S1: Whether to buy a house or go to college are
S1: major financial decisions, but so is deciding when to take
S1: Social Security. I am Rob West, it's true. Tens of
S1: thousands of dollars, if not more, are on the line
S1: when deciding when to start taking Social Security benefits. Eddie
S1: Holland joins us today to help you make that decision.
S1: And then it's on to your calls at 800, 525 7000.
S1: That's 805, two five 7000. This is faith in finance.
S1: Live biblical wisdom for your financial journey. Well, we're excited
S1: to have Eddie Holland with us today. Eddie's a senior
S1: private wealth advisor and partner of Blue Trust in Greenville,
S1: South Carolina. He's also a CPA, a certified financial planner,
S1: and a certified Kingdom advisor. So a triple threat, so
S1: to speak. Eddie, great to have you on the program.
S2: Rob, thank you so much. I'm honored to be your guest.
S1: Eddie, this is a topic we get so often related
S1: to when to take Social Security benefits. Now, we usually
S1: advise folks to put off taking Social Security benefits at
S1: least until full retirement age, which is now 66 or 67.
S1: But we realize that isn't always the best for everyone.
S1: So I'd love for you to weigh in on what
S1: folks should consider when making this decision.
S2: Sure, and I'll start out by prefacing that this is
S2: not an exhaustive list, just some things to consider. I
S2: think the first thing people need to consider, Rob, is
S2: understanding that if they take Social Security before full retirement age,
S2: they will be subject to a reduction. However, delaying past
S2: their full retirement age, they will receive an annual increase
S2: that equals 8%. That's what Social Security calls a delayed
S2: retirement credit. So those are very important things to consider.
S2: Another consideration is cash flow needs. If someone retires, then
S2: there's obviously going to be potentially cash needs that arise.
S2: So they may start taking Social Security earlier than full
S2: retirement age because there's cash needs, income needs that they
S2: need to replace. We have some clients that we've advised
S2: that needed to pay down debt. And so if you
S2: have debt payment that you need to consider, that's another factor.
S2: We've had clients that have said, I just want to
S2: increase my charitable giving. And so I want to draw
S2: Social Security, start giving more even in retirement or potentially
S2: as a legacy gift. So that's another consideration. Um, one
S2: other factor to consider, and I don't mean to be morbid,
S2: but health is is obviously a consideration. People that, um,
S2: don't have longevity in their family line. They may start
S2: taking Social Security benefits a little earlier. Others that plan
S2: to live a long time or feel like they're very healthy.
S2: Generally speaking, the longer you live, the more you benefit
S2: by delaying Social Security, at least until full retirement age
S2: and possibly even later until age 70. Another factor, Rob,
S2: that I'll mention. I'll mention a couple more and then
S2: one that maybe is a little more nuanced. Legacy goals
S2: and inheritance. Most of the time, you can't pass Social
S2: Security benefits on to kids or charity, but you can
S2: your portfolio. So some clients have said, I want to
S2: earmark my portfolio for giving or for inheritance reasons, and
S2: I want to start drawing Social Security. Now, everybody loves
S2: to talk about taxes, but income taxes a component to consider.
S2: Federal income tax guidelines state that Social Security could be
S2: subject to tax. So we've had some clients delay Social
S2: Security until a year where they're going to be in
S2: a lower tax bracket. And then one of the more
S2: nuanced strategies that really came up a couple of years ago, Rob,
S2: was when the market was down significantly. We had had
S2: clients that had retired prior to full retirement age. They
S2: were starting to draw from their portfolio. They wanted to
S2: delay Social Security. Well, the market did not cooperate, had
S2: significant market drop. What the client then at that point
S2: decided was can I stop or pause my Social Security benefit?
S2: If you are younger than full retirement age and you
S2: have started drawing Social Security within the first 12 months,
S2: you can do what Social Security calls a withdrawal so
S2: you can withdraw your application. But a withdrawal application simply
S2: means I had a 12 month free look. Period. I
S2: don't want to draw it. I want to have what
S2: in golfing terms is a mulligan? Yeah, I don't want
S2: to start drawing it back. And it's as if you
S2: never drew it. The benefit of that is that you
S2: can turn it back on at a later point, and
S2: you're able to potentially act as if you never drew it. Now,
S2: that's a very nuanced strategy, something to consider before actually
S2: making that decision.
S1: That was so helpful. We're obviously going to have to
S1: have you back, but you gave us some really important
S1: things to think about as you consider the right age
S1: to start taking Social Security benefits. Eddie, we appreciate you
S1: stopping by today, my friend.
S2: Rob, thanks for having me.
S1: That was Eddie Holland of Blue Trust in Greenville, South Carolina.
S1: Back with your calls and questions on the other side
S1: of this break. The number to call is 800 525 7000.
S1: Call right now 800 525 7000. By the way, you
S1: don't have to call. Just send an email. Ask Rob
S1: at the letters phi.com. We'll be back after this.
