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A Tidal Wave of Wealth

MoneyWise / Rob West and Steve Moore
The Truth Network Radio
September 18, 2023 5:42 pm

A Tidal Wave of Wealth

MoneyWise / Rob West and Steve Moore

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September 18, 2023 5:42 pm

There’s a financial tsunami coming, but it’s not what you might expect. And it’s not about debt. Instead, it’s a tidal wave of wealth. On today's Faith & Finance Live, host Rob West will talk about how analysts predict that by 2030, the Boomer generation will transfer an immense amount of assets to their children. Then he’ll answer your questions on various financial topics. 

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There's a financial tsunami coming, and it's not what you might expect. It's not about debt. It's actually a tidal wave of wealth.

Hi, I'm Rob West. You might call it the baby boomers' last hurrah. As they pass away, boomers will transfer an immense amount of assets to their children. Analysts are calling it historic. 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 journey. Well, first, let me give a hat tip to our friends at the Gospel Coalition for a great article on this topic, and we'll put a link for it in today's show notes. Now, I said a tidal wave of wealth is coming, and that's really an apt description. It's estimated that by 2030, not that far from now, the baby boomer generation will pass nearly $68 trillion in assets to their children. And yes, that's trillion with a T. Analysts say that by 2030, millennials, those born roughly between 1981 and 1996, will hold five times as much wealth as they have today.

Can you imagine that? Now, obviously, not every millennial is going to have five times more in assets. That's a nationwide figure. But I think we can safely say that in general, the children of baby boomers will have a great deal more wealth within a few years than they have now. So the question is, what will they do with it? More specifically, what will Christian heirs do with that money? How much will be given to local churches and global missions? The answer, of course, depends on the generosity of future generations.

And that's a cause of some concern. By one estimate, boomers and their parents have accounted for nearly 80 percent of church giving in recent decades. As boomers pass away, churches are grappling with the loss of their giving. That loss is only the latest in a decades-long decline in giving. Seventy years ago, religious giving made up 70 percent of all charitable donations in the U.S. By 2021, that had shrunk to just 27 percent of all donations. As one might expect, the passing of boomers is having a significant impact on smaller churches where any loss is felt more acutely. But large churches are seeing the downturn in giving as well. By one estimate, the largest evangelical churches experienced a seven percent drop in giving during COVID, despite a four percent increase in all charitable donations for the period.

Now it's not all bad news on the giving front. Another study is showing that younger generations do see charitable giving as a priority, even if it means putting off spending in other areas. And this is where Christian boomers can have a huge impact by modeling generosity to their adult children. They are more likely to take on the generous traits of their parents and grandparents if those values are clearly communicated.

Joel Robinson, author of the article I mentioned, gives three ways to do that. First, you need to engage with your family. Meeting and communicating with family members is a key part of setting up a plan to transfer wealth. You want to avoid surprises, and all heirs should feel included in the process and mutually responsible for its success.

These discussions don't have to be formal, stiff affairs. They can provide an opportunity for parents and grandparents to express their wishes and share stories about how God provided for them. The older generation can encourage the younger to think about an inheritance in a purposeful way and how it can further the kingdom. But it has to be done while the benefactors are still living. Next, boomers must actually plan their estates. This is the point where values are expressed in money itself, and it presents an opportunity for a well-planned estate to carry a legacy of generosity to future generations. An estate plan can do much more than simply hand out wealth. It can also define a charitable giving strategy and the means for making that strategy a reality.

When the plan is in writing, confusion is minimized. Another item that aging boomers may want to consider is something called an ethical will. This is basically a document that captures your life story, your religious values, ethics, and beliefs. These are provided to convey those details to future generations. And that leads us to the third way the older generation can leave a legacy of generosity, and that's to educate and encourage their heirs.

Financial literacy is a major problem in the U.S. Leaving large sums of wealth to the next generation could do more harm than good if the heirs are unprepared to handle it. Christian boomers must pass on their wisdom and values in addition to wealth to leave a lasting legacy of stewardship and generosity. All right, your calls are next, 800-525-7000.

