September 26, 2025 • 42 mins
Have you ever noticed how “unexpected expenses” always seem to show up at the worst time? The truth is, most of these costs aren’t surprises at all—we know cars break down, homes need repairs, and Christmas comes every year. On the next Faith & Finance Live, Rob West talks about how sinking funds can help you prepare with wisdom instead of panic. Then, it’s on to 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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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
S1 (00:08):
Have you ever noticed how unexpected expenses always seem to
show up at the worst time? Hi, I'm Rob West.
The truth is, most of these costs aren't surprises at all.
We know cars will break down, homes need repairs, and
Christmas comes every year. Today we'll talk about how sinking
funds can help you prepare with wisdom instead of panic.
(00:30):
And then it's on to your calls at 800 525 7000.
That's 800 525 7000. This is faith and finance. Live.
Biblical wisdom for your financial decisions. Scripture has a lot
to say about this kind of preparation. Proverbs 2120 reminds us,
(00:51):
precious treasure and oil are in a wise man's dwelling,
but a foolish man devours it. Wisdom means setting aside
resources now instead of consuming everything immediately. One simple way
to do this today is by using sinking funds. A
sinking fund is money you set aside gradually for a
future expense. Instead of panicking at a $1,200 Christmas bill,
(01:14):
you can save 100 per month all year. Instead of
reaching for a credit card when your car needs new tires,
you draw from the fund you've been building. It's not glamorous,
but it provides peace of mind and freedom from debt.
This mirrors the principle Joseph applied in Genesis 41. When
warned of famine, he set aside one fifth of the
(01:35):
grain during years of plenty. His preparation was not random.
It was systematic and consistent. Sinking funds are the same. Disciplined,
steady contributions toward needs we know will eventually arise. Another
biblical picture is found in Proverbs six six through eight.
Go to the ant, O sluggard. Consider her ways, and
(01:55):
be wise without any chief officer or ruler. She prepares
her bread in summer and gathers her food in harvest.
God holds up the ant as an illustration of diligence. Why?
Because she doesn't wait until the snow falls to collect grain.
She steadily prepares during harvest season. Preparation in the present
(02:15):
leads to provision in the future. You may ask, but
isn't trusting God enough? Shouldn't I just pray when an
expense comes and rely on him to provide? We have
to remember that trusting God never means neglecting stewardship. Throughout Scripture,
trust and planning go hand in hand. Noah trusted God,
yet he still built the ark. Farmers trusted God, yet
(02:37):
they still sowed seed. Joseph trusted God, yet he still
stored grain. Faith is not passivity, it's obedience expressed in
wise living. Setting up sinking funds isn't a lack of faith,
it's a demonstration of it. It recognizes that God provides
resources today to prepare for tomorrow. So where should we start? Well,
(02:59):
consider expenses that are inevitable, but irregular. Common categories include
car repairs and replacement. You may not know when, but
you do know the repair shop will eventually call your name.
Home maintenance, whether it's a leaky roof, worn out furnace,
or broken appliance, homes require care. Medical costs, co-pays, and
(03:20):
deductibles always come around. Gifts and holidays. Birthdays and Christmas
are not surprises. They fall on the same day every year.
Insurance premiums or taxes, if paid annually or quarterly, sinking
funds break them into small, manageable pieces. Think of sinking
funds as Joseph's storehouses. They don't need to start big.
(03:41):
Consistency matters more than amount. Even setting aside just $25
a month builds margin over time. The New Testament shows
the same mindset in one Corinthians 16 two. Paul urged
believers to set aside money regularly in proportion to income
to meet the church's needs. That's essentially a spiritual sinking fund.
(04:01):
Planned systematic stewardship is a biblical habit, not only forgiving,
but for household provision. Of course, we must balance preparation
with perspective. Jesus warned in Luke 1216 to 21 against
hoarding wealth for ourselves. The goal is not to stockpile,
but to steward resources so we can live responsibly and freely.
(04:24):
Bless others. A sinking fund isn't about building treasures on earth.
It's about positioning ourselves to walk wisely while keeping our
hearts focused on God's kingdom. Here's a practical place to start.
Choose just one category. If you've never saved this way,
begin with Christmas. Break the cost into monthly pieces and
start setting aside now. Once the habit is established, add
(04:47):
a second fund like car repairs or medical expenses. Over time,
you'll have a system that turns stress into intentional planning.
In the end, creating sinking funds is more than a
budgeting trick. It's discipline and practice. It's the daily choice
to trust God by stewarding his provisions carefully, planning not
(05:07):
out of fear, but out of faith. With each small deposit,
you build not only financial stability, but also a testimony
of wisdom and obedience. So start planning today and build
sinking funds for the future. All right, your calls are next.
800 525 7000. We'll be right back.
S2 (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.
S3 (05:58):
Great to have you with us today on Faith and
finance live. I'm Rob West, looking forward.
S1 (06:01):
To taking your calls and questions today. That number to
get in on the conversation is 800 525 7000. Again
that number 800 525 7000. We'd love to tackle whatever
is on your mind today and we will do that
when you call. Lines are filling up but they're open
at the moment. So go ahead and call right now.
Coming up in our final segment today, Jerry Bowyer stops
(06:23):
by and it's a good time to hear from Jerry
on the markets. The markets are up across the board
today at least the Russell 2000. The Nasdaq, the S&P 500,
which snapped a three week, uh, winning streak. We saw that,
uh the Dow rising 300 points today after an in-line
inflation report. We'll get Jerry's take on all of that.
(06:45):
But alongside those other metrics of the economy is the, uh,
the fact that the US economy grew faster this spring
than anyone expected. Uh, that posted its strongest performance in
nearly two years. A new government report shows that gross
domestic product expanded at 3.8% annualized in the second quarter
(07:08):
of 2025. That's up from earlier estimates of 3.3%. And again,
that marks the biggest quarterly gain since late 23. Here
are a few details of that revised report. First of all,
consumer spending rose at 2.5% annualized. That's stronger than first thought.
Business investment grew. That was led by equipment and intellectual
(07:30):
property imports fell, which effectively boosted GDP because imported goods
are subtracted from the total. Now, on the surface, this
sounds like all good news. It's worth remembering that much
of that growth came from household spending. So remember, as stewards,
we're called to live wisely with discipline, saving and having
(07:51):
plenty of generosity to go along with it. So our
growth reflects God's wisdom, not just consumer demand. Bottom line
stick to your budget, but all in all, a pretty
good report. We'll get Jerry's take on that in the
final segment today. All right. Let's dive into your questions again.
If you want to be a part of the conversation today,
go ahead and call right now 800 525 7000. We're
(08:15):
going to begin in Indiana today. Randy go ahead.
S4 (08:19):
Yes. Hello. How are you doing?
S1 (08:21):
I'm doing great. Thanks for your call, sir.
S4 (08:23):
Certainly. Um. I'm calling. Uh, first of all, I've got
a couple of questions. First question is, I'm just kind
of wondering how, if at all, um, investing affects, uh,
prices since, uh, companies are trying to give a return
on investment.
S1 (08:44):
Hmm. Yeah. So you're talking about inflation basically.
S4 (08:51):
Possibly, yeah I guess. Yeah. I mean that's definitely the,
the term. But uh, when I looked it up it
said inflation affects investing. But I'm just wondering if it
goes the other way around.
S1 (09:02):
Yeah. Um, sure. Well, you know, I think I mean,
first of all, inflation is when the prices of goods
and services rise broadly across the economy. And that's usually
driven by. And you'll remember this from economics, uh, you know,
too much money chasing too few goods. Um, and so
that leads to rising costs. Um, you know, with regard to, uh, investment, um,
(09:28):
you know, the at the end of the day, uh,
investment is, you know, we're putting capital to work inside businesses, uh, we're,
you know, providing them capital to provide their goods and services. Um,
you know, short term when people invest. So stocks, bonds,
retirement accounts that money isn't being spent in the real
(09:51):
economy because, you know, it's not chasing goods and services
which generally does not cause inflation. Um, ultimately, long term
investment can actually reduce inflation pressure because companies use that
investment capital to expand and hire and innovate. And so
that means more goods and services with less upward pressure
(10:15):
on prices. Um, but, you know, if investment were to fuel,
let's say, a speculative bubble. So think the.com of 2000
housing prices in oh seven and oh eight, you know,
it can create asset inflation because the prices of, of
stocks or real estate rises and that uh, but that's
(10:36):
different from consumer price inflation. So I would say at
the end of the day, um, you know, Inflation, um,
you know, related to investing is generally not a result
of investment because those dollars aren't being spent at the
grocery store or the gas pump. They're going into companies
to grow. And again, that helps in fight inflation over
(11:00):
time because we're increasing supply and productivity. Uh, at the
end of the day. And the real driver of inflation really,
as I said is is too much demand for goods,
which leads to rising costs or, you know, more money
being printed, not people putting money in their four one
or ultimately in stocks and bonds, if that makes sense.
S4 (11:22):
Yes it does. Okay. Makes sense. Uh, my next question, um,
I have received and still receiving some beneficiary checks and
thinking to invest. And I've gone to fe fi.com and
looking for Kay. And there's the investing and the planning.
