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Financial School of Hard Knocks

MoneyWise / Rob West and Steve Moore
The Truth Network Radio
May 18, 2020 8:03 am

Financial School of Hard Knocks

MoneyWise / Rob West and Steve Moore

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May 18, 2020 8:03 am

Everyone makes mistakes when it comes to their finances even the best of financial professionals. The key when you make a money mistake is to understand that it’s not the end of the world and you’re not alone. On the next MoneyWise Live, hosts Rob West and Steve Moore share some common money missteps. The financial school of hard knocks on MoneyWise Live at 4pm Eastern/3pm Central on Moody Radio. 

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There is this one make a mistake choice 5257 financial school of hard knocks that snacks right here moneywise Rob.

That was an interesting quote. We opened with it reminds me of of this one insanity is doing the same thing over and over again and expecting different results.

It's exactly right. And we don't want to do that Steve.

We all need to learn from our mistakes and use that self-education and I use the term loosely to constantly improve how we manage money. I say loosely because God's word is full of wise advice so he is the real teacher.

Well let's get started and what's our first common financial mistakes while Steve Moore it's simple but profound and it is spending more than you earn, it inevitably leads to that which is really financial bondage world familiar, perhaps with Proverbs 22 seven the rich rule over the poor and the borrowers slaved to the lender. You'll never get control of your finances unless you learn to live below your means I keep in mind that were primarily talking about consumer debt here. Other kinds of debt. Perhaps for a business of mortgage or even education in moderation are in a separate class because they can actually lead to a greater financial return to consumer debt. On the other hand, results in a net loss because of the interest you have to pay. The solution is a spending plan that enables you to live on less than you earn so that you can actually save money for the future and that we call margin yeah well we can never get away from that one.

Okay, what's the what's the next misstep in our financial school of hard knocks today. Well it's the one that makes it difficult to stick to your spending plan.

And that's letting your fixed expenses get out of control, your monthly fixed obligations always make up the biggest part of your budget so you have to keep them in check. The biggest part of that of course is your mortgage that you can easily become house poor by taking on too big a mortgage that makes it difficult to meet your other obligations and to save you also have to watch your other fixed expenses were talking car loans, insurance, cable, and utilities. Let's go back to God's word. Proverbs 2120 there is precious treasure and oil in the dwelling of the wise, but the foolish man swallows it up. See, we have to be on constant lookout for ways to keep those fixed expenses as low as possible and of course her principles were talking about today including the first two that you've already mentioned, we've been teaching these things for 30+ years and that's because the Bible's been teaching these things for a couple thousand years. But during this time is when you really see these things come to the forefront and where those who are really struggling in many cases not always her own fault, but in many cases is because of the debt you're carrying, and that includes private people like ourselves or businesses like restaurants and JCPenney's right. That's exactly right.

You can violate God's principles and in good times, you may be able to get away with it for a while.

It really shows up in a challenging time with Karen right now it's right okay what will what's next.

What else you have for us all. Well the next lesson. Steve is buying something for emotional reasons. Usually this is what we call impulse buying. See you see something in the store. Let's say and think it will make your life better or give you a sense of happiness only to discover days after that you're no better off. First John 215 for all that is in the world the desires of the flesh and the desires of the eyes and pride and possessions is not from the father but is from the world. Now it's not wrong to enjoy the goodness of God's bounty. In fact, God's word affirms that idea. Just make sure that whatever you buy satisfies a real need or provides a lasting blessing and you keep God at the center of your life and that might be a good place to apply what I've heard you referred to as the 30 day rule. If you want something.

Maybe wait three or four weeks before you buy it by then you probably have forgotten about it, or you've seen something else you might want more or well I don't know, but it's probably a good rule for most of us most of the time are in a little bit of time left.

What's the next lesson you have forced you one more before the break, the maybe we'll finish it out after the name is buying something you simply can't afford. It's easy to know and that is because you'll probably use a credit card so a good rule of thumb is if you can't pay cash. Don't buy. I like that as well and we like the fact that you're with us today like talk to Rob about anything 557 did you know not to do with your money and I like to note ways to trim your budget amid the coming when you get those answers much more subsequent to the moneywise that will expert articles leaving subscription free money like the magazine moneywise. My door are friends and sound mind investing have been helping Christians reach their financial goals since 1990 with step-by-step guidance for investors. Just getting started making choices in a 401(k) or getting ready for retirement all grounded in God's word SMI slogan is financial wisdom for living well. More information is available online. Sound mind investing the SMI website also includes articles, and money management and investing sound mind investing.org hi I'm John Erickson Todd except God says no to your prayers. Maybe pray that your loved one will be healed or that finances would come in for a need for you to get accepted to a certain college all these things, God said no and that is hard to accept. But did you know that God also provides extra grace when he says no to your prayer request and seek to disgrace able to accept his answer ever. He always supplies for us because as first chapter fibers 20% is the one who calls you and he also will bring it to pass and applies to answers from God that are yes and ones that are no today.

