Rob West: Proverbs 22:7 says, "The borrower is the slave of the lender." Hi, I'm Rob West. Debt is difficult in any stage of life, but it can be especially burdensome in retirement when income is often fixed and financial flexibility is more limited. Today, Brandon Sieben joins us to talk about the rise of debt among older Americans and how biblical wisdom can help us move toward freedom. Then we'll take your calls at 800-525-7000. This is Faith and Finance on American Family Radio—biblical wisdom for your financial journey.
Well, it's a pleasure to welcome my friend Brandon Sieben back to the program. Brandon serves as Chairman of the Board at Compass Financial Ministry. Brandon, great to have you back with us.
Brandon Sieben: Thanks for having me, Rob. So encouraged to be here.
Rob West: Well, we always look forward to our time together, and I know, Brandon, you've been keeping an eye on this disturbing trend that's growing debt for folks even beyond retirement age. Give us a snapshot. How bad is it?
Brandon Sieben: Well, it's bad, Rob. According to the Federal Reserve Bank, over the past 20 years, debt levels for those in their 60s has risen by over 400%. And for those in their 70s, that grew by over 500%. So, big problem. And when we talk to folks nearing or in retirement, of all the issues they're dealing with relative to finance, debt's the biggest.
Rob West: Yeah. What kind of debt are we talking about here?
Brandon Sieben: It's a bit all over the board, but the top three we see are credit card debt—and oftentimes multiple credit cards—car loans, and home equity loans.
Rob West: Mm. And Brandon, what do you see as the cause for this increasing debt for these folks?
Brandon Sieben: Well, I'd say there's not one thing, but really a combination of factors. First, many times there's a spending problem, meaning retirees are spending like they were before retirement, but now without the income to cover the expense, so they borrow the difference. Second, a lot of folks just aren't aware of the cost of debt and how the math works. For example, you know, these days a credit card could be charging 20% interest, or a home equity loan could be as high as 10 to 12%, and people just really aren't aware of the costs there. Third, you know, a lot of people are conditioned to think that's okay, you know, no big deal. I mean, for example, I bet if you talked to nine or 10 retirees, 10 retirees, nine would tell you, "I've always had a car payment." Just kind of what we're always conditioned to do, have been. And fourth, maybe life happened. You know, maybe there's a medical emergency or they need help to get kids out of trouble, and the next thing you know, they're on the ropes. They were already living on the edge, no emergency fund, and now they have to borrow to get out of the jam they're in.
Rob West: Mm. Yeah, I certainly understand that. So, how do you counsel folks nearing retirement age or even beyond who have debt? Where do they need to go from here?
Brandon Sieben: Well, first, we tell them there are no shortcuts. You know, it's going to be hard, like going on a diet. Going to be some pain before the gain. Then we point them to God's Word first for encouragement. You know, God's pretty clear we should avoid debt. You can see that in Romans 13:8 or Proverbs 22:7. Even Jesus tells us in Matthew 6 we can't serve God and money—got to choose. And so when we're in a mountain of debt, the best first step is to get on our knees and ask God for help. And it's good. When you get debt-free, it glorifies God. Practically speaking, we find there's usually $500 to $700 a month of retiree spend that can be cut pretty quickly. Hard, but some areas include cutting back on travel, going out to eat less or not at all, canceling some or all of the home tech, like cable, or even cutting out some of those day-to-day creature comforts, like getting the manicures, pedicures, or the trips to Starbucks. And then lastly, financially speaking, we encourage people to understand the math and make the best financial decision.
Rob West: Yeah, that's so important, Brandon. And one of the real concerns here is that debt can quietly limit our availability to the Lord, especially in the later years of life. This is a season when many believers have a lifetime of wisdom, experience, perspective, and spiritual maturity to offer. They may have more flexibility to mentor younger people, serve in a church, support ministries, travel for mission work, or simply respond to needs around them. But when debt payments are pressing every month, these opportunities can feel out of reach. Instead of asking, "Lord, where are you leading me?", we can find ourselves asking, "How am I going to make the next payment?" So, the issue isn't just financial stress, it's also about freedom. Often, debt holds you back from following the leading of the Lord, doesn't it?
Brandon Sieben: It sure does.
Rob West: No doubt about it. Well, Brandon, that was great information. We really appreciate you stopping by today. I know this has been an encouragement to our listeners.
Brandon Sieben: Thanks so much. Have a great week.
Rob West: All right. That's Brandon Sieben, Chairman of the Board at Compass Financial Ministry. If you want to learn more about financial discipleship, how you can grow personally, or learn to teach others, check out their website at compassfinancialministry.org. That's compassfinancialministry.org. Back with much more just around the corner. Stick around.
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Rob West: Thanks for joining us today on Faith and Finance here on American Family Radio. Well, the lines are open. We're ready for your phone calls today. We want to help you think about the questions you have in your financial life as you progress on your stewardship journey. That's right, as you move from just getting acquainted to this idea that God owns everything, and moving throughout your financial life to a mature follower of Christ in this area of biblical financial stewardship. You know, it's something that we all need to wrestle with and think through, and think how our faith intersects with the decisions we make on a daily basis in our financial life. Well, that's precisely why we're here: to encourage you, to take you back to God's Word, but also to help you wrestle through those very practical questions you have today.
So whether it's related to your lifestyle, maybe your spending plan and balancing that budget, maybe it's getting out of debt, you've accumulated some debt—that's where we started today with Brandon Sieben. Perhaps that's true in your life, and you're wondering, "What's the best way to pay it off? Should I roll it all up into one new loan? Is there something better, perhaps debt management, debt consolidation, debt settlement?" I'll give you a quick response to that: No, it's not debt settlement or debt consolidation, but we can talk about it related to your specific situation.
Perhaps it's investing for the future. And by the way, speaking of investing, Bob Doll will stop by in our final segment today and give us a pulse on the markets as we begin the trading day. We'll get Bob's take on the latest economic data and also the on-again, off-again war in the Middle East and how that's affecting oil prices, which is showing up at the gas pump, and that's then leading back to that budget squeeze that you're facing. But there's investing questions, there's also Social Security and Medicare, and preparing the next steward. Any of those topics, we would love to tackle with you today. Lines are open, we're ready for you: 800-525-7000. That's 800-525-7000.
In the news today, married student loan borrowers face an important choice: whether to file taxes jointly or separately. And that decision can significantly affect monthly payments under the income-driven repayment plans, which are a feature of the federal loan program. Filing jointly combines both spouses' income, which can raise a borrower's required payment even if their own earnings have not changed. Filing separately, though, may reduce student loan payments, particularly when one spouse has debt and when a borrower is pursuing the Public Service Loan Forgiveness program. The new repayment assistance plan, which has been coined as RAP (R-A-P), may make this quote "marriage penalty" even larger. RAP bases payments on adjusted gross income and applies higher payment percentages as income rises, so combined spouses' earnings can push borrowers into a higher payment tier.
However, filing separately has drawbacks. It's never simple. Couples may lose access to certain tax credits and deductions, including the student loan interest deduction, and then may face a higher overall tax bill. So, bottom line: you need to compare both scenarios, calculate the tax consequences of filing separately versus jointly, then weigh those costs against potential student loan savings. Of course, a tax professional or a student loan specialist can help you determine which option produces the best overall financial outcome. Things are changing with the student loan program, and that means we need to lean back in and figure out the best option for you.
Bottom line: if you haven't borrowed yet, let's borrow as little as possible. Let's look for every option available—maybe a work-study program, maybe applying for more scholarships and grants. You know, my wife grew up in a single-parent home. Her mom made it clear, "Listen, I want you to go to college, but if you're going to do so, you're going to need to cover the cost." Well, they turned their living room into a college application scholarship application factory and just cranked those out. $150,000 in scholarships later, she was able to put herself through college completely debt-free. So, it can take some work. I had an on-campus job. I was a resident assistant my junior and senior year; that covered room and board. So, there are ways to focus on your education and offset some of those costs so that we can borrow less. You know, just because it's available doesn't mean that's the door we need to take, especially if you're pursuing a degree that's not ultimately going to lead to an income that's going to allow you to pay off the debt you're accumulating. I would say, rough rule of thumb: 10 years or less, you should be able to pay that off. If not, you're borrowing too much, and be realistic about what you can expect from that entry-level job in the career or major of your choice.
