Faith Based Investing

What is an exchange traded fund (ETF)?
Exchange traded funds (ETFs) are index-tracking funds that trade like stocks. Often referred to as a basket fund, an ETF is a collection of securities that mimics a particular index (e.g., Standard and Poor’s 500 Composite Index). The intent of the fund is to track the index.

Introducing Faith-Based ETFs
Faithshares, the first faith-based exchange-traded fund provider will open for business this summer with the rollout of five new ETFs. Headed by Tom Phillips and Garrett Stevens of T.S. Phillips Investments, the company seeks to offer ETFs that are designed to adhere to the investing principles of five major Christian denominations-Catholic, Baptist, Lutheran, Methodist and non-denominational. Here are they types of companies the funds will exlude:

* Those involved in the alcohol, tobacco, gambling, and pornography industries.

Faith-Based Investing

There are now millions of religious investors attempting to align their morals and values with their investment portfolios. Religious concerns have long been a factor in the investment process because investors have wanted to avoid companies that contradict their belief system. This began with social screens such as alcohol and tobacco and has migrated to moral issues such as pornography and abortion.

There has also been a recent movement for investors to reassess their financial priorities in light of the corporate and mutual fund scandals that have surfaced over the last ten years. People are looking for more meaning in their lives and ultimately to make a more positive difference with their investments. This has led to the desire and ability to screen for more social and moral issues.

More Investment Options

The rise in the number of faith-based mutual funds and money managers has opened the door to new avenues of investing. There also has been a surge in the level of sophistication in research available to advisors, money managers, and individual investors. As a result of this movement and awareness, millions now have the opportunity to put their money where their values are.

The appropriate starting point for any investment should include having a noble purpose as well as developing a process to maximize moral integrity. It is not just whether you should compare the harm of investing in one company vs. another company. It is more about trying to avoid the “blood money” that results when you invest in companies that are not in line with your beliefs. If you participate through your investment dollars in things you do not agree with, you are still enabling that activity. More important, when you send money into a mutual fund that invests in things that are objectionable to you, your moral integrity has been compromised.

The limitations of your knowledge should not blind you to the fact that there is a moral responsibility when you invest. If you look the other way when others are doing wrong, you are still morally responsible. So how do you invest in a manner that reflects your morals and values? 

The first part of the process is to determine what is truly important to you. Is God a top priority in your life? Are you looking for balance and consistency? Doesn’t it make sense to include your faith in all areas of your life–finances included?

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Introducing the GPS Solution

You have goals for your future. Are you moving in the right direction? Is your financial plan on course? So many people today cannot answer the following questions: Where does my money go? Will I make it through the month? I want to retire–will I run out of money before I run out of life?

A Global Positioning System (GPS) is a navigational tool used worldwide. Borrowing the same initials and working on somewhat the same premise, The Faith-Based Investor, my latest book, introduces the GPS Solution. This tool, which is based on Growing, Protecting, and Sharing, will help you determine your current financial position and then navigate the world of money and investing to your desired financial destination.

The Following is an overview of the GPS Solution:

Grow: Do you know how long your money will last? Will you run out of money before you run out of life? Can you really afford to retire? How does God want you to manage the assets you have been given? The first part of the book will help you look at ways to grow your income and assets.

Protect:Sometimes knowing the questions to ask is as important as the answers. God expects us to walk by faith, but He also calls us to plan for both the feast and the famine. We live in a time of extreme volatility. This section of the book will look at prudent strategies to help you protect your income and assets.

Share: Going backward financially? Not receiving blessings? Have you stopped giving? Some people stop giving to God’s kingdom when things get tough and money gets tight. You need God to point you in the right direction, so why take Him out of the picture? The third part of the book will look at ways to share all that God has entrusted to you.

Many people do not have the education, experience, or resources to wisely manage the money God has provided. My hope is that you will begin a new quest to make wiser decisions by being better informed through the material provided in this book.

God’s way is a better way!
Every financial strategy that works has its roots in biblical principles. The Faith-Based Investor was designed for people like you. Whether you are old or young, rich or poor, this book can help you grow closer to God and be a more faithful money manager.

