Failing to plan is planning to fail. In this presentation, we take a look at the financial planning pyramid to give us a birds-eye view of the building blocks of a sound financial plan. Special emphasis is given to the areas not emphasized in previous sessions of this seminar, and also to topics related to retirement. 

<p>Failing to plan is planning to fail. In this presentation, we take a look at the financial planning pyramid to give us a birds-eye view of the building blocks of a sound financial plan. Special emphasis is given to the areas not emphasized in previous sessions of this seminar, and also to topics related to retirement. </p>

<p>Free sharing permitted under the Creative Commons <a rel="license" href="http://creativecommons.org/licenses/by-nc-nd/3.0/us/">BY-NC-ND 3.0 (US)</a> license.</p>

South Bay SDA Church

Financial Freedom Seminar

Alistair Huong

Neither Poverty Nor Riches: Busting Common Money Myths

It is a joy and privilege to be with you this evening.

As the pastor mentioned, we will be spending some time together, about 6 weeks worth, 7 altogether if you include 4th of July, and we're going to be taking a look at biblical principles on personal finance.

The Bible is not just a book of high-flung, spiritual, head-in-the-cloud type of ideas.

It actually reaches us on the ground, and nothing is more practical, nothing impacts all of us more than money.

And so we're going to be taking a look at money, we're going to be looking at principles, but we're also going to try to be making things practical.

And so today, our first topic, and I'm going to try to do my best to step back so people on this side can see, We're going to be looking at some common myths about money, 7 of them in fact, and we're going to look at what the Bible has to say about them.

So we've already had prayers, so I'm going to dive right in.

And these are, this is the preview of the topics that we're going to be covering over the 6 weeks together.

So the first 3 weeks before 4th of July, these are the topics.

We're going to talk about the money myths today.

We're going to be talking about the power to get wealth and asking the question, does God want me to be a millionaire?

The third session, we'll be looking at debt.

And that's when I'm actually going to share my story about how we bought our home, my wife and I, and how we paid it off in 2 years working on a single income.

We became a single income home after we paid off the house, so I need to be accurate about that.

So you'll have to wait until then, and if we have time, I'll tell you how I made it through my graduate program at Southern Debt Free as well.

And then we'll take a break, Fourth of July, Independence Day, we'll light some money on fire so that they blow up in the sky.

And then on the fourth session, we're gonna be talking about the B word, budgeting.

Counting the cost, saving, spending, budgeting.

And then session number 5, I will say just up front, is gonna be on the topic I get more questions about than any other, and that is investing.

Okay, anyone, any of you have questions about investing?

So we're gonna look at principles of that, and then number 6 really is gonna be, I'll be honest, number 6 is still in construction.

And part of the reason is because as we go through the next few weeks, I believe there are going to be questions that come up that are going to inform what we're gonna cover at that last session.

And really, it's gonna be taking a comprehensive look.

We're gonna look at how to plan our own finances, looking at the seasons of life, dealing with the financial planning pyramid.

It sounds all hokey, you know, like all mystical.

It's just a way of organizing a comprehensive view of our financial picture and then we're gonna 0 in on the areas that based on our discussion together, I think we need to focus on more.

So there you have it, 6 sessions coming up over the next 7 weeks.

Pastor Jeremy explained a little bit already, but on the personal, the financial side, I'm actually a professionally designated financial planner.

I actually have some training, I have the CHFC designation, I own my own practice, I have a financial planning practice, I'm a small business owner, and that's a single planner firm, so I don't have employees there, but I also work at Audioverse where I do have employees, and so I'm also an employer, so I'm an employee, I'm a business owner, entrepreneur, financial planner, and I'm an employer, so I do have a few, a little bit of experience dealing with such things.

I do have a business degree, I have a master's in business from Southern Adventist University, but more important than an MBA to deal with our money is we need to be able to do math.

So I actually was a high school teacher, math teacher as well, and so I mentioned already I got my master's degree from Southern, debt free.

The year we paid off our home, actually the month before our baby was born in 2015, we paid off our house.

We are proud parents of 2 vivacious girls.

And everybody says, oh, once you have kids, it just nukes the budget.

Well, our numbers actually doesn't bear that out.

In 2016, the first full year that we were parents, we spent 25%.

It took 25% of our take-home pay or our gross income to fund our lifestyle.

