April 15, 2025 • 42 mins
For years, U.S. stocks have led the way—but when everyone crowds to one side of the market, a shift is often just around the corner. On the next Faith & Finance Live, Mark Biller will join Rob West to explain why it might be time for foreign stocks to shine and how they may soon present the next wave of opportunity. Then Rob will answer your questions on different financial topics.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
S1 (00:08):
Are your investments all rowing in the same direction? It
might be time to rebalance the boat. Hi, I'm Rob West.
For years, US stocks have led the way. But when
everyone crowds to one side of the market, a shift
is often just around the corner. Mark Behler joins us
today to explain why foreign stocks might be the next
wave of opportunity. And then it's on to your calls
(00:30):
at 800 525 7000. That's 800, 500, 25 7000. This
is faith in finance. Live biblical wisdom for your financial decisions. Well,
it's great to have my friend Mark Behler on the program.
Mark is executive editor at Sound Mind Investing and underwriter
of this program. Mark and his team are always watching
(00:51):
the markets, which is no small feat these days. Uh,
and they're doing it so you don't have to. Mark,
great to have you back.
S2 (00:59):
Thanks, Rob. Good to be back.
S1 (01:01):
Well, excited to talk to you about just a wave
of topics today, but we're going to really focus in
on foreign stocks. I'm sure we'll get to the broader
market as well. Let me also mention that if you
have a question today for Mark Biller on the markets,
your portfolio, how to think about navigating the economic uncertainty
and market volatility, or you want to lean in specifically
(01:24):
to today's topic on foreign stock investing, you can call
right now, Mark will be sticking around for a good
bit of the program, and we'll look forward to taking
those investing related questions. The number 800 525 7000. Again
that's 800 525 7000. You can call right now. All
right Mark, let's begin with why US investors should pay
(01:48):
more attention in your view to foreign stocks right now.
S2 (01:52):
Yeah. Rob. Well, the main reason is diversification. That's the
main reason to consider putting foreign stocks in your portfolio.
You know, they're just another way to have equity exposure
within your portfolio. But foreign stocks tend to move a
little differently kind of their own drummer, if you will,
as opposed to U.S. stocks. And this year's been a
(02:15):
good example of that. During the first quarter of the year,
before all of the tariff stuff really kicked in in April, U.S.
stocks were down a little over 4%. Whereas a common
foreign fund that we use in one of our SMI
strategies was up over 8%. So while your U.S. stocks
(02:36):
were down, foreign stocks were up. That's really what you're
looking for when you're trying to diversify a portfolio. It's
important to point out, Rob, that while a lot of
people today don't have any foreign stock exposure, if we
were to go back, say, 20 years ago, nobody would
have blinked an eye at the thought of having 20%
(02:58):
or even more of their stock portfolio invested in international stocks.
That used to be pretty widely considered to be a
normal practice. The main reason that a lot of investors
have quit doing that in recent years is because the
US stock market has been so strong for the last
10 to 15 years. In fact, if we look back
(03:20):
over the last 14 years, US stocks have gained four
times as much as as foreign stocks. So no surprise
when investors keep seeing U.S. stocks outperform, they've gradually just
given up on foreign stocks. But in this article that
we're discussing today, I put some examples in there of
(03:42):
how we've been in this situation before. And we've seen
the pendulum swing back the other way, which has in
the past often caused foreign stocks to outperform for the
next several years. After we get to such an extreme
as we've had lately.
S1 (04:00):
Yeah, that's really helpful. Give us an example of that, mark.
S2 (04:03):
Yeah, sure. So the late 1990s were a pretty similar
environment to the recent market in a lot of ways.
That was, of course, the tech bubble when the whole
world went crazy for US internet stocks. That was kind
of similar to how the whole world has gone crazy
the last few years for our magnificent seven tech and
(04:24):
artificial intelligence stocks recently. So if we go back to
1995 to 1999, the S&P 500 gained over 20% for
five consecutive years in a row. And that helped U.S.
stocks outperform foreign stocks by about a two and a
half to one ratio over those five years. But sure enough,
(04:47):
after the.com bubble peaked in March of 2000, it flipped
back the other way for the next seven and a
half years and foreign stocks outperformed.
S1 (04:57):
Interesting. Well, we're going to continue to unpack this. Talking
about foreign stocks. We'll also pivot and cover the broader market.
Plenty of volatility in light of the tariffs. Some economic
weakness just a whole host of issues. The fed is
not appearing to be really looking to cut rates anytime
(05:17):
soon as they wait for the impact of the tariffs.
We'll talk with Mark about that and continuing to talk
about foreign stocks in your portfolio back on faith and finance.
Live after this. Stick around. Great to have you with
us today on Faith and finance. Live I'm Rob West.
We're taking your calls and questions today, but specifically for
(05:39):
this portion of the broadcast on investing related topics, the market,
your portfolio and anything in between. 800 525 7000. Mark
Biller's here today to tackle those questions again 800 525 7000.
The lines are open. Mark. We're talking today about a
great article you all have in the most recent SMI newsletter.
(06:03):
It's titled A time for Foreign Stocks to Shine. And folks,
if you want to check it out, you can read
it at soundmind. Org, that's Soundmind investing. And Mark, you
were sharing a bit about just some examples on where
foreign stocks can shine. Uh, you know, when everyone crowds
(06:25):
to one side of the boat, as I said in
the opening of the program today, markets have a way
of readjusting the seating. And I'd love for you to
kind of unpack how that works.
S2 (06:35):
Yeah, that's exactly right, Rob. And a big part of
why foreign stocks look so intriguing today is that U.S.
stocks have become so richly valued over the last 15 years,
while foreign stocks have gotten pretty cheap, largely because investors
have been ignoring them. So the average price to earnings
(06:55):
ratio for the US market was recently around 26, while
for the rest of the world it was about 16.
And listeners may not know exactly what that means, but
the big picture is that US stocks are very expensive
by historical standards, while foreign stocks have become fairly cheap. Now,
(07:18):
one thing I should add to that, Rob, is we
constantly drill into SMI members. That valuation by itself really
isn't a helpful timing indicator. Foreign stocks have been cheap
for a while now, but what that does tell us
is with such a big valuation gap, if we do
see the pendulum start to swing back in favor of
(07:39):
foreign stocks, then that just tells us that this could
be a move that could last for a while. So
it's the kind of thing where if someone saw that,
you know, one of our SMI strategies had us moving
into foreign stocks as far back as January, they might think, well,
that move is probably over. I missed it, and I
(07:59):
don't think that that's what we're talking about here, Rob.
I think this could be the kind of thing where
it took us 14 years to get to this position of,
of U.S. stock dominance, and it may not be 14
years going back the other way, but this is probably
a move that's going to have some legs if it
continues to develop.
S1 (08:20):
Yeah. Now, Mark, clearly, the market has been incredibly volatile
as of late, driven largely by at least most recently,
the tariffs and the uncertainty surrounding the tariffs. Uh, you know,
a lot of economists and CEOs saying while, you know,
a recession was was unlikely, though very possible with the
(08:42):
slowing of the economy. It's, you know, Almost. You know,
most are now counting on it, I guess because of
the tariffs. But still, so much remains to be seen. Uh,
is this just a negotiating tactic, or are they here
to stay? How does just the uncertainty right now in
the markets and especially given the disruption geopolitically, how does
(09:03):
that affect investing internationally?
S2 (09:06):
Yeah, that's a great question. And unfortunately like so many
questions right now, there's an awful lot of you know,
this is kind of unprecedented. So we're going to have
to wait and see. But generally speaking, in the past
there has been a lot of truth to the idea
that when the U.S., um, I don't know what the
expression is, exactly. The U.S. sneezes, the rest of the
(09:29):
world catches a cold. In other words, you know, when
when the U.S. has serious economic or market problems, the
rest of the world's markets tend to follow along. Now,
one thing that I think is kind of unique in
this setup, potentially, Rob, is, you know, we're the US
(09:50):
is kind of unilaterally, um, going into these trade, uh,
spats and tariff, uh, arguments with all these other countries.
But in, in if you turn it around from the
other side, all these other countries are not having similar
(10:11):
types of trade disputes with each other. And so there
is the potential that, um, to an increasing degree, the
other countries kind of look at each other and go, well,
the U.S. is giving us grief right now and they
don't want to trade with us, uh, you know, on
terms that we like, but we can still trade with
each other on terms that we like. And so I
(10:33):
think that there is some potential for a little bit
of a pivoting away from everyone's focus being, how do
I access that U.S. market that's so attractive? And maybe
there is a little bit more thought that goes into, okay,
we're going to lose a little bit trading with the U.S.
in terms of what we've been able to do in
the past, but maybe we can make that up by
(10:56):
trading more with each other. So that could offset a
little bit of that. I think the bigger dynamic there, Rob,
is that the US financial markets have benefited for so
long from inflows of capital from investors around the world.
