Sat with a young friend at lunch today. Beautiful wife, lovely child, but frustrated by work problems related to being in the family business which was then producing stress in his family.

While my friend lamented, I reminded him of the value of what he had sitting beside him, and of all God wanted for him if he’d surrender his life to Christ, and that the work issues, though legitimate, weren’t easily solvable and even solving them would be meaningless if he lost his marriage, or didn’t build his life on a firm spiritual foundation.

Suddenly, that song from Vacation Bible School came flooding back…the foolish man built his house upon the sand….the wise man built his house upon the rock….the rains came down, and the floods came up…the house on the rock stood firm. So, right there in the middle of Cheddars Scratch Kitchen I sat, the 55 year old grey haired old man, singing a song I’d learned over 50 years ago to my lunch companion as I urged him to build his house on a strong foundation of the Lord Jesus Christ.

All that theology. All that learning. All those books. All those classes. Probably 6000 sermons. And it all came down to a song taught to pre-schoolers.

It really is that simple.

What are you building your life on?

By: J. Barry Watts
Barry@JBarryWatts.com

My oldest daughter Madison just graduated from University and took her first professional position in the working world. A few days before she reported for work we sat down with her benefits package and talked about how she should handle her finances going forward. I’m sharing that conversation with you, in hopes that it might help you think about how to coach your own kids as the leave the nest and become employed, productive adults.

FIRST: I told Madison that first she should give 10% of her income away. My wife and I have the religious conviction that we should tithe (which means “tenth”) and we’ve taught that to our girls. But even if you don’t have any spiritual conviction behind your giving, it’s still a prudent way to live. Think about the crop farmer, who harvests corn in the Fall. When the harvest comes in he doesn’t sell all the harvest, or feed all of it to his cattle. He sets aside a part of it as “seed corn” to be planted next Spring so he’ll have a crop to harvest next Fall. This idea of setting some aside to replant is central to the cycle of sowing and reaping. If we expect to reap in life, it’s important that we sow. That’s why I told Madison to give 10% away.

SECOND: Commit to Save 20% for yourself, and live on 70%. If you don’t save, when you need to transition to a new job you won’t be able to, or when you want to retire, you won’t be able to. Saving is central to building a solid financial life.

THIRD: Of the 20% you save, put into your 401K the amount that your employer will match. In Madison’s case, that’s 6%. So for every dollar she puts in, the employer will put in a dollar, up to 6% of her salary. The 6% that Madison saves should go into the ROTH 401K, because all the data suggests that in the future, taxes will be much higher than they are today. Since a ROTH grows tax-free and distributes tax-free, paying the taxes today and saving the money where it will never be taxed again will pay off in spades when Madison goes to retire forty or fifty years from now.

FOURTH: Of the remainder that doesn’t get saved into the 401K—in Madison’s case 14%—I told her to begin sticking that money into a savings account until she has accumulated six months of income into this account. This isn’t savings to be used on a trip, or new furniture. Those things are additional. This money is being tucked away for an emergency, so when her transmission goes out, or she needs to replace an air conditioner, or has a health expense and needs to pay her deductible, or even if she should lose her job and have to transition to new employment, this six months worth of living expense will be there as an emergency fund.

FIFTH: When her emergency fund has accumulated six months worth of living expense, we’ll redirect this 14% into a different kind of savings. Not mutual funds, or stocks, but into an Indexed Universal Life Insurance program called a LIRP—a Life Insurance Retirement Program. This strategy will earn at a stock market rate of return when the economy is good, and that won’t lose money when the markets are bad. The return will just be 0%. It’ll be a fund that provides an amount roughly equal to the death benefit to cover long-term care or chronic illnesses if they ever occur. If she doesn’t need it for that, she can withdraw money from the account and spend it without ever paying taxes on it. Plus it provides a solid financial base to protect her family if she marries and has children. If misfortune strikes and she died, there would be a significant death benefit to provide financially for her children. Further, since these programs accumulate and distribute tax-free (like a ROTH IRA does), any money put into them is inoculated from future tax increases which are sure to come.

These LIRP programs are the cat’s meow of tax free saving for retirement. 85% of S&P 500 CEO’s have LIRPs, but most people have never heard of them.

If you aren’t familiar with these programs, reach out to me and I’ll send you a simple book you can read which will explain how they work, and why you should use them.

SIXTH: I told Madison that when she gets salary raises or bonuses, she needs to follow this rule: Save 50% and increase your lifestyle by 50%. That means a $10,000 raise allows you to increase your lifestyle by $5000, and increase your savings by $5000 per year.

If Madison will follow these six simple rules, she’ll be financially set.

