Category: Stewardship

2021 – Year of Impact

by Ron Bare

Who or what are you impacting? This is the question we are asking at Bare Wealth Advisors in 2021. Each of us has an impact on someone or something, either in a positive or in a negative manner. Our mission at Bare is to help our clients “intentionally manage wealth that aligns with their God given purpose for maximum impact.” Our desire is to assist you in having the maximum impact with the wealth you are stewarding. What I (Ron) have learned over the past 25 years as a wealth advisor is that most of us aspire to having impact, but many things (both good and bad) easily get in the way of accomplishing this goal.

I recently heard a speaker say, “whenever we have excess it is easy to be wasteful.” It’s easy to think of this in terms of food, or time, but what about wealth? If you have more than enough, do you easily find yourself investing the extra into relationships or causes to help create impact? Or do you spend it on more temporal or short-term fun?

At Bare, we believe God has given us complete freedom to use wealth for enjoyment and for blessing our families, but also for SO much more! We believe in being intentional with excess wealth decisions so we can leave an impact and legacy. The end goal of managing wealth should not be endless accumulation. You have probably heard the saying, “you never see a hearse pulling a U-Haul full of our stuff.”  When we die, only what has been invested into people and impact will last. That is what we are passionate about. Imagine a world where we took the excess resources we have and intentionally invested these funds into causes or people for positive impact.

Let’s dream together about a few areas of possible impact:

Family – have we purposely invested into our families’ dreams, whether that be education, launching a business, or helping to fund a passion?

Local communities – how can we improve the community we live in? Do we know our neighbors and their struggles? Are we involved in local ministries? What other ways can we help our community?

World problems – what problem around the world do you wish to see positive change in? Clean water for all? Elimination of hunger? End of human slavery? Value of human life? I am sure we could name so many more.

Let me leave you with a simple formula for intentional money management so you can have meaningful impact:

  1. Work hard to earn a living and bring increase to your business. We were made to work and improve the earth. (Genesis 2:15)
  2. Learn to be content. Not an easy task but the more we learn contentment the more we can focus on the needs of others. (Philippians 4:12)
  3. Set long term financial goals – college, family, retirement, or other. When you know your goals, it is much easier to calculate how much you will need to accomplish those goals.
  4. Set a financial finish line. This can be an annual cap on your living expenses or a cap on your net worth. When this is set, work hard to grow your income or net worth (increase is good), but commit to using the increase for impact on others.

Following this four-step formula can help you intentionally have an impact in your family, local community, and the world. We look forward to working with you in 2021 to help you set and accomplish your goals and to begin discussions on what kind of impact you wish to leave this world!

Generosity – For it is better to give than to receive

At Bare Wealth Advisors, one of our core values is Generosity.

We believe that cheerful and generous giving inspires others in their purpose, enriches relationships, and expands the influence of the resources we manage.  All year long we love to lead our clients in conversations regarding generosity and strategic giving.  But certainly, something happens between Thanksgiving and year end that ramps up those conversations.  There is a clear connection between gratitude and generosity.  A connection between heart and function.   So here are some thoughts below about how you give in heart and in function.

How in our hearts:

  • As Jesus is sending out His disciples part of His instructions were “Freely you have received, freely give.” (Matthew 10:8b) As we recognize God as the owner and we as the stewards it positions our hearts in gratitude to give freely with no strings attached.
  • “God loves a cheerful giver” (2 Cor 9:7) This is a great chapter packed with why we should sow generously and give what is decided in our hearts.
  • “Each person is to give what has been decided in their heart to give.” (2 Cor 9:7) Giving is to be strategic, prayerfully considered, and is different for each person/family/business.
  • By Faith. “Out of the most severe trial, their overflowing joy and their extreme poverty welled up in rich generosity. For I testify that they gave as much as they were able, and even beyond their ability.” (2 Cor 8:2-3)

How in our function:

  • Donor-Advised Funds (DAFs). These are great tools that make giving easier in so many ways. A DAF is basically a savings account for giving that provides the tax deduction the year you place money in the DAF.  It can be directed out immediately to charities of your choice or wait until you decide to give it later.  It simplifies giving record-keeping to one place, provides ability to give anonymously, can be used to maximize bunching strategies with the current itemized/standard deduction tax law, and so much more.
  • Giving 100% of Adjusted Gross Income (AGI). For 2020 only! You can deduct up to 100% of your AGI using charitable gifts of cash. These donations must go to an operating nonprofit. You can not use a DAF for the increased amount.  (Though a single charity fund is an option)
  • Out of Assets not only Income. We often only think of giving based on income and out of cash.  However, there are lots of ways to give the same amounts but in a more tax advantaged way.  Several examples would be: charitable SWAP donating appreciated stock and using cash then to buy back the stock to improve basis, gifting portions of business ownership, giving of grain or other commodities, Real estate, and more.
  • Qualified Charitable Distributions (QCDs) – IRA accounts have no required minimum distribution (RMD) in 2020. But those age 70½ or older can still make gifts directly from an IRA to a nonprofit up to $100,000. This gift donates pre-tax dollars. The earned income is not once taxed because it goes directly to the charitable organization.

