Finding the Right Financial Advisor

But we won't be taking your calls today because we're prerecorded. This is faith in finance. Live. Biblical wisdom for your financial decisions. Well, Sharon Epps is with us again today. She's president of Kingdom Advisors and a regular contributor here on the program. Sharon, great to have you back.

The goal is to find someone who doesn't just respect your values but shares them. There's a big difference between an advisor who's a Christian and one who actively discusses financial decision making with a biblical lens.

your process for creating a financial plan. And they should be able to outline a clear step by step approach with the timeline and information required and the fees.

in advance. You won't want to miss those, but first, let's tackle a couple of emails. These come into us regularly at Moody Radio.com. This first question comes to us by way of Hannah. She writes, we recently sold our house for a good profit and we're wondering how to tithe on it. Do we tithe on the full amount we received or only what goes above the initial price and interest we paid? You would tithe on the difference between the sale price, Hannah, and the initial purchase price.

So you don't have to look at anything else other than what is that true increase in the value of the property. Because when we're giving a tithe, it is based on the increase, the profit. So no matter what asset it is, whether it's a stock or a piece of real estate, it's simply the difference between the sale price and the original purchase price. That increase, then you would apply a 10% tithe and then give that to your local church. I think that's a great idea. This

next one comes to us from Karen. She writes, I have a 401 K and I'm wondering how I can invest according to my values with the options that are available in it. It seems like the only options are big companies that I'd rather not be invested in. Do

you have any suggestions? Well, yeah. If you don't find one of the faith based investing fund families in your 401 K, now I would contact your 401 K custodian and tell them that you're interested in values aligned investing and that you'd like to suggest the addition of some of these fund families like Praxis, like Timothy plan like

Eventide like one ascent or Guidestone. It may not happen right away, but as they start to hear from more and more of their 401 K account holders, they're eventually going to add those, and they're always reevaluating what new funds need to be in the plan. So just because they're not in there now doesn't mean they won't be in there next year. And so I would reach out first. Second. You can also see if you have something called a

brokerage window. That's just simply the opportunity for you to invest beyond the menu of choices in your 401 K. In anything that's available through that custodian. And odds are if it's a Fidelity or Schwab or one of the big brokerage firms, you'd be able to get access to one of the faith based investing companies. The third option just put enough in your 401 K to get the match, and then put the rest up to the annual contribution

limit in a Roth IRA or a traditional IRA. And then you most certainly could invest in the faith based investing fund families when you do that. All right. Let's get to those phone calls that we lined up in advance right now. We're going to begin in Florida today. Hi, Chris. Go ahead.

an IRA that that my broker has set up for me. And, uh, what I'm wondering from your expertise is, is that, um, is that the best way to go about financing these projects so that I can remain debt free and I don't have to finance anything and incur any interest?

just what that withdrawal rate looks like. To ensure that we can keep this IRA around for as long as possible, to the extent that Social Security alone is not enough to cover your living expenses, especially as some of those expenses can grow in the future, namely around long term care and medical related expenses. So what what is your balance roughly on that IRA? And then if you look at the last 12 months, how much have you pulled out?

So I'm very frugal with my money, and I kept that distribution from 2024 around in case I came up short or got hit with any unbudgeted expenses that would put me over the over the ability to pay with the 1900 a month Social Security.

it's down. You know, it may be back close to the million, depending on kind of what your allocation is, but I'm okay with that. You know, I think just in terms of a rule of thumb, if you were to think about limiting and you've, you've, you know, gone far under this, which is great limiting to your annual distributions to, you know, no more than 4% a year, which would be on your case, 48,000 on the 1.2, obviously a little less than that if the balance has

come down. But as long as you're staying under that, that's why this money is there. I think you're taking out an appropriate amount. So it should continue to grow despite these withdrawals. And the last thing we'd want to do is take on debt, you know, and pay interest when you've got this money sitting there for this purpose. So, you know, I think you're in great shape. I'd say

continue to do this. And given how little you're pulling out, I think you've got, you know, even a bit more room there, um, for you to do other things, you know, if you wanted to do some work on the house or take a trip or something like that.

