It's Friday here at Radical Personal Finance. On Fridays, we do Q&A. Let's get started. Welcome to Radical Personal Finance, the show dedicated to providing you with the knowledge, skills, insight, and encouragement you need to live a rich and meaningful life now while building a plan for financial freedom in 10 years or less.

My name is Joshua Sheets and I'm your host. Today it's Friday, so we do live Friday Q&A, although this promises to be interesting, doing some things I've never done before. So time to learn and grow, right? That's the whole point. One of the things, last couple of weeks I've been getting the results back from your surveys.

Some of the results to me were pretty astonishing, but a couple of the things were very nice and very gratifying. I learned a lot about who you are as a listening audience. I learned some of the demographics, which have been super, super helpful, and some of it has been a little bit surprising.

Now a couple of the things that I learned, I don't know if it was surprising or not, but one of the things that I learned was just simply that the majority of you who are listening are right in that 25 to 54 age bracket. Most of you make a lot of money and most of you have college educations.

The challenge of that scenario of you all making a lot of money and having college educations means that I'm not achieving one of the goals that I have set for myself, which is I've been trying to reach people who are just getting started. I've been trying to reach people who are younger, who are poor, et cetera.

Now I know I'm not going to talk long about that, but as I've been considering that, I realized, well, I don't know that younger people are listening to long format podcasts, but they are watching videos. So I'm going to determine to learn how to do video. I've put it off for a long time to simply choosing to focus on audio primarily, but I've decided, okay, it's time to do what I can.

So of course I'm a minimalist. I try to do as much as I can with minimum equipment and make it work. So I have been putting together a video setup and at the moment I am live streaming. Finally, after threatening it some months ago, I'm live streaming the recording of the show here.

I'm live streaming it in the Radical Personal Finance Facebook group. So if you'd like to see this, I intend to do this more often. Sometimes I think I'll do it on the page. So if you haven't done it, come on by and like the Radical Personal Finance Facebook page.

And sometimes I think that I will do it in the Facebook group. So come on by and join. If you'd like to do the chat with us, come on by and join the Radical Personal Finance Facebook group. For those of you who are watching online, thank you. Feel free to interact in the comments and contribute your commentary.

But all of that said, it obviously makes me very nervous. I get very nervous being on video and when you've got to produce a show and hopefully make sense, give proper financial answers on technical complex topics, do it in an interesting and concise way while recording video and audio, I'm feeling the pressure at the moment.

So you'll have to bear with me if we make mistakes. So let's see. Let's go first to... I see Greg is here on my screen. Greg from PA. Greg, go ahead and introduce yourself and let me know what you'd like to talk about today, please. Hi, Joshua. Can you hear me?

I can hear you well. Yes, sir. Go ahead. That's funny because I'm looking at your face on the computer and your voice here. It's funny. No, I just saw you were doing the live feed, so I jumped right in. I wasn't even thinking about it. So I'm just excited to be here.

Do you have a question or a topic of conversation? Yeah, I can come up with a question. I've got 10 million questions. You know what I've been thinking about lately? Okay, I have three cars and I keep wondering why do I have three cars and one's a good family mover.

It's a Toyota 4Runner. One is an electric car that I love and the other is an Acura that's about 10 years old or a little over 10 years old and it gets great glass mileage. I keep thinking, "Boy, each of these cars fits a different need in my life." I could save some money if I got rid of one of them, but then I'm like, "Do I get rid of the 12-year-old Acura?" I don't know.

It's something I keep thinking about. Would I save money if I didn't have these three cars, even though I save a lot of money with the Nissan Leaf? So you had two and then you bought the Leaf in order to get the benefit of the cheaper running it with electricity.

Is that right? Yeah, that's about right. I found it down the street. I was just kind of interested in it and I love that car. It's a lot of fun to drive, but it's just limited on the miles. We take off on the weekends and to get to the weekend location sometimes, I just can't do it with that car.

For my work as well, I might travel to the next state over and I can't use that car. So I've been holding on to the Acura. It really doesn't owe me any money because I bought it brand new and it's still kicking really well. I don't know. So it sounds like this is just kind of a little minor tweak that you're trying to think about making.

Is this a small little optimization in your approach and you're trying to figure out how much it's costing you and if it's worth the hassle. Is that right? Yeah, I think so. Because for instance, I just did a job and I drove, I don't know, let's say an hour and a half away.