 Please reach out to us with questions as you consider your generosity goals!  We would encourage you as Ron Blue says,  to consider “doing your givin’ while you’re livin’, so you’re knowing where it’s goin’.”  For it is better to give than to receive.

(We have recently completed a new video sharing more about our roots of generosity – please check it out! (www.barewealthadvisors.com/about/values/givingroots/)

 

Securities America and its representatives do not provide tax advice; therefore it is important to coordinate with your tax advisor regarding your specific situation.

Market Update

by Ron Bare

In February of this year, I spent a week in Florida with my family as well as with some of our team from the office. Visiting colleges with our daughter, going to Disney’s Animal Kingdom, enjoying the beach, and attending the annual “Kingdom Advisor Conference” all seem like a distant memory. It is hard to believe that this was only three months ago! While we had heard a few “rumblings” of a new virus during our travels, we saw no masks or any cause for concern, even when boarding our plane on February 23rd.

The equity markets at the time were reaching new highs. The US economy was very strong, with record low unemployment and solid GDP growth rates. Although some were saying markets were beginning to look overvalued, the bottom line was that companies were profitable and were predicting even greater profits throughout 2020.

Then Covid-19 arrived and with it, full-blown panic. The market dropped 34% in 33 days, a record decline.  I discussed this in our video blog in late March (which you can find on our website.) Now, two months later, the dust has begun to settle and although the panic has subsided there is still uncertainty about where we go from here. The markets have since recovered much of their decline, however, a large amount of skepticism remains. With this in mind I thought it may be wise to pass on a few thoughts relating to investing success over time:

  1. When stock prices are going down, the enduring value of the underlying companies is going up. The lower prices go, the more value is to be had at those prices. You understand this in almost every other area of your economic life (we all love to purchase something on sale!) It is essential to apply this same principle to the stocks of American companies we invest in – or you may never become a successful investor.
  2. Staying fully invested during market declines is the only sure way to capture the entirety of the markets long term advance. It is not possible to consistently sell out of falling markets and buy back later at the “right” time. Most of the market driven news is geared toward market traders, NOT long-term goal and plan driven investors. To the latter, market fluctuations are just part of the process to be rewarded for the long term returns of some of the greatest companies of America and around the world.
  3. You should never try to make long-term investment strategies out of short to intermediate-term disruptions. We always advise to make investment decisions based on our values and financial plan, not short-term events or emotions. The past few months are a good example. Let’s assume you ignored the market downward collapse of 33 days in late February and March and woke up today, May 15th, and took a look at the markets. Yes, they are down 15-16% from earlier highs, but that is in the range of a typical market correction that happens about once every 12-18 months.

There is the ongoing chance that the markets will continue to drop back due to the uncertainty we still are facing with the Covid-19 virus and economic wake it will leave. If you adhere to the ideas presented above, then these fluctuations should not impact your long-term goal and plan driven investment strategy.  Perhaps when we focus on the long term, we not only will make much better investment decisions in the short term, but we also will rest better as we wait for time to pass.

Vision Reset

by Ron Bare

For many of us, both individually and as companies, the year 2020 was to be an exciting “Year of Vision!” As 2019 drew to a close we began thinking of developing tools and correspondence to help our team and clients pursue a greater vision – not only in the area of finances, but also in other areas that money can be used as a tool to enhance. Areas of life such as family relationships, health, friendships, spiritual enrichment and more can all be improved when we gain better vision in our desires for these areas.

Then, as you are very aware, Covid-19 arrived in our country and the urgent took priority over many other initiatives. “2020 Vision” suddenly took a backseat. Perhaps at first your response was, what is the point of planning or focusing on our future vision when we need to survive this health scare and the financial/job implications that may flow from it. That is how I felt as this unfolded these past few months. But now I have another thought – what if this “reset” or “pause of life” (which is unlike anything we have ever experienced) is a gift to actually help us get a better perspective for tomorrow? Would we have ever really stopped all the activities and busyness of our lives long enough to gain true “2020” vision for our future? I’m doubtful.