So, nevertheless, some people, you know, have to borrow, I get that. And so we just need to be careful, we need to not get overextended, and hopefully these insights can help you. All right, we're ready to dive into your questions today. Again, that phone number: 800-525-7000. That's 800-525-7000. You can call right now.
Rob West: Let's begin in Texas today. Hi, Debbie. Go ahead.
Debbie: Hello, good morning.
Rob West: Hi there.
Debbie: I have a question about the Trump account?
Rob West: Yes.
Debbie: Okay. So, when I first heard of them, they were talking about babies born this year and getting a start, and then I was surprised to hear that you can open it—and I heard several places you could open it for any child under the age of 18. But I think when I got the app and opened it up and looked, it seemed to indicate that if your child turns 18 this calendar year, they're not eligible. Would you happen to know?
Rob West: Mm, yeah. It's a great question. So, the eligibility rules are a little confusing. There's two different eligibility rules for the Trump accounts. Essentially, for an account opened in 2026, the child must not turn 18 by the end of 2026. So in practical terms, you know, the child would have been born after December 31st, 2008, and of course have a valid Social Security number. So, if it's opened this year, the child can't turn 18 by the end of this year in order to qualify.
Debbie: Okay, that's what I needed to know. Thank you very much.
Rob West: Okay, you're welcome. By the way, folks, just generally speaking, let me just say, you know, these are essentially a new type of savings account that can be very effective. Beginning July 4th of this year, so just last month, parents, grandparents, relatives, and others can contribute. Generally, private and employer contributions are subject to a combined $5,000 annual limit, with inflation adjustments beginning after 2027. And the government's $1,000 does not count against that $5,000 limit. Now, what is that? Well, that $1,000 is much narrower. It's only for children who are U.S. citizens born between January 1st, 2025, and December 31st, 2028. If they fit in that category, then they're going to get that extra $1,000 that the government—the Treasury—is actually going to put in on the child's behalf. If they don't qualify for that and they're older, less than 18, but older, then you can put in money for them, and that would allow you to go up to $5,000.
Now, an employer can contribute up to $2,500 annually toward an employee or a dependent's Trump account without that amount being taxable income to the employee, but it does count toward the $5,000 limit. And then during the growth period, the money generally must be invested in qualifying low-cost U.S. stock index mutual funds or ETFs, like tracking the S&P 500. Generally, withdrawals aren't permitted during the growth period, but after that period, it looks a lot like a traditional IRA in terms of the money coming out. So, can be a great option. Check it out at trumpaccounts.gov. More questions after this. Stick around.
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Rob West: I'm so thankful to have you with us today on Faith & Finance here on American Family Radio, helping you think through how to apply a biblical worldview to financial decision-making. We'll head back to the phones here in just a moment. We do have some lines open, by the way, if you have a question, call right now, 800-525-7000. That's 800-525-7000. You know, I mentioned that in the previous segment, that one of these key truths that we understand as we approach finances from a biblical worldview is, of course, that God is the owner of everything. It really is the starting point for biblical money management, because it puts everything, us and the money, in its proper and rightful place. And we look no further than, well, several places in Scripture to see this affirmed directly. Psalm 24:1 being the most notable: "The earth is the Lord's, and the fullness thereof; the world, and all who dwell therein." We realize that everything belongs to Him. Not only our financial resources, the dollars in the bank, but our income and our investments, our businesses, our abilities, our opportunities. Deuteronomy 8:18 though takes this a step further when it reminds us that God is the one who even gives us the ability to produce wealth. And so Scripture affirms we're to work hard, but we also understand that everything we have—our plans, our work, our relationships, our knowledge—it all comes from Him. And this is really the essence of stewardship. It's someone who manages what belongs to another. We have real responsibility, but not ultimate ownership. And that's a game-changer when it comes to our finances, because it requires that we ask a different question. You see, if we're an owner, we ask, "What do I want to do with my money?" But when we realize we're a steward, we ask, "Lord, what would You have me do with what You've entrusted to me?" And that posture brings both humility, because we know we can't boast in what's ultimately grace, but also help, because we know we're not carrying it alone. And then we realize at that point then, well, money then is a tool to accomplish God's purposes, and the measure, faithfulness. I'm to be faithful over time in what God has placed in my hands. And it's not faithfulness there and then, when I reach a certain amount in the checking account, or in my stock portfolio, or I get that next job. No, it's, "What does faithfulness look like today? What is that next faithful decision with what I have in my hands right now?" That really is the operative question. So, Jesus is our ultimate treasure, God owns it all, money is the tool, and faithfulness is the measure as we approach biblical finances. Think about that today as you think about the decisions you're making day in and day out. 800-525-7000 is the number to call, we'd love to hear from you today, you can call right now. Let's head to Louisiana. Hi Catherine, go ahead.
Catherine: Hi. So, I have some property with a house that was gifted to me, and I need to fix up the house. I do not want to take out a mortgage. I do have good credit, I have no credit card debt, the only debt I have is my current house payment. I'm looking, what kind of loan can I get to fix this up? And I'm looking at probably like borrowing $50,000.
Rob West: Okay. Yeah, so let me just make sure I understand. So the home is being gifted to you, and this is going to be your primary residence, is that right?
Catherine: No, it's not our primary residence. It's actually my neighbor... who was living with me, and we're going to fix it up so she can live in it until she passes. She's a little bit older. And did not have insurance on the property.
Rob West: Okay, yeah. So is your neighbor—was her house, and she's gifting it to you, or someone else is gifting it to you and you're just going to allow her to live there?
Catherine: Nope, it's her house and she is gifting it to us.
Rob West: Okay. And why is she doing that specifically? What is she hoping to accomplish, just so you can then take over the responsibility of maintaining it?
Catherine: Well, we've actually been maintaining it for the past 10 years since her husband passed. And she was going to will it to us anyways, but since the fire, she has no credit, no nothing, and needs a place to stay for the most part. And currently she's staying with us.
Rob West: Okay, yeah. And you have a mortgage on your current primary residence, or do you own that free and clear?
Catherine: No, we still have a mortgage on it.
Rob West: Okay. And but there is no mortgage on this property that's being gifted to you, correct?
Catherine: Correct.
Rob West: Okay, excellent. And you're willing to take a mortgage on this property once you receive it, or are you trying to avoid that?
Catherine: I am actually trying to avoid that, just because the interest rates are so high. I was wondering if there was another route versus getting a mortgage or a loan.
Rob West: Yeah, okay. So there's a couple of two separate decisions here. I think the gifting, unless that's already been done, I think it would be worth just looking at that, because if she plans to leave the house to you in her will anyway, you just need to know that when you have it gifted to you, it's not going to get that step-up in basis, which means someday when you eventually sell it, you're going to have to use her original cost basis versus you receiving it through her will as a part of her estate after her passing, where you'd get the step-up in basis from a tax standpoint to the current market value as of the date of death. Are you aware of the distinction between that?
Catherine: No, I am not.
Rob West: Okay. So that's just something to talk about with your CPA. If you don't have one, maybe you'd want to, you know, connect with one, because there is, you know, that pretty significant distinction. So, for instance, if she bought it a long time ago and she has a very low cost basis, that gifting is going to transfer that cost basis to you. And so at some point down the road once she passes away, if you guys decide you don't want to hang on to it and turn it into a rental or something like that and you just want to sell it, you're going to have to pay the capital gains on all the appreciation of that property from her original purchase until the date of the sale, versus you getting it at the time of her death and that cost basis stepping up to the market value as of the date of death, which means if you turn around and sell it, no capital gains at that point because you'd be selling it for the market value that became the capital gain at death. So that's just one consideration, especially since you've been maintaining it as her property. You may want to consider whether you just continue. Now, hang on the line, we'll talk about funding the repairs after the break. We'll be right back.
