Sunday, July 04, 2010

An Encouragement for Southern Baptist Guidestone Participants to Pay Attention to Their Retirement Accounts

Guidestone Financial Resources is the Southern Baptist Convention's agency charged with investing and protecting retirement funds for pastors, staff members and other SBC personnel. O.S. Hawkins is the President of Guidestone and issued his annual report to the Southern Baptist Convention on June 16, 2010. Guidestone has done a great job in enhancing their website and providing additional investment products, including the 2009 launch of the Inflation Protected Bond Fund. This fund seeks to provide inflation protection and income by investing in inflation-indexed debt securities such as Treasury Inflation Protected Securities (i.e. TIPS), and is a fund worthy of consideration in the inflation years to come.

My bachelor's degree is in business, with a major in corporate finance and a minor in accounting. I trade a small amount of my short term savings in stocks and options through a personal account at Ameritrade, but I rely on Guidestone for the investing all of my retirement funds. The three year annualized return for the Guidestone funds designed for Southern Baptists who wish to simply allow the money managers at Guidestone to do their investing for them do not look good:

MyDestination 2005 has a three year annualized negative return of 1.46%
MyDestination 2015 has a three year annualized negative return of 4.16%
MyDestination 2025  has a three year annualized negative return of 4.43%
MyDestination 2035 has a three year annualized negative return of 10.19%
MyDestination 2045 has a three year annualized negative return of 11.14%

In essence, by the time you take out the average 1% investment fee charged by Guidestone, the average Southern Baptist who left his money in one of these funds has lost 2.5 to 12.5 percent of his retirement savings during the past three years. Obviously, the market performed very poorly in 2008/2009, but since the spring of 2009 until the spring of 2010, the market has increased by over 50%. Yet the annualized return for three years is still significantly negative. O.S. Hawkins, knowing that many leave the market during down times, stated during the annual report: “Those who panicked at the trough (spring 2009)… locked in their losses, but those who stayed the course have seen their account values recover. Saving for retirement is like a marathon, not a sprint." Hawkins also emphasized that while GuideStone cannot control financial markets and the global economy, it can control how its Funds perform in relation to other funds. According to industry research firm Fi360, GuideStone Funds ranked 39th out of 297 total funds in America as of March 31, 2010.

All that Hawkins said is true -- but it is not the whole truth.

It is a problem when Southern Baptists remove their retirement funds from equities when the market is "in the trough," but it is wisdom for Southern Baptists to remove their retirement funds from equities when "the market is in the palace." In other words, if a Southern Baptist pays close attention to the market, he will know when the market is overbought and due for a correction. A correction is when the market drops 10% from its previous high. We are currently in the midst of a market correction. From Dow Jones of 11,200 in April 2010 to Dow Jones 9,686 this past Friday, July 2, 2010. That is a 13% correction in two months. Last week the S&P 500 closed below 1040 (close of 1022 this past Friday) which is a key technical indicator that the S&P 500 could fall into the mid-800's within the next few months. In other words, there are signs that the market might be in a bearish stage instead of a simple correction. Nobody really knows, but if someone had been watching the signs of the market and noticed it was overbought and overpriced last April and pulled their retirement funds out of equities and placed them in bonds, their retirement savings would be enormous. That is precisely what I did.

For example, if a Southern Baptist had $100,000 of retirement in MyDestination 2025 in April 2010 when the market was over 11,000 and decided to pull those retirement funds out of MyDestination 2025 and place them all in one of the bond funds offered by Guidestone, the balance of that Southern Baptists' retirement account in July 2010 would be approximately $102,000 (with contributions). Had they left their retirement funds in MyDestination 2025 for the three months since the beginning of April 2010 to the beginning of July 2010 their retirement funds would be at $87,000.  Following the first strategy rather than the second would be a real money savings of $15,000 to the Southern Baptist who moved his money. $15,000 is a great deal of money for people with $100,000 in retirement savings. Double those savings ($30,000) for those with $200,000 in retirement funds in April 2010 following the same strategy. Triple those savings ($60,000) for those with $300,000 in retirement funds in April 2010 and followed the same strategy.