And the Acura gets about 38 miles to the gallon when I'm on the highway. So it runs really, really well. But I'm paying the insurance. I'm paying the registration. I just had it inspected just now. So I guess it costs that up. And the one other thing I keep thinking about it, I don't know if you're familiar with this, but in our state, Pennsylvania has insurance that is stacked.

So I have it stacked on three cars. So I kind of think I get this benefit from that as well. You know what I'm talking about with that? Where, you mean your coverage is increased or a reduction in rates? How do you mean? So I guess in Pennsylvania, you can opt to have your insurance stacked on the multiple vehicles.

So if you had say $100,000 in liability insurance, if you stack it and you have three cars now I have $300,000. Right. Got it. For instance. So I think that's got a great benefit to it as well. Well, I mean, obviously this sounds like just more of a fun question than something that you're really struggling with.

It's not obviously a huge financial issue for you. I would just calculate the cost. It doesn't sound like any of these cars are worth a lot of money if you sold them, right? Is that accurate? I would say you're correct on there. Yes. Okay. So if cars are cheap and they're not worth a lot of money if you sold them, then you're in a situation where it doesn't cost you that much to keep them around in terms of depreciation.

So your basic calculation is the gasoline that you put through them, but in the calculation of whether to keep them or not, that's not relevant because you're going to be driving one of them. So we're not talking about driving less. And it comes down to repair expenses and cost of insurance.

If the cost of insurance is small, which probably sounds like it probably is. So cost of insurance is small. And then also the brands that you have, a Toyota 4Runner and an Acura, which is an Acura is a Honda. These are reliable, consistent brands that aren't going to cost all that much money to keep around.

In my mind, they're not costing you a ton. The electric car is obviously for fun and to save a little bit of money on gasoline. If you don't need the money and you like having the extra car, keep it around until you get in the situation where you are frustrated with having to make the repair bills.

That's what I would do. At the moment, I own four cars. I own too many vans. I own a camper van and I have this little Toyota Corolla that I bought for $500 back in the day. It's just nice to have an extra car. I like it because it allows me to help people who are in need in an easier way than other people.

It's a little hard to say, "Hey, somebody needs a car and I'm going to give them my primary car." But for me, one of the big reasons I have the Corolla is I can keep that car around. It costs me almost nothing. I've not had to repair anything. It's super basic, super simple.

The insurance practically doesn't cost anything. Then I can have a car that's easy to lend out and allows me to help other people when they need to. If I were you, and absent some compelling reason to get rid of them, and unless you're sure that you just don't want to own one of them, I would keep them around myself.

All right, let's go on here. Greg, I can come back to you in a little bit if you got another question. I've got a 703 phone number here on my screen. Who's that calling in? Go ahead, raise your hand, and introduce yourself. That's me. That's Frank. Okay, Frank. Yeah, I can hear you great.

Go ahead and tell me what's going on. Let's see how I can serve you today. I recently met with my insurance person, and he is proposing that I invest in something called a modified endowment contract. I don't even know what that is. It's from a company that he used to work for.

I'm hoping you can tell me something about it. Sure. Let's start with just what is a modified endowment contract. Let me explain that first, and then we'll come back to your specifics and see if we can give you any useful advice on it. A modified endowment contract is simply a term that means ...

It's a technical IRS term that applies to a life insurance policy. When you own a whole life insurance policy, you have as a component of that life insurance policy, you have a death benefit, and you also have what's called the inside buildup of cash values. These cash values in the account in the life insurance policy equate to a portion of the reserves that the insurance company has set aside to pay your benefit when you die.

In times past, one of the great benefits of life insurance is there's no cap on who can buy insurance based upon income. Anybody who wants to buy life insurance, if you make $10 million a year, you can buy in and you can buy as much as you want. You can put $1 million a year into the insurance contract.

In addition to that, you have the benefit of the fact that these cash values inside the policy build up without being taxed year by year. Cash values inside the policy, you don't pay income tax as those values grow. You don't pay capital gains tax and you don't pay ordinary income tax.

This is really valuable, especially because some of the contracts can grow at a pretty decent rate. Generally, life insurance is very stable, but they can grow at a pretty decent rate. Now, when you put these two things together, you have an opportunity for people who are wealthy to say, "Hey, I've got something of a tax shelter here and I can buy a lot of it." You have the possibility that wealthy people will take advantage of this tax shelter.