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Rob West: Thanks for joining us today on Faith & Finance here on American Family Radio. I'm Rob West, and we're taking your calls and questions at 800-525-7000. That's 800-525-7000. Before the break, we were talking to Catherine in Louisiana. Her neighbor has a home. Catherine and her husband have been maintaining it for her; she's elderly. She was planning to leave the home to Catherine at death, but is now wondering if she should gift the home to Catherine and her husband now. They would then maintain it, which they've been doing, but they need to put about $50,000 in it. The neighbor has no credit and is unable to do that herself. And so they would invest that money into the home. They're wondering what are the possible options for how to come up with those funds to do those renovations.
Catherine, I had shared before the break just about the consideration about receiving it now as a gift versus through the will, which would affect the cost basis whether or not you get that step-up or not. So you need to look at that. I think the second issue, depending on where you land on that, if there's still an option not to go ahead with the gifting, if that's what you decide, you know, I would be slightly concerned about you putting $50,000 into a home you don't own. And so that may be one reason why you say, "We're just going to go ahead with this, even though we're going to have the capital gains on the back end," because a will can be changed. Your neighbor could sell the property, creditors or future financial needs could intervene even beyond her ability to stop them. Despite her desire for you to get the home, you know, she could need long-term care, and, you know, that home, that property, you know, could be attached in a situation like that, you know, where now all of a sudden, you know, they're taking some of the value out of it.
So you would just need to make sure that you establish an agreement covering things like who pays for the repairs and the taxes and the insurance, whether the 50,000 is a gift or a loan or a reimbursable expense, what happens if the home is sold, and, you know, what happens if you never receive the property. Again, assuming you don't receive it—the title now—for tax purposes, you just need to make sure you understand the implications of putting a significant amount of money into a home you don't own.
Now, in terms of what are the options to come up with the 50,000, you know, if you decide not to transfer the ownership, borrowing against the house probably, you know, isn't the solution because you don't own it. So I would just look to how much of the work can be done from current cash flow, which may mean you stage this over time. You know, we haven't talked about your and your husband's financial position, but if you have the ability to fund out of some of that, either out of savings or out of just regular cash flow and stretch it out, you know, that would be one way to do it.
If she does end up gifting the house to you and you own it free and clear, really the most cost-effective way is for you to get a home equity loan or a line of credit because that's going to be the cheapest source of funds because the bank has the collateral, so it reduces their risk. And it's a variable rate, so you would get the benefit of that rate coming down as interest rates come down over time—and they will, eventually. So anyway, let me stop there and just get your thoughts on all that.
Catherine: Yeah. Um, actually, that's what I was thinking, too. So, um, like the whole electrical has to be redone, and it's unfortunately kind of a big house. So that I've been already quoted a price of like $20,000 just for that purpose, the heating, electrical, all the vents and stuff. And I was thinking about, you know, getting an area where she can live fixed right now, and then doing one room at a time after that as funds are available.
Rob West: Yes. Yeah, and I think that'd be great. And if you could do that and stretch it out over time, you know, now all of a sudden you're not having to take a loan out on it, and it does give you some flexibility to decide, "Do we actually want to get this gifted to us now, or would we rather receive it as an inheritance?" But even if you're going to stretch it out over time, just putting that amount of money into it over time, I think, would cause me to want to have an agreement in place legally that just deals with all of the possible outcomes so that you know if the home is sold or, you know, something happens, that it is in fact going to come to you or you're at least going to be made whole. You may be willing to take on that risk—I suspect you have a deep personal relationship with this person—but I just want to call that out, that you would be investing in a home in a significant way that you don't own, and there's really no guarantee that you will own it apart from just your mutual understanding, unless you memorialize that legally.
Catherine: Well, um, actually, I don't want to take on that risk because there's been a few little issues um with her changing her mind. She says I can put up a fence, and then said, "No, I don't want the fence up." And so it's been a small back-and-forth. But the whole reason she wants to gift us the property and for me to have it in my name, not only to fix it, so that we don't sell it. We actually—none of us want that land sold.
Rob West: Got it. Yeah. Yeah, that makes sense.
Catherine: So that's the whole purpose is not to sell it, because we want to maintain our country-living capacity.
Rob West: Got it. Yeah. Well, I just think, you know, these things go well until they don't! And so we just need to make sure that, you know, there's a friendship here, and you don't want it to get awkward at the same time. You just need to make sure that you do it the right way, and that it's done, you know, legally, and it's done with mutual, you know, understanding and clear communication and expectations. And then everything that is intended is documented so there's never any, you know, unmet expectations or another family coming out of the woodwork saying, "Wait a minute, you took advantage of her," or her not remembering your conversation. I think whatever you can do to just memorialize this, do it legally, aboveboard, where everybody's in agreement and, you know, has signed off on it, is the right way to do it. And that's just going to avoid any kind of confusion or relational damage or financial damage down the road.
Catherine: Yes. Well, one thing good with her situation, she actually has no family. They had no children, everybody has passed who was affiliated with the property, so it's literally just her now.
Rob West: Okay. Yeah. Yeah, that makes sense, and it's less complicated. The only other thing I might throw out is you may want to talk to an elder care estate attorney, just because if she needed to go into a nursing home and she was relying on Medicaid because she doesn't have the ability to pay, they're going to do a five-year lookback on any kind of transfers of property that would include this home. And, you know, that could be problematic because they could see that as her trying to reduce her assets to be able to qualify for government Medicaid assistance.
Catherine: Okay. I will do that.
Rob West: So that's one other thing you just need to look at, and an elder law estate attorney could help you think through that and consider that before transferring the deed, if that's the direction you all decide to go.
Catherine: Okay. Perfect. Thank you. I got a few more things to look up.
Rob West: Yes, ma'am. I hate to overcomplicate it, but this is a big decision and a pretty significant transaction, and we just want to make sure that everything's done the right way. And then that way, you know, you all can just enjoy the fruit of what you're trying to do, which is wonderful. You know, you're protecting your rural living, you're helping your neighbor and loving her well and allowing her to live out the rest of her life in a home I'm sure she loves, and especially once you make the necessary repairs. But we just don't want to do anything that's ultimately going to cause this to go south relationally or otherwise. So Catherine, thanks for your call today. If I can help further, don't hesitate to reach out. Lord bless you.
Well, we're going to take a quick break. We've got some great questions coming up that we'll dive into: Jerry in Alabama, Debbie in Texas, Patrick in Louisiana, and a quick check-in with Bob Doll on the markets. That's all on our final segment, just around the corner. Don't go anywhere.
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Rob West: So glad to have you with us today on Faith & Finance here on American Family Radio. By the way, if you have an IRA and you're over 70 and a half, you have the opportunity to do what's called a qualified charitable distribution. That's the only way to get money out of a pre-tax IRA, a traditional IRA, without ever paying tax on it. And if you'd like to consider making a gift out of your IRA, don't miss that QCD. It's an incredible benefit from a tax standpoint to get more money into God's kingdom. And perhaps you want to support the work of American Family Radio and American Family Association. I know so many of our listeners just love the work of AFA going all the way back to Brother Don, and giving a gift from your IRA could be a great way to support the ministry. If you'd like to learn more, connect with the team—Riley, Chelsea, Jessica—at the AFA Foundation. Just go to afafoundation.net; they'd love to chat with you, talk about a charitable gift annuity or a qualified charitable distribution, or maybe a gift of appreciated stock. There's a lot of those floating around. Could be a good opportunity for you to get more into the kingdom, take advantage of a tax deduction, and not pay any capital gains on appreciated stock. Again, that website to learn more: afafoundation.net.
All right, let's try to get to as many calls as we can here. We're going to head to Alabama. Jerry, thanks for your patience. Go ahead, sir.
Jerry: Oh, yes, thank you for taking my call. And I'm 80-plus years old, just retired July the 1st, and I had a 401(k) at my employer's for years, which I've been contributing to on a monthly basis. Now, my question is about an RMD. Since I worked through June, do I still have to take an RMD? Because all the years that I've been contributing, I didn't have to make an RMD.
Rob West: Mmm, yes. Yeah, and so, your question is, would this be the first year, since this is the year that you retired? Is that right?
Jerry: That is correct.
Rob West: Okay, and when was that date you separated from service?
Jerry: July 1.