(11:46):
And I'm just curious as to which, uh, certification would
be more appropriate for investing.
S1 (11:55):
Yeah. Yeah. Um, you know, typically what you will find is, um,
you know, if somebody has the cash and they're showing
up in the investing directory, which basically just means when
you go to faith. Com and you do a search
for a K, it's going to ask you which of
the disciplines you want to find a K in. And
(12:17):
you know, they have to go through the coursework and
pass the proctored exam. And everybody you know has to
do the, uh, integrity requirements and ethics and, you know,
regulatory review. But to be able to be published to
the various directories, whether that's financial planning or investments or
even tax and accounting, they each have their own requirements.
So in the Investment area, it would require at least
(12:41):
ten years experience. Um, you know, serving clients with investment
advice or one of the appropriate designations. Now, you know,
the most notable designation specifically around investing is the CFA
Chartered Financial analyst. But that typically skews toward those professionals
who are actually analyzing companies, you know, and making strategic
(13:05):
decisions about portfolio construction. Not usually wealth managers who are
the client facing investment professionals. Often they might have the
CFP designation, which is known more so for the planning side,
but does cover a pretty good amount on investing. Um,
so I would say in terms of what you're looking for,
anybody that shows up in the directory that qualifies to
(13:29):
be in that particular directory for those looking for investment advice,
would have our confidence that they have, you know, met
the requirements to be able to provide sound investment advice.
Some of them will have gone to earn the CFA.
Many will not. But ultimately, you know, we would feel
like they would be able to bring you the kind
(13:50):
of advice you need on the investment management side. So
there's not an obvious designation in the investment space like
there is in the planning space with CFP. But, you know,
we would feel confident that if they're showing up in
that directory, they've met the criteria. Does that make sense?
S4 (14:08):
It does. Um, but still not feeling. It's answering the
question of whether it ought to be investing or planning.
S3 (14:18):
Got it. Okay. Let's talk about that after.
S1 (14:20):
The break, and we'll dial in to what you need
in your situation. Stay right there, Andy. We'll be right back.
Great to have you with us today on Faith and
finance live here on Moody Radio. I'm Rob West. We're
taking your calls and questions. Before the break, we were
talking to Randy about investing and specifically how to choose
(14:44):
an advisor to help with investing. And Randy's wondering about
the difference between investing and financial planning. And, Randy, are
you just to make sure I understand the question? Are
you wondering which type of professional you need based on
your situation, or you know what you need? You're just
wondering the appropriate designation to go with each help. Help
(15:05):
me make sure I'm answering the question appropriately.
S4 (15:08):
Well, um, let's see. So, uh, I'm just seeing the
there's the category of planning and the category of investing. Yes. And, uh,
as I mentioned, I'm receiving beneficiary checks, and I don't
have to utilize it and kind of don't want to, uh,
I would like to just go ahead and invest it.
(15:31):
And so just it seems like there's a nuance between
the planning and investing. And yeah, just which, as I
mentioned earlier, the certification. That would be better.
S1 (15:41):
Got it. Yeah, that makes sense. And there is a
little bit of a blur there between those two because
most of them do both. Now you have the purists
where some will be fee only comprehensive financial planners. And
that's all they do. And they don't bring the investment
management in. And if your primary need was a comprehensive
(16:02):
financial plan I would start with that planning. Financial planning.
If you need mainly investment management assistance, but you're also
looking for somebody that will consider the rest of your
financial life and perhaps even either do a comprehensive plan or,
you know, help you identify other areas of need as
(16:24):
they look across the totality of your financial situation. I
would start with that investment category and what you will
probably end up with is an investment advisor who also
does financial planning as a part of their services. So
from what I'm hearing, just given that you've got these
(16:45):
beneficiary checks coming and you're going to need some investment management,
I would probably lead with the investment management, which is
someone who's going to focus specifically on managing your portfolio,
choosing the investments, rebalancing, risk management, tax efficiency. That's one
slice of the financial planning pie. It's not the whole pie.
(17:06):
And if you also wanted that individual to provide you
with a comprehensive financial plan, looking at the other areas
in depth like retirement planning, like tax efficiency, you know,
some of those other areas planning for college, uh, you know,
spending plans, those types of things. Then usually that would
be an add on service that most investment professionals would offer.
(17:31):
But it sounds like you would want to lead with
the the investment category, not the planning category.
S4 (17:36):
Correct.
S1 (17:38):
Yeah.
S4 (17:39):
Okay.
S1 (17:40):
And so once you get in there, find a professional
choose investment category. Um, you know, you'll get a list
of professionals. And then as a part of that interview process,
I would want to understand the full scope of their services,
whether that includes comprehensive planning, whether there's a separate charge
for that or it's included as a part of the
(18:00):
assets under management fee. You know, those types of things
would be part of the discovery process.
S4 (18:07):
Okay. All righty. Okay. That's good. Yeah. And I do, uh, um, well,
while I'm online, um, just want to share how I
appreciate how level headed you are. Um, I mean, I
know I've heard programs where the same question is asked
(18:28):
over and over again, and. you graciously answer it. Even keeled,
I'd probably get frustrated. So.
S1 (18:38):
Well thank you. I'll tell you. You know, for me,
and I don't just say this, it's a privilege to
be invited into people's stories each day. And although, you know,
there's only so many investing or financial categories of questions, uh,
you know, each person has a little bit different situation
and wants to know, how does this apply to me? Uh,
(18:59):
even if you, you know, answered a general question around
this topic three days ago. So, uh, I try to
understand that going into it, but I appreciate you calling
that out. Thank you for your kind remarks, sir. And, uh,
call anytime. Uh, let's head to Florida. Andrew. Go ahead.
S5 (19:14):
Yeah. Oh, no, it's just asking question.
S1 (19:18):
Go right ahead. Andrew, are you with us?
S5 (19:23):
Thanks for. Yes. Can you hear me?
S1 (19:24):
Okay, good, I sure can. Yeah.
S5 (19:27):
Yeah. Hey, Rob. thanks for taking my call. Um, I
was just calling and asking. Uh, this year, I'm in
my low 30s, have three kids. Just recently paid off
my house. Um, only $5,000 in debt. Have about 25,000
in savings. I was thinking about, um, saving for starting
to save for my three kids. I was thinking about
(19:48):
opening custodial accounts for them. I was just wondering, is
that the best way to to go about it?
S1 (19:54):
Yeah. Well, first of all, well done. Uh, it sounds
like you're in great shape here. The fact that you
already own your home, you've got that healthy emergency fund. Now,
we're moving beyond kind of the, uh, the basics of
that financial foundation and even thinking about being proactive for
the kids, which, you know, if you could get started
now and seed some accounts, you know, obviously, just given
(20:15):
the number of years you have to let that compound,
that could be fabulous. Um, I'm assuming you don't want
to earmark this specifically for college, is that right?
S5 (20:24):
Uh, correct. I was thinking more either for their retirement
or possibly to help them buy a home.
S1 (20:30):
Yeah, yeah. Good. So, you know, if they have earned income, either,
you know, you have a small business and you're able
to legitimately bring them on to do some work and
pay them accordingly. And, you know, if you stay under,
let's say, you know, 12,000, you could pay them and
it would be tax free because it'd be under the
standard deduction. Or they just, you know, have their own
(20:50):
job working part time retail or mowing lawns or something,
you know, then you could get money into a Roth
IRA for them up to the amount of earned income
they have or $7,000. And the nice thing about that
is the initial contributions can always be taken out at
any point, not the gains, but the initial contributions. With
(21:12):
regard to money you wouldn't want to earmark for retirement,
I would say I'd probably keep that in just a
straight brokerage account in your name, rather than putting it
in the custodial account, because with the custodial account it
automatically becomes their asset at the age of majority. And
that's usually 18. And you may not feel like they're
(21:32):
ready for it spiritually or just financially. And if that's
the case, you wouldn't have a choice but to give
it to them for whatever they wanted. But if you
keep it in your name but earmarked for them, perhaps
even a separate account for each child, you can let
it grow and you can choose the time and the
place you give it to them. Let's talk more after
the break. Stay right there. We'll be right back. Great
(21:58):
to have you with us today on Faith and finance live.
Before the break we were talking to Andrew in Florida.
Andrew is doing great in terms of, uh, he's out
of debt. Basically, he owns his home. He's, uh, saving
for retirement, has a healthy emergency fund, is now wanting
to put some money aside for his kids and for
(22:19):
them to have for their future, perhaps, uh, you know,
buy a first house or something like that. Uh, and, Andrew,
I was saying you could certainly, if they have earned income, uh,
we didn't talk about their ages so that they may
be too young for that. But if not, you could
start putting money in a Roth, which would be great. Uh,
apart from that, I'd keep that in your name, earmark
it for them, get it invested in some good, high quality,
(22:41):
good diversified mutual funds. Um, you would know it would
be for them, but that would allow you even though
you don't get any tax benefits, you'd pay taxes as
capital gains along the way. You'd have the opportunity to,
you know, choose the time and the place that they
actually receive the money. And you may decide, you know,
that's not necessarily on the same birthday for each child,
(23:03):
just depending upon their spiritual and financial maturity. But give
me your thoughts on all that.
