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God and Money, How We Discovered True Riches at Harvard Business School with Greg Baumer

Greg Baumer, Co-author, God and Money

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Greg Baumer comes on the show to discuss wealth creation and why it isn’t wrong. He brings in scripture to discuss how money should be used. He also gives us an overview of his background, his career with McKinsey & Company, his work as an investment professional with Advent International, and his experience getting an MBA from Harvard Business School. He talks about a course he took at Harvard Divinity School called God & Money.  From his experiences, he recommends sharing financial info with close friends for accountability purposes.  

Announcer 0:00
This show is produced by the Hartman media company.For more information and links to all our great podcasts, visit Hartman media.com.

Announcer 0:12
Welcome to the Solomon success show, where we explore the timeless wisdom of King Solomon and the Bible as it relates to business and investing false prophets and get rich quick schemes are everywhere. Let’s not be distracted by these. Instead, let’s go to the source, the eternal principles that create a life of peace, power, and prosperity. Here’s our host, Jason Hartman.

Jason Hartman 0:40
It’s my pleasure to welcome Gregory bomber to the show. He is vice president of product development and innovation at navvy health, co author of God and money, how we discovered true riches at Harvard Business School, former consultant at McKinsey and associate ad private equity firm Advent International. Greg, welcome. How are you?

Greg Baumer 1:00
Jason, thanks so much for having me on the show today, I really appreciate the opportunity.

Jason Hartman 1:03
It’s good to have you so many people might think, you know, Harvard Business School. Isn’t that the place where all the really aggressive people go? And, you know, they’re just all looking to get rich, and it’s all about money and forget about spirituality of any sort.

Greg Baumer 1:20
You know, tell us about this book, title God money, how we discovered true riches at Harvard Business School, you know, most people might think that and they would be right. And I would even put myself into that category on my first day on campus at Harvard Business School. But I think my story illustrates how God can reach anywhere into people’s hearts. So will happen to me as I was on the fast track to success in my mid 20s, earning a very high income. And to be honest, I was happy to spend about just every penny of it. But when I showed up at Harvard Business School, I had the opportunity to cross register into a class at Harvard Divinity School, and that class was called God and money which is then now the title of our book. And it was in that class exploring the intersection of faith and finance that God truly spoke to my heart on the subject

Jason Hartman 2:06
of money. So great. Tell us about that a little bit. I mean, is it wrong to desire money? Is it wrong to create wealth for oneself?

Greg Baumer 2:13
I do not think it is wrong to create wealth for oneself. In fact, if you read through scriptures, many of the patriarchs many of the characters that Scripture tells us about we’re very wealthy individuals. For me, it all comes down to how you use the money. And I think a good example of that is in First Timothy, when the Apostle Paul is writing to Timothy, about how to pasture to those who are wealthy and his congregation. The apostle Paul also says that there’s not money that is the root of all evil, but rather it’s the love of money. So wealth is not inherently bad. But I do think that wealth can be a snare and it all comes down to whether we are honoring God or not with what he’s blessed us with.

Jason Hartman 2:53
So talk to us about that. How do we honor God?

Greg Baumer 2:56
I think that this is a message that many Western Christians in particular giller Miss, I think we make two common mistakes with respect to our wealth. The first is that we expect to find satisfaction and contentment in our possessions. This is the proverbial keeping up with the Joneses. Trying to chase after that next thing that will finally make us happy, instead of putting our satisfaction in Christ, so that’s Mistake number one. Mistake number two that Christians often make is fear, especially those who have accumulated wealth become so fearful of losing it spend so much of their time thinking about how to manage their wealth, they become so tight fisted that they’re unable to be generous with what God has blessed them with. So the way that we honor God with our wealth, then is to understand that our wealth is a gift from him, and there’s an opportunity to participate alongside him and the fulfillment of his kingdom. Okay, so

Jason Hartman 3:47
can you drill down on the mechanics of that a little bit, maybe share some life examples of how we would apply some of those?