It is often argued that it is too difficult to watch the market and make decisions about moving money in an out of equity and bond funds. It is also argued that you should leave all your money in equities because your new monthly contributions buy stocks at a reduced price. Guidestone does not want anyone "timing" the market and sets restrictions for how many times you can move money into and out of their respective accounts (once a month). Nevertheless, the savings for those Southern Baptists who pay attention to their retirement accounts and invest appropriately are enormous. Guidestone is flexible enough that no Southern Baptist ought to just put their money into an account and "forget about it." You lose too much money doing it that way. If you observe market conditions closely, pull your money out of equities when you see the market beginning a correction, then when the market hits what O.S. calls "the trough," you put your money back in the market, you are taking charge of your own money and managing it wisely.

I do wish that Guidestone would examine different investment strategies that would allow people to make money in bear markets (puts, shorts, etc...), but until that happens, it is much better to pull your retirement funds out of equities and place it into bonds than to watch your money sink with the market. Wall Street used to punish companies that had too much cash and refused to invest it. Not anymore. As of today, corporations have 1.5 trillion dollars worth of cash sitting on the sidelines.   Until the corporations start investing in the market it would be wise for Southern Baptists to make sure they don't take the slide down to the trough.

In His Grace,



ml said...

Wade, excellent observations. This is one area where I think Andy Stanley's remarks bears probing. If we are really going to have a great commission resurgence then we need to ask if everything revolves around the GC and if it doesn't we should de-fund and eliminate it. Let's just be honest and say it seems silly for Southern Baptists to have a financial planning organization and spend CP money on financial planner salaries when there are excellent financial planners everywhere. How is this great commission oriented and is this essential to accomplishing the GC? I understand they do things like care for widows but they also ask for a special offering for this. Dunno, it just seems superfluous. said...


I was under the impression that no CP funds are used by Guidestone. They take 1% of managed assets in fees.

I could be wrong but that is what I thought changed about Guidestone a few years ago. said...

Guidestone does NOT receive any CP funds:

The GCR Committee report states this:

See GCRTF Report here. said...

What Southern Baptists should watch carefully are the fees charged by Guidestone.

With 9.5 BILLION under management, if those fees reach 1%, then the income for Guidestone will be 90 million.

It would be very interesting to see the Executive Pay Packages of Guidestone President O.S. Hawkins and other senior officers, the annual budget for trustee meetings and conferences, annual bonuses, and the business expense accounts of those who serve Southern Baptists.

Is there anyone who has that information or could tell me where I might find that online? I have been unable to find those documents.

I would not argue for a lower salary (necessarily).

I would argue that since Southern Baptists are the shareholders and we know our returns are negative for the past three years, then Executive pay should be a reflection of performance.

Anonymous said...

Does that same principle hold true for pastors whose churches are not growing or declining? said...

I would imagine that if churches do not meet their budgets, one of the first things that is reduced is pastor compensation. That's not so much an observation as it is a fact.

Holyagnostic said...


Thanks for going where "angels fear to tread": money.

Timing the market (the strategy you describe for your retirement) is something that even most professionals who have the time and training cannot do very well. You have made one decision that is correct (moved out at the beginning of a correction). Now you must make another decision that is correct (moving back in when the market is through correcting).

Scholarship suggests that asset allocation tends to create higher returns than timing. It is not a strategy that most ministers. or anyone else, have the time or training to do.

Just sayin' said...


You make a good point, but I must persist. :)

I am not advocating "timing" the market as much as I am "watching" the market and taking control of your own retirement funds.

It makes no sense to keep money in equities if you know the market is moving down in a bearish correction or bear market, likewise, it makes no sense to be out of the market if the market is bullish.

That's all.

Of course, one option is to do what you suggest and allow others to provide an annualized return of negative ten percent.

:) said...


I freely admit that I could have been wrong when I took my money out of the market at 11,000, believing the market oversold and the economic data falsely supported by government intervention (home tax credits, car credits, billions of dollars of bailouts, etc...), but if I was wrong, I still make money in the bond market. It's not like you are burying the money in your back yard.

Holyagnostic said...