S3: The opinions offered during this program represent the personal or
S3: professional opinions of the participants, given for informational purposes only.
S3: Any information provided is not intended to replace advice from
S3: a financial, medical, legal or other professional who understands your
S3: specific situation.
S1: Great to have you with us today on Faith and
S1: Finance live. I'm Rob West, looking forward to taking your
S1: calls and questions today. How do you get in on
S1: the conversation? Well it's easy, you just call 800 525 7000.
S1: Our team is ready for you. We'd love to have
S1: you on today to answer whatever is on your mind today.
S1: That pressing question in your financial life. Again, the number
S1: with lines open, although that won't last long. 800 525 7000.
S1: What do we do on this program each day? Well,
S1: we set aside an hour to encourage you in your
S1: role as a steward of God's resources, recognizing God owns
S1: it all. Money is a good gift from God to give,
S1: to meet the needs of others, and to love our
S1: neighbors and to solve problems. To expand and spread the gospel.
S1: To invest in companies supplying business with capital for human flourishing.
S1: To create goods and services that should be good and
S1: that love our neighbors. Also to enjoy. You know, I
S1: think God smiles when we use money to enrich relationships.
S1: Maybe for a joyful celebration that's a good use of
S1: God's money. But we also have to recognize that this
S1: good gift can actually rival our hearts with devotion to God. Remember,
S1: he said, you have to choose. Is it going to
S1: be mammon or is it going to be God? So
S1: money can be dangerous, just like anything where we worship
S1: the creation over the creator. But I think we see
S1: clearly in Scripture that we need to be on our
S1: guard with regard to money, not serving its proper place
S1: as a tool, but instead becoming an end rather than
S1: a means to an end. And so we want to
S1: encourage you in that each day and help you to
S1: put money in that role that it was intended to
S1: occupy you accept your role as steward and encourage you
S1: with very practical answers to the questions you're facing in
S1: your financial life, because we understand you're trying to manage
S1: it appropriately and save it regularly and give it away generously.
S1: And all of that comes with questions. What does that
S1: look like in my life? And I made some mistakes
S1: along the way. And how do I deal with those? Well,
S1: that's why we're here to be an encouragement to you.
S1: So call right now with whatever you're thinking about in
S1: your financial life today. That number again is 800 525 7000. Again,
S1: it's 800 525 7000. Let's begin with what's in the
S1: news today. The markets are moving up positively. The Dow
S1: Jones closed up 740 points. The S&P up 118 points
S1: a little more than 2%. The Nasdaq up 2.5% on
S1: the news that, uh, well, perhaps the Trump administration was
S1: wanting to make sure that they knew that or that
S1: you knew that they were not trying to harm Apple
S1: with the iPhone tariffs. They've also put a pause on
S1: the tariffs related to Europe. The European Union, that was
S1: a big deal. The market responding positively to that on
S1: top of consumer sentiment, how consumers are feeling about the economy.
S1: It was up higher than expected. All of that together
S1: snapped last week's losing streak, and we saw some pretty
S1: good strength in the market today. Again, most of the
S1: major indexes up close to or more than 2% today.
S1: That's a good sign. We'll get Bob's take on that
S1: Bob Dole. That is a little later in the broadcast
S1: when he stops by to weigh in on the markets,
S1: what's moving them and just the overall health of the
S1: US economy. But one of the things we want to
S1: do today is, though get into your specific questions. Also,
S1: if you have a testimony, I'd love to hear it.
S1: You know, we're always encouraged when you share what God
S1: is up to in your financial life. The way to
S1: do either of those, again, is to call right now
S1: 800 525 7000. Again, that's 800 525 Five. 7000. You know,
S1: when we think about managing money practically often, we get asked,
S1: what are those basic principles that we need to know
S1: coming from Scripture? You know, if I just do these things,
S1: I at least know I'm headed in the right direction. Well,
S1: I would give you five. I would say spend less
S1: than you earn. Sound simple? It's not. I get it,
S1: especially now with everything more expensive than it has been.
S1: But it's the key to every financial success that leads
S1: to having margin. Because if you live within your means,
S1: you're going to have something left over at the end
S1: of the month. That's the only way to fund your
S1: longer term goals. Then set long term goals. That's key
S1: because the longer term your perspective, the better your decision today.
S1: Avoid the use of debt because debt mortgage is the future.
S1: And give generously because giving breaks the grip of money.
S1: If you understand, God owns it all except your role
S1: as steward and apply those five principles, it doesn't mean
S1: you'll be free from worry or difficulty. We live in
S1: a fallen world, but you will put yourselves, I believe,
S1: in a in a position to experience God's best, and
S1: that's what we want to encourage you in each day.
S1: All right. Let's dive into those phone calls again. Calls
S1: are coming in now, but we've still got some lines open.
S1: 800 525 7000 is the number to call. We are
S1: going to begin today in Tulsa, Oklahoma. Hi, Christy. Go
S1: right ahead.