We gave away 26% and we were able to save 49%.

You know, with the economy and inflation and all the stuff we hear in the news, like we've got 2 kids now also, like it must be worse.

So last year, 2022, we actually spent 17%, we gave 27%, and we saved 56%.

So this is a little insight into our personal budget in our home.

And of course, during that time, I did have raises, so I did earn more, which certainly helps with the percentages, of course.

So, since 2015, we have been a single income home.

And this will explain a little bit why, part of the reason why we paid off our house so quickly, because my wife stays at home with the kids now, and I am the only income, bringing in the only income.

And everyone also assumes, oh, you must have a rich uncle, or you have a secret stash of Bitcoin somewhere, or gold bars that you found in the couch from Samaritan's Center.

We're very fortunate that both sets of our parents and our kids' grandparents, they're still alive, so no inheritance to speak of.

And the 1, I would say, privilege, huge privilege that we had was that our parents did pay for our undergraduate degree.

But once we got our college degree, we were on our own.

We didn't get let loose after high school.

So that was a huge blessing, and we're very thankful for that.

So I do want to add that caveat, because not everyone has that special privilege in their home.

I just want to make sure everyone can see.

So these are the 3 areas, or 3 ministries or websites where you can find more information about what I do.

Saving the Crumbs is a personal finance blog that kind of got us into the personal finance world.

My wife and I started writing this, I don't know, 2012, 2013, because we're really weird with money.

And we thought, hey, wouldn't it be fun to just document the thing and put it online?

If nothing else, it'll be fun to share with our kids someday.

Well people did start reading it and I started getting speaking invitations, GYC was a big 1, Michigan Camp Meeting, different places like that, And those messages got recorded and they got put on AudioVerse.

And AudioVerse is of course where I work, but more importantly to what we're talking about tonight, it was a platform where then many other people started hearing what I was saying.

And then I began getting individual questions, people saying, hey, can I talk to you privately?

And then it started being more than just advice and counseling, and it was like, hey, can you just manage my money for me?

I cannot do that without proper licensure and the regulations and compliance and all that good stuff.

But after the questions started coming in, I was looking around, who can I refer them to?

And these people said, we want to work with A church member, someone of our faith, someone that understands our values.

And so I got some mentors, asked them what should we do, and multiple of them just said, hey, maybe this is God telling you for you to do it.

So a couple years ago, I invested the money, went back to school, got my training.

And after that, I formed my personal finance firm, a financial planning firm called Advent Edge Financial.

And you can find the websites, you can just type them in online and Google.

The Power to Get Wealth: Does God Want Me to Be a Millionaire?

Our topic, you see on the screen, the power to get wealth?

But before we get any further, I want to just, again, remind us where we've come from, where we're headed.

So last week we discussed the topic there, neither poverty nor riches.

I'm going to share in just a moment how you can get a copy of the recording from last week and also the slides.

How to get that, I'll give you a link in just a moment.

Tonight we're gonna be talking about the power to get wealth and next week we're talking about debt.

Slaves to the lender, practical tips on dealing with debt and I'll share a story of how my wife and I paid off our house in 2 years.

And that tends to get people's attention.

But also how to buy a car without a car loan.

I'll be giving you some practical tips and what I think about credit cards and things of that nature.

And then we're going to take a break on July 4.

Everyone's going to go light some money on fire and let them make beautiful colors in the sky.

And then after that, 3 more weeks, We'll be talking about counting the costs, saving, spending, and budgeting.

And then that's all about budgeting and spending plan and all of that.

The fifth session, we'll be talking about investing.

And investing is always the number 1 question I get whenever I do these seminars.

So Just so you're aware, I will not be telling you what to invest in.

But I'll be sharing principles so that you can make your own informed decisions on how to select your investments.

And then number 6, our last session we'll be talking about financial planning, which really is going to be a comprehensive bird's eye view of how do you manage every aspect of your finances as well as dealing with finances through the seasons of life.

So that's our preview of where we're going.

Get your cell phones ready, ladies and gentlemen.

This is how you can access the recordings from previous last week, as well as this will be the link going forward.

Every week, as soon as I'm able to edit and get it posted, you will see the new presentations there and the slides that I am using will all be made available.

And there's a nice big QR code so you should, you don't really need to take a picture, you should be able to just use a QR code.