If you are green goddess said no race to accept very difficult. And if that is robbing you of freedom and peace of mind. Christian credit counselors can help where a nationwide nonprofit counseling organization has helped over 3000 individuals in the last 27 years get out of credit card debt 80% faster while honoring that data and phone to learn how Christian credit counselors can help you visit Christian credit counselors.org Christian credit counselors not call 800-557-1985 today is more and taking us through the financial school of hard knocks. Many of you have already been there may be here in the middle of it. Hope you're coming out of it but we too have been through this financial school.

Some sometimes we've learned along the way. Other times, God's had us repeat some of these things but that's okay because then it really sticks just before the break we were talking about applying the 30 day rule and that's if you want something, wait a month before you buy it.

Maybe the price will come down. Maybe you will have forgotten about it. Or maybe you would've found a better deal and then you said Rob something about if you can't afford it.

If you have to use a credit card for maybe a good rule of thumb is if you can't pay cash just don't bite it all that's exactly right. You know we want to make sure we can buy things we actually afford it. If we don't have the money then we stop wait and save it all in. This is all really around this big idea.

We find throughout God's word around contentment Steve. It's really being content with God's provision. Am I willing to live with in the provision God is given me for right now and that's called contentment.

First Timothy six says it this way godliness with contentment is great gain. For we brought nothing into the world and we can take nothing out of it. One way to ensure that you do that is using what we call an all-cash or an envelope system to manage your spending. That's a great way to avoid using credit or debit cards. When the money in a particular category is gone. You have to stop spending, or re-account. Allocate the money from another category. Now, if you set it up electronically. You can still use your credit or debit card.

You just have to have a way to fund those envelopes and then allocate those transactions such that it will reduce the balances for those envelopes and actually Steve were working on the new moneywise app which will do just that. And so a preview of coming attractions work and have a solution for you in the very near future. Right cool. I like that. What was that recommendation stop wait and save not just not to be confused will stop drop and roll.

Stella something totally different. Totally different. Okay anything else. I don't do they still need to stop drop and roll. You know that was the thing back when we were in school, but yeah I have no that is been a couple of years yet say I one more lesson from the school of hard knocks and it is not recognizing your weaknesses, you know, it's often said that admitting you have a problem is the first step in solving it. In this really wraps up everything we've been talking about here that if you have a weakness of one of these areas admit it and take steps to correct it.

So, for example, do you stay up late watching infomercials are looking at things on the Internet like on Amazon or other place, and if so do yourself and turn off the tube or close your laptop and avoid that of overspending. I'm not necessarily putting the figures used in you know it takes a certain amount of humility to acknowledge that her pride doesn't want us to admit that we have a problem management managing money or there's a challenging area for us and of course the go back to Proverbs, King Solomon reminds us pride goes before destruction and a haughty spirit before a fall.

So be careful you never take your laptop to bed with you. Never take your take your laptop to bed with you.

Wrap don't take your laptop to Dell never looked over. It's 230 in the morning you think. How did I get here 800-525-7000.

Let's chat today. If you're having a financial issue question conundrum.

Let's attack those. The best way we can. Let's begin. Cruz Bay, Oregon hello Doug what's on your mind's or here. Stop, drop, and roll off. I drop my role and I look up and no man about my mortgage and car payment. Okay, okay, I have enough liquid funds to pay off right now. Talk to account five pulled money out of it would suck him down way the Lord not like you. It is winter, that's a good idea where all my I've been working towards this for 10 years to get.

And now that I've achieved the application start co-owner things started and I am working two months, but I have enough resources to last me actually quite a while. Okay I got it really blessed me.