S4: Hi, Rob. Thanks so much for taking my call. Um,
S4: my concern is with, um, the investment of my employer
S4: adding into my 401 K. I've not yet been with
S4: my employer for a year. And in order to be
S4: fully vested, um, them adding to my 401 K, I
S4: have to be there for five years. Of course, you know,
S4: things are not always, um. Yeah. It's. Sorry. Anyways, my
S4: question is, um, due to the possibility that maybe I
S4: won't be there for, you know, at the five year mark,
S4: would it be wise for me to get a 401
S4: K outside of my employer?
S1: Yeah. Uh, you would not be able to get a
S1: 401 K outside of your employer because for one have
S1: to be offered by a plan administrator and you have
S1: to contribute to them through salary deferral. The only option
S1: you would have for a 401 K is what's called
S1: a solo K or an individual 401 K, but that
S1: requires you to be self-employed and it sounds like your W-2.
S1: You just haven't met that vesting requirement. Is that right?
S4: That's correct.
S1: Okay. Yeah. So your option would be a Roth or
S1: a traditional IRA. Um, are you familiar with those terms?
S4: I am, yes. And it's something actually, I've been trying
S4: to get my husband to do. Where? His 401 K.
S1: Okay. Yeah. So the the Roth and the 401 K
S1: are the account type. And then inside the account type
S1: is the you make contributions and then you have your investments.
S1: So a 401 K has to be apart from somebody
S1: who's completely self-employed. Uh has to be created by and
S1: administered by your employer. So that would not be an option.
S1: The IRA individual retirement account. That first letter I is
S1: the key. It's not set up by your employer. It's
S1: set up by you. So anyone can open an IRA
S1: and you can have one. Even if you have a
S1: 401 K, you're able to have both and you're able
S1: to contribute up to the maximum of both. Now, between
S1: the Roth and the traditional, you still cannot exceed the
S1: annual IRA contribution limit, regardless of how many different IRAs
S1: you put it in. And so you have to decide,
S1: do I want a Roth or do I want a traditional.
S1: Now the Roth IRA is simply money that you put
S1: in after tax. So you get paid, you pay the
S1: tax on it, and then you put the after tax
S1: contributions into the Roth. You don't get a deduction. You
S1: don't get it to to write it off against your
S1: taxes for that year. So why would you do that.
S1: Well the benefit of the Roth is it grows tax free.
S1: So all the growth between the time you contribute and
S1: when you pull it out, let's say in retirement you're
S1: not going to be taxed on any of that growth,
S1: which is a nice benefit. With the traditional IRA. It's
S1: just the opposite. The traditional you put the money in,
S1: you get the current year tax deduction. So you get
S1: a tax benefit now and then it grows tax deferred.
S1: And then when you take it out you pay tax
S1: on it as income. The contribution that you got a
S1: deduction on. Plus all the growth gets added to your
S1: taxable income in the year that you pull it out.
S1: So when you're younger typically better to use a Roth IRA.
S1: Now let's do this. I've got to take a break.
S1: When we come back I'll answer any questions you have.
S1: And then we'll talk about where you might want to
S1: open that. This is faith and finance live. We'll be
S1: right back. Great to have you with us today on
S1: Faith and finance live. I'm Rob West. We're taking your
S1: calls and questions today. 800 525 7000. That's 800 525 7000.
S1: We'd love to hear from you today. Christie was not
S1: able to hold. Let me just mention something to make, uh,
S1: make clear. So when Christie was referring to that vesting
S1: of five years for that 401 K, uh, that does
S1: not apply to her contributions. So when you make contributions
S1: to your 401 K, you're 100% vested. You own them
S1: right away. Which means if you leave the company, you
S1: take your contributions, uh, the employer contributions, the part that
S1: they add that would often follow a vesting schedule. And
S1: so it may be for, you know, it could be
S1: what's called cliff vesting where you get 0% for a
S1: set number of years, like in her case, five. And
S1: then you get all of it, or a graded vesting
S1: where you get a certain percentage each year building up
S1: to the fifth year in her case. But if you
S1: leave the company before you're fully vested, you would forfeit
S1: some or all of that employer match, but you would
S1: absolutely be able to take your contributions with you, which
S1: is just like the IRA. You're not going to get
S1: any matching in the IRA, but it's yours immediately. The
S1: same would be true with the 401 K. Now, if
S1: you don't have a Roth 401 K, though, Christie I
S1: if you're young, I would say go ahead and start
S1: with that Roth IRA and get that money going in
S1: after tax but growing tax free. Now if you bump
S1: into the IRA contribution limit for 2025, which is $7,000,
S1: then that's where I would go ahead and start contributing
S1: to that 401 K even prior to you reaching the vesting,
S1: because to my point, you don't have to worry about
S1: your portion. It's only the employer match. So hopefully that
S1: helps you just clear up. I know that can get confusing,
S1: but we appreciate your call today. Let's, uh, go right
S1: back to the phones. By the way, if you have
S1: a question, call right now 800 525 7000. We're going
S1: to go out to Coral Springs, Florida. I know it well. Hi, Jessica.