And as we put in place policies, the tariffs are
(11:19):
an obvious example. But also things like us rearranging the defense, um, uh,
agreements around the world so that other countries now are
saying we have to spend a lot more money on
our own defense, on our own economies. What you're seeing
is then, Um, probably a tendency for foreign investors to say, well,
(11:44):
if we're going to be spending all this money at home,
you know, maybe I'm going to take some of my U.S.
money and bring it back home where all this action is.
And so even just a little readjustment in those capital
flows from the rest of the world into the U.S.
now all of a sudden, maybe being outflows from the U.S.
(12:04):
back into home markets, that can be a powerful tailwind
to foreign markets and potentially a little bit of a
headwind for U.S. markets.
S1 (12:16):
Interesting. Well, of course, all of this and the uncertainty
that surrounds it bodes well for that properly diversified portfolio
with exposure to both domestic and international across all asset
classes and, uh, and capitalization sizes for sure. But let's
dive into some questions today, Mark. We're here. We're talking investing.
(12:36):
And specifically for the moment, foreign investing. Alan's in Oak Forest, Illinois.
Go ahead. Sir.
S3 (12:43):
Um, I wondered if you had any countries that you
would wait one over the other in foreign investing?
S1 (12:51):
Yeah. Good question. Mark. We've got about 90s before the
next break. Go ahead.
S2 (12:55):
Yeah. Alan, you know, I, I tend to take a
little bit broader perspective in terms of, you know, I
think kind of like the the discussion of picking individual
stocks versus, you know, broadly diversified mutual funds in the US.
I think the same kind of applies to foreign investing.
(13:16):
So I would diversify pretty broadly. I mean, there are
some particular things about Europe right now, specifically the defense
spending pivot. That looks pretty good. Obviously, there are another
big trading bloc that people could pivot to outside of
the US. So I like European stocks pretty well. um,
(13:37):
there are some that I stay away from. I'm not
a big fan of investing in China, uh, for various reasons,
but I would diversify pretty broadly.
S1 (13:46):
Alan and Mark, you can go active management with an
international specialist. You can also go passive and buy one
of the baskets like an ETF. Right?
S2 (13:56):
That's exactly right.
S1 (13:57):
Yep, yep. The folks at, uh Sound Mind Investing can
help with that there. Uh, SMI newsletter and the digital
version of it will help guide you if you want
to make your own investment decisions. But with the a
strategy that, uh, you know, their team will give you
so you can make those changes on a month to
month basis, including the foreign allocations. Alan, thanks for your
(14:21):
call today. Back with more after this. Stay with us.
S4 (14:30):
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 (14:54):
Great to have you with us today on Faith and finance. Live.
I'm Rob West. We're taking your calls and questions today
specifically on investing related topics. And boy, there's been a
lot to think about in the markets these days. If
you have a question about where we might be headed
from here, how that affects your portfolio and just how
to navigate the volatility. Mark Miller is here today from
Sound mind Investing. We always look forward to our time
(15:16):
with Mark. And he'd be delighted to answer your investing
related questions. You can call right now 800 525 7000.
That's 800 525 7000. We've got a few lines open.
Let's go out to Albuquerque. Hi, Craig. Go ahead sir.
S5 (15:32):
Well, thank you for taking my call. Sure. I'm. I'm
in my mid 70s, and I'd like to get into
faith based investing. I have about 200,000 in an Edward
Jones account. Actually, three of them are taxable. A traditional
IRA and Roth. I've been getting mailings from sound Mind
(15:56):
Investing about their management situations, and I've also heard of
an organization called Sovereign Private Wealth. Would you have any
advice for me?
S1 (16:09):
Yeah. What could it be? Sovereign sovereign's capital, maybe.
S5 (16:14):
No. It's sovereign private wealth.
S1 (16:15):
Sovereign private wealth. Okay. I don't.
S5 (16:17):
Know.
S1 (16:17):
Yeah. Don't know that that firm in particular. What I
will say is. And then I'll let Mark weigh in
with any thoughts he has. Uh, you know, there there
are plenty of advisors that can offer a faith based
investing strategy. One option would be go find a CA
in your area there in Albuquerque you could go to faith.
Com our website that's faith. Com and when you do
(16:38):
a search for a certified Kingdom advisor in the investing area,
you're you'll be asked to indicate whether you want a
full listing of CaaS or only those that offer faith
based investments. And you would be able to make that
selection and then be presented with a list to then
go interview. Uh, you could go directly to some of
the asset managers in this play, this space. That would
(17:01):
be another option. But if you're looking for an advisor,
I think a CA in the faith based investing space
would give you what you need. Uh, many of them
will be at Edward Jones. And so you could stay
right where you're at. It just may involve switching to
a different advisor. Um, Mark, anything else you might want
to add to that?
S2 (17:20):
Yeah, I think, Craig, the biggest thing is to, um,
if you are looking for an advisor, is to talk
to a few different ones and get a sense of,
of their investing approach and their style. And very often
people will find that, you know, in the course of
those conversations that one of those just kind of clicks
(17:40):
with you that it, you know, feels right, that that's
the approach you want to take. And, you know, that's
the advantage of talking to a few different ones is
if you just call one person and go with the
first person you talk to, then sometimes you're you're not
necessarily super well aligned. And that may not be as
obvious as after you've had a few of those conversations.
(18:03):
So that would be the only thing I would add
to what Rob said. I think the rest of that
is right on. Um, call a few, talk to them, and,
and try to find somebody that that seems like they
have an approach that really gels with how you want
to invest.
S1 (18:18):
Excellent, Greg, we appreciate your call today. Call anytime. Uh,
down to Fort Lauderdale. Hi, Marie. Go ahead.
S6 (18:25):
Hi. My name is Marie. Hello?
S1 (18:29):
Yes, ma'am. How can we help?
S6 (18:31):
Oh, hi, Rob. I'm so. I love your show. I
listen to it every day. I'm 81 years old, and
I learn something new every day.
S1 (18:40):
Well, I'm so thrilled to hear that. That's very kind
of you. Well, I'm glad you decided to call in.
How can I serve you today?
S6 (18:47):
I have a new an annuity. I, I don't understand.
It has a death benefit. I took it out in
the year of 2000. And this is like 2020, 25
years later. And I don't understand it. And I don't
understand the jargon that you use. And I don't know
what to do about it. I don't know if it's
a good investment. I mean, I've had it since 2000.
(19:10):
I don't know what to do.
S1 (19:11):
Yeah, yeah. Well, it's a great question. And Mark Marie
is not the first person to be confused by the
fine print on an annuity, huh?
S2 (19:19):
Yeah, that's for sure. Unfortunately, they do tend to be
kind of complicated. And that's one reason why when people
are evaluating whether to buy an annuity. A lot of
times Rob and I will will counsel that that that
is one of the potential downsides is all the the
watch outs and and gotchas that can be loaded into
(19:42):
those contracts. As far as what you've got now and
what your options are. Um, you know, a lot of
times the, the best approach is if you can, um,
find an expert that can walk through that with you,
that's that's obviously ideal. Um, sometimes people can do that
(20:03):
even maybe by finding a financial professional at their church
that might be willing to take a look at that
with you. Um, you know, if you have accounts that
you want managed, um, you know, often you can bring
this as part of, you know, your overall situation to
a Sica or another financial professional. Um, you know, of
(20:24):
course you can try to get some of that information
from the annuity company themselves. Um, you know, we have
some articles, Marie, on our Sound Mind Investing website about
annuities that could help you maybe formulate a list of
a few questions to ask the annuity provider, um, about
(20:46):
how things are structured within your policy. Um, but it
is a tricky situation. There's no question about that. Rob,
what are some things that have worked well in your experience?
S1 (20:58):
Yeah, I think you nailed it, Marc. And that is Marie.
You really need an advisor who can help you navigate
that fine print. Look at what do you have? It
may be that where you're at is the very best
place that you know this is going to meet your
needs in terms of safety and security. It gives you
the ability to convert it to an income stream. You're
not at the risk of the market. You also may
(21:20):
discover that there's a better place for you just given
your giving your goals and objectives? But I think it
really would not be something we could do over the radio.
