1 00:00:46,409 --> 00:00:49,240 Suze: May 2nd 2024. 2 00:00:49,250 --> 00:00:52,610 KT: A very auspicious and lucky day. Tell everyone why. 3 00:00:52,619 --> 00:00:55,490 Suze: Well, first of all, welcome everybody to the Women and 4 00:00:55,500 --> 00:01:01,610 Suze: Money podcast with the most feisty KT this morning, right? 5 00:01:01,819 --> 00:01:06,050 Suze: And everybody smart enough to listen. Obviously, this is the 6 00:01:06,059 --> 00:01:08,929 Suze: ask Suze and KT Anything addition. 7 00:01:09,180 --> 00:01:14,489 Suze: If you want, write into Ask Suze Suze podcast at 8 00:01:14,500 --> 00:01:15,760 Suze: gmail.com 9 00:01:16,400 --> 00:01:20,940 Suze: and if KT chooses your question, we will answer it 10 00:01:20,949 --> 00:01:24,378 Suze: on the podcast. But I'm just letting you know there 11 00:01:24,389 --> 00:01:27,610 Suze: are lots and lots of questions. I have never figured 12 00:01:27,620 --> 00:01:30,139 Suze: out how she picks the ones that she, how do 13 00:01:30,150 --> 00:01:30,690 Suze: you pick them? 14 00:01:31,279 --> 00:01:33,539 KT: I usually look at the subject and if it looks 15 00:01:33,550 --> 00:01:36,500 KT: like something fun or they say KT pick me, I 16 00:01:36,510 --> 00:01:39,268 KT: pick them. But wait, today is May 2nd. 17 00:01:39,309 --> 00:01:39,449 Suze: I know! 18 00:01:39,989 --> 00:01:42,029 KT: Tell everybody whose birthday it is. 19 00:01:42,069 --> 00:01:47,550 Suze: It's our friend Mika Brezinski who hosts the morning Joe 20 00:01:47,559 --> 00:01:51,940 Suze: show with her husband Joe Scarborough. And yes, it is 21 00:01:51,949 --> 00:01:54,459 Suze: her birthday today. 22 00:01:54,589 --> 00:01:58,500 KT: We wish you a very, very happy birthday. A fun birthday. 23 00:01:58,769 --> 00:02:02,970 KT: And I love that your favorite celebration is ice cream. 24 00:02:03,580 --> 00:02:05,849 Suze: What kind KT? What kind of ice cream? 25 00:02:06,139 --> 00:02:11,228 Suze: Mini Melts! But for all of you, who don't know Mika 26 00:02:11,240 --> 00:02:17,020 Suze: created the Know Your Value revolution that was here in 27 00:02:17,029 --> 00:02:20,948 Suze: the United States that has gone overseas everywhere so that 28 00:02:20,960 --> 00:02:23,250 Suze: women everywhere know 29 00:02:23,485 --> 00:02:27,875 Suze: their value. All right, Miss Travis. Are you ready to begin? 30 00:02:27,883 --> 00:02:28,595 KT: I'm ready. 31 00:02:28,604 --> 00:02:30,505 Suze: So wait, wait, how do you feel? 32 00:02:30,794 --> 00:02:31,704 KT: I feel great. 33 00:02:31,794 --> 00:02:34,595 Suze: But Colo is gone. How do you feel? 34 00:02:34,625 --> 00:02:36,574 KT: A little lonely? 35 00:02:36,585 --> 00:02:37,104 Suze: You do? 36 00:02:37,115 --> 00:02:40,104 KT: I do because I'm used to his face every morning 37 00:02:40,214 --> 00:02:42,904 KT: coming in and we say Colo, would you like a shot? 38 00:02:43,074 --> 00:02:45,695 KT: And that shot is his little espresso. We have a 39 00:02:45,705 --> 00:02:48,065 KT: great coffee machine here on the island 40 00:02:48,350 --> 00:02:51,100 KT: and we make Colo a little shot of espresso. He 41 00:02:51,110 --> 00:02:54,770 KT: gets up at 4:30. He's up way ahead of us, 42 00:02:54,899 --> 00:02:59,110 KT: way that ahead of us and we see his little 43 00:02:59,119 --> 00:03:02,089 KT: face every morning and he knows we're, you know, he 44 00:03:02,100 --> 00:03:05,000 KT: knows when we're recording but every morning we either have 45 00:03:05,008 --> 00:03:07,589 KT: breakfast together or say Colo ready for your shot, 46 00:03:07,960 --> 00:03:12,000 KT: but I miss him. Oh, ok. He's in Colombia with 47 00:03:12,008 --> 00:03:14,429 KT: his wife. He'll be back in a couple of days. Well, 48 00:03:14,440 --> 00:03:15,258 KT: about a week. 49 00:03:15,279 --> 00:03:19,380 Suze: Me, I'm so happy to be alone with Miss Travis. 50 00:03:19,389 --> 00:03:23,008 Suze: I can't even tell you. All right, KT first question. 