As you read this book, you will unlock the lessons that I have learned during my twenty years in the Christian faith and fourteen years as a financial planner. Here is a sampling of what we will cover:

Lesson One: Manage your time, skills, and finances in a way that glorifies God.
Lesson Two: Every financial plan should have purpose.
Lesson Three: Principles should always come before profits.
Lesson Four: God calls you to maximize the resources He has provided you.
Lesson Five: Find investments to grow your wealth, but don’t forget to incorporate your faith, passion, and purpose.
Lesson Six: Let your faith and not fear guide your moneymaking decisions.
Lesson Seven: Position your finances to succeed in any environment.
Lesson Eight: Proper insurance planning does not mean you lack faith in God.
Lesson Nine: Giving advances God’s creation.
Lesson Ten: Leave a lasting legacy.

In the writing of this book I was led to interview more than one hundred faith-based investors: pastors, teachers, financial advisors, entrepreneurs, business leaders, authors, influential bloggers, and others who had a meaningful story to tell. I hope their recounted diverse experiences will help make this book as much a joy for you to read as it was for me to write.

Special Throgh March

For a limited time (through the end of March), when you buy The Faith-Based Investor, you also get a hard copy of The Faith-Based Millionaire absolutely FREE ($19.99 value) at www.jayperoni.com.

The Question Few Want to Answer
This week at my church, we were asked, “Do you hate evil?” For many people, they never answer this question. It is uncomfortable! In a world where evil is ignored, denied, and even tolerated,many sit on the sidelines and do nothing to combat evil. So I ask you: “Do you hate evil?” In Matthew 24:12 (New Century Version), it says, “There will be more and more evil in the world, so most people will stop showing their love for each other.” What does God want us to do with evil?

Here are four responses:

1) Don’t deny evil exists, but face it!
“and have no fellowship with the unfruitful works of darkness, but rather even reprove them” (Ephesians 5:11 American Standard Version)

2) Don’t accept evil, hate it!
“People who love the Lord hate evil.” (Psalm 97:10 New Century Version)

3) Don’t fear evil, resist it!
“Even though I walk through the valley of the shadow of death, I will fear no evil, for you are with me.” (Psalm 23:4 New International Version)

4.) Don’t return evil, overcome it!
“Do not be overcome by evil, but overcome evil with good.” (Romans 12:21 New International Version)

Are You Supporting Evil?
Edmund Burke, Irish statesman said it best, “”All that is necessary for the triumph of evil is for good men to do nothing.” I talk a lot about faith-based investing in an effort to expose the evil that many publicly traded companies are promoting. Many Christ-followers buy products, buy stocks, and say nothing about participating in that which God clearly opposes. Here are a few examples:

Abortion
LifePoint Hospital (symbol LPNT): Perform surgical abortions. Top mutual fund companies owning Lifepoint: Blackrock, T Rowe Price, Fidelity, and Vanguard

Pfizer (symbol PFE): Abortion manufacturer: Pfizer manufactures Prostin E2, a dinoprostone (prostaglandin) vaginal suppository and Hemabate, a carboprost (oxytocic) administered by intramuscular injection. Both are used for the termination of pregnancy. Top fund owners include Vanguard, Fidelity, and Franklin

Pornography
Take Two Interactive Software (symbol TTWO): Produce sexually explicit video games. Take-Two Interactive Software’s Rockstar Games makes the video game, “Grand Theft Auto: San Andreas” which received the Entertainment Software Rating Board’s rating of Adult Only (18+) for blood and gore, intense violence, nudity, strong language, strong sexual content, and use of drugs. This stock is owned by several fund companies including Oppenheimer, Legg Mason, and Vanguard.

Playboy Enterprises (symbol PLA): Pornography distribution. Playboy is a leading producer of adult videos, TV programming, and sexually explicit materials. Playboy is owned by numerous fund companies including Blackrock, Fidelity, Wells Fargo, and ING.

Homosexuality
General Electric (Symbol GE): active promoter of the homosexual lifestyle. According to the Gay & Lesbian Alliance Against Defamation (GLAAD), NBC’s 2007-2008 TV season featured network characters who are gay, lesbian, bisexual or transgender. Bravo, part of GE’s NBC Universal, operates OutzoneTV, a broadband online gay/lesbian site. Content includes video, news, fashion, blogs, photos, community and chat. GE is owned by several leading fund families including American Funds, Vanguard, Dodge & Cox, and Fidelity.