Asset allocation provides the ability simply to trim that asset which is out of alignment instead of moving completely out of the market. It also only requires one or two "rebalancing" events in a year.

Interest rates are at historic lows. When (not if) they begin to rise, bond funds will be decimated. Hope your next move, (and the next, and the next, and the next...) are as wise as the first.

Just sayin' said...


When interest rates rise, the equity markets should be rising as well.

If not, the new fund created by Guidestone (Inflation Protected Bond Fund) might be an option.

You are obviously making good points, and in my opinion, doing the very thing I am suggesting all SB's do.

Tom Kelley said...

Wade Burleson said...
I would imagine that if churches do not meet their budgets, one of the first things that is reduced is pastor compensation. That's not so much an observation as it is a fact.

Perhaps for some churches. I've seen churches and ministries cut positions and salaries of the lowest paid support staff (sometimes those who can least afford it) without even a mention of any cuts to pastoral or senior staff salaries. Since many large churches won't provide details of pastoral compensation these days, one might never know if their salries are cut when budgets are tight.

Good food for thought on the original post, though. I have a small amount in a Guidestone account that I've been thinking of rolling over into another account, and I wish I'd done it back in April.


Lydia said...

Way off topic:

My friend Cindy contacted me a few weeks ago about McFarland's book, Quivering Daughters, which was just released. She wrote about your blurb of the book. Great blurb:

“Read it and weep. Read it and think. Read it and quiver no more.”

Cindy wrote the Afterward.

She blogged about the book, here.

Anonymous said...

GuideStone, like other sellers of traditional long-only, buy-and-hold equity funds, has a difficult task these days.

They take their fiduciary duty seriously, of course. But if/since their income is derived each fund's fee structure, they have a conflict of interest because little revenue is generated when participants move to cash (money market).

So typcially, conservative advisors believe and advocate "the old ways are the best ways." Meaning: buy and hold, and let us collect a fee (no matter what happens).

Just as in medicine, financial advice can be tainted by the fear of lawsuits or complaints, especially if the advice departs from the herd (conventional wisdom)and things don't go well.

We are not living in conventional times, however. Yes, broad trends in the market can be discerned. And right now, they are all down.

Stewardship requires both understanding the times and taking the risk of liberated thinking.

GuideStone's purpose is to professionally manage a pastor's retirement account so that he doesn't have to keep his mind on the market. He can focus on more important things.

But doesn't buying into a declining market defies common sense?

There is a time to go long, a time to go short, and a time to go fishing!

GuideStone could better fulfill its mission if it had a few more tools in the box that could take advantage of the current environment.

But like the Convention as a whole, conventional thinking will probably prevail--to everyone's detriment. said...


A really astute comment.

Wish you would sign your name.


Anonymous said...

Those who stayed in Enron when Baptist layman Kenneth Lay told them to "stay the course" lost everything.

He also suggested buying more Enron when the price was down 40% (and he had sold a large portion of his own stock).

The film, The Smartest Guys in the Room, is available online and is very instructive and full of good sermon illustrations.

One thing is true: The trend is your friend. And the trend is down.

Anonymous said...

I was waiting to see who we be next to receive a Burleson Bomb. Had no idea it would be O.S. Hawkins. Hey, if it at first you don't succeed, try again and again and again......

Anonymous said...

My wife and I have lost over $20,000 dollars the past 3 months alone. We are IMB missionaries with over 25 years service and thought that Guide Stone looked out better. We don't know about investments and felt that they knew better than what they have been doing. They are suppose to be the experts.

Over the years their answer is always "it is all paper and you will get it back in time." I have been told that at least 3 times when I question their strategies with our monies. It is difficult to loose so much money so quickly after putting in for so long.

What is the answer??

Thank you for this post. said...

On the contrary anonymous, I have the utmost respect for O.S. Hawkins and consider him a good friend of the family.

I am asking the question about executive compensation at Guidestone no matter the person who sits in the chair. Contrary to what you seem to imply (anonymously), all things are not personal. Until we get to the point where people can ask solid questions in the SBC without loyalty questioned we will be an average or below average evangelical Convention. said...

IMB Missionary,

There are no easy answers.