51 00:03:24,179 --> 00:03:28,220 KT: All right. I will be 62 soon. Can I apply for... 52 00:03:28,229 --> 00:03:29,490 Suze: Do you remember those good old days? 53 00:03:30,270 --> 00:03:34,059 KT: It wasn't that long ago. I will be 62 soon. 54 00:03:34,070 --> 00:03:38,220 KT: Can I apply for retirement Social Security and receive the 55 00:03:38,229 --> 00:03:43,440 KT: $500 a month and invest it while working part time 56 00:03:43,449 --> 00:03:47,160 KT: until I am in full retirement age of 67. 57 00:03:47,169 --> 00:03:49,679 Suze: You can. But it would be the most ridiculous thing 58 00:03:49,690 --> 00:03:51,559 Suze: you have ever done in your life. 59 00:03:51,695 --> 00:03:54,085 Suze: If you really want to make the most out of 60 00:03:54,095 --> 00:03:57,134 Suze: that money, can you just do me a favor and 61 00:03:57,145 --> 00:04:01,115 Suze: don't claim it at all? Just wait till you're 67 62 00:04:01,125 --> 00:04:03,934 Suze: and you would get a whole lot more money, probably 63 00:04:03,945 --> 00:04:07,985 Suze: more than you would make, investing it. All right, KT, next. 64 00:04:07,994 --> 00:04:11,315 KT: Next question, KT and Suze, you have done so much 65 00:04:11,324 --> 00:04:13,035 KT: for my financial journey. 66 00:04:13,460 --> 00:04:17,109 KT: Thank you. So, Monica says I have a trust with 67 00:04:17,119 --> 00:04:20,519 KT: the local law firm and the lawyers keep changing it. 68 00:04:20,529 --> 00:04:24,059 KT: Every time I want to make a minor update, it 69 00:04:24,070 --> 00:04:30,119 KT: becomes a huge deal and cost. Wait. So she's asking Suze, 70 00:04:30,130 --> 00:04:33,630 KT: can I amend my trust with the must have documents. 71 00:04:33,640 --> 00:04:36,829 Suze: The answer to that is absolutely one of the reasons 72 00:04:36,839 --> 00:04:39,320 Suze: that the must have documents were created 73 00:04:39,579 --> 00:04:42,700 Suze: is so that you could change them anytime you want 74 00:04:42,709 --> 00:04:44,989 Suze: and not have to go back to a lawyer and 75 00:04:45,000 --> 00:04:50,078 Suze: pay for it. So you would have to redo your documents. Obviously, 76 00:04:50,089 --> 00:04:52,859 Suze: you can't use the ones that you already have. But 77 00:04:52,869 --> 00:04:56,109 Suze: once they're in the system with the must have documents 78 00:04:56,220 --> 00:05:00,519 Suze: you can update them any time you want? Alright, go on Ms. Travis. 79 00:08:23,059 --> 00:08:26,450 KT: All right, Lucy, dear, Suze, my partner and I are 80 00:08:26,459 --> 00:08:27,579 KT: getting married soon 81 00:08:27,670 --> 00:08:30,890 KT: and are taking your word on getting a prenup. I'm 82 00:08:30,899 --> 00:08:34,390 KT: confused about where I can get or do this without 83 00:08:34,400 --> 00:08:37,689 KT: forking out a bunch of money to a lawyer. Do 84 00:08:37,700 --> 00:08:40,130 KT: you know of any resources where I may be able 85 00:08:40,140 --> 00:08:44,319 KT: to do this for free or for a reasonable fee? 86 00:08:45,159 --> 00:08:46,468 KT: What should Lucy do? 87 00:08:46,479 --> 00:08:53,179 Suze: Lucy go online and Google Prenups online and I'm sure 88 00:08:53,190 --> 00:08:56,909 Suze: a whole bunch will come up now, whether they're good, 89 00:08:56,919 --> 00:09:01,049 Suze: whether they're hold up that I don't know. So sometimes 90 00:09:01,059 --> 00:09:03,650 Suze: it's worth it to go to a lawyer, face to 91 00:09:03,659 --> 00:09:08,718 Suze: face both you and your current person to be. 92 00:09:08,729 --> 00:09:12,229 KT: All right, Suze. Next question is from Maddie. 