Greg Baumer 3:55
Sure. So what my co author john and i did is study scripture from from To back trying to devour everything related to money. What we ultimately concluded is that everything we have truly belongs to God and not to be used for his purposes. So the question then was how do we actually apply that in our lives? I would argue that those prior two statements I just made are biblical teaching. Everything is God’s and should be used for his purposes. How that is applied. What I’m about to propose, I am not saying is a scriptural command, but rather my opinion for best practice on how to apply it. But what we believe is best practice is setting what we call financial finish lines, that is caps on how much you’ll spend in one year, and how much you’ll accumulate in net worth in total, recognizing that God provides amply for our families, but any excess that we’re able to accumulate is best given away to encourage that growth in God’s kingdom and to participate alongside him, offering us the joy that we cannot experience otherwise.

Jason Hartman 4:52
caps. Tell us about the caps. Interesting.

Greg Baumer 4:56
Yeah. So we propose setting caps on the amount you’ll consume and why So an income cap or a consumption cap, you could say,

Jason Hartman 5:03
and that’s not an income cap it so what you’ll spend of your income to live life, right?

Greg Baumer 5:07
Exactly, yeah better said is a consumption cap

Jason Hartman 5:10
consumption cap. Okay, you know, you’re making me think of politics and cap and trade

Greg Baumer 5:16
that can come up. That’s a different thing

Jason Hartman 5:19
with a rather ominous agenda, I might say, but

Greg Baumer 5:24
I would agree with that.

Greg Baumer 5:26
And then the second is a cap on total net worth that you’ll accumulate, essentially, meaning once you hit that cap, any incremental income you earn will just be skimmed off the top and given away because you don’t need more wealth. So the way that we set about defining those numbers again, I don’t want to become a fantasy and state that our formula is is you know, God’s law. It’s not I think the numbers will look different for every family. But what we try to do in the book is outline the series of questions that any family ought to consider to come up with their own number, where john and I landed is a question Trouble upper middle class lifestyle. So you could think about a family of four in an average cost of living city, we set our cap at around $100,000 of consumption for year per year, and then a cap of $4 million of total net worth and that would include one’s house retirement accounts, etc. What those numbers allow us to do is live a very comfortable, adequate life, provide education to our children health care, save responsibly for retirement without indulging in luxuries simply for luxuries sake, under the logic that that money could be better used to fulfill God’s kingdom. Right.

Jason Hartman 6:35
But you know, is money ever not used? And, you know, this is a bit of a tangential issue, of course, because I know what you’re getting at. And I’m not trying to be just a skeptic for the sake of heckling you. But you know what bugs the heck out of me is there is this TED Talk video that people on the left are constantly spreading around of this rich guy. He’s a venture capitalist, forgive me. I can’t remember his name. And he talks about how rich people don’t contribute To the economy, and he says something like, Well, I’m not gonna buy 3000 cars. So my I don’t really contribute that much through consumption. But Money Never Sleeps, does it? I mean, if you have money in the bank that is created capital for someone or some company, and capital formation is, you know, I do lending. I have a lending company where I lend my own money out for real estate deals. And I’m, I can’t imagine how much I’m stimulating the economy with people hired to rehab houses and make neighborhoods better, and it’s pretty fulfilling, really, and I’m not even doing it directly. It’s just the capital only that’s being used.

Greg Baumer 7:37
But it’s a fair point. And I’ve seen that Ted Talk, and there’s plenty that I disagree. I mean,

Jason Hartman 7:43
that guy’s an idiot, you know, yeah, I just can’t believe he says that stuff with a straight face. How can you think that he’s a sophisticated man, you know,

Greg Baumer 7:50
I think he’s got a good heart, but perhaps his application is a bit different than what I’d come up with.

Jason Hartman 7:55
I’ll leave it at that. Well, that’s a nice way to say it. I’ll just call him an idiot.