That's what traditionally has happened in the life insurance marketplace. Lots of people would put lots of money into these life insurance contracts. I forget when it was. Was it during the '80s? That's what my guess would be, but I'm not very confident in that date. A few decades ago, the IRS changed the rules and they created something called a modified endowment contract.

They said that if you were in a situation where you put too much money into this contract, you're obviously just using it as a tax shelter. It's not actually a life insurance policy. The whole point of the tax code was that they wanted it to be for a life insurance policy, not as a tax shelter.

They have a rule. The rule is that you can't put more money into the premium than is required to buy a certain type of policy in under seven years. You have to fund the policy for at least seven years. The way this gets applied in the world of life insurance is if you buy a life insurance contract wherein the premiums are paid off in fewer than seven years, so examples here would be if you buy a single premium life insurance policy, you give the insurance company $100,000 and they say, "Hey, here's a $400,000 policy," that would become a modified endowment contract.

If you pay the policy in anything less than seven years, so you pay it for premiums for five years and then you quit paying, that would be a modified endowment contract. If you put yourself in a situation where you put too much money into it and you pay more premiums than what would be required to pay the policy off in seven years, under that situation, you turn the policy into a modified endowment contract.

The problem with a modified endowment contract is it loses the ability to get the money out without paying taxes. Let me explain that. You don't lose any tax benefits on the death benefit. All life insurance policies are always received by the beneficiary without paying any income taxes of any kind.

That's the same no matter what. All life insurance policies are always received, proceeds are always received by the beneficiary without any income taxes. But the owner of a contract has the ability to take money out of the contract as a loan, an advance of cash values. When the owner of the contract takes money out of the policy as a loan, an advance of cash values, they can take that money out under what's technically considered to be an advance of death benefit.

They can take that money out and they can receive it without paying income taxes in the current year. What a modified endowment contract does is it cancels that benefit and it cancels also the benefit of what's called FIFO, first in, first out, which is another benefit of a life insurance contract.

You can put in premiums into a life insurance policy and let's say you've contributed $50,000 of premiums and then you now have $100,000 of cash value in the contract and let's say your death benefit is $250,000. Well, under the terms of the tax code, you can always take out the premiums that you've put in and you don't incur any tax.

So you could take out 50 grand. It's not a loan. It's just a distribution and that comes to you tax-free under the first in, first out rules. Well, when the policy becomes a modified endowment contract, that goes away. So all of that to say, that's what a modified endowment contract is and it's not necessarily a problem.

It just might be a problem in application. It's not a problem if you're buying a policy for death benefit. It might not be a problem depending on the application of the policy. It is a problem if you're trying to buy the life insurance policy for the death benefit, but you're also hoping to get the benefit of the tax favored distribution of cash values.

So Frank, that's the technical answer. Hopefully I didn't make you go to sleep. Tell me more about the actual situation and why you're considering purchasing such a contract intentionally. Well, I'm not. I'm wondering why he proposed it. I'm going to meet with him again and try to find out, but I first wanted to know what it was.

Are you sure that he proposed a modified endowment contract as a good solution for you? Yeah, he emailed me the form and the illustration and the whole bit. So hold on one second though, because sometimes, did he say in the contract, did he say that it's a modified endowment contract, or was that just written on the illustration?

Oh no, it's written. I mean, I open it up and it says, "Modified endowment contract." What is it and why should I purchase one? And then it's followed by an illustration. So what you're telling me is it sounds like it is essentially a whole life policy, but without some of the tax benefits that such a policy would ordinarily qualify for if it was done in a certain way.

No, I don't think that's what's happening here. Let me explain. If this life insurance agent is proposing to you the purchase of a whole life insurance policy, they are probably proposing it to you for the death benefit, but also as a place for you to accumulate some cash within the cash values.

So when you're proposing that and you're designing a life insurance contract, one of the key things that the agent is trying to do is they're trying to make that policy accumulate cash very efficiently. One of the problems with life insurance policies for the purpose of cash accumulation is that you have to deal with large costs of insurance.

After all, there's a death benefit, and that's the cost of insurance. That's a feature that a straight up investment doesn't have. When you go and you buy a mutual fund, you don't have to also pay for the proceeds of a life insurance policy out of it, but in a whole life insurance policy you do.