93 00:09:12,590 --> 00:09:17,690 KT: My question is about life insurance. We had term life 94 00:09:17,700 --> 00:09:21,260 KT: and we have outlived our policy. Now. We are in 95 00:09:21,270 --> 00:09:25,270 KT: our sixties and both retired. We want to know if 96 00:09:25,280 --> 00:09:29,330 KT: you know of anyone that has a reasonable price for 97 00:09:29,340 --> 00:09:34,770 KT: life insurance for like 100,000 or 300,000 that we don't 98 00:09:34,780 --> 00:09:39,570 KT: have to pay $350 a month or higher for. 99 00:09:40,570 --> 00:09:43,809 Suze: How old is Maddie? Sixties? 100 00:09:43,820 --> 00:09:45,520 KT: They're in their sixties. 101 00:09:45,530 --> 00:09:50,030 Suze: Maddie. Here's the question. It's one thing to want life 102 00:09:50,039 --> 00:09:54,830 Suze: insurance as you get older. It's another thing to ask yourself. 103 00:09:54,840 --> 00:09:59,599 Suze: Do you need life insurance? Do you have anybody that 104 00:09:59,609 --> 00:10:02,030 Suze: is financially dependent upon you. 105 00:10:02,659 --> 00:10:08,789 Suze: Are you dependent on your spouse's income or whatever? And 106 00:10:08,799 --> 00:10:12,440 Suze: if something happened to him or her, you wouldn't be ok. 107 00:10:12,799 --> 00:10:17,959 Suze: If you need life insurance, then it's going to be 108 00:10:17,969 --> 00:10:23,010 Suze: expensive because the older you get, the more expensive it is. 109 00:10:23,400 --> 00:10:27,949 Suze: So I would go to select quote.com, which is one 110 00:10:27,960 --> 00:10:30,909 Suze: of my favorite quoting services and 111 00:10:31,380 --> 00:10:33,859 Suze: see what they come up with for you for even 112 00:10:33,869 --> 00:10:38,789 Suze: a five or 10 year term insurance policy. However, it's 113 00:10:38,799 --> 00:10:44,270 Suze: going to be expensive. So you have to answer the question. 114 00:10:44,890 --> 00:10:49,020 Suze: Do you need it or do you want it? If 115 00:10:49,030 --> 00:10:52,390 Suze: it is a want let it go, girlfriend. If it's 116 00:10:52,400 --> 00:10:55,309 Suze: a need, then you somehow have to figure out how 117 00:10:55,320 --> 00:10:56,669 Suze: to pay for it. All right. 118 00:10:56,760 --> 00:10:59,349 KT: All right. Next question, Suze is from Donna. 119 00:10:59,919 --> 00:11:04,419 KT: Good afternoon. I listened to your April 25th podcast this 120 00:11:04,429 --> 00:11:10,849 KT: morning about Roth IRAs and I had a question about conversions. Currently, 121 00:11:10,859 --> 00:11:14,500 KT: the majority of my traditional IRA is in a money 122 00:11:14,510 --> 00:11:19,789 KT: market fund with some money in investments 28%. When doing 123 00:11:19,799 --> 00:11:23,580 KT: a Roth conversion. Would you suggest I take the money 124 00:11:23,590 --> 00:11:26,900 KT: from the money market or from the investments? 125 00:11:27,349 --> 00:11:27,900 Suze: Hm. 126 00:11:28,469 --> 00:11:31,780 KT: Wanna make that a quizzy. Wanna make it a flash quizzy? 127 00:11:32,210 --> 00:11:33,340 Suze: What would you say? 128 00:11:33,469 --> 00:11:34,580 KT: Investments. 129 00:11:35,270 --> 00:11:36,200 Suze: You would, would you? (Suze makes the wrong answer noise) 130 00:11:38,190 --> 00:11:44,218 Suze: Again, I'm gonna get her twice today. I can't believe it. So, Donna, 131 00:11:45,429 --> 00:11:49,539 Suze: right now, I don't know what you're invested in, but 132 00:11:49,549 --> 00:11:54,150 Suze: overall the stock markets are still relatively very high. At 133 00:11:54,159 --> 00:11:57,939 Suze: this point in time, we had an incredible run last 134 00:11:57,950 --> 00:12:02,119 Suze: year into the beginning of this year with certain stocks. 135 00:12:02,190 --> 00:12:05,190 Suze: And so therefore I would be doing it from my 136 00:12:05,200 --> 00:12:06,820 Suze: money market accounts 137 00:12:07,309 --> 00:12:11,479 Suze: if these markets happen to tank and they have a 138 00:12:11,489 --> 00:12:16,489 Suze: very good possibility that they might sometime later on this 139 00:12:16,500 --> 00:12:20,219 Suze: year or not so far into the future, nothing is 140 00:12:20,229 --> 00:12:23,200 Suze: stopping it from going down, It could go down 30%. 