WEBVTT 1 00:00:04.349 --> 00:00:08.099 Welcome to Financial Issues, where we help you steward faithfully 2 00:00:08.380 --> 00:00:11.939 by honoring God with your investments. Now listen in as 3 00:00:11.980 --> 00:00:14.769 we give you the practical tools and advice you need 4 00:00:15.109 --> 00:00:17.530 to become a biblically responsible investor. 5 00:00:22.769 --> 00:00:26.109 This is Financial Issues, where we help you defund darkness 6 00:00:26.170 --> 00:00:29.190 and fund the light by investing with biblical integrity. 7 00:00:29.230 --> 00:00:30.489 Welcome to today's show, folks. 8 00:00:30.589 --> 00:00:34.049 On the show, one asset that every investor has to 9 00:00:34.109 --> 00:00:35.950 reckon with at some point is what we might consider 10 00:00:35.979 --> 00:00:36.719 the home base. 11 00:00:36.759 --> 00:00:37.530 That's cash. 12 00:00:37.979 --> 00:00:40.159 We'll discuss this in just a moment. Looking forward to it, folks. 13 00:00:40.179 --> 00:00:42.159 Seth Udinski here with you, Sam Case in the control room, 14 00:00:42.420 --> 00:00:43.420 and your host, Mark Manilla. 15 00:00:43.460 --> 00:00:44.259 Mark, good morning, brother. 16 00:00:44.780 --> 00:00:46.799 Good morning, Seth. Good to be here this morning. 17 00:00:47.020 --> 00:00:47.500 It sure is. 18 00:00:47.539 --> 00:00:51.299 Think about that. Today is Thursday. It was Monday yesterday. 19 00:00:51.579 --> 00:00:52.159 Isn't that weird? 20 00:00:52.179 --> 00:00:52.780 It's crazy. 21 00:00:53.000 --> 00:00:53.219 I know. 22 00:00:53.359 --> 00:00:55.729 Is that how that works? 23 00:00:55.829 --> 00:00:58.750 And tomorrow is Focus Friday in overtime. 24 00:00:58.810 --> 00:00:59.969 Can't wait for that. It's going to be fun. 25 00:01:00.009 --> 00:01:02.509 Hope you folks will be gearing up for that. Just 26 00:01:02.549 --> 00:01:04.030 a reminder, by the way, the best place to watch 27 00:01:04.069 --> 00:01:08.269 the show is financialissues.org. That's where you get overtime, but 28 00:01:08.290 --> 00:01:11.189 you also get the full live show one hour every day, 29 00:01:11.209 --> 00:01:12.750 and you get to join our folks in the chat. 30 00:01:12.810 --> 00:01:14.879 They're already popping this morning. Good to see you all. 31 00:01:15.159 --> 00:01:17.079 And, hey, join us on the phones right now as well, 32 00:01:17.090 --> 00:01:22.519 by the way, 610-363-1110. Again, 610-363-1110. Guys, let's jump right 33 00:01:22.540 --> 00:01:26.280 into our topic of the day, cash as an asset class. So, Mark, 34 00:01:26.400 --> 00:01:30.480 how should FISM partners think about cash? Should we categorize 35 00:01:30.519 --> 00:01:34.019 it as an asset class? as we might uh you 36 00:01:34.040 --> 00:01:36.420 know technology or some other sectors or should we think 37 00:01:36.439 --> 00:01:38.799 of it as something else entirely and by the way 38 00:01:38.859 --> 00:01:41.590 folks just so just to clarify we're not talking about 39 00:01:41.689 --> 00:01:44.569 physical cash that you're holding on hand necessarily this would 40 00:01:44.590 --> 00:01:46.670 be the cash in your brokerage account or something else. 41 00:01:46.569 --> 00:01:49.549 Like that so not the change in your pocket exactly 42 00:01:49.569 --> 00:01:53.370 yeah yeah yeah no i absolutely cash is an asset 43 00:01:53.450 --> 00:01:57.230 class and it's more of a defensive class but it's 44 00:01:57.299 --> 00:02:02.450 not like uh equities where you're primarily thinking about return 45 00:02:02.510 --> 00:02:06.390 producing investment. Cash is a place as an asset class 46 00:02:06.450 --> 00:02:13.800 for defensive use and or preparation use. So think of 47 00:02:13.879 --> 00:02:16.340 it as a strategic asset. I guess that's the way 48 00:02:16.520 --> 00:02:19.479 I would look at it. Mark, before we get into. 49 00:02:19.280 --> 00:02:22.319 This, could you talk about what is an asset class? 50 00:02:22.400 --> 00:02:24.180 What are we talking about specifically? 