S1: Go ahead.
S5: Hi, Bob. And thank you for your service. Yeah, um,
S5: I'm considering going back to school for my doctorate, and
S5: I wanted to know, would it be wise if I
S5: take an equity credit, um, to actually to pay for
S5: my tuitions or just go ahead with the student loan
S5: that they offer me?
S1: Yeah. You know, I don't like that option, Jessica. And
S1: here's why. Um, you know, you're collateralizing that debt to
S1: your home. And so if something happened and you lost
S1: your job, or you had a disruption in income and
S1: you're not able to make that payment for a period,
S1: you've just put your home at risk, um, with the
S1: student loan, especially if it's a federal student loan in
S1: the same scenario where something unexpected comes a financial hardship
S1: of some kind. The student loan program, the federal one
S1: offers income based repayment options. So they're going to let
S1: you reduce your monthly payment equal to the reduction in
S1: income that you've had for a period of time until
S1: you can get back up to the normally scheduled payment.
S1: So there's a lot more flexibility there, as opposed to
S1: the line of credit, where there's not going to be
S1: that option and you've collateralized your home to the loan,
S1: which again, you know, carries additional burden or risk. So
S1: I wouldn't go there. I would stay away from that
S1: and exhaust the federal loan options. First. They're going to
S1: offer fixed rate. And those borrower protections are pretty nice.
S5: Okay. Thank you.
S1: Okay. We appreciate your call today. 800 525 7000 Sioux City,
S1: Iowa Marc. Go ahead sir.
S6: Hi. I have a question about mutual funds versus exchange
S6: traded funds. I don't really understand the basic difference. Um,
S6: I have $10,000 to invest. Everything else. My retirement, everything
S6: is fully funded. Um, we do have, uh, 2% mortgage,
S6: about 80,000 left on that. Uh, other than that, uh,
S6: I'm wondering, you know, what's the best thing to do
S6: with this money that I have to invest? I'm looking at, uh,
S6: robotics and AI, possibly as far as exchange traded funds.
S1: Okay. Yeah. So the key difference is, uh, Mark, and
S1: it's a great question. Um, you know, the the trading
S1: would be the first one. So ETFs trade like stocks.
S1: So you buy them and sell them just like a stock,
S1: you know, shares of Coca-Cola or whatever company you want
S1: to use. As an example ETFs trade just like stocks.
S1: As long as the exchange is open, you place a trade.
S1: If you do a market order, you're going to get
S1: the next trade comes to you and you know you
S1: buy it and sell it at any time. With a
S1: mutual fund, they trade once per day, and you get
S1: based on the net asset value of the fund, all
S1: the outstanding shares and all the the investments held divided equally.
S1: After the market closes. You get that trade once per
S1: day on the fees. ETFs are generally lower fees, mutual
S1: funds usually have higher fees, and they can have what
S1: are called sales loads commissions. Although there are no, you know,
S1: no fee or no commission, uh, mutual funds. But generally
S1: the fees are higher. Uh, tax efficiency ETFs are usually
S1: more tax efficient. Uh, mutual funds can trigger what are
S1: called capital gain distributions when there's a capital gain that incurs, uh,
S1: inside the fund and it's passed along to the shareholders
S1: and then the minimum investment. Um, the ETFs can be
S1: bought with as little as one share. Mutual funds might
S1: have a minimum investment. So you can understand quickly why
S1: ETFs are gaining and growing in popularity. Because they're less expensive,
S1: more liquid. So you can trade them more frequently. They're
S1: tax efficient and they usually have lower minimums. So if
S1: you want lower costs and flexibility I'd say go with ETFs.
S1: If you want more hands off investing or you want
S1: to buy into a particular mutual fund's actively traded manager
S1: where you're buying his or her expertise, you know that's
S1: where you may want to buy a mutual fund, although
S1: more and more mutual funds, you know, are spinning off
S1: ETFs that basically mirror the same investment strategy. So I
S1: would say, given what you're looking for, where you want
S1: to buy into a particular sector like AI or robotics,
S1: I think you're most flexible and cost efficient approach is
S1: going to be an exchange traded fund focused specifically on
S1: that sector of the market. The only thing I might
S1: warn you on, just as I wrap up here, would
S1: be just make sure you're not too highly concentrated. You
S1: want to be properly diversified, even though I think robo
S1: robotics and I have a great future. You just want
S1: to make sure that, you know, as you look over
S1: all of your investable assets, that that doesn't comprise too
S1: high a percentage, which makes you too highly concentrated. Hope
S1: that helps. Thanks for your call. We'll be right back.
S7: Great to have you with us today on Faith in
S7: Finance live.