That's 800-525-7000. I'm Rob West, and this is Faith and Finance Live. We'll be right back. Thanks for joining us today on Faith and Finance Live.

I'm Rob West. All right, let's take your calls and questions today on anything financial. I've got some lines open. You can call right now at 800-525-7000. Again, that number, 800-525-7000.

We're going to head to Corbin, Kentucky. Hi, Dan. Go ahead, sir. Hi, good afternoon, Rob. Thank you for taking my call, and first of all, thank you.

I spoke with you about a month ago. You sent me a book titled An Uncommon Guide to Retirement. I cannot recommend that highly enough. It's been a tremendous help. It's been a tremendous, tremendous help for me.

We've also connected with a Kingdom advisor down here in the Lexington area. My question, in brief, is what is your opinion on utilizing annuities in leaving a legacy to our kids? The reason I ask is I'm in a rather unique position. After talking to our CKA, we've discovered we're in a much better position than we thought.

I'm a retired federal employee, and we're good financially, but there's been some discussion from the CKA about considering, although it's not necessary, but considering utilizing annuities as a way of passing on wealth to the next generation. So I'd just like to get your thoughts on that. Thank you again for your ministry. Well, thank you for saying that, Dan, and I appreciate that.

I'll get to your question. Give me what's kind of the one big takeaway that An Uncommon Guide to Retirement by Jeff Hainan helped you with. What was something that you really took out of that? Well, primarily it's his emphasis, at least in a portion of the book, on taking a sabbatical of sorts to determine what your direction should be, what God wants you to do, and to not feel like we have to rush into something, but to take that time of rest and reflection and spend time with the Lord, spend time with the Lord to make sure we're not flailing, but we're purposeful in what we're doing. Yeah, that's such a key idea that Jeff really doubles down on this idea, especially in early retirement of a sabbatical rest. Well, thanks for mentioning that.

I'm delighted to hear that was helpful to you. I'd love to know more about the reason for the recommendation. I mean, certainly annuities can be used as a part of an estate plan. I'm not the biggest fan of annuities.

They're typically sold, not bought, meaning people don't go out looking for them. They tend to have high fees and commissions, and they limit you on two things. One is the gains you can make with the money, and the second is access to the money. Now, some folks, though, who are risk averse, are willing, because of the peace of mind that it gives them, to give up the upside potential, because essentially you're trading potential gains in the market for the security of guaranteed payments.

The question is, is that a worthwhile trade-off? And I think you're in a great position now understanding that you have defined how much is enough. You believe you've accumulated enough. I mean, it needs to be managed well from this point forward, but your trust is in the Lord. You have these resources that God has provided to you, and you're saying, so who's the next steward, and are they chosen and prepared? And I think you've got to look at, first of all, what's the opportunity to do some giving now? I love what Ron Blue says, do your giving while you're living so you're knowing where it's going. And it's kind of a fun way to say, well, let's think about once we know what enough is, getting that money into God's economy sooner rather than later so we can enjoy it and be a part of it. And then of course, there is that kind of estate plan wealth transfer decision where apart from the government, the only two places we can leave it are heirs and ministry or charity.

And so then we need to make sure, you know, we've selected that steward, we've made sure that they are chosen and prepared. When it comes to heirs, we want to always be saying, okay, if we give X amount to X person, what's the worst thing that can happen? How serious is that?

And is it likely to occur? So for instance, a child that's making poor lifestyle decisions, a lot of money in his or her lap could accelerate that move away from God. And so we need to really think deeply and pray about that. I think also we need to think about how do we give money away at the end of our life. And you know, for some folks they need income now, but they want to give it away at death. So they look at things like charitable gift annuities. For others, they, you know, just start giving it away right now. But I guess I don't understand fully the reason that that's the recommendation.