And an advisor could really help you understand what do
I have today? And then in light of where I'm going,
what are my best options? So, um, let's do this.
Why don't you stay on the line? Our team will
get your information. I'd be happy to have somebody from
(21:41):
Kingdom Advisors call you. Do a search for case. They're
in Fort Lauderdale and help you pick the right one.
Stay on the line. We'll get your information. We appreciate
your call. We'll be right back.
S7 (21:59):
Great to have you with us today on.
S1 (22:01):
Faith and finance live here on Moody Radio. I'm Rob West.
S7 (22:04):
With me today.
S1 (22:04):
My friend Mark Biller. He's executive editor at Sound Mind Investing.
We're talking about foreign investments today and why you should
consider having some exposure to foreign investments in your portfolio.
In just a moment, Mark will share, in addition to
what he's already shared, a few of those key reasons
highlighted in the article we're discussing today. By the way,
(22:25):
if you'd like to read the whole thing, just head
to Sound Mind investing.org. Click on the article time for
Foreign Stocks to shine. Again, that's sound mind investing. Back
to the phones though. Don is holding there in Illinois.
Go ahead sir.
S8 (22:42):
Yeah. Thanks, Rob. I want to ask Mark a question. Uh,
I was thinking about, uh, allocating some money, uh, differently.
And I've been watching the international, uh, mutual fund that
I kept an eye on. But it's the International Value fund,
and it's been doing really well. And I like what
you said, that it might not be too late to
get in on the party. So what's your opinion on
(23:03):
international value funds?
S1 (23:05):
Excellent, Mark.
S2 (23:07):
Yeah, Don, I like it a lot. Um, we actually
recommended a particular international value fund at the end of
March in our, our upgrading strategy, which is one of
our actively managed approaches. Um, so I'm definitely on board
with the idea of international value. And I think that
(23:27):
right now, in particular, as I was mentioning earlier in
the program, you know, a lot of foreign companies have
just been ignored to the point where there are some
tremendous values out there. Um, internationally. And I've heard other, uh,
fund managers, you know, talking about how the types of
(23:51):
opportunities that, uh, really have just not been available in
US markets from a valuation standpoint for many years. Um,
we're starting to see those types of, uh, valuation opportunities, um,
in foreign markets. So I think there's a lot to
like there. Don. Um, now it is important. I hope
(24:15):
that I'm not coming across, Uh, wrong. In in that.
I'm definitely not suggesting that people get rid of all
their US exposure and go 100% into international stocks or
anything like that, but from the starting point where most U.S.
investors are today, which is that they have either no
(24:36):
international exposure or very low. I think that, you know,
adding maybe 10 to 20% of their stock portfolio into
international stocks makes an awful lot of sense today because
of the valuation disparities as well as some of the
other immediate catalysts. So I like the sound of it. Don. Um,
(24:59):
anything to add?
S1 (25:00):
No, I think that's great, Don. Hopefully that gives you
what you're looking for. It sounds like you're on the
right track there. Thanks for calling. Mark, you mentioned the
upgrading strategy. And this is really a unique offering for
folks that want to kind of keep control over the
buys and sells without delegating to an advisor, but wants
somebody making those more active mutual fund recommendations as they move,
(25:23):
you know, in line with the momentum and technicals of
the market. Will you just give a 32nd, uh, overview
of that?
S2 (25:31):
Yeah, absolutely. So we are, uh, trend followers. We use, um,
rules based strategies. So we're not, you know, sticking our
finger in the wind, saying, well, I like this idea.
I like that idea. Now we're we're actually monitoring the
market's own trends and prices. And that does lead us
(25:51):
sometimes to move money from one part of the market, like, uh,
small company U.S. stocks into another part, like foreign value stocks.
And so that is a process that we, you know,
we watch the market month by month. And in our newsletter,
we will say very specifically for our members, uh, it's
(26:13):
time to sell fund ABC and buy fund XYZ. And
so our our members, um, don't have their money managed
by us necessarily the newsletter folks don't, but they get
those instructions each month in the issue of SMI. And
then they log into their own accounts at Schwab, fidelity,
(26:37):
or wherever they have their account, and they make their
own transactions. So they are fully in control of all
of their own trading and their own accounts. Um, but
they're getting that do it yourself with help from us,
and that we're the ones that are, uh, telling them
when it's time to make a move and exactly what
(26:59):
that move should be. So it's kind of a good
middle of the road for somebody who maybe doesn't want
to turn everything over to an advisor and have them
do it all, but they don't feel confident that they
know exactly what to do Themselves. It's kind of a
middle ground for those do it yourselfers.
S1 (27:16):
Yeah. That's helpful. Thanks for that. Uh, let's go, uh,
to West Palm Beach, Florida. Emilio, thanks for calling. How
can we help?
S9 (27:24):
Good afternoon, gentlemen. Thank you for taking the call. Um,
discussing foreign investment. Investing. Are there any faith based foreign?
Foreign investing?
S7 (27:35):
Yeah.
S1 (27:36):
Many of the fund families that we talk about, uh,
have faith based, uh, well, their their faith based fund families,
but they have international, uh, funds as a part of
their overall fund mix. That would include, uh, guidestone the
Guidestone international equity. Eventide. Uh, one ascent has the one
ascent international equity. Praxis has the Praxis International index. Uh,
(28:01):
Timothy has an international Crossmark has an international as well
as inspire. So just about all the fund families you'll
hear us talking about have an international fund as a
part of their mix and their expressly faith based in
their approach. Mark, anything else you would add?
S2 (28:17):
No. You are a fount of knowledge. I'm impressed. You
can just rattle all this off. That was great.
S1 (28:24):
Excellent. Well, Emilio, is that helpful?
S9 (28:27):
Yes, sir. Thank you, I appreciate it.
S1 (28:29):
All right. Absolutely. 800 525 7000 is the number to
call Mark Biller here today. Taking your investing related questions. Uh, Mark, let's, uh,
dig into just a couple of those additional factors that
you're seeing that would give rise to why we shouldn't
overlook foreign investments in our portfolio.
S2 (28:49):
Yeah. Rob. Well, one of the most important ones, uh,
is that government spending trends are really reversing. So we're
all aware that here in the US, we've had a
focus on Doge, on trying to get our budget deficit down. Um, well,
as part of the negotiations, again, going back to that
(29:10):
defense situation, um, where we're wanting, um, our allies to
spend a lot more money on their own defense. A
lot of those countries that did not spend as much, uh,
their governments did not, I should say following Covid, they're
all of a sudden ramping up their government spending. And
(29:31):
if there's one thing we've learned in the few years
since Covid, it's that that government spending, you know, when
we think of government spending, we don't always think it through.
But that money, where does it go? Well, it usually
goes to companies in those countries. And so as we're
cutting back on our government spending, our government spending over
(29:52):
the last 3 or 4 years has been a huge
boost to the US market. Now we're reversing that. We're
seeing those spending flows happen in other foreign countries, and
it's reasonable to assume that those fiscal impulses will be
a big boost to those foreign stock markets. So that's
(30:12):
one of the immediate catalysts to look at, to say
why we think foreign markets are ready to roll.
S1 (30:19):
Yeah. And as Mark said a moment ago, this is
not about selling out of the US to go only foreign.
But why if you've overlooked the foreign markets through stocks
or mutual funds or ETFs, it's a part of a
properly diversified portfolio. And now might be a really opportune
time for that portion of your portfolio. Check out this
(30:40):
article time for Foreign Stocks to shine. Sound mind investing?
Org back with Mark Miller in our final segment after
this break. Stay with us. Hey, great to have you
with us today on Faith and Finance Live. By the way,
if you listen to the program regularly, perhaps you're a
super fan like Marie who called a moment ago. She
(31:03):
listens every day, loves the program. We're so thankful when
you call and you tell us how God has used
this program and the council that you've heard and the
guests that we have as an encouragement to you, and
perhaps that you've been able to take away something practical.
We'd invite you to become a faithful partner. If that's
you and you listen regularly, you can do that at Faith.
(31:25):
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(31:49):
This would be a great time to become a partner,
because we're preparing in the month of May to send
out issue two of Faithful Steward and our new study,
Wisdom Over Wealth 12 lessons from Ecclesiastes on Money, a
deep dive into the Book of Ecclesiastes That will be
a surefire encouragement in your financial life. You can head
(32:11):
to faith.com just click give. To learn more. Let's head
back to the phones. We're going to go to Cleveland, Ohio.
Lynn's been waiting patiently. Go ahead.