S1: I'm Rob West. We're taking your calls and questions 800
S1: 525 7000 is the number to call again. That's 800
S1: 525 7000. Right back to the phones. Elk Grove Village, Illinois. Hi, Brian.
S1: Go ahead. Sir.
S8: Hi. First of all, I love your show. I listen
S8: to it all the time. Thanks for what you do.
S8: So The, uh. So I'm 57, and so the, uh,
S8: for the, uh, are right with the required minimum deductions,
S8: I guess. Um, so I'm thinking once I get to retirement,
S8: I want to live off, like, 4%, which is what
S8: you always say of your, you know, IRA 401, your savings,
S8: whatever your. And then, uh, when, when does, when does the, uh,
S8: required minimum deductions kick in? Um, because I just I
S8: didn't want to I mean, like, is it going to
S8: be more than 4% or. I just don't know how
S8: to plan for that?
S1: Yeah. Yeah, it's a good question. Um, so there's a
S1: table that the IRS publishes and it's based on your
S1: life expectancy. So, uh, the RMD percentage at age 73,
S1: I'm looking at it. So the life expectancy factors here,
S1: you would take, um, your account balance, uh, times the
S1: life expectancy factor. So at 73 that's 26.5. And so
S1: the equivalent percentage would be about 3.75% of your balance.
S1: Um and so when you get to that point because
S1: based on the current law and it could change between
S1: now and then, but the required minimum doesn't kick in
S1: until age 73. Uh, if you turn 73 and in
S1: 2025 or later. Um, so it sounds like, you know,
S1: you would be pulling out just based on at least
S1: the way the tables are today. With the life expectancy factors,
S1: you'd be pulling out a little bit more than you
S1: would be required to anyway with a 4% withdrawal rate.
S1: If for some reason you wanted to take less and
S1: you weren't getting above it, then you know you could
S1: do some of your giving out of it, uh, through
S1: what's called a qualified charitable distribution and perhaps replace additional
S1: give or the same giving you were doing with after
S1: tax dollars from checking or savings. You could instead take
S1: it from your IRA. Um, you know, to get up
S1: to the minimum. But just based on your current plans
S1: and the way the the tables are structured, you're going
S1: to get above it anyway.
S8: Sounds great. Okay. Uh, that gives me some relief factor. Okay.
S8: Thank you.
S1: Awesome. Yeah. You're welcome. Call anytime. Hey, Brian. Uh, appreciate
S1: you being such a regular listener. Stay on the line.
S1: We'll send you a gift. I'd love to give you
S1: a copy of our magazine. Faithful steward. I think you'll
S1: enjoy it. We appreciate your call today. Uh, let's go
S1: to Bradenton, Florida. Hi, Margie. How can I help?
S9: Hi. Hi, Rob. Um, yeah. Um, I'm currently giving to
S9: charities every month, uh, on a monthly basis, and I'm
S9: cashing out mutual funds to do that. Um, but I'm wondering, uh,
S9: if there's a better way to do it that I
S9: can give the mutual funds directly to the a variety
S9: of different charities without cashing it out first. And I
S9: know a lot of churches and different charities can't take
S9: stocks and mutual funds. And I didn't know if you
S9: could direct me of a way to how to do that,
S9: to give them, you know, so I don't have to
S9: take that tax burden.
S1: Yes, ma'am. No, I totally get it. And this is, um,
S1: in a taxable account, not a retirement account. Is that right?
S9: Uh, one is an individual, and it's mutual funds. And
S9: the other one is Roth mutual funds. So it's a
S9: non one nine and one's a Roth.
S1: Okay. Uh yeah. So one is just a straight taxable account.
S1: And you didn't get a tax deduction or anything when
S1: you put it in. Right.
S9: Right.
S1: Okay. Yeah. So you're right is you do need to contact, uh,
S1: the charity first. Not all mutual funds, uh, are accepted
S1: directly by the charity. If they do, you would ask
S1: for their mutual fund information. Sometimes it's different than their
S1: brokerage for stock gifts, and then you just initiate the
S1: transfer with the mutual fund company, and that may take
S1: longer than donating stock. So you've got to just be
S1: aware of that. And then you would receive the charitable
S1: deduction for the the fund's fair market value, which avoids
S1: that capital gain. Now, if the charity cannot take the
S1: mutual fund, then you'd probably want to consider donating it
S1: to a what's called a donor advised fund and then
S1: grant the money out in the form of cash after
S1: it hits the donor advised fund. Are you familiar with
S1: that term?
S9: Um, yeah, I'm seeing online a Da giving 360. Is that.
S7: Yeah. So that that would.
