money, you know.

And so I guess that's some of my question is, you know, what's right? I have—my sibling would like us to go ahead with the contract. If we wait, then we're private pay, and up until the time that Medicaid would kick in, they will look at those assets and draw on those assets to pay for anything until they start paying. So when we—the facility has been great. They—my mom was short finances for a little while, and she was not using her long-term care policy. They gave us benevolence.

We've reimbursed all that. She reties on all the increase for her Social Security and the long-term care money, you know, and I would like to maintain control of that money, you know, in—but again, I'm just trying to determine it just because it's something that's an option, and, you know, legally you can do. I'm just—I'd like to have the Lord say this is your inheritance and trust him with the timing, you know, of mom's passing. Sure, sure.

Yeah, so, well, there's obviously a lot there. I'm so encouraged by just how you all have approached this, Dawn. You clearly want to honor your mom and honor the Lord in this process, and from everything I'm hearing, you've absolutely done that, and you can know that God is smiling at how you've approached this. In terms of, you know, what's right from a legal standpoint on you being paid as a caretaker out of these assets and drawing them down and so forth, you know, I would take the counsel of that attorney. I'm not an elder care attorney, and they can tell you whether that's perfectly normal and customary and lawful. I think you always then want to take that against kind of the convictions that you have.

Pray through it and think through it. If you had a check in your spirit about that, then I would lean into that and just talk through it, you and your husband, and decide how you want to handle that. But, you know, clearly depending upon that wise counsel from a competent elder care attorney, as long as you don't, you know, have any kind of conviction otherwise, then I would say that's perfectly appropriate. You, of course, should apply it, I think, for Medicaid assistance, even though it could take a few months for the benefits to begin. I obviously don't know how long your mom will be with us. If you can afford to keep her in the current hospice situation without moving her, that would obviously be ideal. As you probably know, she can have up to $2,000 in assets, not including a home, and then a monthly income of around $2,700. And then if she receives the Medicare benefits for any appreciable length of time, the state could come after the home after she passes.

So, I would obviously prepare for both possibilities that she may or may not need the Medicare assistance, but go ahead and apply. And I think ultimately whether you, you know, start paying yourselves out of those assets as the caregiver, that's really up to you guys as long as you get counsel from an attorney that says you can. Okay. All right. Yeah, thankfully she has a Care for Life contract, so she's not going to be moving her or anything.

Everything will stay the same for her. Okay. Great.

And that's obviously the most important thing. So, the big question for you all is whether or not you start to draw down those assets. Did I lose you, Dawn? I'm back, I think. Oh, okay. Okay. Yeah.

Is that the big question, just whether or not you start to draw down those assets and pay yourselves? Yes, it is. It's just, you know, I want to do right by the facility, and so I need to tell them very quickly, you know, that we need to transition and have this in place for them. Sure. Yeah. And it's just, you know, wanting to keep the peace, you know, in the family.

Yes. Do you have reason to believe that some of your family members would take issue with it? You know, my sister wants to wait, too. It's just funny that my mom has lingered so, so very long.

Hospice is even wondering, you know, we're all kind of wondering, you know, the why behind all that. You know, I volunteer. I have not worked outside the home for 26 years, and so I don't pay myself.

You know, I don't have a salary and stuff like that. So I just don't want to lay claim to something and say, you know, like, this is a right or something that I deserve or earn, which is why I'm always like, I want the Lord to be able to do it. And I don't know if it's just my weird mentality that's getting in the way of, you know, saying this is acceptable and right and okay to do.

Yeah. Well, I think make it a matter of prayer. Let's ask the Lord to give you all peace of mind as to what the right approach is, you and your husband together and with your family members. And but as long as you're in good standing with the law, I think ultimately this is a conviction matter. And so I would just pray through it and ask the Lord to just confirm how you should proceed.

And I certainly don't see anything wrong with the direction that you're talking about here. Dawn, listen, all the best to you. We'll pray that the Lord continues to be just incredibly gracious to your mom in these last days before she's face to face with him.

And we all long for that day. And I appreciate you sharing your story with us today. God bless you. To Tennessee, LaShonda, thanks for calling. Go right ahead. Hi, Rob.

Thank you so much for taking my call. I have two questions. One regards to what you started your talking about earlier about co-signing. Now, I know from experience when I was 18, 19, my mother had a co-sign for me a vehicle so I could get back and forth to school because I went on to a college and I didn't have any credit.

So I know this issue is going to come up. My question is, I have two children, a 14 and a 12 year old. What can I do to help them so that when they turn 18, they'll have some credit established?

Yes. So one of the things you can do is establish them as an authorized user on your credit card. You wouldn't have to give them the card itself to use and you can do that depending upon the card issuer as early as age 13. Typically, you can add them as an authorized user. So all of your credit history will go to their credit report now.

That includes good and bad history. So if you were to be late on a payment, that would be reflected. But that would be one way you could do it through an authorized user status. The other one would be having them, once they're 18, open a secured credit card where you put a certain amount on deposit and then they use it for budgeted items and then pay it off. That's reported to the credit file. But then, you know, there's no risk of them defaulting because there's an amount on deposit that's collateralizing anything that they borrow.

Those two things are the best options. If you were to take on a car note for a child, you would just need to be ready, willing and able to step in and pay it in the event that they can't. They're young, they're learning, they don't have steady income. And so if you're extending your name for that, you're going to need to be willing to step in so we don't have damaged credit and damaged relationships.

But the authorized user is probably the best option for you at this point. Okay, that's what I wanted to know about that because, you know, when they turn 18 and they go out and get into debt on their own, then that's their choice. I want them to be able to at least have some credit where if they do want to take out a loan, then they have that option because I put them, I did what you just told me to do.

Yes. And my second question, my second question I have, Rob, and then I'll be finished, is my husband has had three major back surgeries and he's 45 years old and I don't see him ever been able to make it to the full retirement age. We have, I have him at 10% for 401k every week. And we also have an emergency fund because I know you said six months of expenses. So we have that.

And I've just got about 20 seconds left, unfortunately. Sorry, go ahead. Okay, so I'm making a extra monthly payment on our house every month.

Should I continue to do that or start putting that toward retirement? Yeah. Yeah, so there's a, I want to ask a few more questions in order to give you that answer. So let's do this. I'm going to have you stay right there. And we'll talk after the program if that works for you. LaShonda, thanks for your call today.

John, Monica, I apologize we didn't get to you. We'd love to get you on the broadcast tomorrow. If you all want to stay right there, we'll try to get your information and get you on the line. Folks, thanks for being with us.

Faith and Finance Live is a partnership between Moody Radio and Faith Fi. Thank you to Lynn, Dan, Tahira, and Jim. We'll see you tomorrow. Bye bye.