Yeah, that's good to hear. Now if you were to do what you intended to do and that is pay off the truck and the home that would not be the case in terms of having ample resources to weather the storm. Is that correct. I would have a little more than important on but I know in my eyes way I budget you know I would not okay you say three months of payments RA I got that up to a year. Okay I like that. Well obviously you demonstrated Doug that you're willing to limit your lifestyle you had plenty of margin, which is surplus over and above your fixed and discretionary spending on a monthly basis such that you could build up that kind of reserve account and that's great and you had a real goal set out for that money which was to become completely debt-free. That's also great. I love that one of the reasons we want that reserve is in place in places four times just like this where something comes, that's unforeseen in your case, it was perhaps a temporary disruption in your your job situation and that's why we need those reserves and so I'm going to encourage you, especially given some of the uncertainty around your financial situation but even if you set I was still fully employed and really be hesitant about you paying down completely. Both of those accounts. Even though I love the idea of you becoming debt-free. So here's where I would go and I suspect you could pay off the truck. That's probably got the higher interest rate and still have at least six months reserves or more. Is that right yes yeah and what that's going to do is eliminate that monthly payment which is going to free up additional margin for you to stock back into additional savings will help. Tell me about your job situation. Are you actively looking for another job. I basically am a self-employed carpenter my work dried up buyer job right up the same day and I haven't done anything since then. But as the economy begins to function again as the social distancing Lord willing, begins to relax, as the cases come down and hopefully we move beyond this in the next few quarters.

I would expect you know your work would start to pick back up. So I think the safest thing you could do would be just to continue to make the minimum payments on both the mortgage and the truck and keep ample reserves there so you can weather the storm for as long as it might last and delighted to hear that you follow God's principles and you've got the ability to do that as soon as you get that next job. Perhaps that's the time to go and pay off the truck and again don't find a way to increase your lifestyle with that extra money were sending to the car payment go and put that back into savings, and then as things begin to get a little more stable and you have a stronger job prospect moving forward for additional work. I think that's the time to begin to start to chip away at this mortgage, perhaps not all at once, but maybe you set a goal over the next three years or five years to eradicate it but it's all going to be a function of making sure that you preserve enough liquid cash for you to be able to weather any kind of storm, at a minimum three months but in the situation you're describing. I prefer you don't go below six months so I think it's just gonna take a little bit longer than you expected, but I'm delighted to hear you follow these principles and that's what's got you in such a strong position today Doug, thank you very much for calling in today sounds like the Lord is blessing your obedience and your hard work. We appreciate your call. One more quick win, Noblesville, Indiana hello Rachel what's on your mind, job.

We have been working and we then hang down and I got into Philly for a year now. The first thing we get with half a car. My needs replacing a couple issues that we are still convening you that our original plan had been to wait until rain where most of our debt would be gone at that point to look for a car and then were wondering now with London rate being almost nonexistent or zero it better to slow down the debt reduction to save the money on a vehicle and look at that now, or if it back is still you know everything we can on the data and wait for next year, where it became more but have more time.

Still, in the current track. You are on Rachel, you were saving such that you could buy that car for cash next year.

Is that right now it would be making a payment that we would be out of our other any other that we had minor mortgages at that point though okay and what do you have student loans, credit cards, what is it you're working on right now we have currently a multivehicle Mike unit loan and I can't break so working on his small credit line and my daughter and got out very where thinking about another 12 month to be free out of that. Okay so you your driving in the existing car right now that you've got that's paid for in the you would be releasing that vehicle is a right right okay you know I'm getting. I mean, obviously, there are some great deals out there right now. Anytime we get into a recession like this one that was even brought on suddenly through the vents as opposed to real systemic problem or cyclical recession like we have generally every decade or so, historically, looking out the car companies will do things to try to spur on additional purchasing of new automobiles, but I don't see those deals. If you will going anywhere anytime soon. Plus, I'd rather you be able to take a rebate as opposed to the 0% financing option so I'm going encourage you to stay the course. I think you'll feel really good to get completely out of dad got a car that's paid for drive that until the wheels fall off and will be another great deal out there hear from. Do you know if you have enough money of house. Do you know how much is enough. If not, one blue can help with this book. Master your money a step-by-step plan for experiencing financial contentment.

