Financial Stewardship

[la_petit_fleur]

I have inherited quite a bit of money recently. I don’t have any debt except my house, and I don’t have my retirement fully funded, which is coming up in about 10 or 15 years.

I have an investment advisor who looks after my 401k. He works for a reputable company and has done a good job over the years. He is insistent that I need to invest this money.

I know it sounds crazy but this money is a burden because I worry so much about using it in a way that pleases God.

I’m nervous to invest it because I don’t know a lot about investing. I know if I just keep it in cash I’ll lose money due to inflation. I’d like to help people with it.

I signed up for a community college class on investing, but of course that is not going to help me to understand the Christian aspect of how to manage God’s money faithfully.

I’m at a loss as to what to do, and I’m stressed.

 

[Fauken]

I know it sounds crazy but this money is a burden because I worry so much about using it in a way that pleases God.

I’m nervous to invest it because I don’t know a lot about investing. I know if I just keep it in cash I’ll lose money due to inflation. I’d like to help people with it.

Don’t let perfection get in the way of good.

 

[la_petit_fleur]

Don’t let perfection get in the way of good.

What would be the good in this case? Not using it for anything immoral?

 

[Fauken]

What would be the good in this case? Not using it for anything immoral?

That, and be prudent with how you spend it. You don’t have to spend every penny perfectly, and splurging occasionally is fine, but you can’t go crazy with spending every day. If you want to invest it, consider hiring a financial advisor to help you. The community college class will help also. But try not to let it stress you out too much.

 

[Pattylt]

I can only tell you what I’d do…
Depending on what your future plans are, I would divide it into investment/charity/pleasure. The percentages of each are for you to decide. But do consider spending some of it for pleasure…a vacation, a remodel, new furnishings, car…whatever the amount will allow and you’d really like to do.

Just a note…of course your advisor wants you to put all of it in investment…that’s his job and his livelihood. It’s his job to invest the amount you decide on and take care of that amount but it isn’t really his job to say you must invest all of it. I’d certainly ask him if he’d invest it differently if you gave him all or half or a third just to see if he’d invest differently depending on the amount but it’s his job to invest only what you decide.

Congratulations, btw. It’s a problem many wish they had!

 

[la_petit_fleur]

Congratulations, btw. It’s a problem many wish they had!

I know! I feel guilty for feeling stressed! Oh dear, I’m a lovely mess.

 

[Pattylt]

When you inherit money, it suddenly becomes a bit of burden you never realized you have, isn’t it? Years ago, I inherited a nice sum when my father passed away. Since the settlement of his estate took a while, I was no longer in the intense mourning period but I still felt guilty anyway that I was partly rejoicing the money due to my fathers death! Then the reality of it hit me and I realized I needed to actually think about what I was going to do. I invested over half of it and the other half went 50/50 to charity and getting us into a house. I had little debt and was still young enough that the investment money had time to grow but it sure gave it a good boost! We had been in the process of looking at a house to buy and the funds helped us get a good loan with a healthy down payment…instant equity! We also set aside a little of it to help furnishing the living room. The charities were divided among three of my favorites and it felt so good to write those checks!

Everyone is probably a bit different in how they divide up money and it also depends on how much but over the years, I’ve stuck with any extra money being divided into those three categories…it works for me!

 

[edward_george1]

I mean, if it really stresses you out, you can send it to me. I know of a parish that could use it… .

I’m kidding.

Mostly.

-Fr ACEGC

 

[la_petit_fleur]

Hypothetically, what if I did give it all away? Since I don’t have any debt (except my mortgage), would that be imprudent?

I am legit worried about it impeding my faith, because we all know about the rich young ruler vs the widow’s mite, right?

 

[edward_george1]

I think you’re worrying too much about it if you think it’s going to impede your faith. Remember that Joseph of Arimathea was a wealthy man and a disciple of Jesus. There’s nothing wrong with having the money or spending it.

I would also add that you shouldn’t just give it away out of fear, rashly. Sit with it for a while. Get used to the idea of having it. You might end up needing it.

 

[Socrates92]

Take your time. If it is a vast amount of money that you want to use for best possible use, there is nothing wrong with storing it somewhere safe until it becomes clear what that is.

 

[Socrates92]

Hypothetically, what if I did give it all away? Since I don’t have any debt (except my mortgage), would that be imprudent?

Chances are, with the chaos in the world, you’ll have some chance to give it away in a really impactful way at some future point, say a relative or friend having trouble paying a mortgage or for food due to another shutdown. If that’s not the case right now, I’d personally just wait things out and put it in a high-interest savings account.