The truth is, you WILL eventually get it back WHEN the market goes up. The question is why do you watch your money go down when the market goes down, when you have been given flexibility by Guidestone to move your money into different funds that protect your assets from equity (stock market) corrections and bear markets?

Jeff said...

Older investors would be better off trying to time the market since they do not have time to recover their losses.

Younger investors, however, are better off buying and holding. Right now is a golden opportunity for younger investors to buy stocks at lower prices. I graduated from seminary in 1998, and for the first 9 years I was working I was mostly buying overpriced stocks. Now, stocks are cheap and getting cheaper.

If you look at history, you will see that the stock market has gone through 15-20 year cycles of bull and bear markets (bull in the 1920s, bear from 1929 to 1942, bull from 1942 to 1966, bear from 1966 to 1982, bull from 1982 to 2000, and bear from 2000 to the present). Smart investors buy up lots of cheap stocks during the 15-20 year bear markets and then sell during the peak of the bull markets. The stock market performed terribly in the 1970s, but if somebody practiced a buy-and-hold strategy throughout that decade, they would made a fortune during the 1980s and 1990s. said...


A good word.

The question is WHEN to buy cheap stocks, not if.

It is possible that the market will go down to 8,500 sometime in the next few months. I will be watching very, very closely and when DOW 9,000 is crossed going south I will be nimble and quick. That's the advantage of getting out at DOW 11,000. You can watch the DOW for a little while to make sure the bulls have actually returned rather wrongly reinvesting during a mild rally of a general bear market.

If I had a guess, it would be DOW 8,500 before the turn around.

I'm looking for news of corporate mergers as strong companies buy weak ones, paying close attention to the housing, retail and oil supply data, and will get back in the market when everybody else seems to be absolutely despairing. said...

To the IMB Missionary above (again),

Hang on and your investments WILL return to previous levels. What I am advocating may not be feasible for you.

If you have lost $20,000 in the last three months, and I am correct in my scenario of DOW possibly being at 8,500 in the near future, you will lose another $20,000 before it goes back up.

If you panic at 8,500 you will be doing exactly what O.S. Hawkins warned against. You will be exiting "in the trough" and you will lock in your $40,000 losses.

Therefore, I would suggest since you are unable to pay as close attention to your retirement and make changes as needed, you are probably better off leaving it in the roller coaster ride that has become Guidestone.

True money managers (and I'm not convinced Guidestone can be called money "managers") would be paid a percentage of "profits" and would be granted the ability to short stocks, protect investments with options, and do other investment strategies that are not in Guidestone's tool box.

Jeff said...

In addition to the fact that much research suggests that a buy-and-hold strategy works better than a market timing strategy, I think that a buy-and-hold strategy is a better use of my time. While I want to be a good steward of my personal finances, I don't want to spend too much time on my personal finances. A buy-and-hold strategy allows me to ignore what is going on in the stock market, while a market-timing strategy commits me spending a lot of time every day studying what is currently happening. As a pastor, I want to spend a lot of undistracted time in the Word and in prayer. I want to read a lot of classic books, and spend time visiting people and with my family (and waste some time commenting on blogs!). I don't want to feel like I have to spend a lot of time every day studying the stock market. said...


Another good thought.

I multi-task fairly easily.


Stefan said...

You can always file a form with the IRS to request a copy of the Form 990 that all non-profit organizations must file.

The report must list the compensation of all the directors and the number of staff members receiving more than 50,000 in compensation.

Lydia said...

Try this for Guidestone 990 if you have the right info to input

Doug Pittman said...

Doug brought out the fact that many of the companies Guidestone were invested in were heavily loaded toward sin companies. Ya know, Stuff such as alcohol, PORN, etc.,

It is amazing that a S B C organization preaches against these sins, but looks to them for a " retirement"

Anonymous said...

Investing in the market when share values are low but the market is turning worked well for a congregation I served some years ago. The church put about $300,000 on deposit with a state Baptist foundation in March of that year when the market was down but turning; in December of the same year, the congregation received from the foundation (at the church's request) $65,000 the principle had earned in interest. I warned the congregation's finance committee not to anticipate a similar result the following year, but the initial deposit has earned an equal amount in interest over the years since (but not during the past couple of years).