All right, so I'll give everyone just a few more moments to take the photo here and to scan their QR code.

Or you can just look on audioverse.org and look up my name and it will be the most recent presentations there.

Alright, We're going to review a couple of verses that we talked about last week regarding wealth.

That's really the purpose or the focus of our study this evening.

We discussed how wealth is kind of a paradoxical thing last week, where there's a lot of warnings against excessive wealth, there's warnings about the rich people at the end of time, it is easier for a camel to go through the eye of a needle than a rich man to enter the kingdom of heaven.

But then we also read these statements from the Bible as well.

Third John 2 says, Beloved, I wish above all things that thou mayest prosper and be in health even as thy soul prospereth.

And then Deuteronomy 8 verse 18, but thou shalt remember the Lord thy God, for it is he that giveth thee the power to get wealth.

And you notice that's where we get the title of our presentation tonight.

It is God that giveth us power to get wealth.

Well, if wealth is a bad thing, why would he give us the power to do it?

In fact, the next passage right here, Deuteronomy 28, 11.

And the Lord will make you abound in prosperity in the fruit of your womb, in the fruit of your livestock, in the fruit of your ground, within the land that the Lord swore to your fathers to give to you.

The Lord will open to you his good treasury, the heavens, to give rain to your lands in a season, and to bless all the work of your hands.

And you shall lend to many nations, but you shall not borrow." So wealth is still promoted in scripture.

And I know, let me just review, last week we discussed that the threshold, the biblical definition of wealth and prosperity is to have enough.

So it's not to have excessive wealth, to have more than we need, but it's to have what's needed to meet our needs.

And you know, wealth is 1 of those things, it's simultaneously something we all aspire to, but then it's also something that we kind of wag our tongues at.

All the Wall Street fat cats, the 1%, they need to pay their fair share in taxes, right?

We hear about this in the news all the time, But then when we think about our children and going to college, it's like, well, why do you want to take that major?

You're not going to be able to make a living.

And so all of people, you know, in the Asian culture, the parents are like, you want to be a doctor, right?

And then when we build big sanctuaries like what we're here, like what we're sitting in here, like we're very happy when somebody writes that big check to pay off the building.

So wealth is simultaneously this bad, evil, sinful, type of thing, but then secretly over here we're like, man I kind of wish we had some.

And when we're trying to raise money for God's work, we really wish we had some wealthy people in our congregation.

So the Bible gives us this paradox, but tonight I want to spend some time really thinking about wealth in a practical way.

So how much do I need to earn to be wealthy?

Seems like a question that I started wondering when I was a little kid.

Well, let's keep thinking together because a little clue, this is a bit of a trick question.

Okay, This is how we have to measure wealth.

Your assets minus your liabilities equals your net worth.

If anybody has taken basic accounting, you will know this.

This is what is revealed in a balance sheet, if you have familiarity with financial statements.

So what are assets and what are liabilities?

Well, Simply put, assets are things that we own.

Assets are things like cash in the bank, our investments, like in our 401k at work or IRA, our stocks and bonds, properties, like rental properties, and our personal residence, vehicles.

Liabilities are things that we owe or their debts, generally speaking.

So student loans, credit cards, car notes, mortgages, business loans, etc, etc.

You take everything that you own, the value of those things, you add them up, and then you take the value of all the things you owe, you subtract liability from assets, and what you have left is your net worth.

Trey earns $50, 000 a year, which as of now is below the U.S.

Slave to the Lender: Practical Tips on Dealing with Debt

We are on session number 3, night number 3 of our seminar together.

I'm going to repeat myself, but we're not meeting next week.

Next week is the 4th of July, so we will not be here, but we're glad that you're here tonight.

And you see the title on the screen, but let's do a little bit of a review, or preview rather I should say, not review.

We've already gone through 2 sessions, and We've got 3 more after tonight.

We'll skip next week, and then 3 weeks in July, we're gonna be covering sessions 4 through 6, counting the cost, gonna be looking at saving, spending, and budgeting, and then trading the talents.

That's the 1 we're gonna deal with principles on investing to help us get a foundation on how to select proper investments based on our needs.

And the last session is going to be kind of a whatever's left that I didn't finish talking about.

We're just going to cram it all in there.

But actually what we're going to be looking at is what's called the financial planning pyramid, which is like we used to have a food pyramid, right?

