November 20, 2025 • 42 mins
We often hear about bull and bear markets, but those trends actually come in two forms—cyclical and secular. Understanding the difference can help you invest with patience, discipline, and faith to make wise long-term decisions. On the next Faith & Finance Live, Mark Biller joins Rob West to unpack these market cycles and discuss why they matter. Then, it’s your calls. That’s Faith & Finance Live, where biblical wisdom meets today’s finances, weekdays at 4pm Eastern/3pm Central on Moody Radio.
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Episode Transcript
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S1 (00:08):
Markets rise and fall, but not all cycles tell the
same story. So what do those ups and downs really
mean for your investments? Hi, I'm Rob West. We often
hear about bull and bear markets, but those trends actually
come in two forms cyclical and secular. Understanding the difference
can help you make wiser, long term decisions with your portfolio.
(00:30):
Mark Behler joins us today to unpack these market cycles
and why they matter. And then we'll take your phone
calls at 800 525 7000. This is faith and finance live.
Biblical wisdom for your financial decisions. Well, we're so glad
to have Mark Behler with us today. Mark's our good friend.
He's executive editor at Sound Mind Investing, and he's our
(00:53):
go to guy when it comes to the markets, the economy,
your portfolio and specifically related to that topic. We'd love
to hear from you today. Mark will stick around for
the entire broadcast, so that means we will prioritize those
questions around the market. Perhaps you're wondering how to think
about your investment strategy here with this market up? Uh,
(01:14):
although we've been selling off as of late, uh, you know,
the market's been really strong this year, perhaps far more
than anyone expected. What does that mean for you? If
you're approaching retirement, what's the right mix of investments? What
do you do with gold here, given the incredible run
up that we've had? Any of those questions in play today,
when you call 800 525 7000, again, that's 800 525 7000.
(01:38):
We're talking today about cyclical and secular bull and bear markets.
We'll define that here in just a moment. But first Mark,
great to have you with us.
S2 (01:47):
Thanks, Rob. Great to be back.
S1 (01:50):
Mark, uh, this is a great article you wrote for
the Sound of Mine Investing newsletter. It was titled Bulls
and Bears Cyclical and Secular. And by the way, folks,
if you want to read it for yourself, head over
to Sound Mind Investing. Why don't we start with the basics, Mark?
People often hear about bull and bear markets. There's one
of those bulls sitting right out in front of the
New York Stock Exchange. So what do those terms really mean?
S2 (02:14):
Yeah. Well, Rob, you know, sometimes the articles that we
write for our online investing members, a lot of it
really is trying to help them understand and make sense
of all of the things that they hear in the
financial media. And otherwise. We hear these these kind of
jargon words thrown around, and people don't always know exactly
what they mean. So that was part of the deal
(02:36):
with this article. Um, and, you know, before we even
get to those definitions, you know, I think it's worth
pointing out that cycles are all around us in creation.
We see them everywhere. Um, we've we see them in Scripture.
Solomon wrote way back in Ecclesiastes to everything. There's a
season and a time to every purpose under heaven. You know,
(02:58):
looking around the natural world, we see the sun and
the moon and its cycles, the tides, the seasons and
so on. And financial markets go through their own sets
of cycles as well. They're less predictable than the natural world.
But the two most basic cycles are the the bull
and the bear cycles. And all we're talking about there, Rob,
(03:20):
is bull markets are when prices and markets are heading
up heading higher and bear markets are when they're heading lower.
S1 (03:31):
Yeah. Well it's really important to understand because these are
big ideas. But we can get a little more specific
because inside those bull and bear markets are something called
cyclical and secular markets. And this article we're touching on
today explores the differences. So go ahead and unpack those
terms for us.
S2 (03:51):
Yeah sure. Those are really just fancy words. fancy finance
terms for a very simple idea, and that is that
these market cycles come in two varieties. You have the
shorter term cycles, which we call cyclical short term. And
then we have these longer term cycles which we call
secular cycles. Where this can get a little bit confusing
(04:14):
is that sometimes they'll overlap. So you can have a
secular cycle, um, say um, the bond market, the US
bond market was in a secular bull market for 40 years,
from 1982 until Covid in 2020. So that's a secular
move where interest rates were generally falling through that whole time.
(04:37):
But within that secular move, you have lots of these
little cyclical moves where the interest rates might go up
for six months to a year inside of a secular
move where they were heading in the other direction. So
it's just really short term and long term cycles.
S1 (04:55):
Interesting. All right. Well we're going to talk about what
that means for the average investor. Those who are listening
to the broadcast today how they might learn from that perhaps.
What are some of the examples of what you just
described that we can see in history. And we'll be
taking your questions as well. Marc Biller here. Now's the
time to call. Go ahead and get in the queue
(05:16):
with your investing related questions today. We'd love to hear
from you. The number 800 525 7000. More with Marc
Biller right after this. Stay with us.
S3 (05:33):
The opinions offered during this program represent the personal or
professional opinions of the participants, given for informational purposes only.
Any information provided is not intended to replace advice from
a financial, medical, legal, or other professional who understands your
specific Situation.
S1 (05:57):
Great to have you with us today on Faith and
finance live. I'm Rob West, Mark Biller here today. We're
taking your calls and questions, uh, talking about cyclical and
secular bear and bull markets and what that means for you.
Before the break, Mark was explaining to us what these
terms mean bull and bear market, cyclical and secular. And Mark,
perhaps it would help just to have an example of
(06:20):
how these shorter cyclical trends fit within the broader secular trends.
S2 (06:25):
Yeah, sure. Well, let's look at the stock market for
a good example from 1968 to 1982. So that was
a 15 year period. The S&P 500 index was flat.
So what I mean by that is it was the
same value in 1982 that it had started at 15
years earlier. Um, that's kind of shocking. 15 years of
(06:48):
no gains. but in reality, it was actually a little
worse than that because we had such high inflation that
people actually lost a lot of purchasing power during that time.
At any rate, for our purposes here, that was a
secular bear market in stocks, 15 years of a flat market.
But within that, there were several really sharp gains and
(07:11):
losses in the stock market. Those were little cyclical bull
and bear markets that were happening within this longer term
secular trend.
S1 (07:22):
Interesting. Yeah, that helps to put a finer point on it.
As we think about where this has happened in the past,
by the way, we will be taking your calls and
questions here in just a moment. So if you have
a question for Mark Biller today, something on the markets,
the economy, your portfolio, call right now 800 525 7000.
That's 800 525 7000. Mark, let's take this down to
(07:47):
make it practical to those listening today. Why? Why does
it matter for everyday investors to know whether we're in
one of these cyclical or secular trends?
S2 (07:56):
Yeah, that's a great question. And honestly, Rob, it's probably
more helpful in terms of the bond market than the
stock market for a couple of reasons. One is stocks
move so much more than bonds do that whether it's
a cyclical move or a secular move. If stocks are
going to move 30, 40, 50% in one direction, we
don't really care what type of move it is. That's
(08:18):
a big move, and we're going to pay attention to
that regardless. With bonds, it's not usually that way. The
gains and losses tend to be much more incremental. And
the other thing about the bond market is you do
see historically these much longer, more pronounced one way moves.
(08:38):
So I mentioned earlier the 40 year bull market from
1980 82 until Covid in 2020. Well, that hasn't really
been that unusual for the bond market. And so if
especially today, where we may have had a shift around
Covid from a long trend of lower interest rates, which
(09:00):
is good for bonds, it increases bond returns to a
shift since Covid, where rates have been rising, which is
a headwind for bond investors. Well, if these tend to
last ten, 20, 30, 40 years at a time, we
should definitely pay attention to that. And bonds really are
a great area right now to focus on for this
(09:22):
idea of of secular versus cyclical moves, because as I
was just saying, we kind of had a turn during
Covid where interest rates started going higher. Um, after 40
years of really good bond returns, the last five and
a half years have been pretty poor for bond investors.
In fact, um, a lot of investors would probably be
(09:45):
surprised to realize that the main U.S. bond index is
negative over the last five years. Um, and so that,
you know, that is, um, if you're if you're looking
at a longer term picture, you would say, well, with
interest rates rising, I don't want to own any bonds,
but that's not necessarily the right takeaway, because if we
(10:06):
look closer and short term, I should say we've had
a cyclical move here in 2025 where bonds have actually
done pretty well. And with stocks kind of wobbling a
little bit, as you alluded to earlier, you know, bonds
aren't a bad place to be right now. So I
don't want people to hear this and come away with
(10:28):
the idea that we should sell all our bonds. It's
just this idea that even within a longer trend that
may have started back in Covid in 2020, um, you
can have these little moves still where it makes sense
to own an asset. Where we're really trying to focus
is for the longer term, how do we want to
(10:50):
set up our portfolios over the longer term in light
of these cycles?