Rob West: Okay. Yeah, so July 1 would be separated from service. Let me just, I'm just trying to look up how that applies here real quick. Yeah, essentially, if July 1 was your separate-from-service date, then yes, this would be your first RMD year. So, you know, you had the "still working" exception, which allowed you to delay it with a company's 401(k) or 403(b) while you remained employed. And so the 2026 RMD, because this is your first RMD from a workplace plan, you would be allowed to postpone that until April 1st of 2027. And then your 2027 RMD would be due by December 31st, 2027, so you'd have two RMDs that hit in 2027 if you take advantage of that extension until April 1st. You may rather just go ahead and keep it in this tax year, just so you don't, you know, have too much income next year that maybe causes you to have more on your Medicare premium. And so if you wanted to do that, you would need to take it by December 31st of this year, but this will be the first year, and it does need to be done either by December 31 or by April the 1st.
Jerry: Ah, excellent. Well, I appreciate that information. That was my only question, and you've done a good job answering it, so thank you.
Rob West: All right, you're welcome, Jerry. Lord bless you, my friend. All the best to you. What are you most looking forward to in this next season as you're not spending as much time in your previous work capacity?
Jerry: Well, I've been praying about that, and I'm going to see what God has in store for me.
Rob West: I love that. That's the right posture and the right approach. Let's do this: I'm going to send you a book that I think you might enjoy. It's from a friend of ours here at the ministry, Jeff Hannan. It's called An Uncommon Guide to Retirement, and maybe it'll give you a few other ideas as you think and pray through that. Jerry, hold the line, we'll get your information, and I'll put that book in the mail to you as our gift, okay? Thanks so much, Jerry.
Rob West: Well, Bob Doll is here. By the way, Debbie, Patrick, stay right there, we're going to try to get to your calls today. Bob is our go-to guy on the markets. And Bob, you know, as we start a new trading day, just check in with us on how are things looking today, and is oil still front and center above everything else?
Bob Doll: It sure is. And as you and I point out from time to time, it's up one day, it's down the next, you know, almost roll the dice, you don't know, as the war is on again, off again, the peace agreement is on again, off again, and that's just creates a lot of uncertainty. And today oil's up; yesterday was a good example, oil stocks were up and the rest of the market was kind of ho-hum. So it is a variable that's got to be watched. The price of oil has a lot to do with the US economy, global economy, earnings, inflation, and therefore the markets.
Rob West: You mentioned earnings, we've talked about their strength, but that's continuing, isn't it?
Bob Doll: It is, Rob. Earnings, as you and I have said several times, are basically off the charts. It's hard to believe, absent a recession, the growth in earnings, when you get these kind of 20 and 30% year-over-year gains, that typically only happens when you're coming out of a recession, and of course we're not. So it's very impressive. Corporate America is doing an amazing job at managing their businesses and enjoying the fruits of a consumer that's spending some money, lots of capital expenditures that have just powered our economy.
Rob West: Yeah, we've been in a raging bull market here for a long time. That's not been the case with bonds; I know you had a note about that in your deliberations this week. Share that with us.
Bob Doll: Yeah, stocks have gone up, bonds have struggled. To remind folks, the Treasury curve was basically 1% or lower yield at the height of the pandemic six years ago, and since then rates have been irregularly moving higher and therefore bond prices have been moving lower. So we're now witnessing, for most Treasury maturities, the highest interest rates we've seen in almost a decade.
Rob West: Wow. Well, something we'll keep an eye on. I know bondholders will like the reprieve. Now if you hold to maturity, it's one thing, but if you're in a bond fund, then you're bouncing all over the place, aren't you?
Bob Doll: You are, or even if you hold an individual bond, you know your yield to maturity, but in the interim it can bounce around a lot.
Rob West: Yeah, very good. All right, Bob, we appreciate it. Have a great week, my friend.
Bob Doll: You too, thanks.
Rob West: Out to Texas. Hi, Debbie, thanks for your patience. Go ahead.
Debbie: Yes, I called earlier about the Trump account, and I had a follow-up question, which is: Can you recommend a good savings account to open for someone who is about to turn 18? What would you recommend?
Rob West: Mmm, yeah. Great question, and I love the fact that you're thinking about getting them started right. You know, there are some great high-yield savings accounts out there. So I'll mention one that would be aligned with your Christian values, that would be AdelFi Christian Banking. They're offering a 4% money market right now up to $100,000 for a year, which is really nice. You could go to faithfi.com/banking; there's even up to a $400 bonus available for FaithFi listeners there. You know, in terms of other options, it does change periodically. You know, I know Capital One has their savings account and their checking or debit account is really built for teens and could be a great option for a young adult starting out. So I would look at Capital One as one option. Is it really just something that you would seed for the 18-year-old, or something that they would use day-to-day, or what are you thinking?
Debbie: It's something we'd like to build toward, I don't know, maybe when they get married and need some starter money.
Rob West: Yeah, very good. Yeah, I mean, you could look certainly at nerdwallet.com or bankrate.com, they're constantly rating these. But I would just say for an 18-year-old, I'd probably look at AdelFi, Capital One, or Ally. And, you know, they would be simple, they have great smartphone apps, no minimum balance requirements, really easy places to start learning how to manage money, and offer still pretty compelling interest rates.
Debbie: Okay, that's great. Thank you very much.
Rob West: All right. Lord bless you. Thanks for being on the program, Debbie. Let me go out to Louisiana. Patrick, go right ahead.
Patrick: Hey, thank you, Rob, for taking my call. I really appreciate all you do.
Rob West: Thank you.
Patrick: Simple question. My wife and I recently left a job with a ministry in Texas after a number of years, and there's a small amount in a 401(k), it's just a little over $10,000. Is there any advantage to just leaving that in the 401(k), or—I have a—I buy ETFs, I have a thing, an account with Fidelity, Timothy Plan. So we have those investments, would it be better to move it into that Roth IRA?
Rob West: Yeah, so is it a Roth 403(b) or 401(k), or is it traditional?
Patrick: Yes, it's traditional.
Rob West: Okay. Yeah, so that would be two steps: You would have to roll it from the 401(k) to an IRA, a traditional IRA, and if you don't have one, you'd have to open one. And then you could convert it to Roth. As long as you're okay adding that $10,000 to your taxable income, this might be a good time to do it before you start taking Social Security if you haven't already. But I like the idea of simplifying things, not leaving it in that 401(k) with one other small account to keep up with. I think it's better to get everything in one place, and I like the idea that it would eventually be in Roth. You just need to make sure you are prepared for that additional tax bill or additional taxable income, and just make sure you know what the implications are of that. But if you're pre-Medicare and you're pre-Social Security, I guess I am seeing here in the notes that you are drawing Social Security. So just make sure you understand the implications to that. It may make a little bit more of your Social Security taxable. If you're pre-Medicare, you don't have to worry about the IRMAA, so this may be a great year to do it. But eventually getting everything into one account, I think, is a good idea, Patrick. Hope that helps. Thanks for your call, sir. God bless you.
Well, that's going to do it for us today. Big thanks to my team today: Patty, Taylor, Devin, and everybody here at FaithFi. Thanks for being along with us. If you'd like to support our work here at FaithFi, we're listener-supported, go to faithfi.com/give and check it out. Consider becoming a partner, then join us tomorrow. We'll see you then.
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Rob West: Proverbs 22:7 says, "The borrower is the slave of the lender." Hi, I'm Rob West. Debt is difficult in any stage of life, but it can be especially burdensome in retirement when income is often fixed and financial flexibility is more limited. Today, Brandon Sieben joins us to talk about the rise of debt among older Americans and how biblical wisdom can help us move toward freedom. Then we'll take your calls at 800-525-7000. This is Faith and Finance on American Family Radio—biblical wisdom for your financial journey.
Well, it's a pleasure to welcome my friend Brandon Sieben back to the program. Brandon serves as Chairman of the Board at Compass Financial Ministry. Brandon, great to have you back with us.
Brandon Sieben: Thanks for having me, Rob. So encouraged to be here.
Rob West: Well, we always look forward to our time together, and I know, Brandon, you've been keeping an eye on this disturbing trend that's growing debt for folks even beyond retirement age. Give us a snapshot. How bad is it?
Brandon Sieben: Well, it's bad, Rob. According to the Federal Reserve Bank, over the past 20 years, debt levels for those in their 60s has risen by over 400%. And for those in their 70s, that grew by over 500%. So, big problem. And when we talk to folks nearing or in retirement, of all the issues they're dealing with relative to finance, debt's the biggest.