S5 (23:09):
Um, yeah. That's kind of why I was asking as well,
is because, you know, hopefully you train them up in
the way that they should go and, you know, then
they'll know how to manage money correctly. But yeah, um,
they're not they're not at the working age now, so
I wouldn't be able to put in that. But but yeah,
that definitely helps. Maybe, you know, opening separate accounts in
(23:31):
my name for them.
S1 (23:33):
Yeah. Good. I like that. And the nice thing is
at a Fidelity or Schwab, I mean, those accounts would
basically be free. And then you could just set up
an automatic transfer in there. You could use a robo
advisor like the Schwab Intelligent Portfolios, or you could pick
the funds yourself. But in either case, you basically, you know,
can start with as little as you want. And then
just whenever you got some extra money, drop it in,
(23:55):
get it invested, and just let it grow and you'll
have a nice nest egg when the time comes to
think about handing it off to them.
S5 (24:03):
All right. Well, thank you for all the advice.
S1 (24:07):
Absolutely. We appreciate your call today. Thanks for being on
the program. Uh, let's go to Cleveland. Carol. Go ahead.
S6 (24:15):
Hi, Rob. Nice talking with you today. Um, you.
S1 (24:19):
As well.
S6 (24:19):
That you take my call. I have a question regarding saving. Um,
I've not been very good. Um. About that. I used
to say, like, just a little, at least like $5.
And then I try to go up to 25. Now
I'm trying to go bigger, like 100 to 200. I
have a better job, but I find myself. I get
paid like, you know, biweekly, twice, twice a month. And
(24:44):
I find myself before my next check comes. I'm taking
out of my savings, almost always, all of it just
about and spending it again. So I'm not really saving.
I don't know how to get myself to keep that
money in the savings. And I was wondering if you
had any suggestions that would make me a better steward
(25:05):
with my money.
S1 (25:06):
Hmm. Yeah, I appreciate that. It's a great question, you know,
and I love the direction you're headed here because, you know,
as you said, you know, you're getting to a place where, uh,
you know, you have more going in. And so, you know,
we're doing the right things here. You know, you started
out by just saving something. And that's a that's a
(25:26):
great place to be. Um, and now here you are.
You know, being able to increase that, um, what is
the challenge you're finding? Is it, you know, that you, um,
you know, just find that you always have a use
for the money, and it doesn't last. Uh, what is
it that's tripping you up?
S6 (25:47):
That seems to be most of it. Yes. It's not
like I'm really spending it on things I don't need.
Such as, you know, like a ring or anything like that.
Maybe I get more groceries that maybe I could have
done without and minimize that. You know what I'm saying? Um,
maybe it's, uh, extra, extra gas, but I, I, you know, like,
(26:07):
I mean, that I need in the car, but I'm
just doing it. And before I know it, I think, well,
I'm just going to use a little of it. Before
I know it, I've used all of it. And I
look back and I go, now, what in the world
did I spend it on? And can I take anything back?
Because I shouldn't have done that and I just did
it again. I find myself repeating this behavior and, um,
(26:29):
I don't want to repeat this behavior anymore. And I
try to say to myself, why am I doing this?
Like it's helping myself. Okay, this is my savings. I'm
not touching it this time. I'm not going to touch it.
But I do it. And I don't know what's causing
me to cross that line. What the barrier is that
I can't seem to be more responsible than like I should.
(26:52):
And I'm old enough to be responsible, but I'm not
doing it. And I don't know what factors really playing
the biggest part of why I can't. Maybe should I spend,
you know, save less, you know. But I try to
put more in there so I can pull out, you
know what I'm saying? But, um, yeah, I don't know. Well,
I really don't know how to handle it.
S1 (27:14):
Well, I appreciate that. Yeah. Thanks for your transparency there.
I mean, the starting place is to really get a
well thought out spending plan that isn't just a best
case scenario, but but truly, you know, relies on your
actual spending habits. So starting with those knowns, the things
you get a bill for, but then getting in, you know,
(27:35):
all of those other things you spend money on. And
maybe you take the next 30 days and carry a
little notebook around with you. Or you could use the
VI app as well for this, but you really want
to capture everything you're spending money on and get it
all in one place and see, you know, are you
truly living beyond your means? Because you may find that
you're are you are when you kind of understand all
(27:55):
those leaks, if you will, the places where the money
is disappearing, you know, and it's those little leaks, the
meals out and the impulse buys and the things like
that that you need to identify. Because until you know
what you're actually spending, you can't really make any decisions.
And then it's a matter of saying, okay, I'm really
going to begin to, uh, you know, turn this into
(28:16):
a spending plan that balances, that has cushion and margin. Um,
but it has all the extra things in it. Um,
you know, if you're going to buy gifts, then you
got to have a gifts category. If you're ultimately going
to spend money on Christmas, you got to have a
Christmas category. You know, I mean, those things that we
don't tend to we don't get a bill for. And
so therefore they're not top of mind, but they end
(28:37):
up happening on a regular basis. And then you've got
to create guardrails around them. Um, you know, so that
means having some sort of system to control the flow
of money. And if you have a problem area, maybe
you use cash for that. You know, if dining out
or shopping is your weakness, then whatever that amount is
you have for that category, literally take that cash at,
(28:58):
you know, at every paycheck and put it into an
envelope for the week. And when it's gone, it's gone.
And that's a built in stop sign that's going to,
you know, cause you to curb your spending. At that point, um,
you could find accountability, you know, share your goals with
a friend or somebody that you know would be willing
to be, you know, accountable, allow you to have some
(29:19):
accountability there. But I think at the end of the day,
you've got to understand what is the driver of this?
Is it when I'm discouraged, I spend money? Is it
that I'm trying to use the spending to kind of
fill a need that I have that ultimately should come
from satisfaction in the Lord? You know, do you need
to spend more time renewing your mind in God's Word?
(29:40):
You know, those are all things I think that can
be helpful. But in terms of the mechanics of this,
I think you've got to go, you know, get that
realistic spending plan in place, decide what you're going to
cut back on to truly balance the budget. And then
you've got to put the the curbs in place, like
the cash envelope system that is going to actually cause
(30:04):
you to stop when the money's gone for any particular category,
especially the categories that are creating the most problems. Does
that make sense?
S6 (30:12):
Yeah, that might work. That might work because I used
to not have a budget. Like I would just say, okay,
I need this or this and this. Now I have
actually I have budget sheets, but I make them out
month to month.
S1 (30:24):
Yeah. Well, and they're only as good as their ability
to be used and followed. And it's no good if
you get to the end of the month and say, well,
I messed up again. All right, let me try again
at the next month, that actually doesn't help you. You've
got to create a, a system to control the flow
of money that's actually going to curb the spending when
the money's gone. So you don't continue to spend beyond that.
(30:46):
And I think that's where the cash envelope system can
work for you. Carol, thanks for your call. Hey, thanks
for joining us today on Faith and Finance Live. Coming
up in just a few moments, Jerry Boyer will be
by we'll get Jerry's take on the markets and the economy.
But first, Terry's been waiting patiently in Maryland. Terry. Terry.
(31:09):
Go ahead. Terry. Are you with us? Oh, there you are.
Go right ahead.
S7 (31:16):
I have a military adult son who's looking to buy
a house and needs some help with financing. Um, what
are my options as far as gifting? He's talking about
an intra family loan through the IRS.
S1 (31:33):
Okay. Uh, yeah. Several thoughts on that. One is he's
probably talking about the annual gift exclusion, which just basically
says that any one person can give any other individual
up to $19,000. That's the 2025 number without reporting that
to the IRS. So you can give as many people
(31:55):
as you want 19,000. Don't tell the IRS about it.
If you're married, you could give twice that. You could
each give 19 a total of 38. Um, if you
go beyond that doesn't mean it's taxable. You just have
to report it on gift tax form 709, and that
would chip away at the lifetime exemption of gifting, which
happens to be today more than $13 million. So you'd
(32:16):
have to give a lot of people a lot of
money before you'd ever get anywhere close to that being
a tax issue. Um, but that may be what he
is referring to. But I guess the bigger question is why?
Why an intra family loan? I don't love the relational
impact of that. And if he's a service member, if
he's in the military, I mean, he has access to
(32:38):
some pretty phenomenal financing through the VA that doesn't even
require a down payment, although I don't recommend that. So
why the need to work through the family?
S7 (32:50):
I think he just wants to document regarding the interest,
doesn't want to take advantage.
S1 (32:57):
Well, right. So are you giving him a gift or
are you giving him a loan?
S7 (33:02):
He wants me to give him a loan.
S1 (33:06):
And why is that? Why not just run all of
that through a conventional lender, lender, or the VA? If
you're not giving him a gift, why involve you at all?
S7 (33:18):
Oh, that's a good question. I'm not sure.
S1 (33:21):
Yeah, okay. See, I would think through that. I mean,
it's one thing if you want to give him a
gift and you have the financial ability to do that
and you want to help him, you know, get started
with this home purchase and contribute toward the down payment,
that'd be great. And again, if you did up to 19,000,
you don't have to tell the IRS if you go
over it, you do. But it's still not taxable. It's
not it's not an issue. But the moment we start
(33:44):
to give loans to family members, I mean, the Bible
says describes the borrower lender relationship as master slave. It
it changes the relationship. And if for some reason he
couldn't pay, it's going to cause relational strain. And so
I would you know, I would advise you either make
a gift if it's within your means or, you know,
(34:04):
let him get a traditional or what you would call
a conventional loan or because, again, he's in the military,
he has access to VA financing. That's very lenient in
terms of how you qualify for it and how much
down payment you need to have, which just gets you
out of being his lender altogether, which I would recommend.
S7 (34:26):
Okay, great.
S8 (34:27):
Okay. Thank you very much. You're welcome Terry.
S1 (34:29):
Lord bless you. Thanks for calling today. Well, Jerry Boyer's here. Jerry.
A lot going on in the markets today. Looks like, uh,
we're Finnish, uh, green across the board here. Uh, we've
got inflation readings. We've got a new, uh, Q2 GDP.
Where do you want to start?
S9 (34:45):
Uh, let's go in that order, uh, inflation readings, uh,
markets up, inflation readings. Let's go. Let's go backwards order.
Because that's how the cause worked. Uh, we got a
new GDP number. Um, the second quarter, um, the economy
grew 3.8% annualized. It didn't grow 3.8% in three months.
You take the amount for three months and then you
multiply it by four, and that's 3.8%. Uh, and um,
(35:09):
that's not bad. I mean, that's like, you know, below,
excuse me, that's above average for the long term for
the American economy. Now, the quarter before that, it was negative.
It shrank. Uh, so that means that sort of year
to date, it's still a little subpar. So what's going
on there? Well, we were really heavy in the trade
war in the first quarter. And by the second quarter
we were doing a lot of, well, maybe we won't
(35:32):
have a trade war. And oh, they're coming in, they're
negotiating and we're dropping their you know, they're dropping their
tariffs on us and we're dropping tariffs on them. And
so a lot of that trade war stuff was kind
of off. And a lot of that uncertainty kind of
cleared up. Not all of it. It's still it's still
going on today. Uh, there was just one today about 100%
tariffs on importing certain pharmaceuticals, which I don't think is
(35:53):
moving the market that much because I don't think anyone
thinks it's going to stay. Um, and that's one of
the problems with tariff tweeting. Eventually people stopped believing you. Um,
so I think so. What? What's the effect of that
on the market? Well, it means the economy is doing
better than expected. Uh, and if the economy is doing
better than expected, let's let's enter into fed mind here.
(36:14):
The fed thinks that growth causes inflation. Uh, it doesn't,
but it thinks it does. Um, and so if we're
if we're if we don't if we have this growth, then, um,
you know, then, you know, we have a situation where
maybe the, maybe the central bank won't cut rates so much.
So in the middle of the week, the good news
(36:35):
of the economy was bad news for markets, right? Because
if the economy is growing at 3.8%, maybe it'll overheat.
Maybe it'll cause inflation. So like in the middle of
the week, markets were down. Then today the inflation number
turned out to be about what people expected. And so
it's like oh okay. Well inflation hasn't heated up that much.
So the fed can cut rates. So today the market
(36:57):
switched into green because they thought, well, we're back to
the fed cutting rates. Uh, and there's a probability market
where you can see, you know, what investors think the
fed is going to do. And they believe we're going
to get a rate cut in the next meeting and
in the meeting after that. So we're seeing once again,
the central bank is in charge of the markets. Um,
(37:19):
I think that's something we need to take into account
when we're analyzing markets. I don't think that's the way
it's supposed to work. I don't think that's what the
founders had in mind for their design. And I don't
think it's what the creator had in mind for the design.
I think the creator designed the world so that financial
wealth would go up when we're more productive, uh, and
go down when we're less productive, not go up when
(37:42):
we think the central bank is going to debase the currency.
But we live in the world, not of policymakers who
are following the biblical design. We live in the world
of policymakers who manipulate markets in order to get certain outcomes,
rather than letting the economy letting rather than letting us
set interest rates by our behavior. So you just had
(38:03):
a Terry was just on there and I guess she's
a saver, right? So she can lend money to her son.
I thought you gave great advice there, by the way. Hey,
watch out when you're lending money to your son. But
so let's say she lent money and they send it
and they set an interest rate. Well, that would be
an interest rate set between them. Or he goes to
the bank and then that interest rate would be set
by how many people are saving in the bank versus
(38:24):
how many people are borrowing from the bank. So we
would set the interest rate. And if we're a saving society,
the interest rate would be lower. There'd be abundant credit
if we were not a saving society. If we were
a borrowing society, then interest rates would be higher. It
would reflect the fact that we're borrowers that were short
term thinkers. Um, and that's the interest rate's supposed to
be set that way, and it's supposed to tell us
(38:45):
who we are. It's like a mirror that we look in.
The problem is that Keynesian economics says we don't. You
don't want to look in the mirror. You don't want
to see the reality. We're going to lower interest rates.
It's like a skinny mirror. We're going to lower interest
rates and make it look like we're people who can
afford to spend more, because lowering interest rates will pump
money into the system. We'll have all that extra money
and then we'll spend it, because spending drives the economy,
(39:06):
thought Keynes, and thinks everybody who runs fed policy, um,
you know, so we want to get people to spend
because that causes prosperity. And so that's why they're pumping
money into the system to get people to spend, because
they think that's going to stimulate the economy. By the way,
the president thinking a little bit Keynesian himself when he
keeps pushing for lower interest rates, um, and I think
(39:28):
he's selling himself short. I mean, if his big, beautiful bill,
which is now a large, lovely law, is everything he
promises and so good for growth, then why in the
world do we need to force down interest rates? Why
do we need to pump new money into the system?
Let let the policy play itself out and give us
the golden age based on market forces rather than a
gold age Golden age based on pressuring the fed to
(39:49):
pump money into the system.
S8 (39:51):
Yeah.
S1 (39:52):
And the reality is, even though the inflation number was
as expected, it's still not where we want it to be, right?
S9 (39:59):
Right. It's not even where the fed is supposed to
want it to be. And you know where I want
it to be. Zero.
S8 (40:05):
Zero. Yeah.
S9 (40:06):
I mean, I read the Bible. It says unjust weights
and measures are an abomination to the Lord. I take
that seriously. Uh, so I don't think there should be
any debasement of currency. I guess I'm a little strict
on that compared to at least the people who are
policy makers. So the fed said, well, what we want
is 2% purchasing power loss per year. We want we
want your your the value of your dollar to only
(40:28):
go down 2% a year. So if it's $100 off,
$100 only buys what, 90? You know, if it buys what, $98,
I think I have that wrong. It takes $100 to
buy what 98 used to buy before? That's good. All right.
I think it should. I think $100 should be $100
for 100 years. Um, and the prices should maybe fall
(40:48):
a little bit, but they set their inflation target at 2%.
The inflation target, the inflation number came in at 2.9%,
which is above that. So it shows how much we've
let things drift. We said zero inflation is too low.
We're going to make it two. And now we've gotten
to the point where oh well 2.93. That's okay. We'll
(41:11):
probably cut rates anyway. We'll probably create money. So we've
become very tolerant of inflation. We've become very tolerant of
what I'm going to say. The Bible calls an abomination
unjust weights and measures. Markets are up because they understand
that we're tolerant of that and that even though inflation
is almost 3%, the central bank is still going to
(41:31):
lower interest rates. It's still going to create new money
out of thin air. It's still going to pump that
money into the system, and it's going to pump it
in through markets. And that's why markets are the thing
that go up first.
S8 (41:42):
Yeah.
S1 (41:42):
Very good. Jerry, when it comes to, uh, you know, immigration,
I'm just curious in your thoughts. I'm seeing, uh, news
article here that apparently the Trump Gold card, the pathway
to a speedy residency has been cut from 5 million
to $1 million. Do you do you like that? Do
you like that strategy?
S9 (42:04):
Do I like the cutting it from 5 million to
1 million? Or do I like the existence of of
being able to buy citizenship?
S8 (42:10):
Which one buy citizenship?
S9 (42:12):
Not crazy about it. I think the citizenship is about
loyalty and allegiance. That's how the Constitution presents it. I
think we ought to stick with that.
S8 (42:21):
Yeah.
S1 (42:22):
Very good. Makes sense. All right, Jerry, as always, we
appreciate your insights, sir.
S9 (42:27):
And yours.
S8 (42:28):
Alright.
S1 (42:28):
God bless you, buddy. That's Jerry Bowyer. He's our resident economist.
He joins us each Friday on the program. Always great
to have him with us. Always educational. Hey, thanks for
being along today. Faith and Finance Live is a partnership
between Moody Radio and Faith five. Big thanks to my
team Josh, Jim, Omar and Tahira. Everybody here at Faith five.
We'll see you next time. Bye bye.
Have you ever noticed how unexpected expenses always seem to
show up at the worst time? Hi, I'm Rob West.
The truth is, most of these costs aren't surprises at all.
We know cars will break down, homes need repairs, and
Christmas comes every year. Today we'll talk about how sinking
funds can help you prepare with wisdom instead of panic.
(00:30):
And then it's on to your calls at 800 525 7000.
That's 800 525 7000. This is faith and finance. Live.