S1: Be a donor advised fund sponsor. I would use a
S1: donor advised fund. I mean, if it's going to just
S1: go in and go right back out, then you could
S1: look for a low cost provider like Fidelity or Schwab. Um,
S1: you know, if the, if any part of the money
S1: is going to stay there, I would rather you be
S1: with the National Christian Foundation NCF giving com. They call
S1: it a giving fund. It's just because ultimately the donor
S1: advised fund sponsor has control over whether or not they're
S1: going to honor your grant request. Now, the way they're
S1: supposed to work is you make the grant request and
S1: they grant it out to the 500 1C3 charity or
S1: your church upon your wishes. But they can establish protocols
S1: around certain organizations that they won't give to. But so
S1: that's why I like being with a faith aligned organization
S1: to ensure they're never going to close you off from
S1: giving to the the ministries or charities that you want
S1: to that might have a religious intent. I'm not saying
S1: Fidelity or Schwab do that, but they have the ability
S1: to do that if they wanted to in the future.
S1: But yeah, you would create a donor advised fund with
S1: Fidelity or Schwab or the one you talked about or
S1: NCF giving com that I mentioned, National Christian Foundation, and
S1: then you would make the mutual fund gift. Um, typically,
S1: donor advised funds can accept mutual funds as soon as
S1: it hits the account. Then that would be gift. So
S1: you'd get the the charitable contribution for the full amount,
S1: and then you would be able to grant the money out,
S1: usually through an online portal, kind of like online banking
S1: at whatever point you want in the future. But at
S1: that point you're no longer getting a contribution receipt from
S1: the ministry. You're getting it when you make it to
S1: the donor advised fund, and then the donor advised fund.
S1: Sponsor will just send cash to the ministry whenever you
S1: tell them to. Does that make sense?
S9: Yeah, that sounds great. Now is there um, how does
S9: that NCAA that ncc's keeping any of my funds as
S9: a processing fee or anything like that?
S1: Yes, they do. And so you're going to want they
S1: all have a fee that they would charge, probably a,
S1: you know, an ongoing fee that would be pretty modest.
S1: And so you're going to want to understand what that is.
S1: I don't remember what NFS is right offhand, but if
S1: the money's going in and right back out, it's going
S1: to be very modest. Um, but if you were really,
S1: you know, curious about the fees, then you could compare
S1: NCF against, you know, Fidelity or Schwab or the one
S1: that you're looking at. But as long as you verify
S1: in advance that they will allow you to grant out
S1: to whatever ministry or your church you want to and
S1: they will. And cost is a factor. Then you could
S1: make it on that basis.
S9: Okay. And and you're saying like Nancy cat. Sam.
S1: Uh, no f as in Frank. So National Christian Foundation. Um, yeah. They've, uh,
S1: you know, give out, uh, they grant out billions of
S1: dollars every year, but it's not their giving. It's just
S1: they're the vehicle for the giving among tens of thousands
S1: of Christians that use NCF as their giving platform. It
S1: was founded by Ron Blue and Larry Burkett. Wonderful organization.
S1: They're great partners of ours. You'll find them at, uh,
S1: in CCF, National Christian Foundation, NCF. Com. It's called a
S1: giving fund, but that's the same as a donor advised fund.
S1: All right.
S9: Oh, wonderful. Thank you so much. I'll give them a
S9: call and get this all worked out. I really appreciate
S9: your guidance. Thank you.
S1: Absolutely, Margie. You're welcome. Thanks for calling today and for
S1: being a part of the program. We appreciate it. All right, folks,
S1: we're going to head to a break. Bob Dole is
S1: going to stop by right after the break and catch
S1: us up on the markets. By the way, if you
S1: love the program, want to support our work and receive
S1: quarterly issues of Faithful Steward, our magazine and pre-release copies
S1: of our studies and devotionals and get Faith five Pro,
S1: our app. Go to faithful.com and click give. We'll be
S1: right back.
S10: Great to have you with us today on Faith in finance.
S1: Live here in this final segment today Bob Dole is here.
S1: Bob stops by each Monday in this segment to give
S1: us his take on the markets and the economy. And Bob,
S1: a welcome reprieve from the sell off last week, huh?
S11: A lot of green on the screen. And of course,
S11: the reason, as you know, is, uh, primarily, um, President
S11: Trump's walk back of his, uh, punishing words of a
S11: little more than a week ago related to tariffs, uh,
S11: discussions not going well with the EU. Uh, add to
S11: that a good consumer confidence number today and stocks took
S11: to the upside.
S1: Yeah, they sure did. Uh, Bob, you know, where do
S1: we find ourselves just in terms of the likelihood of
S1: a recession over the balance of the year? I know
S1: there's a lot of uncertainty, but, uh, you know, you
S1: market guys like to, uh, look at the hard numbers
S1: and make guesses. So we'll let you guess. What do
S1: you think?
S11: Yeah. I'm glad you suggest we do that all day long. Uh,
S11: my guess, having come into the year with a guess
S11: of 25% chance, got as high as 50 when the
S11: worst of the tariff news was there. Now we're kind
S11: of one out of three. Call it 30% chance. So
S11: higher than normal, but still comfortably under 50%. What I
S11: would clarify, uh, with that, Rob is a slow down.
