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2. Give a Portion to Seven: Understanding Risk and Insurance

Alistair Huong
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Living in a sinful world means that we all are at risk of emergencies and catastrophes that cost money.  How should a Christian respond to that reality?  Should we just rely on God working a miracle to provide for us?  Is it wrong or faithless to get insurance?  Is there something we can do for ourselves?  Does the God have any advice?  This presentation also specifically addresses the topic of Ellen White and life insurance.

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Alistair Huong

Executive Director of AudioVerse

Conference

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  • December 28, 2017
    10:30 AM
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This message was presented at the G.U.Y.Z. twenty seventeen conference arise in Phoenix Arizona for other resources like this visit us online at W W W dot. Org. Morning everyone it is time to get started. So. We have more space on this side now so if you have trouble seeing the screen on my left you're right. You're welcome to come over. This is our second someone our session and specifically we're going to be dealing with risk and insurance I know right insurance own so interesting. But. I think it is going to be a helpful topic for those of us who. Have to deal with such realities All right I think. Question. It depends. It depends how quickly I can get through it and also kind of questions you have no. Right now this particular seminar I think I have a feeling because we're going to be a little bit late and then we have another meeting raft words I don't want to run into them a meeting may not may not have a general This afternoon we might have a little bit more you know if it's the last meeting and tomorrow morning hoping they'll be a little shorter I'm trying to pack in as much information as I can since we're talking money and I want to give you money's worth. So if you have questions you can come to me privately and I'll I'll talk with you it's it's probably better that way. All right let's pray and we'll get started Father in heaven thank you so much for being a safety together again as we begin the second session speak to us again give us wisdom on how to manage some very practical aspects of our family and she lives we pray in Jesus' name amen. All right so for those of you who weren't here I'm going to give a little bit of an introduction. Not introduction but a little sales pitch I guess such a number to give a portion a seven understanding risk in insurance you must be thinking give a portion a seven what does that mean where does that come from well pay attention you'll find out. Saving the crumbs dot com This is a website where my wife and I write about personal for personal finance and you find a lot of information on there I'm going to give you this little teaser. This particular hour that we're dealing with insurance is completely new it's one hundred percent new material it's not on the website and it's not anything I presented anywhere before so this is you guys are the first ones to ever hear this presentation it is not found in the seminar session G.O.C. two years ago and if you want to go back and listen to all six hours this other stuff there. So risk. We need to talk about risk what is risk when we say the. We're here just a few things that we think refer to when we think about risk fire I was just in Santa Rosa California that's where my in-laws live and we drove through the neighborhoods that a scorched It is surreal it is unbelievable the devastation there and read would have an academy or school I was there saw firsthand accidents of course happen medical emergencies illness we all have heard of people who got hit by a car car accident got sick cancer heart attack whatever or people who die in flooding we had hurricane after hurricane right all through the year these are what we associate with risk but what about how does this tie into our personal finances Well the simple answer is all of these things cost money a simple way to think about risk is events that happen that causes us to lose money you get a car accident yes replace your car you get sick you have hospital bills your house burns down you have to buy a new one or replace it risk is correlated with the loss of money that's what it is but let me and make an analogy. All of these things we grouped together we call risk but I like to think of them as a ticking time bomb so we think about risk I like to I want you to have this mental picture in your mind each of us have a time bomb that is strapped to us all the time and this time bomb is ticking. We don't know when it will go off. And when it does go off we don't know how big the explosions going to be it might be a small explosion or it might be a nuclear explosion we just don't know but the reality is because we live in a sinful world we all have this ticking time bomb known as risk in our lives we can't avoid it it's a fact all we can do is manage it and thus the term risk management right so risk is a time bomb we don't know when it will go off we don't know how the explosion is but when but when it does go off what's the. I'm for occasions it will cost money to fix the problem OK so that's how it ties into personal finances it might cost a lot a lot a lot of money or might not cost that much. So is that visual picture in your head you understand what I mean when I say risk now. We have scenes that are financially risky or potentially catastrophic in our lives at any moment we might get sick we might get hit by a car hurricane might come through town or fire earthquake whatnot so what can we do about this risk we have it. We can't get rid of it we can't to fuse it so what do we do. OK Well generally we rely on someone else. Who do we rely on here are the options. OK So while we have some sort of the emergency whatever the need might be usually the first line of defense our friends and family. We go to them saying can you help me I'm sick my house burned down can I go can I come live with you you know can you provide some assistance but we all understand that there are emergencies risks that happen in our lives that are bigger than what our family and friends can absorb. And so what happens after that. There's the state the government programs Medicaid Medicare Social Security food stamps WIC program government. Children's health care all those times to all those types of programs and fema. So if there's a explosion in our lives that is bigger than what our family and friends can take care of sometimes not always sometimes the state provides safety nets in society that can help provide for some of those needs except. There are limitations you realize not everyone qualifies if you earn too much or you have certain circumstances that disqualify you you may not get those things and also I just read in the news last week the chief of fema and you realized you know what they're going to exactly stands for but they go in after the disasters and cleanup and all that basically to say he said that if the natural disasters continue at the current clip that we've been having Don't count on Fema anymore you're on your own so what does I say the state we can't necessarily count on that if there is a program that we qualify for temporarily to help get us on our feet. Yet take advantage of it I'm not saying don't take advantage of it but we can't rely on the state for all of our needs of course and here the debate about Social Security where do I see so some of us younger people who knows you know how. Much will be there when we get to retirement age we just don't know so while yes the state does have some ways to help protect us in case