Rob West Proverbs 16:16 says, "How much better to get wisdom than gold." Hi, I'm Rob West. In a relay race, runners don't leave the baton behind, they pass it forward to someone prepared to carry it. Shouldn't we think about inheritance the same way? It's not just about what we leave behind, but whom we prepare to carry it forward. Today Ron Blue joins us to discuss passing wisdom before wealth. And then we'll take your phone calls at 800-525-7000. This is Faith and Finance on American Family Radio, biblical wisdom for your financial decisions.
Well, it's always a special day when financial teacher and author Ron Blue joins us. Ron is widely regarded as one of the pioneers of Christian financial planning. He's founder of Kingdom Advisors and Blue Trust, and for nearly five decades has helped countless Christians see money, not simply as something to manage, but as a resource entrusted to us by God for His purposes. Ron, great to have you back.
Ron Blue Well, it's always good to be with you, Rob. Thank you.
Rob West Ron, when we talk about leaving an inheritance, we often focus on the wealth we're passing, and that's appropriate, but you've long emphasized that preparing the person who receives that wealth is perhaps more important. Why is that distinction so critical?
Ron Blue Well, wealth, all by itself, can certainly be a blessing, but money by itself doesn't produce wisdom, or character, or contentment, or purpose. And those are things that are really more important, uh, especially because that determines how you handle the wealth that is being passed. So if I transfer significant resources before someone is prepared to steward them, I may create problems for them and the kingdom that I never intended. I want to think not only about what I'm leaving behind, but who I'm leaving it to and whether that person or persons are ready. That would go for, uh, charitable gifts also, is that charity capable and, uh, of handling what I'm transferring to them. So, our goal is to prepare the person or the whoever receives it before entrusting the resources, to pass wisdom before wealth, for sure.
Rob West Yes. Well, it's such a key idea, Ron, and it goes without saying, but we have to select the next steward, right? And it might be an heir, a child or a grandchild, it might be a ministry, or both, right?
Ron Blue Sure can be. And I've seen so many situations where, uh, money that was passed, or wealth that was passed, uh, especially multi-generationally, uh, can really create, uh, anxiety and problems for those that receive it. One reason being that they did not see it being created, if you will, and don't have the same perspective on money that the one who generated it, or the family that generated it, has. So, a large inheritance can give, um, immaturity, uh, really, to a lot of people that are going to receive it. And good intentions don't guarantee good outcomes.
Rob West Yeah, that's well said, Ron. You've worked, of course, with families for decades. Without naming names, can you share an example of an inheritance that was meant to be a blessing, but ultimately became a burden because the heir wasn't prepared to receive it?
Ron Blue Well, I-I probably got too many stories, um, to talk about that. Uh, but what I have, what I have seen, uh, consistently, uh, is that, um, heirs, uh, if you don't have intentionality about preparing the heirs, uh, then it's not likely to have a good result. So my counsel has always been, think through the consequences of the wealth that you're going to pass, not only on the next generation, but on the next two or three generations. Because by the time you reach the third generation, uh, that generation probably didn't know at all the first generation, or if they did, they only knew them when they were very, very young. So, uh, wealth multi-generationally can create, uh, real problems, and that's why I say, ask yourself the question, what's the worst thing that can happen if I leave this money to, and name the person or the family? Um, because it's not going to, uh, work well unless there's intentionality of preparation, is what I would say.
Rob West Yeah, that's well said. Ecclesiastes 7 reminds us, wisdom like an inheritance is good, it benefits those who see the sun. Wisdom like money is a shelter. The advantage of knowledge is that wisdom preserves the life of its owner. We want to pass wisdom before wealth. When we come back with Ron Blue, we'll talk about how to do that. What does it look like to intentionally transfer wisdom before wealth? Teacher and author Ron Blue here today, much more just around the corner. Stay with us.
SEGMENT 2
Rob West The greatest legacy we can pass on isn't merely the wealth we've accumulated, but the wisdom to steward it well. We're talking about passing wisdom before wealth today. My guest is my friend Ron Blue. He's a financial author and teacher, he's the founder of Kingdom Advisors and Blue Trust, and, uh, was a founder of the National Christian Foundation as well. Ron, you've started a lot of organizations, haven't you?
Ron Blue Yes, I have.
Rob West (Laughs)
Ron Blue Uh, that's, uh, created great anxiety. (Laughs) So, you know, the last one I started, Judy said, "Does this mean we don't get paid again?" (Laughs)
Rob West She knows all too well what happens when a new organization is started. (Laughs) We joke, but Ron, you have, uh, had just such a profound impact on countless people for the cause of Christ through so many incredible organizations that are thriving today. And, and I know this has been a hallmark of your teaching. Uh, Splitting Heirs, I think is the very best book on a biblical approach to wealth transfer, and that's really at the core of it we're discussing today, passing wisdom before wealth to the next generation. Ron, what does preparing the next generation actually look like? What qualities or skills should we help develop in our heirs before entrusting them wealth?
Ron Blue Well, I, I had a father ask me one time, uh, "How do you train your children?" Uh, and he was looking for a quick answer, and I, and what came to mind and I, I said to him, "Sir," I said, "uh, more is caught than taught." So your heirs are going to watch how you handle money, uh, just by being a part of the household, and they're very likely to either emulate the, uh, attitudes and character that you have, or totally discard it. So, more is caught than taught. And the other thing, and this is what a lot of people don't think about, but you learn to manage money by managing money. In other words, it's not just something that's innate, but, uh, I have to make some mistakes, uh, and when I make mistakes, it's probably when I learn, uh, the most. And it's better that the heirs make those mistakes while you're there to correct them. But giving them the opportunity, especially as they get older, to, uh, manage money is a way to teach them, uh, how you do that. Uh, you don't tell them how, you let them experience the reality of the decisions that they're making.
Rob West And that may mean, Ron, that from time to time you allow them to experience the consequences of poor decision making, because as parents it's so easy, as you well know, to step in and rescue them every time and perhaps undo the lesson God is teaching them.
Ron Blue There's no question about that. Um, and as a parent, you want your kids not to suffer at all, so you hate seeing them make mistakes. Uh, and you don't intentionally, uh, put them in a position of making mistakes, but if you're giving them the ability to manage money, that might be by buying their clothes, for example, or, uh, perhaps, uh, managing even some small investments. But, uh, letting them have the experience of managing money, uh, is a way to help teach them, uh, how you do that. But I also really recommend to parents that, um, this idea of more is caught than taught—I had a father say to me, uh, when I made that statement, "You know, my kids have never seen me give, because I do all of my giving online." Now, I'm not opposed to giving online, but you are giving up example, if you will, that's right in front of their eyes when you do that. So, you know what I've said, "Do your giving while you're living so you're known where it's going." That's right. And that goes for charitable gifts as well as your heirs.