Learn how to save and invest and give wisely create a long-term financial plan and how to get out of debt. Find it all in master your money by Ron blue available when you click the start button moneywise to work here is compelled by despairing to be compelled 2023 talk that being warned by despairing Jesus, and appearing right here in front talking about the same as the Holy Spirit dwells in Romans not been confirmed in the Holy Spirit where the Holy Spirit comes from inside something to I want you to hear another couple of examples on Paul's I want you to listen to a couple of examples regarding the apostle Peter listen to the first part of 12 quickly and I want to hear that the apostle Peter is talking, describing the experience that he had not stopped me to know you said this program//money and life run on the same track.

Unfortunately, sometimes it seems like your money is heading in a different direction from your goal, and never enough three keys to financial contentment. Author Ron blue helps you to break down all your financial options to a basic floor and then shows you how to keep it all chugging along in the right direction on the same track never enough three keys to financial contentment available when you click the store button moneywise live.org this you have love for one another and what better time to exercise that love that grace, that compassion with people you go to church real or even your neighbors that you may not know all that well. What better time to do something like that. Then right now this is moneywise where we do lots of money talk and G.

Speaking of money talk Rob was Segway resurface right away, sir doing it does involve talking Steve. Now bring the resources of the team is put together. It's absolutely free and I'd love for you to take advantage of it. It's called for money talks.

Everyone needs to have and it's available for you again as a free download. When you go to moneywise.org just click on resources.

You'll see if their number one. The very first one. Here's the idea.

You know, our view of money impacts her view of God. But not only that our relationship with money impacts our relationship with God and so often this whole area of money, especially as we think about it God's perspective it's just a daunting topic so much. So many times we just avoid the money conversation altogether because we don't know where to start when we try to really simplify that for you. We got four talks, one around the heart one around your financial health.

One around habits and one around financial hope, and in each one of them you take a quick little assessment and then we have some questions to ask. So whether you're pondering that yourself or your talking through with your spouse. I think this will be a great guy and easy way for you to explore this area of money for a biblical perspective. It's called for money talks. Everyone needs to have and you can go get it right now it moneywise live.org just click resource and what again was that list was that heart health and habits as are the manhole areas: health habits and hope okay and it's absolutely free.

So it will fit everyone's budget and check it out today when you visit moneywise.org or moneywise live.org Chicago, Illinois hello Ellen, thanks for holding and how can we help Ione Willis.

That's why I doubt that I fell on and sure how to find the right lender originally think that they shop around and find rate. I don't know what question I think they you really are closing your lender question yeah very good.

Well let me ask you just a couple quick questions just to make sure this doesn't make sense for you. It's just that you're just what year and 1/2 into your mortgage so we don't have to worry about you really increasing the length of the term of this mortgage significantly given that you're just fresh out of the gate. What is your current interest rate okay and that's for a 30 year mortgage yet okay and what is your credit score.

Today, roughly, do you know when I took out the loan. I like I like very experienced in financial thanks. I yeah okay well bottom line is you should be able to with a great credit score to raise your lower your interest rate by at least a point and 1/2 down to about 3 1/2%, which is where this really shy so I think the key right now is you start shopping this loan around that bank rate.com be a great place for you to look around and get to know the rates that are out there hope no one will talk. Investing is more than just returns.

It's an expression of who you are and what you value. When you invest your money reflect your identity as a Christian, and even tightly designed investments for performance and a better world so you can invest with the confidence to reach your financial goals while remaining true to your Christian values and commitments. We call this investing makes the world rejoice more is available best Eventide.com invest Eventide.com. Thank you from the bottom of my heart I could've had the procedure I needed without CHF's help sharing the bills that letter from a member displays Christian healthcare ministries purpose to glorify God and serve his people. CHF is the original noninsurance voluntary health filesharing ministry, enabling its members to share the cost of each other's medical bills, call 800-791-6225 or visit CH ministries or I went through many radium the Moody Bible Institute first of the week standing June 2021, building yourselves on your most training sounds waiting for the mercy 20 and 21, the Moody Bible Institute, like a season and our enemy the devil opens his and selects the most likely to attract as intended prey. Each life bite causes us to feel pain in your relationship miss out on God's intended purpose for my life is holding you back discover the power of the truth. Wisemen belief available the financial wealth you leave behind could be the best thing that ever happened to your loved ones or the worst, and splitting hairs, giving your money and things to your children without ruining their lives. Ron blue explains why it's important to make these decisions now, instead of forcing your heirs to do it later.