Do you have a sense of why he's recommending an annuity versus just keeping these assets, beginning to give them away now, but then ultimately gifting them as a part of your estate plan outside of an insurance contract at death? I'm not, we're going to be having another sit down discussion. I'm not clear on all the reasoning.

It was just touched on briefly as we've been laying the groundwork. But again, the Lord has blessed us so richly. I didn't anticipate being in this position when I retired. I thought I'd have to go back to work. And because of the situation we're in, I don't have to do that. You know, we're fully covered in terms of our budget and that. And I think the idea is that it's not necessary, but it may be a way of capitalizing on the fact that I have what is part of a dying breed, I guess, of retirement, which is I have a fixed annuity. I excuse me, a fixed retirement that I'll get for as long as I live and a survivor's benefit from my wife.

So regardless of how much I've paid into it, I could stand, Lord willing, I live that long to draw out of that far more than I put into it, because it's a guaranteed income. Yes, yes. Okay, very good. Well, perhaps you just need to see this through. Let him explain fully, you know, what the plan is. And, you know, it could be that this does make a lot of sense in this season of life. We want to minimize taxes. We want to maximize the amount you can give away, you know, based on the income sources, this guaranteed retirement plus the assets that you've accumulated.

And it could be that that vehicle that he's proposing, you know, does just that. I think I just don't have enough detail. So I would maybe push you back there and say there's not any red flags here necessarily. I would just make sure you understand why it's being recommended and make sure that it does in fact fit with what you're looking for. Also look for opportunities to, you know, do some some giving either to heirs or to ministry or charity while you're alive, to the extent you're going to have a surplus. But then I hope that helps you if we can help further along the way as you get some of these questions answered, don't hesitate to reach out to us.

But may the Lord bless you. And again, thanks for your kind remarks about the program, sir. By the way, the book that Dan mentioned that we sent along as our gift is from Jeff Hanen, published by Moody Publishers. It's called An Uncommon Guide to Retirement, Finding God's Purpose for the Next Season of Life. And it tackles things like what Dan mentioned, the importance of a sabbatical rest in early retirement, listening to God's voice for your calling in retirement, rethinking work in retirement and even leaving a legacy.

It's just a phenomenal event. And if you're entering that season of life or maybe you're in it, perhaps this is a resource you might want to pick up. Let me also mention before we head to this break and by the way, we've got some lines open at 800-525-7000.

We will be Dee and Mac and Rick coming your way just on the other side of the break. But let me mention before we head to the break that Faith in Finance Live is listener supported. So here as we head the beginning of heading into the fourth quarter here, this is a critical time for your financial support to our ministry for us to stay on track between now and year end so we can continue the work that God has called us to next year.

If you've found benefit in this program, you'd like to support this work, it's quick and easy to do on our website. Just head to faithfi.com. That's faithfi.com and just click the give button. You can give online over the phone or you'll even find our physical mailing address to send a check through the mail. It's a tax deductible gift and you can make it online at faithfi.com.

Just click give. All right, we're going to take a quick break when we come back. More of your questions. Plus in our final segment, Bob Doll stops by to talk about what's coming with the Federal Reserve meeting this week.

That and much more just around the corner. Stay with us. Well thanks for tuning in today to Faith in Finance Live. I'm Rob West, your host. All the lines are full, so let's get to as many questions as we can.

Ocala, Florida. Hi, Rick. Go ahead, sir. Good afternoon.

Hi there. I am. I'm 58, almost 59.

My wife's 57. We met 13 years ago, broke. We have worked through some plans. We've paid off everything. We owe about 75 on the house. We have no other debt. She has 150 a year in income. I'm making about 60.

When's enough enough? That's a great question. So talk to me about, you know, as you all have taken a step back and you just talked about your values and your priorities, I mean, what's most important to you guys and where are you headed and how does that then translate into financial goals as you look out into the future? Well, we took the time to pull all of our funding out of secular investments.

