On American Family Radio's MoneyWise program, SMI’s executive editor Mark Biller offered ideas that can help you increase your financial health and stability in the new year.
To listen, click the play button below. Scroll down for the transcript.
MoneyWise airs weekday mornings on American Family Radio. A different version airs weekday afternoons on Moody Radio.
(For more radio appearances by members of the SMI team, visit our Resources page.)
Transcript
Rob West:
This is MoneyWise from American Family Radio — biblical wisdom for your financial journey. (theme music ends)
Well, our friend Mark Biller is executive editor at Sound Mind Investing, where they've been busy coming up with their annual list of financial moves you can make in the new year. Mark, great to have you back on the program.
Mark Biller:
Thanks, Rob. Good to be back with you.
Rob West:
Mark, this is a great resource that you all post every year to help folks improve their financial picture. It's titled, of course, Your 10 Most Important Financial Moves for 2023. And folks can access it at soundmindinvesting.org.
But it's not just a list of 10 things, is it?
Mark Biller:
No, it's really a roundup of planning suggestions for the year ahead. And rather than providing a one-size-fits-all kind of list, instead we go ahead and serve up a broad range of ideas.
And the idea there really is for the reader then to go through that list and pick their own personal top 10. And that, you know, will come from the 70 or so suggestions that we discuss in that article, but it makes it very tailored to each individual.
And we've found over the years that people who are willing to do that and go through that exercise and then follow through on those specific items, really it helps them become a better steward of their resources and helps them move closer to their long-term goals.
Rob West:
All right. Well, you have these suggestions broken down into several categories, so let's go over them, and perhaps you can give us an idea of what to expect in each.
Mark, let's start with "Spiritual and Financial Fundamentals."
Mark Biller:
Yeah, sounds good. And as we dive in, I should also note that there are links to additional articles and resources for each one of these suggestions on the SMI website. So if listeners hear something that they want more information on or they want to dig deeper on a particular topic, that's the best way to do it.
Rob West:
Great.
Mark Biller:
So diving right in, Rob, here are a few of the spiritual and financial fundamentals on the list. First and foremost, we've got to acknowledge God as the Lord of your finances. And that's really the starting point of Christian stewardship and an important ongoing aspect of a deepening relationship with Christ.
Second in that section, we've got: Make a plan for your financial journey. You know, on these programs together we frequently discuss the need to develop a biblically sound, personalized money management strategy that will inform your spending, your saving, your investing, and your generosity.
And then a third one from that section, Rob, is to resist financial temptations. Handling money well takes more than just learning the rules of good financial management. You've also gotta practice and develop self-control. Now, thankfully, self-control is a fruit of the Holy Spirit. So as we draw closer to the Lord that fruit should become increasingly manifest in our lives.
Rob West:
All right, the next category of "financial moves" is "Strengthening Your Financial Foundation." What do you have for us there?
Mark Biller:
Yeah, so this section is all about making sure that that foundation is fully in place, and if it isn't, this really is the place for people to concentrate their efforts in the year ahead.
So a few suggestions here. First, take advantage of the world's most effective personal finance tool, and that is a budget! Now that may be unpopular, but a well-planned and well-executed budget really is the single best tool available for effective money management.
Now, one new one to the list this year is to comparison shop for higher interest rates on your savings. Over this last year, interest rates have moved from near zero a year ago to the 4-plus-percent range today. So moving your money to a savings account, maybe at an online bank, can meaningfully move the needle on the amount of interest a person can earn.
And then kind of in that same vein, we've talked a number of times over the last year about putting some of your savings in U.S. government I-Bonds. I-Bonds are paying inflation-adjusted rates that are well above most other bonds and other savings options. Now they do have some restrictions, but very attractive in the right circumstances.
Rob West:
Thanks for joining us on Moneywise. I'm Rob West. Joining me today, my friend Mark Biller, executive editor at Sound Mind Investing. You can learn [email protected].
What if you had a Top 10 list that was uniquely for you and your financial situation to make important moves for 2023 and really shore up your financial foundation and your role as a steward? Well, that's what Sound Mind Investing has made available. From 70 or more suggestions, you can handpick your Top 10 financial moves for 2023 in some key categories.
Just before the break, we talked about category one, "Spiritual and Financial Fundamentals." The second one we talked about was "Strengthening Your Financial Foundation." The third category is "Developing an Investing Plan." What do you have for us there?
Mark Biller:
Yeah, no surprise, we've got a lot in this section. We've got 26 different suggestions in this area. But the most important big idea here is Scripture encourages us to prepare for the needs of tomorrow without becoming hoarders. So all of these suggestions can help you invest as a faithful steward who acts with prudence and wisdom.
So the first idea in this section is to identify obstacles that are holding you back from saving for retirement and start moving those out of the way. So some common roadblocks would be auto loans, expensive housing, [and] generally poor money management.