S11: I'm convinced we're going to have a slow down, although
S11: with consumer confidence numbers like today. Maybe that's wrong too.
S11: But I think we'll get some slowdown as we'll see
S11: some unemployment pick up some jobs lost, but not a disaster.
S1: Yeah. Bob, what would be some of those leading indicators
S1: that you would be looking at that really give us
S1: the full story on the slowdown if it's happening.
S11: Yeah. The best that's reasonably frequent meaning every week is
S11: initial unemployment claims. Uh, and they have held pretty steady. And, uh,
S11: that tells us that all the soft data about the.
S11: Surveys that have fallen off a cliff, that has not
S11: yet bled into the hard data, the actual news of
S11: our economy, so we're still in that limbo land. Will
S11: the soft data move into the hard data?
S1: Yeah. No question about it. Bob, what about inflation? What
S1: what are the latest readings showing? And do you feel
S1: like that's continuing to come down?
S11: Well inflation numbers are going to say sticky at high
S11: two 3%. Nowhere close to the 2% target the fed had.
S11: Having said that, the University of Michigan Consumer Inflation Survey
S11: has individuals guessing the inflation rate is going to be 7.3%
S11: in the next 12 months. They must be doing something
S11: special in Michigan, I don't know. Even long term expectations
S11: are part of those. Consumer respondents was 4.6%. I don't
S11: think inflation is going to be that high. But as
S11: you know, we've been saying for quite some time, we're
S11: not going to get to two absent a recession.
S1: Yeah. And I guess that's why the fed has really
S1: taken their foot off the gas with any prospect of
S1: additional rate decreases anytime soon.
S11: Yeah, I think the fed will just kind of go
S11: down the middle saying things aren't weak enough for us
S11: to cut, but inflation is not high enough for us
S11: to increase. So we're going to watch the data and
S11: sit on our hands for a while.
S1: Bob, you had some comments in this week's deliberations just
S1: about the debt. And I know this is something that
S1: is looming. It has a lot of people concerned. You know,
S1: we went into the year excited about perhaps what Doge
S1: was going to do. And I mean, they've made some
S1: great progress, but where do we find ourselves today? And
S1: how do you think about that just in terms of
S1: where we're headed?
S11: You know, this is a great subject for a long
S11: term conversation, because I think it is one of our
S11: biggest long term problems. But as we observe history, federal
S11: debt service interest expense is now a bigger burden on
S11: our federal income statement than defense We spend more servicing
S11: our debt than on defense. Historically, that's marked a tipping
S11: point for great global powers, and they begin to deteriorate.
S11: Either we got to fix our debt problem, or we
S11: might go the way of these other major powers that
S11: have begun to lose importance in the world. Slowly but surely,
S11: we've got to tackle it. But the political system whereby
S11: folks do all they can to get elected, and immediately
S11: they start thinking about reelected, that's not an environment where
S11: you're likely to take the goodies away from people to
S11: fix the debt.
S1: Yeah, I guess the good news is, at least it
S1: is front and center on most Americans minds. And that
S1: wasn't always the case. So hopefully we're going to see
S1: people that are voting in favor of those that are
S1: going to take it seriously.
S11: Let's hope that's right. It's going to take a lot
S11: for Americans as a majority, to say, I'm going to
S11: vote for this guy or gal, even though they're going
S11: to take benefits away from me because they need to
S11: to cut the spending. That's what it's going to have
S11: to get to. Otherwise the debt will just continue to
S11: burn us.
S1: Bob, we're so thankful for your time. Thanks for being here.
S11: God bless. Bye bye.
S1: All right. That's Bob Dole. He's CEO and chief investment
S1: officer at Crossmark Global Investments. Learn more at Crossmark global. Com. Uh,
S1: let's finish out the broadcast today. We'll try to get
S1: to two more calls. Chicago is where Vanessa is located.
S1: Go right ahead.
S12: Hello. Um, hi. Can you hear me?
S1: Yes, ma'am.
S12: Um, yes. I'm calling because I'm trying to get an
S12: understanding of how my Social Security benefits will be taxed.
S12: I'm still working. I'm making about $30,000 a year, and
S12: I'm thinking about applying for my benefits, um, later this year.
S12: And I'm 68.5 years old.
S1: Okay. Got it. Yeah. So a couple of things there.
S1: I mean, number one, you can earn as much as
S1: you want, uh, being that you're over full retirement age.
S1: So that's a good thing in terms of how the
S1: taxes work. The basics are this. Your benefits may be taxable,
S1: and it's going to be dependent upon what the IRS
S1: calls combined income. So what is combined income? Well it's
S1: your adjusted gross income plus the non-taxable interest. So that
S1: would only apply if you have municipal bonds let's say
S1: plus half of your Social Security benefit for the year.