Okay. We wanted to go ethical based. I was pastoring a small church in north central Arkansas before moved here to Florida. And so we pulled everything out and we went into Guidestone and a couple of other investments. And we're, we're at a, I hate to say a stuck point, but you know, she wants me to retire at 62. I'm kind of feeling that maybe we're, there's not enough set aside. I think we have about 200,000 in our retirement accounts and you know, I feel like, I don't, you know, I feel like maybe we need to talk about longer and you know, we want to be able to give and provide for the kingdom.

Yeah, I love that. Well, you know, as you think about your financial situation and into whatever God's calling is next for you in that season of life, you're talking about retiring from perhaps paid work to redirect your energy to whatever God has in store, which may be more volunteers work. Maybe it's continuing to teach.

Obviously the Lord has gifted you there. You know, maybe it is something that does involve a different kind of work, maybe even for pay down the road. As you well know, we were created to be workers in the image of God and his calling doesn't expire until we're, until he calls us home. So, but I also recognize we want to be wise and faithful stewards and that includes saving appropriately. And so we have to take a step back and define our goals. And one of those goals is to be able to provide for ourselves and our loved ones, you and your wife, in that season of life where either you can't work or God redirects you away from paid work. And so we start by saying, okay, what would our lifestyle look like that we believe God has called us to?

And that's a prayerful decision in and of itself. How much is enough for our spending even before we get to how much is enough for our accumulation? But once we've defined that, then we can put a spending plan together that says, okay, in retirement, this is how much we believe we'll need to cover all of our expenses.

We know that it gets simpler in that season of life because I don't know whether you all have kids, but if you do, hopefully they're off the payroll. You know, if you said you don't have any other debt, maybe one of the goals is as you enter retirement to have the house completely paid off. So that just takes this largest expense off the table. There are other expenses that generally go away.

Usually life insurance is no longer needed, things like that. So we get to this retirement budget, if you will, and then we compare that to known income sources. So if your only income source between the two of you or sources is Social Security, well, we've got to match that to the budget and say, what's the gap going to be?

And then we have to answer the question, how are we going to solve for that? And usually we would say, well, you know, just a general rule of thumb and that's all it is, is you need to have 10 to 12 times your income because if you, if you have that and then you pull 4% a year off of that plus Social Security, you should be able to get back to that 80% of your pre retirement income. If you don't have that, well, that's fine, but we just need to know that if we're pulling more than 4%, we get up to, you know, 5, 6, 7, 8% a year of your retirement assets, well, they're going to be declining over time.

And so either A, we're going to run out of those eventually or B, we're going to have to continue to work part time to generate income. Have you all kind of talked through those pieces and do you know what your income needs will be in retirement? We've explored it and of course I showed earlier, I don't, I didn't share it with you, but we're 70,000 left on a $250,000 home. And that should be paid off by the end of the year. We didn't have a mortgage when we bought the house in Florence to move down because my parents are three miles away. We're here kind of caring for them.

She travels for work. But yes, we've looked at it and you know, we've talked that, you know, at this point, we're living on about 2000 a month. Yeah, and you're bringing in 200,000 a year. Yes. Yeah.

Yeah. So you're in a great opportunity here to do some planning, Rick. And I think this is, this just really highlights the value of having an advisor who shares your values because if you had somebody who perhaps does and they might just say, well, let's just accumulate as much as we can.

And although there's probably still some accumulation that needs to go on that you and your wife need to consider prayerfully, once you define enough, the good news is you can get debt free and based on your modest lifestyle and your really significant income at more than 210,000 a year, you should be able to save quite a bit. But you need to know what your ultimate goal is and why. And then you may be able to accelerate some some of your giving now because you know that you're on track to over accumulate or you may say, no, we're not quite there yet. So we're going to continue doing what we're doing, but we're really going to focus on socking money away and getting it invested and growing because we're not at that ultimate goal yet.

And we do want the ability and let's say in the next five years to redirect away from paid work or maybe it's seven years, you know, and be able to follow God's calling on our lives. So I'm going to suggest, Rick, you connect with a certified kingdom advisor there in Florida. Just go to our website at faithfi.com.