 

[la_petit_fleur]

Take your time. If it is a vast amount of money that you want to use for best possible use, there is nothing wrong with storing it somewhere safe until it becomes clear what that is.

Thank you so much. This brought a lot of peace and relief to me. I think what’s stressing me out is feeling like I have to decide right now. That it’s somehow wrong to have it sit in the bank because of inflationary loss.

 

[Socrates92]

Thank you so much. This brought a lot of peace and relief to me. I think what’s stressing me out is feeling like I have to decide right now. That it’s somehow wrong to have it sit in the bank because of inflationary loss.

Well, sadly there’s nothing you can do about the inflationary loss. But that’s on the gov’t, not you.

 

[Pattylt]

I’d highly recommend not giving it all away…the future is too unknown to make such a decision. Yes, do put it into a savings or money market account that will help with inflationary loss for the time being.

Do not think you have to decide what to do, how to divide it up, give it all away right now! I have no idea of your marital status or age. That can be important, too. This may be a once in a lifetime bonus to your finances…you want to make sure that whatever you decide, you won’t regret it. Instead, think of what future events are in store as best you can guess. Do you have children? There’s a chunk of money that you should make a decision about as well. No? Nieces or nephews? In laws? A parent?

As you think through all the various scenarios, none need to be decided now. You may decide to let it sit for a few months or even years. There isn’t any hurry!

 

[JanR]

No investment advisor has any business pressuring you into investing all of that money. Is he or she paid by commission or by fee? There may be a selfish motive in his or her insistence. But, it’s YOUR right to decide; it’s YOUR money. Don’t let anyone bully you into thinking otherwise (I would consider looking elsewhere for a different investment advisor if he or she becomes too pushy.)

The advice you’ve gotten above sounds good. It’s a conservative approach that has spread out the benfits.

Ultimately, though, it’s up to you. And, congratulations!

One more thing – don’t feel guilty. Whoever left you that money wanted you to have it. Just honor him or her – and God – by doing good and wise things with it. Nothing wrong with enjoying some of it for wholesome personal pleasures, either.

 

[whatistrue]

I know it sounds crazy but this money is a burden because I worry so much about using it in a way that pleases God.

I’m nervous to invest it because I don’t know a lot about investing. I know if I just keep it in cash I’ll lose money due to inflation. I’d like to help people with it.

Take your time and do your research. There are investment plans that are specifically designed to follow Catholic (or any of a number of other) guidelines for which companies to invest in. One thing that I would advise is to make any charitable giving decisions based on your own research and inclinations rather than responding to unsolicited “begging letters”, which, if it is public record or even just reasonably simple to discover that you got this windfall, will probably arrive in droves shortly. And of course the standard fallback advice for when you are overwhelmed and can’t discern what is right on your own: Talk to your priest.

 

[1ke]

I know it sounds crazy but this money is a burden because I worry so much about using it in a way that pleases God.

If you aren’t using it for immoral purposes, then you are using it in a way that pleases God.

I’m nervous to invest it because I don’t know a lot about investing.

Buy a book, engage a professional. Learn.

And you can park the money in CDs for a little while to learn about investing.

If your 401k guy is telling you that you aren’t saving enough for retirement, listen to him. Make some catch up contributions if you are over 50.

I’d like to help people with it.

You can talk to someone about estate planning, tax planning, and planned giving to help you with your goals.

not going to help me to understand the Christian aspect of how to manage God’s money faithfully.

There aren’t explicit requirements here. It’s a prudential matter.

I’m at a loss as to what to do, and I’m stressed.

You don’t have to “do” anything right away. Read some books on investing, find a money manager who has reasonable fees and shares your outlook on investing. The 401k advisor is probably a great place to start.

Speak to someone at the diocese about planned giving for your parish if you’d like to give money there.

 

[1ke]

Just a note…of course your advisor wants you to put all of it in investment…that’s his job and his livelihood.

Yes and no. A 401K advisor isn’t going to advise you to put all of it in 401k, with him, because that’s not even possible.

If the OP is only 10 years away from retirement and doesn’t have enough in retirement savings, it does make sense to invest most of it. The 401k advisor is giving prudent advice.

 

[Pattylt]

The 401k advisor is giving prudent advice.

I didn’t catch that it was a 401 advisor…yes, you’re limited in putting it into a 401.

Depending on his current savings, it could be prudent to add all of it and maybe not. It depends on the amount of inheritance and his needs, now and in the future.

Thanks for pointing that out!