Anonymous said...

Can view copies of nonprofits' Form 990s at if register as a user. But in seeking GuideStone's there, no info is provided. Churches are not required for the IRS to file Form 990s; is GuideStone---as is claimed by SWBTS, readers here know---also considered a "church"?

Steven Stark said...

"I am not advocating "timing" the market as much as I am "watching" the market and taking control of your own retirement funds."

I don't see a difference here. A good educated guess is still a guess. But that is what investing is I suppose, so if you can tolerate the risk, then good for you!

I am wondering if you have a certain amount you will buy back in at, if your current prediction of anticipated lows do not come to fruition? I think your guess seems quite reasonable, but there is a large degree of indeterminacy in markets.

I think Jeff is right that a slow, dollar-cost averaging strategy is probably the best for those with a long time horizon.


I certainly hope that a bit of inflation enters the picture again, as that would mean the economy is recovering. There may not be a huge spike, however, unless there is a supply-side shock (oil prices or something).

Government spending has helped to mitigate the trillions and trillions of dollars which disappeared off the books as the housing and stock market collapsed. This has prevented deflation, but I am not sure that inflation is a worry right now.

But how knows?

Anonymous said...

Pastors: borrow from your GuideStone account for housing-related expenses (remodel, add-on, etc.); pay back at a fixed rate when unit values are low = buy more units than owned previously = more units owned when market turns and helps with future retirement; get the tax-deductible benefit of housing-related expenses, too?? Have more marketable home to sell when housing market turns too?? said...


Great idea about borrowing for housing.

However, the payback needs to be longer than the currently allowed five years.

I wish it could be 20!

Anonymous said...

Borrowed our downpayment in 2002; still paying back---with 'ways to go.

Sure about the 5? A recent change??

Me... said...

We as a church in a depressed community have been hit hard with less finances being given. I personally took a 10% reduction (just over 6000.00) in my compensation package. Except for the treasurer, no one was informed until recently as we began working on next years budget. If I need to take more this year due to budget constraints, I will cut my annuity. cutting back this past year has meant we live check to check. God has been good. I am not complaining but retirement, for now, is money I am willing to let go of. said...


It could be a recent change, or there could be an age requirment (62 years of age). I don't know.

Wade said...

Anonymous Pastor,

A good reminder that having treasures in heaven is far more important than any treasures in a retirement account.

Anonymous said...


If congregation now pays medical insurance premiums for you/family AND you/family is/are relatively healthy (never/seldom meet policy deductible), change policy in 2011 to high catastrophic plan---saving $thousands for the church---but with printed/agreed-upon provision that congregation will help financially if you/family meets deductible; risky for you/family, but---unless dire emergency conditions suddently arise---could be a way not to take a loss in take-salary, but still help congregation financially (if several staff members are covered and have comparable plans, move all to catastrophic plans but with similar provisions)??

Request raises in non-taxable ways.

Anonymous said...

This year, the salaries of all of our church staff members (I am minister of education; 5+ years on staff) were frozen at 2009 levels due to national economics and anticipated receipts.

In 2009, I requested part of the raise proposed for me to be re-directed to that of another minister on staff, who has served in ministry almost as long as me and on staff 2 years longer but still hadn't reached $50,000 annually. The personnel committee declined my suggestion (the senior pastor talked to me about the offer, but didn't make a similar one; I said, "It's what leaders do---solve problems and move the organization forward!"), but proposed enough to increase the music minister's salary to $50,000 (so, a "win," I think). Also, due to the economic conditions, I've proposed money-saving changes to the health insurance policy provided for my family; the first one was accepted (saved the church a LOT of money---which was directed to other personnel), but the second one was declined (the committee didn't feel good about doing it twice in a row; can offer this only so many times personally, too.). The result: in 2009, the value of my salary package increased a total of $400 for the year (senior pastor's with no similar offer: + $8000, including a SECA offset---which makes no sense; music minister: + $23,000 due to health insurance needs; etc.)

It's only money.

