Tools Needed In Your Financial Toolbox

[INTRODUCTION] Welcome to Christian Financial Perspectives, where you’re invited to gain insight, wisdom, and knowledge about how Christians integrate their faith, life, and finances with the biblical Worldview. Here’s your Christian Financial advisor’s host, Bob Barber and his co-host, Shawn Peters. [EPISODE] Shawn: Welcome to another episode of Christian Financial Perspectives. We’re so glad that you joined us today. Whether you’re watching right now or you’re listening to this, thanks for being here. We noticed that about 80% of those watching on YouTube are not subscribed. So, if you do like this video or one of our other videos, I’d love for you to smash that subscribe button and like this video. Today we are going to be covering tools you need in your financial toolbox. If you like things like this as well as other topics related to finance from a Christian perspective, then again, please hit that subscribe button. Bob, what do we got for today? Bob: Well, Shawn, the reason I came up with the title, “Tools in Your Financial Toolbox,” was just about a week ago we had this big storm here in Texas and we had an ice storm. It got on one of them and caused those branches to come down, and I had a branch fall off. It hit my water control valve for my sprinkler system and water was shooting up everywhere. I live out in the country. Well thank goodness I had the tools I needed to fix the problem because I couldn’t have gotten a plumber out there. It was 31 degrees outside. It was a mess, but I was able to get that leak stopped and was able to cap the leak. I thought about, I needed those tools right then, and had I not had those tools, I would have been in trouble. Anyway, see we got tools here. We got, we got a tape measure, got a hammer, screwdriver, got a level. As a matter of fact, we were using a level back here and to level things around here, so we had the tools needed. I think about this, do you have the tools that you need for your toolbox? We’re going to think, talk about the tools in the… Shawn: The financial toolbox. Bob: Got to make sure we put that in there for your financial toolbox. Shawn, I know you were thinking like, okay, Bob, what scriptures would go with this? It was interesting that one that you came up with, so share that scripture since this is Christian Financial Perspectives. Shawn: The one that I came up with was Ephesians 6:13-17. This is from the NASB. “Therefore, take up the full armor of God, so that you will be able to resist on the evil day, and having done everything, to stand firm. Stand firm therefore, having belted your waist with truth, and having put on the breast pr breastplate of righteousness, and having strapped on your feet the preparation of the gospel of peace; in addition to all, taking up the shield of faith with which you will be able to extinguish all the flaming arrows of the evil one. And take the helmet of salvation and the sword of the Spirit, which is the word of God.” Now, some of you may be asking, why am I talking about the armor of God when we’re talking about financial toolbox? Well, what came to my mind was that what is true in the physical was first true in the spiritual. The scripture tells us, that we need to equip ourselves. And there’s a lot of different pieces to the armor of God. It’s not just a shield. It’s not just a helmet. There’s a lot of different pieces to it. Each have their own purpose and function. If that’s true in our spiritual battle, why wouldn’t it also be true in the physical life here? In this case, finance. Just like the spiritual battle in finance, there are certain tools that you need in order to be properly equipped to fight the financial battle, if you will. Bob: That shows the word of God is living and active. It can apply in so many different areas of our lives. I had one from Proverbs. You know I’m a big Proverbs guy. In Proverbs 24: 3-4, and I got this from the message. Which I know you like the message Bible. “It takes wisdom to build a house, and understanding, to set it on a firm foundation; It takes knowledge to furnish its rooms with fine furniture and beautiful draperies.” I look at that wisdom and prudence and knowledge is so important to have the right tools. In this case we’re talking about financial tools. Shawn, I came up with what I feel are eight essential tools that you need to have in your financial toolbox. Shawn: Well let’s go with the first one then. The first one we have is estate plan. So, Bob, do you have an estate plan? Bob: I do. I have a very good estate plan as a matter of fact, and how it’s going to be handed to the next generation with wisdom. Shawn, I’ve updated that estate plan three times in just the last 10 years. It’s very important that your estate plan be updated. We’ve done podcasts on estate plans. If you’ll look through our archives, you’ll find some of the ones that we’ve done. Especially someone with young children like you and Jenna have, who’s going to take care of the children? How are things going to be passed down to the next generation? For Rachel and I who’ve been accumulating wealth for 38 years now, and it has accumulated in quite an amount. I want to be very wise and prudent how I hand that down to the next generation. Shawn: Also making sure that you don’t pay to Caesar anymore than you have to pay to Caesar. Bob: That is the truth. That’s the truth. At a certain point, he starts taking 30 and 40%, the government does on that estate plan. I think that is a, that’s one of the most important things of the tools. Like a hammer, we know is a very important