S1 (10:55):
Yeah, that's really helpful. All right. So somebody who's listening
today that's a long term investor. How do these ideas
then shape how they build their portfolio.
S2 (11:04):
Yeah. And to be clear I'm definitely not trying to
get people to go out and change their long term
plans dramatically here. But sticking with this idea with the
bond market, you know, for the last 45 years, investors
basically have been told you can allocate a huge amount
of your portfolio to bonds. They're safe. You're going to
(11:26):
earn good returns. They're going to go up when stocks
go down. And so as a result, a lot of
our industry as you well know, Rob, is kind of
centered on this idea of, you know, a 60 over
40 or a 50 over 50 stock bond portfolio, and
you don't need a whole lot else. Well, if this
is a new secular bear market in bonds, we may
(11:48):
not want to rely on bonds for as large a
portion of our portfolios going forward as we have over
the last 3 or 4 decades.
S1 (11:58):
Hmm. Yeah. So, you know, how does that work itself out, uh,
in your portfolios? Uh, as you all are building these
for your investors.
S2 (12:08):
Yeah. So we've we've kind of had our eye on
this for a while. Rob. And we were a little
bit early. Uh, and to be honest. But it is
kind of playing out the way we expected it eventually would.
And what we've done to prepare for that and in
response to that is we've tried to come up with
strategies that are less, um, dialed into large static portfolio allocations,
(12:36):
like I was saying. Instead of being a 60, 40, uh,
investor portfolio with 40% in bonds no matter what. We
have strategies one called dynamic asset allocation, where the name
kind of gives away what we're doing, where we're altering
those allocations depending on the market cycles and conditions. Um,
(12:57):
earlier this year, we we helped launch an ETF that
diversifies across 20 different assets. Um, and a big part
of that is just this idea that if we've entered
into a bond bear market, we need to look at
some different assets for exposure to try to build a
(13:19):
safety net within the portfolio that bonds used to fill
that need completely. And we're still using bonds, but we
want to add some other things to get other types
of diversification as well.
S1 (13:31):
Interesting. Well, we'll, uh, we'll get you to share a
few of those other things that you're using alongside bonds,
especially given your outlook for bonds. Uh, when we come back,
we'll also be taking your phone calls as well. Now's
a great time to call. We've got some lines open.
Mark Billers here today. We're talking investing the markets and
your portfolio. So there's something you want to check with
(13:54):
Mark on. Go ahead and call right now. Here's the
number 800 525 7000. We'll begin diving into those market
and portfolio related questions after this break. 800 525 7000.
If you want to check out this article, you'll find
it at Sound Mind Investing. Org. It's titled Bulls and
Bears Cyclical and Secular. Mark Biller here today back with
(14:18):
much more just around the corner. Stay with us. Great
to have you with us today on Faith and finance Live.
We're talking cyclical and secular bull and bear markets today.
Market trends and how they affect your portfolio. Mark Millar's here. Today.
(14:42):
We're unpacking the article he wrote for the Sound Mind
Investing newsletter. You'll find it at Sound Mind Investing. Org
just look for bulls and bears, cyclical and secular. We
want to take some of your calls and questions as
well today. Prioritizing those questions around the market and building portfolios.
Let's head to the phones right now Maria is joining
(15:03):
us from Florida. Maria go ahead.
S4 (15:06):
Hi. Yes, I was saying that I do have a
CD right now and it's maturing now in December, and
I'm looking to see where I can find better options
for myself. Who can I call for CD 30 35,000?
S1 (15:22):
Sure. Yeah. You know, it always comes down, Maria, to
the purpose of the money. And that purpose often drives
what's called the time horizon. And that's just simply how
long before you need access to the money. Uh, you know,
we'll start typically with what we call an emergency fund.
And by definition, an emergency fund is money you need
(15:43):
in an emergency on a moment's notice. So you've got
to keep it liquid and safe. So that's why we
normally talk about a savings account, paying a nice interest
rate or a money market account. And then if we
have a year's time, we may say, okay, we can
move beyond savings and maybe look at a CD. Um,
and then if we have, let's say more than five years,
(16:04):
we may want to, you know, introduce some stocks, maybe
between 1 and 5 years. We could talk about a
bond mutual fund. So talk to me for a second
just about the purpose of this money and how safe
you want it to be.
S4 (16:19):
Okay. I don't need it right away. I do have
emergency funds. Um, I'm looking to see maybe to maybe
1 or 2 years that I don't need it.
S1 (16:32):
Okay. Very good. Excellent. Mark 1 to 2 years on $35,000.
What thoughts do you have?
S2 (16:39):
Yeah. You know, I think that with with that kind
of a time frame, you are looking at, you know,
a CD, a good, uh, either high yield savings account,
you could get into bond funds, but that generally is
is going to be introducing a little bit more complexity. Um,
which is fine if you want to do that or
(17:00):
if you already have a brokerage account. That makes it
very easy. But I don't know if I would go
out and do that, you know, just for this in
this case, if you don't already have that set up,
I guess 11. that I would make is if you
are going to go the CD route or if you're
comparing it with high yield savings accounts, you know, we
(17:21):
we have recently entered into a interest rate cutting cycle
where the Federal Reserve has started lowering interest rates. and
most investors expect that they will continue to lower interest
rates throughout 2026. And what that tends to do when
(17:43):
the fed is lowering those short term rates is it
does bring the yields down on savings products like CDs
and like high yield money markets and that sort of thing.
So if you are looking at a CD, um, it
might be a time to, to push that maturity a
little bit longer, like getting a one year CD instead
(18:06):
of a six month CD or something like that, to
try to lock in today's higher rates instead of likely
getting lower rates as we move into 2026. So that
would be my my one little insight there. Rob, what
else would you suggest?
S1 (18:23):
No, I think you're right on. So I think the
place to go Maria, if you want to shop these
rates and find out who has the best CD rates
or the best savings accounts rates you could go if
you're comfortable on the web. Bankrate.com bank rate and then
click High-yield savings click CDs every day they update it
with the the banks that have the best rates. You're
(18:45):
going to look for something FDIC insured. And, um, you know,
you'll look for something that's 4 to 5 star rated.
So you could also, if you want to look somebody
in the eye, go into a local bank or credit union,
you just may not get, you know, as much as
you'd get if you were willing to use an online
bank just as safe. Um, but you are, you know,
(19:06):
typically going to have to do business online to get
the very best rates. Maria, thanks for your call today,
Indiana grant. Go ahead.
S5 (19:14):
Yeah. Thank you. Uh, we're looking at possibly retiring in
2 to 3 years. We've got some funds available for
multiple purposes. Uh, what kind of dollar amount would be
or percentage amount would be feasible to do a bonds
or CDs?
S1 (19:32):
Yeah. Mark.
S2 (19:34):
Yeah. So, you know a good rule of thumb, Grant.
You know, that's been around for a long time is, um,
you know, taking your I guess there are a few
different ones. Rob probably knows a few, too. But the
idea of of reducing, uh, you know, start with 100,
reduce your age, and that will give you your bond allocation.
(19:54):
Those are very, very broad brush type ideas. Um, you know,
like I've been saying here earlier, um, we're in the
process of kind of rethinking some of those rules of
thumb and whether, um, investors should have as much allocated
to bonds as they have in the past. Um, and
(20:15):
so we have a couple of, uh, approaches at Sunlight
Investing that have us, you know, someone who in the
past might have allocated 40% of their portfolio to bonds.
They might be at 30% now with a mix of
some other assets within some strategies that we have. Um,
also some strategies that will move the bond allocation up
(20:38):
and down, uh, and treat the bonds a little bit
more like you might treat an umbrella. I mean, I
don't know about you, but when I wake up in
the morning, I don't automatically go outside with my umbrella open.
But if it's raining hard, I definitely want to have
it open on those days. And that's kind of how
we treat some of these allocations. You know, there are
(21:00):
certain times in the cycle where we want to have more,
other times in the cycle where we want to have less.
So that that gives you a general idea. But, you know,
for folks kind of hitting retirement age, typically somewhere in
that 40 to 60% is usually pretty pretty reasonable.