Anonymous said...

off topic (sort of)

have problem, need advice

son given family money to use as 'down-payment' on a condo in CA three years ago.

purchase price $360,000

real estate market crashes
condos in complex now selling 200 K

A. should son 'short-sell' (he kind of thinks this is not an ethical option)

B. should son rent out property when deployed or tranferred (military),
and hold on to it until economy and real estate market rallies ???

C. should mom buy condo from son and assume mortgage, as it was mom's idea to 'invest' in real estate rather than to pay rent for four years . . . (this seems like the right thing to do to 'mom', but son resists the idea, as is trying to be honorable)

Any advice is welcomed.
Trying to do 'the right thing' here.

Ramesh said...

If the value of the condo is less than the mortgage, I would strongly encourage to return the mortgage back to the bank, losing the condo.

I understand lot of Christians think this is un-ethical. But this is part of doing business.

All the below links are from NYT:

Walk Away From Your Mortgage!

Underwater, but Will They Leave the Pool?

No Help in Sight, More Homeowners Walk Away

Owners Stop Paying Mortgages, and Stop Fretting

Michael said...

Anonymous wrote: But if/since their income is derived each fund's fee structure, they have a conflict of interest because little revenue is generated when participants move to cash (money market).

True, unless they manage the money market used for going to cash. If so, it's in their best financial interest that you go to cash in a down market, thus, preserving assets under management from which they derive their fees.

To those who think it's "timing" the market. No, it's "responding" to the market. "Timing" tries to predict where the market is going. "Responding" is acting in response to what is.

However, yes, there was benefit in getting out of the market, but one might have just as easily gotten out of the market, only for the market to turn up, and then they would have missed the gains. But in this market, where there are short cycles, one would probably do better not following the trend but being a contrarian investor.

Finally, a bit of wisdom; if you can reduce the volatility in your portfolio, it would benefit you. If one loses 10%, he has to earn 11% to break even. If he loses 25%, he has to earn 33% to break even.
Someone who loses 50% one year and earns 50% the next year has an average return of 0%, but is still down 25%. But, if he is down 15% in one year and earns 15% the next year, he still has an average return of 0%, but is only down 2.5%instead of 25%. Watching the downside matters.

Jeff said...

If a pastor owns his house, one of the best investment opportunities he has is to make extra mortgage payments, since he gets to deduct every cent of these extra payments as housing allowance. He just needs to make sure that his church sets his housing allowance high enough to account for the extra payments. Depending on what tax bracket that portion of the pastor's income is in, the pastor will in effect end up making 15-25 % off of this "investment."

Holyagnostic said...

Mark Twain's investment advice was to buy stocks that go up. If they don't go up, don't buy them. :)

Just sayin'

Anonymous said...

8:29: . . . And establish the value of those extra house payments officially in advance of (not retroactively to) making any of them, in order to deduct the total of each one each year

hopelesslyhuman said...
This comment has been removed by the author.
Michael said...

Jeff and Anonymous:

You would be incorrect if you think you can deduct extra payments to your mortgage as housing allowance. The code allows for pastors to deduct the LESSER of what amount you set as the limit for the allowance, the actual expenses, or the fair rental value of your house. There would rarely be a case where the fair rental value of the house would be more than what someone would pay for a mortgage plus expenses utilities, etc. However, there are plenty of dishonest pastors who abuse the system because of their greed or ignorance. I hope you don't fall into this category.

Michael said...

Jeff and Anonymous:

The housing allowance allows you to deduct the LESSER of the allowance, actual expenses, or fair rental value. You would be hard-pressed to make extra payments and claim that the fair rental value is more. So, in most cases, you would not be able to deduct the extra payments as housing allowance.

Jeff said...


I think that you are mistaken. I have never seen anything that says that the pastor cannot include extra principal payments as part of his housing allowance. The pastor just has to make sure that the church votes for a high enough housing allowance to account for the extra principal payments. Basically, nearly all expenses related to the pastor's primary residence can be part of the housing allowance. When a pastor is setting his housing allowance with his budget committee, he should always set the allowance way too high. It is up to the pastor to document the expenses, and he can only take for his housing allowance what he can document.

Anonymous said...


