If you’re like me, paying taxes is cringe-inducing. Our government wastes so much money on frivolous and ridiculous initiatives and programs and departments. It’s aggravating. 

What’s worse than that is that our elected officials also have decided to use our tax revenue to fund heinous initiatives like drag events for minors, gender transitions-surgeries for minors, and abortion. That’s heartbreaking.

Some advocate for not paying taxes because of the immoral nature of the government as a form of civil disobedience and dissent, but I think scripture shows us differently and has much to say on how we should use our money especially regarding taxes.

The answer is not to stop paying taxes, but to “render to Caesar” what goes to the government. We can use our civil liberties to call our congressmen and senators and use our votes to change policies, but we should pay what we owe. While doing this, we should take as much advantage of the complicated U.S. tax code as we can. 

While complex, the IRS still provides many incentives and benefits that the Christian should use.

Followers of Jesus should pay the taxes they owe. (Matthew 22:21, Romans 13:6-7)

Jesus very famously answered the Herodians when they tried to trip him up and get him killed “Show Me the tax money.” and asked “Whose image and inscription is this?” They had to answer that it was Caesar’s. “Render therefore to Caesar the things that are Caesar’s, and to God the things that are God’s”.

Paul addressed this as well in Romans 13 when he wrote about submission to the government in his day. This government was certainly using taxes for immorality. Rome was outright involved in worship of Caesar and was killing and persecuting Christians, yet Paul urges his readers to remember that rulers are subject to God and placed there in His providence. Paul says “Render therefore to all their due; taxes to whom taxes are due, customs to whom customs, fear to whom fear, honor to whom honor.”

So, we ought to pay our taxes.

Followers of Jesus should give generously. (2 Corinthians 9:7, 1 Peter 4:10, 1 Timothy 6:18, Proverbs 3:9, Acts 4:32-37) 

Generosity is a hallmark of the people of God. The early church in the book of Acts “were of one heart and one soul.” These early Christ followers were selling their possessions so they could care for one another so that the gospel message would go to the ends of the earth.

Paul speaks on the topic very often in his letters to the churches, thanking them for their generosity to him and exhorting them to give. He instructs the wealthy to “be rich in good works” and for everyone to “give as he has purposed in his heart”.

As stewards of gifts from God, we should be prone to generosity. Gratitude is the mark of being redeemed. Since we were saved with such grace and mercy shouldn’t it be our joy to extend grace to others?

Followers of Jesus should save and invest for the future and live and spend wisely. (Proverbs 13:22, Proverbs 6:6, 1 Timothy 5:8) 

A little sleep, a little slumber,

A little folding of the hands to rest;

³⁴ So shall your poverty come like a prowler,

And your need like an armed man.

 The New King James Version (Nashville: Thomas Nelson, 1982), Pr 24:33–34.

Scripture is full of wisdom about working, resting, and being a good steward of what you have. Paul excoriates laziness in his letter to Timothy when he says “if anyone does not provide for his own, and especially for those of his household, he has denied the faith and is worse than an unbeliever”. Jesus’ parable of the talents assumes work and growth (though the point is about the kingdom, not limited to money). 

It is good to work and it is good and necessary to provide for our families. Wisdom requires saving and storing up for the future.

Put It All Together

Combining these goals when considering paying taxes can lead to some great ideas for paying less in taxes.

• In my experience, most people just guess what they think is best during the year and when it’s time to file taxes they may strategize a little with their preparer and end up making some pre-tax retirement contributions. Those are good and usually the lowest hanging fruit.
  • Max out your retirement plan savings at work. 
  • Max out your individual retirement accounts too. 
  • If you’re self-employed you can use SEP IRAs or a Solo 401k to really juice these options. 
• Sign up for a High Deductible Health Plan with an HSA option and max out the HSA, but don’t use the HSA funds for current medical expenses.
  • You can deduct HSA contributions from your income
  • Invest the funds in your HSA. Taxes on the growth are deferred.
  • If you use the money later on qualified expenses it’s tax free! 
• Give generously and strategically.
  • Consider “bunching” property tax payments and large gifts into the same years and alternating years you take the standard deduction if you’ve been close to itemizing year after year. 
  • Contribute to a Donor Advised Fund if you want to give a lot but don’t exactly know where to donate the money to (or if you don’t want to give it all at once!). You can give to these funds in lump sums and get a big tax deduction in the year of the donation. Then you can distribute gradually to the charities you’ve identified. 
  • Start a Family Foundation (for the same reasons as DAF above, but with more control and expense)
  • Use Qualified Charitable Distributions instead of RMDs when the time comes
  • Donate appreciated securities that you own instead of cash to reduce capital gains
• Add flexibility to your tax planning strategy. The tax code is full of ways to minimize income for these:
  • Own/open a small business
  • Save and invest in a non-qualified brokerage account
  • Own investment real estate