Rob West: Yeah. What kind of debt are we talking about here?
Brandon Sieben: It's a bit all over the board, but the top three we see are credit card debt—and oftentimes multiple credit cards—car loans, and home equity loans.
Rob West: Mm. And Brandon, what do you see as the cause for this increasing debt for these folks?
Brandon Sieben: Well, I'd say there's not one thing, but really a combination of factors. First, many times there's a spending problem, meaning retirees are spending like they were before retirement, but now without the income to cover the expense, so they borrow the difference. Second, a lot of folks just aren't aware of the cost of debt and how the math works. For example, you know, these days a credit card could be charging 20% interest, or a home equity loan could be as high as 10 to 12%, and people just really aren't aware of the costs there. Third, you know, a lot of people are conditioned to think that's okay, you know, no big deal. I mean, for example, I bet if you talked to nine or 10 retirees, 10 retirees, nine would tell you, "I've always had a car payment." Just kind of what we're always conditioned to do, have been. And fourth, maybe life happened. You know, maybe there's a medical emergency or they need help to get kids out of trouble, and the next thing you know, they're on the ropes. They were already living on the edge, no emergency fund, and now they have to borrow to get out of the jam they're in.
Rob West: Mm. Yeah, I certainly understand that. So, how do you counsel folks nearing retirement age or even beyond who have debt? Where do they need to go from here?
Brandon Sieben: Well, first, we tell them there are no shortcuts. You know, it's going to be hard, like going on a diet. Going to be some pain before the gain. Then we point them to God's Word first for encouragement. You know, God's pretty clear we should avoid debt. You can see that in Romans 13:8 or Proverbs 22:7. Even Jesus tells us in Matthew 6 we can't serve God and money—got to choose. And so when we're in a mountain of debt, the best first step is to get on our knees and ask God for help. And it's good. When you get debt-free, it glorifies God. Practically speaking, we find there's usually $500 to $700 a month of retiree spend that can be cut pretty quickly. Hard, but some areas include cutting back on travel, going out to eat less or not at all, canceling some or all of the home tech, like cable, or even cutting out some of those day-to-day creature comforts, like getting the manicures, pedicures, or the trips to Starbucks. And then lastly, financially speaking, we encourage people to understand the math and make the best financial decision.
Rob West: Yeah, that's so important, Brandon. And one of the real concerns here is that debt can quietly limit our availability to the Lord, especially in the later years of life. This is a season when many believers have a lifetime of wisdom, experience, perspective, and spiritual maturity to offer. They may have more flexibility to mentor younger people, serve in a church, support ministries, travel for mission work, or simply respond to needs around them. But when debt payments are pressing every month, these opportunities can feel out of reach. Instead of asking, "Lord, where are you leading me?", we can find ourselves asking, "How am I going to make the next payment?" So, the issue isn't just financial stress, it's also about freedom. Often, debt holds you back from following the leading of the Lord, doesn't it?
Brandon Sieben: It sure does.
Rob West: No doubt about it. Well, Brandon, that was great information. We really appreciate you stopping by today. I know this has been an encouragement to our listeners.
Brandon Sieben: Thanks so much. Have a great week.
Rob West: All right. That's Brandon Sieben, Chairman of the Board at Compass Financial Ministry. If you want to learn more about financial discipleship, how you can grow personally, or learn to teach others, check out their website at compassfinancialministry.org. That's compassfinancialministry.org. Back with much more just around the corner. Stick around.
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Rob West: Thanks for joining us today on Faith and Finance here on American Family Radio. Well, the lines are open. We're ready for your phone calls today. We want to help you think about the questions you have in your financial life as you progress on your stewardship journey. That's right, as you move from just getting acquainted to this idea that God owns everything, and moving throughout your financial life to a mature follower of Christ in this area of biblical financial stewardship. You know, it's something that we all need to wrestle with and think through, and think how our faith intersects with the decisions we make on a daily basis in our financial life. Well, that's precisely why we're here: to encourage you, to take you back to God's Word, but also to help you wrestle through those very practical questions you have today.
So whether it's related to your lifestyle, maybe your spending plan and balancing that budget, maybe it's getting out of debt, you've accumulated some debt—that's where we started today with Brandon Sieben. Perhaps that's true in your life, and you're wondering, "What's the best way to pay it off? Should I roll it all up into one new loan? Is there something better, perhaps debt management, debt consolidation, debt settlement?" I'll give you a quick response to that: No, it's not debt settlement or debt consolidation, but we can talk about it related to your specific situation.
Perhaps it's investing for the future. And by the way, speaking of investing, Bob Doll will stop by in our final segment today and give us a pulse on the markets as we begin the trading day. We'll get Bob's take on the latest economic data and also the on-again, off-again war in the Middle East and how that's affecting oil prices, which is showing up at the gas pump, and that's then leading back to that budget squeeze that you're facing. But there's investing questions, there's also Social Security and Medicare, and preparing the next steward. Any of those topics, we would love to tackle with you today. Lines are open, we're ready for you: 800-525-7000. That's 800-525-7000.
In the news today, married student loan borrowers face an important choice: whether to file taxes jointly or separately. And that decision can significantly affect monthly payments under the income-driven repayment plans, which are a feature of the federal loan program. Filing jointly combines both spouses' income, which can raise a borrower's required payment even if their own earnings have not changed. Filing separately, though, may reduce student loan payments, particularly when one spouse has debt and when a borrower is pursuing the Public Service Loan Forgiveness program. The new repayment assistance plan, which has been coined as RAP (R-A-P), may make this quote "marriage penalty" even larger. RAP bases payments on adjusted gross income and applies higher payment percentages as income rises, so combined spouses' earnings can push borrowers into a higher payment tier.
However, filing separately has drawbacks. It's never simple. Couples may lose access to certain tax credits and deductions, including the student loan interest deduction, and then may face a higher overall tax bill. So, bottom line: you need to compare both scenarios, calculate the tax consequences of filing separately versus jointly, then weigh those costs against potential student loan savings. Of course, a tax professional or a student loan specialist can help you determine which option produces the best overall financial outcome. Things are changing with the student loan program, and that means we need to lean back in and figure out the best option for you.
Bottom line: if you haven't borrowed yet, let's borrow as little as possible. Let's look for every option available—maybe a work-study program, maybe applying for more scholarships and grants. You know, my wife grew up in a single-parent home. Her mom made it clear, "Listen, I want you to go to college, but if you're going to do so, you're going to need to cover the cost." Well, they turned their living room into a college application scholarship application factory and just cranked those out. $150,000 in scholarships later, she was able to put herself through college completely debt-free. So, it can take some work. I had an on-campus job. I was a resident assistant my junior and senior year; that covered room and board. So, there are ways to focus on your education and offset some of those costs so that we can borrow less. You know, just because it's available doesn't mean that's the door we need to take, especially if you're pursuing a degree that's not ultimately going to lead to an income that's going to allow you to pay off the debt you're accumulating. I would say, rough rule of thumb: 10 years or less, you should be able to pay that off. If not, you're borrowing too much, and be realistic about what you can expect from that entry-level job in the career or major of your choice.
So, nevertheless, some people, you know, have to borrow, I get that. And so we just need to be careful, we need to not get overextended, and hopefully these insights can help you. All right, we're ready to dive into your questions today. Again, that phone number: 800-525-7000. That's 800-525-7000. You can call right now.
Rob West: Let's begin in Texas today. Hi, Debbie. Go ahead.
Debbie: Hello, good morning.
Rob West: Hi there.
Debbie: I have a question about the Trump account?
Rob West: Yes.
Debbie: Okay. So, when I first heard of them, they were talking about babies born this year and getting a start, and then I was surprised to hear that you can open it—and I heard several places you could open it for any child under the age of 18. But I think when I got the app and opened it up and looked, it seemed to indicate that if your child turns 18 this calendar year, they're not eligible. Would you happen to know?
Rob West: Mm, yeah. It's a great question. So, the eligibility rules are a little confusing. There's two different eligibility rules for the Trump accounts. Essentially, for an account opened in 2026, the child must not turn 18 by the end of 2026. So in practical terms, you know, the child would have been born after December 31st, 2008, and of course have a valid Social Security number. So, if it's opened this year, the child can't turn 18 by the end of this year in order to qualify.