I will take back what I said. Upon further research, it appears that you are right - that pastor can only take for housing allowance up to the fair rental value of the home plus utilities.

Jeff said...

I meant to have my name "Jeff" on that last comment that acknowledged Michael was right.

Anonymous said...

I just have to ask why a great preacher like O.S. Hawkins left the ministry to take a step down to run this outfit. I simply have never been able to believe it.

Anonymous said...

I agree with you Wade, one should be able to question things in evangelical life, that's why I was surprised when "Pastor Michael" asked you about your personal testimony and you never gave a straight answer. Hmmmm....

Michael said...


Thanks for your follow-up and for looking into this issue. I hope that helps others.

In addition, the code also does not allow a pastor who has paid off his mortgage, to deduct as part of the housing allowance payments on debt secured by his house. For instance, I believe my former pastor paid off his house, got a home equity line, used it to pay a down payment for his daughter's new house. I'm betting he deducted it as housing allowance, but he's not allowed to.

Finally, I agree that it makes sense to set a high limit on the allowance because you do want to be able to deduct everything possible, including furniture, which is allowable. But, I also believe that sometimes, we should limit it. Since my former pastor had paid off his house, there was no way he was going to reach the amount allowed. I believe our church needed to lower the amount to a reasonable amount for accountability sake. We do not want to be partly responsible for allowing a temptation for the pastor to claim more than he legally could, if he had some integrity issues; make no provision for the flesh in regard to its lusts.

Craig Dunning said...


If the pastor secures additional debt against his home prior to paying off his mortgage, would he be able to include those costs in his housing allowance?

In other words, is the timing of that additional debt an important consideration?

Also, if a pastor has paid his mortgage off, can he continue to deduct the fair rental value of his home in his housing allowance?

Finally, are you a professional in the field of pastor's finances? If not, can you recommend someone who is?

Anonymous said...

I started putting money away with Guidestone at my first church in 2001. I always bought into the "buy and hold" and "just ride it out" theories. Just looked at my account, I would actually be a about $1000 better off if I had put the money in a coffee can!

The only thing that keeps me with Guidestone is the death benefit protection.

Gene S said...

Fascinating string of comments---I wonder if the disciples had such???

What concerns me is that too many are willing to put up with the change in Southern Baptist life because they count their Guidestone values more than the value of staying true to the Founding Fathers of the SBC.

When the average investor in America has lost about 40% over the last 3 years, we ought to be on a moral crusade to send the defrauding tyrants of Wall Street to the Federal Pen where violators of Securities Rules are supposed to go!!!

I assume you all know every Corporation has the legal right to keep 2 sets of books: one for the IRS and another for the investor.

Guess which one looks rosy and which one shows doom and gloom.

Just as little realistic input from one with a Series 6 Securities License and a Life Underwriter Training Councel Fellow (LUTCF) degree.

Michael said...


I think I left out one important detail; a minister can deduct mortgage expenses from an equity line/second mortgage, etc. if he uses it for his home. My former pastor, having paid off his house, would not be able to deduct mortgage expenses, if he took out an equity line on his home and paid for his daughter's down payment on her home.

Regarding whether a pastor can deduct the fair rental value - remember, it is the LESSER of the amount allowed by the church, actual expenses, fair rental value, or what is reasonable compensation. If actual expenses are lower, than he can't deduct the fair rental value.

I am not a tax professional, I manage investments. I don't know anyone who specializes in pastors' finances.


Guidestone is not the culprit, it's the buy and hold philosophy that did you in.


The average investor may have lost 40% in 2008, but not over the last 3 years. The S&P 500 index's average annual return over the last three years was -15.95%.

And yes, corporations that are on the accrual system have to convert their numbers in order to file taxes. But even their books for the accrual system are required by law to report the numbers a certain way. I don't accept your implications that all of Wall Street and corporations are dishonest.

Anonymous said...

One specialist in pastors' finances/taxes: Gene Hill (CPA, retired IRS Senior Appeals Officer, tax consultant, Texas Baptist laymen, and all-around good guy; author of "2010 Tax Guide for Churches" available from here:

Contact: (has responded readily to email inquiries from me over the years).

Holyagnostic said...