That's faithfi.com. Click find a CKA and you could find two or three to interview. You're not necessarily at this point looking for investment management, although you'll probably need that too.

Really, it's retirement planning, comprehensive retirement planning in light of your values and priorities as a believer, but also considering the financial implications. I think that will give you the peace of mind you need. Thanks for your call. We'll be right back. Well, it's great to have you with us today on faith and finance live.

I'm Rob West. You know, we were talking at the beginning of the program today just about this tsunami of wealth transfer that's occurring as the baby boomers transfer an immense amount of assets to their children. Analysts are calling it historic. I mentioned before the break that one of the decisions we have to make is choosing the next steward and ensuring that they are, in fact, prepared other than the government. The only two places you can leave assets are your heirs or beneficiaries and charity or ministry. And really answering the question, if we give this amount to this person, what's the worst thing that can happen?

How serious is that? And how likely is that to occur is really essential. You know, one of the principles we also need to deal with in this decision is really the treasure principle. We find it in the book called The Treasure Principle by Randy Alcorn. And it comes to us from Matthew 6 and Luke 14.

But it's the idea that you can't take it with you, but you can send it on ahead. And, you know, we need to recognize that we need to be making investments in the eternal, and we can do that through our kingdom giving. We also need to recognize the principle that God gave you a spouse to complete you, not to compete with you. And so we may have different goals and feelings as husband and wife, but we need to work through those together and really think about where God is taking us as a family, how we want to handle our wealth transfer decisions, making a matter of prayer and lots of conversation as we make these difficult decisions together.

But unity and oneness is ultimately the goal. All right, let's head back to the phones. By the way, Bob Doll stopping by in our next segment of the broadcast. We'll look forward to getting Bob's take on the markets and the economy, especially with the Fed meeting coming up on Wednesday.

We'll see what Bob's thinking about that. To Cleveland, Ohio, Lee, thanks for calling. Go ahead.

Thanks for taking my call. I am in my upper 50s. And I would like to buy a house. But I cannot save the 20% that you recommend that we save to buy to put down payment.

What is the next options? I I have a 401k or should I borrow it from the bank? Yeah, it's a good question. And I can understand why you'd want to go ahead and make that home purchase. Let me just ask a couple of questions. So do you have what I call an emergency fund of three to six months expenses?

Yes, it is. Okay. And then separate from that, how much do you have that you could put toward the down payment? I have about only 8000. Okay. And what do you think you might spend? I mean, as you're looking around at houses, and you consider your budget and what you can afford in terms of a mortgage payment, what do you think your purchase price will be? Around 200.

Okay. So I mean, the goal we would want would be 40,010 percent would be 20,000. Obviously, you're at 8%, so less than 5%. So the challenge there is, you know, on top of the, the, the insurance, you're going to have to pay on a PMI private mortgage insurance, which could run you one to 2% of the mortgage value, and that doesn't do anything for you.

It just doesn't give you a whole lot of room for the market to move without you potentially being upside down. So let's say though, you did get a 95% mortgage, but even then, that's going to push the interest rate up higher than it already is, which is around 7.2 right now today. Have you run the numbers to see what that mortgage payment would be, including principal interest, taxes and insurance? And have you compared that to what you're paying in rent? Yeah, if I don't put, if I just put what I have, I've down, it'd be more than what I pay in rent. Yeah, yeah. And what percentage of that is your of your take home pay? Do you know? The mortgage, it would, it would be roughly about 45.