How about you, what did you teach your kids about how to save and invest as they were leaving the nest? Leave your advice in the comments below.

By J. Barry Watts, Tax Strategist
www.SavingYouTaxes.com
Office@SavingYouTaxes.com

The Donald spoke at Liberty University today. In the brief video clip I saw it seemed to me he tipped his hand that the Bible was not a native or well-learned language to him. He said “Two Corinthians Three Seventeen.”

I could be wrong, but it seems to me that people who are familiar with the scripture would likely say “Second Corinthians…….”

And while we’re at it, his recent comments about not having anything to confess, and having not asked for forgiveness because he and God were good………..uhm………..those who know their way around the Bible wouldn’t be likely to make such claims.

When it comes to faith, I think Donald is an impostor.

I’ve been thinking about the “Pastor Industrial Complex.” That is, the system devised in American evangelical Christianity whereby we send our young ministers off to seminary for training, then hire them on to church jobs in the same way that business and industry hire talent.

It occurs to me this is wrong. Not wrong in the sense of sinful. But wrong in the sense of ineffective, and not Biblically normative.

In this model, pastors take jobs that are upwardly mobile. Who’d want to take a church in a declining or maintaining community when there are churches to be pastored in growing population centers? And then there is the issue of church hopping, moving to ever larger churches (with ever better compensation packages) while leaving the abandoned congregation to start over.

This model is very American. It’s just not very effective.

In Southern Baptist churches (with which I’m most familiar) the average tenure of a pastor is something like 2.5 years.

Really?

They say insanity is doing the same thing over and over again and expecting a different result. Hiring a new pastor every few years isn’t good for the congregation, doesn’t help the community, and is ineffective for propagation of the gospel.

Can I propose an alternative?

How about the “Indigenous Pastor Model?” That’s the way we do it on the mission field. Missionaries start works where none exist, with a goal to raise up leaders in that community or region who’ll then take over and be the pastors in that area. Come to think of it, that’s how the Apostle Paul did it. Paul and Barnabus “…appointed elders for them in every church…” (Acts 14:23) Who do you think they appointed? People from that congregation!

What could be more effective than home grown leaders; people who are from that community, committed to that community, who have nowhere to go, who aren’t looking to move up to a bigger denominational job or a bigger church with a higher profile? Wouldn’t it be better for the pastor to be someone who already knows the language and culture of a community, who already lives in that community, who is gifted, and called, and equipped and willing to invest their life in the people of the community where they already live. THAT is to me an exceedingly more effective model.

We’ve gotten smarter in many ways. There’s a big local food movement (know your farmer, know your food). Doesn’t it make sense to have a local ministry movement—-to know your pastor, who knows your flock?

Kelly and I were driving home from church today, separately from the girls, and talking about how proud we are of them. They make me want to bust my buttons regularly. (No surprise to you weary of my brags on social media. Imagine what its going to be like when I have grandkids!)

Isn’t it interesting how much we enjoy what we’ve produced. Kel and I really, really enjoy our children. We like looking at them. We like just being in the room where they are. We’re proud of them.

Similarly, Kelly enjoys her lawn and flowers. She mows, trims, grooms and nurtures about 4 acres every week, and when she’s done she sets back, sighs deeply, and inhales pleasure from what she’s done.

I enjoy growing vegetables in the garden. I get a kick out of sitting by the garden late in the day and enjoying the lush succulence of the vines loaded with produce. And, I enjoy a kitchen countertop loaded with tomatoes. They represent accomplishment or abundance of some sort to me.

Whether its kids, flowers, vegetables, a beautiful piece of art, or whatever your life’s production is, isn’t it interesting how much we enjoy what we’ve produced?

I deduce that God designed us to be productive and creative. When we create and produce, we’re like him. He produced the earth, the trees, the flowers, the animals, and man, and after every production He stepped back and said “it is good.” After man was created He actually said “It is very good!”

God enjoyed his production!

He then gave the first man, Adam, the job of tending the garden—-a responsibility that leads to productivity—-and commanded Adam and Eve to “be fruitful and multiply.” That’s certainly (re) productive.

So, here’s the big point: God made you and me to be like Him—productive—and when we are being productive we experience the pleasure that God experienced which caused him to say “it is good!”

There’s a time to produce, and a time to rest from producing; like God did. Great contentedness comes from being able to look at your children, your art, your flower bed, the book you’ve written, the shelves you organized, or whatever, and derive internal pleasure and deep satisfaction from what you’ve produced.

I’m grateful to be a producer. Grateful for the ability, and the opportunity, and the blessing of God on my efforts. And I’m deeply satisfied.

I wish for you my friend, the same sense of satisfaction.