I was asked to speak at a financial conference in 1994 that was hosted by a well-known Christian TV personality. All in all, there were nine financial speakers invited, including myself. All eight of the other speakers preached good, old-fashioned gloom and doom the entire weekend. Some of them brought sophisticated graphs and charts; others were folksier, sharing funny anecdotes. One even brought a tennis racket up on stage with him as part of his presentation. I found it so odd that eight out of nine speakers would be so negative and so pessimistic about the future of the stock market. This was not at all a coincidence or something in the water that we were drinking. Rather, I believe that these people were handpicked because their views were consistent with the outlook of the host of the event.

I can assure you that it was probably not very difficult to come up with eight financial speakers within Christian circles that were pessimistic about the future of the economy. I am convinced to this day that the host did not know about my optimistic outlook or I certainly would not have been invited. One thing is for sure: pessimism breeds pessimism. My presentation to this audience of over 1,000 was that no one can really predict the future of the economy and, consequently, the best we can do is place our confidence in the long-term performance record of the stock market. "If you are a long-term investor, your best course of action is to keep depositing your money into the stock mutual funds each month. Although there is no guarantee, over time you are likely to see the market continue on its path of averaging 11 to 12 percent a year as it has for the past 75 years," I told them.

This was not controversial; it was not unique, and it was certainly not likely to cause a mad dash of people to buy my books out in the lobby. It was, however, what I believed to be the best advice that I could offer. Those who listened to my minority viewpoint more than likely made more than 20 percent per year on their investments over the following three to four years. This was not because I was a better predictor of the future than anyone else was, but because I was giving reasonable orthodox advice and was not attempting to make "predictions" at all. It is far easier to be right if you base your opinion on long-term trends than if you try to guess when a new trend will begin. Those individuals who regularly make extreme predictions are playing a game of insurmountable odds. This assumes that it is truly their goal to be right instead of unabashedly trying to attract attention to themselves and their books by being "different." Why have we as Christians cornered the market on pessimism? I will cover this issue more in Chapter 3. For now, let’s meet the individuals who are capable of driving Christians by the thousands to do the most unorthodox things imaginable with their money with a single comment.

Christian Money Trap "Following the financial predictions of Televangelists"

1. "I’m a Televangelist: Hear Me Roar"

Contrary to the popular caricature that is painted by the media, most of the Christian television broadcasters that I have met are extremely personable, and are genuinely "down-to-earth" people. Many of these television personalities are really outstanding entrepreneurs that started their station or network on a shoestring and built a wonderful media outlet almost entirely from their blood, sweat and tears. I know that television ministries have been responsible for literally millions of people coming to Christ. Therefore, I want to be as clear as I can in communicating that I am not opposed to Christian television. I regularly watch and appear as a guest on many of these programs and intend to do so in the future (assuming they’ll have me after reading this book). I do have what I believe to be legitimate concerns about the damage many of them are unwittingly doing to thousands of Christians’ financial futures.

The unusual trait that almost all of the televangelists have in common is their extremely diverse base of knowledge. These individuals not only have to be Bible scholars, they also must understand the most intricate technical aspects related to television technology. Since many of them started their stations on a shoestring it is highly likely that in the early days they and their families virtually ran the entire enterprise. Some of these individuals are veritable geniuses, knowing everything from how to climb the tower to repair the antenna to how to handle very complex FCC filings. These are very sophisticated people with an unbelievable range of talents. In essence, they have become the proverbial "jacks of all trades." Since their Christian viewers perceive them to literally be an expert on every topic imaginable, they readily take on this role. This assumed expertise is quite a surprising phenomenon.

