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Helping Christians with Sound Investment Information
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By Dr. Jin Won Choi Founder of Money Geek


"You yourselves know that these hands ministered to my necessities and to those who were with me. In all things I have shown you that by working hard in this way we must help the weak and remember the words of the Lord Jesus, how he himself said 'It is more blessed to give than to receive'" - Apostle Paul in Acts 20:34-35

When Paul went to a new city to start a ministry, he often took up tent-making to earn money. He did so in order to support himself financially, but many people think it was more than that. They think that Paul could have easily received donations, but he chose not to. Not because he was morally against receiving donations, but because he wanted to show us an example.

He wanted to be a giver, not a receiver.

As Christians, we all probably agree that we should be givers, rather than receivers in life. But as Paul shows, I believe that becoming givers require us to first take care of our own needs, since only then we would have the capacity to give to others.

Unfortunately, in this modern age, taking care of our own financial needs require more than just spending less than we earn in a given year. These days, we tend to live longer, so we need more money to fund our retirement years.

Many people dramatically underestimate just how much money they need to fund their retirement, even a modest one. A quick calculation will give us an idea.

If we assume that we retire in age 67, we might expect to live until 87. In this case, we would need to fund 20 years of retirement. Even assuming a modest withdrawal of $30,000 a year, that would mean having to withdraw $600,000 over the 20 years of retirement, and we didn’t even adjust the numbers for inflation.

Unfortunately, the average Canadian is far from prepared to face retirement. A BMO study last year revealed that the average baby boomer only has $228,000 saved up, which is some $400,000 short of what BMO thinks they need to fund their retirement. I'm not aware of any statistics on savings among Christians, but I would be surprised if the numbers differ drastically.

When we put these numbers into context, perhaps it’s no wonder that Christians don’t give as much as we should. Some statistics say that the average Christian in North America tithes only 2.5% of their income. It’s hard to give when you have unfunded needs of your own.

Yet it doesn't have to be this way. While saving up for retirement can involve making some tough choices such as deciding on which expenses to cut back on, there are other things you can do that aren’t nearly as painful, and one of them is to learn about investing.

Even a 2% difference in the rate of return of your investments can make a huge difference to your savings. If you invest $10,000 and gained at 7% per year for 35 years, you would end up with around $107,000. If you invested the same amount at 9% per year, you would end up with $204,000.

Yet the average person is a terrible investor. JP Morgan estimates that in the past 20 years, while stocks returned 8% per year and bonds returned 6% per year, the average investor only returned a paltry 2.3% per year.

There are many reasons why ordinary investors did so badly - they acted on their emotions, they paid too much in fees, etc. But all of these failings could have been avoided if they had learned just the basics of investing. Learning the basics is not hard - you only need to spend a few hours to learn them.

Instead, the unfortunate reality is that large numbers of near retirees now need our financial support. I personally think that that's why the Liberal party scored an unexpected landslide victory in Ontario's elections. By promising to introduce the Ontario Registered Pension Plan, they spoke to the needs of these near retirees.

Please don't get me wrong. I don’t resent the decision - if there is a need, we should pay our taxes to fill it. However, I do regret the fact that we need such a program.

I believe that we as Christians should strive to be different, to save enough to support ourselves so that we can give over the course of our lifetimes. By learning the basics of investing, I believe that we can significantly increase our capacity to give.

Money is one of the resources that God entrusted with while we’re on this earth. Let's be good stewards of it and learn to handle it well, so that we can imitate Paul and help those who are weak.