of the massive explosion of this ticking time bomb we can't necessarily count on them to cover one hundred percent So that leads us to our last option. Which is the church so we look to the church and when I say the church it may not necessarily mean that most church to nomination as a whole generally it's more just a local church and church members. And the church can pitch in and help and and provide. For the needs of our. The ticking time bomb that went off but there might be a question someone might be asking about God should we just trust God. Given the time bomb he'll just take care of it and he'll just shield us from the consequences of emergencies that happen is that how the world works. What we do want to trust in God but let's see what how does God deal with a problem so isn't this God's problem and we think about risk and emergencies and catastrophes that happen testimony for the church on for page five eleven paragraph one God does not propose to rain means from heaven with which to sustain the poor but he has placed his goods in the hands of agents so notice carefully. God's plan of action is not to work a miracle from heaven to fix our problems. Even though sometimes that's what we associate we just assume that God is just going to miraculously prove fix the problem and sometimes he does intervene like I just share the story about how he you know how divine appointment and he work things out I'm not saying that God does not work but notice how he typically chooses to work he places his goods in the hands of his agents. They are to recognize Christ in the Person of the saints and what they do for suffering children they do for him for he identifies his interest without a suffering humanity. So the put it simply when we think about God will provide right I'm not going to buy insurance I'm not going to take care of you know I'm going to have health insurance or whatever it might be I'm going to trust in God What are we actually saying we're saying I expect the church to take care of me that's really what we're saying. So let's take a look at the next slide here so the church is God's agent when we read that statement God does not propose to rain means from heaven that's not his first primary mode of operation is the reigning man it is not his first option is first option as he looks to us people say you help them you help the people in need so the church is God's agent for helping the poor and needy in the church and in the world Amen that's what the church is here for Matthew twenty five you know and all that however the church is not God's agent for helping those who can help themselves in the church or in the world. You understand the difference there's a very big difference between these two statements if we have the opportunity the ability to provide for ourselves but we expect the church to take care of us guess what that's not the church's responsibility let's make this clear. Testimonies for the church Volume two seventy five page seventy five one the prominent position which you as a family occupying the church makes it highly necessary for you to be burdened bearers. Not that you are to take burdens for those who are able to bear their own and also date others but you should help those who stand most in need of help so you know to sell what makes very clear yes you need to help the poor or but don't help those who can help themself. Divert your attention to those who really need the help this make this even clearer next statement testimonies for the church Volume one page two seventy two paragraph two and God does not require our brethren to take charge of every poor family that shall embrace the message if they do this is the Ministers must cease to enter new fields for the funds will be exhausted so there's a correlation the money that goes up the poor is coming from somewhere else. Many of the poor from their own lack of diligence and a calming. Many many are poor from their own lack of diligence economy they know not how to use means right if they should be helped it would hurt them and some will always be poor. Does Ellen White recommend us helping the poor or yes does she recommend us helping anyone who is poor know that this might be tough for us to handle we might look at the same and say Man that's harsh but you've got to understand why she said it it's right here. Because if we do that the work of God to taking the gospel to the world and whatever else might be won't be finished because of the poor will always have with us and some is has will always be for so what am I trying to say we're not necessarily here talking about you know the pro appropriate ways of handling charity and and philanthropy and all those kinds of things I'm talking about us in the situation if we have the capability through our own diligence and economy to take care of our needs. We are not the church's responsibility to take care of that's my point. So is there a better way we've got to remember. So let's say our family and friends you know we we don't want to hit them up for money all the time we don't want to take advantage of them the state we don't qualify for whatever programs or they run out of money and the church you know we want the money to stay in the church we realize every dollar we take from the church represents a dollar that could have gone to another part of God's work as faithful stewards we realize that that money should be going when the last not necessarily take care of me and we understand that to take care of us scuse me and go back. To take care of us when we can take care of ourselves is not the responsibility of the church. So we have to keep this thought in mind so was there a better way so if if we look at these four options and we don't qualify for them we should take advantage of our friends and family and and we should take care of ourselves and not rely on the just what do we do what are the options. So this is the option the most Americans today take. It and you know what if you have an emergency that just blew up your personal finances. And they're like your financial house is just like engulfed in flames and you go running to a credit card you know what you're doing you point gasoline on the fire you're making it worse because if you can't pay the bills how do you expect to pay the bills with interest I mean it makes no sense so for us easy credit seems like a way out but it's actually digging a deeper hole it just keeps us in slavery. So scratch that credit card no good Here's a better option self-reliance and independence of a certain kind of to make that qualification when we hear this statement over you need to be self-reliant and sell and independent you might be thinking like that goes contrary to everything we were taught as evidence right when we read about legacy of. It was a probably the C.E.O. says though are rich and increase with goods and have need of nothing that's the problem with a A C. is self-sufficiency self dependence but that's not what I'm talking about yes Linda C. is true but there is a certain type of self-reliance and independence that is admirable that should be a strong a strong striven for and this is what it is Agnes home page three seven four Paragraph one independence of one kind is praiseworthy to desire to bare your own weight not to eat the bread of dependence on wine to remember this word dependence this word comes up over and over again and this is a key point to not eat the bread of dependence is right it is a noble generous ambition that dictates the wish to be self supporting So what kind of self-reliance and independence are we talking about the ability to take care of ourselves to not be dependent on someone else that's what we're talking about we're not talking about being independent from God and not saying be self sufficient