tool in building a house. That is such an important tool, and Shawn, you know and I know about 80% probably of our listeners do not have an estate plan. Which is absolutely insane. It’s crazy. Shawn: Well, we’re going to have some links in the description to give you some resources specifically on that. Nowadays there’s really no reason to not have an estate plan. At the very least, having a basic will and some information, but better yet, actually having some sort of estate plan. Bob: We’ll put that link up for the podcast, the actual podcast. We’ve had several of them on estate planning. Shawn: We’ll link to some of the podcasts as well as some of the resources for you. Now the next one would be because as we said, there’s eight tools. If all you have is a hammer, everything starts to look like a nail. Our next one is in addition to the estate plan, you have a retirement plan. The estate plan, Bob, I guess you would say is planning for when you’re gone. When you go to be with the Lord. But for the retirement plan is, well either you’re in retirement or hope or you’re getting to retirement. What are you going to do while you’re no longer working, but still here? Bob: In preparation, just like with that water leak I had preparation. A retirement plan is not something that you build in just a matter of days or weeks, or even years. It’s many, many years that it takes to build a retirement plan, and putting money into that 401k, that 403b, that thrift savings plan, etc. We’ve spent again, entire episodes on a retirement plan. We’ll find a few of the podcasts we can put up again on the screen. Shawn, this is why it’s so important as we talk about this too, that those that hear us on the podcast, they need to go see us on YouTube too. They’ll get a lot more by seeing those resources. Shawn: We’ll have that in the description as well. So the next one, financial plan. So we’ve got financial plan with expected and unexpected expenses built into the plan in the future. For example, automobile, home, primary home repair, college expenses, medical expenses. Why don’t you talk me a little bit about Bob. Bob: The financial plans that we do here are really living, active, and breathing just like scripture is. We can put those things into the plan. Like, I want to do a home repair in two years. How’s that going to work within your financial plan? We have college expenses maybe coming up for grandchildren or children in 8 or 10 years or 15 years. They want to go maybe here in Texas. Maybe they want to go to Texas A&M. Well we can actually put that in our system Shawn: And see if you’re on track for those things. Bob: That’s right. Medical expenses are the same way. Maybe there’s some upcoming medical expenses, and it’s good to be prepared for unexpected medical expenses. Shawn: I think a good one for that would be is if you do have, say a higher deductible medical plan. Well, making sure all right, during the year, if we have to actually hit that full deductible before things kick in, how’s that going to affect your savings? How’s that going to affect your actual planning. Are you going to be okay? If not, well then you definitely need to be working on having enough saved up for that. Bob: And how you build those cash reserves. Cash reserves are so important for these kinds of unexpected expenses, but maybe even like we have here a primary home repair. Maybe a remodel that’s coming up. How does that fit into your plan? You can’t just go into that in the dark and say, well, we’re just going to take it out of here because everything you do take out of here is going to affect the future. Shawn: That’s right. Bob: Our financial plan will show that. Shawn: Bob, I’ll let you take number four. Bob: Risk management insurance plan. This really has to do with your life insurance, health insurance, disability, home, auto, and liability insurance. I’ve seen more times than not inadequate coverage when it comes to these areas. Shawn: Especially when it comes to disability. Even if people do have proper insurance and say, life and health and home. Even of course auto. People are usually deficient when it comes to disability, which is bad because the statistical chances of you needing disability insurance versus life. Well, life is going to be one time. The chances of you being unable to work for a period of time is a lot higher than you actually passing away, especially the younger you are. Bob: What I see in life insurance too many cases? I’ll see a breadwinner that maybe makes a $100,000 a year and all he has is $250,000 in life insurance. And the family is relying on that breadwinner’s income. Shawn: So you’re really looking at two and a half years tops of income. Bob: They need at least a million of coverage, and that can be proved with a financial plan. I see auto policies that don’t have enough coverage too. Like, uninsured medical, $5,000, you can push that up to 50 for pennies on the dollar. It doesn’t take a lot. All right, number five. Shawn: The balance sheet financial statement: so your assets, liabilities, and you should have something that updates automatically daily. Like for our clients, we use eMoney, which is a software that we have for all of our clients. In addition to the assets that we’re managing for clients, they can put in their bank account, their other 401k retirement accounts. Bob: They’re all linked there. Shawn: Basically pretty much anything that has an online login you can put in to where it updates every single day. One of the big benefits of that too, especially when it comes into the estate planning and retirement