S10 (32:20):
Hi. Thank you so much for your program and I
really have appreciated it. Well thank you. I'm calling. I'm
a widow for two years, and, um, I'm a little
jumpy with the economy. I have most of my, um, portfolio,
(32:41):
if you would, is with work. IRA and I had
upped my amount that I've been putting into it to 18%
of my income. Um, I will be able to get
my husband's or my widow's pension in another about three years.
(33:02):
I'm 64. Um, so I will have that. That won't
be enough to retire on, so I'll plan to continue
to work, um, to supplement it. But my question is, um,
if I should decrease the amount I'm putting in my
IRA to from 18% to 10%, I have a 6%
(33:26):
match at work and put the extra money into a
high yield savings account. I would like to retire when
I'm 69, and then I would, um, and I don't
want to take my own Social Security until I'm 70. Yeah. Um,
(33:47):
so for that one year, I would need some cash available.
I do, I do have a financial advisor, and they are, um,
it's fidelity, but they are using the The international stocks
to try and kind of cushion the things going on
in the economy.
S1 (34:07):
Yeah, well, that was a really helpful overview, Len, and
you're doing a great job. It sounds like you've got
a lot of great pieces in place. Let me just
clarify a few things. So you're 67 now planning to
work for another two years. You'll have one year between
69 and 70 where you'll be funding, you know, 100%
of your monthly need for your lifestyle out of your retirement,
(34:30):
401 K because you're going to delay, which I like,
delay taking Social Security to age 70. Is that correct?
Did I have that right?
S10 (34:39):
Yes. Um, correct. Except I'm 64. And um, so I
have a couple extra years of working.
S1 (34:47):
Okay, great. So you've got, uh. Yeah. So another five
years before you're planning to retire. What is your balance
in that 401 K right now?
S10 (34:56):
Uh, about 450,000.
S1 (34:59):
Okay. And you said you're putting in 18% in the
company's matching six, and you're looking at perhaps dropping it
to ten to boost your high yield savings. What do
you have in savings today?
S10 (35:11):
Um, right now in savings, I have, um, well, between
checking and savings, I have about 35,000.
S1 (35:19):
All right. And what do you spend in a typical month?
S10 (35:21):
My emergency. Uh, about, um, 4000.
S1 (35:28):
Okay. Got it. Yeah. So, I mean, at this point,
with 35,000 in the bank, uh, you've got, you know,
almost nine months worth of emergency reserves, so that's great. Uh,
it sounds like you're properly diversified. I know you mentioned
you even have foreign stocks. I mean, Mark, I'm thinking
if she can continue to put away at this level 18%
(35:48):
plus the match for these next five years, she should
be in, you know, pretty good shape. I mean, let's
say that grows to 600,000, uh, you know, pulling 24,000
a year is a no brainer. Perhaps even, you know,
as much as she needs. With 4000 a month, maybe
that drops to 3500. Uh, for that first year shouldn't
(36:10):
be a big deal, because then that would largely be
offset by Social Security. But what are your thoughts?
S2 (36:15):
Yeah, I agree with all of that, Rob. The one
piece that I think may make a little sense for you, Lynn,
is if you're looking to kind of split the difference. Um,
you know, I'm kind of reading into your question that
maybe you're a little nervous about markets and whatnot, which
might be one reason why you want to decrease the
(36:36):
investment part and move some of that into savings, which
is is safer. Um, you know, one option that could
kind of bridge that gap a little bit would be
to add a small gold allocation to your holdings. Um,
that can give you a little bit more upside and
a little, a lot more protection against the potential of
(36:57):
higher inflation, which higher inflation is one of the big
reasons why you wouldn't want to overdo the savings that
could lose ground if if we do see a little
higher inflation rate in between now and when, you need
to use that savings. So a small allocation there, which
you could, could do if you have an IRA, you
(37:20):
could could add some there, maybe even within the 401
K depending on your options. But that might be a
nice little supplement. And I'm not talking about a huge amount,
but somewhere in the, you know, 5% range or something
like that, that might be a nice option that you
could kind of think of as savings. It's going to
move around more than a savings account would for sure,
(37:42):
but it would give you a little bit of inflation
protection while you continue to build both of these other
pieces that we've been talking about. That's really the only
other thing that stands out to me, though, Rob. Um.
S1 (37:54):
Yeah, I like that a lot, Lynn. I don't know
that you mentioned you had some foreign stocks, but, uh,
and if you said this, I apologize. But what is
that breakdown in your 401 K between stocks and bonds?
Do you know, percentage wise?
S10 (38:07):
Hi. Yes, I'm at 60, 40.
S1 (38:11):
60 stocks or 60 bonds.
S10 (38:13):
Stocks and 60 stocks and 40 bonds.
S1 (38:17):
Okay. So yeah, I guess that would be the only question. Um,
I mean, that, uh, is a little rich just from
a typical allocation mark for somebody five years out from retirement.
But what are your thoughts on 6040 with 40 being
in stocks?
S2 (38:32):
Yeah it is. And under normal circumstances, I would probably
be a little more inclined to maybe add to the bonds.
I don't love bonds here right now, Rob, honestly, because
as we've seen over in the last couple of weeks,
bonds are acting weird right now. You know, we've had
stocks falling. We've had economic growth falling. Normally that would
(38:53):
be good for bonds. And yet we're seeing longer term
bond yields rising at the same time. So um, I'm
not sure I would would love to, to bump up
that bond exposure a lot here. But there again, not
to beat the same horse, but in some respects that
gold piece might be a nice little, uh, additional holding
(39:16):
where maybe it goes to like a 55% stocks. You
hold on to the 40% bonds and you add that 5%
in gold or some other investment similar to that. That
might be a good diversifier for you, I think.
S1 (39:32):
Big picture, Lynne, you're doing great. You're on the right
track here. And just based on the limited information we have,
it sounds like we're saying stay the course. And perhaps
to Mark's point, if you're going to do anything, maybe
add some gold exposure either through the 41K if you've
got it, or if you also have an IRA, you
certainly could do it there. And you could even look
at one of the the tracker ETFs without having to
(39:53):
buy the physical gold like GLD. Or, you know, there's
maybe a dozen of them or more. So hopefully that
helps you. We appreciate your call. Quickly to Spokane. Uh, Arlene,
we have just a minute and a half. Go ahead.
S11 (40:06):
Good. I'll be really quick. Thank you so very much.
You guys have got an awesome program that we all
get to benefit from. I have two quick questions that
you can ask. Doing some recent investing. And I see people,
professionals that have all different kinds of initials behind their name,
like CLU, C, certified financial planners, different types of financial advisors.
(40:29):
Could you give me definitions, maybe for those types of, um,
professional people? And who would be a good one to
look for for general investing? And the second question that
I had was about that list of percentages. How much
of my portfolio should go for precious metals? How much
should go into savings. How much should go elsewhere?
S12 (40:52):
Yeah, and that's it.
S1 (40:52):
Let me let me start with the first one. I'll
get Mark quickly to weigh in on the second. Uh,
you know, you're typically going to hear a few terms
when it comes to investment professionals. You're going to hear Aria,
which stands for Registered Investment Advisor. You'll also hear, uh,
you know, financial advisor or broker dealer, and then you'll
hear wealth manager. Any of those can be great. I
(41:14):
think the key is typically what folks are looking for
is something called a fiduciary, where they're required to put
your interests ahead of their own. Um, and so we would,
you know, say that on top of that experience and
that status as a fiduciary. Caixa is the designation we like.
It's our designation. It's the only one in financial services
(41:37):
for investing professionals that can bring a biblical worldview. And
they've met all kinds of other requirements experience and character
and competence and, uh, pastor Past a reference client. References.
They've been through a training program, a regulatory review. So
it's a pretty robust designation that's going to give you
a lot of confidence that this is somebody that not
only matches your values, but also can can bring a
(42:01):
wealth of experience. You can find a CX in your
area when you head to faith. Com and just click
Find a Professional. Unfortunately, we're not going to be able
to get to that second part, but Arlene, I'd love
for you to call back on a future broadcast. Uh, Mark, uh,
just about out of time, but so appreciate you and
all that you and the team do at sound mind investing.
(42:22):
Thanks for being here today.
S2 (42:24):
Thank you. Rob.
S1 (42:25):
All right, folks, if you want to check out this article,
I'd encourage you to do so. It's a great read.
Just head to Sound Mind investing.org and look for time
for foreign stocks to shine. Uh, big thanks to Tahira, Jim, Dan,
and Deb. Faith in finance lives a partnership between Moody
Radio and Faith fi. We'll see you next time. Bye bye.
