Of all the many aspects of managing money, investing is arguably the most difficult. It can be intimidating and confusing. When the market falls, scary losses can pile up quickly. When it zooms, it can feel like everyone — everyone, that is, except you — is getting rich quickly. Is it even wise to invest in the stock market, or is that a form of gambling? I’ll do my best to simplify the topic over the next few posts.
However, before getting to the how-to’s of investing, let’s take a step back and look at why to invest.
As Christ-followers, we need to balance the truth that there is nothing inherently unbiblical about wealth and yet there are warnings about making it too much of a focus.
“A faithful person will be richly blessed, but one eager to get rich will not go unpunished.” – Proverbs 28:20
And there are cautions against finding our security in wealth.
“Command those who are rich in this present world not to be arrogant nor to put their hope in wealth, which is so uncertain, but to put their hope in God, who richly provides us with everything for our enjoyment.” – 1 Timothy 6:17
So, our goal with investing isn’t to build wealth for the sake of building wealth. Instead, building wealth can be a means to important biblical ends, such as providing for our family.
“Anyone who does not provide for their relatives, and especially for their own household, has denied the faith and is worse than an unbeliever.” 1 Timothy 5:8
Today, the mandate to provide for our families, especially after we retire, has become more challenging than ever.
Is retirement even biblical?
Retirement is mentioned a grand total of just once in the Bible, and only in reference to Levitical priests (see Numbers 8:23-26). Assuming that’s not your line of work, is retirement something you should be striving for?
While our culture’s view of retirement as an extended time of leisure is not biblical, planning for retirement is an essential part of good stewardship.
That may sound like a contradiction, but the fact is that retiring from full-time work at some point is very likely to be a reality for most of us, whether due to our own declining health, the need to care for a loved one in our later years, or because God redirects us toward more volunteer work
So, while it’s healthy from a vocational, spiritual, and emotional perspective to plan to continue working in later life, it can be dangerous to count on it from a financial perspective. We simply may not be able to.
To get there, invest
Because of longer lifespans and the disappearance of traditional pensions, we will all probably need a fairly substantial nest egg to live on in our later years
Consider this: If you build a retirement portfolio of $500,000 and you follow common financial planning advice that you can withdraw 4% per year to live on (adjusted each year for inflation), that’s only $20,000. Social Security should supplement that to some degree, but you can easily see the need to build a decent-size nest egg in order to provide for your family in later life.
You can’t get there with a bank savings account paying an interest rate that’s lower than the inflation rate. But you can get there with the stock market.
Next week, we’ll look at some of the specific how-to’s of investing within a biblically-informed framework.
Take it to heart: “So whether you eat or drink or whatever you do, do it all for the glory of God.” – 1 Corinthians 10:31
Take action: Take a few minutes to reflect on why you’re investing. What’s your motivation?
Read more: Three Essential Questions About Investing