Rob West, your host. Now our team is away from the studio today, so don't call in. But we lined up some questions in advance that I know will be helpful to you. Had a great call there just a moment ago, and we were able to finish up off the air a bit more as we talked with the previous caller, just about, you know, how we can manage

the money that we have in that retirement season of life. Uh, you know, as we as we chatted with Chris, I mean, he's in a really strong position, really being judicious about what he takes out of his IRA. But that's what that money is there for. Now, I hit on something right there at the tail end that I want to make sure to circle back on, because I think a lot of people miss this, and that's the opportunity once you're 70.5, to do what's called a qualified charitable distribution,

this is specifically money coming out of an IRA. Can't be a 401 K. It's got to be an individual retirement account in a traditional, um, but you can take money out of that, which normally, you know, the money goes into that traditional IRA either by way of rollover or direct contributions pre-tax. So you remember, the money that went into that account was excluded from your federal and state taxes. So you got the deduction on it. And then normally you pay tax on it as income when

it comes out. The only way to get the money out tax free, which means it went in without paying any tax on it. It's also coming out without any tax is when it goes direct to charity or your church. And when you use that qualified charitable distribution, you're getting that money out of that IRA and you're never paying tax, which means you get to satisfy your required minimum if

you have it. Or at the very least, you get to hang on to cash you've already paid tax on in your checking or savings account and just have that money go straight from your IRA to that ministry or charity. And it's a huge opportunity because now you've got more going into the kingdom because there was never any tax paid on it, which is just an enormous blessing. And so a lot of folks will just say, you know what?

I'm giving X amount for my checking account every month to my church, or I might be sending a systematic contribution here to Faith Fi, but instead I'm going to have that money instead of going out of after tax accounts, I'm going to come out of a pre-tax account through the qualified charitable distribution and go straight to that ministry and never pay any tax on it. What an opportunity. So don't miss that. If you're 70.5, you can do up to $105,000 out of an IRA through a qualified

charitable distribution. You just call your broker or your broker dealer, like Schwab or Fidelity or Edward Jones or Merrill Lynch, whoever you have your IRA with, and just say, I want to do a qualified charitable distribution. They'll send a check straight to the ministry. Let them ministry know it's coming, and then you can report that on your 1040 that yes, it was a withdrawal, but it gets offset on the line below it because it was a qualified charitable distribution.

And so no tax is paid even though the withdrawal occurred. So don't miss that. It's a phenomenal opportunity for you that are in that fourth quarter of life. You've got IRA money and you want to give generously. All right. Let's get back to the phones. Let's go to Maryland. Hi, Ingrid. Thanks for your patience. How can I help you?

balance it all. And perhaps if, if you'd be willing, they could help you look at all the look at the income you have, look at the bills you have and develop a plan for how you cover each of these bills throughout the month. Now, the extent to which there's just not enough money there to make it go around, we're either going to need to try to cut back or eliminate some of those expenses, or find a way to get some additional income. That may not be possible,

but it's it's the other side of the equation. But in either case, they can be an encouragement to you, pray with you, and just look at the overall situation and help you figure out how to manage it. So, uh, would that be helpful for me to have somebody give you a call that could help you navigate all of this?

but I'm confident they'll be a blessing to you. And I'm going to ask the faith and finance community to be praying for you as well as you steward God's resources. Sounds like you're doing a great job. I realize it's not easy, but, uh, we want to help you along the way. So stay that right there and we'll get somebody in touch with you. Well, folks, before we head to this break, let me remind you, if you haven't checked out faith. Com. That's faith. Philly.com. I'd love for

you to do that. You'll find the best content in biblical finance there for you to grow in your understanding of managing money God's way. You'll find our community and the money management system. It's all there at Faith. Philly.com. Now, again, a reminder we're not here today, but more of your questions that we lined up after the break. Great to have you with us today on faith and finance live. By the way, we're not live today. We're away from the studio, so don't call in. But we have some

great questions that we lined up in advance. By the way, this ministry is entirely listener supported. That means we rely on your financial gifts and support to do what we do on the air every day. If you consider a gift, we'd certainly be grateful. Just head to our website. faith Philly.com. That's faith. Dot com and click the give button. Thanks

in advance. You know, periodically we hear from folks that, uh, write into us via email and we try to tackle a few of these questions, uh, whenever we're able to. Let's do a couple of those right now. Uh, this first one comes from Lori. She writes, I will be full retirement age in August. I'm still working, so my Social Security will be a surplus that I want to put toward my home. I still owe $82,000 on it, but I also know that it needs a lot of repairs.