So in order to increase the cash values, what is common in the life insurance business is to add what are called additional premiums to the contract. So if you were to look at that life insurance illustration from the insurance company, you would find on there most likely, let's say, about how much of annual premiums is the proposal for?

This is, let's see, insurance $1 million, annual premium out like $40,000. Yeah, that's what it is. So he's proposing, or the illustration is for a $40,000 annual premium. Now on that contract, when you look at that, if you look down somewhere on it, it'll tell you what the base amount of the insurance is.

Depending on your age, let's just say this base amount of insurance, the cost of that is $15,000 or $20,000. Let's just say $20,000. It's $800,000 in the upper right hand corner. So the base amount, $800,000, additional protection, $200,000. But what's the premium? It'll be down at the bottom of the page usually.

Annual premium? Yes, down at the bottom. So let me just talk you through it because I don't want to get on the show here, I don't want to publicly get into too much of an illustration, but I'll just tell you what's on a page like that. Down at the bottom, underneath the rows of numbers, you'll see at the bottom where it'll show you somewhere, it'll show you the base premium.

And so the base, it might be at the top or it might be at the bottom, but it'll show you the base premium. And the base premium is probably in the range of $20,000 for some amount might be whole life insurance, some amount might be a term insurance component of that.

And if you add all that together, let's just say for sake of illustration here that it's $20,000 per year. But what the agent... Maybe this will help. It says the contract premium is $40,000 including 16,864 additional premium. Exactly. So that's exactly what it is. So under your situation, the annual contract premium is $40,000 and $16,000, I'm just going to use round numbers for the sake of audio, $16,000 of that is additional premium.

Now under whole life insurance, which is different than universal life insurance, those are optional dollars. That's money that is optional, it doesn't have to go into the contract. The reason it's there is because that money goes directly to the cash values of the contract and it bypasses the cost of insurance.

And so the agent is putting that on there in order to help the cash value and the policy grow more quickly in the early years and also to grow more quickly, hopefully over the long term. And so the base premium of the contract is $24,000 per year. That's the actual cost of the insurance.

That's the minimum that you can pay for that size of insurance policy at your age. But they have in there an extra $16,000 of additional premiums. And so that additional premiums that bypasses agent commissions, it bypasses cost of insurance and it goes right to the cash values. The problem is this, you can't do that forever.

So on your policy illustration, it will show you a year that it becomes a modified endowment contract. So it'll say somewhere, "This policy will become a modified endowment contract in year," probably something like year 15, year 20. Do you see a number or a statement like that anywhere in the illustration?

Let's see here. Would it be in the rows of years? Probably be at the top. Depends on the company. Yeah, modified endowment as a policy year 17. Okay, right. So now what they're saying is that this contract becomes a modified endowment contract at year 17. But anytime before that, it's not a modified endowment contract.

And what the agent is going to propose to you is they're going to propose to you that you stop paying the premiums before year 17, or that you at least remove those additional premiums before year 17. Because the computer is calculating that at that point in time, you're going to reach that MEC limit, that line in the contract, at which point if you go beyond that, you're in a situation where you've put too much money into it.

So what they will do is they'll give you, they sent you an illustration that shows you paying premiums for all of the years. But during your consultation or during the actual next stage of the sales process, they're going to give you an illustration that shows you stopping payments probably at year 15 or year 17, or reducing at least the additional premiums.

And they're going to show you how that contract does it. The reason in the attachment it says this is what a modified endowment contract is, is because in order to cover themselves, the insurance company puts in the quoting software, it forces that disclosure page to be in there any time a proposal is run by the computer system.

So that's why it's in there on that page. Now, probably the next question you're saying, is this a good thing or is this a bad thing? How old are you now, Frank? Frank - 50, how old am I? 52. Okay, so they're going to be proposing this that it ends at 65 or 67.

That's why they've done it, is so that when you stop working, that you can schedule the life insurance premiums to stop being paid. And they're trying to build a policy that is big and that is efficient for your goals or for whatever you express to them or whatever they are identifying as saying, "Hey, we think Frank is going to like this." There's nothing wrong with that.

All of my whole life insurance policies that I own are built in order for the premiums to be done. This is called in the insurance angle, this is called quick pay, where the goal is to quick pay the policy. So I want to put the money in pretty quickly up front, and then I want to be able to stop at a certain point in time.