Rob West Yeah, that is well said. Ron, you mentioned a moment ago the line from Splitting Heirs: "Do your giving while you're living so you're known where it's going." I love that. What opportunities does giving during our lifetime create that simply leaving an inheritance through an estate doesn't?
Ron Blue Well, again, I'm going to come back to the joy. Um, I think when you, uh, when you give, and when you give while, uh, the heirs or the recipients, uh, or charities are still there, you get a chance to experience that joy of seeing them use something that God entrusted to you for a while. So, uh, that's one of the, uh, the biggies. And also I find that, you know, the older you get and the more your children are, uh, succeeding in life, probably the less they need. And so you end up in a question of, well, what good is this going to do, or what harm is this going to do? So now you begin looking at grandchildren and great-grandchildren. Um, and other words, I'm saying the process never ends. And shouldn't end. So, do it now. That's well said. Do some of it now, anyway, depending on the age of your children and heirs, and so forth.
Rob West Yeah, I love that, excellent. Well, Ron, we're so grateful for your wisdom, and, uh, thanks for sharing with us today. This has been really meaningful.
Ron Blue Well, thank you, Rob. It's always a treat and a pleasure. Thank you.
Rob West That's financial teacher and author Ron Blue. His wisdom helped shape our newest field guide, How Do I Prepare the Next Steward, which is available at faithfi.com/shop. That's faithfi.com/shop. We'll be back with your questions after this break. So call right now: 800-525-7000. That's 800-525-7000. Or, if you'd prefer to email your question, send it to us at [email protected]. This is Faith and Finance on American Family Radio, biblical wisdom for your financial journey. Stick around.
SEGMENT 3
Rob West So glad to have you with us today on Faith and Finance here on American Family Radio. What a treat to have Ron Blue here today. Ron is one of the founding fathers of biblical personal finance in this modern age. Ron Blue, alongside Larry Burkett and Howard Dayton—among just a few others—really have pioneered the way such that we can think about how the timeless wisdom of God's Word applies to the modern, professional financial decisions that we make on a daily basis, and understanding the heart of God as it relates to money, understanding the role of giving, understanding what wise stewardship looks like.
I'm just so thankful that even after 50 years of ministry, Ron is still blazing trails. He's actually working right now through the Ron Blue Institute on bringing biblical wisdom into universities across the country and churches across the country, just continuing to make an incredible impact. He still serves on our board of directors at Kingdom Advisors as an emeritus director and a regular contributor here, and I'm just so grateful for Ron's legacy of faith—how he has just been so faithful for so many years, the integrity with which he has operated, the vision that he's had in starting all of these organizations, including Kingdom Advisors, including National Christian Foundation, and many others. We were grateful for his time today.
All right, we're ready to turn the corner, though, and take your questions. I'm sure there are things on your mind, financially speaking, and if there are, you can call right now. 800-525-7000 is the number to call. That's 800-525-7000. We would love to hear from you today. The team is standing by, so whether it's your saving, your giving, your investments, or maybe it's your spending, trying to rein in that budget—I understand the challenge is real—call right now. We'd love to chat about it: 800-525-7000.
Let's head out to Arkansas to begin today. Jeff, you'll be our first caller, sir. Go ahead.
Jeff Hello.
Rob West Hi.
Jeff Can you hear me?
Rob West I sure can.
Jeff Okay, yes. I'm retired. I'm 68 years old. I'm wanting to transfer my 401(k) into an IRA. I only have like $25,000. I've had it very conservative. At my age and only being that low amount, should I put it in a more risky venue?
Rob West Yeah, it's a great question, Jeff. What other investable assets do you have aside from the $25,000 in the 401(k)?
Jeff And that's pretty much it. You know, I get Social Security. I do have a small lawn care company, you know.
Rob West Okay. I love that. And so you're living within your means, living exclusively off of Social Security plus the side jobs you're doing to supplement your income. Do you have an emergency fund?
Jeff Yes.
Rob West Okay, great. Yeah, I wouldn't be overly risky with it just because it's $25,000. I would always, no matter what the amount is, think about your goals and objectives. And I think putting it to work does make sense, especially because it's in a tax-deferred environment. You're going to get tax-deferred growth, which just means the taxes are not going to in any way dampen the investment results while it's growing, and then you'll pay tax on it as income as you withdraw it down the road. But you can just let it grow, especially if you don't need it.
What would be the right mix of investments? I'd probably use either an exchange-traded fund or a mutual fund. You can do one that's more passive that just mirrors a few of the market indexes. You can do one that's more active where you're hiring an investment manager with a certain style of investment and approach that fits what you're looking for. But I think probably the right mix—maybe a moderate approach—would be a 60/40 portfolio at close to age 70, where 60% is in bonds and 40% is in stocks. You certainly could dial it up more aggressive and go 50/50; you could dial it down a little more conservative and maybe go 30% stocks, 70% bonds, but you're looking for a blended fund that would offer this type of approach.
Now, with that size account, the other way you can do this is to go with what's called a robo-advisor. And basically, that just means that you are using an algorithm to invest in a way that's appropriate for your age and risk tolerance. So you'd answer a series of questions, and they would deploy a very low-cost, index-based approach to investments, but tailored to your age, stage of life, income needs, and so forth. And you could do that with one of the secular robos, or you could do it with one of the faith-based investing robos, where not only is it put into a low-cost portfolio of ETFs, but everything would be screened for biblical values, and then it's rebalanced for you over time. And the cost would probably be around 30 basis points—essentially one-third of one percent a year. And that would probably be the way that I would go, just because you would know that it's constantly being rebalanced, you've got the right mix of investments for you, and essentially you can just kind of forget about it, so to speak. I mean, you'd check on it periodically—quarterly, semi-annually, something like that—but for all intents and purposes, you'd just let it be.
Jeff All right, thank you. I sure do appreciate that.
Rob West Yeah, let me mention a couple of options. If you wanted to go a more secular approach with just traditional investments, you could look at the Schwab Intelligent Portfolios, or you could look at the Fidelity Go account—either of those: Schwab Intelligent, Fidelity Go.
If you want a faith-based approach—and I've been mentioning that there is a solution coming, and I know the principles of it, I've been watching it develop; they've been in beta, they've come out of beta, and it's ready for prime time—it's called Harvest. Essentially, it's a robo-advisor, but every investment in the portfolio is screened for biblical values. And you could open an account there quick and easy. There's no subscription fees; it's just literally 30 basis points, so less than one-third of one percent a year, no minimums, and they do IRAs, so you could roll it right in. You'd find it online at harvest-app.co. Let me give that again: harvest-app.co. And that's going to offer a faith-based robo-advisor that could be a great solution for you.
Jeff, thanks for your call today. We appreciate you being on the program.
Let's go to Ohio. Gary, how can I help you?
Gary Hi. I'm from Iowa. It gets mixed up fairly often.
Rob West Oh, no problem. And Gary, you know what? I apologize. I was not looking at the clock, and that's my fault—no one else's. So let's do this: I've got to take this break. When we come back, I want to hear your question there in Iowa, and then I'd love to give you my response.