Does it make more sense to put this extra cash flow for repairs, paying down the mortgage, or a little bit of both? And I would just say, Lori, first of all, if your home does need repairs, um, let's determine, you know, first of all, are they imminent or are they, you know, more renovations? If they really are truly repairs, we probably want to go ahead and get those done. Uh, just so we don't cause any damage to the home. So I would say this surplus income is a great

opportunity for you to do that. I would start there now. Obviously, the ability to fund any of that, you know, out of, uh, you know, any other cash flow is great. But I would see all of the surplus that you have, including the Social Security, as a way to fund those repairs without taking on debt. Um, so I think that's absolutely the priority use of that. Um, I would say after that,

let's make sure we've got a fully funded emergency fund. Um, you know, as you head into retirement, I'd love for you to have a good six months living expenses, if not a little bit more in that season of life. And then once those two goals are met, um, you know, I would say the home repairs are fully funded and you're back up in kind of working order. Um, you've got your fully funded emergency fund. Then let's take that

money and put it toward the mortgage principal. That will, of course, reduce future interest costs and give you more cash in retirement. Once you can pay off that house and reclaim what is probably your largest expense. Uh, the second one is a question that we've got here is from Mikisha. Here's what Mikisha writes. What's the difference between getting a debt consolidation loan or working with a debt counselor? Well, this is a great question, and it's one that comes

up a lot. Um, debt consolidation versus what I'll call debt management. So debt consolidation is a loan. It essentially is where you roll multiple debts into a single new loan. Typically with a lower interest rate. Now you're still fully responsible for repayment. And you'll need good credit to qualify

for favorable terms. It's also dangerous, though, because what I experience is that most folks who get a debt consolidation loan, uh, end up doing so to take the pressure off without actually changing the habits that led to the debt in the first place. And so you've got to identify what was the root cause. Am I just treating a symptom? The debt because of lifestyle spending beyond my means? Or

am I truly, you know, resolving the situation? I've already handled the habits, and now I'm just looking to, you know, eliminate the debt as quickly as possible with as little interest as possible. Typically, this is just my experience. Typically, what I find is most people that get a consolidation loan haven't done the hard work to change the habits that led to the debt in the first place. So then they call me back six months later and say,

all right, Rob, now I've got the consolidation loan. And guess what? The credit card debt is back. So I want to avoid that. Um, now when it comes to debt management, that is my preferred way, without a doubt, for you to get this paid off once and for all. Keep in mind, when we do the debt consolidation, roll everything together, even if there's a lower interest rate, typically

we have a longer payback period. So what that just simply means is if we have a lower rate but we pay back over a longer runway, you know, we're probably going to end up paying the same amount anyway. And that's one other reason I don't like it. With debt management, the debt stays right where it is. If you're with Capital One on a credit card, you're going to stay with Capital One. You're at Citi, you're going

to stay with Citi. But what happens is each of these credit card companies have a department they call credit counseling. And they all have an approved interest rate. And it's always lower than the prevailing rate typically. Keep in mind, the average interest rate right now is about 23%. Typically credit counseling rates are between 0 and 10%, often between 0 and 8. So a dramatic reduction, you know, in

many cases 50% less or more. Um, and so that's great because that just means now I've got a larger percentage every month with the same payment going to principal reduction with that lower interest rate. The other key is you have accountability because you're paying through Christian credit counselors. Thirdly, they're going to help you do a budget that's great. That's just an added benefit. And then fourth, and this

is a big one. Don't miss this. You know what happens with credit counseling is you have a level monthly payment. See if you've ever been paying back credit card debt. You've probably noticed that as the balance comes down, the minimum payment comes down because it's a percentage of the balance. Well, what's your, you know, likely response to that? Well, I'm just going to pay as little as possible because I don't see myself getting out of this debt anytime soon.