Greg Baumer 8:00
What I would say in response, to your point about capital formation, Jason is that it’s not a question of, you know, good versus evil. It’s not like capital formation is bad. And I think sometimes you hear messages like that perhaps coming from the left. As a Christian, our obligation is to pursue the best and highest route with the blessings that God has given us. And so the question that I would ask you is, if you have excess capital that you’re currently using short to stimulate the economy, is that providing the highest what I’ll call Kingdom focused ROI? Okay, were you to deploy, were you to deploy that capital toward Christian ministries in ways that provide for those who cannot provide for themselves or offer the opportunity for individuals to hear the gospel for the first time? Is that generating you know what I’ll call a higher Kingdom ROI than lending to mid sized privately held businesses in your local community? And again, I’m not saying it’s a good versus evil, both are good, but which is better? That’s the question to think about. On the other hand, what One important nuance here is, I will concede that our book does not speak as well to sole proprietors or business owners. I think those with illiquid assets or who own businesses have significantly more complicated questions that they have to answer. One very simple one is how much do I take out of the business every year? You know, let’s say I’m generating $10 million in net income out of my solely own business, and I’ll take some of that a salary. Sure. But should I take the rest out and give it away? Or should I invest it back into the business to provide jobs and to grow a blessing that God has clearly provided? Me? That’s a tough question.

Jason Hartman 9:37
Right, right. Fair enough. That’s a good point about the focus of the ROI. There are certainly inferior and better uses for the money. There’s no question about that. You know it and there should be some consciousness as to how it’s used for sure. But just bugs me when I hear the left argue, you know, that point about capital formation because capital formation is where a whole wealth comes from. We’re all r&d can be funded, economies can grow. I mean, you just got to have capital formation. And guess what that comes from? It comes from discipline. It comes from hard work first. And then after that it comes from delaying gratification. Being willing, you know, all of those people with that money in their hands, they could go spend it like drunken sailors, or they could delay gratification, to create something bigger. And that’s a very mature thing to be willing to delay gratification. Thank you kind of spoke to that point earlier. Actually.

Greg Baumer 10:31
Yeah, I agree with everything you just said, Jason. It’s frustrating. I feel like our capitalist system is not perfect, but it’s certainly the best thing around. And so I am disappointed when I hear critiques from individuals who are benefiting greatly from our capitalist system in ways that are non practical or reduce many of the benefits that our system of hard work and perseverance like you just described has generated in our country today. I think there’s certainly this element

Jason Hartman 10:55
of guilt out there and hypocrisy it’s just blatant hypocrisy. See where you hear? I mean, these rich leftists that just they don’t practice anything they preach. It’s just funny to listen to them. I mean,

Greg Baumer 11:09
yeah, I agree, Jason, what I try to do when hearing those types of messages is to understand where their heart is. And I think it’s always important for us to maintain a critical eye on ourselves as well, because I think there are also some fair critiques of the right which I would put Oh,

Jason Hartman 11:26
absolutely. I, I’m part of the libertarian group. So I don’t even claim to be as much of a conservative anymore because I’ve been alienated to some extent by that group, you know, so, you know, they they become sellouts think that just the small government is the only way to have it and, and that’s pretty biblical to the nations aren’t the thing. It’s the people. It’s about the people, not the countries, you know,

Greg Baumer 11:51
local communities governing themselves, right.

Jason Hartman 11:53
Absolutely. Absolutely. Self governance

Greg Baumer 11:55
with Christ at the center. Yep. Yeah, not that I’m advocating for a theocracy, but

Jason Hartman 12:00
Got it. Yeah. And then that whole church and state separation thing has been really maligned also, of course, but the debate will continue. Indeed, no question about it. Okay, well, what else can we know? I mean, you you recently got a big lump sum of money when I think you were a shareholder in your company, and there was a buyout or something. You had some issues in dealing with that. And you kind of thought about your past and how you might have used that money versus what you actually did, right?