Lines are open: 800-525-7000. Call right now and we'll be right back.
SEGMENT 4
Rob West Well, it's a beautiful day, at least here in Atlanta. I don't know where you are today, but it's delightful that you're tuning in to Faith and Finance here on American Family Radio and so grateful for your calls and your questions. We do have some lines open, so if you've got a question, something happening in your financial life, call right now: 800-525-7000. That's 800-525-7000.
Before we head back to the phones, let me just mention, we launched yesterday our year-end giving campaign here at FaithFi. We're asking if you would come alongside us to reach our giving goal in November and December of $200,000 to finish out our year and prepare for another year of ministry in 2027. We were excited that the first $14,000 toward that goal of $200,000 came in yesterday, and we are on our way toward December 31st, a goal of $200,000. It's, as a listener-supported ministry, such a critical time for us to hear from you.
And we're excited that when you give between now and December 31st, two things are going to happen: One, your gift is going to be matched—every dollar up to $200,000, we've got some generous friends that are waiting to write that check at the end of the year for whatever that total is, up to $200,000, so you're doubling your impact. Second, a gift of any amount allows us to send you a copy of Randy Alcorn's devotional, and it's a brand new 31-day devotional on biblical finance. It's his first devotional on money. He's written—this will be his 70th book, if you can believe that, but it's his first that's a 31-day devotional on money, and he's publishing it through FaithFi, and it'll be out right after the first of the year, and we will be sure you get one of the first copies when you make a gift of any amount.
So, if you love the ministry, you've been helped by it, you'd like to help us reach our goal here before year-end, head to faithfi.com/give for all the details. You can track the progress along the way through November and December. Again, that website: faithfi.com/give.
All right, back to the phones. Gary, uh, we didn't give you a chance to ask your question before the break. Now we can. Go right ahead, sir.
Gary No worries. I've been listening since Larry Burkett's been on the—on the radio, so I've been listening for quite a while.
Rob West Oh, wow. Incredible.
Gary Yes, and um, I uh retired in 2018, but I wound up uh working part-time slash full-time up until, oh, a few months ago, actually. I'm uh going to be turning 73 here next year, and I've got RMDs um in the face, and um, I'm with a company 401(k). Uh, I'm pretty conservative. I've been pretty 60/40 on the splits, and I'm talking with a certified Kingdom advisor, um, and he's and he's associated with a fairly large um firm. Uh, my question is uh how are uh fees assessed? I've never quite understood that. They're—they're at 2% and I, you know, I've uh I've got about a million dollars in my 401(k). Okay, and so is that 2% come off the top every year or how does that work?
Rob West Yeah, it's a great question. Do you know—just a quick follow-up, and then I'll give you my thoughts—do you know how the account is going to be managed? Are they going to use individual stocks and bonds? Are they going to use mutual funds and ETFs?
Gary They've got a lot of different products, but most of them are different types of mutual funds.
Rob West Got it.
Gary And, you know, you can kind of decide, you know, go go conservative or whatever.
Rob West Sure, sure. And the funds have their own internal expenses, but the 2% that you were quoted is the advisor's fee separate from the internal fees to the investments. Is that right?
Gary As I understand it, yeah.
Rob West Yeah, yeah. Okay. Yeah, I mean, the typical structure here—and and it does vary, because keep in mind, CKA means that they've earned the only industry designation for biblically wise financial advice that we put out. It's accepted industry-wide, um, and it has a high bar, and we designed it that way: 50 hours of education in a university program on biblical wisdom, an experience requirement, pastor and client references, statement of faith, a code of ethics, annual continuing education. I mean, we don't let them off easy because we want to know that they're serious about offering not only competent, excellent advice, but also they're going to do it from a biblical worldview and that they share your values. And so that's what CKA is all about.
But they don't work for us. We're a nonprofit issuing a designation and training and discipling advisors. So that means they work for their own firms, as you mentioned, this particular CKA works for a big national firm, it sounds like, and they set their own fees, which means they can charge any number of ways.
The most common structure for an advisor who's going to take what's called discretion over the account and manage the portfolio based on your goals and objectives, but making the investment decisions, would be what's called an assets under management fee, and it is typically a percentage. Now, for a million-dollar account, I would say typical would be somewhere around slightly under 1% to maybe 1 and a half percent. I would say 2% is definitely on the high side for a million-dollar account, and that's essentially an annual fee based on the assets under management charged at certain intervals. So what most advisors will do is they will charge every quarter, so every four months, three times a year, or four times a year, um, they will, you know, based on the account value, um, on the first day of the quarter, they'll take, you know, 1/4 of whatever the fee is annually, um, and then, you know, hit the charge the account, and then, you know, the next quarter whatever the account grows to, then they're going to take, you know, that that next percentage of the account. Um, and so it does put the onus on them. If they're going to get paid more, they need to grow the account, because as the account, you know, rises and falls, obviously, you know, 1/4 of let's say 1% is it could be higher or lower depending on the assets under management. But that's typically the way that works, and that would be very common. I would just say that 2% fee, um, for a million dollars is definitely on the high side.
Gary Okay. All right. Well, uh, we'll continue, uh, discussions.
Rob West All right. Thanks for your call, Gary. We'll be right back with more questions.
SEGMENT 5
Rob West Great to have you with us today on Faith and Finance here on American Family Radio. I'm Rob West. We've got some lines open today. We're taking your questions: 800-525-7000. That's 800-525-7000. You can call right now. We would love to hear from you today.
Let's head to Indiana. Nathan, how can I help you?
Nathan Good morning, Rob. I have a situation—not really a situation. My parents—my dad has passed away, but when my mom passes, they will put land, farmland, into an irrevocable trust. I have one sibling, but between my sibling and I, there will be eight grandkids to my parents.
Listening to what Rob was saying about passing on generational wealth, I guess what are the thoughts on passing on a physical asset like land in an irrevocable trust, which I think would mean that all eight need to decide whether it gets sold or divided somehow if my sister and I pass? What kind of advice do you have on that type of generational wealth? Is it good to keep the asset, or is it better to turn it into something liquid that can then be more easily addressed in the future?
Rob West Yeah, I think the latter is certainly something that you ought to explore, because the biggest concern about leaving farmland to eight grandchildren through an irrevocable trust without a clear plan for how decisions will be made is that it could result in family conflict despite the best of intentions.
So you've got a number of potential p>> Roblems. One is you've got eight different opinions. Some grandchildren may want to sell it, others may want to farm it, and others may want to collect rental income. You've got a lack of liquidity. Farmland could be worth millions—you didn't say the value, and it doesn't matter—but that doesn't mean the grandchildren have cash available for taxes, maintenance, and personal needs. Now, that could be planned for in the trust, but nevertheless, there is a lack of liquidity there.