So I might as well put that money to other good use. Well, that just extends the repayment period. But with credit counseling, you have a level monthly payment that fits into your budget. And because that payment doesn't come down with the balance every month, it's a larger percentage of the overall debt that was owed, which is great.

And you put those two things together, the fact that we've got a dramatically lower interest rate and the fact that we've got a level monthly payment, All of that together results in, on average, you paying that debt back 80% faster. That's a game changer. And so this is absolutely my preferred way. Now keep in mind there's many credit counseling agencies out there. They're all non-profit. They have to be.

But the one that we've worked with for a long, long time, and they've worked with literally thousands of our listeners, is Christian credit counselors. You'll find them on the web at Christian Credit Counselors. So Mikisha long answer to a short question, but I would stay away from debt consolidation. I would absolutely do debt management or what's called credit counseling. And I would use Christian credit counselors. Now, let me take just a moment and mention one other option that

I don't like, but folks will often use. And it's not debt consolidation. It's not debt management. It's a third option. It's called debt settlement. Now here's what happens there. With debt settlement, you will find a company. And by the way, there's a lot of bad actors in this space. So this is just another reason to stay away from it. But with debt settlement, they will ask you to stop paying your creditors. I know it's crazy. Uh, they're going

to tell you that. Well, if you stop paying, they're going to get into collections, and that's going to create the environment where we can come in behind you and negotiate a reduced settlement. But guess what? Number one, you're not honoring your obligation. And I think as Christ followers, we need to. Number two, uh, you know, you are putting yourself in a position where you're going to trash your credit because you're stopping payment. So you're going to

get into collections. You know, it could be charged off. There could be a judgment that's legal, a legal judgment against you. All of that's going to hit your credit report just creates a real mess. So that is not what you want to do. So bottom line, these are the three kind of most common ways people pay back debt debt consolidation, debt settlement and debt management. My preferred approach again, debt management and our friends at Christian Credit

counselors.org and help. By the way, if you have less than 4000, you probably don't need it. Just snowball it. Smallest to largest balance. Free up as much as you can in your budget. Put as much toward principal every month as you can. Got over 4000. That's where debt management really shines. Well, folks, we're going to take one more quick break and then back with our final segment today.

But if you need assistance from a financial or legal professional, we'd love for you to visit Faith Philly.com and click find A.K.A. again, that's Faith Philly.com and click find A.K.A. that stands for Certified Kingdom Advisor. Our preferred designation for financial advice from a biblical worldview. We're back with much more just around the corner. Stick around.

I love the program, I've benefited from it. I want more people to get this message. I'm not getting this anywhere else. And they say, I'll be in the boat with you to the tune of $35 a month or more now, as a way of saying thank you. And because we know that if you're a faithful partner, you want to be a good steward of God's resources. We produce some world class resources that we send out to our partners. But you would get four copies of our beautiful,

really thoughtful, magazine faithful steward. It's gorgeous and really incredible content. You get four issues a year mailed to your door. Plus, every time we come out with a study or devotional, which is typically twice a year, you'll get that mailed to you as well. So if you want to become a partner, just head to our website. Com click give at the top of the page and you'll find all of the details. All right let's round out the broadcast today as many calls as we can. Anthony thanks for

waiting patiently there in Wisconsin, sir. Go ahead.

hopefully this year. We have a purchase agreement already lined up. Um, Uh, the homeowners right now, actually, they're looking for a new house, and they have a home equity line of credit that they're going to use to purchase their home from the from the sale of the home that they're living in. And my question is, uh, the credit union that we're going through, they're offering us the, you know, the standard

30 year mortgage with one monthly payment. Yeah. But, uh, my wife and I, we we try to do extra payments at least once a month, maybe once every two months. And the loan officer said that they offer a biweekly payment plan. And I just wanted to get some of your insight on that. What would be better? Which one would be best? You know the pros and cons of both.

I like the biweekly payment option. And I'll explain for the rest of our listeners what that is in just a moment. Um, the only thing I don't like is if in doing that, by setting it up through the credit union, if they're going to charge you a fee, you don't need to do that because you can essentially do this on your own. Now, if they're willing to do it and not charge anything, that's great. The other thing is you don't want to have to do it.