At the end of the day, paying taxes means you made some money. So don’t call a blessing a curse. Pay your taxes honestly and fulfill your calling while working to steward the wealth you have been given well.

Explainer: Roth Vs. Traditional

Your retirement savings account gets special tax treatment.

Regular (non-qualified) investment accounts are taxed according to the tax rules that exist for dividends and interest as well as capital gains. Those accounts generate tax forms you’ll get at the end of the year like 1099-DIV, 1099-INT, and 1099-B.

Traditional Retirement Accounts

A retirement account like a traditional 401(k), 403(b), 457, IRA, or annuity enjoys special tax-deferred treatment. You don’t have to count contributions to these accounts as income for the year you contribute, which reduces your taxable income for that year.

The money also gets to grow tax-deferred. Which means you don’t pay any taxes on interest, dividends, or capital gains realized inside the account.

Once you take money out of a traditional you are taxed on those distributions as ordinary income. Any distribution from the account will increase your taxable income for the year.

Roth Retirement Accounts

Roth accounts are different. Instead of reducing your taxable income in the year you contribute to these accounts, you still have to count the income in the year you contribute. Roth contributions do not lower your taxable income for the year you contribute.

Roth accounts grow tax-deferred just like traditional accounts do. There are no taxes on interest, dividends, or realized capital gains in these accounts.

When you take distributions from a Roth account there is no reporting to the IRS. The money has already been taxed and won’t be taxed again (unless you’re taking an early withdrawal).

Why People (and Tax Preparers) Prefer Traditional

The tax break you can get in the current year for saving into a traditional retirement account is very appealing. It can reduce taxes in the current year, sometimes by a lot. Sometimes using a traditional account can drop your marginal tax rate.

It’s very tempting to kick the tax burden down the road each year.

Sometimes, especially when you’re earning a lot, the tax-deduction now seems like it will be more beneficial than it will be later (in retirement) when your income will most likely be lower.

This is true and it might be true for you too. But what about when retirement comes?

Retirement Tax Time-Bomb

Eventually, you’ll start taking money out of your retirement accounts. Either you’ll use the money to supplement your income in retirement, you’ll fund big purchases, or you’ll give charitably out of it. Maybe you’ll postpone taking any money out of the account until Uncle Sam forces you to take Required Minimum Distributions and you’ll give the leftovers to your heirs.

Eventually, that money is going to get taxed (unless you deplete the entire account through Qualified Charitable Distributions).

Big traditional accounts have big RMDs. Big distributions mean more taxable income and bigger taxes.

All of those years of avoiding taxes during your working years could be offset by paying excess taxes during your retirement years if you’re not careful. A big traditional retirement account is better than nothing at all, but I’ve seen distributions cause unnecessary tax increases, Medicare surcharges, social security reductions, etc.

Where A Roth Is Beneficial

Having a Roth can help mitigate the tax impacts of a large traditional account by being the place where you paid taxes on purpose on some money already so that you don’t have to have a plan when you want to take it out.

By strategically funding a Roth account and controlling marginal tax rates you can ensure that you’re paying as little in lifetime taxes as possible.

This adds the flexibility to be able to take large distributions from the Roth for things like vacations, home improvement projects, cars, and more without having to worry about the tax consequence in retirement years.

Leaving A Roth to your heirs is the best

If you want to leave a large blessing to your kids and grandkids when you pass away, a Roth is a great gift.