It could be very difficult making decisions: who decides whether to sell, lease, improve, or develop the property? Does it require all eight to agree? That could create a stalemate. And then unequal benefits: what happens if one grandchild works the farm while the other seven simply receive income? How is that grandchild compensated? And then, I think finally, just the shared ownership can create resentment, especially when beneficiaries have different financial needs.
Now, just because it's in an irrevocable trust doesn't automatically mean all eight grandchildren have to agree on every decision. It could be that the trust document determines who has authority, what decisions require beneficiary approval, and whether the trustee can sell or distribute the property. But if the trust requires unanimous agreement, that could be a serious problem.
So, I think—and this may have already been done—what I would do is, before they pass away, I'd certainly have an estate planning attorney review the trust. If it's still revocable, I think there could be an opportunity to improve the provisions before they become binding. You could look at an independent trustee, you could look at buyout provisions, you could look at sale provisions, you could look at how the income is going to be distributed, and then you could look at the exit strategy if the arrangement no longer works. Those would be the common considerations when it comes to succession planning.
And then I'd also have—depending on the size of this—a CPA review the tax basis and something called generation-skipping transfer taxes so that it can be structured properly. But at the end of the day, I think you're onto something here, and I would look at whether it does make sense to perhaps liquidate this or just have a very clear plan for the path forward that does the very best you can possibly do at minimizing potential conflict.
Nathan Yeah. And then from a tax perspective, the only time it gets a step-up in basis would be when it enters the trust?
Rob West Yes, that's exactly right. So you've just got to be aware of that as well, and I think that's where the planning goes a long way toward you being able to have this efficient.
But I think the key here is that doesn't always happen either. So, if it's transferred into the revocable living trust, there's no step-up in basis, of course, when it enters the trust. If it's transferred into an irrevocable trust, there's no immediate step-up. But if it's passed into an irrevocable trust upon their death, that's where you'd get the basis adjustment, and that is a one-time event.
Nathan Okay. All right. That gave me some things to look into with some more professionals. Thank you very much.
Rob West Yeah, happy to do it. And let me make sure you get a copy of Ron Blue's book, Splitting Heirs. Nathan, we'd love for you to be able to read through that. I think that could give you a few things to think about. It's my favorite resource on this topic of biblical wealth transfer, so we'll put a copy of Splitting Heirs in the mail to you. Just hang on the line, okay?
Nathan Okay, thank you.
Rob West All right, happy to do it.
800-525-7000 is the number to call. We've got some lines open today taking your questions, and we've got just a few minutes left here before we round out the broadcast, but we would love to tackle whatever's on your mind.
Let's stay in Texas. Richard, go ahead, sir.
Richard Yeah, thank you for taking my call. Just real quick, I don't have any questions. I just wanted to bless Ron Blue. I first heard him back at Dallas Seminary in 1978, I believe, at a seminar on there. I've been a pastor, and I've used Master Your Money seminars in the churches I've been in. I highly recommend Ron Blue. I don't even know if he still prints Master Your Money—I think I found it on Amazon—but I highly recommend it. I really appreciate it. My wife and I have used the principles there—we've tried to—for the 40-plus years of our marriage. So I wanted to bless you, Ron, and thank you, and keep doing what you do.
Rob West Well, thank you for that kind remark. I'll pass it along, Richard. Ron is no longer in the studio—he's onto the next thing—but I will get him that word.
I will encourage you: first of all, I totally agree. Ron's been a mentor to me, and I appreciate you celebrating his faithful ministry of now more than five decades. Master Your Money was so influential in my life. As a college student, I read that, and it had a lot to do with the trajectory of my intersection between faith and finance. It is still in print. In fact, it's published by Moody Publishers, and they just revised and updated it. So pick up a copy—it's brand new, just revised and updated. It is a classic.
And as a thanks for calling today, Richard, hang on the line and we'll send you a copy of The Faithful Steward magazine, the latest edition. I think it'll be an encouragement to you, and thanks for celebrating Ron Blue today. We appreciate it.
Let's go to Indiana. Hi, Andy, go ahead.
Andy Thank you so much for taking my call. I just retired two weeks ago, and I have a Roth with a financial advisor who I trust. But then I also have 401(k) money. I've got a union plan with that, and then I also used to be in management with them, and I also have some funds in there.
And I was thinking, of course, of using my financial advisor—who has been real good to me with the Roth—and putting some money with him on a 401(k) to roll it over into a 401(k) with him. And then also, for the other money, I was thinking about—instead of putting all my eggs in one basket—using a different financial firm. What are your thoughts on that?
Rob West You know, I actually would prefer—especially if you've been happy and you have a trusted relationship, especially one that you've had for quite a while—my personal preference, and there's not a right or wrong decision here, would be to keep it all with one advisor.
One advisor doesn't mean all your eggs are in one basket. In fact, a single advisor can manage a very well-diversified portfolio of stocks, bonds, and other investments, and two advisors doesn't automatically reduce risk, because they might invest in some of the same funds and create unnecessary overlap. Unless they're coordinating with one another—and often they're not—it just doesn't result in you having necessarily the right mix of investments because one doesn't know what the other's doing.
So I would say if you've been happy with that relationship, and you have a trusted relationship, good communication, you're happy with the way it's been managed, how it's performed, and it fits with your risk tolerance and your goals, I would say—at least my opinion would be—let's roll that right into that same advisor and just keep going.
Andy Okay. I also wanted—my son asked me about—he's thinking about putting some money aside for his son, my grandson. What would be your recommendations on that?
Rob West Yeah. Is this for college or trade school specifically, or is it just money he would want to be available for any purpose at a time and place of his choosing?
Andy I do believe it's a combination of both.
Rob West Okay. For the college money, I would put it in a 529 plan. Think of that like a Roth IRA, but specifically for educational expenses, which could include not only a four-year degree, but community college, trade school, certain certifications, even K-to-12 expenses for private schooling. You put the money in after-tax, it gets invested, and then as long as you pull it out for qualified educational expenses—including room and board and other fees—all that gain, you don't ever pay any tax on it. And it's considered an asset of the parent, so it helps with student loans and making sure that you get credit for any kind of assistance.
So I would check out Savingforcollege.com and find out which state's plan is the best for him. It may be Indiana; it may be another one, but a 529 is the way to go.
And then for the money he wants to set aside for the kids that's not for college, I would just use a robo-advisor. A great one would be the Harvest robo-advisor that is very low cost, has no minimums, and every investment is going to be screened for your values—it's a faith-based investing approach. You can go to harvest-app.co.
I think those are going to be the best options: a 529 and then a robo-advisor for the rest. Andy, thanks for your call. God bless you, my friend.
Big thanks to my team today: Taylor, Devin, Patty, Pat, Michael, everyone here at FaithFi. Have a great day. We'll see you tomorrow.