in our own righteousness It's not about that we're talking about taking care of our material needs next statement. Evidence on page three hundred five paragraph one brother and sister B. have not learned the lesson of economy. They would use all as they pass along were it ever so much they would enjoy as they go and then when affliction draws upon them would be wholly unprepared that's another way of saying when their time bomb of risk goes off they would be unprepared why because as they were living their life they were just enjoying life and they just spending everything as they go making no preparation to be self reliant continuing this and same statement. But they will not economize as others have done upon whom they have sometimes been dependent there's that word again these people because they were not willing to keep their spending in check now when they run into a hard time. Of go to the church and help. If they neglect to learn these lessons this is the clincher their characters will not be found perfect in the day of God. This is a spiritual issue people. This issue that a lot is discussing here the desire to not suffer the consequences of our own choices they will testify against us in the judgement let me make this clear I put this in writing so I don't mis stated it's a character issue if we have the ability whether through economy or diligence to provide for our needs but expect others to bail us out it is a character defect that testifies against us in the judgement. This is an important point and I'm going to make this even more blunt to put it bluntly when we have the ability to provide for ourselves but want others to shield us from the consequences of our own choices we are defrauding our neighbor because think about it if I could have made a preparation to take care of my needs when the emergency comes and I have to take your money that money that would have gone to win a soul in some other place guess what I have done I have stolen the gospel from some. Defrauding our neighbor maybe I'm putting it too harshly but let me just put it this way if all of us like we just had a pathways to health it's wonderful thing helping all these people but if we have to spend all that time ministering to our own needs within the church. What what's left to take care of the people who are sick and dying in the world you know Stan I'm saying that we need to be in a position to help other people not requiring care but I'm getting myself ahead of myself here so this statement is very pointed and this state was going to come back multiple times so it was selected messages on two to three thirty programs to diligence in business. Abstinence from pleasure even privation so long as health is not in danger should be cheerfully maintained by a young man in your circumstances and you would have a little competency untouched should you become sick that the charities of others would not be your dependents there's that word again don't be dependent don't be dependent don't be dependent and to what lengths should be we should we be willing to go to not be dependent number one we should be diligent in business we should be diligent business no matter what absence from pleasure now this one's tough can you give up your Netflix subscription your the latest i Phone the nicest car in order so you can have a little bit of competency to shield yourself from needing to depend on other people that's the question even privations L.-Y. does go so far to say better to sacrifice and suffer a little bit so you don't have to rely on other people to take care of you. As long as you know endanger health to do it that's a qualification so what's the principle here be self reliant be independent what's the point so that we do not have to be dependent on the charity of other people I'm drilling this point home because this is foundational to the whole hour that we're going to talk about here. And this is another angle here Deuteronomy fifteen sixty six for the Lord thy God blesses the S.E.'s promise the induction Lennon to many a nation that thou shall not borrow. So was the position of God desires of people to be in it to be the position of rendering aid not requiring aid you see that in the statement we should be the one giving lending out from our surplus helping other people not the one sitting there saying well I trust in God Now I'm sick so you have to pay for my health bill you see the difference we should be in the position of going to help the poor not being the poor that needs help. So what's the good kind of self-reliance this principle that we're talking about we need to be willing to bear our own weight willing to rough it be willing to sacrifice a little bit go out there and and work hard be economical and frugal be industrious be self-supporting does not depend on the charity of others that's a key point and to be able to give aid rather than requiring aid that's the position that God wants us to be in if that is clear the same and all right so those are the principles and now let's get specific and let's get practical So how right how do I become self-reliant. Well first first step we need to build an emergency fund emergency fund is the first line of self defense if I can put it this way emergency fund is a cushion that we place between us and the time bomb. We have this time bomb right of risk that's strapped to us is going to go off but we just want that little bit of separation so we have an emergency fund is like a I don't know hazmat suit a little bubble wrap I don't know what it is what mental picture you want but you've got a cushion now for the types of things like inevitably will come up here's a statistic the shocking to me this was in Forbes magazine twenty sixteen sixty three percent of Americans don't have enough savings to cover a five hundred dollars mergence e. I hate to say this but five hundred dollars in today's society should not qualify as emergency. If five hundred dollars raises your your blood pressure like you'd like if you have an emergency something happens and it cost you five hundred dollars and you're like all panicked about it that's a symptom that you've got a bigger financial problem because five hundred dollars should not you should not blink it should not cause you to lose a wink of sleep but sixty three percent of Americans cannot weather a five hundred dollars that's a crisis so we need an emergency fund to deal with those kinds of emergencies a cushion right that can absorb at least five hundred dollars worth of damage we got to have that evidence home three ninety five paragraphs three you might today have had a capital of means to use in case of emergency and to aid the cause of God If you have economize as you should every week a portion of your wages should be reserved and in no case touched a less suffering actual want or to render back to the giver and offerings to God A white is a big proponent of an emergency fund a man you see that very clear So what's an emergency fund. A minimum of three to six months of living expenses so a dollar figure you want to dollar figure go back to your monthly spending how much do you spend per month multiply that out three to six months and this is minimum if you have a fluctuating income maybe you're a sales person or your you work a seasonal You might want to bump that up to six to nine or maybe a year. Or in my particular situation with my family because our household income is so low we need to have enough to cover for the ductile for insurance plans and things like that so ours is more like twelve months but twelve months is actually still not that much for us. But three six months minimum living expenses not income and of course the understanding is that your living expenses should be quite a bit lower than your income but if your living expenses