I have heard most of them speak like "experts" on the following subjects: business, law, prophecy, health and medicine, investing, personal finance, tax matters, marital issues, child rearing, drug and alcohol addiction, politics, international affairs, constitutional issues, home schooling, etc. I would agree that some deserve the title of expert in perhaps one or two of these areas in which they are truly educated and experienced. The real truth is that in most of the above areas, they have nothing more than "general knowledge." The result of this practice is embodied in the age-old axiom: "a little knowledge can be a dangerous thing." Surprisingly, the advice they dole out in the area of finance and investing (I cannot speak about the other topics listed) can be good at times. The majority of the questions dealt with on these shows almost always seem to have an implied common-sense answer anyway: "Should I get out of debt?" or "Would it be smart for me to save more?" etc. The problem occurs when the occasional, more complicated question comes up. Rather than simply telling the viewer to go to a professional, it is likely that the show host will hazard a guess. Guessing your way through a program may make good television, but it can have disastrous results for the tens of thousands that may run out and apply this advice.

Christian Money Trap: "Obtaining Financial Advice from A Televangelist Instead Of A Qualified Financial Professional"

I remember an incident that occurred just after my appearance on a major Christian television program. An individual approached me in the parking lot and introduced himself as legal counsel for the organization that produced the program. He graciously complimented me on how I answered viewer questions and then said, "I wish that _______ could handle himself like you do on the air." He explained that they had been receiving countless letters threatening lawsuits from viewers who were losing money following the advice of the show’s host. I was stunned to hear this from the organization’s own attorney!

The problem worsens when the issue of predictions comes into play. For some reason, televangelists cannot resist the opportunity to make a prediction. The sad truth is that the accuracy of their financial predictions has been unbelievably poor. I do not have any problem at all with any of these television personalities sharing their opinions about the future of the stock market, the economy, etc. Along with their opinions, they should stress that they are not licensed or qualified financial advisers. They should tell their viewers to consider their comments as laymen’s viewpoints and nothing more. I must admit that much of the problem in this area can be attributed to the viewer who (rather than thinking for him or herself) hangs on each and every word offered by the host of his favorite Christian television show.

I get so tired of the calls that I receive at my office almost every day where I must respond to one gloom and doom scenario after another. The calls usually go something like this: "Jim, I was watching ______, and they said that by the summer the market would be down 50 percent. Is that true?" I am usually in a "no-win" situation when trying to answer these questions since most of these individuals have already made up their minds. If I disagree with them they dismiss my view as "uninformed." What they are really looking for is confirmation of their own gloom and doom expectations. I have often imagined what many of these people would do if they happened to be in the audience of the musical "Annie." Just as Annie begins to sing, "Oh, the Sun will Come out Tomorrow," they would likely rise to their feet to dispute the rising of the sun the next day.

Christian Money Trap "Trusting Investment Advice From An Individual, Solely Because He Has Appeared As A Guest On Your Favorite Christian Program"

Another manner in which people are seriously hurt is by the guests that appear on these same programs. It is generally assumed that anyone who appears on a Christian television program is "endorsed" by the host. This is a difficult dilemma, as many show hosts simply cannot screen their guests carefully enough to uncover every potential area of concern. What makes this even more difficult is that the problem is usually not found directly in the content of the book or newsletter the guest is promoting. (Believe me, almost all talk show guests are promoting something; including yours truly.) The truth may only be discovered months later when complaint letters start pouring in. Once such incident occurred when a financial author was interviewed on a major Christian television program. The author was promoting his latest gloom and doom book, which contained his phone number for those who wanted individual financial advice. The financial advice given during his consultations was to buy gold coins from his company. I will never forget the discussion that I had with a Christian lady who called to ask for my help when she lost 50 percent of her life savings in just three months with this man. She told me that the only reason she made the investment was that she believed that the author was legitimate and had been checked out by the show host, who she deeply trusted. I believe that in such cases where there are products, investments, and other services being offered inside a book, the program should do more due diligence before giving airtime to individuals (particularly in the investment arena). This does not relieve us as Christians from doing our own research and fact-finding to protect ourselves from making such costly mistakes.

Four years ago in Central Florida, a Christian financial planner who became a regular guest on one of our Christian television stations was convicted of embezzling over $1 million from viewers of the station. In another incident, a different Christian television station in the same area of Florida was producing and airing infomercials for an individual who is now on trial for fraud. He is accused of bilking thousands of people out of millions of dollars through his television infomercial program.