Yeah. Yeah, I just can't recommend that as much as I'd love for you to get into a homely and I understand that you're saying well, but what's going to change down the road? Because if I'm not able to save, then you know, I'm not going to be able to be in a better situation. And the only thing that could change down the road is first of all, I would challenge you to say, all right, how do I go back to the budget and trim expenses so I can save and continue to build on that 8,000? You know, the reality is if that, if the payment is going up, so if you're saying it's going to be 45% of your take home pay, if you get the mortgage, which is more than your rent payment, and then you got taxes, property taxes and homeowners insurance on top of that, and then you have perhaps some additional, well, you will have additional maintenance costs of you owning a single family home versus you being a renter. And so let's say we were to put away 1% of the mortgage every year or the home value every year just in a maintenance fund for you to be able to take care of it. I mean, you're going to quickly, if you're already living paycheck to paycheck and there's no margin, you're going to be upside down. And now we're in a situation where you're upside down every month and you could put your home at risk and now we're in a lot worse situation. So as much as I'd love to be able to say, yeah, let's do this.

I just think that, you know, I'm not seeing a path forward where that makes sense. Instead, what I would do is continue to rent. I would focus on your budget and your spending plan to try to trim your expenses as much as possible. I'm glad to hear you have that emergency fund. Let's take whatever else you have in surplus and assuming you don't have any consumer debt like credit card debt or other types of debt that you're carrying a balance on, then let's focus on continuing to build that home savings account such that maybe a couple of years down the road, interest rates are in a much better situation and maybe now you do have more saved such that, you know, you can go in, you know, with more equity, hopefully getting to that place at some point where you don't have private mortgage insurance and then you're also ready for the mortgage payment that will result so you don't put yourself in a hardship situation. Does that all make sense?

Yes. So borrowing against my 401k is not a good idea. It really isn't because number one, that money is supposed to be in there for you to have for the future. And as soon as it comes out, it can't recover with the market because the market's still down by all accounts.

And, you know, it's not there to grow. Number two, if you ever separate from the company, you've got a huge tax bill, probably a minimum of 30 percent between the penalty and the taxes. So I just don't like that. I mean, if anything, you may want to dial back the amount you're putting in for new contributions, but I wouldn't be borrowing from what's there. What percent of your paycheck are you putting into your 401k right now?

Six percent. And that's what my employer matches. Okay. Yeah. So I would keep that right where it is. After you make that six percent contribution and after all your bills are paid, what do you have left over?

Anything? Yes. I usually have something left over that I keep putting into the savings to roughly about 200 a month. Okay.

Yeah. But I would suspect that that mortgage at seven and a half percent plus the private mortgage insurance plus the taxes and insurance and any kind of maintenance you need to put aside for the house would probably eat up that 200 and then some. And now you might be going under water in certain months and that's just not going to that's going to lead toward credit card debt and it could ultimately lead toward a foreclosure. So if it were me, I would continue to fund and take full advantage of that six percent matching like you're doing. But I just keep saving. Let's save as much as you can and let's hopefully see these interest rates come down over the next couple of years and then we can kind of revisit this idea of a home purchase. Lee, I appreciate your call today.

I know that probably wasn't what you were hoping to hear, but I think that's going to be the most prudent path forward for you as a steward of God's money. Thanks for your call today. We appreciate it. Well, folks, we're going to take a quick break. We come back. Bob Doll's going to stop by and then we'll finish the program with as many of your questions as we can get to.

Stick around. Great to have you with us today on Faith and Finance Live. I'm Rob West. Well, here at our final segment of the broadcast today, we're going to talk to our good friend Bob Doll.

He's chief investment officer at Crossmark Global Investments. And Bob, it's a Fed meeting week, which always brings some interesting moves in the market. And I know you're watching as well for what their comments are going to be.

What are you expecting? First of all, that they do nothing in terms of rates, which is what everybody widely believes. But they're going to have a lot of comments about, wow, inflation's made good progress.

But it's not where we want it to be. Economy is doing a little better than we thought. Who knows? I think we'll read between the lines to try to figure out, well, what are they going to do with November and December meetings?

My guess is they will pick one of those and do another twenty five. We'll see. But no rate cuts anytime soon in the new year unless we're in a recession.

Very good. Bob, in your deliberations this week, you've been you were talking about a number of things related to a softening of the economy overall. The job market starting to cool. The fact that excess savings are shrinking.