And depending on your age, this may or may not be a good thing. But for you, I'm sure this rep is thinking about, "Hey, when Frank retires, I want to tell him that he doesn't need to keep putting money into it." Make sense? Okay. Yeah, no, that does make sense.

And I see, yeah, that they sent me multiple PDFs, and one of them does have a cutoff. The next one I'm looking at, the first one did not. Okay. No, I really, I literally opened this up and I said, "Why are you not interested in this?" Why do I have somebody who doesn't know what to do?

Well, that's what I'm here. It's interesting. Life insurance is the worst. In some ways, it's the best sales process. In other ways, it's the worst sales process. And it's the worst because there's so much technical information. And the life insurance agent has to simplify it enough to really make sense.

But then they also have to be thorough enough to cover the legal and the technical requirements for disclosure. And it's a real hassle because those illustrations that life insurance agents send out are the worst. And what you got in terms of an emailed thing when I was an agent, I used to hate sending those out because it's charts and charts and columns of numbers.

And the problem is it's important. It's important disclosures for the prospective client because they need to know how things are going to work. That's the data that they need for analysis. But nobody understands how that stuff works. So hopefully you'll feel a little bit better equipped to understand what a modified endowment contract is and you can have a more productive conversation.

Anything else before I go on to the next caller? No, no. Go ahead. Go to the next one. Awesome. Let's see here. I've got an 847 number from Illinois. Go ahead, please, and introduce yourself and let me know how I can serve you, please. Hi, Josh. It's David from St.

Louis. I had to hang up earlier. No problem, David. Go ahead and let us know what your question is. All right. So I sit on a board at my church that manages trust, and a very nice member when they passed away left us $90,000 in cash and $320,000 in what I've been told before our first meeting is everything.

Mutual funds, stocks, bonds, everything. So I'm not really sure how moving money around works for churches, and I know they're looking for this to be a long-term thing where they can kind of draw down 5% every year. That's their goal on paper right now. If Joshua Sheets joined my church, what would he do?

So there's two answers to that. There's the philosophical answer of what would be an appropriate way for a church to handle money, which is kind of an interesting theological and philosophical question. Then there's the practical financial planning question, which is probably in some ways more straightforward. Let's try to tackle the technical one first, and then you can see if you want to talk about--let's go back to philosophical.

Do you know what form the money is--so you received a bequest. The member died, and they left the money to the church. Was the money left in the context of a trust, or was the money just simply left in a beneficiary arrangement on these different accounts? I believe it is a trust.

I know we're going to exit it through Charles Schwab, and then we're free to move the money around however we want. And we haven't met yet for the first time, so that's all I know at this point. So without your having more information, I can't give you much useful information in terms of what's actually going to happen.

So let me give you the questions that you need to ask. With this person leaving the money as a trust doesn't tell us anything. There could be various types of trusts. For example, this could be a trust that they've established for the benefit of the trust, and it's a trust that they have an independent trustee who's going to handle.

And what they've decided is that the trustee is going to distribute 5% of the assets to the church each year on an ongoing basis until the money is used up. And if that is how it's arranged, then you as a church, you have no decisions to make in the matter.

There's nothing that you need to do. You can't make any investment decisions. There's not anything that you guys are going to be responsible for. If that's the actual situation, then you just simply cash the checks and put them into the general operating fund and move on with your life.

It also could have been left with an actual trust that was set up for you to, let me just think for a moment, it could be set up as a trust where you take over as a participant in the trust in some way. Maybe you're a trustee. Well, if you take over as a trustee and you're a participant in the trust, then of course you would have to make those decisions.

But you don't have any information to know that today is going to be relevant to your decision. I do know that we will be able to move the money around because there's one guy on the board who said, "Well, the stock market's an all-time high, a bunch of it in stocks.

So the moment we assume control of it, sell everything and set it down somewhere." Okay. So, yeah, so it could just be left to you. Well, in that situation, then basically the technical answer doesn't matter. It goes down to the philosophy. What is the best use of it? And here you got to handle the investments of it.

Is this particular member right? Is the stock market at an all-time high? And then you've got to answer the philosophical question of what's the best way to use money? Is it a good idea for a church to keep large sums of investment money aside, or is it good that that money be spent quickly?