Rob West Proverbs 16:16 says, "How much better to get wisdom than gold." Hi, I'm Rob West. In a relay race, runners don't leave the baton behind, they pass it forward to someone prepared to carry it. Shouldn't we think about inheritance the same way? It's not just about what we leave behind, but whom we prepare to carry it forward. Today Ron Blue joins us to discuss passing wisdom before wealth. And then we'll take your phone calls at 800-525-7000. This is Faith and Finance on American Family Radio, biblical wisdom for your financial decisions.
Well, it's always a special day when financial teacher and author Ron Blue joins us. Ron is widely regarded as one of the pioneers of Christian financial planning. He's founder of Kingdom Advisors and Blue Trust, and for nearly five decades has helped countless Christians see money, not simply as something to manage, but as a resource entrusted to us by God for His purposes. Ron, great to have you back.
Ron Blue Well, it's always good to be with you, Rob. Thank you.
Rob West Ron, when we talk about leaving an inheritance, we often focus on the wealth we're passing, and that's appropriate, but you've long emphasized that preparing the person who receives that wealth is perhaps more important. Why is that distinction so critical?
Ron Blue Well, wealth, all by itself, can certainly be a blessing, but money by itself doesn't produce wisdom, or character, or contentment, or purpose. And those are things that are really more important, uh, especially because that determines how you handle the wealth that is being passed. So if I transfer significant resources before someone is prepared to steward them, I may create problems for them and the kingdom that I never intended. I want to think not only about what I'm leaving behind, but who I'm leaving it to and whether that person or persons are ready. That would go for, uh, charitable gifts also, is that charity capable and, uh, of handling what I'm transferring to them. So, our goal is to prepare the person or the whoever receives it before entrusting the resources, to pass wisdom before wealth, for sure.
Rob West Yes. Well, it's such a key idea, Ron, and it goes without saying, but we have to select the next steward, right? And it might be an heir, a child or a grandchild, it might be a ministry, or both, right?
Ron Blue Sure can be. And I've seen so many situations where, uh, money that was passed, or wealth that was passed, uh, especially multi-generationally, uh, can really create, uh, anxiety and problems for those that receive it. One reason being that they did not see it being created, if you will, and don't have the same perspective on money that the one who generated it, or the family that generated it, has. So, a large inheritance can give, um, immaturity, uh, really, to a lot of people that are going to receive it. And good intentions don't guarantee good outcomes.
Rob West Yeah, that's well said, Ron. You've worked, of course, with families for decades. Without naming names, can you share an example of an inheritance that was meant to be a blessing, but ultimately became a burden because the heir wasn't prepared to receive it?
Ron Blue Well, I-I probably got too many stories, um, to talk about that. Uh, but what I have, what I have seen, uh, consistently, uh, is that, um, heirs, uh, if you don't have intentionality about preparing the heirs, uh, then it's not likely to have a good result. So my counsel has always been, think through the consequences of the wealth that you're going to pass, not only on the next generation, but on the next two or three generations. Because by the time you reach the third generation, uh, that generation probably didn't know at all the first generation, or if they did, they only knew them when they were very, very young. So, uh, wealth multi-generationally can create, uh, real problems, and that's why I say, ask yourself the question, what's the worst thing that can happen if I leave this money to, and name the person or the family? Um, because it's not going to, uh, work well unless there's intentionality of preparation, is what I would say.
Rob West Yeah, that's well said. Ecclesiastes 7 reminds us, wisdom like an inheritance is good, it benefits those who see the sun. Wisdom like money is a shelter. The advantage of knowledge is that wisdom preserves the life of its owner. We want to pass wisdom before wealth. When we come back with Ron Blue, we'll talk about how to do that. What does it look like to intentionally transfer wisdom before wealth? Teacher and author Ron Blue here today, much more just around the corner. Stay with us.
SEGMENT 2
Rob West The greatest legacy we can pass on isn't merely the wealth we've accumulated, but the wisdom to steward it well. We're talking about passing wisdom before wealth today. My guest is my friend Ron Blue. He's a financial author and teacher, he's the founder of Kingdom Advisors and Blue Trust, and, uh, was a founder of the National Christian Foundation as well. Ron, you've started a lot of organizations, haven't you?
Ron Blue Yes, I have.
Rob West (Laughs)
Ron Blue Uh, that's, uh, created great anxiety. (Laughs) So, you know, the last one I started, Judy said, "Does this mean we don't get paid again?" (Laughs)
Rob West She knows all too well what happens when a new organization is started. (Laughs) We joke, but Ron, you have, uh, had just such a profound impact on countless people for the cause of Christ through so many incredible organizations that are thriving today. And, and I know this has been a hallmark of your teaching. Uh, Splitting Heirs, I think is the very best book on a biblical approach to wealth transfer, and that's really at the core of it we're discussing today, passing wisdom before wealth to the next generation. Ron, what does preparing the next generation actually look like? What qualities or skills should we help develop in our heirs before entrusting them wealth?
Ron Blue Well, I, I had a father ask me one time, uh, "How do you train your children?" Uh, and he was looking for a quick answer, and I, and what came to mind and I, I said to him, "Sir," I said, "uh, more is caught than taught." So your heirs are going to watch how you handle money, uh, just by being a part of the household, and they're very likely to either emulate the, uh, attitudes and character that you have, or totally discard it. So, more is caught than taught. And the other thing, and this is what a lot of people don't think about, but you learn to manage money by managing money. In other words, it's not just something that's innate, but, uh, I have to make some mistakes, uh, and when I make mistakes, it's probably when I learn, uh, the most. And it's better that the heirs make those mistakes while you're there to correct them. But giving them the opportunity, especially as they get older, to, uh, manage money is a way to teach them, uh, how you do that. Uh, you don't tell them how, you let them experience the reality of the decisions that they're making.
Rob West And that may mean, Ron, that from time to time you allow them to experience the consequences of poor decision making, because as parents it's so easy, as you well know, to step in and rescue them every time and perhaps undo the lesson God is teaching them.
Ron Blue There's no question about that. Um, and as a parent, you want your kids not to suffer at all, so you hate seeing them make mistakes. Uh, and you don't intentionally, uh, put them in a position of making mistakes, but if you're giving them the ability to manage money, that might be by buying their clothes, for example, or, uh, perhaps, uh, managing even some small investments. But, uh, letting them have the experience of managing money, uh, is a way to help teach them, uh, how you do that. But I also really recommend to parents that, um, this idea of more is caught than taught—I had a father say to me, uh, when I made that statement, "You know, my kids have never seen me give, because I do all of my giving online." Now, I'm not opposed to giving online, but you are giving up example, if you will, that's right in front of their eyes when you do that. So, you know what I've said, "Do your giving while you're living so you're known where it's going." That's right. And that goes for charitable gifts as well as your heirs.
Rob West Yeah, that is well said. Ron, you mentioned a moment ago the line from Splitting Heirs: "Do your giving while you're living so you're known where it's going." I love that. What opportunities does giving during our lifetime create that simply leaving an inheritance through an estate doesn't?