S1 (21:20):
Yeah, I think that's exactly right. Whether you use 110
minus your age, because people are living longer or 100
minus your age. I mean, at 65, you know, you're
talking somewhere between, uh, you know, 45 and 35% in
the bond category or bond equivalent, as Mark said, maybe
a rounded out with a portion of that in gold
(21:41):
or Bitcoin or something like that, a small portion. Uh,
and then the balance in stocks recognizing you still have
a long time horizon even when you hit retirement. Thanks
for your call back with Mark after this. Stay with us.
(22:02):
Thanks for joining us today on Faith and Finance Live.
Mark Biller is here today. He's executive editor at Sound
Mind Investing, a long time underwriter of this program. And, uh,
Sound Mind has been a great friend going all the
way back to Larry Burkett and their founder, Austin Pryor,
who were good friends and partners in ministry. And we
enjoy a great relationship that continues to this day. Mark's
(22:23):
a regular contributor here. If you want to learn more
about sound mind investing, go to Sound Mind Investing. Mark,
before we head back to the phones you were talking about, just,
you know, the short term outlook for bonds is probably
pretty good as rates head down. But perhaps as we
look out five years plus, maybe not so much. I
know you all have some strategies where you're taking that
(22:44):
bond portion of the portfolio and adding some other things
into that to round it out. Perhaps that might do
a little better over the next five plus years. Give
us a sense of what types of things you're using there.
S2 (22:57):
Yeah, sure. You know, I think it's it's probably healthy
to to unpack. Why have bonds been struggling? I think
that may help people to kind of connect the dots. And,
and a lot of this is that we've been in
a higher inflation environment. You know, we've had close to
five years that we've had monthly inflation prints that have
(23:21):
been higher than the Fed's 2% annualized target. So it's
been almost 16 months since we had a reading that
was below 2%. So in that in a higher inflation environment, um,
what we're looking for are things that are going to
hold their value in that type of inflationary environment. So
(23:43):
as we we think about those sorts of things and also,
you know, the the factor that we've talked about in
recent programs, Rob, where the the government's response to every
crisis seems to be to stimulate more print, more money
to base the currency. You have these twin forces of
(24:04):
inflation and currency debasement. And so a lot of the
things that we've been adding to our portfolios are things
that directly address those two issues. And so a few
of those things would be gold. We've talked a lot
about that and how well gold has done. But gold
really kind of hits both of those. Inflation and currency
(24:26):
debasement areas. Another thing that we've been writing about and
have added to our portfolios in the last five years
is some commodity exposure. Um, we didn't have that until 2020.
We didn't really feel like we needed it, but it
fills a different niche now. Um, real estate has historically
(24:47):
been a good inflation fighter. It's a little bit of
a mixed bag because real estate sometimes doesn't respond well
to higher interest rates. Um, but you and I have
discussed the pros and cons of a small bitcoin allocation. Um,
we've been seeing the last month or two how volatile
bitcoin can be. So all of those warnings about keeping
(25:09):
your sizing very small on bitcoin certainly appropriate. We're getting
a good illustration of that right now. Um, you know
in September Morgan Stanley's chief investment officer, created a lot
of waves in the investment business when he suggested that
the traditional 60 over 40 stock bond portfolio should be
(25:30):
adjusted to 60% stocks, 20% bonds and 20% gold. That
was like a bombshell going off across the industry. And
to be quite honest, Rob, as much as I like
gold and I really do, even I'm a little bit
uneasy with the idea of 20% of the portfolio in gold.
(25:52):
But that said, if you take that idea of going
to like 60 stock, 20 bonds and 20 something else,
where maybe 10% of that is gold and the other
ten is a blend of commodities, real estate, energy stocks,
a little bit of Bitcoin. You know, some diversifiers like that.
(26:13):
That type of an approach really makes a lot of
sense to me.
S1 (26:17):
Interesting. Well, of course folks can do this themselves, but
you all have made it easy. Whether it's through the
dynamic asset allocation in the Sound Mind Investing newsletter or
even some more accessible products like an ETF. Right.
S2 (26:32):
Yeah, we we started helped launch an ETF earlier this
year that does some of this dynamic position sizing across
20 different asset classes. And so that makes it really
easy for people to just buy one thing, hold that
one ETF and know that this type of adjusting is
(26:53):
going on automatically within that wrapper. So that makes it
really easy for folks.
S1 (26:59):
Excellent. Check it out at Sound Mind investing.org. All right.
Let's get to as many calls as we can here.
Speaking of gold, Mimi wants to talk about perhaps whether
this is the time to buy gold for her portfolio. Mimi.
Go ahead.
S6 (27:13):
Yes. That's right. So good afternoon. Thank you for taking
my call. Sure. So I was looking at the website
for gold. I guess they got my name and then
they started calling me to sell gold. So I don't know,
how do you buy gold? Is it? So I asked them.
So I want to ask you now, do you buy
gold like they were selling it per ounce? I said,
(27:36):
but isn't that like a stocks that you can also
buy on the internet? I mean on, on for Schwab
or whatever. Um, platform. So how do you buy gold
and is it a good time to buy gold?
S1 (27:47):
Yeah. Great. Mark.
S2 (27:48):
Yeah, absolutely. Great question. So you do have to be
careful because there are a lot of people who want
to sell you gold. And like with a, with a
lot of these products, um, the best way to know
whether it's a good deal or a bad deal is
to go online and look at what the what's called
the spot price for gold. So if you just look
(28:10):
up the gold price online and see what it's trading at.
That will give you an idea of how much of
a premium any particular gold purchase is charging over that
spot price. And the goal, Mimi, is to to find
the the best option that's charging a low premium, the
(28:33):
lowest premium. Of course, you want to deal only with reputable,
trustworthy sources. I should throw that in too. But let
me give you a couple of examples here. So, um,
one place that people have started buying gold, um, a
lot of gold is actually Costco. And the reason Costco's
gold is so popular is because they have a very
(28:55):
small markup over that spot price, which makes it very appealing. Um,
this is this is where the internet can really help you,
because knowing what that spot price is, you could even
walk into a local coin shop, a gold shop in
your town or your city and see how much their
markup is and how that compares to different options where
(29:17):
you could buy gold online. The other main way Mimi
to buy gold. That's very easy. You mentioned having a
Schwab account is you can buy ETFs that invest directly
in gold. So there are multiple of those. Um, some
of the ticker symbols are GLD. There's another that's physical gold.
(29:40):
And you can buy those ETFs just like any other ETF.
And think of that as essentially going 100% into gold
without a markup without a premium. Now of course, what
you are sacrificing is you don't hold that gold in
your hand. So, you know, that is a financial product,
(30:01):
even though they are are buying gold, which is audited
in those ETFs. A lot of people do prefer to
own their own gold and have it in hand. But
those are the two main ways you can buy gold coins.
A one ounce US Eagle. Um, or you can go
online and buy the gold ETFs. Both are effective. There
(30:24):
are different pros and cons.
S1 (30:26):
Yeah. And if you're wanting just to add that gold
exposure to to your portfolio and not interested in kind
of keeping it and passing it down to the next generation,
I think that ETF makes it really attractive, Mimi, because
you don't have to worry about the dealer, the markup,
the security, all of that. You just buy like a
stock GLD or one of the others. Hope that helps.
(30:49):
Thanks for your call back with more after this break.
Stay with us. Great to have you with us today
on Faith and Finance Live. Mark Miller is here today.
He's executive editor at Sound Mind Investing, a longtime underwriter
of this program. If you want to learn more, just
go to Sound Mind Investing. We may have room for
(31:11):
one more phone call in addition to those holdings. So
if you've got an investing related question, call right now
800 525 7000. Let's go to Tennessee. Brian. Go ahead.
S7 (31:22):
Hey, thanks for taking my call. I'm a little rural,
so I hope you can. I hope I don't lose you. Um,
so I think you may have already answered my question
as it relates to your recommendation about bonds. So I'm 59,
you know, target date or target age, maybe 65 for retirement.
I'm pretty I'm pretty aggressive in all my 401 K portfolio. Um,
(31:44):
so based on what I heard you say, being 59
and you deduct my age from 100, that should mean
I would be 40% in bonds. Is that accurate?
S1 (31:53):
Yeah. Mark your thoughts.
S2 (31:58):
People have thought about this for for the last few decades, Brian.