Hope you got back in yesterday.

Just sayin' said...


One day computer training a rally does not make.


That Baptist Ain't Right said...

I enjoy reading your blog, Wade, but this one is waaay off base. You're advocating "timing the market" & you admit that. Problem is that it can't be done & to suggest it can be done is irresponsible & encourages gambling with retirement resources. The only way to invest wisely is to understand the market does go down. It is supposed to go down. It has to go down. The only way investing works is to let it go down. I've been in this business for a long time & can honestly say (don't take offense) but you're saying the same thing the many others say who, frankly, make the most novice of investing mistakes. For example, comparing the rise in the S&P index to the return of a lifestyle fund is not a fair comparison because those are 2 different animals. I admire you for your courage in speaking out on many topics, but on this one, you really missed the mark entirely.

david b mclaughlin said...

I dont know much about the SBC but I know alot about retirement planning and teach on the topic regularly at work.

Timing the market is a horrible idea and you will get burned. Historically, a long term view of the market (20 years+) is going to bring you 10% return on a well diversified portfolio.

If you dont have 20 years you shouldnt expect that kind of return and you need to be looking at every aspect of your financial situation.

With the point that everyone should pay attention to their retirement accounts I heartily agree. But I fear some interpret that as moving money around all the time. Remember, when it's low and you move it, you lock in your loss.


Bob Cleveland said...

When I retired in early 2008, I talked to my Merrill Lynch representative. We agreed that I didn't need to have that first dollar, of our Simple Plan, in a market-based security. So we took it all out, and put it in 5 & 5-1/2% annuities. Thanks to that move, brought about by simply watching the market and making simple decisions, our total retirement account is worth more today than it was that day in February 2008, owing to the fact that we didn't have to take anything out last year, and the RMD for 2008 was less than our interest.

Like you said .. we just need to keep up with this, just like we do our finances and our health.

Gene Scarborough said...


You are blessed with a good advisor. The sad thing is that annuities have low comissions and many advisors avoid them over getting more money with securities sales.

There is a rule none of us should ever forget: the higher the rate the greater the risk.

Anyone getting over age 55 should be moving to bonds and annuities over high risk securities. You just don't have enough time to recover, should the market go south.

Anonymous said...

The ship is sinking. It won't matter if your money is in stocks, bonds or annuities.
Its all paper money , and it's just like moving the chairs on the Titanic. It will be all gone in just a short time. So get out of debt, now, and focus on those around you.

Holyagnostic said...

Tossed into the darkness of Wade's blog sabbatical, probably never to be read, is a quote in Marketwatch from a pro who prefers asset allocation rather than timing.

"Ted Aronson's firm, AJO Partners, manages $17 billion of institutional assets. His Lazy Portfolio is his family's taxable portfolio. It does well even though not in a tax-free pension fund.

He gave me a great answer when I asked him once about selling when he sees a bear coming: For two big reasons Aronson would 'hold tight. The good include my faith in capitalism and its ability to weather a storm, even one of biblical proportions. The bad reason is, I have no faith in my ability to time this sort of thing. Even if I got out in time, I probably wouldn't be able to correctly time getting back in!'"

Holy repeats, if these guys admit the inability to time, a busy preacher and denominational gadfly :) may need to reconsider advising others to take the risks he is willing to take.

Just reportin' and sayin'

Holyagnostic said...

With the advantage of hindsight (something never available to the market timer), we can now see that the perfect "time" to have gotten back into stocks after moving to bonds at the end of April would have been the Friday before this article was written. Result, using the Dow as the measurement stick, would have been a nice 13.8% rate of return over 5 1/2 months.

Just reportin'

Mark said...

My biggest complaint with Guidestone is their excessively high fees (mostly above 1%) and no low-cost index funds. Their "Guidestone Equity Index" GEQZX which they benchmark against the S&P 500 (and lose every year) is expensed at 0.49%. Outrageous prices for their "managed funds" which don't even appear to be really managed.

Anonymous said...

Agree with other posts here. Guidestone is charging, seemingly way too high of fees' for sloppy performance...too bad. I'm getting away from them as soon as I can and going with Vanguard. esp while I'm young.