Ron Blue Well, again, I'm going to come back to the joy. Um, I think when you, uh, when you give, and when you give while, uh, the heirs or the recipients, uh, or charities are still there, you get a chance to experience that joy of seeing them use something that God entrusted to you for a while. So, uh, that's one of the, uh, the biggies. And also I find that, you know, the older you get and the more your children are, uh, succeeding in life, probably the less they need. And so you end up in a question of, well, what good is this going to do, or what harm is this going to do? So now you begin looking at grandchildren and great-grandchildren. Um, and other words, I'm saying the process never ends. And shouldn't end. So, do it now. That's well said. Do some of it now, anyway, depending on the age of your children and heirs, and so forth.
Rob West Yeah, I love that, excellent. Well, Ron, we're so grateful for your wisdom, and, uh, thanks for sharing with us today. This has been really meaningful.
Ron Blue Well, thank you, Rob. It's always a treat and a pleasure. Thank you.
Rob West That's financial teacher and author Ron Blue. His wisdom helped shape our newest field guide, How Do I Prepare the Next Steward, which is available at faithfi.com/shop. That's faithfi.com/shop. We'll be back with your questions after this break. So call right now: 800-525-7000. That's 800-525-7000. Or, if you'd prefer to email your question, send it to us at [email protected]. This is Faith and Finance on American Family Radio, biblical wisdom for your financial journey. Stick around.
SEGMENT 3
Rob West So glad to have you with us today on Faith and Finance here on American Family Radio. What a treat to have Ron Blue here today. Ron is one of the founding fathers of biblical personal finance in this modern age. Ron Blue, alongside Larry Burkett and Howard Dayton—among just a few others—really have pioneered the way such that we can think about how the timeless wisdom of God's Word applies to the modern, professional financial decisions that we make on a daily basis, and understanding the heart of God as it relates to money, understanding the role of giving, understanding what wise stewardship looks like.
I'm just so thankful that even after 50 years of ministry, Ron is still blazing trails. He's actually working right now through the Ron Blue Institute on bringing biblical wisdom into universities across the country and churches across the country, just continuing to make an incredible impact. He still serves on our board of directors at Kingdom Advisors as an emeritus director and a regular contributor here, and I'm just so grateful for Ron's legacy of faith—how he has just been so faithful for so many years, the integrity with which he has operated, the vision that he's had in starting all of these organizations, including Kingdom Advisors, including National Christian Foundation, and many others. We were grateful for his time today.
All right, we're ready to turn the corner, though, and take your questions. I'm sure there are things on your mind, financially speaking, and if there are, you can call right now. 800-525-7000 is the number to call. That's 800-525-7000. We would love to hear from you today. The team is standing by, so whether it's your saving, your giving, your investments, or maybe it's your spending, trying to rein in that budget—I understand the challenge is real—call right now. We'd love to chat about it: 800-525-7000.
Let's head out to Arkansas to begin today. Jeff, you'll be our first caller, sir. Go ahead.
Jeff Hello.
Rob West Hi.
Jeff Can you hear me?
Rob West I sure can.
Jeff Okay, yes. I'm retired. I'm 68 years old. I'm wanting to transfer my 401(k) into an IRA. I only have like $25,000. I've had it very conservative. At my age and only being that low amount, should I put it in a more risky venue?
Rob West Yeah, it's a great question, Jeff. What other investable assets do you have aside from the $25,000 in the 401(k)?
Jeff And that's pretty much it. You know, I get Social Security. I do have a small lawn care company, you know.
Rob West Okay. I love that. And so you're living within your means, living exclusively off of Social Security plus the side jobs you're doing to supplement your income. Do you have an emergency fund?
Jeff Yes.
Rob West Okay, great. Yeah, I wouldn't be overly risky with it just because it's $25,000. I would always, no matter what the amount is, think about your goals and objectives. And I think putting it to work does make sense, especially because it's in a tax-deferred environment. You're going to get tax-deferred growth, which just means the taxes are not going to in any way dampen the investment results while it's growing, and then you'll pay tax on it as income as you withdraw it down the road. But you can just let it grow, especially if you don't need it.
What would be the right mix of investments? I'd probably use either an exchange-traded fund or a mutual fund. You can do one that's more passive that just mirrors a few of the market indexes. You can do one that's more active where you're hiring an investment manager with a certain style of investment and approach that fits what you're looking for. But I think probably the right mix—maybe a moderate approach—would be a 60/40 portfolio at close to age 70, where 60% is in bonds and 40% is in stocks. You certainly could dial it up more aggressive and go 50/50; you could dial it down a little more conservative and maybe go 30% stocks, 70% bonds, but you're looking for a blended fund that would offer this type of approach.
Now, with that size account, the other way you can do this is to go with what's called a robo-advisor. And basically, that just means that you are using an algorithm to invest in a way that's appropriate for your age and risk tolerance. So you'd answer a series of questions, and they would deploy a very low-cost, index-based approach to investments, but tailored to your age, stage of life, income needs, and so forth. And you could do that with one of the secular robos, or you could do it with one of the faith-based investing robos, where not only is it put into a low-cost portfolio of ETFs, but everything would be screened for biblical values, and then it's rebalanced for you over time. And the cost would probably be around 30 basis points—essentially one-third of one percent a year. And that would probably be the way that I would go, just because you would know that it's constantly being rebalanced, you've got the right mix of investments for you, and essentially you can just kind of forget about it, so to speak. I mean, you'd check on it periodically—quarterly, semi-annually, something like that—but for all intents and purposes, you'd just let it be.
Jeff All right, thank you. I sure do appreciate that.
Rob West Yeah, let me mention a couple of options. If you wanted to go a more secular approach with just traditional investments, you could look at the Schwab Intelligent Portfolios, or you could look at the Fidelity Go account—either of those: Schwab Intelligent, Fidelity Go.
If you want a faith-based approach—and I've been mentioning that there is a solution coming, and I know the principles of it, I've been watching it develop; they've been in beta, they've come out of beta, and it's ready for prime time—it's called Harvest. Essentially, it's a robo-advisor, but every investment in the portfolio is screened for biblical values. And you could open an account there quick and easy. There's no subscription fees; it's just literally 30 basis points, so less than one-third of one percent a year, no minimums, and they do IRAs, so you could roll it right in. You'd find it online at harvest-app.co. Let me give that again: harvest-app.co. And that's going to offer a faith-based robo-advisor that could be a great solution for you.
Jeff, thanks for your call today. We appreciate you being on the program.
Let's go to Ohio. Gary, how can I help you?
Gary Hi. I'm from Iowa. It gets mixed up fairly often.
Rob West Oh, no problem. And Gary, you know what? I apologize. I was not looking at the clock, and that's my fault—no one else's. So let's do this: I've got to take this break. When we come back, I want to hear your question there in Iowa, and then I'd love to give you my response.
Lines are open: 800-525-7000. Call right now and we'll be right back.