Greg Baumer 12:27
That’s exactly right. I grew up in the church. And so I always knew about tithing, but I will confess that I was pretty selfish with my money prior to God transforming my heart on the subject. Then when I graduated from business school, I joined a healthcare startup in Nashville, Tennessee, and not six weeks after I started my job, we were acquired by a much larger healthcare company. And as a shareholder in the firm. I received almost half a million dollars all at once. And how long were you there? Six weeks. Did you say six weeks? What a deal? Wow. Yes. Fantastic. Yeah, it was an incredible blessing. And it was no coincidence, right? I think it’s one thing for me to sit in my ivory tower on campus and write about what I’ll one day do with money. I don’t have yet. But this is very clearly God testing me, Greg, did you really learn anything? And I’m very grateful to the Holy Spirit for the consistency that the Holy Spirit provided my wife and I, as we stewarded that cache, deciding to give a substantial sum away, deciding to save responsibly and deciding to consume a much lower percentage than we would have previously. Yeah,

Jason Hartman 13:30
that’s very interesting. You know, I love what augmon Dino, the late great augmentee know says about that. He says, speaking to God in His great little poem called the seeds of success. He says, I know you always try me with a little first to see what I would do with a lot. I just love that. I think it’s awesome.

Greg Baumer 13:46
I totally agree with that. Yeah.

Jason Hartman 13:47
And you kind of got for the level, you were at the socio economic level you were at in your life, getting a half a million dollars, suddenly, that was a lot, right? It was infinity times my network, which is negative at the time. There you go. Okay. All right, tell us more

Greg Baumer 14:01
so, and I think the most important lesson that my wife and I learned from that process, indeed, there are two lessons and they’re related to one another. The first is that, even though I’d written this book and got hooked on this topic of generosity, money is still very tempting. Now, like I said before, money itself is not evil. But having money is tempting for humans naturally. And so even as I had just written this book, there were plenty of times where my wife and I looked at each other and said, can’t we just give a little bit less, or give it later and use it to buy these things we think we need right now. And it was through prayer and the Holy Spirit that we were able to withstand that temptation. So that’s one lesson. The second lesson is that we finally for the first time in our lives, at least experienced the unique joy that comes from truly living generously, even though we tied previously we did so with the wrong attitude. I would say it was probably more like, you know, the cost of admission. I paid God each week so that I could spend the rest of my money how I wanted, and it wasn’t until God corrected my understanding of his deeds. Not money that I felt like I was really working alongside him to accomplish things for his kingdom. And that just brought a joy we had never experienced before. And frankly, we want to experience again and again,

Jason Hartman 15:11
no, no good stuff. So not tithing as an obligatory thing, you know, how you how you view it and harkening back to our discussions on government here today. It’s amazing that the church can survive on 10%. But the government needs like 40 something percent.

Greg Baumer 15:30
And in fact, the church doesn’t even get 10%

Jason Hartman 15:33
Well, that’s true. You’re right. You’re right. Yeah. Yeah. It’s really ironic. And it is, what else would you like people to know? And tell us more about Harvard Business School, if you would just dive into that a little bit more and you know, that environment and what, what you more about what you learned,

Greg Baumer 15:47
people call it the West Point of capitalism. And I think that’s right. I feel very fortunate to have had the opportunity to be there, the other 900 students with whom I was able to interact were just truly incredible. From All over the world incredibly interesting backgrounds, incredibly intelligent. What I found, though, is as ambitious as they were, they also had very deep hearts. So I was actually shocked by how many of them wanted to use their career as a way to benefit society in their own ways. At the same time, I was disappointed, perhaps not surprised, but certainly disappointed at how little a place God had on campus. Now there is a thriving Christian fellowship at Harvard Business School, but it’s small, so it’s a close knit group. And I just wish that more students there, were able to see that accumulating wealth can have a huge impact. But when processed through a Christian lens, the impact is even higher. So

Jason Hartman 16:43
as the political correctness plague hit Harvard Business School, I mean is that I’m sort of interested in knowing what the vibe is there. You know, like, on so many college campuses, it’s just become so radically left. It’s amazing. God forbid you should bring a word God into anything. You know, God, you know, the pardon the pun. But

Greg Baumer 17:04
right, Harvard University, you asked if the plague is hit, I would say that that Genesis or the epicenter of the plague is Harvard University. Harvard Business School is by far the most conservative part of Harvard University. And so I think I didn’t experience as much of that, as one might anticipate. Now, of course, you know, I would say, like, my average peer student would offer the very common, you know, socially liberal, fiscally conservative point of view on politics. And I think there was an assumed view of certain social issues that I’m sure listeners can understand what I’m talking about. But at the same time, there was also a real openness to thinking about how business can help society in a positive way that I think you don’t hear as much in political discourse generally.