Are your investments all rowing in the same direction? It
might be time to rebalance the boat. Hi, I'm Rob West.
For years, US stocks have led the way. But when
everyone crowds to one side of the market, a shift
is often just around the corner. Mark Behler joins us
today to explain why foreign stocks might be the next
wave of opportunity. And then it's on to your calls
(00:30):
at 800 525 7000. That's 800, 500, 25 7000. This
is faith in finance. Live biblical wisdom for your financial decisions. Well,
it's great to have my friend Mark Behler on the program.
Mark is executive editor at Sound Mind Investing and underwriter
of this program. Mark and his team are always watching
(00:51):
the markets, which is no small feat these days. Uh,
and they're doing it so you don't have to. Mark,
great to have you back.
S2 (00:59):
Thanks, Rob. Good to be back.
S1 (01:01):
Well, excited to talk to you about just a wave
of topics today, but we're going to really focus in
on foreign stocks. I'm sure we'll get to the broader
market as well. Let me also mention that if you
have a question today for Mark Biller on the markets,
your portfolio, how to think about navigating the economic uncertainty
and market volatility, or you want to lean in specifically
(01:24):
to today's topic on foreign stock investing, you can call
right now, Mark will be sticking around for a good
bit of the program, and we'll look forward to taking
those investing related questions. The number 800 525 7000. Again
that's 800 525 7000. You can call right now. All
right Mark, let's begin with why US investors should pay
(01:48):
more attention in your view to foreign stocks right now.
S2 (01:52):
Yeah. Rob. Well, the main reason is diversification. That's the
main reason to consider putting foreign stocks in your portfolio.
You know, they're just another way to have equity exposure
within your portfolio. But foreign stocks tend to move a
little differently kind of their own drummer, if you will,
as opposed to U.S. stocks. And this year's been a
(02:15):
good example of that. During the first quarter of the year,
before all of the tariff stuff really kicked in in April, U.S.
stocks were down a little over 4%. Whereas a common
foreign fund that we use in one of our SMI
strategies was up over 8%. So while your U.S. stocks
(02:36):
were down, foreign stocks were up. That's really what you're
looking for when you're trying to diversify a portfolio. It's
important to point out, Rob, that while a lot of
people today don't have any foreign stock exposure, if we
were to go back, say, 20 years ago, nobody would
have blinked an eye at the thought of having 20%
(02:58):
or even more of their stock portfolio invested in international stocks.
That used to be pretty widely considered to be a
normal practice. The main reason that a lot of investors
have quit doing that in recent years is because the
US stock market has been so strong for the last
10 to 15 years. In fact, if we look back
(03:20):
over the last 14 years, US stocks have gained four
times as much as as foreign stocks. So no surprise
when investors keep seeing U.S. stocks outperform, they've gradually just
given up on foreign stocks. But in this article that
we're discussing today, I put some examples in there of
(03:42):
how we've been in this situation before. And we've seen
the pendulum swing back the other way, which has in
the past often caused foreign stocks to outperform for the
next several years. After we get to such an extreme
as we've had lately.
S1 (04:00):
Yeah, that's really helpful. Give us an example of that, mark.
S2 (04:03):
Yeah, sure. So the late 1990s were a pretty similar
environment to the recent market in a lot of ways.
That was, of course, the tech bubble when the whole
world went crazy for US internet stocks. That was kind
of similar to how the whole world has gone crazy
the last few years for our magnificent seven tech and
(04:24):
artificial intelligence stocks recently. So if we go back to
1995 to 1999, the S&P 500 gained over 20% for
five consecutive years in a row. And that helped U.S.
stocks outperform foreign stocks by about a two and a
half to one ratio over those five years. But sure enough,
(04:47):
after the.com bubble peaked in March of 2000, it flipped
back the other way for the next seven and a
half years and foreign stocks outperformed.
S1 (04:57):
Interesting. Well, we're going to continue to unpack this. Talking
about foreign stocks. We'll also pivot and cover the broader market.
Plenty of volatility in light of the tariffs. Some economic
weakness just a whole host of issues. The fed is
not appearing to be really looking to cut rates anytime
(05:17):
soon as they wait for the impact of the tariffs.
We'll talk with Mark about that and continuing to talk
about foreign stocks in your portfolio back on faith and finance.
Live after this. Stick around. Great to have you with
us today on Faith and finance. Live I'm Rob West.
We're taking your calls and questions today, but specifically for
(05:39):
this portion of the broadcast on investing related topics, the market,
your portfolio and anything in between. 800 525 7000. Mark
Biller's here today to tackle those questions again 800 525 7000.
The lines are open. Mark. We're talking today about a
great article you all have in the most recent SMI newsletter.
(06:03):
It's titled A time for Foreign Stocks to Shine. And folks,
if you want to check it out, you can read
it at soundmind. Org, that's Soundmind investing. And Mark, you
were sharing a bit about just some examples on where
foreign stocks can shine. Uh, you know, when everyone crowds
(06:25):
to one side of the boat, as I said in
the opening of the program today, markets have a way
of readjusting the seating. And I'd love for you to
kind of unpack how that works.
S2 (06:35):
Yeah, that's exactly right, Rob. And a big part of
why foreign stocks look so intriguing today is that U.S.
stocks have become so richly valued over the last 15 years,
while foreign stocks have gotten pretty cheap, largely because investors
have been ignoring them. So the average price to earnings
(06:55):
ratio for the US market was recently around 26, while
for the rest of the world it was about 16.
And listeners may not know exactly what that means, but
the big picture is that US stocks are very expensive
by historical standards, while foreign stocks have become fairly cheap. Now,
(07:18):
one thing I should add to that, Rob, is we
constantly drill into SMI members. That valuation by itself really
isn't a helpful timing indicator. Foreign stocks have been cheap
for a while now, but what that does tell us
is with such a big valuation gap, if we do
see the pendulum start to swing back in favor of
(07:39):
foreign stocks, then that just tells us that this could
be a move that could last for a while. So
it's the kind of thing where if someone saw that,
you know, one of our SMI strategies had us moving
into foreign stocks as far back as January, they might think, well,
that move is probably over. I missed it, and I
(07:59):
don't think that that's what we're talking about here, Rob.
I think this could be the kind of thing where
it took us 14 years to get to this position of,
of U.S. stock dominance, and it may not be 14
years going back the other way, but this is probably
a move that's going to have some legs if it
continues to develop.
S1 (08:20):
Yeah. Now, Mark, clearly, the market has been incredibly volatile
as of late, driven largely by at least most recently,
the tariffs and the uncertainty surrounding the tariffs. Uh, you know,
a lot of economists and CEOs saying while, you know,
a recession was was unlikely, though very possible with the
(08:42):
slowing of the economy. It's, you know, Almost. You know,
most are now counting on it, I guess because of
the tariffs. But still, so much remains to be seen. Uh,
is this just a negotiating tactic, or are they here
to stay? How does just the uncertainty right now in
the markets and especially given the disruption geopolitically, how does
(09:03):
that affect investing internationally?
S2 (09:06):
Yeah, that's a great question. And unfortunately like so many
questions right now, there's an awful lot of you know,
this is kind of unprecedented. So we're going to have
to wait and see. But generally speaking, in the past
there has been a lot of truth to the idea
that when the U.S., um, I don't know what the
expression is, exactly. The U.S. sneezes, the rest of the
(09:29):
world catches a cold. In other words, you know, when
when the U.S. has serious economic or market problems, the
rest of the world's markets tend to follow along. Now,
one thing that I think is kind of unique in
this setup, potentially, Rob, is, you know, we're the US
(09:50):
is kind of unilaterally, um, going into these trade, uh,
spats and tariff, uh, arguments with all these other countries.
But in, in if you turn it around from the
other side, all these other countries are not having similar
(10:11):
types of trade disputes with each other. And so there
is the potential that, um, to an increasing degree, the
other countries kind of look at each other and go, well,
the U.S. is giving us grief right now and they
don't want to trade with us, uh, you know, on
terms that we like, but we can still trade with
each other on terms that we like. And so I
(10:33):
think that there is some potential for a little bit
of a pivoting away from everyone's focus being, how do
I access that U.S. market that's so attractive? And maybe
there is a little bit more thought that goes into, okay,
we're going to lose a little bit trading with the U.S.
in terms of what we've been able to do in
the past, but maybe we can make that up by
(10:56):
trading more with each other. So that could offset a
little bit of that. I think the bigger dynamic there, Rob,
is that the US financial markets have benefited for so
long from inflows of capital from investors around the world.