And I think the two factors that we've been kind
of highlighting today, one, it may be appropriate to rethink
that just on the face of, uh, if bonds have
moved into a secular bear market, we may want to
look for some alternatives. Um, and then the other part
(32:20):
of that, too, is that people are living longer. And
so if you do retire at 65, um, you know, there's, uh,
an eye popping statistic I often will throw at people
that if a couple retire at 65 and good health,
the actuarial numbers suggest that there's a 5050 chance that one,
(32:43):
at least one of those two are going to live
to age 90. Well, that really does change things, because
if you retire at 65 and you have a 25
year time horizon, you don't necessarily have to go to
a super conservative posture with your investing on day one
of your retirement. You've got 25 years ahead. So those
(33:06):
are some things to think about. Some reasons why you may,
you know, be moving in the direction of a higher
bond allocation, but not feel a lot of pressure to
get there in a big hurry. Those are my thoughts. Rob,
how about you?
S1 (33:22):
Yeah. Totally agree. I mean, I think because of those realities,
Brian keeping a little bit more in stocks, maybe supplementing
that traditional bond portion of the portfolio with, you know,
a little bit of precious metals, as Mark said, maybe
some exposure to commodities, maybe even a small portion to Bitcoin,
I think, you know, could round that out. Keep that growing,
(33:45):
help you overcome this, you know, sticky inflation that we've
been dealing with and recognize. You know, time is on
your side. And so we still need to take a
decades long, you know, three decades or more approach, even
after you retire, to how long this money needs to last.
I think the other approach is to find an advisor
who can, you know, help to be a little more
(34:07):
strategic and dynamic like Mark's been talking about? Even the
team at Sound Mind investing.org could be helpful, but hopefully
those give you a few thoughts to think about as
you're considering. Um, you know, how conservative do you get
as you, uh, you know, head into those retirement years?
We appreciate your call. Uh, Mike is in Ohio. Mike.
Go ahead.
S8 (34:29):
Thank you for taking my call. I really love your show.
I just want to say that you are very popular
in the trucking industry. That's what. Hey, that's good for
a living.
S1 (34:38):
Excellent. I'll take it.
S8 (34:42):
So. So here's my question. I got a year and
a half ago, I retired at 63. I got north
of half a million, uh, in an investor. And I
also have a 401 K at work with about 150,000. Okay. So, uh,
with what I'll be drawing on Social Security. I need
some supplement that'll come from my investments. Yeah. Do I
(35:04):
roll it into an annuity? So I got a set
amount coming in each month. Or is there a way
to leave it in the market but still draw about
2000 and 2500 a month to supplement my Social Security?
S1 (35:20):
Yeah. And basically we're saying you've got about 650,000 between
the two accounts you could use to supplement that Social Security.
S8 (35:31):
That's correct. And I'm still working. So I got another
year and a half to add to that. Yes.
S1 (35:35):
Yeah. Great. I mean, so let's say it's up around 700,000.
I mean, I think the good news is, Mark, even
without an annuity, which is going to lock up the
money and create some complexity, you know, 650, 700,000 if
he needs 2000 a month. I mean, that seems very realistic, right?
S2 (35:52):
Yeah it does. And and Mike, this is exactly the
type of situation that many, many, many of our SMI
members and also our private client investors where we do
the investing for them, they're in this exact situation. So
this is very common. It's absolutely possible to do your
own investing and then just draw from those investments as
(36:18):
you go to get the income that you need. Um,
all you know, the advisors from Kingdom Advisors, that's what
they specialize in as well. Um, so getting a good
advisor to help you can can simplify that or, um,
you know, like I mentioned, our SMI members tackle this, uh,
type of situation all the time. It's really kind of the,
(36:41):
the focus, uh, building that nest egg and then working
on how to invest it and draw that down. Those
are major themes of our, uh, our newsletter. And we
help people do that all the time. So definitely be encouraged.
That's not to say you shouldn't do the annuity option,
but you certainly don't have to. There is definitely another path. Um,
(37:05):
and you know, like Rob and I often will mention,
the annuity path tends to be an expensive path. And
so if you're willing to do it yourself or work
with an advisor to do it, you can usually accomplish
those same goals with lower fees and more flexibility because
you're not locking that money up in the annuity. So
(37:26):
those are my my thoughts there. Yep.
S1 (37:29):
Yeah I think you're right on there. I mean, so
basically what we're saying is, you know, if you grow
that to 700,000, 4% a year, which is very realistic,
is 28,000, you know, that's 2300 a month, you're gonna
pay a little tax on it, probably. And maybe some
of your Social Security is taxable. Um, but if you
can continue to work, delay that Social Security as long
(37:50):
as you can, then you know, that is very realistic.
The nice thing is, if you have an advisor managing
managing it like a certified Kingdom Advisor or the team
at Sound Mind Investing. You know, you could transfer that
to them. They could manage it for you. You know,
keeping the risk minimal, uh, just to meet your income needs.
(38:11):
But you'd still have full access to the money. So
if you needed it for, you know, some long term
care for a period of time and you needed larger chunks,
you can get to it as opposed to the annuity,
where you're going to have more in the way of
lockup periods and that kind of thing. Now, at the
end of the day, if you say, listen, I just
don't want any market risk, I'd rather place that on
the insurance company. Well, that's where people will use annuities. But,
(38:36):
you know, if you can find an advisor who you
feel good about, you know, we kind of prefer just the,
the plain vanilla investing, keep full access to your money. And,
you know, I think it's just a better way to
go overall. Does that make sense?
S8 (38:51):
That makes a lot of sense. I actually have a
financial advisor investor that is a Christian man. He does
a great job. Now, one quick second question if I can.
He's earning me 14.5% over the last two years that
I since I've been with him. How long do you
think that's going to last?
S1 (39:10):
Yeah. I mean, it's a great question. We've just been
in a really unusual period where we've had just some
really phenomenal, uh, returns. Marc, do you feel like, you know,
we talked a lot about the bond market as you
look out over the next ten years, do you think
we need to be comfortable with, uh, more tempered annualized returns?
S2 (39:29):
Yeah, I think unfortunately, we probably do need to have
that expectation. History tends to history suggests that when we
start from the types of elevated stock valuations that we
have today, that the forward ten year returns tend to
be lower. So that is a reasonable expectation. Um, of
(39:51):
course it's always it's always different this time. Right. And
so it is hard to know. You never know. And
that's why we do try to focus on those extended
time periods, 5 to 10 years at a time. Because
in the short term, anything can happen with the stock market.
S1 (40:08):
Yeah. Hey, I really appreciate you being on the program today, Mike.
Thanks for your kind remarks about the program. I hope
that was helpful. And if you want to learn more
about sound mind investing, go to Sound Mind Investing. Uh, Mark.
Tie a bow on this for us. What would you
leave us with today?
S2 (40:24):
Yeah. You know, the big thing really is not to
be able to identify exactly where we are in all
these cycles. What the main goal is, is just to
recognize that markets have cycles. And when you recognize that,
it's going to help you resist the temptation to project
today's conditions indefinitely into the future. So that's the big thing.
(40:48):
The other is just to be thinking strategically about those
big bond allocations and whether or not that's really the
best path forward. Um, you know, the main goal is
we're trying to build portfolios you can stick with and
that are going to be resilient for you through both
secular and cyclical bull and bear market shifts.
S1 (41:09):
Yeah, I think that's well said. And of course, if
folks want to take a deeper dive, they can head
to your website and check out this article. Marc, we
always appreciate our time with you, sir.
S2 (41:20):
Well, it's always a pleasure. Thanks for having me back, Rob.
S1 (41:23):
All right. We'll look forward to doing it again real soon, folks. Again,
the name of that article is Bulls and Bears Secular
and Cyclical. It's available for you at Sound Mind Investing. Well,
that's going to do it for us today as we
close out the broadcast today. Let me remind you, uh,
it's getting close to year end, which means it's a
(41:43):
really important time for us to hear from you at
Faith fi, as a listener supported ministry, uh, getting to
year end and reaching our year end goals really sets
us up for all the incredible things we're planning for
2026 to come alongside you, serve and support you as
you live out your role as a faithful steward. When
(42:04):
you go to give what you will see, there is
the progress we're making toward our year end goal. And
if you'd like to help us get there, we'd certainly
be grateful. The good news is, every gift is doubled
between now and the end of the year because of
some generous friends that have come alongside us. We're about
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(42:26):
and every gift of any amount will ensure that you
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Faith by Faith and Finance Live is a partnership between
(42:46):
Moody Radio and Faith fi. We'll see you tomorrow. Bye bye.