SEGMENT 4
Rob West Well, it's a beautiful day, at least here in Atlanta. I don't know where you are today, but it's delightful that you're tuning in to Faith and Finance here on American Family Radio and so grateful for your calls and your questions. We do have some lines open, so if you've got a question, something happening in your financial life, call right now: 800-525-7000. That's 800-525-7000.
Before we head back to the phones, let me just mention, we launched yesterday our year-end giving campaign here at FaithFi. We're asking if you would come alongside us to reach our giving goal in November and December of $200,000 to finish out our year and prepare for another year of ministry in 2027. We were excited that the first $14,000 toward that goal of $200,000 came in yesterday, and we are on our way toward December 31st, a goal of $200,000. It's, as a listener-supported ministry, such a critical time for us to hear from you.
And we're excited that when you give between now and December 31st, two things are going to happen: One, your gift is going to be matched—every dollar up to $200,000, we've got some generous friends that are waiting to write that check at the end of the year for whatever that total is, up to $200,000, so you're doubling your impact. Second, a gift of any amount allows us to send you a copy of Randy Alcorn's devotional, and it's a brand new 31-day devotional on biblical finance. It's his first devotional on money. He's written—this will be his 70th book, if you can believe that, but it's his first that's a 31-day devotional on money, and he's publishing it through FaithFi, and it'll be out right after the first of the year, and we will be sure you get one of the first copies when you make a gift of any amount.
So, if you love the ministry, you've been helped by it, you'd like to help us reach our goal here before year-end, head to faithfi.com/give for all the details. You can track the progress along the way through November and December. Again, that website: faithfi.com/give.
All right, back to the phones. Gary, uh, we didn't give you a chance to ask your question before the break. Now we can. Go right ahead, sir.
Gary No worries. I've been listening since Larry Burkett's been on the—on the radio, so I've been listening for quite a while.
Rob West Oh, wow. Incredible.
Gary Yes, and um, I uh retired in 2018, but I wound up uh working part-time slash full-time up until, oh, a few months ago, actually. I'm uh going to be turning 73 here next year, and I've got RMDs um in the face, and um, I'm with a company 401(k). Uh, I'm pretty conservative. I've been pretty 60/40 on the splits, and I'm talking with a certified Kingdom advisor, um, and he's and he's associated with a fairly large um firm. Uh, my question is uh how are uh fees assessed? I've never quite understood that. They're—they're at 2% and I, you know, I've uh I've got about a million dollars in my 401(k). Okay, and so is that 2% come off the top every year or how does that work?
Rob West Yeah, it's a great question. Do you know—just a quick follow-up, and then I'll give you my thoughts—do you know how the account is going to be managed? Are they going to use individual stocks and bonds? Are they going to use mutual funds and ETFs?
Gary They've got a lot of different products, but most of them are different types of mutual funds.
Rob West Got it.
Gary And, you know, you can kind of decide, you know, go go conservative or whatever.
Rob West Sure, sure. And the funds have their own internal expenses, but the 2% that you were quoted is the advisor's fee separate from the internal fees to the investments. Is that right?
Gary As I understand it, yeah.
Rob West Yeah, yeah. Okay. Yeah, I mean, the typical structure here—and and it does vary, because keep in mind, CKA means that they've earned the only industry designation for biblically wise financial advice that we put out. It's accepted industry-wide, um, and it has a high bar, and we designed it that way: 50 hours of education in a university program on biblical wisdom, an experience requirement, pastor and client references, statement of faith, a code of ethics, annual continuing education. I mean, we don't let them off easy because we want to know that they're serious about offering not only competent, excellent advice, but also they're going to do it from a biblical worldview and that they share your values. And so that's what CKA is all about.
But they don't work for us. We're a nonprofit issuing a designation and training and discipling advisors. So that means they work for their own firms, as you mentioned, this particular CKA works for a big national firm, it sounds like, and they set their own fees, which means they can charge any number of ways.
The most common structure for an advisor who's going to take what's called discretion over the account and manage the portfolio based on your goals and objectives, but making the investment decisions, would be what's called an assets under management fee, and it is typically a percentage. Now, for a million-dollar account, I would say typical would be somewhere around slightly under 1% to maybe 1 and a half percent. I would say 2% is definitely on the high side for a million-dollar account, and that's essentially an annual fee based on the assets under management charged at certain intervals. So what most advisors will do is they will charge every quarter, so every four months, three times a year, or four times a year, um, they will, you know, based on the account value, um, on the first day of the quarter, they'll take, you know, 1/4 of whatever the fee is annually, um, and then, you know, hit the charge the account, and then, you know, the next quarter whatever the account grows to, then they're going to take, you know, that that next percentage of the account. Um, and so it does put the onus on them. If they're going to get paid more, they need to grow the account, because as the account, you know, rises and falls, obviously, you know, 1/4 of let's say 1% is it could be higher or lower depending on the assets under management. But that's typically the way that works, and that would be very common. I would just say that 2% fee, um, for a million dollars is definitely on the high side.
Gary Okay. All right. Well, uh, we'll continue, uh, discussions.
Rob West All right. Thanks for your call, Gary. We'll be right back with more questions.
SEGMENT 5
Rob West Great to have you with us today on Faith and Finance here on American Family Radio. I'm Rob West. We've got some lines open today. We're taking your questions: 800-525-7000. That's 800-525-7000. You can call right now. We would love to hear from you today.
Let's head to Indiana. Nathan, how can I help you?
Nathan Good morning, Rob. I have a situation—not really a situation. My parents—my dad has passed away, but when my mom passes, they will put land, farmland, into an irrevocable trust. I have one sibling, but between my sibling and I, there will be eight grandkids to my parents.
Listening to what Rob was saying about passing on generational wealth, I guess what are the thoughts on passing on a physical asset like land in an irrevocable trust, which I think would mean that all eight need to decide whether it gets sold or divided somehow if my sister and I pass? What kind of advice do you have on that type of generational wealth? Is it good to keep the asset, or is it better to turn it into something liquid that can then be more easily addressed in the future?
Rob West Yeah, I think the latter is certainly something that you ought to explore, because the biggest concern about leaving farmland to eight grandchildren through an irrevocable trust without a clear plan for how decisions will be made is that it could result in family conflict despite the best of intentions.
So you've got a number of potential p>> Roblems. One is you've got eight different opinions. Some grandchildren may want to sell it, others may want to farm it, and others may want to collect rental income. You've got a lack of liquidity. Farmland could be worth millions—you didn't say the value, and it doesn't matter—but that doesn't mean the grandchildren have cash available for taxes, maintenance, and personal needs. Now, that could be planned for in the trust, but nevertheless, there is a lack of liquidity there.
It could be very difficult making decisions: who decides whether to sell, lease, improve, or develop the property? Does it require all eight to agree? That could create a stalemate. And then unequal benefits: what happens if one grandchild works the farm while the other seven simply receive income? How is that grandchild compensated? And then, I think finally, just the shared ownership can create resentment, especially when beneficiaries have different financial needs.