is higher than your income and you've got another problem all together we'll talk about that this afternoon so for an aversive one excuse me emergency fund where should I put it it should be kept in f.d.i.c or N.C.U.A. insured accounts f.d.i.c are for banks and see us for credit unions so it insures your account up to two hundred fifty thousand dollars so in the event that the bank goes down your money is insured you don't want to lose the money it's a safety net not an investment OK So that's the reason why we were not putting in the stock market we're not investing in land or something you want to liquid So if you have an emergency you have access to it OK and you. You want to insure it so that it doesn't go on down in value right when you need it when you have an emergency so this emergency fund is not for investing you're not looking at gaining a lot of money on it you're not necessarily growing it is just a cushion that you stick right there in between you and that time bomb you don't want to touch it except with genuine emergencies so new i Phone comes out you want to that's not an emergency OK just make that clear your friend decides to go out to eat and you. Realize you spend all your money for the month not an emergency you might lose some face your friends might make fun of you might be a different type of emergency but doesn't qualify for this OK. And what's amazing what's amazing is that once you have an emergency fund in place you find that you have a lot fewer emergencies it's really really strange how that work is like before you have an emergency fund is like every week some crisis comes up once you have an emergency fund like life is so chilling there's no nothing ever goes wrong anymore well the reason is because you've built a cushion in your life so the things the five hundred dollar things that used to be emergencies all of sudden they're no longer emergencies so having emergency fund it's better for your health better for your sleep or for your stress level highly recommended but what about bigger risks so you all know in this day and age. Saving three to six months of living expenses Yeah that's great. And by the way three to six months the reason they say that is because that is generally about how long if you lose a job how long it takes to get back on your feet to get another job so that's one of the reasons. But we realize. That sometimes. That time bomb goes off and they can wipe out not just three to six months of income it might be three to six years or more. So what do we do Ecclesiastes eleven verse to. Give a portion a seven and also to eight for the know it's not what evil should be upon the earth and this is where we get the title of our seminar so when there's a big catastrophe. Ecclesiastics tells us to diversify our risk OK. And. What does that mean. Well this is in a way a description of how insurance works you have a big pot of money that everybody chips into so you're dividing it up between seven or eight people everyone or more right thousands or millions of people everyone chips in their monthly premium. And when a few of the people ends up having a gigantic catastrophe there's a big pot of money ready to come to their aid and the assumption is not everyone is going to need to be withdrawing all the same time and so everyone chips in a little bit. But yet everybody gets access to it when the time comes that's the general principle of insurance. So insurance is the next step beyond having emergency fund to take care of this these ticking time bomb situations that are much bigger than what our emergency fund can cover. What does oh I have to say well this is not a white This is Willie talking about this was August twenty eighth a letter he wrote in August twenty eight nine hundred thirty two sometime after her death several times I've been present when this matter was discussed in the presence of Sister White and each time she has advised us that it is well to ensure meeting houses and our situations. On one occasion she remarked that if we should become known that we did not ensure our meeting houses in our institutions and that the enemies of our faith would take great delight in burning them. This is a. I don't know if this is supposed to be a humorous statement or sort of a morbid statement because you know the advent of history with institutional fires. But what she's saying. According to Willie is that it is presumptuous for us to not insure our buildings. Exactly Amen. Because if we don't insure it and the enemies of God know what they know they can set back our work by just burning our buildings is presumptious not to have insurance Corps to the statement. On another occasion she said Certainly if there is a debt on a church The only honest thing we can do is ensure it thus providing for the protection from Lost of those who lend money to us so very clearly according to Willie at least is in favor of having insurance for those catastrophic expenses that are far beyond what our personal savings or emergency savings would be able to cover and she goes so far to say it is presumptuous to not have insurance. And she also says we need to do it if you know we borrowed money to build those those buildings. Are we read this quote in the last hour of course that was Willie's comments but let's see what Ellen White herself said so she says I wish I wish you would see to that the House of Healdsburg is insured talk to listen about feel anxious in regard to it nine hundred eighty three four she says Brother Palmer says he has written to him regard to insurance of the house is not assured it should be I want to sell what is very much in favor of at least in these cases specifically property insurance. So we're using the principles that were deriving from those statements for risks larger than we can afford to cover their personal savings we should get insurance. Not to have insurance for these things is presumption because one of the BE EASY for the enemies of God to just comply. Really derail God's people by just causing calamities for all the things that we have made no preparations for. In fact she said that as much. But this is how the emergency fund and insurance ties together emerge in our emergency fund should be adequate to cover the deductible and out of pocket maximums of our health and or of our insurance policies so emergency fund. Yes three to six months expenses generally is what we're looking at but like in our case our three to six months expenses are so low that it would not cover for the deductible for a home insurance or health insurance so we have to raise it in order to make sure that we have enough to cover our health insurance deductible and out of pocket maximum Now I know this is insurance lingo in a sort of boring but I think is important though was to duck the bill the deductible is the part of the insurance that you have to pay before the insurance company picks up the rest and out of pocket maximum is the maximum amount that you can pay before the insurance company picks up everything so sometimes after the doctor will you still pay fifty percent or twenty percent or co-pay even after you meet your deductible whereas the deductible you cover a hundred percent in a way. Don't need to get too far into that but just know your emergency fund should cover your deductible and this last point here is important insurance is not investing keep them separate This is an important point because a lot of times my whole life insurance they blend them together and you get neither the best of both worlds insurance is risk mitigation investing is getting a return on your capital to different goals different different methods to accomplish them keep them separate and you'll be better off just keep that thought in mind. So. About life insurance. One of the most common questions I get asked about is but do the words say Yes Alan I did say so let's take a look at that is that you. Well Or is that vital What does L.