And as we put in place policies, the tariffs are
(11:19):
an obvious example. But also things like us rearranging the defense, um, uh,
agreements around the world so that other countries now are
saying we have to spend a lot more money on
our own defense, on our own economies. What you're seeing
is then, Um, probably a tendency for foreign investors to say, well,
(11:44):
if we're going to be spending all this money at home,
you know, maybe I'm going to take some of my U.S.
money and bring it back home where all this action is.
And so even just a little readjustment in those capital
flows from the rest of the world into the U.S.
now all of a sudden, maybe being outflows from the U.S.
(12:04):
back into home markets, that can be a powerful tailwind
to foreign markets and potentially a little bit of a
headwind for U.S. markets.
S1 (12:16):
Interesting. Well, of course, all of this and the uncertainty
that surrounds it bodes well for that properly diversified portfolio
with exposure to both domestic and international across all asset
classes and, uh, and capitalization sizes for sure. But let's
dive into some questions today, Mark. We're here. We're talking investing.
(12:36):
And specifically for the moment, foreign investing. Alan's in Oak Forest, Illinois.
Go ahead. Sir.
S3 (12:43):
Um, I wondered if you had any countries that you
would wait one over the other in foreign investing?
S1 (12:51):
Yeah. Good question. Mark. We've got about 90s before the
next break. Go ahead.
S2 (12:55):
Yeah. Alan, you know, I, I tend to take a
little bit broader perspective in terms of, you know, I
think kind of like the the discussion of picking individual
stocks versus, you know, broadly diversified mutual funds in the US.
I think the same kind of applies to foreign investing.
(13:16):
So I would diversify pretty broadly. I mean, there are
some particular things about Europe right now, specifically the defense
spending pivot. That looks pretty good. Obviously, there are another
big trading bloc that people could pivot to outside of
the US. So I like European stocks pretty well. um,
(13:37):
there are some that I stay away from. I'm not
a big fan of investing in China, uh, for various reasons,
but I would diversify pretty broadly.
S1 (13:46):
Alan and Mark, you can go active management with an
international specialist. You can also go passive and buy one
of the baskets like an ETF. Right?
S2 (13:56):
That's exactly right.
S1 (13:57):
Yep, yep. The folks at, uh Sound Mind Investing can
help with that there. Uh, SMI newsletter and the digital
version of it will help guide you if you want
to make your own investment decisions. But with the a
strategy that, uh, you know, their team will give you
so you can make those changes on a month to
month basis, including the foreign allocations. Alan, thanks for your
(14:21):
call today. Back with more after this. Stay with us.
S4 (14:30):
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 (14:54):
Great to have you with us today on Faith and finance. Live.
I'm Rob West. We're taking your calls and questions today
specifically on investing related topics. And boy, there's been a
lot to think about in the markets these days. If
you have a question about where we might be headed
from here, how that affects your portfolio and just how
to navigate the volatility. Mark Miller is here today from
Sound mind Investing. We always look forward to our time
(15:16):
with Mark. And he'd be delighted to answer your investing
related questions. You can call right now 800 525 7000.
That's 800 525 7000. We've got a few lines open.
Let's go out to Albuquerque. Hi, Craig. Go ahead sir.
S5 (15:32):
Well, thank you for taking my call. Sure. I'm. I'm
in my mid 70s, and I'd like to get into
faith based investing. I have about 200,000 in an Edward
Jones account. Actually, three of them are taxable. A traditional
IRA and Roth. I've been getting mailings from sound Mind
(15:56):
Investing about their management situations, and I've also heard of
an organization called Sovereign Private Wealth. Would you have any
advice for me?
S1 (16:09):
Yeah. What could it be? Sovereign sovereign's capital, maybe.
S5 (16:14):
No. It's sovereign private wealth.
S1 (16:15):
Sovereign private wealth. Okay. I don't.
S5 (16:17):
Know.
S1 (16:17):
Yeah. Don't know that that firm in particular. What I
will say is. And then I'll let Mark weigh in
with any thoughts he has. Uh, you know, there there
are plenty of advisors that can offer a faith based
investing strategy. One option would be go find a CA
in your area there in Albuquerque you could go to faith.
Com our website that's faith. Com and when you do
(16:38):
a search for a certified Kingdom advisor in the investing area,
you're you'll be asked to indicate whether you want a
full listing of CaaS or only those that offer faith
based investments. And you would be able to make that
selection and then be presented with a list to then
go interview. Uh, you could go directly to some of
the asset managers in this play, this space. That would
(17:01):
be another option. But if you're looking for an advisor,
I think a CA in the faith based investing space
would give you what you need. Uh, many of them
will be at Edward Jones. And so you could stay
right where you're at. It just may involve switching to
a different advisor. Um, Mark, anything else you might want
to add to that?
S2 (17:20):
Yeah, I think, Craig, the biggest thing is to, um,
if you are looking for an advisor, is to talk
to a few different ones and get a sense of,
of their investing approach and their style. And very often
people will find that, you know, in the course of
those conversations that one of those just kind of clicks
(17:40):
with you that it, you know, feels right, that that's
the approach you want to take. And, you know, that's
the advantage of talking to a few different ones is
if you just call one person and go with the
first person you talk to, then sometimes you're you're not
necessarily super well aligned. And that may not be as
obvious as after you've had a few of those conversations.
(18:03):
So that would be the only thing I would add
to what Rob said. I think the rest of that
is right on. Um, call a few, talk to them, and,
and try to find somebody that that seems like they
have an approach that really gels with how you want
to invest.
S1 (18:18):
Excellent, Greg, we appreciate your call today. Call anytime. Uh,
down to Fort Lauderdale. Hi, Marie. Go ahead.
S6 (18:25):
Hi. My name is Marie. Hello?
S1 (18:29):
Yes, ma'am. How can we help?
S6 (18:31):
Oh, hi, Rob. I'm so. I love your show. I
listen to it every day. I'm 81 years old, and
I learn something new every day.
S1 (18:40):
Well, I'm so thrilled to hear that. That's very kind
of you. Well, I'm glad you decided to call in.
How can I serve you today?
S6 (18:47):
I have a new an annuity. I, I don't understand.
It has a death benefit. I took it out in
the year of 2000. And this is like 2020, 25
years later. And I don't understand it. And I don't
understand the jargon that you use. And I don't know
what to do about it. I don't know if it's
a good investment. I mean, I've had it since 2000.
(19:10):
I don't know what to do.
S1 (19:11):
Yeah, yeah. Well, it's a great question. And Mark Marie
is not the first person to be confused by the
fine print on an annuity, huh?
S2 (19:19):
Yeah, that's for sure. Unfortunately, they do tend to be
kind of complicated. And that's one reason why when people
are evaluating whether to buy an annuity. A lot of
times Rob and I will will counsel that that that
is one of the potential downsides is all the the
watch outs and and gotchas that can be loaded into
(19:42):
those contracts. As far as what you've got now and
what your options are. Um, you know, a lot of
times the, the best approach is if you can, um,
find an expert that can walk through that with you,
that's that's obviously ideal. Um, sometimes people can do that
(20:03):
even maybe by finding a financial professional at their church
that might be willing to take a look at that
with you. Um, you know, if you have accounts that
you want managed, um, you know, often you can bring
this as part of, you know, your overall situation to
a Sica or another financial professional. Um, you know, of
(20:24):
course you can try to get some of that information
from the annuity company themselves. Um, you know, we have
some articles, Marie, on our Sound Mind Investing website about
annuities that could help you maybe formulate a list of
a few questions to ask the annuity provider, um, about
(20:46):
how things are structured within your policy. Um, but it
is a tricky situation. There's no question about that. Rob,
what are some things that have worked well in your experience?
S1 (20:58):
Yeah, I think you nailed it, Marc. And that is Marie.
You really need an advisor who can help you navigate
that fine print. Look at what do you have? It
may be that where you're at is the very best
place that you know this is going to meet your
needs in terms of safety and security. It gives you
the ability to convert it to an income stream. You're
not at the risk of the market. You also may
(21:20):
discover that there's a better place for you just given
your giving your goals and objectives? But I think it
really would not be something we could do over the radio.
And an advisor could really help you understand what do
I have today? And then in light of where I'm going,
what are my best options? So, um, let's do this.
Why don't you stay on the line? Our team will
get your information. I'd be happy to have somebody from
(21:41):
Kingdom Advisors call you. Do a search for case. They're
in Fort Lauderdale and help you pick the right one.