Jason Hartman 17:51
Interesting. Okay, what else on what you learned or anything in the book you want to cover as we just get toward wrapping up here?

Greg Baumer 17:58
Sure. One thing that I’ll hit on is There’s real power in engaging in generosity in groups. I think this is something that more Christians could think about implementing. In fact, we in the church, talk constantly about doing things in communities, small group Bible studies, accountability groups, small group retreats. But one topic that always gets left out of that is money. One thing that we found is that there’s real power in engaging in stewardship alongside your community to practical applications for that. One is I recommend that groups of families who are close friends pull money together to do a big given project. First, it can amplify the effectiveness of your giving, because you can give a much larger amount to a cause you’re jointly passionate about. And second, because you are jointly passionate about that subject. It’s a really great bonding mechanism for the group. So a group of seven families, myself included are translating the Bible into a new language for the first time, and it’s an amount of money far exceeding what any one of us could give on our own and it’s pretty exciting.

Jason Hartman 18:56
Really what language I’m surprised it hasn’t been translated into everyday life. Which by now,

Greg Baumer 19:00
yeah, check out the Seed Company online. And there’s actually hundreds of languages that it’s not yet been translated to, although we anticipate translating into all languages by 2020. So time is running out the specific language. So it’s actually confidential in that it’s being translated into a small community language in an area that is 99% Muslim, and it’s actually dangerous to talk about it’s well said,

Jason Hartman 19:23
Isn’t that unbelievably sad and scary that it’s dangerous to talk about that? I mean, just absolutely unbeliev it

Greg Baumer 19:30
really, I think it’s very sad, but it ought not be surprising. You know, Jesus tells us that the Christian life will be hard, and that will always face persecution. So I think we ought to fight for freedom of religion globally, but at the same time, we should not be surprised that it does not exist. That

Jason Hartman 19:44
is a way to bond people together. I think that’s that’s really quite interesting. Yeah.

Greg Baumer 19:47
The second practical application step around stewardship and community is I think we can use accountability around our finances. So I advocate that Christians share their financial goals. Financial spending habits with you know, a very small and close group of other Christian advisors. So my wife and I publish our finances to a group of a few other families each year. And it’s focused on ensuring accountability in that we are honoring God with our spending, saving and giving decisions. So I think it’s a really powerful way to bring some shed some light on an area that we often hide for ourselves and perhaps are not honoring God as best as we could good stuff.

Jason Hartman 20:25
give out your website and tell people where they can find the book and find out more about you. Sure. So

Greg Baumer 20:30
the book is God and money, how we discovered true riches at Harvard Business School. Our website is God and money.net. And the book is available at all LifeWay stores across the country, some Barnes and Noble stores and of course can be purchased online at Amazon or other book retailers.

Jason Hartman 20:50
And, Greg, one last question for you. Infinite giving. That’s something you talked about, I believe, tell us about that as a financial strategy. I mean, I know the overall theme has depth We touched on that, but I just wanted to ask that specific question.

Greg Baumer 21:02
Infinite giving simply refers to an understanding that anything that we receive financially beyond what we need can be given away. And doing so actually offers a more joyous life than you’ll experience otherwise. So it’s referring to capping out your net worth, financial finish line that we discussed earlier, and then all incremental money beyond that being given away. And I think anyone who decides to embrace a strategy like that, or even on the path toward that will experience joy they’ve never felt before.

Jason Hartman 21:33
Fantastic. Good stuff. Greg, thank you so much for joining us today.

Greg Baumer 21:36
Jason. Thanks for having me. It’s a real pleasure and honor.

Jason Hartman 21:39
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