-Y. say about life insurance testimonies for the church Volume one bit five forty nine paragraph two and this is an entire chapter in testimonies Volume one I recommend you read it if you want more information which talks about life insurance. In a whole chapter she says I was shown the Sabbath keeping avenues should not engage in life insurance. This is a commerce with the world which God does not approve those who engage in this enterprise are uniting with the world while God calls us people to come out from among them and to be separate. Sounds pretty clear right so is. Is Oh my pro-life insurance or anti life insurance. Very clearly she is anti life insurance but the rest of the but the rest of the statement gives more insights I don't have the full quote Here she talks about how people try to get rich quick their haste to make money and these enterprises and. Things that are inventions that try to make a big return so somehow Back then she was talking about a life insurance where people are using it as an investment to make money so there's a there's a. There's a paper by George W. Reed called Seventh Day Adventists and life insurance it's available at that website it's the B R I website where the church actually did a study on life insurance elements Council historical context and all of that and this is what I find from that paper. The fledgling insurance industry was fully involved in the spirit of the time so this is the question why did Ellen White say what she said about life insurance what was the big problem with life insurance the fledgling insurance industry was fully involved in the spirit of the times the spear is steeped in the essence of high risk under-capitalized insurance stock routes all promising quick wealth frequent collapse without notice leaving their policies worthless company dealings with their customers giving off. Were unjust and not infrequently fraudulent in nature policies written on the lives of complete strangers were urged upon a public that was encouraged to invest in the hope of profiting in the death of the insured. There were other articles I've read and they basically said insurance companies back then were like Ponzi schemes there was no insurance involved people were just paying money and people were expecting a return but those companies just made off with their money and left there was no regulation and you can see it was written for life insurance with propose more as an investment get rich quick opportunity as opposed to protecting the income of the individual that the policy was written against That's historical context. So from the same paper this is what's recommended. Today's life insurance industry heavily regulated by law and government agencies differs in important ways from that fully eighteen hundreds and what's counsel against life investing in life insurance must be understood against the background of the practices of our times the meaning of the words is to be properly understood. So in other words we have to realize what was life insurance like back in her day versus what it's like today because using another analogy you remember Ellen White made statements about every woman should learn how to harness a horse. That's a true statement she said that. But does that mean every woman needs to literally learn how to harness a horse today and it would hurt be nice but is that really what she meant the principle of it looking at the historical context she's talking more about women should know how to handle the day to day rigors of transportation taking care of their modes of transportation getting places to be independent all that same with the Council on the bicycle craze in Battle Creek she has some strong statements against the bicycle craze it was unnecessary that bicycles were bad but in that particular historical context in Battle Creek there were issues that she was dealing with. We have to look at the historical context is what I'm illustrating So what happened to life insurance so how did a little research there's this article here called inch of the history of insurance in America found on Investopedia and they actually have more resources that I'm not including everything here but what happened after Ellen wides death that changed the landscape for life insurance in one thousand thirty five the Social Security Act came into effect providing unemployment compensation old age benefits. This took away some of the insurance companies territory and sent a clear signal to encourage industry to begin regulating itself for fear more government Volman there's about twenty years after his death life insurance in the life insurance industry began to change let's keep going World War two So now we're in the early forties brought a wage freeze and companies desperate to attract the workers still in the country started offering group life and health insurance these big policies went to large companies and that could handle them this well the big audience was starved out the little guys along with most of the fly by night rabble So those consolidation in the companies in the forty's and the little guys basically disappeared continuing. In one thousand nine hundred four the Supreme Court ruled that insurance that insurance should come under the federal regulation but Congress passed a Macand Ferguson Act in one thousand nine hundred five returning control to the state level and so since the mid forty's. Life insurance is now one of the most heavily regulated financial industries in the market it is night and day compared to when Ellen White was alive and talking about the subject so it would really be in can grew is to equal a life insurance or a day with life insurance today they're two different things different beasts if you will. And so we have to take the rest of our counsel into view we're going to get there in a moment it's a life insurance today so the bottom line is life insurance today is not the same as life insurance and an unwise day is just different animals. But going step further Ellen White strongly counsels for making provision to care for loved ones in case of emergency and life insurance is one effect a way to do that let me give you the quote. Advice on page three ninety six paragraph one the means you have earned has not been wisely and economically expended so as to leave a margin to be sick and your family deprived of the means you bring to sustain them so she specifically talking about you as a breadwinner probably talking to the husband or father of the home your family depends on your income so you need to have a way to provide for them should your income be removed from them or your family should have something to rely upon if you should be brought to strange places and guess what life insurance does it replaces the income of the person that's being insured that's the purpose OK So with these principles in mind we have to understand that and what counts is us to make provision for families the life insurance policies today are not what you talked about back then and that in a carefully crafted financial plan life insurance does and can have a place. So let's get a little bit more practical now so do I really need life insurance no not everyone needs life insurance life insurance what's the purpose the only it's only needed for those with the pendants and who do not have adequate access to care for them because life insurance is provided for the needs of the pendant in the vent of the breadwinner dies so. If you don't have any dependents. Why do you need life insurance it's no need or if you already have saved up and you have adequate assets and wealth that can take care of your family in