Have you heard the old saying “Eat Your Carrots – they give you good vision!” Well, as I child I loved carrots. I always chalked my love for carrots as the reason for my 20/20 eyesight. Even as many of my peers have started to lose their vision and need corrective eyewear to get back to 20/20, I proudly kept eating my carrots. But time is moving on and I find myself holding the paper and my phone a bit further away from my eyes as I read. I stubbornly have stayed away from the eye doctor but I must admit, to get back to “20/20” I may need more than carrots for my vision!

Perhaps this quarantine has been the “corrective eyewear” we needed to get back to 20/20 vision for our lives. Let us not waste the good that has come from this. What have we learned? What do we need to change when life gets back to “normal”? Do we really want to go back to the way things were? Like many of you I am ready to fully get back to work.  I am ready to get outside and go out to eat, “sit down style!” I miss sporting events, both locally and professionally. I miss actually going to church each Sunday. But I am not ready to go back to the hustle of plans most evenings and weekends, running to school/sports events often, and catching a few brief conversations with my kids and wife in passing. I LOVE the family dinners, games after dinner, conversations in the kitchen, cooking meals together, actually finishing projects that have been on the list, working out each day with my son and knowing that the upcoming weekend has a good bit of margin for life and rest! I love having extra time to connect with many of our clients on the phone and not running from appointment to appointment feeling rushed in many conversations. I want to listen to them, hear how they really are doing, and pray and help anyone I have the opportunity to spend some time with.

What is my vision for 2020 and beyond? How about taking better care of the body that God has given me and making exercise part of my daily life – doing it with my family. Growing spiritually as I read the Bible and connect with God on a deeper level because I’m spending time with God and actually listening to what He is saying in His word rather than feeling rushed by the next daily agenda item. Connecting with family by being together and enjoying each other (most of the time, 🙂 ) rather than just going to watch them participate in an activity. Really connecting with a few close friends and sharing life together. And working with additional margin so we can not only provide financial counsel but care and connect in deeper ways.

How about you? What is your vision for beyond the Covid-19 quarantine? What have you learned? What have you enjoyed and what do you need to DECIDE now so when life gets back to “normal” you do not, but rather you create a “new normal”. A normal with purpose, vision, margin, enjoyment and time to connect with God and people – the way God designed it.

Easter Message

by Ron Bare

As I sit down to write this, it is a sunny 70-degree day with a slight breeze, some would say near “perfect” conditions. It may be perfect weather but that’s not what I feel inside. I feel a burden – a burden but at the same time peace. Peace that goes beyond my understanding but a heaviness of the unknown. How many lives and families will be affected? What will the economic impact be and how will it ultimately affect us? All of the “experts” seem to have a different outlook on the health situation and the financial impact and timeframe. Could it be that no one really knows? Where should we go for the answers?

These past few days as I worked at my home office, I watched several signs of new life outside my window; a robin with bright colors, a finch perched just feet away, a bald eagle flew right over my house and I can almost watch the bushes and trees budding their leaves. These are all reminders that spring is here and new life is coming!

It is also the week of Easter. A story that redefined the meaning of life! Hope, Peace, Love, Joy can all be found in the Easter story regardless of the circumstances we find ourselves in. Jesus died on Good Friday and all seemed lost – even his 12 disciples thought it was over. They fled for their physical lives, were emotionally defeated and spiritually confused. BUT Easter morning came a few days later and everything changed! Over 500 witnesses saw Jesus after he rose on Easter and many wrote about it and sacrificed their lives because of their testimony. They had a new outlook – one that changed everything. Physically they had hope for life beyond what this world has to offer, emotionally they had joy and peace even when enduring suffering, and spiritually they had a rebirth knowing they had hope for eternity.

We can experience the same today in the uncertainty of our life circumstances. We may find ourselves wanting to control our circumstances or how our leaders are responding – but we will be better off working on self-control. We CAN control how we respond to events, but usually cannot control the events themselves.  How can we have contentment, faith in the future, and peace? To be content it is necessary to not fear the future, to have peace we must look for truth and to have faith we must rely on what is trustworthy. Are these even possible? Yes! The Easter story makes all this possible. We have someone who gives us a bright future, who IS truth and who has proven trustworthy. This person is found in the center of the Easter story – Jesus. He is our Way, our Truth, and our Life!