Since you’ve already paid the taxes on the money, they won’t have to worry about it.

I’ve helped many folks who inherit traditional retirement accounts from their parents and grandparents, and while it too is a blessing, the tax consequences are annoying.

Usually inheritors are working and any distribution from a traditional inherited retirement account is taxed to them as ordinary income on top of what they’re already earning. It’s not that way with a Roth.

How To Defuse the Bomb

With some good planning you can take advantage of that large traditional retirement account you’ve built. You are allowed to convert traditional accounts to Roth accounts, but it’s fraught with other tax landmines.

My favorite way to navigate this is to use the early retirement years combined with charitable giving strategies to lower taxable income to allow for the largest  Roth conversions possible.

This type of planning is what excites me most. We can simultaneously reduce taxes, increase giving, leave a legacy, and enjoy retirement all at the same time! It just takes some work and thorough planning.

A Unique Niche

It’s been 15 years since I swapped out music for personal finance as my primary professional pursuit. Now I’m running a firm that specializes in retirement planning and tax planning for Christians and generous families who want to leave a legacy for their children’s children.

I wish I would have known 15 years ago to start specializing in this right away. It could have saved me some time, but here we are! Malcolm Gladwell popularized the idea that it takes 10,000 hours of practice to become great at something. That may or may not be true, but it definitely feels close to right.

I’ve built my business around this niche of coordinating retirement planning, tax planning, and charitable giving. I’ve spent the past 2 years specifically building the infrastructure and acquiring the tools to serve in this capacity and it’s my hope that I’ll have an impact on the local church as well as the local community with the service I provide. I’m confident I will.

Maximizing Living and Giving

The first priority in retirement planning is making sure you can keep living without running out of money. This is a math question and we can handle this with basic retirement planning techniques and assumptions. A good rule of thumb has been saving 15% of your income for retirement. That might work. How much should you have saved and how long will it last are questions we can answer when considering:

• Social Security
• Medicare
• Private Health Care / Sharing / COBRA
• HSA Balances
• Pensions
• Taxable (non-qualified) savings
• Tax-Deferred balances
• Tax-Free balances
• Lifestyle Expenses (how much is enough?)
• Giving Goals
• Leaving an inheritance

Minimizing Taxes

While tax planning doesn’t drive any retirement or giving strategy, it does supplement it really well. Almost every retirement decision has a tax consequence that sends ripples through your entire plan. That’s why I think it’s ridiculous that some financial planners don’t talk about taxes.

Off the top of my head:

• Distributions from IRAs are ordinary income
• Taxable accounts have short and long-term capital gains and losses to manage as well as interest and dividend income
• Saving into a Roth doesn’t reduce taxes in the current year
• Gifts to your kids can trigger gift tax reporting
• Inheriting a traditional IRA from parents can cause increased income.
• Increased ordinary income can trigger IRMAA and cost an additional ~5k a year.
• And so much more!

It Sounds Complicated, But It’s Worth It

It can get really complicated really fast, but it’s still worth it to work through these issues. The tax savings could mean thousands and thousands of dollars more for you, your kids/grandkids, and your church and favorite charitable organizations.

An Example

Many folks come to me when they’re about to retire and haven’t thought much about taxes other than trying to pay as little as possible each year when they file. Their tax preparer has maybe told them to make an IRA contribution but that’s about the extent of the planning usually.

Now they’re about to retire and usually their income will be lower than it has been at any time over the past 20 years.

This is a perfect opportunity for some planning.

Let’s say there’s around a million dollars in their 401(k). All traditional (pre-tax).

They’ve also done a great job saving and have around 200k in their savings.

They have no debt and own their home.

They have regularly given to their church and charities for a total of about ~20k a year (not enough to itemize deductions every year, but sometimes).

They’ve got a few grown children and have several grandkids.

After some review, it seems like they’ll be fine with social security as their primary income source and can supplement with savings as they need to, which will let that Traditional IRA grow. They were planning to leave most of that to their kids and grandkids anyway.