the event that your income is taken away from them you don't need life insurance or even if you're married right you and your wife you don't have any kids your wife is well able to take care of yourself if you are to pass off the scene you don't need life insurance so the point here is life insurance is not something that everybody all. All over everyone all the time means it's something that is meeting a specific need and that is to replace the income of the breadwinner of the family and more specifically term life insurance is best for most people as opposed to whole life or cash value so what's the difference term life insurance is more basic life insurance is what you expect term meaning you only buy for a specific term twenty twenty five thirty years generally and you pay your monthly premium and during the time of this that the plan is in force and as long as you're paying your premiums should you die or whoever you buy the insurance policy on dies the face value of that policy gets given to the beneficiaries that's it you insure this person if they die the beneficiaries get the money simple whole life or cash value on the other hand it takes life insurance and investments and they meld them together and you build up a casual value and then you have a certain amount that's insurance or an amount that's investment and there are like a good zillion different flavors of this and you can never really figure out how much am I going to make and you have to pay in a sort of down time and then you know you don't get all the back until you like ten fifteen twenty years down the road there are tax around occasions so I'm not saying that cash value whole life never never never has a place but in most cases it's not a good idea for most people term life insurance it's simple to understand and a super cheap. So do I need it you can answer that question for yourself depending on your life situation. So how do you use term life insurance you purchase life term life insurance during the wealth building years when your kids have dependents at home so usually that's twenty to thirty years depending on how many kids you have how far apart you space them and so forth until they're grown and gone to college those usually are the prime years but if you have families with special needs maybe elderly parents infirmed special needs children or disabled family members that might. Change OK so the pending on your situation and during those years that you have Term life insurance you want to be saving and investing during those decades so that when the term policy ends you have accrued and invested enough assets so that you don't need the life insurance anymore so during the twenty or thirty years your kids are home growing up going to school you know you're working and if you were to die your family would be in dire straits OK you want life insurance to provide that risk protection but during that time you're saving into your retirement plan whatever and then by the time you hit I don't know fifty sixty whatever your kids are grown and gone there's only you and your wife at home you don't need to spend so much money you've saved up you've been investing like what we talked about earlier putting your money in interest and your nest egg has grown to a point where you don't need the life insurance anymore OK so get life insurance for the phase of life when you need it and then don't buy it when you don't need it OK that's the basic point so how much do I need simple ways to figure this based on your particular situation you want enough life insurance to cover the needs of the family until your dependents are independent so if you have young children like I do two years two years old. There's still a long time to raise this child whether it's my wife or whether it's legal guardians of both of us were to die we need to leave enough so that whatever a Christian education raising the child is taking care of so it's not a burden right time of being self-reliant not a burden on our families or whoever else ends up taking care of the child OK in addition to that we want to make sure that the insurance policy covers our major financial obligations debts future expenses like a mortgage or an education so we had a big mortgage and I die and my wife is all by herself that mortgage is going to be it just again to burden on her so you want life insurance to be able to cover those type of debts and maybe college for my child in the future so for a specific number roughly roughly twenty five percent of annual need is a rough mathematical calculation so if you need to replace approximately twenty thousand dollars of annual need you would take a five hundred thousand dollars policy that happens to be my policy I have fire thousand dollars half a million on me and it costs about thirty dollars a month so it's less than my car insurance to give you some comparison and if you're young and healthy rich following the health message certainly helps in that regard going up to a million dollar policy you're not adding that much more so we're not talking about huge sums of money to buy life insurance now why do I say twenty five percent is because of what's called the four percent safe withdrawal rule and this rule is from an academic study is called the Trinity Study nothing to do with the doctrine just I guess the school's name Trinity and they realize that for most conservative investment. Portfolios you can withdraw in where from three to four percent. With inflation calculated in and your nest egg will not run out within a typical thirty to forty year period and so that's why the four percent safe would drop rule is generally cited by experts as a safe amount that you can withdraw from your investments per year without destroying the principal before his time so that's the reason twenty five twenty five times and you'll need. Our. Health insurance. So some of us who are not from this country are probably going to glaze over at this part of the presentation wondering what's the big deal but hopefully the principles that we bring out may still be helpful. So. You know that getting sick in this country is costly business a little bit about my own experience with on just a moment but here's a statement against the messages Volume two page three thirty paragraph two diligence in business absence from pleasure even privation so long as help us out in danger should be cheerfully maintained by a young man in your circumstances and you have a little competency untouched should you become six specifically and why here is saying. You should mitigate the risk of sickness. So that the charities of others would not be your dependents. An emergency fund is nice but come on. Three to six months of living expenses is not going to go anywhere if you end up getting admitted to the hospital we all know that so why do we need the health insurance is to cover for high medical expenses that would wipe us out financially medical expenses is the number one reason for bankruptcy in the United States. Ten years ago exactly ten years ago at U.I.C. in Minnesota I was stricken with a severe illness some of you may remember the story I was V.P. of logistics with us at the time Wednesday morning before G. Y.C. I had a sudden stop is like a stroke and it wasn't a stroke but I was paralyzed from the neck down admitted to the hospital in Minnesota I was on a ventilator I.C.U. The Whole Nine Yards I was in the hospital for two weeks. Just in Minnesota before flying back to normal in the rehab for three months inpatient rehab outpatient rehab doctor visits you know you understand it keeps going you know how much it costs just the two weeks in Minnesota. And I want to take a guess. Half a million Well not quite. So five thousand two hundred thousand three hundred thousand dollars of that anyway. It