We are praying for you and your family that you will experience His peace, joy and hope this Easter weekend. And for our country and world to have physical, emotional, and financial healing. I am also looking forward to a good ham and lots of chocolate!

The CARES Act

The CARES Act is an acronym for Coronavirus Aid, Relieve, and Economic Security Act.  Below are some thoughts specific to our industry that might be helpful to you:

  • 2019 IRA Contributions: The 2019 IRA contribution deadline has been extended with the tax-filing deadline until July 15th. Make sure that you communicate with us if your contributions are intended to be for prior-year.
  • Early Withdrawal Penalty Waiver: The CARES Act also waives the 10% early distribution on distribution of up $100,000 from IRAs and plans for individuals who meet the requirements of being affected by the coronavirus. The tax would still be due on pre-tax distributions, but could be spread evenly over three years, and the funds could be repaid anytime during the three years.
  • 2020 RMDs: The Act included a waiver for required minimum distributions (RMDs) for 2020. This waiver applies to company savings plans and Traditional and Inherited IRAs. If you would like to stop your 2020 RMDs, please contact our office.
  • Charitable deductions: The Act creates an above-the-line charitable deduction for 2020 (not to exceed $300) with a cash donation to charity, this particularly useful for those using the Standard Deduction on their tax return but still give. If you itemize your deductions, the bill also modifies the AGI limitations on charitable contributions for 2020, to 100% of AGI for individuals and 25% of taxable income for corporations. The bill also increases the food contribution limits to 25%.  The prior AGI limit was 60% for individuals.  Donor-Advised Fund Limits were unchanged, so if you are desiring to maximize the individual or corporate increases, the increased giving must be directly to a qualified charitable organization.

The Bill that was passed is over 800 pages long and covers many things from stimulus, to loan programs, to one-year changes in tax laws, and more.  Please stay close to your accountants, attorneys, and bankers for applicable opportunities this Act provides.  Feel free to reach out to us if you have questions as to how this Bill impacts you and if we don’t know the answer, we’ll point you to someone who does.

If you anticipate receiving a stimulus check, it would be a good time to prayerfully consider how best to use that money since it was not in anyone’s plans as the year started.  If you haven’t been financially impacted by the COVID-19, perhaps consider extra levels of generosity to help those who have needs.

Thank you again for trusting us to walk with you on your stewardship journey.

Market Update

by Ron Bare

As mentioned in our previous blog, the Bare Wealth Advisors team believe in helping our clients make financial decisions flowing out of a comprehensive financial plan based on your values and goals. However, we do understand that the current health situation with the virus and also the implications of how this effects your financial goals is probably on your mind. With that in mind, we wanted to share a few thoughts on fear and also a few principles we believe.

Since fear levels in our country (and world) are at high levels, we thought it would be good to share some thoughts and principles related to fear and finances. I have heard that the Bible says do not fear (or be afraid) somewhere close to 365 times, one for each day. This is clearly to remind us that our nature is to fear the unknown and the circumstance we may be faced with. I was reminded in our church service this past week to read Psalms 91 (too long to type in this blog – I suggest going to the YouVersion Bible app to read). Reading this and other scripture is a great way to actively combat fear in our lives and for those we care about.

In addition, as we make financial decisions, we believe reviewing a few basic principles can be effective when we live in times of uncertainty. Here are a few to consider:

  1. God is the owner of all things, including our money (Psalm 24:1). This reminds us we are stewards and should work hard to manage what has been entrusted to us; however, we are not expected to have a crystal ball based on future events that may or may not happen.
  2. Live within your means and be content with what we have (Hebrews 13:5)
  3. Minimize the use of debt
  4. Build liquidity and have some money put back in savings for the unexpected and for income that you may need in the short term (our planning process accounts for these items)
  5. Think long term – the longer term your perspective typically will help you make better financial decisions. (Think back to the financial crisis of 2008 – 12 years ago, we have recovered well)
  6. Give generously – personally I believe this to be a very important step in coming up against fear we may have. Fear causes us to hold tight to what we have rather than have an open hand, look to help someone in need or bless a cause or mission you believe in.

In summary, one of our core values at Bare Wealth is Biblical wisdom. We believe that when we manage our lives and finances according to Biblical principles we can experience:

  1. Contentment under all economic conditions
  2. Confidence in financial decision making
  3. Maximize the use of money, our talents and time for what matters most to us

As always feel free to contact our team with questions on your plan/investments or concerns related to what is happening in our world, we care about you and your family.

Also, please pass this on to any family or friends who may benefit from reading this.