If this is the case, leaving Roth IRA money to their kids would be far more beneficial than Traditional IRA money, since they have to pay ordinary income taxes on any inherited IRA they receive from the parents.

So lets fix that.

A Solution

By converting some of the Traditional IRA each year to a Roth and offsetting the increase in taxes with a charitable contribution to a Donor Advised Fund these folks can create a charitable giving vehicle while simultaneously making a tax-free inheritance for their kids all while reducing taxes and increasing charitable deductions on their own tax return.

This all relies on great communication with your CPA or tax preparer and detailed planning, but it can greatly increase the efficiency of your plan.

Support From Scripture

A good man leaves an inheritance to his children’s children,

But the wealth of the sinner is stored up for the righteous.

The New King James Version (Nashville: Thomas Nelson, 1982), Pr 13:22.

But if anyone does not provide for his own, and especially for those of his household, he has denied the faith and is worse than an unbeliever.

 The New King James Version (Nashville: Thomas Nelson, 1982), 1 Ti 5:8.

Render therefore to all their due: taxes to whom taxes are due, customs to whom customs, fear to whom fear, honor to whom honor.

 The New King James Version (Nashville: Thomas Nelson, 1982), Ro 13:7.

 Owe no one anything except to love one another, for he who loves another has fulfilled the law.

The New King James Version (Nashville: Thomas Nelson, 1982), Ro 13:8.

  So let each one give as he purposes in his heart, not grudgingly or of necessity; for God loves a cheerful giver. 

 The New King James Version (Nashville: Thomas Nelson, 1982), 2 Co 9:6–7.

but lay up for yourselves treasures in heaven, where neither moth nor rust destroys and where thieves do not break in and steal. 21 For where your treasure is, there your heart will be also.

 The New King James Version (Nashville: Thomas Nelson, 1982), Mt 6:20–21.

Soli Deo Gloria!

Recession is a scary word. It may not be as scary as “depression”, but it’s still scary. In fact, the main reason economic downturns are called recessions nowadays is because the word depression carries some unwelcome connotations and the main reason the word “depressions” were used was to replace words like Panic! and Crisis!. There is no formal definition for “depression” in economics, though the Business Cycle Dating Committee of the National Bureau of Economic Research (NBER) is the closest it comes to having the honor of being the official namer of recessions and recoveries. The NBER uses a whole lot of factors to identify what is a recession and doesn’t solely rely on GDP as a measurement. It also doesn’t necessarily follow the old rule of thumb that any two consecutive negative-growth GDP quarters count as a recession, so this is all a little too confusing.

I’ve written about how bear markets are normal and unfortunately the same is true for recessions and wide-spread economic contraction. Recessions bring stress, uncertainty, and fear while they also bring opportunity. There is a great need to combat the (very normal) emotional reaction to the volatility that happens during contracting markets, and that need is even more amplified if the goal of retirement is quickly approaching. With that in mind, here are some (hopefully) helpful thoughts and ideas to consider when retiring in a recession.

Look at History

As is often the case, a little understanding of history can put things into perspective and help to serve as a reminder that the wisdom of Solomon also applies to markets and economies. There is indeed nothing new under the sun as the Preacher explains in Ecclesiastes 1:9, so when worrying and planning for the future it’s helpful to remember that.

The original “great depression” happened all the way back in 1873, lasted 65 months, and was referred to as such until the next big one came in 1929. That original depression of the 19th century was arguably the harshest. It caused the stock exchange to close for 10 days. The Great Depression of 1929 lasted 43 months and was so bad that polite society decided to stop calling anything afterwards a depression, but many recessions still happened after that.

Using data back to 1857 the average length of a recession is around 17 months, but the post WWII era has a much shorter duration of recession; averaging around 11 months. The average time between recessions since WWII is about 5 years. The shortest recession in history is in recent memory: the Pandemic Recession, and it only lasted 2 or 3 months (with ripple effects still having an impact as of the date of this writing).

It’s still a matter of debate as to whether or not a recession struck again in 2022, though the NBER didn’t call one. Many are predicting one any second now.

Recessions and even depressions are a normal part of economic cycles and if we don’t recover from the next one it will be the first time in the history of the United States that has happened. Using history as our guide we can expect that the next recession will be unpleasant, but that it will also probably be survivable and may even be a blessing.