Markets rise and fall, but not all cycles tell the
same story. So what do those ups and downs really
mean for your investments? Hi, I'm Rob West. We often
hear about bull and bear markets, but those trends actually
come in two forms cyclical and secular. Understanding the difference
can help you make wiser, long term decisions with your portfolio.
(00:30):
Mark Behler joins us today to unpack these market cycles
and why they matter. And then we'll take your phone
calls at 800 525 7000. This is faith and finance live.
Biblical wisdom for your financial decisions. Well, we're so glad
to have Mark Behler with us today. Mark's our good friend.
He's executive editor at Sound Mind Investing, and he's our
(00:53):
go to guy when it comes to the markets, the economy,
your portfolio and specifically related to that topic. We'd love
to hear from you today. Mark will stick around for
the entire broadcast, so that means we will prioritize those
questions around the market. Perhaps you're wondering how to think
about your investment strategy here with this market up? Uh,
(01:14):
although we've been selling off as of late, uh, you know,
the market's been really strong this year, perhaps far more
than anyone expected. What does that mean for you? If
you're approaching retirement, what's the right mix of investments? What
do you do with gold here, given the incredible run
up that we've had? Any of those questions in play today,
when you call 800 525 7000, again, that's 800 525 7000.
(01:38):
We're talking today about cyclical and secular bull and bear markets.
We'll define that here in just a moment. But first Mark,
great to have you with us.
S2 (01:47):
Thanks, Rob. Great to be back.
S1 (01:50):
Mark, uh, this is a great article you wrote for
the Sound of Mine Investing newsletter. It was titled Bulls
and Bears Cyclical and Secular. And by the way, folks,
if you want to read it for yourself, head over
to Sound Mind Investing. Why don't we start with the basics, Mark?
People often hear about bull and bear markets. There's one
of those bulls sitting right out in front of the
New York Stock Exchange. So what do those terms really mean?
S2 (02:14):
Yeah. Well, Rob, you know, sometimes the articles that we
write for our online investing members, a lot of it
really is trying to help them understand and make sense
of all of the things that they hear in the
financial media. And otherwise. We hear these these kind of
jargon words thrown around, and people don't always know exactly
what they mean. So that was part of the deal
(02:36):
with this article. Um, and, you know, before we even
get to those definitions, you know, I think it's worth
pointing out that cycles are all around us in creation.
We see them everywhere. Um, we've we see them in Scripture.
Solomon wrote way back in Ecclesiastes to everything. There's a
season and a time to every purpose under heaven. You know,
(02:58):
looking around the natural world, we see the sun and
the moon and its cycles, the tides, the seasons and
so on. And financial markets go through their own sets
of cycles as well. They're less predictable than the natural world.
But the two most basic cycles are the the bull
and the bear cycles. And all we're talking about there, Rob,
(03:20):
is bull markets are when prices and markets are heading
up heading higher and bear markets are when they're heading lower.
S1 (03:31):
Yeah. Well it's really important to understand because these are
big ideas. But we can get a little more specific
because inside those bull and bear markets are something called
cyclical and secular markets. And this article we're touching on
today explores the differences. So go ahead and unpack those
terms for us.
S2 (03:51):
Yeah sure. Those are really just fancy words. fancy finance
terms for a very simple idea, and that is that
these market cycles come in two varieties. You have the
shorter term cycles, which we call cyclical short term. And
then we have these longer term cycles which we call
secular cycles. Where this can get a little bit confusing
(04:14):
is that sometimes they'll overlap. So you can have a
secular cycle, um, say um, the bond market, the US
bond market was in a secular bull market for 40 years,
from 1982 until Covid in 2020. So that's a secular
move where interest rates were generally falling through that whole time.
(04:37):
But within that secular move, you have lots of these
little cyclical moves where the interest rates might go up
for six months to a year inside of a secular
move where they were heading in the other direction. So
it's just really short term and long term cycles.
S1 (04:55):
Interesting. All right. Well we're going to talk about what
that means for the average investor. Those who are listening
to the broadcast today how they might learn from that perhaps.
What are some of the examples of what you just
described that we can see in history. And we'll be
taking your questions as well. Marc Biller here. Now's the
time to call. Go ahead and get in the queue
(05:16):
with your investing related questions today. We'd love to hear
from you. The number 800 525 7000. More with Marc
Biller right after this. Stay with us.
S3 (05:33):
The opinions offered during this program represent the personal or
professional opinions of the participants, given for informational purposes only.
Any information provided is not intended to replace advice from
a financial, medical, legal, or other professional who understands your
specific Situation.
S1 (05:57):
Great to have you with us today on Faith and
finance live. I'm Rob West, Mark Biller here today. We're
taking your calls and questions, uh, talking about cyclical and
secular bear and bull markets and what that means for you.
Before the break, Mark was explaining to us what these
terms mean bull and bear market, cyclical and secular. And Mark,
perhaps it would help just to have an example of
(06:20):
how these shorter cyclical trends fit within the broader secular trends.
S2 (06:25):
Yeah, sure. Well, let's look at the stock market for
a good example from 1968 to 1982. So that was
a 15 year period. The S&P 500 index was flat.
So what I mean by that is it was the
same value in 1982 that it had started at 15
years earlier. Um, that's kind of shocking. 15 years of
(06:48):
no gains. but in reality, it was actually a little
worse than that because we had such high inflation that
people actually lost a lot of purchasing power during that time.
At any rate, for our purposes here, that was a
secular bear market in stocks, 15 years of a flat market.
But within that, there were several really sharp gains and
(07:11):
losses in the stock market. Those were little cyclical bull
and bear markets that were happening within this longer term
secular trend.
S1 (07:22):
Interesting. Yeah, that helps to put a finer point on it.
As we think about where this has happened in the past,
by the way, we will be taking your calls and
questions here in just a moment. So if you have
a question for Mark Biller today, something on the markets,
the economy, your portfolio, call right now 800 525 7000.
That's 800 525 7000. Mark, let's take this down to
(07:47):
make it practical to those listening today. Why? Why does
it matter for everyday investors to know whether we're in
one of these cyclical or secular trends?
S2 (07:56):
Yeah, that's a great question. And honestly, Rob, it's probably
more helpful in terms of the bond market than the
stock market for a couple of reasons. One is stocks
move so much more than bonds do that whether it's
a cyclical move or a secular move. If stocks are
going to move 30, 40, 50% in one direction, we
don't really care what type of move it is. That's
(08:18):
a big move, and we're going to pay attention to
that regardless. With bonds, it's not usually that way. The
gains and losses tend to be much more incremental. And
the other thing about the bond market is you do
see historically these much longer, more pronounced one way moves.
(08:38):
So I mentioned earlier the 40 year bull market from
1980 82 until Covid in 2020. Well, that hasn't really
been that unusual for the bond market. And so if
especially today, where we may have had a shift around
Covid from a long trend of lower interest rates, which
(09:00):
is good for bonds, it increases bond returns to a
shift since Covid, where rates have been rising, which is
a headwind for bond investors. Well, if these tend to
last ten, 20, 30, 40 years at a time, we
should definitely pay attention to that. And bonds really are
a great area right now to focus on for this
(09:22):
idea of of secular versus cyclical moves, because as I
was just saying, we kind of had a turn during
Covid where interest rates started going higher. Um, after 40
years of really good bond returns, the last five and
a half years have been pretty poor for bond investors.
In fact, um, a lot of investors would probably be
(09:45):
surprised to realize that the main U.S. bond index is
negative over the last five years. Um, and so that,
you know, that is, um, if you're if you're looking
at a longer term picture, you would say, well, with
interest rates rising, I don't want to own any bonds,
but that's not necessarily the right takeaway, because if we
(10:06):
look closer and short term, I should say we've had
a cyclical move here in 2025 where bonds have actually
done pretty well. And with stocks kind of wobbling a
little bit, as you alluded to earlier, you know, bonds
aren't a bad place to be right now. So I
don't want people to hear this and come away with
(10:28):
the idea that we should sell all our bonds. It's
just this idea that even within a longer trend that
may have started back in Covid in 2020, um, you
can have these little moves still where it makes sense
to own an asset. Where we're really trying to focus
is for the longer term, how do we want to
(10:50):
set up our portfolios over the longer term in light
of these cycles?