Debbie: Okay, that's what I needed to know. Thank you very much.
Rob West: Okay, you're welcome. By the way, folks, just generally speaking, let me just say, you know, these are essentially a new type of savings account that can be very effective. Beginning July 4th of this year, so just last month, parents, grandparents, relatives, and others can contribute. Generally, private and employer contributions are subject to a combined $5,000 annual limit, with inflation adjustments beginning after 2027. And the government's $1,000 does not count against that $5,000 limit. Now, what is that? Well, that $1,000 is much narrower. It's only for children who are U.S. citizens born between January 1st, 2025, and December 31st, 2028. If they fit in that category, then they're going to get that extra $1,000 that the government—the Treasury—is actually going to put in on the child's behalf. If they don't qualify for that and they're older, less than 18, but older, then you can put in money for them, and that would allow you to go up to $5,000.
Now, an employer can contribute up to $2,500 annually toward an employee or a dependent's Trump account without that amount being taxable income to the employee, but it does count toward the $5,000 limit. And then during the growth period, the money generally must be invested in qualifying low-cost U.S. stock index mutual funds or ETFs, like tracking the S&P 500. Generally, withdrawals aren't permitted during the growth period, but after that period, it looks a lot like a traditional IRA in terms of the money coming out. So, can be a great option. Check it out at trumpaccounts.gov. More questions after this. Stick around.
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Rob West: I'm so thankful to have you with us today on Faith & Finance here on American Family Radio, helping you think through how to apply a biblical worldview to financial decision-making. We'll head back to the phones here in just a moment. We do have some lines open, by the way, if you have a question, call right now, 800-525-7000. That's 800-525-7000. You know, I mentioned that in the previous segment, that one of these key truths that we understand as we approach finances from a biblical worldview is, of course, that God is the owner of everything. It really is the starting point for biblical money management, because it puts everything, us and the money, in its proper and rightful place. And we look no further than, well, several places in Scripture to see this affirmed directly. Psalm 24:1 being the most notable: "The earth is the Lord's, and the fullness thereof; the world, and all who dwell therein." We realize that everything belongs to Him. Not only our financial resources, the dollars in the bank, but our income and our investments, our businesses, our abilities, our opportunities. Deuteronomy 8:18 though takes this a step further when it reminds us that God is the one who even gives us the ability to produce wealth. And so Scripture affirms we're to work hard, but we also understand that everything we have—our plans, our work, our relationships, our knowledge—it all comes from Him. And this is really the essence of stewardship. It's someone who manages what belongs to another. We have real responsibility, but not ultimate ownership. And that's a game-changer when it comes to our finances, because it requires that we ask a different question. You see, if we're an owner, we ask, "What do I want to do with my money?" But when we realize we're a steward, we ask, "Lord, what would You have me do with what You've entrusted to me?" And that posture brings both humility, because we know we can't boast in what's ultimately grace, but also help, because we know we're not carrying it alone. And then we realize at that point then, well, money then is a tool to accomplish God's purposes, and the measure, faithfulness. I'm to be faithful over time in what God has placed in my hands. And it's not faithfulness there and then, when I reach a certain amount in the checking account, or in my stock portfolio, or I get that next job. No, it's, "What does faithfulness look like today? What is that next faithful decision with what I have in my hands right now?" That really is the operative question. So, Jesus is our ultimate treasure, God owns it all, money is the tool, and faithfulness is the measure as we approach biblical finances. Think about that today as you think about the decisions you're making day in and day out. 800-525-7000 is the number to call, we'd love to hear from you today, you can call right now. Let's head to Louisiana. Hi Catherine, go ahead.
Catherine: Hi. So, I have some property with a house that was gifted to me, and I need to fix up the house. I do not want to take out a mortgage. I do have good credit, I have no credit card debt, the only debt I have is my current house payment. I'm looking, what kind of loan can I get to fix this up? And I'm looking at probably like borrowing $50,000.
Rob West: Okay. Yeah, so let me just make sure I understand. So the home is being gifted to you, and this is going to be your primary residence, is that right?
Catherine: No, it's not our primary residence. It's actually my neighbor... who was living with me, and we're going to fix it up so she can live in it until she passes. She's a little bit older. And did not have insurance on the property.
Rob West: Okay, yeah. So is your neighbor—was her house, and she's gifting it to you, or someone else is gifting it to you and you're just going to allow her to live there?
Catherine: Nope, it's her house and she is gifting it to us.
Rob West: Okay. And why is she doing that specifically? What is she hoping to accomplish, just so you can then take over the responsibility of maintaining it?
Catherine: Well, we've actually been maintaining it for the past 10 years since her husband passed. And she was going to will it to us anyways, but since the fire, she has no credit, no nothing, and needs a place to stay for the most part. And currently she's staying with us.
Rob West: Okay, yeah. And you have a mortgage on your current primary residence, or do you own that free and clear?
Catherine: No, we still have a mortgage on it.
Rob West: Okay. And but there is no mortgage on this property that's being gifted to you, correct?
Catherine: Correct.
Rob West: Okay, excellent. And you're willing to take a mortgage on this property once you receive it, or are you trying to avoid that?
Catherine: I am actually trying to avoid that, just because the interest rates are so high. I was wondering if there was another route versus getting a mortgage or a loan.
Rob West: Yeah, okay. So there's a couple of two separate decisions here. I think the gifting, unless that's already been done, I think it would be worth just looking at that, because if she plans to leave the house to you in her will anyway, you just need to know that when you have it gifted to you, it's not going to get that step-up in basis, which means someday when you eventually sell it, you're going to have to use her original cost basis versus you receiving it through her will as a part of her estate after her passing, where you'd get the step-up in basis from a tax standpoint to the current market value as of the date of death. Are you aware of the distinction between that?
Catherine: No, I am not.
Rob West: Okay. So that's just something to talk about with your CPA. If you don't have one, maybe you'd want to, you know, connect with one, because there is, you know, that pretty significant distinction. So, for instance, if she bought it a long time ago and she has a very low cost basis, that gifting is going to transfer that cost basis to you. And so at some point down the road once she passes away, if you guys decide you don't want to hang on to it and turn it into a rental or something like that and you just want to sell it, you're going to have to pay the capital gains on all the appreciation of that property from her original purchase until the date of the sale, versus you getting it at the time of her death and that cost basis stepping up to the market value as of the date of death, which means if you turn around and sell it, no capital gains at that point because you'd be selling it for the market value that became the capital gain at death. So that's just one consideration, especially since you've been maintaining it as her property. You may want to consider whether you just continue. Now, hang on the line, we'll talk about funding the repairs after the break. We'll be right back.
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Rob West: Thanks for joining us today on Faith & Finance here on American Family Radio. I'm Rob West, and we're taking your calls and questions at 800-525-7000. That's 800-525-7000. Before the break, we were talking to Catherine in Louisiana. Her neighbor has a home. Catherine and her husband have been maintaining it for her; she's elderly. She was planning to leave the home to Catherine at death, but is now wondering if she should gift the home to Catherine and her husband now. They would then maintain it, which they've been doing, but they need to put about $50,000 in it. The neighbor has no credit and is unable to do that herself. And so they would invest that money into the home. They're wondering what are the possible options for how to come up with those funds to do those renovations.
Catherine, I had shared before the break just about the consideration about receiving it now as a gift versus through the will, which would affect the cost basis whether or not you get that step-up or not. So you need to look at that. I think the second issue, depending on where you land on that, if there's still an option not to go ahead with the gifting, if that's what you decide, you know, I would be slightly concerned about you putting $50,000 into a home you don't own. And so that may be one reason why you say, "We're just going to go ahead with this, even though we're going to have the capital gains on the back end," because a will can be changed. Your neighbor could sell the property, creditors or future financial needs could intervene even beyond her ability to stop them. Despite her desire for you to get the home, you know, she could need long-term care, and, you know, that home, that property, you know, could be attached in a situation like that, you know, where now all of a sudden, you know, they're taking some of the value out of it.