Stay Invested in the Market

When investing in the market(s) whether stocks, bonds, or real estate, there is one unifying principal: don’t jump in and out. One of the best times to invest cash has been at market and economic bottoms, but it’s extremely hard (maybe impossible) to time that out perfectly. There are merits to pushing available cash into the market in rough patches like Warren Buffet does, but there are much greater risks in trying to time when to move out of investments and into cash. Josh Brown of “The Reformed Broker” put it this way:

Who wins? The person who does the least.

The person who does the most always loses. Despondently bullish on Tuesday, hopeful on Wednesday, bearish again by Friday, buying on green, selling on red, mood changing with every day’s narrative, chopping yourself up at every twist and turn – this is how you can take a bad situation and make it ten times worse. I don’t recommend this sort of behavior. I’ve never seen it work.

https://thereformedbroker.com/2022/04/29/its-less-complicated-than-you-think/

If retirement is incoming, the last thing you want to do is try to get clever with your investment strategy right when volatility is ripsawing through your portfolio. Staying invested, diversified, and patient is the best way to maximize your results through recessionary periods. If you feel like you must do something then put some more of your cash to work in the market, or use it on the next idea…

Reduce Expenses

This is a bit of a no-brainer, but worth mentioning. Spending less means keeping more money and keeping more money is very heavily correlated with having more money. A great use of extra cash it to pay down high interest debt while in a recessionary period. Not only will that stop the incessant compounding of interest that increases liabilities, it frees up monthly cashflow that was previously being sent to creditors. Paying off an 18% interest rate credit card can be similar to an 18% market return when it comes to a personal balance sheet.

Aside from paying down consumer debt, cutting back on luxuries while in a recession is a normal (sometimes absolutely necessary) method to deal with the uncertainty. Humans have a very hard time imagining what life will be like in the future, but by realistically looking at how much can be cut from monthly spending we can increase feelings of security. This is where cutting out the daily cappuccinos can actually come into play. In a crunch beans and rice sustain us just as well as steak and scallops. Dialing back cost of living expenses is a really easy lever to pull in case of a financial emergency. Some of us have experience using that lever already (remember being newly married and broke??).

Lifestyle creep is a real thing, and if left unchecked can run rampant and out of control. If you want to be able to retire in a recession having a handle on expenses is vital. If you can be content with waiting to live the high life for about a year (on average) through a recession then you can likely continue with your retirement plans.

Consider Part-Time Work

There is absolutely no shame in “un-retiring”. Those skills that funded the savings you have right now, the knowledge and expertise that put kids through college and kept food on the table, the determination and work-ethic that bought a house and started a business are ALL still there.

It’s not the end of the world to have to supplement income with part-time or even full-time temporary work. In fact, this is a large portion of many people’s legitimate retirement plans. It’s a good idea to not just retire and wait to die playing golf anyway, since we exist to love God and our neighbor and it’s hard to do that while selfishly living the last 30 years of life. So why not consider working again if anxious about retirement?

You may not even need to keep working, but if you’re scared about retiring in a recession just remember that you have the option of working again available to you. Especially right now when so many companies are looking for workers with skills that you probably have in spades.

Delay Big Spending Events

Often bear markets and recessions cause pre-retirees to keep working because they have grand plans for a family Hawaii trip or European vacation that is supposed to mark a grand finale to their working careers. There’s nothing wrong with that! However, a simple way to continue on with the retirement plan is to wait to make big spends out of invested assets while in a downturn.

Ideally, there would be plenty of cash available in anticipation of the big spend, so plans aren’t derailed. In fact, a recession can be a blessing if you were planning to buy a home, build an addition, buy a car, or travel soon. A big impact of recessions are drops in prices of all of those things as consumers focus on not losing their house and feeding their families. If you have the cash, it’s a benefit (to you) that the economy is resetting, and another reason that planning is so important!

If you don’t have the cash and would have to tap into investments at a depressed value, then the best answer is to simply wait. Be patient. We know that every recession so far hasn’t been permanent (and if the next one is we’ll have bigger problems) so the best answer is to just wait for values to recover and get back on track with the plan.