But honestly, Rob, often the biggest obstacle is just not having a financial plan or any measurable goals. And that's really the whole point of this Top 10 list idea is to identify some of these key goals and then get to work.
So the second idea in this section would be to get familiar with the foundational biblical precepts related to investing. The Bible offers lots of timeless principles related to investing and managing our wealth. And by studying those and allowing those to become part of your thinking, you'll begin to be able to apply those ideas to the investing decisions that you face.
Last one from this group is an SMI hallmark, and that's to become a better investor by using an "inside-out" approach. Now, Rob, you and I did a whole program on this a couple of months ago, so listeners may want to dig that one outta the archives for more information. But the big idea here is to make investment decisions based on your personal inside-out needs rather than on the "outside-in" expert opinions and market news.
Rob West:
Yeah, that's really helpful. And then, Mark, as we build on this investing topic, I know you all have an entire section just on broadening your portfolio. What would you have our listeners know there?
Mark Biller:
Yeah, so this section is more for those who are becoming an experienced investor and they're looking to broaden their portfolio either to reduce risk or take advantage of market conditions. So a few examples from this section would be learning about investments beyond stocks and bonds.
You know, we just had the worst year for a traditional 60/40 stock bond portfolio in about the last five decades. Now, fortunately, there are some other options available, and learning about things like commodities, real estate, gold — just to name a few — that can really help add some additional diversification to a core portfolio.
Now on a similar note, learning about some easy ways to hedge market downside may be worthwhile for some folks. SMI has discussed several of those techniques and products this year.
And then a final one would be — you know, you might have to grapple with this whether or not you go through our list — but it's to understand some of the new investment options that are coming to a lot of employer-based retirement accounts. Now I have to warn you, not all of these are necessarily good options. So it's really important to be informed about some of this new stuff coming down the pike.
Rob West:
Yeah, that's exactly right. This is really helpful, Mark. Now, of course, no Top 10 list in terms of financial moves would be complete without thinking about retirement. And I know "Looking Toward Retirement" is our next category.
Mark Biller:
Yeah, and this section has ideas like taking advantage of the current bear market in stocks to convert traditional IRA money to a Roth IRA. You know, with investment account values down a lot this year for some people, it can be an attractive time to consider a traditional-to-Roth conversion so that you can have more tax-free income down the road in retirement.
Now, another example from this section would be assessing how much money you'll need to maintain your standard of living in retirement. We've got some helpful pointers on how to do that — how to look at that whole situation for those that have that life transition on the horizon.
Rob West:
Yeah. Great. Mark, you of course have a ton of suggestions in — let's call it your "miscellaneous" section. It covers children in college and insurance and a whole lot more. So I want folks to check that out when they read this article at soundmindinvesting.org. But I'd like to skip to what you call the most important section of all.
Mark Biller:
Yeah. That's "Your Relationship With God," Rob. There's, there's just no substitute here for this one. And first and foremost, the way that you improve that relationship with the Lord is to invest time in it.
You know, the most important goal of a Christian steward is to know Jesus. He's the one who is "the pearl of great price." And valuing your relationship and your communion with him above your wealth and investments is really a key cornerstone to keeping all this financial stuff in perspective.
And then, one last parting thought as we kinda wrap up what's been a tough financial year for a lot of people, I would just say that if we trust in Jesus and bring our concerns to him, Christ will deliver us through the difficulties of life. You know, we can live in hope because we serve a God who's too strong to lose control of any situation, he's too wise to make mistakes, and he's too loving to ever abandon us.
Rob West:
Hmm. Well, what a great reminder for us today. Mark, as we head into this new year, of course, learning and growing in our understanding of biblical stewardship is so key. And I've been so encouraged over the years through my own subscription to the SMI Newsletter. I'd love for you just to share with our listeners quickly what that is and what they would get if they signed up.
Mark Biller:
Yeah, well, the newsletter membership — we have an actual physical newsletter that goes out every month, and then we also have an online membership where we're writing content constantly throughout the month.
What we're trying to do is both educate folks — so we have a lot of folks who come in maybe not knowing a whole lot about investing, and then we've got folks all the way at the other end of the spectrum who know quite a bit about investing — but for all those folks, we're trying to educate [and] help people understand the investing world and landscape.
And then on top of that, we're putting together very practical, tangible counsel on what they need to do in their own portfolios so they can follow along with us with our model portfolios.
Rob West:
Excellent. And it's written by a team of writers, including Mark Biller, that really all want to bring you godly and biblical counsel so you can be a wise steward of your resources.
Well, Mark, thanks for stopping by today with some great ideas for improving our finances in 2023. Merry Christmas and a happy New Year to you.
Mark Biller:
Thank you, Rob. Always my pleasure.
