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Being a Good Financial Steward: A Lesson from the Parable of Talents

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Joel BaumanThis article was submitted by Joel Bauman, SchiffGold Precious Metals Specialist. Any views expressed are his own and do not necessarily reflect the views of Peter Schiff or SchiffGold.

Like the tale of the Good Samaritan or the Unfruitful Fig Tree, the Parable of Talents is one Christ’s teachings to his disciples to instruct them of God’s will for Man’s life. Traditional Christian interpretation of the “Parable of Talents” sees it as a didactic and cautionary tale told by Christ to his disciples illustrating the importance of taking risks for the sake of the Kingdom of God. Christ warns his followers to use their personal gifts or “talents” to further God’s work. Failure to do so appropriately would result in severe judgment.

Others interpret the tale as illustrating good investment advice. As such, the “Parable of Talents” is still applicable today with respect to being a good financial steward of your wealth. Even though many biblical scholars interpret the parable as being applicable to both money and human talent, this article will focus exclusively on the stewardship of money.

The Story

While I’ve included the actual verses from Mathew Chapter 25 in my analysis below, I’ve also included a synopsis:

A master leaves his house to travel abroad for an extended period of time. Just before leaving, he gives his three servants different amounts of precious metals (i.e. money) or “talents” to oversee. He gives each servant according to his ability: one servant receives five talents, the second receives two, and the third receives only one talent, for a total of eight talents.

After returning, the master then asks each servant for an account of their stewardship of his property. The first and second servants report they put their talents to work, doubling the value of the master’s property. However, the third servant reports he buried the metal to keep it safe. The master admonishes the servant, calling him “wicked and slothful”, and explaining that he should have put the money in the bank where it would have drawn interest. In short, the third servant was a bad steward of his master’s property.

Lessons from the Parable of Talents

The following verses are taken from the Book of Matthew, chapter 25, verse 14- 27. I’ve included my analysis on what the parable teaches about being a good steward of one’s “talents” or wealth.

14 For the kingdom of heaven is as a man travelling into a far country, who called his own servants, and delivered unto them his goods. 

15 And unto one he gave five talents, to another two, and to another one; to every man according to his several ability; and straightway took his journey.

16 Then he that had received the five talents went and traded with the same, and made them other five talents. 

17 And likewise he that had received two, he also gained other two. 

18 But he that had received one went and digged in the earth, and hid his lord’s money.

19 After a long time the lord of those servants cometh, and reckoneth with them.

20 And so he that had received five talents came and brought other five talents, saying, Lord, thou deliveredst unto me five talents: behold, I have gained beside them five talents more.

21 His lord said unto him, Well done, thou good and faithful servant: thou hast been faithful over a few things, I will make thee ruler over many things: enter thou into the joy of thy lord.

22 He also that had received two talents came and said, Lord, thou deliveredst unto me two talents: behold, I have gained two other talents beside them. 

23 His lord said unto him, Well done, good and faithful servant; thou hast been faithful over a few things, I will make thee ruler over many things: enter thou into the joy of thy lord. 

24 Then he which had received the one talent came and said, Lord, I knew thee that thou art an hard man, reaping where thou hast not sown, and gathering where thou hast not strawed:

25 And I was afraid, and went and hid thy talent in the earth: lo, there thou hast that is thine.

26 His lord answered and said unto him, Thou wicked and slothful servant, thou knewest that I reap where I sowed not, and gather where I have not strawed: 

27 Thou oughtest therefore to have put my money to the exchangers, and then at my coming I should have received mine own with usury.

Good and Bad Biblical Stewards

The passage above illustrates the characteristics of both good and bad stewards:

Good stewards – Those who increase their given talents by increasing their value, both in the literal, monetary sense and in terms of our gifts and abilities.

Bad stewards – Those who fail to grow a given talent or talents, especially out of fear and mistrust.

Anyone who believes in capitalism or seeks to do God’s will agrees that the profitable use of our talents is good. Additionally, most would also agree a failure to use such talents is poor stewardship.

The first two servants were good stewards, as they traded with the money given to them and produced a 100% return. See verses 16 and 17 below.

16 Then he that had received the five talents went and traded with the same, and made them other five talents.

17 And likewise he that had received two, he also gained other two.

The final servant out of fear for his master buried the talent given to him in the ground.

18 But he that had received one went and digged in the earth, and hid his lord’s money.

The master, displeased with this sluggish act, told the final servant he should have at least earned interest (i.e. “usury”) on the money.

27 Thou oughtest therefore to have put my money to the exchangers, and then at my coming I should have received mine own with usury.

The English Standard Version Bible translation reads this verse as, “27 Then you ought to have invested my money with the bankers, and at my coming I should have received what was my own with interest.”

Financial Stewardship Today

It’s hard not to laugh at verse 27 in light of our current monetary banking policy. Bank interest rates have not compensated for the consequences of inflation. In fact, those who “bury” their dollars in the bank are losing wealth because of the depreciating purchasing power of the dollar. Like the third servant in the parable, it was better for him to dig and hide his gold in the ground than to deposit his US dollars in the bank!

Here is an eye-opening stat on the decline of the purchasing power of the dollar compared to gold:

US bank savings account (average interest rate offered 5.5% since 1960)

$1,000.00 held in a bank savings account since 1960 would be worth approximately $20,000.00 in 2016.

Gold (average nominal return of 6.35% since 1960)

$1,000.00 held in gold since 1960 would be worth approx. $31,500.00 in 2016.

Gold and silver are not adversely affected by the consequences of inflation. Both monetary metals have successfully preserved the fruit of humanity’s labor for thousands of years.

While precious metals beat inflation, they are not productive independent of action. One talent of gold stored in 1960 is still only one talent of gold in 2016. The nominal value is higher but the weight is the same. The parable implies, and many capitalists would agree, if you want to be a good steward, you must find a yield for their gold and silver “talents”.

Finding a Yield on Our Talents

Many find a return on their financial wealth through traditional means. This includes investing in equities, bonds, income-producing properties, and personal businesses.

Dow Jones Industrial Average (average return of 6.39%* since 1960)

$1,000.00 held in the DJIA since 1960 would be worth approx. $32,000.00 in 2016

*Average does not include the dividends paid out to shareholders during the 56 years from 1960 to 2016, so the yield was higher than 6.39%.

Investors who hold their wealth in stocks and other investment vehicles should receive a higher return than simply holding gold because they are taking on a higher degree of risk.

There are many risk-off investors, like myself, who acknowledge the current dangers of a debt saturated global economy. I do not find many traditional investments like the Dow Jones Industrial Average as an attractive means of generating a return. Additionally, I am even more concerned with the counter party risk of holding stocks with an equity broker. For those who aren’t too familiar with financial counter party risk, I recommend reading the story of MF Global.

I believe now more than ever investors should avoid tertiary wealth. Focus on generating a yield from primary wealth and secondary wealth.

Clients ask me, “Is there a way I can earn a yield on my precious metals?” This a good question, and something I will answer in my next article, Generating Yield with Precious Metals.


I believe there is a great lesson to be learned from the Parable of Talents. It’s easy to become discouraged or fearful of the economic state of the world. I want to encourage readers to not retreat from being productive. Practice good stewardship by investing all your talents wisely. By doing this you will benefit not only yourself but also those around you.


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