Trust Christ & Calm Down

My pastor often tells me a story of a really, really rough time in his life. Death, job uncertainties, failures, and all of that stuff was going on and he was bearing his soul to his pastor at the time. After all of his exasperated venting and emotional unloading his pastor looked at him and said “You know what your problem is? You don’t trust Christ. You need to trust Christ”.

What an infuriating thing to hear in the midst of sorrow and pain and uncertainty! But it’s true.

Surely there are more compassionate ways to put it, and we always feel like our situation is more complicated or unjust and requires a more delicate and/or articulate answer. But it is that simple.

Put a real perspective on your worry and trust Christ.

25“Therefore I tell you, do not be anxious about your life, what you will eat or what you will drink, nor about your body, what you will put on. Is not life more than food, and the body more than clothing? 26Look at the birds of the air: they neither sow nor reap nor gather into barns, and yet your heavenly Father feeds them. Are you not of more value than they? 27And which of you by being anxious can add a single hour to his span of life?^g 28And why are you anxious about clothing? Consider the lilies of the field, how they grow: they neither toil nor spin, 29yet I tell you, even Solomon in all his glory was not arrayed like one of these. 30But if God so clothes the grass of the field, which today is alive and tomorrow is thrown into the oven, will he not much more clothe you, O you of little faith? 31Therefore do not be anxious, saying, ‘What shall we eat?’ or ‘What shall we drink?’ or ‘What shall we wear?’ 32For the Gentiles seek after all these things, and your heavenly Father knows that you need them all. 33But seek first the kingdom of God and his righteousness, and all these things will be added to you.

34“Therefore do not be anxious about tomorrow, for tomorrow will be anxious for itself. Sufficient for the day is its own trouble.

https://biblehub.com/esv/matthew/6.htm

First Answer The Main Question

When I’m helping people through retirement it’s helpful to do a lot of imagining about the future. Most of the time people come to me to help them with math problems. The number one concern folks have when I am meeting with them is “Will I run out of money?”

Usually I can help answer that question with asset allocation recommendations, distribution strategies, tax planning, social security planning, health care planning, and more. It really depends on how much money you’re planning to spend and give and how long you think you’ll have to do it. I have software and spreadsheets and calculators for this.

Once we can be pretty certain you won’t run out of money, what’s next?

Now What?

Now that you don’t have to work what are you going to spend your time on?

Hobbies are great and fulfilling. Definitely take time to rest. Play golf. Fly balloons. Build cars. Learn a language or play music. Enjoy life. If you were out of balance on the work-rest-work-rest rhythm of life before, retirement is a great time to get back into it.

Retirement years should be another phase of dreaming and working and resting. You can accomplish so much still. It doesn’t have to be anything radical, but make sure you’re building into your retirement plan some fantastic and amazing things.

Do It Now

You don’t have to wait until you’re retired to rest or to dream. Do it now. Life is about much more than paying bills. Get your finances under your control. Figure out what’s important now so that you can use your money on the things that line up with your values.

Soli Deo Gloria!

What you’re invested in is a very important factor in whether or not you’ll run out of money in your lifetime. Though there are more important things (tracking your standard of living, defining what “enough” means for you, saving money, choosing the right accounts, managing taxes, etc.) how you invest is right up there.

That’s probably why you’re working with me (or at least have considered working with me!). You want to make sure you’re invested right. This goes far beyond picking “good” investments. Tracking costs, managing risk with rebalancing, picking the right types of accounts, calculating the best withdrawal strategy, and most importantly making sure you cultivate the right behaviors have a far bigger impact on success than picking one stock, bond, or fund over another.

It’s a safe assumption to say that I think using a good financial advisor is a smart thing to do since that’s how I earn my living, but there are some data backing it up too. Vanguard, famous among DIY investors, has a research paper that outlines the value an advisor brings. You can read it here: Vanguard Advisor’s Alpha®.