Splitting hairs will foster a real appreciation for the precious resources that God has entrusted to you, and it's available. Click the start button moneywise love I.org on the roster of California's relaxing sum of its reopening criteria that will help some counties that want to reopen faster than the state owner Gavin Newsom optimistic baseball could return by June. The World Health Organization bound calls for most of its member states to launch an independent evaluation.

How would manage the international response to the coronavirus which is been clouded by finger-pointing between US and China over cutting another 3000 jobs from its workforce. Its second major wave of layoffs in two weeks. The San Francisco company has cut 1/4 of its workforce since the year began eliminating 3700 people earlier this month. The stock market bounce back from its worst week in nearly 2 months.

Monday doubt, pushing past the 1000 mark to settle the day. 911 points higher at 24,597 NASDAQ added 220 points. This is SRN news five and got me 800-525-7000 is our number coming up someone wants to know about to moving what's it like if you're going to be moving to somewhere that's more expensive down in Fort Myers. Gentleman wants to know about an exit plan that he's been offered for early retirement will get to both those calls. But first, it's birth and how can we help you right now like to have my photo why and I waited in line at radio likely to know what it basically for me. Can I put it to be that I can't take it out shirts. Well, I think the key here is the distinction Bertha between pulling the money out of the IRA taking a withdrawal versus changing the investments inside the 401(k).

I'd rather you leave the money in the 401(k) or roll it to an IRA, an individual retirement account. The benefit of his you're not going to create a taxable event you're going to keep it in the tax-deferred vehicle and then you'll only pay the tax on it. As you take withdrawals when you need the money. Let's say you're going to convert this to an income stream and start drawing a certain amount each month will then you'd realize that is a taxable event.

Over the course of the year and then you pay the taxes on it based on how much you take out, but you can decide where to put the money you could put it in a money market if you want a CD or you could have a mix of stocks and bonds, but I don't want you to withdrawal it and create a taxable event without understanding that you follow what I'm saying on that piece of it now.

I can't wait to show that is true yes and you have the ability to pay the so you miss the 10% penalty, which would only apply to somebody who's under 59 1/2. Are you over 59 1/2 digits at 66 or 5666 okay so you wouldn't have a penalty.

Anyway, you'd be able to pull that money out without a penalty, but you still at the pay the tax. Another thing that's different this year with coronavirus is you can spread that tax over three tax years and not pay it all at once, but the key is we got identify what your goal is do you actually need this money to live on okay alright so this is money that's just going to continue to grow because you've got other resources. Social Security and other income that's covering your bills is that right right okay so Bertha, there's really no reason for you to pull the money out of the 401(k) or the IRA. If you roll into an IRA, you can still move it out of the stock market.

Now here's the thing though, if you were in stocks before coronavirus head you ridden the market down. You wrote it down significantly. At first it's already come back quite a bit almost 20% from the lows and I believe it'll move to higher ground. The question is, as it recovers. What is the right mix of stocks and bonds that fit your goals and objectives doesn't allow you to take any unnecessary risk and allows you to still have some growth in this account so that when you need it. Down the road or when you give it away or when you pass it on to your heirs. You've been a wide steward of God's resources. If you don't mind me asking Bertha how much is in this account. 50,000 okay and what was it before coronavirus and how much is it declined 40 so it was 40 before, but you said it's roughly 50 now and understand the correct how okay so how did it increase well I Might get like yeah that I get icy okay. Well, I think the key here is to perhaps find somebody who can help you take a look at the best way to invest this.

Looking at your overall financial picture. So we encourage you to do this, go to moneywise. I.org you'll find here the top something that says find a CK that stands for certified kingdom advisor putting your ZIP Code there and connect with a certified kingdom advisor who can do a quick financial plan for you. Looking at your income and expenses, the assets that you have including this 401(k) and perhaps give you some suggestions on how to invest this in a way that matches your goals and doesn't take unnecessary risks. I think that your next step, but I wouldn't withdraw this money even though you can spread the tax out because you don't need it and there's no reason for you to create this tax liability unnecessarily so hopefully that's helpful to you. We certainly appreciate your call today. Thank you, Bertha. We do appreciate that skill right back to our phone lines Milford Indiana Sharon you're on moneywise life. Thank you for taking my call.

I will advisor it in about a year and I will be moving our house paid for and it's roughly probably worth around 200,000. However, where we will be moving to where our kids and grandkids are in. How could probably be about 400,000 so my question is we have money invested in low risk and are financial and I just said it would be better to take on Lori Teachout for whatever else you know we have to pay on the house and take money out of our investment because our investments get Wesley investments in. He called back today and back at me.