Time Warner (Symbol TWX): Time Warner Cable offers homosexual programming on its LOGO and here!tv in the New York City (Manhatten) market. Time Warner boasts over 40 regular homosexual characters depicted on 21 scripted shows on cable channels including HBO, Showtime and FX. Time Warner is owned by many top fund companies including American Funds, Dodge & Cox, and Vanguard

Embryonic Stem Cell Research
GlaxoSmithKlein (symbol GSK): GSK believes that human embryonic stem cells (HESCs) have a promising place in medical research and drug discovery. GSK makes use of such cells in its own research and in collaboration with academic institutions or other external partners. GlaxoSmithKlein is owned by several fund companies including Allianz, Dodge & Cox, and Vanguard

Johnson & Johnson (Symbol JNJ): Johnson & Johnson’s subsidiary Johnson & Johnson Development Corporation is an investor in Novocell, Inc. “Novocell uses directed differentiation to engineer human embryonic stem cells (hESCs) and generate therapeutic cell types. Novocell is a world leader and the first company to engineer hESCs into definitive endoderm, the gatekeeper cells that differentiate into the pancreas, liver and other cells, tissues and organs. JNJ is owned by several top fund companies including Vanguard, Fidelity, and American Funds

No Company is Perfect!
No company is free from sin as we all fall short of God’s glory. However, some companies are worse than others. Just like environmental ratings, there are moral ratings based on a company’s moral behaviors. If you need help finding faith-based options, send me an email at info@jayperoni.com.

Faith-based investing or biblically responsible investing is about honoring God with our investments.  Take part in a movement focused on exposing evil and find alternatives that are in line with your faith.  With millions of Christians getting involved in the movement, we can finally have our say on Wall Street.

The bear will eat you alive if you let him!

According to investorwords.com, a bear market is defined as “a prolonged period in which investment prices fall, accompanied by widespread pessimism.” There is no denying we are in such a market. So the big question is: what do you do? Do you pack it in? Do you stay the course? Well here are 12 principles to help you survive what may end up being a prolonged bear market. Set your targets on defeating the bear and you can not only survive but also thrive in this environment!

1. Trust God for the outcome. Every financial plan should have a purpose! Every plan should include your faith in God. www.jayperoni.com was created to help you focus on both your faith and finances. Is God the center of your plan?

2. Protect your capital. The first rule is don’t lose money. Rule two is never violate rule one! Do you realize if you lose 50% of your portfolio, you need to double your money to get back to even? How you protect your assets is as important as how you grow your money. Are you protecting your assets?

3. Use common sense. Many stick their heads in the sand and do nothing or worse – invest in things that fall during troubled economic times. Do you know which assets you should avoid and which ones are more defensive in down markets?

4. Do NOT rely on the government to turn the economy around or save the markets. Individuals and businesses drive the economy and markets. The government can throw all the money they want at the economy and believe me Obama and the Democrats are spending like drunken sailors. However, this will make little difference if people do not spend money. Do you know how to profit from this riduculous spending?

5. Invest in liquid investments! Use investment vehicles that allow you to get in or out at a moment’s notice and have enough trading volume that you don’t get stuck holding the short end of the stick. Do you know ways to maintain liquidity and still make attractive profits?

6. Maintain flexibility. This is critical! You must main flexibility in your thinking and potential investment opportunities. Things change all the time. Does your plan allow flexibility to take advantge of short term trends and repositioning for longer term gains?

7. Seek investments that move independently of stocks and bonds. These are often called alternative investments. These investments provide a buffer during down times. Do you own such assets?

8. Hedge your bets. Use investments that rise when stocks fall. There are investments that profit when the stock market falls. These should be a part of nearly every plan. Are they a part of yours?

9. Diversify, diversify, diversify! You will need a good mix of stocks, bonds, cash, and alternative investments. Using multiple asset classes helps diversify and balance your portfolio while reducing risk and increasing your profit potential. Do you know your proper allocation?

10. Be swift to act! be ready to cut losses and take profits when neccessary. Have a target in mind: the price you are willing to sell at in a best and worst case scenario. For example, I will sell when this goes up 100% or goes down 20%. Do you have reasonable expectations and an exit strategy for your investment plan?

11. Look for bargains. Buy low and sell high is the nameof the game. Look for buying opportunities. Buy assets at a deep discount and sell them when they reach a premium price. Do you know how to value assets and know if you’re getting a bargain?