So you would just need to make sure that you establish an agreement covering things like who pays for the repairs and the taxes and the insurance, whether the 50,000 is a gift or a loan or a reimbursable expense, what happens if the home is sold, and, you know, what happens if you never receive the property. Again, assuming you don't receive it—the title now—for tax purposes, you just need to make sure you understand the implications of putting a significant amount of money into a home you don't own.
Now, in terms of what are the options to come up with the 50,000, you know, if you decide not to transfer the ownership, borrowing against the house probably, you know, isn't the solution because you don't own it. So I would just look to how much of the work can be done from current cash flow, which may mean you stage this over time. You know, we haven't talked about your and your husband's financial position, but if you have the ability to fund out of some of that, either out of savings or out of just regular cash flow and stretch it out, you know, that would be one way to do it.
If she does end up gifting the house to you and you own it free and clear, really the most cost-effective way is for you to get a home equity loan or a line of credit because that's going to be the cheapest source of funds because the bank has the collateral, so it reduces their risk. And it's a variable rate, so you would get the benefit of that rate coming down as interest rates come down over time—and they will, eventually. So anyway, let me stop there and just get your thoughts on all that.
Catherine: Yeah. Um, actually, that's what I was thinking, too. So, um, like the whole electrical has to be redone, and it's unfortunately kind of a big house. So that I've been already quoted a price of like $20,000 just for that purpose, the heating, electrical, all the vents and stuff. And I was thinking about, you know, getting an area where she can live fixed right now, and then doing one room at a time after that as funds are available.
Rob West: Yes. Yeah, and I think that'd be great. And if you could do that and stretch it out over time, you know, now all of a sudden you're not having to take a loan out on it, and it does give you some flexibility to decide, "Do we actually want to get this gifted to us now, or would we rather receive it as an inheritance?" But even if you're going to stretch it out over time, just putting that amount of money into it over time, I think, would cause me to want to have an agreement in place legally that just deals with all of the possible outcomes so that you know if the home is sold or, you know, something happens, that it is in fact going to come to you or you're at least going to be made whole. You may be willing to take on that risk—I suspect you have a deep personal relationship with this person—but I just want to call that out, that you would be investing in a home in a significant way that you don't own, and there's really no guarantee that you will own it apart from just your mutual understanding, unless you memorialize that legally.
Catherine: Well, um, actually, I don't want to take on that risk because there's been a few little issues um with her changing her mind. She says I can put up a fence, and then said, "No, I don't want the fence up." And so it's been a small back-and-forth. But the whole reason she wants to gift us the property and for me to have it in my name, not only to fix it, so that we don't sell it. We actually—none of us want that land sold.
Rob West: Got it. Yeah. Yeah, that makes sense.
Catherine: So that's the whole purpose is not to sell it, because we want to maintain our country-living capacity.
Rob West: Got it. Yeah. Well, I just think, you know, these things go well until they don't! And so we just need to make sure that, you know, there's a friendship here, and you don't want it to get awkward at the same time. You just need to make sure that you do it the right way, and that it's done, you know, legally, and it's done with mutual, you know, understanding and clear communication and expectations. And then everything that is intended is documented so there's never any, you know, unmet expectations or another family coming out of the woodwork saying, "Wait a minute, you took advantage of her," or her not remembering your conversation. I think whatever you can do to just memorialize this, do it legally, aboveboard, where everybody's in agreement and, you know, has signed off on it, is the right way to do it. And that's just going to avoid any kind of confusion or relational damage or financial damage down the road.
Catherine: Yes. Well, one thing good with her situation, she actually has no family. They had no children, everybody has passed who was affiliated with the property, so it's literally just her now.
Rob West: Okay. Yeah. Yeah, that makes sense, and it's less complicated. The only other thing I might throw out is you may want to talk to an elder care estate attorney, just because if she needed to go into a nursing home and she was relying on Medicaid because she doesn't have the ability to pay, they're going to do a five-year lookback on any kind of transfers of property that would include this home. And, you know, that could be problematic because they could see that as her trying to reduce her assets to be able to qualify for government Medicaid assistance.
Catherine: Okay. I will do that.
Rob West: So that's one other thing you just need to look at, and an elder law estate attorney could help you think through that and consider that before transferring the deed, if that's the direction you all decide to go.
Catherine: Okay. Perfect. Thank you. I got a few more things to look up.
Rob West: Yes, ma'am. I hate to overcomplicate it, but this is a big decision and a pretty significant transaction, and we just want to make sure that everything's done the right way. And then that way, you know, you all can just enjoy the fruit of what you're trying to do, which is wonderful. You know, you're protecting your rural living, you're helping your neighbor and loving her well and allowing her to live out the rest of her life in a home I'm sure she loves, and especially once you make the necessary repairs. But we just don't want to do anything that's ultimately going to cause this to go south relationally or otherwise. So Catherine, thanks for your call today. If I can help further, don't hesitate to reach out. Lord bless you.
Well, we're going to take a quick break. We've got some great questions coming up that we'll dive into: Jerry in Alabama, Debbie in Texas, Patrick in Louisiana, and a quick check-in with Bob Doll on the markets. That's all on our final segment, just around the corner. Don't go anywhere.
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Rob West: So glad to have you with us today on Faith & Finance here on American Family Radio. By the way, if you have an IRA and you're over 70 and a half, you have the opportunity to do what's called a qualified charitable distribution. That's the only way to get money out of a pre-tax IRA, a traditional IRA, without ever paying tax on it. And if you'd like to consider making a gift out of your IRA, don't miss that QCD. It's an incredible benefit from a tax standpoint to get more money into God's kingdom. And perhaps you want to support the work of American Family Radio and American Family Association. I know so many of our listeners just love the work of AFA going all the way back to Brother Don, and giving a gift from your IRA could be a great way to support the ministry. If you'd like to learn more, connect with the team—Riley, Chelsea, Jessica—at the AFA Foundation. Just go to afafoundation.net; they'd love to chat with you, talk about a charitable gift annuity or a qualified charitable distribution, or maybe a gift of appreciated stock. There's a lot of those floating around. Could be a good opportunity for you to get more into the kingdom, take advantage of a tax deduction, and not pay any capital gains on appreciated stock. Again, that website to learn more: afafoundation.net.
All right, let's try to get to as many calls as we can here. We're going to head to Alabama. Jerry, thanks for your patience. Go ahead, sir.
Jerry: Oh, yes, thank you for taking my call. And I'm 80-plus years old, just retired July the 1st, and I had a 401(k) at my employer's for years, which I've been contributing to on a monthly basis. Now, my question is about an RMD. Since I worked through June, do I still have to take an RMD? Because all the years that I've been contributing, I didn't have to make an RMD.
Rob West: Mmm, yes. Yeah, and so, your question is, would this be the first year, since this is the year that you retired? Is that right?
Jerry: That is correct.
Rob West: Okay, and when was that date you separated from service?
Jerry: July 1.
Rob West: Okay. Yeah, so July 1 would be separated from service. Let me just, I'm just trying to look up how that applies here real quick. Yeah, essentially, if July 1 was your separate-from-service date, then yes, this would be your first RMD year. So, you know, you had the "still working" exception, which allowed you to delay it with a company's 401(k) or 403(b) while you remained employed. And so the 2026 RMD, because this is your first RMD from a workplace plan, you would be allowed to postpone that until April 1st of 2027. And then your 2027 RMD would be due by December 31st, 2027, so you'd have two RMDs that hit in 2027 if you take advantage of that extension until April 1st. You may rather just go ahead and keep it in this tax year, just so you don't, you know, have too much income next year that maybe causes you to have more on your Medicare premium. And so if you wanted to do that, you would need to take it by December 31st of this year, but this will be the first year, and it does need to be done either by December 31 or by April the 1st.
Jerry: Ah, excellent. Well, I appreciate that information. That was my only question, and you've done a good job answering it, so thank you.
Rob West: All right, you're welcome, Jerry. Lord bless you, my friend. All the best to you. What are you most looking forward to in this next season as you're not spending as much time in your previous work capacity?
Jerry: Well, I've been praying about that, and I'm going to see what God has in store for me.