Biblical wisdom for your financial decisions. Scripture has a lot
to say about this kind of preparation. Proverbs 2120 reminds us,
(00:51):
precious treasure and oil are in a wise man's dwelling,
but a foolish man devours it. Wisdom means setting aside
resources now instead of consuming everything immediately. One simple way
to do this today is by using sinking funds. A
sinking fund is money you set aside gradually for a
future expense. Instead of panicking at a $1,200 Christmas bill,
(01:14):
you can save 100 per month all year. Instead of
reaching for a credit card when your car needs new tires,
you draw from the fund you've been building. It's not glamorous,
but it provides peace of mind and freedom from debt.
This mirrors the principle Joseph applied in Genesis 41. When
warned of famine, he set aside one fifth of the
(01:35):
grain during years of plenty. His preparation was not random.
It was systematic and consistent. Sinking funds are the same. Disciplined,
steady contributions toward needs we know will eventually arise. Another
biblical picture is found in Proverbs six six through eight.
Go to the ant, O sluggard. Consider her ways, and
(01:55):
be wise without any chief officer or ruler. She prepares
her bread in summer and gathers her food in harvest.
God holds up the ant as an illustration of diligence. Why?
Because she doesn't wait until the snow falls to collect grain.
She steadily prepares during harvest season. Preparation in the present
(02:15):
leads to provision in the future. You may ask, but
isn't trusting God enough? Shouldn't I just pray when an
expense comes and rely on him to provide? We have
to remember that trusting God never means neglecting stewardship. Throughout Scripture,
trust and planning go hand in hand. Noah trusted God,
yet he still built the ark. Farmers trusted God, yet
(02:37):
they still sowed seed. Joseph trusted God, yet he still
stored grain. Faith is not passivity, it's obedience expressed in
wise living. Setting up sinking funds isn't a lack of faith,
it's a demonstration of it. It recognizes that God provides
resources today to prepare for tomorrow. So where should we start? Well,
(02:59):
consider expenses that are inevitable, but irregular. Common categories include
car repairs and replacement. You may not know when, but
you do know the repair shop will eventually call your name.
Home maintenance, whether it's a leaky roof, worn out furnace,
or broken appliance, homes require care. Medical costs, co-pays, and
(03:20):
deductibles always come around. Gifts and holidays. Birthdays and Christmas
are not surprises. They fall on the same day every year.
Insurance premiums or taxes, if paid annually or quarterly, sinking
funds break them into small, manageable pieces. Think of sinking
funds as Joseph's storehouses. They don't need to start big.
(03:41):
Consistency matters more than amount. Even setting aside just $25
a month builds margin over time. The New Testament shows
the same mindset in one Corinthians 16 two. Paul urged
believers to set aside money regularly in proportion to income
to meet the church's needs. That's essentially a spiritual sinking fund.
(04:01):
Planned systematic stewardship is a biblical habit, not only forgiving,
but for household provision. Of course, we must balance preparation
with perspective. Jesus warned in Luke 1216 to 21 against
hoarding wealth for ourselves. The goal is not to stockpile,
but to steward resources so we can live responsibly and freely.
(04:24):
Bless others. A sinking fund isn't about building treasures on earth.
It's about positioning ourselves to walk wisely while keeping our
hearts focused on God's kingdom. Here's a practical place to start.
Choose just one category. If you've never saved this way,
begin with Christmas. Break the cost into monthly pieces and
start setting aside now. Once the habit is established, add
(04:47):
a second fund like car repairs or medical expenses. Over time,
you'll have a system that turns stress into intentional planning.
In the end, creating sinking funds is more than a
budgeting trick. It's discipline and practice. It's the daily choice
to trust God by stewarding his provisions carefully, planning not
(05:07):
out of fear, but out of faith. With each small deposit,
you build not only financial stability, but also a testimony
of wisdom and obedience. So start planning today and build
sinking funds for the future. All right, your calls are next.
800 525 7000. We'll be right back.
S2 (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.
S3 (05:58):
Great to have you with us today on Faith and
finance live. I'm Rob West, looking forward.
S1 (06:01):
To taking your calls and questions today. That number to
get in on the conversation is 800 525 7000. Again
that number 800 525 7000. We'd love to tackle whatever
is on your mind today and we will do that
when you call. Lines are filling up but they're open
at the moment. So go ahead and call right now.
Coming up in our final segment today, Jerry Bowyer stops
(06:23):
by and it's a good time to hear from Jerry
on the markets. The markets are up across the board
today at least the Russell 2000. The Nasdaq, the S&P 500,
which snapped a three week, uh, winning streak. We saw that,
uh the Dow rising 300 points today after an in-line
inflation report. We'll get Jerry's take on all of that.
(06:45):
But alongside those other metrics of the economy is the, uh,
the fact that the US economy grew faster this spring
than anyone expected. Uh, that posted its strongest performance in
nearly two years. A new government report shows that gross
domestic product expanded at 3.8% annualized in the second quarter
(07:08):
of 2025. That's up from earlier estimates of 3.3%. And again,
that marks the biggest quarterly gain since late 23. Here
are a few details of that revised report. First of all,
consumer spending rose at 2.5% annualized. That's stronger than first thought.
Business investment grew. That was led by equipment and intellectual
(07:30):
property imports fell, which effectively boosted GDP because imported goods
are subtracted from the total. Now, on the surface, this
sounds like all good news. It's worth remembering that much
of that growth came from household spending. So remember, as stewards,
we're called to live wisely with discipline, saving and having
(07:51):
plenty of generosity to go along with it. So our
growth reflects God's wisdom, not just consumer demand. Bottom line
stick to your budget, but all in all, a pretty
good report. We'll get Jerry's take on that in the
final segment today. All right. Let's dive into your questions again.
If you want to be a part of the conversation today,
go ahead and call right now 800 525 7000. We're
(08:15):
going to begin in Indiana today. Randy go ahead.
S4 (08:19):
Yes. Hello. How are you doing?
S1 (08:21):
I'm doing great. Thanks for your call, sir.
S4 (08:23):
Certainly. Um. I'm calling. Uh, first of all, I've got
a couple of questions. First question is, I'm just kind
of wondering how, if at all, um, investing affects, uh,
prices since, uh, companies are trying to give a return
on investment.
S1 (08:44):
Hmm. Yeah. So you're talking about inflation basically.
S4 (08:51):
Possibly, yeah I guess. Yeah. I mean that's definitely the,
the term. But uh, when I looked it up it
said inflation affects investing. But I'm just wondering if it
goes the other way around.
S1 (09:02):
Yeah. Um, sure. Well, you know, I think I mean,
first of all, inflation is when the prices of goods
and services rise broadly across the economy. And that's usually
driven by. And you'll remember this from economics, uh, you know,
too much money chasing too few goods. Um, and so
that leads to rising costs. Um, you know, with regard to, uh, investment, um,
(09:28):
you know, the at the end of the day, uh,
investment is, you know, we're putting capital to work inside businesses, uh, we're,
you know, providing them capital to provide their goods and services. Um,
you know, short term when people invest. So stocks, bonds,
retirement accounts that money isn't being spent in the real
(09:51):
economy because, you know, it's not chasing goods and services
which generally does not cause inflation. Um, ultimately, long term
investment can actually reduce inflation pressure because companies use that
investment capital to expand and hire and innovate. And so
that means more goods and services with less upward pressure
(10:15):
on prices. Um, but, you know, if investment were to fuel,
let's say, a speculative bubble. So think the.com of 2000
housing prices in oh seven and oh eight, you know,
it can create asset inflation because the prices of, of
stocks or real estate rises and that uh, but that's
(10:36):
different from consumer price inflation. So I would say at
the end of the day, um, you know, Inflation, um,
you know, related to investing is generally not a result
of investment because those dollars aren't being spent at the
grocery store or the gas pump. They're going into companies
to grow. And again, that helps in fight inflation over
(11:00):
time because we're increasing supply and productivity. Uh, at the
end of the day. And the real driver of inflation really,
as I said is is too much demand for goods,
which leads to rising costs or, you know, more money
being printed, not people putting money in their four one
or ultimately in stocks and bonds, if that makes sense.
S4 (11:22):
Yes it does. Okay. Makes sense. Uh, my next question, um,
I have received and still receiving some beneficiary checks and
thinking to invest. And I've gone to fe fi.com and
looking for Kay. And there's the investing and the planning.
(11:46):
And I'm just curious as to which, uh, certification would
be more appropriate for investing.
S1 (11:55):
Yeah. Yeah. Um, you know, typically what you will find is, um,
you know, if somebody has the cash and they're showing
up in the investing directory, which basically just means when
you go to faith. Com and you do a search
for a K, it's going to ask you which of
the disciplines you want to find a K in. And
(12:17):
you know, they have to go through the coursework and
pass the proctored exam. And everybody you know has to
do the, uh, integrity requirements and ethics and, you know,
regulatory review. But to be able to be published to
the various directories, whether that's financial planning or investments or
even tax and accounting, they each have their own requirements.