Several years ago I appeared as a guest on a major Christian television program. The host of the show asked me to check into a mutual fund for him. The fund was named after its founder: someone touting himself as a Christian economist. The reason that this television host was interested in this fund was that he saw it being highly recommended by a preeminent national Christian television personality. He told me that he had intended to put his entire IRA in this fund several months earlier but was unable to get the phone number. I looked in every directory I owned (and then some) and could not find anything on this fund. Finally, I called directory information in several western cities and found a listing for the founder’s financial advisory firm. I called and explained excitedly that I needed information about their fund so that I could complete my research. I was transferred around their office to several different people. Everyone I spoke with gave me the most evasive reasons imaginable for why I could not get any information on this fund. Finally, after I pressured them to just tell me what was going on, they informed me that the fund had lost 50 percent of its value within its first few months of inception. It had been closed out altogether, and what remained of the investors’ money was returned! I could not believe what I was hearing. If you knew who told all of America to buy into this fund, you would be as shocked as I was. How could this happen? These people lost half of their money and the fund closed! It was a good thing that my friend had lost the telephone number or he also would have made this investment.

2. Christian Radio Personalities

Christian radio programming differs dramatically from the programming on its television counterpart. For starters, much of the programming has gone to a talk format with callers interacting with local and national hosts on a variety of hot topics. This change in format, from what was once only Gospel music, has attracted many who would never be regular listeners to Christian radio. In fact, at times you may not even know that you are listening to a Christian radio station. This is because many of the popular issues-oriented programs focus more on conservative political discussion rather than religious issues. Such political conservatives as Alan Keyes, Oliver North and Michael Medved have now replaced many of the formerly popular radio programs featuring Bible preachers. It is now more likely that you will hear a discussion on a vote in Congress than the refrain of "Give Me That Old Time Religion" on most major Christian radio stations around the country. While I do not know whether this shift in programming will ultimately last, it certainly has been the reason for an almost unprecedented increase in listeners to these stations.

Christian Money Trap: "Assuming That an Individual is Qualified To Give Financial Advice Simply Because He Has His Own Radio Show"

My wife and I regularly listen to and enjoy Christian radio, especially with the new issues-oriented format. I find it absolutely horrifying; however, that there is usually no screening process in place to control who can buy time on these stations. I can tell you this first hand, having been on Christian radio nationwide for many years. The only issue of concern in nine out of 10 cases is if my company can pay the bill for the airtime. There is generally very little other qualifying being done. I hope you can see what a recipe for disaster this is. On the one hand, we have literally millions of Christian people who believe that anyone on Christian television or radio is credible and deserving of their trust. This is because they are relying on an assumed check and balance system that does not exist. If you doubt this, call your local Christian radio station and inquire about purchasing ads or a half-hour time slot to air your own show. In most instances, as long as you are not doing something that is overtly non-Christian and you have the money, you can get on the air.

Right here in Central Florida one of our premiere Christian talk show hosts was convicted of conspiracy to commit murder for hiring a contract killer to assassinate his mistress’s husband! In fairness, this same lack of screening exists in secular radio as well. The difference is that individuals listening to secular radio generally practice caveat emptor (let the buyer beware). While one might believe that these relaxed standards may be prevalent only in smaller cities, the truth is even nationwide broadcast companies covering hundreds of cities will let virtually anyone purchase advertising on their show.

Think about all of the investment salespeople out there who would love to be immediately trusted (not questioned) and given a veritable stocked pond of uninformed investors to prey upon. Where do they go for such an opportunity? You guessed it - Christian radio. I again want to be cautious and point out that I do not believe that all financial shows or ads on Christian radio are bad. My advice is simple: Be careful, do your own homework, and look for individuals with a track record and referrals that you can check out. There is no qualifying process in most cases, and that means that virtually anyone can buy time and present himself as an expert on the air. Refer to Chapter 1 of this book for more information on the legitimate qualifications of a financial adviser, Christian or otherwise. Simply having a radio show does not qualify anyone to give out financial advice.