Rob West: I love that. That's the right posture and the right approach. Let's do this: I'm going to send you a book that I think you might enjoy. It's from a friend of ours here at the ministry, Jeff Hannan. It's called An Uncommon Guide to Retirement, and maybe it'll give you a few other ideas as you think and pray through that. Jerry, hold the line, we'll get your information, and I'll put that book in the mail to you as our gift, okay? Thanks so much, Jerry.
Rob West: Well, Bob Doll is here. By the way, Debbie, Patrick, stay right there, we're going to try to get to your calls today. Bob is our go-to guy on the markets. And Bob, you know, as we start a new trading day, just check in with us on how are things looking today, and is oil still front and center above everything else?
Bob Doll: It sure is. And as you and I point out from time to time, it's up one day, it's down the next, you know, almost roll the dice, you don't know, as the war is on again, off again, the peace agreement is on again, off again, and that's just creates a lot of uncertainty. And today oil's up; yesterday was a good example, oil stocks were up and the rest of the market was kind of ho-hum. So it is a variable that's got to be watched. The price of oil has a lot to do with the US economy, global economy, earnings, inflation, and therefore the markets.
Rob West: You mentioned earnings, we've talked about their strength, but that's continuing, isn't it?
Bob Doll: It is, Rob. Earnings, as you and I have said several times, are basically off the charts. It's hard to believe, absent a recession, the growth in earnings, when you get these kind of 20 and 30% year-over-year gains, that typically only happens when you're coming out of a recession, and of course we're not. So it's very impressive. Corporate America is doing an amazing job at managing their businesses and enjoying the fruits of a consumer that's spending some money, lots of capital expenditures that have just powered our economy.
Rob West: Yeah, we've been in a raging bull market here for a long time. That's not been the case with bonds; I know you had a note about that in your deliberations this week. Share that with us.
Bob Doll: Yeah, stocks have gone up, bonds have struggled. To remind folks, the Treasury curve was basically 1% or lower yield at the height of the pandemic six years ago, and since then rates have been irregularly moving higher and therefore bond prices have been moving lower. So we're now witnessing, for most Treasury maturities, the highest interest rates we've seen in almost a decade.
Rob West: Wow. Well, something we'll keep an eye on. I know bondholders will like the reprieve. Now if you hold to maturity, it's one thing, but if you're in a bond fund, then you're bouncing all over the place, aren't you?
Bob Doll: You are, or even if you hold an individual bond, you know your yield to maturity, but in the interim it can bounce around a lot.
Rob West: Yeah, very good. All right, Bob, we appreciate it. Have a great week, my friend.
Bob Doll: You too, thanks.
Rob West: Out to Texas. Hi, Debbie, thanks for your patience. Go ahead.
Debbie: Yes, I called earlier about the Trump account, and I had a follow-up question, which is: Can you recommend a good savings account to open for someone who is about to turn 18? What would you recommend?
Rob West: Mmm, yeah. Great question, and I love the fact that you're thinking about getting them started right. You know, there are some great high-yield savings accounts out there. So I'll mention one that would be aligned with your Christian values, that would be AdelFi Christian Banking. They're offering a 4% money market right now up to $100,000 for a year, which is really nice. You could go to faithfi.com/banking; there's even up to a $400 bonus available for FaithFi listeners there. You know, in terms of other options, it does change periodically. You know, I know Capital One has their savings account and their checking or debit account is really built for teens and could be a great option for a young adult starting out. So I would look at Capital One as one option. Is it really just something that you would seed for the 18-year-old, or something that they would use day-to-day, or what are you thinking?
Debbie: It's something we'd like to build toward, I don't know, maybe when they get married and need some starter money.
Rob West: Yeah, very good. Yeah, I mean, you could look certainly at nerdwallet.com or bankrate.com, they're constantly rating these. But I would just say for an 18-year-old, I'd probably look at AdelFi, Capital One, or Ally. And, you know, they would be simple, they have great smartphone apps, no minimum balance requirements, really easy places to start learning how to manage money, and offer still pretty compelling interest rates.
Debbie: Okay, that's great. Thank you very much.
Rob West: All right. Lord bless you. Thanks for being on the program, Debbie. Let me go out to Louisiana. Patrick, go right ahead.
Patrick: Hey, thank you, Rob, for taking my call. I really appreciate all you do.
Rob West: Thank you.
Patrick: Simple question. My wife and I recently left a job with a ministry in Texas after a number of years, and there's a small amount in a 401(k), it's just a little over $10,000. Is there any advantage to just leaving that in the 401(k), or—I have a—I buy ETFs, I have a thing, an account with Fidelity, Timothy Plan. So we have those investments, would it be better to move it into that Roth IRA?
Rob West: Yeah, so is it a Roth 403(b) or 401(k), or is it traditional?
Patrick: Yes, it's traditional.
Rob West: Okay. Yeah, so that would be two steps: You would have to roll it from the 401(k) to an IRA, a traditional IRA, and if you don't have one, you'd have to open one. And then you could convert it to Roth. As long as you're okay adding that $10,000 to your taxable income, this might be a good time to do it before you start taking Social Security if you haven't already. But I like the idea of simplifying things, not leaving it in that 401(k) with one other small account to keep up with. I think it's better to get everything in one place, and I like the idea that it would eventually be in Roth. You just need to make sure you are prepared for that additional tax bill or additional taxable income, and just make sure you know what the implications are of that. But if you're pre-Medicare and you're pre-Social Security, I guess I am seeing here in the notes that you are drawing Social Security. So just make sure you understand the implications to that. It may make a little bit more of your Social Security taxable. If you're pre-Medicare, you don't have to worry about the IRMAA, so this may be a great year to do it. But eventually getting everything into one account, I think, is a good idea, Patrick. Hope that helps. Thanks for your call, sir. God bless you.
Well, that's going to do it for us today. Big thanks to my team today: Patty, Taylor, Devin, and everybody here at FaithFi. Thanks for being along with us. If you'd like to support our work here at FaithFi, we're listener-supported, go to faithfi.com/give and check it out. Consider becoming a partner, then join us tomorrow. We'll see you then.
Announcer: The views and opinions expressed in this broadcast may not necessarily reflect those of the American Family Association or American Family Radio.
Proverbs 22:7 says, “The borrower is the slave of the lender.” Debt is difficult at any stage of life, but it can be especially burdensome in retirement, when income is often fixed and financial flexibility is more limited. On this Faith & Finance on AFR, Rob West is joined by Brandon Sieben to talk about the rise of debt among older Americans—and how biblical wisdom can help us move toward freedom. Then Rob answers listener questions.
(00:00) Rob West and Brandon Sieben look at The Growing Debt Burden in Retirement
(10:35) In the News: The student loan marriage penalty
(14:00) Caller Debbie: Trump Accounts and who qualifies
(20:56) Rob West discusses the key truth that God owns everything
(23:42) Caller Katherine: Details of being gifted a house vs receiving it after the owner’s death
(31:26) Rob West continues his conversation with Katherine about the complexities of her situation
(43:34) Caller Jerry: Requirement for Required Minimum Distributions
(46:53) Bob Doll gives his weekly update and analysis on the markets
(49:40) Caller Debbie: Where is place to start a savings for an eighteen year old
(51:46) Caller Patrick: Moving a 401k to a Roth IRA
Proverbs 22:7 says, “The borrower is the slave of the lender.” Debt is difficult at any stage of life, but it can be especially burdensome in retirement, when income is often fixed and financial flexibility is more limited. On this Faith & Finance on AFR, Rob West is joined by Brandon Sieben to talk about the rise of debt among older Americans—and how biblical wisdom can help us move toward freedom. Then Rob answers listener questions.
(00:00) Rob West and Brandon Sieben look at The Growing Debt Burden in Retirement
(10:35) In the News: The student loan marriage penalty
(14:00) Caller Debbie: Trump Accounts and who qualifies
(20:56) Rob West discusses the key truth that God owns everything
(23:42) Caller Katherine: Details of being gifted a house vs receiving it after the owner’s death
(31:26) Rob West continues his conversation with Katherine about the complexities of her situation
(43:34) Caller Jerry: Requirement for Required Minimum Distributions
(46:53) Bob Doll gives his weekly update and analysis on the markets
(49:40) Caller Debbie: Where is place to start a savings for an eighteen year old
(51:46) Caller Patrick: Moving a 401k to a Roth IRA
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