So in the Investment area, it would require at least
(12:41):
ten years experience. Um, you know, serving clients with investment
advice or one of the appropriate designations. Now, you know,
the most notable designation specifically around investing is the CFA
Chartered Financial analyst. But that typically skews toward those professionals
who are actually analyzing companies, you know, and making strategic
(13:05):
decisions about portfolio construction. Not usually wealth managers who are
the client facing investment professionals. Often they might have the
CFP designation, which is known more so for the planning side,
but does cover a pretty good amount on investing. Um,
so I would say in terms of what you're looking for,
anybody that shows up in the directory that qualifies to
(13:29):
be in that particular directory for those looking for investment advice,
would have our confidence that they have, you know, met
the requirements to be able to provide sound investment advice.
Some of them will have gone to earn the CFA.
Many will not. But ultimately, you know, we would feel
like they would be able to bring you the kind
(13:50):
of advice you need on the investment management side. So
there's not an obvious designation in the investment space like
there is in the planning space with CFP. But, you know,
we would feel confident that if they're showing up in
that directory, they've met the criteria. Does that make sense?
S4 (14:08):
It does. Um, but still not feeling. It's answering the
question of whether it ought to be investing or planning.
S3 (14:18):
Got it. Okay. Let's talk about that after.
S1 (14:20):
The break, and we'll dial in to what you need
in your situation. Stay right there, Andy. We'll be right back.
Great to have you with us today on Faith and
finance live here on Moody Radio. I'm Rob West. We're
taking your calls and questions. Before the break, we were
talking to Randy about investing and specifically how to choose
(14:44):
an advisor to help with investing. And Randy's wondering about
the difference between investing and financial planning. And, Randy, are
you just to make sure I understand the question? Are
you wondering which type of professional you need based on
your situation, or you know what you need? You're just
wondering the appropriate designation to go with each help. Help
(15:05):
me make sure I'm answering the question appropriately.
S4 (15:08):
Well, um, let's see. So, uh, I'm just seeing the
there's the category of planning and the category of investing. Yes. And, uh,
as I mentioned, I'm receiving beneficiary checks, and I don't
have to utilize it and kind of don't want to, uh,
I would like to just go ahead and invest it.
(15:31):
And so just it seems like there's a nuance between
the planning and investing. And yeah, just which, as I
mentioned earlier, the certification. That would be better.
S1 (15:41):
Got it. Yeah, that makes sense. And there is a
little bit of a blur there between those two because
most of them do both. Now you have the purists
where some will be fee only comprehensive financial planners. And
that's all they do. And they don't bring the investment
management in. And if your primary need was a comprehensive
(16:02):
financial plan I would start with that planning. Financial planning.
If you need mainly investment management assistance, but you're also
looking for somebody that will consider the rest of your
financial life and perhaps even either do a comprehensive plan or,
you know, help you identify other areas of need as
(16:24):
they look across the totality of your financial situation. I
would start with that investment category and what you will
probably end up with is an investment advisor who also
does financial planning as a part of their services. So
from what I'm hearing, just given that you've got these
(16:45):
beneficiary checks coming and you're going to need some investment management,
I would probably lead with the investment management, which is
someone who's going to focus specifically on managing your portfolio,
choosing the investments, rebalancing, risk management, tax efficiency. That's one
slice of the financial planning pie. It's not the whole pie.
(17:06):
And if you also wanted that individual to provide you
with a comprehensive financial plan, looking at the other areas
in depth like retirement planning, like tax efficiency, you know,
some of those other areas planning for college, uh, you know,
spending plans, those types of things. Then usually that would
be an add on service that most investment professionals would offer.
(17:31):
But it sounds like you would want to lead with
the the investment category, not the planning category.
S4 (17:36):
Correct.
S1 (17:38):
Yeah.
S4 (17:39):
Okay.
S1 (17:40):
And so once you get in there, find a professional
choose investment category. Um, you know, you'll get a list
of professionals. And then as a part of that interview process,
I would want to understand the full scope of their services,
whether that includes comprehensive planning, whether there's a separate charge
for that or it's included as a part of the
(18:00):
assets under management fee. You know, those types of things
would be part of the discovery process.
S4 (18:07):
Okay. All righty. Okay. That's good. Yeah. And I do, uh, um, well,
while I'm online, um, just want to share how I
appreciate how level headed you are. Um, I mean, I
know I've heard programs where the same question is asked
(18:28):
over and over again, and. you graciously answer it. Even keeled,
I'd probably get frustrated. So.
S1 (18:38):
Well thank you. I'll tell you. You know, for me,
and I don't just say this, it's a privilege to
be invited into people's stories each day. And although, you know,
there's only so many investing or financial categories of questions, uh,
you know, each person has a little bit different situation
and wants to know, how does this apply to me? Uh,
(18:59):
even if you, you know, answered a general question around
this topic three days ago. So, uh, I try to
understand that going into it, but I appreciate you calling
that out. Thank you for your kind remarks, sir. And, uh,
call anytime. Uh, let's head to Florida. Andrew. Go ahead.
S5 (19:14):
Yeah. Oh, no, it's just asking question.
S1 (19:18):
Go right ahead. Andrew, are you with us?
S5 (19:23):
Thanks for. Yes. Can you hear me?
S1 (19:24):
Okay, good, I sure can. Yeah.
S5 (19:27):
Yeah. Hey, Rob. thanks for taking my call. Um, I
was just calling and asking. Uh, this year, I'm in
my low 30s, have three kids. Just recently paid off
my house. Um, only $5,000 in debt. Have about 25,000
in savings. I was thinking about, um, saving for starting
to save for my three kids. I was thinking about
(19:48):
opening custodial accounts for them. I was just wondering, is
that the best way to to go about it?
S1 (19:54):
Yeah. Well, first of all, well done. Uh, it sounds
like you're in great shape here. The fact that you
already own your home, you've got that healthy emergency fund. Now,
we're moving beyond kind of the, uh, the basics of
that financial foundation and even thinking about being proactive for
the kids, which, you know, if you could get started
now and seed some accounts, you know, obviously, just given
(20:15):
the number of years you have to let that compound,
that could be fabulous. Um, I'm assuming you don't want
to earmark this specifically for college, is that right?
S5 (20:24):
Uh, correct. I was thinking more either for their retirement
or possibly to help them buy a home.
S1 (20:30):
Yeah, yeah. Good. So, you know, if they have earned income, either,
you know, you have a small business and you're able
to legitimately bring them on to do some work and
pay them accordingly. And, you know, if you stay under,
let's say, you know, 12,000, you could pay them and
it would be tax free because it'd be under the
standard deduction. Or they just, you know, have their own
(20:50):
job working part time retail or mowing lawns or something,
you know, then you could get money into a Roth
IRA for them up to the amount of earned income
they have or $7,000. And the nice thing about that
is the initial contributions can always be taken out at
any point, not the gains, but the initial contributions. With
(21:12):
regard to money you wouldn't want to earmark for retirement,
I would say I'd probably keep that in just a
straight brokerage account in your name, rather than putting it
in the custodial account, because with the custodial account it
automatically becomes their asset at the age of majority. And
that's usually 18. And you may not feel like they're
(21:32):
ready for it spiritually or just financially. And if that's
the case, you wouldn't have a choice but to give
it to them for whatever they wanted. But if you
keep it in your name but earmarked for them, perhaps
even a separate account for each child, you can let
it grow and you can choose the time and the
place you give it to them. Let's talk more after
the break. Stay right there. We'll be right back. Great
(21:58):
to have you with us today on Faith and finance live.
Before the break we were talking to Andrew in Florida.
Andrew is doing great in terms of, uh, he's out
of debt. Basically, he owns his home. He's, uh, saving
for retirement, has a healthy emergency fund, is now wanting
to put some money aside for his kids and for
(22:19):
them to have for their future, perhaps, uh, you know,
buy a first house or something like that. Uh, and, Andrew,
I was saying you could certainly, if they have earned income, uh,
we didn't talk about their ages so that they may
be too young for that. But if not, you could
start putting money in a Roth, which would be great. Uh,
apart from that, I'd keep that in your name, earmark
it for them, get it invested in some good, high quality,
(22:41):
good diversified mutual funds. Um, you would know it would
be for them, but that would allow you even though
you don't get any tax benefits, you'd pay taxes as
capital gains along the way. You'd have the opportunity to,
you know, choose the time and the place that they
actually receive the money. And you may decide, you know,
that's not necessarily on the same birthday for each child,
(23:03):
just depending upon their spiritual and financial maturity. But give
me your thoughts on all that.
S5 (23:09):
Um, yeah. That's kind of why I was asking as well,
is because, you know, hopefully you train them up in
the way that they should go and, you know, then
they'll know how to manage money correctly. But yeah, um,
they're not they're not at the working age now, so
I wouldn't be able to put in that. But but yeah,
that definitely helps. Maybe, you know, opening separate accounts in
(23:31):
my name for them.
S1 (23:33):
Yeah. Good. I like that. And the nice thing is
at a Fidelity or Schwab, I mean, those accounts would
basically be free. And then you could just set up
an automatic transfer in there. You could use a robo
advisor like the Schwab Intelligent Portfolios, or you could pick
the funds yourself. But in either case, you basically, you know,
can start with as little as you want. And then
just whenever you got some extra money, drop it in,
(23:55):
get it invested, and just let it grow and you'll
have a nice nest egg when the time comes to
think about handing it off to them.
S5 (24:03):
All right. Well, thank you for all the advice.