was over ten thousand dollars a night. So for two weeks it was about one hundred sixty thousand dollars that's just for the first two weeks I was in rehab for another six months. You understand why medical expenses why people out in this country. But at the same time we have the council to not be dependent on the charities of others and to not be a burden on the church so what do we do that's where health insurance comes in if I did not have health insurance I was under my parents' policy at the time if I do not have health insurance and by the way I was of the mindset back in those days I'm young I'm vegetarian I'm healthy I don't need health insurance and if I did not have health insurance you know where I'd be still trying to pay off that debt or I would have to declare bankruptcy by now probably I don't know but I am no longer that naive young man that thought oh I don't need health insurance I need a health insurance and praise the Lord I had but that is still a pervasive way of thinking today so I want to deal with a few of these questions about health insurance that I think is common within our circles I live the Agnus health message or I'm young and strong or I work for God or I'm sacrificing for Him So God is my insurance so I don't need health insurance. The sad fact is we live in a sinful world and as a result of that we all have this time bomb that I keep talking about the strapped to our backs and it might go off at any moment and it might include accidents or illness even a few of the most faithful health reform we all know healthy you know godly people who died of cancer or some other health issue it's the result of a sinful world that we live in it's not the fault of God or those people and it can hit young or old I have a friend of mine killed in a car accident sixteen years old I mean it doesn't it doesn't matter who you are what skin color you are how old you are how young you are what you eat we live in a sinful world and that as a result we have risk and so we as careful stewards of the means that God has given us we need to be careful to think through how do we manage the risk here's a biblical principle we need to learn from the unjust stewards forethought and risk mitigation look sixteen human story the unjust do or it's just this is sort of a contradictory story right like he's defrauding his his master and his master commended him because he did wisely and Jesus is not saying we should the Prague anybody but Jesus said the children of this world are in their generation wiser than the children of light he even goes. So what is he saying he's saying we need to learn from the unjust steward who had the forethought to mitigate the risk when he's kicked out. But so many of God's people Jesus is saying we don't think about the future we just we make no plans we just leave it at that we just go on and then when disaster strikes what happens God's money has to flow out of God's work to take care of God's people when we don't make wise decisions in that way I believe Jesus is saying we need to be wiser than the children of this world so health insurance I think it is wise for us to have it but I really don't need it because I don't believe in conventional medicine and I only see treatment for alternative means that insurance won't cover. I am only going to do hydrotherapy. Well look I have nothing against natural remedies I believe in them and our lifestyle centers they're wonderful places to go but the reality is there are many acute and chronic conditions that may still require conventional intervention for example you get a car accident they're not going to give you a hydrotherapy treatment you're going to the E.R. if you have some sort of you know emergency that require surgery guess what it's going to cost a lot of money and those things can still bankrupt you but perhaps more importantly than that just because we are seeking alternative means of healing and when I say alternative means you realize that covers a lot of stuff and not everything that's alternative is automatically good you realize I'm not necessarily condoning or discouraging I'm just using this as a common phrase. But just because we seek alternative means of healing does that exempt us from the principle of self-reliance Does that somehow make us like more entitle to have other people help us is like oh I'm not going to see the doctor so that means I'm holier so you should give me your offering money so I can go do acupuncture or you know whatever it might be. The principle that I've been trying to really drill home in this seminar this particular hour. Is that God has given us the ability to be economical to be diligent to provide for our own needs as far as possible so that we are not a burden on the church on others and not to rely on the penance on others so if we believe in conventional or not using conventional means that means we in our own personal emergency fund our savings should build that build that in how much it's going to cost to go get these types of treatments we need to take responsibility to think through that instead of saying hey I don't want to go see the doctor so you have to pay for me that kind of thinking it doesn't doesn't fly because but what else. Yes. But I can't afford it now this one sort of legitimate is too expensive I can't cover the deductible or out of pocket expenses before my wife and I had our child we were in this boat Obamacare just come out the E.C.A. Affordable Care Act We made too much not enough dependents in our home astronomical premiums monthly premiums and our deductibles were like ten thousand dollars so we would be paying so much money month after month and the double double was so high that we would never use it it was it was just could not work. And there are a lot of people in this situation a lot of young people particularly your single if you're in a professional profession they make a lot of money. What do you do if you don't get it from work of course so here a couple options a couple things to consider first of all you want to see if you qualify for any subsidies so that's the Obamacare open enrollment period is over now and of course who knows what's going to happen next year I'm not going to get all political on you but things are going to change so don't know what's going to happen next year but you should at least look into it and also for many of us who have been working in supporting ministries with low incomes there are government programs that we do qualify for it's worth looking into and we need to look for at least catastrophic coverage so things are going to completely sink our financial ship we need to look into those and again the emergency fund is the critical piece here if we have a fully stocked him or emergency fund we can step up and get a higher insurance deductible and when you have a higher deductible you have lower premiums and if you have an emergency fund to cover for your higher deductible you're still covered so in my family now now that I have a third member of the home and we lost half of our income we qualify for Obamacare now and we have a very affordable health insurance plan Blue Cross to. In Tennessee and we have what's called a high deductible health care or health plan and what that does and gives us a very high deductible is like five six thousand dollars per person that's like twelve thousand dollars deductible for the family it's like really high but we saved up enough money to cover for that deductible and as a result of having an H.D. H.P. we qualify for what's called a health savings account and a health savings account as a it's like the most tax advantage investment account on the face of the plan the money goes in pretax it grows tax free and when you withdraw it for qualifying medical expenses there's no tax so is the