51 00:02:25.250 --> 00:02:30.650 Well, asset classes are different products that have very similar 52 00:02:30.830 --> 00:02:36.530 characteristics for example stocks stocks have similar characteristics different by 53 00:02:36.550 --> 00:02:39.719 your different stocks they they have growth potential they could 54 00:02:39.750 --> 00:02:44.639 have a little income potential with dividends they have shared 55 00:02:44.780 --> 00:02:47.120 risk you know they have market risk they have economic 56 00:02:47.199 --> 00:02:50.719 risk they have internal risk so that's a class in 57 00:02:50.780 --> 00:02:53.659 and of itself real estate could be another one real 58 00:02:53.699 --> 00:02:57.819 estate has different uh characteristics than their stock does it's 59 00:02:57.960 --> 00:03:02.949 usually not as of a flyer as stocks can be 60 00:03:03.330 --> 00:03:05.509 as far as growth, but it does have growth potential, 61 00:03:05.789 --> 00:03:09.639 but it has risk. If it's rental property, then you 62 00:03:09.699 --> 00:03:14.300 also have income ability, but you have the risk special 63 00:03:14.379 --> 00:03:17.569 risk that bonds don't have so and then bonds would 64 00:03:17.590 --> 00:03:20.689 be another asset class and they have their own characteristics 65 00:03:20.770 --> 00:03:24.990 where it's a contractual lending process so an asset class 66 00:03:25.210 --> 00:03:30.419 is just similar products that have similar characteristics so you 67 00:03:30.460 --> 00:03:35.139 have stocks bonds you have real estate you have different 68 00:03:35.219 --> 00:03:40.689 things like that equities fixed income commodities They all are 69 00:03:40.729 --> 00:03:43.150 different asset classes, and cash is one of those. 70 00:03:43.169 --> 00:03:43.590 Makes sense. 71 00:03:44.169 --> 00:03:44.430 Yeah. 72 00:03:44.750 --> 00:03:46.289 So, you know, cash is there. 73 00:03:46.310 --> 00:03:51.750 The qualities of cash, the characteristics is it provides liquidity. 74 00:03:51.870 --> 00:03:54.789 Money is ready and available when you need it, and 75 00:03:54.810 --> 00:03:59.770 it reduces portfolio risk. So as we diversify our portfolio, 76 00:04:00.069 --> 00:04:03.400 there's times in the market, there's times in the economy 77 00:04:03.500 --> 00:04:05.819 and the market where you may want to be more 78 00:04:05.860 --> 00:04:07.319 defensive and protective. 79 00:04:07.620 --> 00:04:08.840 Well, you move to cash. 80 00:04:09.379 --> 00:04:15.099 It also provides opportunity capital, meaning you might as you're 81 00:04:15.139 --> 00:04:18.009 pruning back your winners, you might want to just go 82 00:04:18.050 --> 00:04:22.670 to cash. So it's instantly available when that next opportunity 83 00:04:22.750 --> 00:04:26.939 comes by. So and it also prevents for selling, for example. 84 00:04:27.500 --> 00:04:30.829 For some elderly people who are in retirement and they 85 00:04:30.870 --> 00:04:36.550 need regular income, if you are still convinced and comfortable 86 00:04:36.629 --> 00:04:41.129 with leaning higher towards growth, you may want to have 87 00:04:41.189 --> 00:04:47.120 a larger cash asset allocation so that for two, three months, 88 00:04:47.339 --> 00:04:49.279 if the markets are having a rough time, you don't 89 00:04:49.319 --> 00:04:52.399 have to sell something off at that point, but you 90 00:04:52.439 --> 00:04:54.639 have a cash buffer to continue your income. 91 00:04:54.730 --> 00:04:57.540 So cash can be a very strategic position. 92 00:04:58.339 --> 00:05:01.439 Now, Mark, how might we go about this maybe differently 93 00:05:01.680 --> 00:05:04.100 if we choose to keep our cash portion of the 94 00:05:04.139 --> 00:05:07.699 investments in a money market type that might make 3% 95 00:05:07.699 --> 00:05:10.160 or so sitting there, or if it's just in like 96 00:05:10.199 --> 00:05:13.360 a really low yield savings type account, depending on what's 97 00:05:13.379 --> 00:05:16.689 available to us at our brokerage, should we approach that 98 00:05:16.810 --> 00:05:18.750 differently if we're making a little more on it? 99 00:05:19.110 --> 00:05:20.529 Or is it really kind of the same approach? 100 00:05:21.430 --> 00:05:23.629 It's the same approach. It's just more intelligent. 