Now, just because it's in an irrevocable trust doesn't automatically mean all eight grandchildren have to agree on every decision. It could be that the trust document determines who has authority, what decisions require beneficiary approval, and whether the trustee can sell or distribute the property. But if the trust requires unanimous agreement, that could be a serious problem.
So, I think—and this may have already been done—what I would do is, before they pass away, I'd certainly have an estate planning attorney review the trust. If it's still revocable, I think there could be an opportunity to improve the provisions before they become binding. You could look at an independent trustee, you could look at buyout provisions, you could look at sale provisions, you could look at how the income is going to be distributed, and then you could look at the exit strategy if the arrangement no longer works. Those would be the common considerations when it comes to succession planning.
And then I'd also have—depending on the size of this—a CPA review the tax basis and something called generation-skipping transfer taxes so that it can be structured properly. But at the end of the day, I think you're onto something here, and I would look at whether it does make sense to perhaps liquidate this or just have a very clear plan for the path forward that does the very best you can possibly do at minimizing potential conflict.
Nathan Yeah. And then from a tax perspective, the only time it gets a step-up in basis would be when it enters the trust?
Rob West Yes, that's exactly right. So you've just got to be aware of that as well, and I think that's where the planning goes a long way toward you being able to have this efficient.
But I think the key here is that doesn't always happen either. So, if it's transferred into the revocable living trust, there's no step-up in basis, of course, when it enters the trust. If it's transferred into an irrevocable trust, there's no immediate step-up. But if it's passed into an irrevocable trust upon their death, that's where you'd get the basis adjustment, and that is a one-time event.
Nathan Okay. All right. That gave me some things to look into with some more professionals. Thank you very much.
Rob West Yeah, happy to do it. And let me make sure you get a copy of Ron Blue's book, Splitting Heirs. Nathan, we'd love for you to be able to read through that. I think that could give you a few things to think about. It's my favorite resource on this topic of biblical wealth transfer, so we'll put a copy of Splitting Heirs in the mail to you. Just hang on the line, okay?
Nathan Okay, thank you.
Rob West All right, happy to do it.
800-525-7000 is the number to call. We've got some lines open today taking your questions, and we've got just a few minutes left here before we round out the broadcast, but we would love to tackle whatever's on your mind.
Let's stay in Texas. Richard, go ahead, sir.
Richard Yeah, thank you for taking my call. Just real quick, I don't have any questions. I just wanted to bless Ron Blue. I first heard him back at Dallas Seminary in 1978, I believe, at a seminar on there. I've been a pastor, and I've used Master Your Money seminars in the churches I've been in. I highly recommend Ron Blue. I don't even know if he still prints Master Your Money—I think I found it on Amazon—but I highly recommend it. I really appreciate it. My wife and I have used the principles there—we've tried to—for the 40-plus years of our marriage. So I wanted to bless you, Ron, and thank you, and keep doing what you do.
Rob West Well, thank you for that kind remark. I'll pass it along, Richard. Ron is no longer in the studio—he's onto the next thing—but I will get him that word.
I will encourage you: first of all, I totally agree. Ron's been a mentor to me, and I appreciate you celebrating his faithful ministry of now more than five decades. Master Your Money was so influential in my life. As a college student, I read that, and it had a lot to do with the trajectory of my intersection between faith and finance. It is still in print. In fact, it's published by Moody Publishers, and they just revised and updated it. So pick up a copy—it's brand new, just revised and updated. It is a classic.
And as a thanks for calling today, Richard, hang on the line and we'll send you a copy of The Faithful Steward magazine, the latest edition. I think it'll be an encouragement to you, and thanks for celebrating Ron Blue today. We appreciate it.
Let's go to Indiana. Hi, Andy, go ahead.
Andy Thank you so much for taking my call. I just retired two weeks ago, and I have a Roth with a financial advisor who I trust. But then I also have 401(k) money. I've got a union plan with that, and then I also used to be in management with them, and I also have some funds in there.
And I was thinking, of course, of using my financial advisor—who has been real good to me with the Roth—and putting some money with him on a 401(k) to roll it over into a 401(k) with him. And then also, for the other money, I was thinking about—instead of putting all my eggs in one basket—using a different financial firm. What are your thoughts on that?
Rob West You know, I actually would prefer—especially if you've been happy and you have a trusted relationship, especially one that you've had for quite a while—my personal preference, and there's not a right or wrong decision here, would be to keep it all with one advisor.
One advisor doesn't mean all your eggs are in one basket. In fact, a single advisor can manage a very well-diversified portfolio of stocks, bonds, and other investments, and two advisors doesn't automatically reduce risk, because they might invest in some of the same funds and create unnecessary overlap. Unless they're coordinating with one another—and often they're not—it just doesn't result in you having necessarily the right mix of investments because one doesn't know what the other's doing.
So I would say if you've been happy with that relationship, and you have a trusted relationship, good communication, you're happy with the way it's been managed, how it's performed, and it fits with your risk tolerance and your goals, I would say—at least my opinion would be—let's roll that right into that same advisor and just keep going.
Andy Okay. I also wanted—my son asked me about—he's thinking about putting some money aside for his son, my grandson. What would be your recommendations on that?
Rob West Yeah. Is this for college or trade school specifically, or is it just money he would want to be available for any purpose at a time and place of his choosing?
Andy I do believe it's a combination of both.
Rob West Okay. For the college money, I would put it in a 529 plan. Think of that like a Roth IRA, but specifically for educational expenses, which could include not only a four-year degree, but community college, trade school, certain certifications, even K-to-12 expenses for private schooling. You put the money in after-tax, it gets invested, and then as long as you pull it out for qualified educational expenses—including room and board and other fees—all that gain, you don't ever pay any tax on it. And it's considered an asset of the parent, so it helps with student loans and making sure that you get credit for any kind of assistance.
So I would check out Savingforcollege.com and find out which state's plan is the best for him. It may be Indiana; it may be another one, but a 529 is the way to go.
And then for the money he wants to set aside for the kids that's not for college, I would just use a robo-advisor. A great one would be the Harvest robo-advisor that is very low cost, has no minimums, and every investment is going to be screened for your values—it's a faith-based investing approach. You can go to harvest-app.co.
I think those are going to be the best options: a 529 and then a robo-advisor for the rest. Andy, thanks for your call. God bless you, my friend.
Big thanks to my team today: Taylor, Devin, Patty, Pat, Michael, everyone here at FaithFi. Have a great day. We'll see you tomorrow.
Proverbs 16:16 says, “How much better to get wisdom than gold!” In a relay race, runners don't leave the baton behind. They pass it forward to someone prepared to carry it. Shouldn't we think about inheritance the same way? It's not just about what we leave behind, but whom we prepare to carry it forward. On this Faith & Finance on AFR, Rob West and Ron Blue discuss passing wisdom before wealth. Then, it’s on to calls.
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