S1 (24:07):
Absolutely. We appreciate your call today. Thanks for being on
the program. Uh, let's go to Cleveland. Carol. Go ahead.
S6 (24:15):
Hi, Rob. Nice talking with you today. Um, you.
S1 (24:19):
As well.
S6 (24:19):
That you take my call. I have a question regarding saving. Um,
I've not been very good. Um. About that. I used
to say, like, just a little, at least like $5.
And then I try to go up to 25. Now
I'm trying to go bigger, like 100 to 200. I
have a better job, but I find myself. I get
paid like, you know, biweekly, twice, twice a month. And
(24:44):
I find myself before my next check comes. I'm taking
out of my savings, almost always, all of it just
about and spending it again. So I'm not really saving.
I don't know how to get myself to keep that
money in the savings. And I was wondering if you
had any suggestions that would make me a better steward
(25:05):
with my money.
S1 (25:06):
Hmm. Yeah, I appreciate that. It's a great question, you know,
and I love the direction you're headed here because, you know,
as you said, you know, you're getting to a place where, uh,
you know, you have more going in. And so, you know,
we're doing the right things here. You know, you started
out by just saving something. And that's a that's a
(25:26):
great place to be. Um, and now here you are.
You know, being able to increase that, um, what is
the challenge you're finding? Is it, you know, that you, um,
you know, just find that you always have a use
for the money, and it doesn't last. Uh, what is
it that's tripping you up?
S6 (25:47):
That seems to be most of it. Yes. It's not
like I'm really spending it on things I don't need.
Such as, you know, like a ring or anything like that.
Maybe I get more groceries that maybe I could have
done without and minimize that. You know what I'm saying? Um,
maybe it's, uh, extra, extra gas, but I, I, you know, like,
(26:07):
I mean, that I need in the car, but I'm
just doing it. And before I know it, I think, well,
I'm just going to use a little of it. Before
I know it, I've used all of it. And I
look back and I go, now, what in the world
did I spend it on? And can I take anything back?
Because I shouldn't have done that and I just did
it again. I find myself repeating this behavior and, um,
(26:29):
I don't want to repeat this behavior anymore. And I
try to say to myself, why am I doing this?
Like it's helping myself. Okay, this is my savings. I'm
not touching it this time. I'm not going to touch it.
But I do it. And I don't know what's causing
me to cross that line. What the barrier is that
I can't seem to be more responsible than like I should.
(26:52):
And I'm old enough to be responsible, but I'm not
doing it. And I don't know what factors really playing
the biggest part of why I can't. Maybe should I spend,
you know, save less, you know. But I try to
put more in there so I can pull out, you
know what I'm saying? But, um, yeah, I don't know. Well,
I really don't know how to handle it.
S1 (27:14):
Well, I appreciate that. Yeah. Thanks for your transparency there.
I mean, the starting place is to really get a
well thought out spending plan that isn't just a best
case scenario, but but truly, you know, relies on your
actual spending habits. So starting with those knowns, the things
you get a bill for, but then getting in, you know,
(27:35):
all of those other things you spend money on. And
maybe you take the next 30 days and carry a
little notebook around with you. Or you could use the
VI app as well for this, but you really want
to capture everything you're spending money on and get it
all in one place and see, you know, are you
truly living beyond your means? Because you may find that
you're are you are when you kind of understand all
(27:55):
those leaks, if you will, the places where the money
is disappearing, you know, and it's those little leaks, the
meals out and the impulse buys and the things like
that that you need to identify. Because until you know
what you're actually spending, you can't really make any decisions.
And then it's a matter of saying, okay, I'm really
going to begin to, uh, you know, turn this into
(28:16):
a spending plan that balances, that has cushion and margin. Um,
but it has all the extra things in it. Um,
you know, if you're going to buy gifts, then you
got to have a gifts category. If you're ultimately going
to spend money on Christmas, you got to have a
Christmas category. You know, I mean, those things that we
don't tend to we don't get a bill for. And
so therefore they're not top of mind, but they end
(28:37):
up happening on a regular basis. And then you've got
to create guardrails around them. Um, you know, so that
means having some sort of system to control the flow
of money. And if you have a problem area, maybe
you use cash for that. You know, if dining out
or shopping is your weakness, then whatever that amount is
you have for that category, literally take that cash at,
(28:58):
you know, at every paycheck and put it into an
envelope for the week. And when it's gone, it's gone.
And that's a built in stop sign that's going to,
you know, cause you to curb your spending. At that point, um,
you could find accountability, you know, share your goals with
a friend or somebody that you know would be willing
to be, you know, accountable, allow you to have some
(29:19):
accountability there. But I think at the end of the day,
you've got to understand what is the driver of this?
Is it when I'm discouraged, I spend money? Is it
that I'm trying to use the spending to kind of
fill a need that I have that ultimately should come
from satisfaction in the Lord? You know, do you need
to spend more time renewing your mind in God's Word?
(29:40):
You know, those are all things I think that can
be helpful. But in terms of the mechanics of this,
I think you've got to go, you know, get that
realistic spending plan in place, decide what you're going to
cut back on to truly balance the budget. And then
you've got to put the the curbs in place, like
the cash envelope system that is going to actually cause
(30:04):
you to stop when the money's gone for any particular category,
especially the categories that are creating the most problems. Does
that make sense?
S6 (30:12):
Yeah, that might work. That might work because I used
to not have a budget. Like I would just say, okay,
I need this or this and this. Now I have
actually I have budget sheets, but I make them out
month to month.
S1 (30:24):
Yeah. Well, and they're only as good as their ability
to be used and followed. And it's no good if
you get to the end of the month and say, well,
I messed up again. All right, let me try again
at the next month, that actually doesn't help you. You've
got to create a, a system to control the flow
of money that's actually going to curb the spending when
the money's gone. So you don't continue to spend beyond that.
(30:46):
And I think that's where the cash envelope system can
work for you. Carol, thanks for your call. Hey, thanks
for joining us today on Faith and Finance Live. Coming
up in just a few moments, Jerry Boyer will be
by we'll get Jerry's take on the markets and the economy.
But first, Terry's been waiting patiently in Maryland. Terry. Terry.
(31:09):
Go ahead. Terry. Are you with us? Oh, there you are.
Go right ahead.
S7 (31:16):
I have a military adult son who's looking to buy
a house and needs some help with financing. Um, what
are my options as far as gifting? He's talking about
an intra family loan through the IRS.
S1 (31:33):
Okay. Uh, yeah. Several thoughts on that. One is he's
probably talking about the annual gift exclusion, which just basically
says that any one person can give any other individual
up to $19,000. That's the 2025 number without reporting that
to the IRS. So you can give as many people
(31:55):
as you want 19,000. Don't tell the IRS about it.
If you're married, you could give twice that. You could
each give 19 a total of 38. Um, if you
go beyond that doesn't mean it's taxable. You just have
to report it on gift tax form 709, and that
would chip away at the lifetime exemption of gifting, which
happens to be today more than $13 million. So you'd
(32:16):
have to give a lot of people a lot of
money before you'd ever get anywhere close to that being
a tax issue. Um, but that may be what he
is referring to. But I guess the bigger question is why?
Why an intra family loan? I don't love the relational
impact of that. And if he's a service member, if
he's in the military, I mean, he has access to
(32:38):
some pretty phenomenal financing through the VA that doesn't even
require a down payment, although I don't recommend that. So
why the need to work through the family?
S7 (32:50):
I think he just wants to document regarding the interest,
doesn't want to take advantage.
S1 (32:57):
Well, right. So are you giving him a gift or
are you giving him a loan?
S7 (33:02):
He wants me to give him a loan.
S1 (33:06):
And why is that? Why not just run all of
that through a conventional lender, lender, or the VA? If
you're not giving him a gift, why involve you at all?
S7 (33:18):
Oh, that's a good question. I'm not sure.
S1 (33:21):
Yeah, okay. See, I would think through that. I mean,
it's one thing if you want to give him a
gift and you have the financial ability to do that
and you want to help him, you know, get started
with this home purchase and contribute toward the down payment,
that'd be great. And again, if you did up to 19,000,
you don't have to tell the IRS if you go
over it, you do. But it's still not taxable. It's
not it's not an issue. But the moment we start
(33:44):
to give loans to family members, I mean, the Bible
says describes the borrower lender relationship as master slave. It
it changes the relationship. And if for some reason he
couldn't pay, it's going to cause relational strain. And so
I would you know, I would advise you either make
a gift if it's within your means or, you know,
(34:04):
let him get a traditional or what you would call
a conventional loan or because, again, he's in the military,
he has access to VA financing. That's very lenient in
terms of how you qualify for it and how much
down payment you need to have, which just gets you
out of being his lender altogether, which I would recommend.
S7 (34:26):
Okay, great.
S8 (34:27):
Okay. Thank you very much. You're welcome Terry.
S1 (34:29):
Lord bless you. Thanks for calling today. Well, Jerry Boyer's here. Jerry.
A lot going on in the markets today. Looks like, uh,
we're Finnish, uh, green across the board here. Uh, we've
got inflation readings. We've got a new, uh, Q2 GDP.
Where do you want to start?