Basically, you know, there faith line get set out for another one gets about 68%. So rather than taking out money from higher interest. It would be better to do a mortgage that has a lower interest rate is that your opinion as well.

Not necessarily.

Sharon you know I think there's a couple sides of this, there is the financial side of that which is just cranking through the numbers and seeing what makes the most sense on paper because that is one factor and then there's the convictions, you know, with regard to, do we want to take on debt this stage in our lives and would we have more peace of mind mind knowing that we own our home and do we have the cash to do it. Meaning do we know what season of life, Erwin, and if were retired, which it sounds like you all either are or will be when you make this move. Do you have the income you need to sustain your lifestyle even if you were to pull out.

You know the amount equal to what you have to spend over and above the proceeds of your existing home sale so help me with that. Do you if you were to pull enough out to buy it for cash. Would you have enough to still cover your bills on a monthly basis. So are you living on either of these bucket your bucket be come so this is money. This just getting their growing and growing from 48 yeah and we don't have never had never ever allowed. Okay, let's do this and ask you to hold the line to take a quick break when we come back I'll give you my thoughts on where you live/please certain times and Michael's new book financial help. Instead, it just a short assessment will show you where you are now long before ages financial wisdom and action plan in writing to transform right now. Request financial support, moneywise life the gift of $25 moneywise line.org I'm here to help you understand God's purpose for you like the eyes of a layman. The truth is always have as much of God as we want were finite and God is limited by time and space, and energy and brain function. God has the unlimited capacity, fill all spaces overflowing with his holy presence. But it doesn't go over is not invited this if an attic is closer to God you how many times have I been suspect is… For God and the later find myself wanting to have what they have.

After discovery that their lives are filled with God more than mine. Is this how we should all be living our lives.

Let your light so shine before men, that they might see God you want what you have. Your job is to guide revival outside the walls of your church by moving everyone here with today closer to Jesus you want to know how easy that is go tomorrow. TW.com is the Sunday morning service were approaching the crucial point one person in the congregation is just holding on. Let's take a look inside his subconscious captain.

We just can't take anymore as many banks have completely one night attention span is shot can only give you half impulse Bella Scotty. We need more power. The sermon lasts for another 20 minutes. I'm sorry Capt. I'm doing all I can just to maintain his life support systems is the Bible too much for your memory banks. God wants you to understand his word wrote it down. The Bible contains the key to eternal life to spend time in God's word and tell others about the only way the truth and the life of Jesus Christ.

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Let's hope not sure will great okay super Rob where we were chatting we share everything we have any recap here. So Sharon is feeling the tug you know all too well Stephen, that is to be close to your grandchildren and set in her husband about a year from now or to sell their home valued at about 200,000 which they owe free and clear. Congratulations and there to move somewhere where real estate prices are a little higher there to spend about 400,000 Sharon you've got resources. You said some of them are more conservative earning about 4% portion of your resources have been averaging 6 to 8% and you're wondering do you want to take on a mortgage at the recommendation of your financial advisor or pull this money out to cash. You said something that was really important. Right before we went to the break Sharon that was you all haven't had any debt in a long time, so I suspect you all really have a conviction around this and you and your husband would much prefer to continue to be debt-free, even if it meant pulling out of these accounts is that right when you think okay that you are making more money why you need the money in American pilot born that and take a mortgage and I we should be able to get our credit scores like I never have.

Well yeah you be putting down 200,000 to your 50% equity out of the gates. You're exactly right me from a purely financial perspective, it would make sense for you to go and take on a mortgage. I'd probably not get more than 10 or 20 year mortgage. It's gonna be a little higher payment.

But the goal is to become debt free and then you let that money grow. Now there's another side of this, the just says would we rather be debt-free, even if that means we have to sacrifice a little bit a return and then continue to put money aside because now her lifestyle is lower because we don't have a mortgage and that money could be invested but will know we own our home free and clear, and that's the piece that often gets discounted in these conversations and so I just want you to pray through first separately and then come together and talk about whether or not you all are comfortable at this stage your life taking on a mortgage. Now you could pay this mortgage off by selling this property at any time because you got 50% equity. Obviously, the value of this home is can be far greater than the value of this mortgage and you have the historical returns to say that were going to do better over time.