101 00:05:25.250 --> 00:05:27.250 I mean, if cash is going to be part of 102 00:05:27.269 --> 00:05:29.970 the portfolio anyway, you want it to be as productive 103 00:05:30.009 --> 00:05:33.529 as possible without incurring any more risk. I mean, it 104 00:05:33.689 --> 00:05:38.199 just makes sense. Make idle cash productive. You know, a 105 00:05:38.259 --> 00:05:43.079 competitive money market gives you the same liquidity that having 106 00:05:43.160 --> 00:05:46.800 cash in a checking or saving account does. It provides 107 00:05:47.339 --> 00:05:50.839 stability and then generates some income while you're waiting. So 108 00:05:52.449 --> 00:05:55.029 you don't have to chase yields. So the objective of 109 00:05:55.069 --> 00:06:02.670 cash allocation is still liquidity. It's capital preservation and availability. So, 110 00:06:02.949 --> 00:06:05.910 you know, you don't worry about it, but if you 111 00:06:05.970 --> 00:06:12.170 have your cash account at your brokerage, that's paying 0.00001%. 112 00:06:12.170 --> 00:06:14.290 And you have the option of a money market that's 113 00:06:14.329 --> 00:06:18.310 paying 3%. Well, this is a duh moment. Just move 114 00:06:18.360 --> 00:06:20.800 to the, Money, Mark, make sure your cash moves to 115 00:06:20.819 --> 00:06:23.379 the money market that's paying 3%. 116 00:06:23.379 --> 00:06:23.860 Absolutely. 117 00:06:24.399 --> 00:06:29.829 Mark, where's the line? Do CDs count as cash, fixed income? 118 00:06:30.189 --> 00:06:31.629 Where do we draw the line? 119 00:06:31.649 --> 00:06:32.089 No, they don't. 120 00:06:32.110 --> 00:06:32.949 This is no longer cash. 121 00:06:33.069 --> 00:06:33.250 Okay. 122 00:06:33.290 --> 00:06:33.730 No, no. 123 00:06:34.800 --> 00:06:37.949 CDs don't because they have a lockup period and there's 124 00:06:38.029 --> 00:06:41.470 penalties for pulling the money out. You, you've erased some 125 00:06:41.509 --> 00:06:46.089 of the strategic ability of, of the cash asset there by, 126 00:06:46.430 --> 00:06:48.740 by locking it in. You know, if you put in 127 00:06:48.810 --> 00:06:51.300 a CD, yes, you can get to it, but you're 128 00:06:51.379 --> 00:06:56.029 losing any interest. And some banks have some penalties against it. 129 00:06:56.079 --> 00:06:57.839 If you, if you go in and you take it 130 00:06:57.920 --> 00:07:00.459 out within a certain amount of time, they'll actually charge 131 00:07:00.500 --> 00:07:03.610 you above and beyond any interest you, earned. 132 00:07:03.750 --> 00:07:06.899 So you got to be careful about that. Fixed income. 133 00:07:07.259 --> 00:07:12.939 Well, you've just introduced some risk into your asset that 134 00:07:13.000 --> 00:07:14.500 was not there with cash. 135 00:07:14.800 --> 00:07:18.519 Bonds do go up and down in prices. Yields do change. 136 00:07:19.449 --> 00:07:23.149 Companies, if it's corporate yields, if it's corporate bonds, you 137 00:07:23.189 --> 00:07:26.589 could lose all your money if they default or go bankrupt. 138 00:07:26.670 --> 00:07:30.120 So it's a different asset class when you go into 139 00:07:30.160 --> 00:07:34.769 bonds and CDs, although CDs are very close to cash. 140 00:07:36.129 --> 00:07:38.430 And I think that you could find CDs that all 141 00:07:38.449 --> 00:07:40.629 they do is beat you up on taking away your 142 00:07:40.689 --> 00:07:44.079 last quarter of, of interest that you earned. 143 00:07:44.199 --> 00:07:46.620 So you're not going to lose a lot, but I 144 00:07:46.699 --> 00:07:47.319 found that. 145 00:07:47.180 --> 00:07:50.360 It's easier to be in a money market on most 146 00:07:50.420 --> 00:07:55.620 brokerage platforms because you can set your money market up as, as, 147 00:07:56.899 --> 00:08:00.029 automatic so that any cash that's in your account gets 148 00:08:00.230 --> 00:08:03.910 automatically moved to your money market account. And then when 149 00:08:03.930 --> 00:08:07.399 you buy things, let's say you find an opportunity and 150 00:08:07.420 --> 00:08:09.759 you go and you buy 100 shares of the stock, 151 00:08:10.660 --> 00:08:13.100 the money is there for it and you don't have 152 00:08:13.120 --> 00:08:14.939 to transfer it back and forth. 