Stay on the line. We'll get your information. We appreciate
your call. We'll be right back.
S7 (21:59):
Great to have you with us today on.
S1 (22:01):
Faith and finance live here on Moody Radio. I'm Rob West.
S7 (22:04):
With me today.
S1 (22:04):
My friend Mark Biller. He's executive editor at Sound Mind Investing.
We're talking about foreign investments today and why you should
consider having some exposure to foreign investments in your portfolio.
In just a moment, Mark will share, in addition to
what he's already shared, a few of those key reasons
highlighted in the article we're discussing today. By the way,
(22:25):
if you'd like to read the whole thing, just head
to Sound Mind investing.org. Click on the article time for
Foreign Stocks to shine. Again, that's sound mind investing. Back
to the phones though. Don is holding there in Illinois.
Go ahead sir.
S8 (22:42):
Yeah. Thanks, Rob. I want to ask Mark a question. Uh,
I was thinking about, uh, allocating some money, uh, differently.
And I've been watching the international, uh, mutual fund that
I kept an eye on. But it's the International Value fund,
and it's been doing really well. And I like what
you said, that it might not be too late to
get in on the party. So what's your opinion on
(23:03):
international value funds?
S1 (23:05):
Excellent, Mark.
S2 (23:07):
Yeah, Don, I like it a lot. Um, we actually
recommended a particular international value fund at the end of
March in our, our upgrading strategy, which is one of
our actively managed approaches. Um, so I'm definitely on board
with the idea of international value. And I think that
(23:27):
right now, in particular, as I was mentioning earlier in
the program, you know, a lot of foreign companies have
just been ignored to the point where there are some
tremendous values out there. Um, internationally. And I've heard other, uh,
fund managers, you know, talking about how the types of
(23:51):
opportunities that, uh, really have just not been available in
US markets from a valuation standpoint for many years. Um,
we're starting to see those types of, uh, valuation opportunities, um,
in foreign markets. So I think there's a lot to
like there. Don. Um, now it is important. I hope
(24:15):
that I'm not coming across, Uh, wrong. In in that.
I'm definitely not suggesting that people get rid of all
their US exposure and go 100% into international stocks or
anything like that, but from the starting point where most U.S.
investors are today, which is that they have either no
(24:36):
international exposure or very low. I think that, you know,
adding maybe 10 to 20% of their stock portfolio into
international stocks makes an awful lot of sense today because
of the valuation disparities as well as some of the
other immediate catalysts. So I like the sound of it. Don. Um,
(24:59):
anything to add?
S1 (25:00):
No, I think that's great, Don. Hopefully that gives you
what you're looking for. It sounds like you're on the
right track there. Thanks for calling. Mark, you mentioned the
upgrading strategy. And this is really a unique offering for
folks that want to kind of keep control over the
buys and sells without delegating to an advisor, but wants
somebody making those more active mutual fund recommendations as they move,
(25:23):
you know, in line with the momentum and technicals of
the market. Will you just give a 32nd, uh, overview
of that?
S2 (25:31):
Yeah, absolutely. So we are, uh, trend followers. We use, um,
rules based strategies. So we're not, you know, sticking our
finger in the wind, saying, well, I like this idea.
I like that idea. Now we're we're actually monitoring the
market's own trends and prices. And that does lead us
(25:51):
sometimes to move money from one part of the market, like, uh,
small company U.S. stocks into another part, like foreign value stocks.
And so that is a process that we, you know,
we watch the market month by month. And in our newsletter,
we will say very specifically for our members, uh, it's
(26:13):
time to sell fund ABC and buy fund XYZ. And
so our our members, um, don't have their money managed
by us necessarily the newsletter folks don't, but they get
those instructions each month in the issue of SMI. And
then they log into their own accounts at Schwab, fidelity,
(26:37):
or wherever they have their account, and they make their
own transactions. So they are fully in control of all
of their own trading and their own accounts. Um, but
they're getting that do it yourself with help from us,
and that we're the ones that are, uh, telling them
when it's time to make a move and exactly what
(26:59):
that move should be. So it's kind of a good
middle of the road for somebody who maybe doesn't want
to turn everything over to an advisor and have them
do it all, but they don't feel confident that they
know exactly what to do Themselves. It's kind of a
middle ground for those do it yourselfers.
S1 (27:16):
Yeah. That's helpful. Thanks for that. Uh, let's go, uh,
to West Palm Beach, Florida. Emilio, thanks for calling. How
can we help?
S9 (27:24):
Good afternoon, gentlemen. Thank you for taking the call. Um,
discussing foreign investment. Investing. Are there any faith based foreign?
Foreign investing?
S7 (27:35):
Yeah.
S1 (27:36):
Many of the fund families that we talk about, uh,
have faith based, uh, well, their their faith based fund families,
but they have international, uh, funds as a part of
their overall fund mix. That would include, uh, guidestone the
Guidestone international equity. Eventide. Uh, one ascent has the one
ascent international equity. Praxis has the Praxis International index. Uh,
(28:01):
Timothy has an international Crossmark has an international as well
as inspire. So just about all the fund families you'll
hear us talking about have an international fund as a
part of their mix and their expressly faith based in
their approach. Mark, anything else you would add?
S2 (28:17):
No. You are a fount of knowledge. I'm impressed. You
can just rattle all this off. That was great.
S1 (28:24):
Excellent. Well, Emilio, is that helpful?
S9 (28:27):
Yes, sir. Thank you, I appreciate it.
S1 (28:29):
All right. Absolutely. 800 525 7000 is the number to
call Mark Biller here today. Taking your investing related questions. Uh, Mark, let's, uh,
dig into just a couple of those additional factors that
you're seeing that would give rise to why we shouldn't
overlook foreign investments in our portfolio.
S2 (28:49):
Yeah. Rob. Well, one of the most important ones, uh,
is that government spending trends are really reversing. So we're
all aware that here in the US, we've had a
focus on Doge, on trying to get our budget deficit down. Um, well,
as part of the negotiations, again, going back to that
(29:10):
defense situation, um, where we're wanting, um, our allies to
spend a lot more money on their own defense. A
lot of those countries that did not spend as much, uh,
their governments did not, I should say following Covid, they're
all of a sudden ramping up their government spending. And
(29:31):
if there's one thing we've learned in the few years
since Covid, it's that that government spending, you know, when
we think of government spending, we don't always think it through.
But that money, where does it go? Well, it usually
goes to companies in those countries. And so as we're
cutting back on our government spending, our government spending over
(29:52):
the last 3 or 4 years has been a huge
boost to the US market. Now we're reversing that. We're
seeing those spending flows happen in other foreign countries, and
it's reasonable to assume that those fiscal impulses will be
a big boost to those foreign stock markets. So that's
(30:12):
one of the immediate catalysts to look at, to say
why we think foreign markets are ready to roll.
S1 (30:19):
Yeah. And as Mark said a moment ago, this is
not about selling out of the US to go only foreign.
But why if you've overlooked the foreign markets through stocks
or mutual funds or ETFs, it's a part of a
properly diversified portfolio. And now might be a really opportune
time for that portion of your portfolio. Check out this
(30:40):
article time for Foreign Stocks to shine. Sound mind investing?
Org back with Mark Miller in our final segment after
this break. Stay with us. Hey, great to have you
with us today on Faith and Finance Live. By the way,
if you listen to the program regularly, perhaps you're a
super fan like Marie who called a moment ago. She
(31:03):
listens every day, loves the program. We're so thankful when
you call and you tell us how God has used
this program and the council that you've heard and the
guests that we have as an encouragement to you, and
perhaps that you've been able to take away something practical.
We'd invite you to become a faithful partner. If that's
you and you listen regularly, you can do that at Faith.
(31:25):
Com just click give. We send our partners for quarterly
ministry updates as well as our quarterly magazine, Faithful Steward,
chock full of just incredible, rich, beautifully designed content to
encourage you in your stewardship journey and all areas of
your financial management. We also send you pre-release copies of
our studies and devotionals when they come out two per year.
(31:49):
This would be a great time to become a partner,
because we're preparing in the month of May to send
out issue two of Faithful Steward and our new study,
Wisdom Over Wealth 12 lessons from Ecclesiastes on Money, a
deep dive into the Book of Ecclesiastes That will be
a surefire encouragement in your financial life. You can head
(32:11):
to faith.com just click give. To learn more. Let's head
back to the phones. We're going to go to Cleveland, Ohio.
Lynn's been waiting patiently. Go ahead.