Because I think most of an advisor’s value is NOT brought to the table in the form of investment selection, I probably don’t highlight it that often. That Vanguard report doesn’t even list asset allocation as a value-add in their report, and it says that working with a good advisor can add up to 3% or more in net returns!

Well I want to highlight it a little today, because getting help choosing investments is likely one of the main reasons you’re even looking in to using an advisor.

I recommend Dimensional Funds primarily because I like their research and their approach resonates with my beliefs about the markets. Dimensional targets a value premium in an effort to achieve higher expected returns.

“Valuation theory says that expected returns are driven by the prices investors pay and the cash flows they expect to receive. […] In particular, the valuation equation tells us that stocks with a lower relative price (“value” stocks), a smaller market capitalization, and higher profitability have higher expected returns than stocks with a higher relative price (“growth” stocks), larger market capitalization, and lower profitability.” (https://www.dimensional.com/us-en/insights/30-years-pursuing-the-value-premium-price-to-book-stands-the-test-of-time)

Dimensional senior researcher Mathieu Pellerin, PhD recently published a paper in May that showed that using core equity portfolios (versus market portfolios) may provide higher expected returns for retirement. Here’s the abstract of his paper”

“Broadly diversified equity portfolios that pursue the size, value, and profitability premiums can help investors enter retirement with more assets, better sustain their retirement spending, and pass on larger bequests. Our study finds that even moderate exposure to the premiums can significantly improve retirement outcomes. The results are applicable to the design of retirement asset allocations, target date funds, and managed accounts.” (Pellerin, April 21, 2021)

These strategies are in no way a guarantee of good or great returns, but they help increase confidence in the investment strategies that we’re employing to make sure you can use your money most effectively!

Giving Breaks the Power of Money

Generosity is linked to happiness (reviews of studies here, here, & here), and it should be obvious that is the case: We are created for community and to love our neighbor.

41 Now Jesus sat opposite the treasury and saw how the people put money into the treasury. And many who were rich put in much. 42 Then one poor widow came and threw in two mites, which make a quadrans. 43 So He called His disciples to Himself and said to them, “Assuredly, I say to you that this poor widow has put in more than all those who have given to the treasury; 44 for they all put in out of their abundance, but she out of her poverty put in all that she had, her whole livelihood.”

The New King James Version (Nashville: Thomas Nelson, 1982), Mk 12:41–44.

From a biblical worldview I have the philosophy that everything we have is given to us by our Creator and belongs to Him. We are stewards of His gracious gifts; therefore giving generously is a tangible way to reflect that idea and to remind ourselves of that truth.

When we give we don’t do so to receive. We aren’t to be like the rich folks that Jesus saw at the temple. We don’t seek acclaim or reward. We’re not doing it to be seen by people who will then think “Man, that guy sure is generous! I bet he’s a really good person.”

We give because it’s objectively good and right. The benefit we are granted through this process is the privilege of being a part of the proper order of the universe, where God alone is glorified.

Soli Deo Gloria!

Giving Wisely Means More Giving

Our motivation for giving is not receiving, but we do live in a society that recognizes and incentivizes giving through the tax code. 501(c)(3) organizations exist. Charitable contribution tax deductions exist.

Giving generously is rightly motivated by gratitude overflowing from thankful hearts for the forgiveness of sins and imputation of righteousness we receive by grace through faith in Jesus Christ.

Giving wisely is subordinate to this and something that can be done with diligence and effort. But is it worth the effort and work if it’s not the impetus for giving?

Resoundingly, I answer YES! Because it can mean more giving!

So do not be put off by the complexity of the tax code and the work involved to move money about in order to maximize your generosity. Be motivated by the same gratitude that causes you to give regularly to your church, the local homeless shelter, the women’s health resource, the food panty, or whatever charity is on your heart.

Generous people are happier and giving breaks the power of money because it reminds us of the much bigger picture, yes, even the entire meaning of life.

There are only 5 things you can do with money.

You can use it to:

LIVE

GIVE

GROW

OWE (taxes)

OWE (debt)

When first starting out, money can be a struggle. We’ve all been there. Maybe you’re there right now. Just trying to LIVE can be tough when expenses outpace income.