153 00:08:16.250 --> 00:08:20.040 Absolutely. Now, Mark, here's a maybe a strategy question for us. 154 00:08:20.420 --> 00:08:22.180 You know, sleep factor, I think, is one of the 155 00:08:22.220 --> 00:08:24.379 big considerations when we think about how much cash we 156 00:08:24.399 --> 00:08:26.680 should have at one given time. But is there anything 157 00:08:26.720 --> 00:08:29.600 else that we should consider as we determine, OK, this 158 00:08:29.660 --> 00:08:31.759 is a time of volatility? Maybe I feel a little 159 00:08:31.800 --> 00:08:33.320 more nervous, so I'm going to go a little heavier 160 00:08:33.360 --> 00:08:35.600 in cash. What should we consider as we make the 161 00:08:35.639 --> 00:08:37.759 decision of how heavy we are in cash at one time? 162 00:08:40.299 --> 00:08:41.639 Well, I think it's. 163 00:08:41.519 --> 00:08:45.230 Really important that we realize that this is a strategy. 164 00:08:45.269 --> 00:08:47.870 We're not moving out of fear. We're stewards. 165 00:08:48.309 --> 00:08:52.509 We're not just investors. We're godly stewards. And this is 166 00:08:52.570 --> 00:08:56.210 investment stewardship. So we don't move from fear. We don't 167 00:08:56.289 --> 00:09:00.470 move from greed. We move from strategy. And that strategy 168 00:09:00.549 --> 00:09:03.950 is to honor God with all we have, including our investments. 169 00:09:04.070 --> 00:09:07.220 So when we move to cash, it's a strategic movement. 170 00:09:07.740 --> 00:09:09.960 I think I saw a couple people in the chat 171 00:09:10.000 --> 00:09:12.980 already talking about how they're looking at this election time 172 00:09:13.059 --> 00:09:16.519 as maybe this is a time to start increasing their 173 00:09:16.679 --> 00:09:18.139 asset allocation to cash. 174 00:09:18.220 --> 00:09:19.080 Well, absolutely. 175 00:09:20.059 --> 00:09:22.970 Any economic struggles that could cause the markets to be 176 00:09:23.009 --> 00:09:25.090 pulling back, and we're starting to see some of that 177 00:09:25.169 --> 00:09:30.750 right now where money is moving quickly out of technology, 178 00:09:31.450 --> 00:09:34.490 not causing it to crash. Well, some of the stocks 179 00:09:34.529 --> 00:09:36.870 are taking a real beating right even though they're good, 180 00:09:36.899 --> 00:09:41.789 strong stocks. But if you had been with us at 181 00:09:41.809 --> 00:09:43.629 the beginning of the year and you listen, and we 182 00:09:43.669 --> 00:09:47.889 kept saying, prune those back, lock in those gains that 183 00:09:47.929 --> 00:09:49.190 you're getting in this area. 184 00:09:49.690 --> 00:09:51.610 If you had done that, you may have a little 185 00:09:51.690 --> 00:09:52.309 extra cash. 186 00:09:52.389 --> 00:09:55.809 Well, we have some economic situations that can affect the markets, 187 00:09:56.269 --> 00:10:00.539 including the bond markets, as we're seeing. Iran and election 188 00:10:00.600 --> 00:10:02.879 period and it wouldn't hurt to have a little extra 189 00:10:02.919 --> 00:10:07.200 cash so after the election after with these opportunities pop 190 00:10:07.299 --> 00:10:12.460 up when the conservative fiscally responsible people get into congress 191 00:10:12.759 --> 00:10:17.149 get into the senate get in the house and the 192 00:10:17.210 --> 00:10:21.480 United States lights up with glee, we can get involved 193 00:10:21.519 --> 00:10:24.820 with it. You might have a difference of opinion on that, though. 194 00:10:25.139 --> 00:10:31.279 The number here is 610-363-1110, 610-363-1110. I'd love to hear 195 00:10:31.320 --> 00:10:34.379 your opinion about cash and how to use it and 196 00:10:34.440 --> 00:10:35.299 how you use it. 197 00:10:35.580 --> 00:11:09.539 Don't be shy about calling in. Join us, 610-363-1110. Great 198 00:11:09.580 --> 00:11:12.200 to have you today, folks. 199 00:11:12.220 --> 00:11:12.299 610-363-1110. 