S1 (10:55):
Yeah, that's really helpful. All right. So somebody who's listening
today that's a long term investor. How do these ideas
then shape how they build their portfolio.
S2 (11:04):
Yeah. And to be clear I'm definitely not trying to
get people to go out and change their long term
plans dramatically here. But sticking with this idea with the
bond market, you know, for the last 45 years, investors
basically have been told you can allocate a huge amount
of your portfolio to bonds. They're safe. You're going to
(11:26):
earn good returns. They're going to go up when stocks
go down. And so as a result, a lot of
our industry as you well know, Rob, is kind of
centered on this idea of, you know, a 60 over
40 or a 50 over 50 stock bond portfolio, and
you don't need a whole lot else. Well, if this
is a new secular bear market in bonds, we may
(11:48):
not want to rely on bonds for as large a
portion of our portfolios going forward as we have over
the last 3 or 4 decades.
S1 (11:58):
Hmm. Yeah. So, you know, how does that work itself out, uh,
in your portfolios? Uh, as you all are building these
for your investors.
S2 (12:08):
Yeah. So we've we've kind of had our eye on
this for a while. Rob. And we were a little
bit early. Uh, and to be honest. But it is
kind of playing out the way we expected it eventually would.
And what we've done to prepare for that and in
response to that is we've tried to come up with
strategies that are less, um, dialed into large static portfolio allocations,
(12:36):
like I was saying. Instead of being a 60, 40, uh,
investor portfolio with 40% in bonds no matter what. We
have strategies one called dynamic asset allocation, where the name
kind of gives away what we're doing, where we're altering
those allocations depending on the market cycles and conditions. Um,
(12:57):
earlier this year, we we helped launch an ETF that
diversifies across 20 different assets. Um, and a big part
of that is just this idea that if we've entered
into a bond bear market, we need to look at
some different assets for exposure to try to build a
(13:19):
safety net within the portfolio that bonds used to fill
that need completely. And we're still using bonds, but we
want to add some other things to get other types
of diversification as well.
S1 (13:31):
Interesting. Well, we'll, uh, we'll get you to share a
few of those other things that you're using alongside bonds,
especially given your outlook for bonds. Uh, when we come back,
we'll also be taking your phone calls as well. Now's
a great time to call. We've got some lines open.
Mark Billers here today. We're talking investing the markets and
your portfolio. So there's something you want to check with
(13:54):
Mark on. Go ahead and call right now. Here's the
number 800 525 7000. We'll begin diving into those market
and portfolio related questions after this break. 800 525 7000.
If you want to check out this article, you'll find
it at Sound Mind Investing. Org. It's titled Bulls and
Bears Cyclical and Secular. Mark Biller here today back with
(14:18):
much more just around the corner. Stay with us. Great
to have you with us today on Faith and finance Live.
We're talking cyclical and secular bull and bear markets today.
Market trends and how they affect your portfolio. Mark Millar's here. Today.
(14:42):
We're unpacking the article he wrote for the Sound Mind
Investing newsletter. You'll find it at Sound Mind Investing. Org
just look for bulls and bears, cyclical and secular. We
want to take some of your calls and questions as
well today. Prioritizing those questions around the market and building portfolios.
Let's head to the phones right now Maria is joining
(15:03):
us from Florida. Maria go ahead.
S4 (15:06):
Hi. Yes, I was saying that I do have a
CD right now and it's maturing now in December, and
I'm looking to see where I can find better options
for myself. Who can I call for CD 30 35,000?
S1 (15:22):
Sure. Yeah. You know, it always comes down, Maria, to
the purpose of the money. And that purpose often drives
what's called the time horizon. And that's just simply how
long before you need access to the money. Uh, you know,
we'll start typically with what we call an emergency fund.
And by definition, an emergency fund is money you need
(15:43):
in an emergency on a moment's notice. So you've got
to keep it liquid and safe. So that's why we
normally talk about a savings account, paying a nice interest
rate or a money market account. And then if we
have a year's time, we may say, okay, we can
move beyond savings and maybe look at a CD. Um,
and then if we have, let's say more than five years,
(16:04):
we may want to, you know, introduce some stocks, maybe
between 1 and 5 years. We could talk about a
bond mutual fund. So talk to me for a second
just about the purpose of this money and how safe
you want it to be.
S4 (16:19):
Okay. I don't need it right away. I do have
emergency funds. Um, I'm looking to see maybe to maybe
1 or 2 years that I don't need it.
S1 (16:32):
Okay. Very good. Excellent. Mark 1 to 2 years on $35,000.
What thoughts do you have?
S2 (16:39):
Yeah. You know, I think that with with that kind
of a time frame, you are looking at, you know,
a CD, a good, uh, either high yield savings account,
you could get into bond funds, but that generally is
is going to be introducing a little bit more complexity. Um,
which is fine if you want to do that or
(17:00):
if you already have a brokerage account. That makes it
very easy. But I don't know if I would go
out and do that, you know, just for this in
this case, if you don't already have that set up,
I guess 11. that I would make is if you
are going to go the CD route or if you're
comparing it with high yield savings accounts, you know, we
(17:21):
we have recently entered into a interest rate cutting cycle
where the Federal Reserve has started lowering interest rates. and
most investors expect that they will continue to lower interest
rates throughout 2026. And what that tends to do when
(17:43):
the fed is lowering those short term rates is it
does bring the yields down on savings products like CDs
and like high yield money markets and that sort of thing.
So if you are looking at a CD, um, it
might be a time to, to push that maturity a
little bit longer, like getting a one year CD instead
(18:06):
of a six month CD or something like that, to
try to lock in today's higher rates instead of likely
getting lower rates as we move into 2026. So that
would be my my one little insight there. Rob, what
else would you suggest?
S1 (18:23):
No, I think you're right on. So I think the
place to go Maria, if you want to shop these
rates and find out who has the best CD rates
or the best savings accounts rates you could go if
you're comfortable on the web. Bankrate.com bank rate and then
click High-yield savings click CDs every day they update it
with the the banks that have the best rates. You're
(18:45):
going to look for something FDIC insured. And, um, you know,
you'll look for something that's 4 to 5 star rated.
So you could also, if you want to look somebody
in the eye, go into a local bank or credit union,
you just may not get, you know, as much as
you'd get if you were willing to use an online
bank just as safe. Um, but you are, you know,
(19:06):
typically going to have to do business online to get
the very best rates. Maria, thanks for your call today,
Indiana grant. Go ahead.
S5 (19:14):
Yeah. Thank you. Uh, we're looking at possibly retiring in
2 to 3 years. We've got some funds available for
multiple purposes. Uh, what kind of dollar amount would be
or percentage amount would be feasible to do a bonds
or CDs?
S1 (19:32):
Yeah. Mark.
S2 (19:34):
Yeah. So, you know a good rule of thumb, Grant.
You know, that's been around for a long time is, um,
you know, taking your I guess there are a few
different ones. Rob probably knows a few, too. But the
idea of of reducing, uh, you know, start with 100,
reduce your age, and that will give you your bond allocation.
(19:54):
Those are very, very broad brush type ideas. Um, you know,
like I've been saying here earlier, um, we're in the
process of kind of rethinking some of those rules of
thumb and whether, um, investors should have as much allocated
to bonds as they have in the past. Um, and
(20:15):
so we have a couple of, uh, approaches at Sunlight
Investing that have us, you know, someone who in the
past might have allocated 40% of their portfolio to bonds.
They might be at 30% now with a mix of
some other assets within some strategies that we have. Um,
also some strategies that will move the bond allocation up
(20:38):
and down, uh, and treat the bonds a little bit
more like you might treat an umbrella. I mean, I
don't know about you, but when I wake up in
the morning, I don't automatically go outside with my umbrella open.
But if it's raining hard, I definitely want to have
it open on those days. And that's kind of how
we treat some of these allocations. You know, there are
(21:00):
certain times in the cycle where we want to have more,
other times in the cycle where we want to have less.
So that that gives you a general idea. But, you know,
for folks kind of hitting retirement age, typically somewhere in
that 40 to 60% is usually pretty pretty reasonable.
S1 (21:20):
Yeah, I think that's exactly right. Whether you use 110
minus your age, because people are living longer or 100
minus your age. I mean, at 65, you know, you're
talking somewhere between, uh, you know, 45 and 35% in
the bond category or bond equivalent, as Mark said, maybe
a rounded out with a portion of that in gold
(21:41):
or Bitcoin or something like that, a small portion. Uh,
and then the balance in stocks recognizing you still have
a long time horizon even when you hit retirement. Thanks
for your call back with Mark after this. Stay with us.