Christian Money Trap: "Responding To Ads from Gold Coin Dealers on Christian Radio"

The most frequent advertising abuse I hear on Christian radio is the endless string of commercials for gold and gold coins. I have asked several of the hosts of these shows why they allow these individuals to advertise. The answer I am given is since they do not endorse these firms or record the ads in their own voice, the listener should know to check the company out on their own. I agree that it is the responsibility of the listener to do his own due diligence, as I have previously stated. Is it right, however, for these programmers to completely ignore the practical implications that such ads are having on Christians? I don’t think so. My view is programmers of Christian radio should have a responsibility much higher than that of their secular counterpart. Their listeners, rightly or wrongly, are placing a high degree of trust and faith in them. Perhaps it is much higher than they even know. Any product with which they associate their broadcast carries with it their credibility. This is why companies place ads on these shows. It is their plan to play off of the reputation and credibility of the program host.

I agree that there is a difference between a radio show host doing a Paul Harvey type of personal endorsement and an ad simply airing during a show. The problem lies in the belief that ads void of such direct endorsements can be broadcast without the careful screening of the company involved. I think it is also fair to point out that about half of the ads you hear during a national radio broadcast are inserted by the local station. There is really no effective way for a national program to police what ads are inserted in every local market. I do feel that these national programmers should use frequent disclaimers warning their listeners that they are not endorsing the investment offers that run during their commercial time slots. The bottom line is to be extremely careful and only place your trust in an organization after you have thoroughly checked it out. I know very well that checking into a company before you invest may take a few hours of your time, and nobody has extra time these days.

To motivate yourself to take this step, consider your efforts as an insurance policy of sorts. Think about it; we all purchase various forms of insurance, spending our hard- earned money, and hope never to have to cash in on them. In the same manner, this commitment to careful scrutiny will keep you out of troubled waters.

3. Christian Financial Authors

As you know, I touched on this issue briefly in Chapter 1, but the subject deserves a few more paragraphs for me to fully share my thoughts with you. I know it sounds unbelievable that someone can write a book predicting a collapse of the U.S. economy, and their advice causes the reader to destroy his retirement account and miss the most unprecedented five years of profit in the history of the stock market. This same author then goes on to receive the most prestigious award in Christian publishing for his work - go figure.

I remember very early on in my writing career I was talking candidly with a major Christian book publisher who I had gotten to know very well. At this time, there was a huge amount of controversy swirling around a well-known evangelist who had a healing ministry. A well-known Christian watchdog group in California uncovered a number of disturbing issues about this man’s theology. I was deeply disturbed to hear these things and felt more than justified to ask my friend if his company would publish books authored by this man if these charges turned out to be true. I will never forget what I was told that dark, rainy night in Dallas. He said, "Jim, the Christian publishing business is just that, a business ." What he was telling me was shocking but quite a revelation of truth to me. I was being told that, regardless of whether these false Biblical teachings were attributable to this man, they would continue to publish his books because they made money!

Do not ever enter a Christian bookstore again assuming that anyone who has his name on a book jacket is qualified to be teaching on the subject matter. Many Christian publishers sadly have placed profit first, not truth. A wonderful friend of mine, who also is a Christian publisher, encouraged me when I told him this story. He said that most Christian publishers are not like this and to not be discouraged. I know this man well and know that even if he knows that a book will be a million-dollar blockbuster, he will turn it down if it falls short theologically or otherwise. We need more men of this kind of character in Christian publishing.

4. The "Radio Infomercial" Guy

We all know about The Home Shopping Network, and have all been up at least once in the middle of the night to tune in to a "get rich quick" show. Program-length advertisements, or what are known as infomercials, are now being broadcast on radio stations nationwide. You guessed it - Christian radio is included. "I have no background or education beyond high school, but I learned how to make 25 percent per month in the stock market while driving a taxi cab," he tells his audience excitedly. I simply call him the "radio infomercial guy." Peter Lynch, former manager of the Fidelity Magellan Fund, averaged 21 percent per year for a 10-year period, and has long been considered one of the most successful investors of our time.