The starting point is learning to live on less than we earn. Do you remember figuring that out? You and your spouse; tracking spending, budgeting, and building a spending plan all to have it all fall apart and have to start over again. Month after month.

Sacrifice

Discontentment

Anxiety

Fear

Fighting to create margin so we can realize our dreams of being able to GIVE, GROW, and pay down the money we OWE; all so we can finally, eventually, miraculously LIVE.

Once we have started to expect the unexpected, our income has increased, and our expenses have stabilized it should be a relief.

Maybe you’re giving regularly, you’re saving some money for later and it’s growing, and you’ve paid off your consumer debts –

But what’s next?

I think it’s the hardest part of financial planning. It’s answering the question “How much is enough?”

Paul Tripp writes frequently about the human tendency to search for transcendence. He wrote about it in his book A Quest For More, Awe, Redeeming Money, and many others probably.

If we’re not careful, this search can lead to lifestyle creep: piling up different trinkets, hobbies, subscriptions, cars, properties, vacations, clothes, and more. It’s pretty common and many folks in my industry advocate for it. Mindless consumption and endless discontentment. It helps the economy, right?

I think we can do much better.

I want to challenge you to set a Lifestyle Finish Line. Ask yourself

“How much is enough?”

You might have enough right now. You might have a way to go. No judgements on where your finish line is, it’s up to you, but I encourage you to work on setting one. I’m happy to help you.

Imagine what you could do if you had enough. How much could you GIVE? How much could you GROW? Imagine the freedom. Imagine the impact to your family. Imagine the change in your community and the Kingdom.

We have the opportunity to live for something so much more and should use our vast wealth and opportunity to do just that.

Soli Deo Gloria!

I’ve been bothered by the headlines lately, but it’s probably just because I’ve been paying too much attention to them. We always seem to be on the brink of the next disaster or world-changing event. I’m especially tuned-in to financial news and research, and it’s much the same there. It’s hard to rest sometimes.

In a world filled with matters ranging from maddeningly silly to truly horrendous, finding true rest can often feel like an impossible pursuit. “Easier said than done.” I hear. However, as Christians, we have the remarkable privilege of finding our ultimate rest in Jesus Christ, even in the realm of our finances. In this fallen world, where money can easily become an idol and a source of anxiety, resting in Christ is a beautiful gift given to us through the Spirit.

Jesus Himself beckons us in Matthew 11:28-30, saying, “Come to me, all you who are weary and burdened, and I will give you rest. Take my yoke upon you and learn from me, for I am gentle and humble in heart, and you will find rest for your souls. For my yoke is easy and my burden is light.” By accepting this invitation, we discover that true rest and peace are found in Christ, our Redeemer and friend. Regardless of our personal financial struggles or worries and the tumultuous world around us, Jesus offers us something transcendent and lovely.

In a fallen world, money often becomes an idol, leading us to seek security and identity in our financial status. However, when we rest in Christ, we acknowledge that our worth and security come from being children of God, joint heirs with Christ, not from our bank accounts or possessions. Our focus transitions from the fleeting riches of this world to the enduring treasures found in Christ.

Christ frees us from the constant striving and worry that financial anxiety can bring. As the apostle Paul encourages us in Philippians 4:6-7, “Do not be anxious about anything, but in every situation, by prayer and petition, with thanksgiving, present your requests to God. And the peace of God, which transcends all understanding, will guard your hearts and your minds in Christ Jesus.” We find rest in the knowledge that our heavenly Father is aware of our needs and promises to provide for us according to His perfect will.

There are no guarantees of success in this life. There is no promise that you will be wealthy and that your investments will only ever return positive. There is just living in light of the truth and trusting. Christ empowers us to live counter-culturally in a world that constantly demands more. Hebrews 13:5 says, “Keep your lives free from the love of money and be content with what you have, because God has said, ‘Never will I leave you; never will I forsake you.'” In light of the gospel, how could we possibly live in a state of anything other than gratitude? We can live lives marked by joy and generosity, acknowledging that everything we possess ultimately belongs to God and is a gift from Him.

I hope that brings you peace when you worry about the future. It’s the only thing that comforts me.