only money that you can earn and place and invest and that has that's not taxed and that's what we have to say and so we invest in it and by the way once you hit sixty five say turns in sensually into an IRA so you can withdraw for your income and just pay income tax on it so you get the tax benefits of an IRA Plus the health insurance benefits and you get a higher amount of. That you can pay in year after year so this is what we do now high deductible health care plan it costs us almost nothing month a month and we save like crazy into our ages say we max it out every year for the tax benefits it's also our health care emergency fund and also if we don't use it in the future it becomes our retirement savings so that's an option if you qualify so what about the back back to the situation where we were in two years ago we did not qualify for any subsidies for Obamacare it was super expensive and we didn't make that much money but still didn't qualify so we at that time got what's called a Christian health care plan Medicare or a number care Medicare shares Ari is was a specific one that we used it was about a I think a five thousand dollars they call it an annual household portion which is the essentially the the doctor bill portion and we paid. One hundred eighty dollars a month or something like that for both of us and so these are it's not insurance but there are groups of Christian individuals who pooled their money together to essentially create their own form of insurance is serve the same purpose but they can't for legal reasons call it insurance they have different qualifications for admissions they don't they don't cover every single thing you know if you're an alcoholic they're not going to cover you for certain things if you get hit but if you're a drunk driver and you were at fault they're not going to cover some of those things because of their values and all that kind of stuff before Adventists. We will not only qualify but because we have the added lifestyle and the atmos health message if we are following it we can actually get a special discount if we are meeting certain you know health guidelines and that's what we had as another ten percent discount so. All I'm saying is this if we are going to take elements counsel seriously about being self-reliant and and providing for a selves in the case of health emergencies there are options I believe for most of us the vast majority of us those of us who are included in the typical G Y C demographic if we are willing to make the choice if we're willing to make the sacrifice but I think most of the time when we say but I can't afford it it's not that we can't afford it it's we say it's not a priority and the question is why isn't it OK So that's the question I'm going to leave with you as we hasten to a close here I'm over time but let me finish with this there's also go funny so another excuse is I'll just use crowdfunding to raise money when I have medical needs I don't know about you but recently every week just about there's another Go Fund Me campaign asking for medical expenses well research shows that over fifty percent or nearly fifty percent of all crowd funding now for medical expenses is the largest category of fund raising in crowd or particular for Go Fund Me But all the crowd funding platforms but if you're going to rely on Go Fund Me Remember this nine out of ten Medicare Medical campaigns do not get fully funded. You have a ninety percent chance of not really reaching what you need and crowd funding platforms keep a significant percentage of the funds they take a five percent fee plus the credit card transaction fees are sometimes as high as ten percent right off the top whether you meet your goals or not OK So who's getting rich is Go Fund Me. But there's more to this. Fund raising for our own needs should be the last resort not the first and this is really the bottom line of what we've been saying this whole session we need to be self-reliant as far as possible so we need to ask ourselves if we are tempted to just run to go from the oh I don't need health insurance I don't the emergency fund I'll just go ask for money and Go Fund Me if that's our attitude OK and I'm not saying that it is. Never legitimate to fundraise and I've myself have given it to multiple Go Fund Me campaigns for medical expenses we ask ourselves a couple questions number one am I comfortable releasing all this private information about myself online because in order for you to get to not be the nine ninety percent The failed to be the one percent that actually get fully funded you need to have a really compelling story. And to share a lot of transparency you have to give a lot of details about your real situation that's the reality you have to be able to market yourself and market your need on the crowdfunding platform and sense it's going online Are you comfortable essentially with that private information about yourself being online basically forever. Are you sure you want to do that that's a question to ask Number two have I done all in my power to meet this need myself Is it because of choices that I made. That I'm in the situation or is it a legitimate emergency that I've done all that I can but I just can't do anymore OK Ask yourself that question and find out what am I willing to sacrifice so to minimize my need of other people charity again this is the foundational question we need to be thinking what can I do to minimize the impact to God's work and his people OK And so. Here's that quote again selective messages Volume two page two thirty paragraph two this is sort of my health insurance quote if you will diligence in business abstinence from pleasure even privation so long as health is not in danger should be cheerfully maintained by a young man your circumstance and you would have a little competency untouched to become sick so little emergency fund three to six months and maybe a high deductible catastrophic health insurance policy or a medical health sharing plan in place right we should be willing to be diligent to be absent from pleasure even suffer a little. Vision sacrifice a little bit to place ourselves in that position why why so that the charities of others would not be our dependence that's the bottom line. So let's summarize risk and insurance why we talk about this hour we need to do all we can be self-reliant so to not the pen on the charity of others or to be a burden on the church we should strive to be the one rendering aid to other people rather than the one requiring it and to do that we should have a fully funded emergency fund and we should purchase reasonable insurance to cover for catastrophic risk and then to cooperate with God and following the laws of financial health to trust in him that he will provide for a lack when we've done our best but we're not going to do anything God. God looks at us and says I I've given you principles you're not doing anything you're not actually obeying the laws I've given you. So that brings us to the conclusion here of our second session I apologize for going over a little bit less about as for prayer as we conclude Father in heaven thank you so much for the clear counsel while some of this might have been a little bit challenging Lord help us to be willing to do our part to not be a burden upon your church or your work bless us the remainder of this G Y C and the rest of our seminar we pray in Jesus name. This message was recorded at the G Y C twenty seventeen conference arrives in Phoenix Arizona. G Y C S A pretty Ministry of the Seventh Day Adventist Church seeks to inspire young people to be bible beast Christ entered and so many Christians to download were purchased other resources like this visit us online at W.W.W. dot the Web dot org.

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