That gives us an outline of how to have healthy financial position, and it's going to be a comprehensive look, bird's eye view, going to be flying through a comprehensive take on all the components of our financial picture.

This is what some of you may be interested in If you missed the 2 previous sessions, they are available currently on AudioVerse.

The audio recordings as well as the slides are all there already.

I can't make any promises, but I try my best to edit these and post them as quickly as I can.

Last week I got it up the very next morning.

I can't promise you it'll be that way every week, but I will do my best.

Follow this link and you will see all of the new presentations as they are available on AudioVerse.

The whole session tonight we're going to talk about debt.

And we're going to be looking at some specific applications of debt, the main ones being car loans and student loans, credit cards, and home mortgage.

So you can get ready for those topics as we wind ourselves up here.

First question though, is being in debt a sin?

This is a question that every time I ask in most seminars, I get a mixed response.

So I'm kind of curious in this audience how we're divided here.

All right, we have 1 hand, brave soul in the back.

Okay, all right, so we're actually more unanimous here than in most other congregations.

Proverbs 22 7, the borrower is servant to the lender.

The word servant really is better translated slave.

And the original language gives a stronger connotation to it.

And Romans 13, 8 tells us to owe no man anything, but to love 1 another for he that loveth another hath fulfilled the law." Is it a sin to be a slave?

Moses was a slave for a while until he became adopted into Pharaoh's family, of course, but all of Israel were slaves.

Slavery in and of itself is not a sin, but is it a state that we want to aspire to?

If we find ourselves in slavery, I think top priority is to extricate ourselves from that situation as quickly as possible.

This is the picture that the Bible gives us about debt.

Debt in and of itself is not a sin, but it is not good either.

Elsewhere, we've been told to avoid debt like smallpox.

It's not a sin to have smallpox, but it's not something that we find a desirable state to be in.

And so we want to get ourselves out of debt as quickly as possible, even though it is not a sin.

All right, so let's take a look at some numbers here.

America is a nation of indentured servants if the debtor is slave to the lender.

The average household debt as of March 2023 is $170, 000.

Average car loan, the average amount that an American family owes on cars in 2023 is $29, 000.

The average student loan balance is almost $60, 000.

Average credit card balance, almost $18, 000.

And the total owed in the United States, we hear about the national debt, is over $17 trillion.

You know, trillion, billion, million, they all sound the same, but they're not the same.

A trillion is so unfathomable, it's really unbelievable.

Debt, it is said, is as American as apple pie.

This is a headline from last year, 2022, it says that 58% of Americans are living paycheck to paycheck after inflation spike, including 30% of those earning $250, 000 or more.

And inflation has accelerated the dilemma.

Inflation, on 1 hand, is eroding our purchasing power.

But then it forces the Federal Reserve to raise the interest rates, which means all of the debt that people are borrowing is also increased in terms of their interest rates.

Charlie Munger, who is a right-hand man of Warren Buffett at Berkshire Hathaway, he had this to say.

There are only 3 ways a smart person can go broke.

And the Legend has it that he said this during 1 of their public shareholder meetings and Warren Buffett afterwards, he edged into the mic, he said, he added liquor and ladies just to make it sound good.

Smart people think that they are so smart that they can use debt to get ahead and then all of a sudden it bites them in the rear end and then they're in trouble.

So now, earlier we said that debt is bad, but not a sin.

So is there ever a time when it is okay to have debt?

In our very first session 2 weeks ago, we looked at a story that I'm going to revisit now.

It is the story of the widow and the widow's oil.

She's a widow with 2 sons and her husband left her a big pile of debt And now the creditors are coming to take her sons as slaves to pay off the debt.

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Series

Financial Freedom Seminar

Establishing Our Plans: The Financial Planning Pyramid

Transcript

Description

Parent Series

Sponsor

Recorded

Attachments

Parts

Neither Poverty Nor Riches: Busting Common Money Myths

57m

The Power to Get Wealth: Does God Want Me to Be a Millionaire?

54m

Slave to the Lender: Practical Tips on Dealing with Debt

1h 8m

Counting the Cost: Saving, Spending, and Budgeting

56m

Trading the Talents: Principles on Investing

1h 2m

Establishing Our Plans: The Financial Planning Pyramid

1h 3m

Sound Doctrine