You want it to be an optional thing. Because if forever, if for any reason you ever needed to just go back to the the one standard payment a year instead of the the half payment every, uh, you know, two weeks, you would want that option. You don't want to have to be forced into doing the biweekly payment. Does that make sense?

half payment every two weeks. Okay. Now when you make a half payment every two weeks, there are 26, uh, you know, two week periods in a year, which means you're making 13 monthly payments. You're making an extra payment every year. And so by getting into that, you know, biweekly option where you send a half payment every two weeks, essentially, if you can get into that rhythm you're going to every six months, you're going to send an extra half payment.

Every year. You're going to send an extra the equivalent of one full payment. That's great because again, that one extra payment a year makes a dramatic difference in the total payback of that mortgage. The key is I don't want to pay for the option to do that because it shouldn't cost you anything, and I don't want to be required to do that. But apart from that, I really like it. Is that helpful, though?

down payment, then it'll be a real blessing to you. Hey, thanks for calling today. Call anytime. We appreciate you being on the program, by the way. Stay on the line. I'm going to send you a copy of Faithful Steward. I think it'll be an encouragement to you. Uh, let's go to Texas. Hi, Lizette. How can I help?

which is pure insurance. You're simply paying the cost every month for the mortality expense, what it actually costs, based on the actuarial tables, to insure his life for a set period of time, based on his health and the amount of coverage that you want. But I suspect that 150,000 wouldn't be enough. But the nice thing about term insurance is, you know, maybe you get a ten year

policy on his life. So that between now and when you all retire, where at that point, hopefully you've got enough in the way of assets and income sources like Social Security, where you no longer need his income. Uh, he wouldn't have it anyway if he's retired. And then you don't need that insurance anymore, you drop it. But while he's still working, you've got plenty of insurance so that if he passes away, you've got enough to be able to, you know, fund your lifestyle for the rest

of your life. Well, the the most cost effective way for that insurance is term insurance. So here's what I would consider doing. And you know, remember we only have a couple of minutes together on the air here. So if you want to get an advisor to get in the middle of this, that would always be the better option. But just my kind of high level thoughts are let's

determine how much insurance you need. You know, what would it take for you to replace his income, at least between now and when, you know he was planning to retire instead of 150, you may decide that's 3 or 4 or $500,000, and then let's go see what it would cost to get a ten year term policy for that amount on his life payable to you. And then I suspect it's going to be perhaps less than the

policy you're already paying. And once it's in force. And that's the key, we wouldn't want to do anything until that policy is in force. But at that point, then you could cancel the whole life, reclaim the 19,000, maybe use that to shore up your emergency fund. And now you're no longer paying for the whole life policy. You've got the cash value to do something else with, and you have more life insurance for the next decade so

that if something happens to him, you're good. And then once you all get to retirement, you don't need that policy anyway, and you drop it. Does that make sense?

this quarter, it's the ministry heart for Lebanon. And, you know, let me take you to Psalm 82 as we wrap up here today. Verses three and four give justice to the weak and the fatherless, uphold the rights of the afflicted and the destitute. You know, as stewards of God's resources, we're called to invest in what matters for eternity. And an urgent need right now exists in the country of Lebanon, where girls face exploitation and early marriage and a future

shaped by fear instead of hope and our partners. Hartford, Lebanon is a Christ centered ministry that is meeting the needs of these young women, sharing the hope and love of Jesus, building up their identity which is preventing a lot of these tragedies that are involving exploitation. If you'd like to be a part of, uh, sharing Jesus with three girls, you can do that when you go to faith. Com.

Or text the word faith to 98656. That's faith to 98656. Well, folks, it's been a joy to be along with you today. Thanks for inviting us into your story. What a joy it is to encourage you with God's Word as you seek to be that wise and faithful steward. Our goal that you'd see God as your ultimate treasure. Let me say thanks to my team today. I couldn't do it without him. Amy, Dan, Gabby, T, and Jim. Faith and finance lives a partnership between Moody Radio and Faith fi.

Have a wonderful day and come back and join us next time for another edition of Faith and Finance live.