S9 (34:45):
Uh, let's go in that order, uh, inflation readings, uh,
markets up, inflation readings. Let's go. Let's go backwards order.
Because that's how the cause worked. Uh, we got a
new GDP number. Um, the second quarter, um, the economy
grew 3.8% annualized. It didn't grow 3.8% in three months.
You take the amount for three months and then you
multiply it by four, and that's 3.8%. Uh, and um,
(35:09):
that's not bad. I mean, that's like, you know, below,
excuse me, that's above average for the long term for
the American economy. Now, the quarter before that, it was negative.
It shrank. Uh, so that means that sort of year
to date, it's still a little subpar. So what's going
on there? Well, we were really heavy in the trade
war in the first quarter. And by the second quarter
we were doing a lot of, well, maybe we won't
(35:32):
have a trade war. And oh, they're coming in, they're
negotiating and we're dropping their you know, they're dropping their
tariffs on us and we're dropping tariffs on them. And
so a lot of that trade war stuff was kind
of off. And a lot of that uncertainty kind of
cleared up. Not all of it. It's still it's still
going on today. Uh, there was just one today about 100%
tariffs on importing certain pharmaceuticals, which I don't think is
(35:53):
moving the market that much because I don't think anyone
thinks it's going to stay. Um, and that's one of
the problems with tariff tweeting. Eventually people stopped believing you. Um,
so I think so. What? What's the effect of that
on the market? Well, it means the economy is doing
better than expected. Uh, and if the economy is doing
better than expected, let's let's enter into fed mind here.
(36:14):
The fed thinks that growth causes inflation. Uh, it doesn't,
but it thinks it does. Um, and so if we're
if we're if we don't if we have this growth, then, um,
you know, then, you know, we have a situation where
maybe the, maybe the central bank won't cut rates so much.
So in the middle of the week, the good news
(36:35):
of the economy was bad news for markets, right? Because
if the economy is growing at 3.8%, maybe it'll overheat.
Maybe it'll cause inflation. So like in the middle of
the week, markets were down. Then today the inflation number
turned out to be about what people expected. And so
it's like oh okay. Well inflation hasn't heated up that much.
So the fed can cut rates. So today the market
(36:57):
switched into green because they thought, well, we're back to
the fed cutting rates. Uh, and there's a probability market
where you can see, you know, what investors think the
fed is going to do. And they believe we're going
to get a rate cut in the next meeting and
in the meeting after that. So we're seeing once again,
the central bank is in charge of the markets. Um,
(37:19):
I think that's something we need to take into account
when we're analyzing markets. I don't think that's the way
it's supposed to work. I don't think that's what the
founders had in mind for their design. And I don't
think it's what the creator had in mind for the design.
I think the creator designed the world so that financial
wealth would go up when we're more productive, uh, and
go down when we're less productive, not go up when
(37:42):
we think the central bank is going to debase the currency.
But we live in the world, not of policymakers who
are following the biblical design. We live in the world
of policymakers who manipulate markets in order to get certain outcomes,
rather than letting the economy letting rather than letting us
set interest rates by our behavior. So you just had
(38:03):
a Terry was just on there and I guess she's
a saver, right? So she can lend money to her son.
I thought you gave great advice there, by the way. Hey,
watch out when you're lending money to your son. But
so let's say she lent money and they send it
and they set an interest rate. Well, that would be
an interest rate set between them. Or he goes to
the bank and then that interest rate would be set
by how many people are saving in the bank versus
(38:24):
how many people are borrowing from the bank. So we
would set the interest rate. And if we're a saving society,
the interest rate would be lower. There'd be abundant credit
if we were not a saving society. If we were
a borrowing society, then interest rates would be higher. It
would reflect the fact that we're borrowers that were short
term thinkers. Um, and that's the interest rate's supposed to
be set that way, and it's supposed to tell us
(38:45):
who we are. It's like a mirror that we look in.
The problem is that Keynesian economics says we don't. You
don't want to look in the mirror. You don't want
to see the reality. We're going to lower interest rates.
It's like a skinny mirror. We're going to lower interest
rates and make it look like we're people who can
afford to spend more, because lowering interest rates will pump
money into the system. We'll have all that extra money
and then we'll spend it, because spending drives the economy,
(39:06):
thought Keynes, and thinks everybody who runs fed policy, um,
you know, so we want to get people to spend
because that causes prosperity. And so that's why they're pumping
money into the system to get people to spend, because
they think that's going to stimulate the economy. By the way,
the president thinking a little bit Keynesian himself when he
keeps pushing for lower interest rates, um, and I think
(39:28):
he's selling himself short. I mean, if his big, beautiful bill,
which is now a large, lovely law, is everything he
promises and so good for growth, then why in the
world do we need to force down interest rates? Why
do we need to pump new money into the system?
Let let the policy play itself out and give us
the golden age based on market forces rather than a
gold age Golden age based on pressuring the fed to
(39:49):
pump money into the system.
S8 (39:51):
Yeah.
S1 (39:52):
And the reality is, even though the inflation number was
as expected, it's still not where we want it to be, right?
S9 (39:59):
Right. It's not even where the fed is supposed to
want it to be. And you know where I want
it to be. Zero.
S8 (40:05):
Zero. Yeah.
S9 (40:06):
I mean, I read the Bible. It says unjust weights
and measures are an abomination to the Lord. I take
that seriously. Uh, so I don't think there should be
any debasement of currency. I guess I'm a little strict
on that compared to at least the people who are
policy makers. So the fed said, well, what we want
is 2% purchasing power loss per year. We want we
want your your the value of your dollar to only
(40:28):
go down 2% a year. So if it's $100 off,
$100 only buys what, 90? You know, if it buys what, $98,
I think I have that wrong. It takes $100 to
buy what 98 used to buy before? That's good. All right.
I think it should. I think $100 should be $100
for 100 years. Um, and the prices should maybe fall
(40:48):
a little bit, but they set their inflation target at 2%.
The inflation target, the inflation number came in at 2.9%,
which is above that. So it shows how much we've
let things drift. We said zero inflation is too low.
We're going to make it two. And now we've gotten
to the point where oh well 2.93. That's okay. We'll
(41:11):
probably cut rates anyway. We'll probably create money. So we've
become very tolerant of inflation. We've become very tolerant of
what I'm going to say. The Bible calls an abomination
unjust weights and measures. Markets are up because they understand
that we're tolerant of that and that even though inflation
is almost 3%, the central bank is still going to
(41:31):
lower interest rates. It's still going to create new money
out of thin air. It's still going to pump that
money into the system, and it's going to pump it
in through markets. And that's why markets are the thing
that go up first.
S8 (41:42):
Yeah.
S1 (41:42):
Very good. Jerry, when it comes to, uh, you know, immigration,
I'm just curious in your thoughts. I'm seeing, uh, news
article here that apparently the Trump Gold card, the pathway
to a speedy residency has been cut from 5 million
to $1 million. Do you do you like that? Do
you like that strategy?
S9 (42:04):
Do I like the cutting it from 5 million to
1 million? Or do I like the existence of of
being able to buy citizenship?
S8 (42:10):
Which one buy citizenship?
S9 (42:12):
Not crazy about it. I think the citizenship is about
loyalty and allegiance. That's how the Constitution presents it. I
think we ought to stick with that.
S8 (42:21):
Yeah.
S1 (42:22):
Very good. Makes sense. All right, Jerry, as always, we
appreciate your insights, sir.
S9 (42:27):
And yours.
S8 (42:28):
Alright.
S1 (42:28):
God bless you, buddy. That's Jerry Bowyer. He's our resident economist.
He joins us each Friday on the program. Always great
to have him with us. Always educational. Hey, thanks for
being along today. Faith and Finance Live is a partnership
between Moody Radio and Faith five. Big thanks to my
team Josh, Jim, Omar and Tahira. Everybody here at Faith five.
We'll see you next time. Bye bye.
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CrimeLess: Hillbilly Heist
It’s 1996 in rural North Carolina, and an oddball crew makes history when they pull off America’s third largest cash heist. But it’s all downhill from there. Join host Johnny Knoxville as he unspools a wild and woolly tale about a group of regular ‘ol folks who risked it all for a chance at a better life. CrimeLess: Hillbilly Heist answers the question: what would you do with 17.3 million dollars? The answer includes diamond rings, mansions, velvet Elvis paintings, plus a run for the border, murder-for-hire-plots, and FBI busts.
Crime Junkie
Does hearing about a true crime case always leave you scouring the internet for the truth behind the story? Dive into your next mystery with Crime Junkie. Every Monday, join your host Ashley Flowers as she unravels all the details of infamous and underreported true crime cases with her best friend Brit Prawat. From cold cases to missing persons and heroes in our community who seek justice, Crime Junkie is your destination for theories and stories you won’t hear anywhere else. Whether you're a seasoned true crime enthusiast or new to the genre, you'll find yourself on the edge of your seat awaiting a new episode every Monday. If you can never get enough true crime... Congratulations, you’ve found your people. Follow to join a community of Crime Junkies! Crime Junkie is presented by audiochuck Media Company.
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If you've ever wanted to know about champagne, satanism, the Stonewall Uprising, chaos theory, LSD, El Nino, true crime and Rosa Parks, then look no further. Josh and Chuck have you covered.