Christian Money Trap: "Falling For Unbelievable Claims from Radio Infomercials Broadcast on Christian Radio"

I wonder how Mr. Lynch feels to now know that this former cab driver with no education or professional qualifications in the investment arena can make more in one month than he earned in an entire year? This would be like claiming you could run a 30-second mile when the world record is just below four minutes! Who could possibly believe such a claim that in the course of a year you could earn 25 percent compounding monthly following the strategies of a former cab driver? Consider just starting with $1,000 at this rate of return. In only 10 years it would be worth over $4 million! This is the kind of situation that does not require much rational thinking to conclude that these representations cannot be true. He has the money to buy airtime and so he continues to get play in most major markets on Christian radio. His marketing plan is simple: he sells very reasonably priced videos, audios, and books during his radio broadcast. He then uses this "list of prospects" to get as much as $5,000 per person to attend his financial training camps. I guess it would not be that bad if people were just out 40 or 50 bucks, but what about those that shell out $5,000? Will your Christian radio station help you get a refund if you are dissatisfied? Probably not.

5. Pastors

I will never forget doing a financial seminar at the request of a pastor in Jacksonville, Florida. He told my assistant that they were using all of my various books in their adult education program and wanted to have me teach during their Sunday morning and evening services. I was honored and agreed to make the trip. All was well until just before the service when the pastor pleaded with me not to talk about life insurance in my presentation. If you have read any of my other books, you know that saving money on insurance is an integral part of my strategies. Keep in mind that I had already made my overhead slides and prepared my presentation and was now being asked to leave this very important element out just minutes before the service. I could not help asking the pastor for some kind of explanation for this unusual request. He explained that a member of their board and very large donor to the church was a life insurance salesman. The man had threatened to stand up and disrupt the service if anything was said on the issue of life insurance. The pastor told me that this individual made his living selling insurance to members of the church and did not want my presentation to disrupt his business. I found out later that morning that he was selling very expensive whole-life insurance. My teaching on how to buy term for as little as ten cents on the dollar versus whole-life would have certainly cost him customers. I had not traveled from my home in Dallas to this church to create a scene, so I respectfully honored the request of the pastor.

This pastor and thousands of other church leaders have become pawns of those who are in the business of fleecing the sheep. I know it is hard to stand up to a board member or a large donor, but we cannot allow any individual, regardless of position or wealth, to usurp the authority structure of the church. In this case the pastor was simply responding out of fear and was perhaps more of an enabler than a co-conspirator. Allowing this man to dictate what was said in the pulpit was not serving his members. In this case, if they had learned the truth they would have been better equipped to make more prudent financial decisions. This would have resulted in fewer buyers of expensive whole- life insurance from this board member.

Christian Money Trap: "Becoming Involved in a Business Opportunity Being Promoted By Your Pastor"

I have seen pastors who have agreed to allow multi-level marketing firms ravage their congregations as long as they were cut in on the overall profits that were made. How much different is this than what occurred with the moneychangers in the temple? Having a position of leadership brings with it a requisite of responsibility. I do not believe that pastors should complicate their already difficult position by trying to recruit their members into multi-level marketing or any other business deals. Furthermore, I believe it is wrong to attend a church, Sunday school class or other church function for the purposes of soliciting business. I am a professional financial adviser and never (I mean never) use my personal relationships as a prospect pool. If an individual approaches me at church about investing concerns, I ask them to call me during the week at my office. Our focus should not be on recruiting distributors or clients during our times of worship and Christian fellowship.

Someday you will be called to give an account of the money that God has entrusted to you. This chapter has outlined what I believe to be some of the most likely money traps that you will encounter. Seek counsel from a number of individuals before jumping into any investment or business opportunity. Never trust anyone just because he is on Christian radio or television or has authored a Christian book. God has a plan for your life and your finances. Stop today and pray to ask him to give you wisdom about these major life decisions before you make them. I know he will.