So let's skip the market answer because that answer will be highly dependent upon the advice that you get, the philosophy that you have. What do you think should be done with the money? Well, I do know we've been giving has been sort of down for the last few years.

So there was a thought that this would almost plug in kind of the budget gap if we were drawing it down a little bit every year. So then in that sense, I understand and agree with, well, if we can hold this sum of money and use this to kind of fill in some of the gaps, you know, for maintenance around the church and for programs and things like that, that's not a terrible use of it for the life of the church.

I agree with you overall in the greater scheme of things, yeah, it would be better to send a hundred missionaries somewhere or something like that. But for the day-to-day life of the church, I can kind of see where the majority of people say, yeah, we'd like to draw down over the period of years a certain amount of money to help plug in a budget gap.

Are some people lobbying for the money to be kept as a fund, an endowment fund, that can be drawn down more slowly? Yeah, yeah, that is the initial thought before we go into the meeting, that it would be, yeah, 5% drawn down every year to kind of help with the church budgeting.

And what benefit are they trying to get out of that? I'm sorry, I don't understand the question. So why are they wanting to do that? Why do they think it's a good idea, philosophically, for a church to have a sum of money that they're taking an investment return off of?

Ah, I suspect that trustees are looking at, we've had a few years of red ink and they're thinking that this is, you know, literally, you know, a manna from heaven or a gift from God, and that this would kind of help sustain the church while we look at other priorities or budget problems, or we see, you know, maybe it was giving just down for a few years and then it picks back up and then we can do, this doesn't close all the doors, now we have options to disperse the money onto larger projects, scholarships, or things like that.

Well, so that's a philosophical question that you've got to answer from scripture and in discussion. It's not a technical financial planning question. I'll tell you my opinion, just in case it sparks some discussion. If you put me in that boardroom, I would be lobbying against keeping any kind of endowment fund.

I don't think it's a good idea for, especially a church institution, but even most institutions, to try to maintain the idea of keeping large amounts of money on an ongoing basis, and I'll tell you why. Especially with churches, and this is something that people who are involved in churches, assuming this is a Christian church, one of the basic understandings of a Christian church is that the Christian God is a God who is living and actively involved in the world.

And so that means that he's living and actively involved in money. And you want to make sure that all of your actions and that your decisions actually reflect that. So, I wouldn't be seeking to try to set up an institution that can function without the active involvement of the people.

And in a church environment, the church is not here for its own self-enrichment. The church is not here to say, "Look how great we are, look at how big, fancy buildings, look how wonderful we are." The church is a living organism. It's a body of people who are involved, and if you bring that together and you just say, "We've got an external sum of money," you miss that.

And churches are going to grow, they're going to decline, and God's not scared to let a church die. And so you don't want to try to prop something up. I think what should be done with the money is you should look and say, "What are the biggest, most pressing needs that we see right now that we can use this money to contribute to?" That doesn't mean that you turn around and say, "This week and this month, we're going to try to get rid of it as quickly as we can and buy a bunch of useless stuff." That's not the point.

But the church should have, "Here are the priorities, here are the opportunities for it." And the goal should be, "How can we steward the money over the short term and get rid of it into the biggest return?" And if a church doesn't have a better return for their money than the stock market, I've lost all confidence and faith in that church.

I mean, the number of options that are available to multiply the money is so much bigger under the stewardship of a local church. I mean, it's incomprehensible to me that we wouldn't have a list of those things that we're focusing on. Why would we be considering the stock market?

We should have so many more opportunities that are there to make exponential returns. And I'm talking about financial, but even just in terms of impact. $420,000 is a substantial sum of money that can make a dramatic difference in some local projects. But when you'd say $21,000 per year is a basically inconsequential amount of money that's not really going to make a big difference on an ongoing basis.

So I personally wouldn't say, obviously, we don't want to be good stewards of it, not waste the money. But the goal should be over the coming years, as in fewer than five, we're going to invest this money and get rid of it back out into something that's going to be a much better return.

I think it's a problem. It's a real, in terms of charitable giving, if I had given that money, I would actually stipulate that the money needs to be gone within a certain amount of time. Maybe it's a decade, maybe it's five years. But institutions, especially institutions that are arranged under a religious cause, under a religious banner, or under some sort of charitable philosophical banner, institutions run the risk of being hijacked by people down the road.