Market Update

by Ron Bare

One thing I have learned, working in the financial services industry over the past 24 years, is by having your investment decisions flow out of a comprehensive personal financial plan, based on your values and goals, is essential to making wise decisions over time. The moment you separate your investment decisions and make them independently of a comprehensive financial plan is when those decisions are made based on emotions, news events, or other items that do not point back towards your values and goals.

If you have worked with Bare Wealth for any length of time, you know we believe in planning around our client’s purpose, values and goals and letting these items drive all decision making. However, we do understand when world events cause large movements in the financial markets, feelings of concern may arise regarding how these shifts may impact your objectives. With that in mind, we do not want to be silent when events, such as the coronavirus, influence the markets with an 11% drop in one week.

In case this has caused any concern (or fear) related to life or your finances, we want to assure you that unless your goals or short-term financial needs have changed, it is best not to react to these news events. Let your financial plan have the time it needs to properly help carry out your goals.  As always, we are here to take any questions or inquiries surrounding these events. In the meantime, lets pray for the families impacted by the virus and pray that a solution would be developed to stop the spread of the disease.

Year of Vision

by Ron Bare

As mentioned in our “Yearly Update Letter,” 2020 is Bare Wealth Advisors’ Year of Vision.

At the beginning of this year, I (Ron) set some time aside to get alone with God and to focus on HIS vision for 2020.  As I did, something stirred in my heart. God helped me see that during the last two decades, He has been developing my influence… my voice… and my abilities to move towards solutions to some problems in our world.  As I wrote down the vision I felt God gave me, I closed my laptop that day and was excited to begin taking steps towards accomplishing what God had just planted in my heart.

How about you?  Have you taken time to get alone with God as this new year has begun? If not, I would encourage you to! I feel confident that as you desire to hear from and seek Him, He will begin to unfold a vision for you with the gifting’s He has developed in you.

Proverbs 29:18 says “Where there is no vision, the people perish”. Some versions of this verse replace perish with “the people cast off restraint”. Several versions of Proverbs 29:18 actually replace the word vision with “revelation” or “divine guidance” which may give us a better picture of what this actually is. What this verse is saying is that without godly vision for your life, or revelation from God, we are left to perish or “run wild”. God’s revelation is His Word!  At Bare Wealth, we have seen this to be true especially in the area of finance. Without using God’s wisdom given in His Word and without formulating a plan or vision for your finances, mistakes are more easily made. In addition, if there is no order or restraint –financial problems (too much debt, too little margin, very little impact, no contentment, etc.)– all begin to surface.

Aligning our “vision” or plans with God’s divine revelation is the ultimate goal. What we all need to ask ourselves to help us gain clarity in our vision is this question: What has God shown me and what will I do with what I have been given?

Many of us have been given much not only in the financial area of life, but also talents, relationships, education, experiences, time etc. Those who have been given much have a higher level of responsibility and accountability (Luke 12:48). With a focus on Vision in 2020, we hope to help each family we serve better answer the above questions and take steps to help you gain a clearer vision in your finances, relationships, and many other areas of your life – ultimately in your God given purpose. Here is what I believe will happen if we are successful managing our lives with a greater vision:  we will have great impact, improved relationships, increased adventure and fun, and gain eternal rewards.

Clarity in Planning

Driving into work today the classic 1972 Johnny Nash song “I Can See Clearly Now” came strolling into my mind.  It made me first break out in song and then contemplate the blessing of sight and finally consider how this year is going to be the Year of Vision at Bare Wealth Advisors.  You will hear more about our Year of Vision throughout the year but for now I simply want to focus on seeing clearly or having clarity.

Did you know that eyes are made up of 2 million working parts?  Or that your eye is the fastest muscle in your body?  I regularly take my eyes for granted and forget that my vision is one of the greatest gifts I have.  However, when I forget my glasses or get something in my eyes and lose the clarity of vision, it’s an easy reminder how critical it is to see clearly.

As a financial advisor, one of the areas we excel at is giving financial clarity to our clients.  It’s more than just wealth management and insurance products based on your age and risk tolerance.  These might provide a course but cannot provide full clarity.  Once we get a chance to walk through a full financial plan, understanding a client’s core values in addition to their financial goals and circumstances, we can provide a lot of clarity as to the path they are on and help them answer the question of “how much is enough?” in many areas of their financial lives.

We’re looking forward to 2020 and hope to see you soon!  As the Johnny Nash chorus continues, “It’s gonna be a bright (bright) bright (bright) sunshiny day”.