S1: So AGI plus half of your Social Security benefit, if
S1: that equals an amount more than the limit, then that's
S1: when you start to be taxed. Now do you file
S1: file single or married. Filing jointly.
S12: Single.
S1: Okay. So your limit where your your combined or your
S1: Social Security benefits begin to be taxed is $25,000. If
S1: your combined income, half your Social Security plus your AGI
S1: is over 25,000, you're going to start to pay tax
S1: on your Social Security up to 34,000, and you would
S1: pay taxes on 50% of your benefits if you go
S1: above 34,000 with your combined income. Now your Social Security
S1: is 85% taxable. Now what is AGI? Well, that's just
S1: all of your wages, your salaries, your tips, your dividends,
S1: your interest, your capital gains minus, you know, any deductions. So, uh,
S1: you know, traditional IRA contributions, things like that. When you
S1: add that AGI to half of your Social Security, that's
S1: the number you're looking for. And if it's above 25,
S1: up to 34, you're going to have up to 50%
S1: of your Social Security taxed over 34, up to 85%.
S12: And with that AGI include the standard deduction that you
S12: get for taxes.
S1: Yes. Mhm.
S12: So it's after that.
S1: Uh no I'm sorry. AGI is before the standard or
S1: itemized deductions. So the only deduction only adjustments that come
S1: out of AGI are. IRA contributions. HSA contributions. Student loan interest.
S1: Self-Employment taxes. Uh, alimony, things like that. Not the standard
S1: or itemized deductions.
S12: Okay. Thank you very much.
S1: Okay. You're welcome. Thanks for your call today. We're going
S1: to finish in Deerfield Beach. Mackenzie, how can I serve you?
S13: Hey, um, I was this is a follow up question
S13: from a previous caller. I was going to ask, what
S13: are some good ETFs I should invest into, and what
S13: are some resources you recommend that helps me narrow down
S13: my decision making?
S10: Yeah, it's a good question.
S1: You know.
S10: If you're just.
S1: Starting out. That's why they created what are called indexes. Uh,
S1: so an index is how you can buy a broad
S1: swath of, of the market. And you can do that
S1: based on different market indexes. So if you buy an
S1: S&P 500 index then you'd own the 500 largest growth
S1: companies in the United States. You could buy the total market,
S1: which is a much bigger exposure to US stocks. You
S1: could buy an international ETF or a bond ETF. So
S1: you've got to decide what do I want to own?
S1: And then do I want to just own the broad
S1: market or do I want to pick individual sectors. So
S1: you can make those decisions yourself. And there are faith
S1: based investing ETFs where you can ensure that the companies
S1: are being screened for Christian values to make sure you're
S1: not supporting something that's, you know, antithetical to your values
S1: and that companies that are being bought are being bought
S1: not only because they provide compelling value, but also because
S1: they are promoting the common good flourishing. So, uh, you know,
S1: it really just comes down to how much due diligence
S1: and research you want to do. The other approach is
S1: to connect with our friends at Sound Mind Investing. They
S1: could probably help you out with that. Um, and I
S1: can send you a book that would help you as well. But,
S1: you know, I think it really starts with education, where
S1: you need to become familiar and then you need to
S1: make sure you're properly diversified. Another approach that takes some
S1: of the guesswork out, Mackenzie, is you could use what's
S1: called a robo advisor, which is basically an automated approach
S1: that uses ETFs, but it will build the portfolio for you,
S1: ensuring that you're properly diversified and ensuring that your risk,
S1: the amount of risk you're taking, is appropriate for your age.
S1: And if you wanted to use robo instead of picking
S1: ETFs directly, I would look at betterment or the Schwab
S1: Intelligent Portfolios.
S13: Got it. Okay, perfect. Thank you. I really appreciate you
S13: answering that because I have me I would like to
S13: invest wisely. And I just want to know most of
S13: the companies that they're doing something righteous with the money.
S13: So thank you.
S1: Yeah. Well let me tell you if you want an ETF? Um,
S1: you know, all the sponsors of this program, if you
S1: go to.com and click on the show and scroll down,
S1: you'll see Eventide, you'll see Praxis. You'll see, um, you know,
S1: one ascent. You'll see cross Mark. All of them have ETFs.
S1: And you'll know that any one of those fund families
S1: that also have ETFs is faith screened. So it's going
S1: to ensure that companies that are misaligned with your values
S1: are eliminated. So just go to faith. Com click on
S1: the show. And that would be a great starting point
S1: for you to check out companies that you should be
S1: looking at. McKenzie thanks for your call today. God bless
S1: you my friend. Well that's going to do it for
S1: us today, folks. Faith in Finance Live is a partnership
S1: between Moody Radio and Faith. I want to thank say
S1: thanks to my team today, Amy, Taylor. Dan and Anthony
S1: couldn't do it without them. Plus everybody here at Faith by.
S1: Enjoy the rest of your day. We'll see you next time.
S1: God bless you. Bye bye.