If we leave the rest of this money invested. It's going to continue to grow its can outpace the rate of the cost of the borrowed funds in the mortgage of roughly should Billy get that done even below 3 1/2%.

If you take a 20 year mortgage. Maybe even in the twos so I'm okay with that as long as you all pray through that talk through it and you're comfortable taking it on. But the moment one of you says, you know what we just want to stay debt-free. I wouldn't think twice about you pulling the money out and and just buying the house for cash. If you're comfortable with that, though then I'd say take on the mortgage. One other option, though we just throw this out there is you go, middle-of-the-road, and you say were going to take the money out of the 4% bucket and working to pay down what would be that $200,000 mortgage to let's say 100,000 and have a smaller mortgage and then leave a portion of it to grow. That's up to you guys but I think you can't really go wrong here as long as you think through this, beyond just the financial into really the spiritual side of it as well Rob it sounds to me like you're saying personally.

You wouldn't mind giving up 1/2 to 1%. This particularly in their stage of life to become debt free because the Bible speaks so often and so highly about being debt-free and how it should be a real, a preeminent goal in our lives that are accurate assessment. I think that's exactly right. And that's where this really does become a spiritual issue. You know we talk about this being God's money.

Does that mean we can't borrow no borrowing is not a sin, but there are clear warning so I think that's where so often we make the decision purely based on the financial and we leave out our values and our priorities and perhaps what God might be speaking to us as we pray through it and that's where Steve yeah the trade-off is real and I would always encourage it. If you feel a strong, leading, or conviction toward being completely we had Steve on the line we lost him. Unfortunately Steve if you're listening and you want to call back will do our best to get you on the year. In the meantime, Cleveland, Ohio. Lisa what you question for Rob.

I will will blind number like knowing all know I wait on the ranch right now we don't know what sure you have the ability Lisa to bring them in with you where it's your home and perhaps their coming in to live as opposed to you moving into their home where you will have the ability to control where you live in what lifestyle you're living but you are really exercising this opportunity responsibility if you will to care for parents that are really difficult spot at 1.11410 yeah, well, obviously. The purpose of the durable power of attorney is to really care for someone after the principal's incapacitation, and that may be the situation were talking about here where they're unable to make their own decisions.

It's a difficult situation.

Certainly, it's not going to be without its challenges, but if someone is incapable of handling their own affairs. That's where you know you would be able to step in. Through the power of attorney and be able to make decisions on their behalf for their in their best interest. What about your dad, though, is he able to make sound decisions at this point. Okay will help you get a couple of things here.

Do you will have a good godly estate planning attorney that you know about. Perhaps the person that drew this or somebody that you could get some legal counsel from to help navigate the situation because is really two professionals that I think would be really key here and I really prefer the both of them are folks that know the Lord and and really understand the God's word somebody would be the first one would be an estate planning attorney who really understands kind of the legal side of this. What instruments are in place, who is been granted what authority and one of the triggers for those in the other pieces just purely the financial peace somebody to counsel you through kind of what is the state of their situation financially, what you have the capacity to do financially without really jeopardizing your own financial foundation and how do we allow these two things to work together both the legal side of you all caring or you particularly caring for your parents in making decisions where necessary and your financial means to do so, and in the midst of that is really a path forward that says you know, depending on how bad this is. Here's the decisions were going to need to make and I'm going to need to step in and make it I can do that legally and here's how we can handle this financially in terms of what home were going to buy and where they're going to live and to the best of your ability. The decisions that need to be made on their behalf so they don't really put themselves in an even more desperate financial situation.

If you want to go to our website moneywise live.org. Click on find the CK I'd start there.

There some wonderful godly men and women certify kingdom advisors in Cleveland that I know would love to come alongside you and help you think through the financial side, and any one of them would be able to recommend a godly estate planning attorney there in Cleveland and the two could work together with you to help you sort this out legally and financially. I think that's the starting point Bay that all in prayer and then give us a call back and let us know as you make some of these decisions because I'd love to hear how this turns out. But that be the next place I would go always Lisa. We appreciate your phone call today and we will pray that God gives you all real direction and wisdom and grace as you work through this and your husband selling very generous people. Thank you very much and thank you for listening today.

Moneywise, lives a partnership between Moody radio and moneywise medium my thanks to Judy, Clara, Courtney and Jim for their technical expertise for Rob last time Steve Moore Drive safely season here elbow and then join us again tomorrow


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