Payroll growth looks set to slow. Global manufacturing weakening across the board. Why are we seeing all of this show up in a stock market sell off quite yet? Well, I think first of all, it's a function of the Fed's raising of rates. Remember the long lag between when they do their thing and when the economy feels it. So I think that's why the economy is showing those signs in terms of the stock market.

Why is it not reacted more? I think the consensus still is no recession. And so stocks are not selling off. If we get more of this weakness and it translates into some earnings problems, then stocks will sell off. And our guess is that will happen before too many weeks go by.

Yeah, that's helpful. What about the job market, Bob? What are you seeing? Job market is still strong, but starting to cool. We see the number of job openings, which were gargantuan compared to the people number of people looking for a job that's trended down somewhat. Supply demand gap is starting to narrow as well. So there are signs to repeat that the job market is cooling off from, frankly, a very blistering pace.

Yeah. And then what about just on the global front, you know, where are the most notable developments internationally? So we're still seeing the, well, we should start by saying the ECB raised rates, the European Central Bank, by 25 basis points, almost for sure, Eurozone heading into recession. China continues to be problematic.

They've done some stimulation. That is the government of their economy. Not a lot of impact there yet. And then the two big regions that are important.

So in other words to say it, in the United States, economic growth is a little stronger than it is overseas. Yeah. Okay. Well, Bob, I know it's a busy week ahead.

We'll look forward to you unpacking all of the Fed's comments when you stop by next week. But we appreciate your time as always. Talk to you then.

Bye. All right. That's Bob Dahl, Chief Investment Officer at Crossmart Global Investments. He joins us each Monday with his market analysis.

You can learn more at crossmartglobal.com. All right. Let's round out the program today with your questions to Cleveland, Ohio. Hi, Dee. How can I assist you? Hi. I have about 2% left on my phone and I was hoping you could text me. So you may have to answer my call, my questions without me being able to talk to you. I believe we can do it, Dee. I believe. Go ahead.

Okay. So I am 64 years old. At age 48, I retired from General Motors after working there 30 years from age 18. I retired with a full 30-year pension and at 62, I began to receive Social Security. I retired young because I was able to make as much money as possible before getting Social Security without penalty.

I did go to the airline and I've been a flight attendant ever since. So I did buy three investment properties, two are multi-dwellings and two are singles. I have no real estate debt.

My private home is one of those singles which I live in. And I have about $16,000 and a 401 with General Motors, which I left there after retiring. I have a broth with only about $5,000 in it. And I am at the end of my financial wizardry and I'm trying to find out what to do. I have one heir who's not a part of my investments and I manage myself. I'm a licensed realtor and I'm a certified paralegal. So I can do contracts pretty good and real estate pretty good. I have good tenants, but I am getting well, I want to do something different with my life. And I would like to hand him the responsibility, but he's not financially literate yet.

He is a college grad, but he has his own life and he now has a family with one child. So I have had a small tree removal company in the past. I have some older equipment, which I could sell because I'm not operating the company partnership that ended. So I'm just wondering what I should be doing right now. I don't want to liquidate because my real estate is probably worth over on the low side. If I liquidate it, I would probably have liquid cash on the low side about maybe $650,000. As I said, I don't have debt.

I don't have credit card debt because I only use American Express and you pay that every month. So what should I do? Yeah. Wow. Well, first of all, well done. You've got, you've built quite a portfolio for yourself. Sounds like you manage it all really well. I love that you're doing this all yourself.

I think this is a season where you just need to stop, take a step back and pray and ask the Lord what's next. Because, you know, if you don't have anybody to pass this off to, like an heir, you know, perhaps you, if you want to continue to hold it, you know, you could bring in a management company to manage it and use the income to go do whatever you want. I mean, you've got obviously social security in your pension. How much surplus are you throwing off every month?

How much surplus? Yes, ma'am. What do you mean?

Well, I imagine over when you've got you've got rental income plus social security plus pension, correct? Yeah. Okay. And are you spending all that liquid?

