In 1992, I had a successful practice in Orlando called Covenant Financial Management and an 18-year career as a financial consultant/branch manager. But I felt called by God to make another change. I was very active in the pro-life community and wanted to do much more for God's kingdom.
My hot button was this: While pastors in denominations often had decent retirement plans, the pastors from independent churches were left high and dry. I began to put together a retirement program geared to helping them on a national scale.
I soon realized I could not advise them to invest in companies that advocated sin when these pastors were preaching against the evils of abortion and pornography. I looked around for investment products to build biblically responsible portfolios, not only for pastors, but also for other Christian investors as well. I could not find an investment that reflected biblical principles.
After examining a few socially screened funds and faith-based funds—which excluded companies involved in alcohol and tobacco—none screened for issues such as abortion and pornography.
I had been selling mutual funds for 18 years, but never operated one. I found out early who the real chairman of the board was—and it wasn't me. Needing to raise $1 million in capital to get the fund going, I formed Timothy Partners, Ltd. and made a list of 50 well-to-do friends who could each contribute $50,000 without really missing it. This meant I only needed to find 20 willing people. Only three, however, actually agreed to invest.
I realized I knew who I thought should have been in our partnership group, but God knew all along who He wanted to be part of it. Over the next six months, I met people I had never known before who became initial investors, and we raised the full million dollars.
After two years of research and development, in March 1994, we launched Timothy Plan, a mutual fund based on a founding commitment that we would never compromise biblical principles. We have been faithful throughout, and I believe that's why God has allowed us to proceed and grow.
"Not a Penny"
Our arrival was not met with universal enthusiasm. "This fund may have gone too far. It sounds like someone trying to preach to the converted and then setting up a big collection," mutual fund analyst Michael Lipper told Bloomberg News in April 1994.
My Wall Street friends all cautioned me that what I was about to do was impossible. "You can't do that, you can't exclude investing in some of the most profitable companies and expect to get good returns," they'd say. My answer to them was that in God's economy "obedience trumps performance every time."
Besides, you don't even have to sacrifice performance. At times, we trail, and we're at a comparative disadvantage when the stocks we screen out run wild. But over time, it evens out and we're competitive in the long run.
Timothy Plan initially focused on five core factors: abortion, pornography, alcohol, tobacco and casino gambling. Later, we added screens for anti-family entertainment, unbiblical lifestyles and human rights to the mix. Our screens of gambling, tobacco and alcohol may be areas where an element of "Christian liberty" could be expressed, but because of the overwhelming abuses and destruction caused to families and society, we screen them.
Our first marketing piece concealed a penny with the following question: "How much money is OK to have invested in abortion or pornography? The answer is simple. Not a penny."
Business was slow at first. We began by losing $40,000 to $50,000 each month, despite our materials and operations being of a quality that would rival the largest firms. In our first 18 months, we ran out of money. It was the lowest point of my life. All these partners had trusted me with $1 million, and it was gone.
Over the years, the going was rough, yet every time we were in trouble, God led me to people He wanted to be part of our mission. I remember one New Year's Eve when Timothy Plan was in financial peril. We had a 4 p.m. deadline to come up with cash or be put out of business by the Securities and Exchange Commission—we just made it.
From then on, we started growing and have not stopped. On July 20, 2018, we hit a milestone with $1 billion in assets under management. Now we manage a family of mutual funds and recently launched a few exchange-traded funds (ETFs).
It's evident that God's hand is in all of this. I must reiterate: I am not in charge of this company. Jesus Christ is the chairman of the board.
Arthur Ally is founder and president of Timothy Plan, the nation's leading biblically based, pro-life, pro-family mutual fund group that uses stringent moral screening criteria designed to avoid investing shareholders' money in any company that has a pattern of contributing to the cultural pollution of society. He recently ran the opening bell for the New York Stock Exchange on Oct. 21, 2019.
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