12. Lastly, don’t go it alone! Rely on trusted counsel – someone who knows how to navigate up and down markets. Plans fail for a lack of wise counsel, but with great council your plans can succeed! Do you have a competent advisor who is looking at your best interests and keeping your faith as the center of your plan?

So where do you go from here?
In the coming months I will be developing more resources to help you navigate these challenging markets and recover from your losses. Together we can fight and take back what has been lost. Don’t give up! With a plan, a set of proven strategies, and good, wise counsel, you can get back on course and reach your goals!

If you would like to find answers to any of these questions, please do not hesistate to drop me a line at info@jayperoni.com

Here is my latest article at www.christianpf.com:

READ HERE

WORKING OUT A BUDGET WHEN YOU’RE UNEMPLOYED

A worksheet can help you separate needs from wants.

If you’re unemployed or underemployed as a result of this recession, you’ve no doubt given some thought to budgeting. Establishing that budget is the next step.

See where your money goes. You know the amount of your mortgage or rent payment, but do you know how much you’re spending on food, gas, entertainment, or clothing? This is how hard-earned or long-saved money leaks away.

Track every buck. That’s right: for a month or a week, make a note of where every dollar you spend goes. That’s every dollar that leaves your bank account. Specify every expense you can. (Don’t forget to include the fractional cost of your annual expenses per month or per week.)

Where the savings are. You might be relieved to see how much you can save per month if you cut back in five areas or creature comforts – comforts you might be quite comfortable without.

1) Eating out. A morning coffee … a fast-food lunch … a takeout meal or dinner in a restaurant … what does this all add up to? Possibly $20-25 a day, 5-7 days a week. Cutting back on some or all of this could save you hundreds of dollars a month. While these purchases may have been habit when you worked, you can avoid or limit them now.

2) Entertainment. This means movies, concerts, plays, and other social events and amusements. You don’t have to deprive yourself altogether here, but consider how expensive some of these costs (concert and theatre tickets) can be. You might easily save $100 or more per month.

3) Autos. You can find families in this country that own three or four cars. (Three or four SUVs, even.) Gas may be cheaper at the moment, but auto repairs are never cheap. What if you sold a car and cut back to one car? It might require a little rescheduling on the part of your spouse or family, but you could gain some cash and lose some expenses (and possibly some repair bills you would otherwise pay down the road).

4 & 5) Cable and Internet service. Do you really need a high-speed connection? Do you need 68 channels? These are other areas where you can cut back and save big.

A worksheet. Here is a worksheet that can help you keep track of your non-deductible expenses per month. (Some expenses are often deductible, such as charitable contributions, mortgage interest, alimony, and certain health and business expenses – check with your tax advisor to see what you might be able to deduct.)

Auto/Transportation

Gas ____

Service/Repair Costs ____

Bus/train fare ____

Clothing

Clothing purchases ____

Laundry/dry cleaning ____

Daily Living

Babysitting/child care ____

Eating out ____

Groceries ____

Personal supplies ____

Allowances ____

Dues/Subscriptions

Club memberships ____

Newspaper subscription ____

Child sports expenses ____

Education

Music lessons ____

School lunches ____

Tuition ____

Other education expenses ____

Entertainment

CDs/DVDs (buy, rent) ____

Books/magazines ____

Dates ____

Hobby costs ____

Other entertainments ____

Household expenses

Furnishings ____

Appliances ____

Improvements ____

Home maintenance ____

Association dues ____

Other household expenses ____

Insurance

Auto insurance ____

Homeowner insurance ____

Life insurance ____

Rental insurance ____

Other insurance ____

Lawn care

Plant/agricultural expenses ____

Equipment expenses ____

Other lawn care expenses ____

Financial payments

Auto loan ____

Credit card payments ____

Education loans ____

Other loans ____

Bank fees ____

Postage ____

Other financial payments ____

Rent or mortgage payment ____

Utilities

Electricity ____

Gas ____

Internet ____

Heating oil/fuel ____

Telephone ____

Trash collection ____

Water/sewer ____

Other utility costs

Vacation/Travel ____

Do not stop investing. You still need to do that if at all possible. Keep contributing to the accounts poised to compound over time, so that you may use them to fund part of your retirement someday and pursue your long-term financial goals.