200 00:11:12.340 --> 00:11:14.019 Hey, real quickly, before we get back to this conversation 201 00:11:14.059 --> 00:11:16.440 on cash, let me just tell you about Samaritan Ministries, 202 00:11:16.480 --> 00:11:20.419 our sponsor for the day. Wonderful health-sharing group, Christian organization. 203 00:11:21.110 --> 00:11:22.610 If you are looking to get off the rat race 204 00:11:22.649 --> 00:11:27.129 of big healthcare, Samaritan Ministries is the place for you. Samaritanministries.org, 205 00:11:27.210 --> 00:11:30.210 great place to check out for you and your family, perhaps, 206 00:11:30.269 --> 00:11:33.610 for good health sharing. Sam, I know our chat is 207 00:11:33.809 --> 00:11:36.129 popping this morning, and we got some good comments in there. 208 00:11:37.029 --> 00:11:37.649 About this. 209 00:11:37.669 --> 00:11:40.029 They sure are. You know, Mark was talking in the 210 00:11:40.070 --> 00:11:42.629 last segment about how this isn't a fear based thing, 211 00:11:42.700 --> 00:11:45.600 storing up cash as an asset. It's just a strategy. 212 00:11:46.139 --> 00:11:48.080 And frankly, Mark, I think the people in the chat 213 00:11:48.159 --> 00:11:50.600 are way ahead of you. They're already doing this. George 214 00:11:50.620 --> 00:11:52.960 from North Carolina says, I'm glad to hear this, Mark. 215 00:11:53.279 --> 00:11:55.120 I have too much sitting on the sidelines right now, 216 00:11:55.179 --> 00:11:58.220 but I just don't see many stocks that suit my fancy. 217 00:11:58.320 --> 00:11:59.899 So he's right on target. 218 00:11:59.919 --> 00:12:00.860 Absolutely. 219 00:12:00.879 --> 00:12:01.399 Absolutely. 220 00:12:02.000 --> 00:12:04.440 Yeah, it's hard to find good stocks when we've had 221 00:12:04.480 --> 00:12:07.159 an overvalued market now for quite a long time, even 222 00:12:07.200 --> 00:12:12.820 on the pullbacks. When you have stocks pulling back 10% 223 00:12:12.860 --> 00:12:16.379 and they're still way overvalued, there's an issue in the market. 224 00:12:16.470 --> 00:12:18.850 So we have to be careful, and this is where 225 00:12:18.889 --> 00:12:19.580 cash comes in. 226 00:12:19.610 --> 00:12:22.549 It allows us to earn a little bit while we're 227 00:12:22.570 --> 00:12:26.490 sitting there waiting for those opportunities of a financial issue 228 00:12:26.590 --> 00:12:28.029 steel-type product. 229 00:12:28.980 --> 00:12:31.500 That's awesome. Mark, here's a question for you. 230 00:12:32.059 --> 00:12:35.509 How do we avoid the temptation to be like the wicked, 231 00:12:35.570 --> 00:12:38.830 lazy servant from Matthew 25 who buried his master's money 232 00:12:39.210 --> 00:12:42.250 when it comes to cash accumulation? Because I could even see, okay, 233 00:12:42.269 --> 00:12:44.860 maybe there's a question here of, well, if I'm accumulating cash, 234 00:12:45.220 --> 00:12:47.720 you know, say before an election, am I being like 235 00:12:47.779 --> 00:12:49.600 the wicked, lazy servant? Or is there a way to 236 00:12:49.639 --> 00:12:51.600 do that wisely where we're not doing it out of 237 00:12:51.639 --> 00:12:52.279 greed or fear? 238 00:12:53.000 --> 00:12:56.549 Yeah, I don't believe Matthew 25 teaches that holding cash 239 00:12:56.629 --> 00:12:58.610 is wrong. I don't think that's what it's saying. The 240 00:12:58.649 --> 00:13:02.139 wicked servant, he had a problem, and it wasn't simply 241 00:13:02.179 --> 00:13:07.490 that the money was invested wasn't invested aggressively his problem 242 00:13:07.529 --> 00:13:11.289 was that fear this is a key that fear caused 243 00:13:11.330 --> 00:13:15.129 him to do nothing with what he was entrusted with 244 00:13:15.190 --> 00:13:15.690 so it. 245 00:13:15.629 --> 00:13:19.320 Wasn't momentary fear it consumed his whole mindset yeah you 246 00:13:19.360 --> 00:13:22.139 know it's not like he made a a momentary mistake 247 00:13:22.220 --> 00:13:23.980 it's his whole life was fear. 248 00:13:24.440 --> 00:13:28.120 Right there can be really legitimate reasons for holding cash 249 00:13:28.590 --> 00:13:33.490 strategic reasons cash can can reduce risk, it can preserve capital, 250 00:13:33.509 --> 00:13:37.070 it can do many different things. But just putting stuff 251 00:13:37.110 --> 00:13:38.970 into cash because you don't want to have to make 252 00:13:39.009 --> 00:13:44.590 a decision because you're afraid to make a decision, that's 253 00:13:44.909 --> 00:13:49.440 just being unwilling to work or refusing to put God's 254 00:13:49.980 --> 00:13:54.500 resources to a productive end. I really think that a 255 00:13:54.580 --> 00:13:58.019 faithful steward asks, why am I holding it? And what's 256 00:13:58.059 --> 00:14:02.639 the purpose of of holding it in cash so that 257 00:14:03.340 --> 00:14:05.500 that's a big different thing I really think we need 258 00:14:05.539 --> 00:14:08.590 to look at stewards don't manage from fear they manage 259 00:14:08.649 --> 00:14:12.629 from purpose big difference you know fear is the definition 260 00:14:12.649 --> 00:14:15.409 of fear is lack of trust in God that is 261 00:14:15.500 --> 00:14:18.679 my definition of fear when we have fear if our 262 00:14:18.720 --> 00:14:21.419 God is a God of the Bible, the one that 263 00:14:21.500 --> 00:14:24.399 says that, that he will care for us, that. 264 00:14:24.279 --> 00:14:25.110 He will protect us. 265 00:14:25.139 --> 00:14:28.779 He'll give us everything we need to overcome the trials 266 00:14:28.850 --> 00:14:32.509 and the tribulations in our life or, or to endure them. 267 00:14:33.070 --> 00:14:36.350 You know, then we have to believe that if we don't, 268 00:14:36.649 --> 00:14:39.850 then we have fear in our life and we don't move. 269 00:14:40.350 --> 00:14:42.490 A good steward doesn't move for fear. 270 00:14:43.029 --> 00:14:45.409 And I also would like to say something that probably 271 00:14:45.450 --> 00:14:46.669 a lot of people don't want to hear. 272 00:14:46.870 --> 00:14:51.139 Um, Patience, being patient in the market isn't laziness. I mean, 273 00:14:51.179 --> 00:14:51.720 it can be. 274 00:14:51.779 --> 00:14:55.019 People can be lazy in their portfolio. But in general, 275 00:14:55.759 --> 00:14:58.600 good patience means you're waiting for the right time and 276 00:14:58.639 --> 00:15:02.899 the right product before you just jump in. People who 277 00:15:02.919 --> 00:15:06.539 knee-jerk react in the market are usually ones who lose 278 00:15:06.590 --> 00:15:07.129 the most. 279 00:15:07.000 --> 00:15:07.899 Money in the market. 280 00:15:08.120 --> 00:15:13.529 So, you know, the bottom line is faithfully use what 281 00:15:13.570 --> 00:15:17.490 the master has entrusted to you. The danger isn't cash 282 00:15:17.649 --> 00:15:20.769 sitting still for a little bit. The danger is a 283 00:15:20.830 --> 00:15:23.659 steward who stopped stewarding what was entrusted to him. 284 00:15:23.669 --> 00:15:24.570 The danger is you. 285 00:15:25.350 --> 00:15:26.789 Yeah, the danger is you. 286 00:15:28.529 --> 00:15:30.450 That makes sense. 287 00:15:30.470 --> 00:15:30.529 610-363-1110. 288 00:15:30.549 --> 00:15:32.210 Last question here, Mark. A couple of folks in our 289 00:15:32.269 --> 00:15:34.480 chat are wondering, not the last question of the show, 290 00:15:34.509 --> 00:15:35.080 by the way, folks. 291 00:15:35.409 --> 00:15:37.659 But the last question of this conversation. 292 00:15:38.519 --> 00:15:41.080 A couple of folks, Mark, are wondering, are money market funds, 293 00:15:41.139 --> 00:15:43.740 which we were talking about cash, cash equivalents, are they 294 00:15:43.980 --> 00:15:45.360 FDIC insured, Mark? 295 00:15:46.779 --> 00:15:51.320 If they're through most money market funds are FDIC insured, 296 00:15:52.139 --> 00:15:54.980 even some of them at the brokerages, because the brokerages 297 00:15:55.019 --> 00:15:58.909 will use banks for their money market accounts. So, yeah, 298 00:15:58.950 --> 00:16:03.649 they can be both SPIC and FDIC. SPIC is the 299 00:16:03.850 --> 00:16:06.769 insurance you get at your brokerage to protect against fraud 300 00:16:06.830 --> 00:16:09.450 and collapse and things like that. FDIC is what you 301 00:16:09.470 --> 00:16:11.269 get at your bank to protect you. 302 00:16:12.379 --> 00:16:12.620 Awesome. 303 00:16:12.899 --> 00:16:13.960 Great stuff. Thank you, Mark. 304 00:16:14.299 --> 00:16:17.340 Folks, give us a call at the number 610-363-1110. Mark, 305 00:16:17.379 --> 00:16:20.720 here's a good question switching topics. So Marshall is 62 306 00:16:20.720 --> 00:16:23.820 years old. He's saying, I'm debt-free. I got an emergency 307 00:16:23.879 --> 00:16:26.240 fund plus savings. My wife and I have extra money 308 00:16:26.259 --> 00:16:26.779 to invest. 309 00:16:26.799 --> 00:16:28.139 That's awesome, Marshall. Great job. 310 00:16:28.539 --> 00:16:31.919 He says, can you explain, Mark, why ETFs and mutual 311 00:16:31.960 --> 00:16:36.820 funds are more hands-off than a regular investment account? Because 312 00:16:36.860 --> 00:16:40.480 of my schedule, my time's limited, and I'm leaning toward... 313 00:16:40.850 --> 00:16:44.529 more of the fund asset allocation. And if I adopt that, 314 00:16:44.669 --> 00:16:47.870 what's the difference between buying the funds, say, through a 315 00:16:47.929 --> 00:16:50.990 Timothy plan or buying them directly through Fidelity? 316 00:16:51.009 --> 00:16:52.789 So there's a couple layers to that there, Mark. 317 00:16:53.509 --> 00:16:53.830 Yeah. 318 00:16:54.269 --> 00:16:56.740 Well, Marshall, I think you're thinking the right way. The 319 00:16:56.779 --> 00:17:01.139 first distinction I'd like to make is that an ETF 320 00:17:01.220 --> 00:17:05.240 or mutual fund isn't really an alternative to an investment account. 321 00:17:05.720 --> 00:17:08.440 They are a product. They're a different type of product 322 00:17:08.480 --> 00:17:11.950 than an individual stock. It's an investment that you hold 323 00:17:12.109 --> 00:17:17.009 inside your account, okay? So, ATF, a stock, a bond, 324 00:17:17.349 --> 00:17:21.839 different types of products, a mutual fund, different types of product. 325 00:17:22.200 --> 00:17:26.240 What makes it more hands-off is that owning individual stocks 326 00:17:26.380 --> 00:17:30.089 is that you're buying a When you buy an individual stock, 327 00:17:30.269 --> 00:17:32.740 generally you have to do the research or you get 328 00:17:32.779 --> 00:17:35.740 the information from some place like Financial Issues who does 329 00:17:35.759 --> 00:17:38.200 the research for you. But you still have to decide, 330 00:17:38.539 --> 00:17:41.619 is this something that I agree with? Is this something 331 00:17:41.660 --> 00:17:44.730 that I trust? Is this something I'm comfortable with? When 332 00:17:44.769 --> 00:17:47.890 you go to an ETF or a mutual fund, oftentimes 333 00:17:48.089 --> 00:17:51.650 they're either index ETFs. There's a lot of index ETFs, 334 00:17:51.670 --> 00:17:55.019 which means they're not really managed. They just follow an 335 00:17:55.079 --> 00:17:58.380 index like the S & P 500 or the Dow, 336 00:17:58.460 --> 00:17:59.299 something like that. 337 00:18:00.279 --> 00:18:03.500 Or they are managed. And a lot of them, I. 338 00:18:03.460 --> 00:18:05.670 Would say the majority of mutual funds out there are 339 00:18:05.730 --> 00:18:08.509 managed by either a single person or a group of people. 340 00:18:08.839 --> 00:18:12.000 who take all the money people put into this mutual fund, 341 00:18:12.319 --> 00:18:14.769 and then they take it and they go buy many, 342 00:18:14.829 --> 00:18:18.730 many different stocks, bonds, or different assets, depending on the 343 00:18:18.769 --> 00:18:23.130 prospectus of that mutual fund or that ETF. So effectively, 344 00:18:23.190 --> 00:18:25.089 it helps you not have to dig in and do 345 00:18:25.210 --> 00:18:28.319 all the work. You just find the mutual fund that 346 00:18:28.390 --> 00:18:31.279 fits what you're trying to do. Now, Timothy Plan is 347 00:18:31.339 --> 00:18:34.799 a company that creates these kind of products, ETFs and 348 00:18:34.859 --> 00:18:37.660 mutual funds, for those people who don't want to have 349 00:18:37.700 --> 00:18:40.930 to manage them pick the individual stocks themselves. 350 00:18:41.250 --> 00:18:43.190 And they do it in a way that makes it simple. 351 00:18:43.529 --> 00:18:46.869 So you can buy Timothy plan ETFs or mutual funds 352 00:18:47.190 --> 00:18:49.910 through a brokerage account or direct at the fund, like 353 00:18:49.930 --> 00:18:53.319 you were talking about. And there's really no different there 354 00:18:53.380 --> 00:18:57.640 unless the, the brokerage account you're using charges you for 355 00:18:57.660 --> 00:19:01.059 the buy and sell of, of, of them, which the 356 00:19:01.099 --> 00:19:04.420 Timothy plan won't because the same internal expenses will be 357 00:19:04.460 --> 00:19:08.769 at both places. The, the brokerages are just a distributor 358 00:19:08.930 --> 00:19:12.329 of those products like they are individual stocks and whatnot. 359 00:19:12.529 --> 00:19:16.130 So Marshall, if you don't have the time to be 360 00:19:16.190 --> 00:19:18.910 doing it all, then you could even, Timothy Plant even 361 00:19:18.970 --> 00:19:21.710 makes some mutual funds to make it real easy. And 362 00:19:21.730 --> 00:19:26.130 they're called asset allocation type mutual funds. They have one 363 00:19:26.170 --> 00:19:29.380 that's made for conservative investors and they have one that's 364 00:19:29.839 --> 00:19:34.000 made for more growth investors, a little more aggressive. And 365 00:19:34.140 --> 00:19:38.430 in that they include All the different asset classes, all 366 00:19:38.470 --> 00:19:41.630 the different sectors of the economy, and they're buying all 367 00:19:41.710 --> 00:19:46.190 these stocks and investments within them and managing those for you. 368 00:19:46.509 --> 00:19:49.089 So with one purchase, you could have a fund that 369 00:19:49.130 --> 00:19:49.980 does it all for you. 370 00:19:50.019 --> 00:19:52.119 You. And you can do that at your brokerage. You 371 00:19:52.140 --> 00:19:54.059 could do it at your online brokerage. You could do 372 00:19:54.099 --> 00:19:56.920 it direct at Timothy plan. And effectively when you do 373 00:19:56.960 --> 00:20:00.630 it there, you're actually going through a brokerage there too, 374 00:20:00.690 --> 00:20:06.589 because the Timothy plan, the, the Timothy plan can't sell 375 00:20:06.630 --> 00:20:09.819 you directly, but they, they all mutual fund companies that 376 00:20:09.880 --> 00:20:13.670 I know of start a brokerage that they can then 377 00:20:13.829 --> 00:20:16.869 utilize to help you get into their funds. 378 00:20:18.289 --> 00:20:18.769 Absolutely. 379 00:20:19.509 --> 00:20:21.990 Marshall, for you and for anyone who's wondering, you know, 380 00:20:22.049 --> 00:20:23.529 maybe you're thinking, I might want to reach out to 381 00:20:23.569 --> 00:20:25.470 the Timothy plan. I'd give them a call at their 382 00:20:25.519 --> 00:20:30.200 shareholder services number. Mark, that number is 1-800-662-0201. You can 383 00:20:30.859 --> 00:20:32.759 tell them that Mark Manilla sent you also for sure. 384 00:20:32.920 --> 00:20:35.960 Absolutely. And if you didn't remember that number, it's 1-800-TIM-PLAN. 385 00:20:37.710 --> 00:20:38.049 Perfect. 386 00:20:38.549 --> 00:20:38.910 Easier. 387 00:20:39.329 --> 00:20:39.650 Easier. 388 00:20:39.690 --> 00:20:43.240 That's why he's here. That's great. Thanks for that, Mark. No, 389 00:20:43.279 --> 00:20:43.700 it's really good. 390 00:20:43.920 --> 00:20:46.480 You know, Mark, I have often wondered as well, and 391 00:20:46.920 --> 00:20:48.940 I'm someone, I don't mind telling our listeners this. I actually, 392 00:20:49.039 --> 00:20:52.079 I have, you know, a 403B through the ministry that 393 00:20:52.240 --> 00:20:53.240 is in mutual funds. 394 00:20:53.289 --> 00:20:54.950 That's kind of more, a little bit, as you can 395 00:20:54.970 --> 00:20:55.569 call it, hands-off. 396 00:20:55.589 --> 00:20:57.930 And then I've got my regular investments in my Roth 397 00:20:58.009 --> 00:21:00.450 IRA following the, you know, growth model. 398 00:21:00.470 --> 00:21:02.710 And that one's a little more hands-on. But I like your. 399 00:21:02.589 --> 00:21:05.009 Explanation there, Mark, of even if you have the ETF 400 00:21:05.069 --> 00:21:07.970 or the mutual fund, and that's kind of the way 401 00:21:07.990 --> 00:21:10.029