(22:02):
Thanks for joining us today on Faith and Finance Live.
Mark Biller is here today. He's executive editor at Sound
Mind Investing, a long time underwriter of this program. And, uh,
Sound Mind has been a great friend going all the
way back to Larry Burkett and their founder, Austin Pryor,
who were good friends and partners in ministry. And we
enjoy a great relationship that continues to this day. Mark's
(22:23):
a regular contributor here. If you want to learn more
about sound mind investing, go to Sound Mind Investing. Mark,
before we head back to the phones you were talking about, just,
you know, the short term outlook for bonds is probably
pretty good as rates head down. But perhaps as we
look out five years plus, maybe not so much. I
know you all have some strategies where you're taking that
(22:44):
bond portion of the portfolio and adding some other things
into that to round it out. Perhaps that might do
a little better over the next five plus years. Give
us a sense of what types of things you're using there.
S2 (22:57):
Yeah, sure. You know, I think it's it's probably healthy
to to unpack. Why have bonds been struggling? I think
that may help people to kind of connect the dots. And,
and a lot of this is that we've been in
a higher inflation environment. You know, we've had close to
five years that we've had monthly inflation prints that have
(23:21):
been higher than the Fed's 2% annualized target. So it's
been almost 16 months since we had a reading that
was below 2%. So in that in a higher inflation environment, um,
what we're looking for are things that are going to
hold their value in that type of inflationary environment. So
(23:43):
as we we think about those sorts of things and also,
you know, the the factor that we've talked about in
recent programs, Rob, where the the government's response to every
crisis seems to be to stimulate more print, more money
to base the currency. You have these twin forces of
(24:04):
inflation and currency debasement. And so a lot of the
things that we've been adding to our portfolios are things
that directly address those two issues. And so a few
of those things would be gold. We've talked a lot
about that and how well gold has done. But gold
really kind of hits both of those. Inflation and currency
(24:26):
debasement areas. Another thing that we've been writing about and
have added to our portfolios in the last five years
is some commodity exposure. Um, we didn't have that until 2020.
We didn't really feel like we needed it, but it
fills a different niche now. Um, real estate has historically
(24:47):
been a good inflation fighter. It's a little bit of
a mixed bag because real estate sometimes doesn't respond well
to higher interest rates. Um, but you and I have
discussed the pros and cons of a small bitcoin allocation. Um,
we've been seeing the last month or two how volatile
bitcoin can be. So all of those warnings about keeping
(25:09):
your sizing very small on bitcoin certainly appropriate. We're getting
a good illustration of that right now. Um, you know
in September Morgan Stanley's chief investment officer, created a lot
of waves in the investment business when he suggested that
the traditional 60 over 40 stock bond portfolio should be
(25:30):
adjusted to 60% stocks, 20% bonds and 20% gold. That
was like a bombshell going off across the industry. And
to be quite honest, Rob, as much as I like
gold and I really do, even I'm a little bit
uneasy with the idea of 20% of the portfolio in gold.
(25:52):
But that said, if you take that idea of going
to like 60 stock, 20 bonds and 20 something else,
where maybe 10% of that is gold and the other
ten is a blend of commodities, real estate, energy stocks,
a little bit of Bitcoin. You know, some diversifiers like that.
(26:13):
That type of an approach really makes a lot of
sense to me.
S1 (26:17):
Interesting. Well, of course folks can do this themselves, but
you all have made it easy. Whether it's through the
dynamic asset allocation in the Sound Mind Investing newsletter or
even some more accessible products like an ETF. Right.
S2 (26:32):
Yeah, we we started helped launch an ETF earlier this
year that does some of this dynamic position sizing across
20 different asset classes. And so that makes it really
easy for people to just buy one thing, hold that
one ETF and know that this type of adjusting is
(26:53):
going on automatically within that wrapper. So that makes it
really easy for folks.
S1 (26:59):
Excellent. Check it out at Sound Mind investing.org. All right.
Let's get to as many calls as we can here.
Speaking of gold, Mimi wants to talk about perhaps whether
this is the time to buy gold for her portfolio. Mimi.
Go ahead.
S6 (27:13):
Yes. That's right. So good afternoon. Thank you for taking
my call. Sure. So I was looking at the website
for gold. I guess they got my name and then
they started calling me to sell gold. So I don't know,
how do you buy gold? Is it? So I asked them.
So I want to ask you now, do you buy
gold like they were selling it per ounce? I said,
(27:36):
but isn't that like a stocks that you can also
buy on the internet? I mean on, on for Schwab
or whatever. Um, platform. So how do you buy gold
and is it a good time to buy gold?
S1 (27:47):
Yeah. Great. Mark.
S2 (27:48):
Yeah, absolutely. Great question. So you do have to be
careful because there are a lot of people who want
to sell you gold. And like with a, with a
lot of these products, um, the best way to know
whether it's a good deal or a bad deal is
to go online and look at what the what's called
the spot price for gold. So if you just look
(28:10):
up the gold price online and see what it's trading at.
That will give you an idea of how much of
a premium any particular gold purchase is charging over that
spot price. And the goal, Mimi, is to to find
the the best option that's charging a low premium, the
(28:33):
lowest premium. Of course, you want to deal only with reputable,
trustworthy sources. I should throw that in too. But let
me give you a couple of examples here. So, um,
one place that people have started buying gold, um, a
lot of gold is actually Costco. And the reason Costco's
gold is so popular is because they have a very
(28:55):
small markup over that spot price, which makes it very appealing. Um,
this is this is where the internet can really help you,
because knowing what that spot price is, you could even
walk into a local coin shop, a gold shop in
your town or your city and see how much their
markup is and how that compares to different options where
(29:17):
you could buy gold online. The other main way Mimi
to buy gold. That's very easy. You mentioned having a
Schwab account is you can buy ETFs that invest directly
in gold. So there are multiple of those. Um, some
of the ticker symbols are GLD. There's another that's physical gold.
(29:40):
And you can buy those ETFs just like any other ETF.
And think of that as essentially going 100% into gold
without a markup without a premium. Now of course, what
you are sacrificing is you don't hold that gold in
your hand. So, you know, that is a financial product,
(30:01):
even though they are are buying gold, which is audited
in those ETFs. A lot of people do prefer to
own their own gold and have it in hand. But
those are the two main ways you can buy gold coins.
A one ounce US Eagle. Um, or you can go
online and buy the gold ETFs. Both are effective. There
(30:24):
are different pros and cons.
S1 (30:26):
Yeah. And if you're wanting just to add that gold
exposure to to your portfolio and not interested in kind
of keeping it and passing it down to the next generation,
I think that ETF makes it really attractive, Mimi, because
you don't have to worry about the dealer, the markup,
the security, all of that. You just buy like a
stock GLD or one of the others. Hope that helps.
(30:49):
Thanks for your call back with more after this break.
Stay with us. Great to have you with us today
on Faith and Finance Live. Mark Miller is here today.
He's executive editor at Sound Mind Investing, a longtime underwriter
of this program. If you want to learn more, just
go to Sound Mind Investing. We may have room for
(31:11):
one more phone call in addition to those holdings. So
if you've got an investing related question, call right now
800 525 7000. Let's go to Tennessee. Brian. Go ahead.
S7 (31:22):
Hey, thanks for taking my call. I'm a little rural,
so I hope you can. I hope I don't lose you. Um,
so I think you may have already answered my question
as it relates to your recommendation about bonds. So I'm 59,
you know, target date or target age, maybe 65 for retirement.
I'm pretty I'm pretty aggressive in all my 401 K portfolio. Um,
(31:44):
so based on what I heard you say, being 59
and you deduct my age from 100, that should mean
I would be 40% in bonds. Is that accurate?
S1 (31:53):
Yeah. Mark your thoughts.
S2 (31:58):
People have thought about this for for the last few decades, Brian.