planning, is when you’re looking at making a decision, or something should happen to you. Your family knows exactly what is the value of everything because it’s all updated every day. As opposed to, well, I haven’t updated in three years, so who knows what the value is. So big benefit. Bob: By the way, next week we’re going to cover e-Money and we’re going to have a lot as it’s live, and you’re going to see all this living and breathing plan. Which is so neat today, which we used not to have years ago. Number six is having a budget. That’s got to be a part of your financial toolbox. Shawn: Again, you should have some sort of software that tracks daily, because otherwise, if it gets out of date, it’s not very useful. It should be a kind of a given right? The next one is a savings and investment strategy. Bob: Well, I’ve mentioned that already, but you have to have those strategies for, like we mentioned up earlier for the retirement plan, for your savings plan, for the, unexpected expenses. Let me see, what else? Like a second home maybe if you wanted to buy one, or even a car. Maybe you want to buy a car in three years. You need to be putting that aside. That’s what I mean by savings and investment strategy for now and the future. I said savings and investment, not just investment, not just savings. Then we come down to the eighth tool. We’ve got four tools right here, but you need eight tools in your toolbox, and the eighth tool is… Shawn: Fiduciary based financial advisor to guide you through all the financial mine fields and help you with all these financial tools. As we’ve said before on the program in Proverbs: “Plans fail for lack of counsel, but with many advisors, they succeed.” Bob: Shawn, when I was learning, as you know I had a dad that built homes and my brother built homes, and I learned starting at 14 years old and I started framing homes and trimming out homes. They taught me how to use these tools. The eighth part of this in your toolbox is having that fiduciary fee-based advisor to teach you how these tools work. The tool’s, just a tool. That tool’s just sitting there until you know how it works, right? I mean, I know how a level works, but some people might not know you’re supposed to have the bubble in the middle, you know? You can put it up against the wall this way or this way, or even a 45 degree angle. You can use that tool in different ways, and that’s where what a fiduciary fee-based advisor will help you do. Shawn: Using that analogy, if you don’t know how to do anything in plumbing or ac repair or carpentry, and you go out and just spend $2,000 or $3,000 on the works from Home Depot or Lowe’s, and you get this huge toolbox and you get all the tools and you have no idea how to use them, is that going to help you? Bob: You’d need to make a lot of mistakes. Shawn: You also need to learn how to use the tools. It’s not just about having the tools, but how do you use them correctly. Bob: We hope that these eight tools have helped you, and don’t forget to tune in next week as we discuss and show you a presentation on screen of how all these tools fit into an integrated, interactive financial plan using the technology today. That changes as you do daily, monthly, annually. It’s all those life changes. This is what I love about financial planning today. So different when I started. Where it was just, you gathered information, you built the financial plan, you printed it on a printer, put it in a binder, there you go. It wasn’t living and breathing like it is today. So next week will be a really great program. If you haven’t tuned in any, we want you to tune into that one too. Shawn: One way you can get a nice little reminder about when that video is published is to hit that subscribe button. If you’re currently watching and you’re not a subscriber, and based on the numbers, that’s basically 8 out of 10 people Then please do hit that subscribe button. It definitely helps us. Helps out other people as well who might be looking for this kind of content, and again, thank you so much for joining us. Bob: If you want us to help you with how to use your financial tools, Christian Financial Advisors® would love to help. Our phone number during business hours is (830) 609-6986, or you can text that number during business hours as well, 8am to 5pm Central Standard Tme, or you can find us on the web@christianfinancialadvisors.com. Shawn: Thanks again for joining us. God bless. [CONCLUSION] We invite you to listen to all of our past episodes covering many financial topics from a Christian Perspective. To make sure you don’t miss any of Bob’s upcoming episodes you can subscribe to Christian Financial Perspectives on iTunes, Google Play Music, Spotify, or Stitcher. To learn more about integrating your faith with your finances, visit ciswealth.com or call 830-609-6986. [DISCLOSURES] Investment advisory services offered through Christian Investment Advisors Inc dba Christian Financial Advisors®, a registered investment advisor registered with the SEC. Registration as an investment advisor does not imply a certain level of skill or training. Comments from today’s show are for informational purposes only and not to be considered investment advice or recommendations to buy or sell any company that may have been mentioned or discussed. The opinions expressed are solely those of the hosts, Bob Barber and Shawn Peters, and their guests. Bob and Shawn do not provide tax advice and encourage you to seek guidance from a tax professional. While Christian Financial Advisors® believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability.