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Retirement Investing - Restitution - What The Bible Says

November 18th, 2006 by Papabear

Last Sunday I wrote a post based on Malachi 3:11, where God promises:

And I will rebuke the devourer for your sakes, So that he will not destroy the fruit of your ground, nor shall the vine fail to bear fruit for you in the field, says the Lord of hosts.

I’ve had feedback from a couple of people on that post, so I thought this Sunday, I’d share another Bible principle. This one may seem a little more radical than the last one to many people. But since I believe the Bible is clear here, I feel like a preacher I heard one time who said “don’t blame me, I didn’t write the book.”

And like I said last week, for the benefit of any non-Christians or skeptics who are reading this post, it may not be for you. But for Christians this is the most practical kind of advise.

First let’s go back and look at a verse in the Book of John:

The thief does not come except to steal, and to kill, and to destroy. John 10:10

I wrote last week about praying for protection, according to the promise in Malachi 3:11, that the Devil would not devour your crops (our investments). That’s a promise for the future. But what about what’s already been stolen from you? This certainly covers at least any money we may have lost to swindlers, literal thieves and robbers – or even to white-collar thieves.

These kinds of conscious thievery are certainly covered by this principle. We’ll leave it to the theologians whether thievery here covers investments that went bad when the persons in charge of the investment originally only had the best intentions. Sometimes things just do not work out as planned. And the principle may well not cover a bad investment we made when we simply did not do our due diligence or got greedy and invested in something stupid that we should have known was too good to be true.

What we’re talking about here is the obvious kinds of theft. So what was the Bible penalty for theft? This can be found in Proverbs:

Yet when he is found, he must restore sevenfold; He may have to give up all the substance of his house. Prov. 6:31

So if the Devil or evildoers have stolen from us, what are we entitled to? According to Prov. 6:31, the Devil and the evildoers owe us a sevenfold restitution. OK, the principle is clear, so where do we serve the papers then? What’s the thief, the Devil’s, mailing address?

We know if we sue someone in a court of law, the judge and agents of the court can put a judgment against the guilty part. So where do we find a judge to settle our claim? The Bible talks about the ultimate Judge:

If one man sins against another, God will judge him. 1 Samuel 2:25 and

Let the heavens declare His righteousness, for God Himself is Judge. Ps. 50:6

The same principle and process applies here. God is our righteous Judge. But where do we find a lawyer to plead our case? In 1 John the Bible says”

My little children, these things I write to you, so that you may not sin. And if anyone sins, we have an Advocate with the Father, Jesus Christ the righteous. 1 John 2:1

This verse tells us who we can get that will represent us.

So we’ve established the legal principle of our right to restitution (Prov. 6:31). We have established that God is the ultimate Judge (1 Samuel 2:25) and that Jesus will act as our advocate (1 John 2:1). So how will we collect on what is owed us? Where will the money come from to pay restitution? Should we expect the Devil to write us a check? No, it doesn’t work that way. For the anser, let’s look at how God gets money to us in response to our obedience in tithes and offerings.

Give, and it shall be given unto you; good measure, pressed down, and shaken together, and running over, shall men give into your bosom. For with the same measure that ye mete withal it shall be measured to you again. Luke 6:38

God doesn’t literally drop the money down out of Heaven. God uses other men to get money to us. God can then be our process server to collect the judgment from the thief and can get the money to us through others, not even necessarily or even usually not the person who stole the money from us in the first place.

We can nearly all remember specific instances where money has been stolen from us, either by force or deception. Satan is the great thief, whoever did the actual stealing. Thievery is one of his specialties. God is the Supreme Judge, and Jesus is our advocate or attorney.

To put the principle to work, we need to remember specific instances of thievery, write them down, and present our case to God, our Judge, with Jesus as our advocate, through pray. We should ask for specific restitution, based on a specific incident, invoking a specific amount, and do this by basing our claim on Prov. 6:31.

If we believe God’s work is true, we can then wait for and expect restitution with the same certainly we would wait for a refund check from the government, if we are owed a tax refund. This does require great faith and a clear belief in God’s Word. This is a great test to find out who you trust more: the government or the Word of God?

If you have thought or comments, please respond. We welcome your comments, whether you agree or disagree.

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    Retirement Investing - Borrowing From Your 401k - Part 3

    November 2nd, 2006 by Papabear

    So far we’ve discussed 4 reasons borrowing from your 401k account might be a good idea and 2 reasons to reconsider. Today we’ll finish out the 8 things to consider with 2 more reasons you might not want to borrow:

    7. A home equity loan may be a better solution from your particular situation. Most states, with the notable exception of Texas, where I live, have made setting up a home equity line of credit simple. If you have enough equity in your house, and you have a good credit rating, you should consider a home equity loan. Unlike a loan from your retirement account, the interest you pay on a home equity loan is usually tax deductible.

    8. There may also be special deals available that are better than a loan from your 401k account or a home equity loan. For example, at the time this is being written, several car companies are offering 0% financing for up to 60 months. If you qualify, this is a much better way to finance a new car that borrowing from your 401k account or using a home equity line of credit to buy a new car.

    In conclusion, everyone’s situation is a little different. When you’re talking about $1,000’s of dollars and the impact of tax laws, it’s always best to get professional advice from an accountant or tax attorney. It may cost you $100 to $200 for a simple consultation, but it will be money well spent to find out what’s right for you and your situation.

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    Retirement Investing - Borrowing From Your 401k - Part 2

    November 1st, 2006 by Papabear

    Let’s see – 4 good reasons to borrow from your retirement account. Here are 2 good reasons not to borrow from your 401k account:

    5. As the old saying goes “some restrictions apply.” Our friends in Congress and the IRS don’t want this to be too good a deal, even if it’s our own money. After all, Congress thinks they did us a really big favor with 401k accounts by making it easier to save for retirement. Maybe they did, but like many good deals, this one comes with strings attached. First there’s the $50,000 limit. Even if your have $200,000 in your 401k account, and the general rule is you can borrow up to 50% of your 401k account balance, you are limited to borrowing $50,000 at any one time. In addition most plans usually limit the number of loans you can have at any one time to 1 or 2. For example, if you borrow 50% of your 401k account balance of $50,000 on a 5 year loan, and the $25,000 left in your account triples over the next 3 years from savings and increases in the value of the investment to $75,000, you cannot borrow another $37,500. First you are limited to a total outstanding balance of $50,000. Second, if your plan restricts you to 1 loan at a time, you will not be about the borrow 50% of the new value in your account until the first loan is paid off. Even if your plan allows for 2 loans at a time, most plans have another restriction that says the amount you can borrow on the second loan will be reduced by the highest outstanding balance on the first loan during the previous 12 months.

    6. If you switch to a new company, you may have to pay off your loan immediately. In many cases, this can be avoided by rolling over your 401k account, but if you can’t do that, the outstanding balance of your loan will be considered an “early distribution” from you retirement savings account and will be deducted from what you have available. You won’t have to pay the money back, but you will have to pay taxes on the balance of the loan as ordinary income. And if you’re less than 59 ½ yeas old, you will also have to pay a 10% early withdrawal penalty.

    Thinking about paying extra taxes is stressful, so we’ll end here today. Tomorrow, I’ll post 2 other reasons to think twice about borrowing against your retirement account.

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    Retirement Investing - Test Drive Your New Retirement Community - Part 2

    October 26th, 2006 by Papabear

    Yesterday we talked about renting out your house, storing your furniture and getting set up to test drive an area you’re thinking about moving to before you actually buy there. This can be one of the best retirement investments you can make. When it comes to retirement investing, it can pay you huge dividends on the money you will spend. Today we’ll talk about why you need to get to know the area better before you put spend money on a home in a new area.

    One of the big benefits you get by renting in an area before you buy is you’ll get to know the various neighborhoods. This is especially important if you’re not buying in an age restricted retirement community. In a retirement community, at least you know what kind of development will be going on around you.

    If you buy in a regular neighborhood in a town in, say, the Sun Belt, you could be in for a rude surprise. If you rent first in your new area, it will give you time to find out what the future development plans are for the area you’re considering. If you’ll start reading the newspaper and watching the local TV news, you can learn some very valuable information.

    For example, when we moved to the town where we live now, we almost bought a particular house because it was close to the local high school and had beautiful open fields behind the house. It was only by a little research and a lot of luck that we found out that the city was about to build a huge community recreational park on that field.

    Now behind the house we almost bought are youth baseball fields with stands full of screaming parents and tennis courts lighted to at least 10 o’clock every night with huge floodlights. And right next to that, they built a new football stadium for the high school last year.

    The beautiful back yard of that house is now as bright as daylight at 10 pm, and the floodlights shine right into the back windows of the house. And of course, if we had bought that house and decided we wanted to sell it later because of these distractions, it would be worth a lot less than we would have paid for it.

    Tomorrow we’ll talk about getting to know the realities of living in a new area.

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    Retirement Investing - Test Drive Your New Retirement Community - Part 1

    October 25th, 2006 by Papabear

    Retirement investing includes more that just your retirement savings account. It also includes makes choices about where you will live. Over the next 3 days, we’re going to look at a strategy that could save you a considerable amount of money and possibly a really big mistake if you’re thinking about moving to a retirement community in another part of the country.

    Many folks relocate when they retire. Many more folks think about it but don’t do it. According to the Del Webb Company, the folks who built Sun City in Arizona, the first master-planned retirement community, 47% of those 51 to 60 years old would seriously consider moving after they retire.

    Here’s a modest proposal to think about before you make that move. Take the area you’re considering for a test drive.

    You wouldn’t think of spending $30,000 for a new car without test-driving it. You would not buy a car based on just reading the brochures and giving the car a quick walk-around. Yet every day people spend $150,000 for a small house in a retirement community of modest houses to $1,000,000 or more for a Miami condo based only on fancy brochures and a brief walk-through.

    Instead, consider test-driving your new location for a year. If you’re thinking about a particular retirement community that’s limited to seniors, you also need to check out the surrounding local area. If you’re planning to buy in a mixed residential area instead of a planned retirement community, it’s even more critical.

    In most parts of the country, it’s easy to find a real estate agent who can rent out your current home for a commission of 10% of the monthly rent. You can put your furniture in storage for about $200 a month or less, pay a small increase in your home-owners insurance and then use the rest to pay your rent in the area you’re considering moving to.

    Since you’re probably planning to downsize your house if you move after retirement, the net amount you will have from your rental income after paying the real estate agency and paying for furniture storage should cover the rent on a smaller house in the area you are thinking about moving to. Also, since it’s only for a year, a small apartment may be fine.

    You may want to take a small amount of your furniture with you in a Uhaul truck, or you can rent some furniture from one of those rent to own places. Maybe you can even find a furnished apartment.

    Today we’ve talked about setting up a test drive of your new area. Tomorrow we’ll go into a couple of real world examples of why checking out your new area could save you a great deal of money and a lot of frustration later on.

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