Investments are for a Purpose

Just as a body, though one, has many parts, but all its many parts form one body, so it is with Christ. For we were all baptized by one Spirit so as to form one body—whether Jews or Gentiles, slave or free—and we were all given the one Spirit to drink. Even so the body is not made up of one part but of many.(1 Corinthians 12: 12-14)

Mark visited my office for the third time in two months. He was slated to retire from his 35-year career at the local pharmaceutical company in December. He was not a client yet, but we had some really good discussions about his goals and his hopes for the future. 

I diagnosed the problem quickly. Seventy-five percent of his retirement was invested in his company stock; the same company he had worked at for nearly 4 decades. Clearly, there was some emotional attachment.  

He knew that he was taking a big risk to hold such a large position in one stock. But he still wanted to keep it because he “likes the dividend.” With a warning tone, I asked, “What happens when your company, the industry, or the entire market sees a downturn?”  

He was not concerned about his lack of diversification, so despite my counsel and encouragement, he continued to manage his investments himself and keep the stock. He hoped the dividend would hold up and that the stock would not tank. Thankfully, in the 9 years that have passed since, the dividend has held, although the stock has underperformed the overall market.  

He kept the stock because he liked the dividend. He was so narrowly focused on the 3.4% yield that he took unnecessary risk and almost derailed his retirement. He did not realize that each of our investments are designed to fulfill a purpose. Some for growth, some for dividends and some for stability. When they all work together, you are more likely to achieve the goals God has laid on your heart.  

We are stewards on this earth, so we should invest wisely and stay diversified. We are all part of one body with specific useful parts. Our investment portfolios should be designed the same way.

The “experts” will say you are foolish to own value stocks when they are out of favor. Why not just continue to own growth companies since they’re doing so well?

Some people will advise you to put all your eggs in one basket, and then guard that basket with your life! They are only correct if that basket is Jesus and you are guarding your relationship with him.  

Father, help me steward the funds You have given me with great care and attentiveness. They are all Yours and I want to invest them wisely.