Not really. I mean, I've helped my son quite a bit. Okay. With the purchase of his home and some of his expenses quite a bit, I probably and I paid his way through college. He came out debt free and so did I. That's great. How much do you think you have surplus every month? It's almost embarrassing to say.

Because I don't have any Oh, I don't have much overhead. I imagine it's a big number. Yeah, it is. It is. It is maybe six, 7000 a month.

I don't know. Okay. And what do you have in the way of assets not including your pension, or the real estate? What have you accumulated in assets? Oh, well, I have eight automobiles, but I don't put money in cars. They're older cars, but they're all in excellent condition.

Okay. You know, one of the one is a dump pickup truck for the real estate. Of course, I need that 2500. And you know, I have stock and bond portfolios.

Well, you know what I'm afraid of? I'm the chicken when it comes to something like stock. I do. I have let General Motors make some decisions for me when I had money there. I liquidated a lot of it buying the real estate paying myself back through that process. And that's why I have only 17,000 sitting there waiting to and I wanted to take that and maybe get some gold, something I'm just not the type that can, you know, let someone else make my decisions in stock to me is too volatile. I've done well with the growth of real estate. And, you know, so so what is it that you feel like is the pressing decision you need to make right now? Because I don't, I don't sense you want to sell these properties.

You've got plenty of surplus. So what is it? Where's the pain point right now? What are you trying to solve pain point right now is when I do have to turn a property over and search for a new tenant, which is easy for me, but I just, you know, I had I was, like I said, I'm a designer by anointing. So I'm able to go in and redo the properties.

Just a couple weeks of doing that. But I just want to kind of want my life. I kind of want to be free. I kind of want to get into what the Lord has put in my vision. I want to write. I'm writing, you know, a spiritual play.

I want to produce it. I want to do other things that are more meaningful to me. I know how to make money. What about a property management company? Well, people are I've looked at that. And right now, like you said, the real estate market has changed.

Prices of everything is up. Rents are through the roof. And a lot of the companies have blind managers that, you know, get a lot of what do you call the application fees?

They don't call people back. I'm probably the last one that renters can talk to. So people are saying they're able, but managers are not really ethical.

I have really have to search hard to find someone who's ethical and honest. Well, it sounds like that may be a worthwhile endeavor, though, because you can't do it all right. So you want to own real estate and not a more passive investment like stocks. That's fine. You made a lot of money in real estate. You understand it. You've done well in it. Great. You want to continue to own it. If you want to be freed up to do what God has called you to do using your gifts and talents and the calling he's placed on your life and real estate is taking too much of your time, you're going to have to find somebody trustworthy that you can pass this off to that can continue to manage these properties.

Maybe not exactly the way you do it, but to do it in such a way that frees you up to go follow what God has for you next. Here's what I'd like for you to do. I want you to have you ever heard of the Halftime Institute?

Okay. I want you to check it out when we get off the air here today. It's called Halftime Institute dot com. And it's basically a ministry started by a gentleman named Bob Buford years ago. Bob has since passed away and it really helps people to experience the joy of creating a future so compelling that you can't not bring it to life. And it's really for those who have gone through their working years and they're saying we want to move from success. And I would say you've had some success. You've had a lot of it to significance. And not that we can't have significance while we work. We were created to be workers, but it's really looking at this second half of your life and saying, God, what's next?

And doing it through the lens of scripture and a biblical worldview. And I think once you get clarity on what's next, it's going to be easier for you to let go of some of the things you're doing right now, even though it's going to be hard for you, you're going to have to do it. But I want you to be so excited about what God has you for you next that you say, you know what?

It's worth it for me to walk away from that. So I want you to start there. Halftime Institute dot org. Check it out and then call me back once you get through that. We appreciate your call. Faith in Finance Live is a partnership between Moody radio and faith by see you tomorrow.
Whisper: medium.en / 2023-10-07 13:25:51 / 2023-10-07 13:42:47 / 17

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