And I think the two factors that we've been kind
of highlighting today, one, it may be appropriate to rethink
that just on the face of, uh, if bonds have
moved into a secular bear market, we may want to
look for some alternatives. Um, and then the other part
(32:20):
of that, too, is that people are living longer. And
so if you do retire at 65, um, you know, there's, uh,
an eye popping statistic I often will throw at people
that if a couple retire at 65 and good health,
the actuarial numbers suggest that there's a 5050 chance that one,
(32:43):
at least one of those two are going to live
to age 90. Well, that really does change things, because
if you retire at 65 and you have a 25
year time horizon, you don't necessarily have to go to
a super conservative posture with your investing on day one
of your retirement. You've got 25 years ahead. So those
(33:06):
are some things to think about. Some reasons why you may,
you know, be moving in the direction of a higher
bond allocation, but not feel a lot of pressure to
get there in a big hurry. Those are my thoughts. Rob,
how about you?
S1 (33:22):
Yeah. Totally agree. I mean, I think because of those realities,
Brian keeping a little bit more in stocks, maybe supplementing
that traditional bond portion of the portfolio with, you know,
a little bit of precious metals, as Mark said, maybe
some exposure to commodities, maybe even a small portion to Bitcoin,
I think, you know, could round that out. Keep that growing,
(33:45):
help you overcome this, you know, sticky inflation that we've
been dealing with and recognize. You know, time is on
your side. And so we still need to take a
decades long, you know, three decades or more approach, even
after you retire, to how long this money needs to last.
I think the other approach is to find an advisor
who can, you know, help to be a little more
(34:07):
strategic and dynamic like Mark's been talking about? Even the
team at Sound Mind investing.org could be helpful, but hopefully
those give you a few thoughts to think about as
you're considering. Um, you know, how conservative do you get
as you, uh, you know, head into those retirement years?
We appreciate your call. Uh, Mike is in Ohio. Mike.
Go ahead.
S8 (34:29):
Thank you for taking my call. I really love your show.
I just want to say that you are very popular
in the trucking industry. That's what. Hey, that's good for
a living.
S1 (34:38):
Excellent. I'll take it.
S8 (34:42):
So. So here's my question. I got a year and
a half ago, I retired at 63. I got north
of half a million, uh, in an investor. And I
also have a 401 K at work with about 150,000. Okay. So, uh,
with what I'll be drawing on Social Security. I need
some supplement that'll come from my investments. Yeah. Do I
(35:04):
roll it into an annuity? So I got a set
amount coming in each month. Or is there a way
to leave it in the market but still draw about
2000 and 2500 a month to supplement my Social Security?
S1 (35:20):
Yeah. And basically we're saying you've got about 650,000 between
the two accounts you could use to supplement that Social Security.
S8 (35:31):
That's correct. And I'm still working. So I got another
year and a half to add to that. Yes.
S1 (35:35):
Yeah. Great. I mean, so let's say it's up around 700,000.
I mean, I think the good news is, Mark, even
without an annuity, which is going to lock up the
money and create some complexity, you know, 650, 700,000 if
he needs 2000 a month. I mean, that seems very realistic, right?
S2 (35:52):
Yeah it does. And and Mike, this is exactly the
type of situation that many, many, many of our SMI
members and also our private client investors where we do
the investing for them, they're in this exact situation. So
this is very common. It's absolutely possible to do your
own investing and then just draw from those investments as
(36:18):
you go to get the income that you need. Um,
all you know, the advisors from Kingdom Advisors, that's what
they specialize in as well. Um, so getting a good
advisor to help you can can simplify that or, um,
you know, like I mentioned, our SMI members tackle this, uh,
type of situation all the time. It's really kind of the,
(36:41):
the focus, uh, building that nest egg and then working
on how to invest it and draw that down. Those
are major themes of our, uh, our newsletter. And we
help people do that all the time. So definitely be encouraged.
That's not to say you shouldn't do the annuity option,
but you certainly don't have to. There is definitely another path. Um,
(37:05):
and you know, like Rob and I often will mention,
the annuity path tends to be an expensive path. And
so if you're willing to do it yourself or work
with an advisor to do it, you can usually accomplish
those same goals with lower fees and more flexibility because
you're not locking that money up in the annuity. So
(37:26):
those are my my thoughts there. Yep.
S1 (37:29):
Yeah I think you're right on there. I mean, so
basically what we're saying is, you know, if you grow
that to 700,000, 4% a year, which is very realistic,
is 28,000, you know, that's 2300 a month, you're gonna
pay a little tax on it, probably. And maybe some
of your Social Security is taxable. Um, but if you
can continue to work, delay that Social Security as long
(37:50):
as you can, then you know, that is very realistic.
The nice thing is, if you have an advisor managing
managing it like a certified Kingdom Advisor or the team
at Sound Mind Investing. You know, you could transfer that
to them. They could manage it for you. You know,
keeping the risk minimal, uh, just to meet your income needs.
(38:11):
But you'd still have full access to the money. So
if you needed it for, you know, some long term
care for a period of time and you needed larger chunks,
you can get to it as opposed to the annuity,
where you're going to have more in the way of
lockup periods and that kind of thing. Now, at the
end of the day, if you say, listen, I just
don't want any market risk, I'd rather place that on
the insurance company. Well, that's where people will use annuities. But,
(38:36):
you know, if you can find an advisor who you
feel good about, you know, we kind of prefer just the,
the plain vanilla investing, keep full access to your money. And,
you know, I think it's just a better way to
go overall. Does that make sense?
S8 (38:51):
That makes a lot of sense. I actually have a
financial advisor investor that is a Christian man. He does
a great job. Now, one quick second question if I can.
He's earning me 14.5% over the last two years that
I since I've been with him. How long do you
think that's going to last?
S1 (39:10):
Yeah. I mean, it's a great question. We've just been
in a really unusual period where we've had just some
really phenomenal, uh, returns. Marc, do you feel like, you know,
we talked a lot about the bond market as you
look out over the next ten years, do you think
we need to be comfortable with, uh, more tempered annualized returns?
S2 (39:29):
Yeah, I think unfortunately, we probably do need to have
that expectation. History tends to history suggests that when we
start from the types of elevated stock valuations that we
have today, that the forward ten year returns tend to
be lower. So that is a reasonable expectation. Um, of
(39:51):
course it's always it's always different this time. Right. And
so it is hard to know. You never know. And
that's why we do try to focus on those extended
time periods, 5 to 10 years at a time. Because
in the short term, anything can happen with the stock market.
S1 (40:08):
Yeah. Hey, I really appreciate you being on the program today, Mike.
Thanks for your kind remarks about the program. I hope
that was helpful. And if you want to learn more
about sound mind investing, go to Sound Mind Investing. Uh, Mark.
Tie a bow on this for us. What would you
leave us with today?
S2 (40:24):
Yeah. You know, the big thing really is not to
be able to identify exactly where we are in all
these cycles. What the main goal is, is just to
recognize that markets have cycles. And when you recognize that,
it's going to help you resist the temptation to project
today's conditions indefinitely into the future. So that's the big thing.
(40:48):
The other is just to be thinking strategically about those
big bond allocations and whether or not that's really the
best path forward. Um, you know, the main goal is
we're trying to build portfolios you can stick with and
that are going to be resilient for you through both
secular and cyclical bull and bear market shifts.
S1 (41:09):
Yeah, I think that's well said. And of course, if
folks want to take a deeper dive, they can head
to your website and check out this article. Marc, we
always appreciate our time with you, sir.
S2 (41:20):
Well, it's always a pleasure. Thanks for having me back, Rob.
S1 (41:23):
All right. We'll look forward to doing it again real soon, folks. Again,
the name of that article is Bulls and Bears Secular
and Cyclical. It's available for you at Sound Mind Investing. Well,
that's going to do it for us today as we
close out the broadcast today. Let me remind you, uh,
it's getting close to year end, which means it's a
(41:43):
really important time for us to hear from you at
Faith fi, as a listener supported ministry, uh, getting to
year end and reaching our year end goals really sets
us up for all the incredible things we're planning for
2026 to come alongside you, serve and support you as
you live out your role as a faithful steward. When
(42:04):
you go to give what you will see, there is
the progress we're making toward our year end goal. And
if you'd like to help us get there, we'd certainly
be grateful. The good news is, every gift is doubled
between now and the end of the year because of
some generous friends that have come alongside us. We're about
130,000 away from our goal. Every gift of any amount doubled,
(42:26):
and every gift of any amount will ensure that you
get a copy of my new devotional, Our Ultimate Treasure,
that comes out in January. Head to faith. Com to
learn more and thanks in advance! Big thanks to my
team today Josh Taylor, Tahira, Omar and everybody here at
Faith by Faith and Finance Live is a partnership between
(42:46):
Moody Radio and Faith fi. We'll see you tomorrow. Bye bye.
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