S10 (32:20):
Hi. Thank you so much for your program and I
really have appreciated it. Well thank you. I'm calling. I'm
a widow for two years, and, um, I'm a little
jumpy with the economy. I have most of my, um, portfolio,
(32:41):
if you would, is with work. IRA and I had
upped my amount that I've been putting into it to 18%
of my income. Um, I will be able to get
my husband's or my widow's pension in another about three years.
(33:02):
I'm 64. Um, so I will have that. That won't
be enough to retire on, so I'll plan to continue
to work, um, to supplement it. But my question is, um,
if I should decrease the amount I'm putting in my
IRA to from 18% to 10%, I have a 6%
(33:26):
match at work and put the extra money into a
high yield savings account. I would like to retire when
I'm 69, and then I would, um, and I don't
want to take my own Social Security until I'm 70. Yeah. Um,
(33:47):
so for that one year, I would need some cash available.
I do, I do have a financial advisor, and they are, um,
it's fidelity, but they are using the The international stocks
to try and kind of cushion the things going on
in the economy.
S1 (34:07):
Yeah, well, that was a really helpful overview, Len, and
you're doing a great job. It sounds like you've got
a lot of great pieces in place. Let me just
clarify a few things. So you're 67 now planning to
work for another two years. You'll have one year between
69 and 70 where you'll be funding, you know, 100%
of your monthly need for your lifestyle out of your retirement,
(34:30):
401 K because you're going to delay, which I like,
delay taking Social Security to age 70. Is that correct?
Did I have that right?
S10 (34:39):
Yes. Um, correct. Except I'm 64. And um, so I
have a couple extra years of working.
S1 (34:47):
Okay, great. So you've got, uh. Yeah. So another five
years before you're planning to retire. What is your balance
in that 401 K right now?
S10 (34:56):
Uh, about 450,000.
S1 (34:59):
Okay. And you said you're putting in 18% in the
company's matching six, and you're looking at perhaps dropping it
to ten to boost your high yield savings. What do
you have in savings today?
S10 (35:11):
Um, right now in savings, I have, um, well, between
checking and savings, I have about 35,000.
S1 (35:19):
All right. And what do you spend in a typical month?
S10 (35:21):
My emergency. Uh, about, um, 4000.
S1 (35:28):
Okay. Got it. Yeah. So, I mean, at this point,
with 35,000 in the bank, uh, you've got, you know,
almost nine months worth of emergency reserves, so that's great. Uh,
it sounds like you're properly diversified. I know you mentioned
you even have foreign stocks. I mean, Mark, I'm thinking
if she can continue to put away at this level 18%
(35:48):
plus the match for these next five years, she should
be in, you know, pretty good shape. I mean, let's
say that grows to 600,000, uh, you know, pulling 24,000
a year is a no brainer. Perhaps even, you know,
as much as she needs. With 4000 a month, maybe
that drops to 3500. Uh, for that first year shouldn't
(36:10):
be a big deal, because then that would largely be
offset by Social Security. But what are your thoughts?
S2 (36:15):
Yeah, I agree with all of that, Rob. The one
piece that I think may make a little sense for you, Lynn,
is if you're looking to kind of split the difference. Um,
you know, I'm kind of reading into your question that
maybe you're a little nervous about markets and whatnot, which
might be one reason why you want to decrease the
(36:36):
investment part and move some of that into savings, which
is is safer. Um, you know, one option that could
kind of bridge that gap a little bit would be
to add a small gold allocation to your holdings. Um,
that can give you a little bit more upside and
a little, a lot more protection against the potential of
(36:57):
higher inflation, which higher inflation is one of the big
reasons why you wouldn't want to overdo the savings that
could lose ground if if we do see a little
higher inflation rate in between now and when, you need
to use that savings. So a small allocation there, which
you could, could do if you have an IRA, you
(37:20):
could could add some there, maybe even within the 401
K depending on your options. But that might be a
nice little supplement. And I'm not talking about a huge amount,
but somewhere in the, you know, 5% range or something
like that, that might be a nice option that you
could kind of think of as savings. It's going to
move around more than a savings account would for sure,
(37:42):
but it would give you a little bit of inflation
protection while you continue to build both of these other
pieces that we've been talking about. That's really the only
other thing that stands out to me, though, Rob. Um.
S1 (37:54):
Yeah, I like that a lot, Lynn. I don't know
that you mentioned you had some foreign stocks, but, uh,
and if you said this, I apologize. But what is
that breakdown in your 401 K between stocks and bonds?
Do you know, percentage wise?
S10 (38:07):
Hi. Yes, I'm at 60, 40.
S1 (38:11):
60 stocks or 60 bonds.
S10 (38:13):
Stocks and 60 stocks and 40 bonds.
S1 (38:17):
Okay. So yeah, I guess that would be the only question. Um,
I mean, that, uh, is a little rich just from
a typical allocation mark for somebody five years out from retirement.
But what are your thoughts on 6040 with 40 being
in stocks?
S2 (38:32):
Yeah it is. And under normal circumstances, I would probably
be a little more inclined to maybe add to the bonds.
I don't love bonds here right now, Rob, honestly, because
as we've seen over in the last couple of weeks,
bonds are acting weird right now. You know, we've had
stocks falling. We've had economic growth falling. Normally that would
(38:53):
be good for bonds. And yet we're seeing longer term
bond yields rising at the same time. So um, I'm
not sure I would would love to, to bump up
that bond exposure a lot here. But there again, not
to beat the same horse, but in some respects that
gold piece might be a nice little, uh, additional holding
(39:16):
where maybe it goes to like a 55% stocks. You
hold on to the 40% bonds and you add that 5%
in gold or some other investment similar to that. That
might be a good diversifier for you, I think.
S1 (39:32):
Big picture, Lynne, you're doing great. You're on the right
track here. And just based on the limited information we have,
it sounds like we're saying stay the course. And perhaps
to Mark's point, if you're going to do anything, maybe
add some gold exposure either through the 41K if you've
got it, or if you also have an IRA, you
certainly could do it there. And you could even look
at one of the the tracker ETFs without having to
(39:53):
buy the physical gold like GLD. Or, you know, there's
maybe a dozen of them or more. So hopefully that
helps you. We appreciate your call. Quickly to Spokane. Uh, Arlene,
we have just a minute and a half. Go ahead.
S11 (40:06):
Good. I'll be really quick. Thank you so very much.
You guys have got an awesome program that we all
get to benefit from. I have two quick questions that
you can ask. Doing some recent investing. And I see people,
professionals that have all different kinds of initials behind their name,
like CLU, C, certified financial planners, different types of financial advisors.
(40:29):
Could you give me definitions, maybe for those types of, um,
professional people? And who would be a good one to
look for for general investing? And the second question that
I had was about that list of percentages. How much
of my portfolio should go for precious metals? How much
should go into savings. How much should go elsewhere?
S12 (40:52):
Yeah, and that's it.
S1 (40:52):
Let me let me start with the first one. I'll
get Mark quickly to weigh in on the second. Uh,
you know, you're typically going to hear a few terms
when it comes to investment professionals. You're going to hear Aria,
which stands for Registered Investment Advisor. You'll also hear, uh,
you know, financial advisor or broker dealer, and then you'll
hear wealth manager. Any of those can be great. I
(41:14):
think the key is typically what folks are looking for
is something called a fiduciary, where they're required to put
your interests ahead of their own. Um, and so we would,
you know, say that on top of that experience and
that status as a fiduciary. Caixa is the designation we like.
It's our designation. It's the only one in financial services
(41:37):
for investing professionals that can bring a biblical worldview. And
they've met all kinds of other requirements experience and character
and competence and, uh, pastor Past a reference client. References.
They've been through a training program, a regulatory review. So
it's a pretty robust designation that's going to give you
a lot of confidence that this is somebody that not
only matches your values, but also can can bring a
(42:01):
wealth of experience. You can find a CX in your
area when you head to faith. Com and just click
Find a Professional. Unfortunately, we're not going to be able
to get to that second part, but Arlene, I'd love
for you to call back on a future broadcast. Uh, Mark, uh,
just about out of time, but so appreciate you and
all that you and the team do at sound mind investing.
(42:22):
Thanks for being here today.
S2 (42:24):
Thank you. Rob.
S1 (42:25):
All right, folks, if you want to check out this article,
I'd encourage you to do so. It's a great read.
Just head to Sound Mind investing.org and look for time
for foreign stocks to shine. Uh, big thanks to Tahira, Jim, Dan,
and Deb. Faith in finance lives a partnership between Moody
Radio and Faith fi. We'll see you next time. Bye bye.
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