And you can see this in every major institution I've ever studied, every large charitable organization, every large university. The universities and the institutions change over time. And the original founders to the Harvard endowment might or might not be very happy with what's going on at Harvard today. And so I think it's important to me, when I'm giving money, I want to make sure the money is gone in a relatively short period of time, because I don't want an institution to be created, especially a church.

I don't want a church that can continue functioning without God. And that can happen when you pile up big coffers full of money. God left years ago, but yet the people keep going because there's money. And I think the same thing applies to other charitable institutions. So that's a pretty strong, and I don't know how usual or unusual philosophical opinion that is, but I think that plans should be relatively short term rather than longer term.

What say you? That was part of the reason why I called, I love it, when you weave Scripture and theology into your talks, because I think that's very refreshing and something that's generally lacking, that's why I support the show. I think it would definitely be something that, yeah, in the next couple of weeks I'll look into, yeah, projects around the area that certainly, because it's north St.

Louis County, we might have--may or may not have been in the news recently in years--that certainly we could do something better and, dare I say, kinder with the money than, yeah, just kind of drawing it down like a church's IRA, kind of symbolically. So, yeah, yeah, no, I appreciate that very much, and I think, yeah, maybe that's God's way of telling us, "Hey, the value's so high, why are you going to sit here and mess around it, pull all the cash out, and let's do something with it?" I think your most powerful way to compare this is going to be, what impact does $420,000 of cash make versus what impact does $21,000 a year make?

$21,000 a year, how many people are in this church? Oh, it's a good medium-sized church, 200, 250, somewhere around there. Okay, so with this size of church, I mean, $21,000 can be fritted away in health insurance and painting the buildings and stuff like that. This is not going to make an impact, and I think if the original member who left the money behind, if I were the member, I would have stipulated, or if I were advising the member, I would have stipulated that they specifically think through an actual project or an impact.

$21,000 will quickly get lost in administration, and that's one of the major problems that churches face. I mean, even earlier you mentioned it in almost a kind of a reactionary defensive way of, "Well, we need these maintenance things done. We need to buy paint," et cetera. But this happens all the time, is that churches get together and they say, "Well, we've got to keep ourselves going," and they're concerned for their own self-preservation, and they're not concerned for their impact.

And so, yes, maybe the buildings do need to be painted, and maybe the money should be used, some of it should be used for that. I'm not the one to say. You guys have to decide that together. But in terms of impact, $420,000 is enough to maybe launch a project, launch a ministry organization, support somebody who needs support.

$420,000 is enough to make a major contribution to something specific, whereas $21,000 a year can quickly get swallowed up in a bloated budget. So I would approach it on that perspective, and if I were the donor, I would have stipulated that just in terms of impact. So you've got to take that and see what you actually think about it.

But since you called my show, that's my opinion. Great, great. That's what I was looking for. Josh, I really appreciate you taking time to talk to me today. Love the show. For sure, man. Wasn't expecting to talk about my philosophy on churches and charitable giving, but I guess that's what you get when you do a show like this.

Thank you all so much for listening, and for those of you who have called in. It's certainly a challenging situation for me, but we had several new callers who joined in from the Radical Personal Finance Facebook group. If you'd like to get on a call like this next week, jump on as a patron of the show.

These calls, at the moment I've reserved them exclusively for patrons. Just decided as a special thing to go ahead and I just decided to include the Radical Personal Finance Facebook group today, so that was where a couple of the callers were. And for those of you who've been watching the live stream, thank you.

We're starting to get to the size in terms of in the Facebook group. We have what, 750, 800 members now. We're starting to get to the size where I can do more interesting media things for you. And now that I am fixing my camera setup, I'll be doing more on the Radical Personal Finance Facebook page.

So if you haven't found those, come on by Facebook, search Radical Personal Finance, like the page, and join the group. Free to do that. Lots of other great people there. If you'd like to support the show, if you appreciate content like this and like to keep it with minimal outside interference, minimal commercials, etc., please consider becoming a patron of the show.

RadicalPersonalFinance.com/patron. You can support the show directly and that money goes directly from you into my pocket, which is very helpful and helps me do things like buy a camera and buy a light so that my face on the video screen looks okay. Thank you all so much for listening and I'll be back with you soon.

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