141 00:12:23,210 --> 00:12:28,989 Suze: Who knows? That's when I would be converting my investments. 142 00:12:29,000 --> 00:12:34,968 Suze: The lower your investments are when you convert the less tax, 143 00:12:34,979 --> 00:12:36,030 Suze: you will owe 144 00:12:36,570 --> 00:12:40,039 Suze: your money market accounts. Doesn't matter. They don't go up, 145 00:12:40,049 --> 00:12:42,710 Suze: they don't go down like a stock does. So when 146 00:12:42,719 --> 00:12:46,939 Suze: you convert cash that's in a money market account, you're 147 00:12:46,950 --> 00:12:49,030 Suze: going to owe the same amount of taxes on it 148 00:12:49,039 --> 00:12:53,729 Suze: today as you would three years from now. So therefore, 149 00:12:53,739 --> 00:12:56,919 Suze: if it were me, I would first do my cash 150 00:12:56,929 --> 00:13:00,400 Suze: right now and if the markets go down, start to 151 00:13:00,409 --> 00:13:01,830 Suze: do the investments. 152 00:13:02,400 --> 00:13:06,830 KT: All right. Next question, Suze. We are a blended family. 153 00:13:06,909 --> 00:13:10,700 KT: We each had three adult children. When we married 12 154 00:13:10,710 --> 00:13:15,799 KT: years ago, we did a revocable trust that becomes irrevocable 155 00:13:15,809 --> 00:13:19,319 KT: when my husband or I die. We did this to 156 00:13:19,330 --> 00:13:23,619 KT: protect our children, should one of us remarry. Do you 157 00:13:23,630 --> 00:13:25,669 KT: see any problems with this? 158 00:13:26,140 --> 00:13:29,489 Suze: I really and I'm gonna state this over and over 159 00:13:29,500 --> 00:13:30,070 Suze: again 160 00:13:30,640 --> 00:13:35,510 Suze: unless you have extraordinary amounts of money. I do not 161 00:13:35,520 --> 00:13:42,640 Suze: like irrevocable trust. Why? Because an irrevocable trust is exactly 162 00:13:42,650 --> 00:13:47,239 Suze: like it sounds once the money is in there, nothing 163 00:13:47,250 --> 00:13:49,580 Suze: can be changed. That's what one of your friends is 164 00:13:49,590 --> 00:13:53,419 Suze: going through. How his father left the money in an 165 00:13:53,429 --> 00:13:57,510 Suze: irrevocable trust and everything now has changed since his father 166 00:13:57,520 --> 00:13:58,849 Suze: died and did that. 167 00:13:59,099 --> 00:14:03,880 Suze: And it's a real travesty. A real travesty. So, in 168 00:14:03,890 --> 00:14:08,710 Suze: an irrevocable trust, if you want to protect your children, 169 00:14:08,940 --> 00:14:13,500 Suze: should one of us remarry? Are you kidding me? Just 170 00:14:13,510 --> 00:14:16,400 Suze: set up separate trusts and keep your money separate from 171 00:14:16,409 --> 00:14:19,039 Suze: the person. You're going to remarry and protect them 172 00:14:19,145 --> 00:14:22,835 Suze: that way. Don't own the house in joint tenancy with 173 00:14:22,844 --> 00:14:26,445 Suze: right of survivorship, own it in tenants in common. There's 174 00:14:26,455 --> 00:14:30,474 Suze: so many ways that you can protect them, do not 175 00:14:30,655 --> 00:14:35,034 Suze: do an irrevocable trust because if things change and your 176 00:14:35,044 --> 00:14:38,395 Suze: kids change and they need something different or whatever it 177 00:14:38,405 --> 00:14:39,075 Suze: may be 178 00:14:39,849 --> 00:14:44,049 Suze: or you need the money, let's say you're getting older 179 00:14:44,059 --> 00:14:46,070 Suze: and you need some of the money that was left 180 00:14:46,080 --> 00:14:49,030 Suze: to them in an irrevocable trust. And now you want 181 00:14:49,039 --> 00:14:51,590 Suze: to change your mind as to what's going to happen 182 00:14:51,599 --> 00:14:55,030 Suze: with that money. You can't change your mind if it's 183 00:14:55,039 --> 00:14:58,789 Suze: in an irrevocable trust, it will be in my opinion, 184 00:14:59,219 --> 00:15:01,960 Suze: one of the biggest mistakes you ever make. Now, I 185 00:15:01,969 --> 00:15:06,400 Suze: think KT in this podcast two or three times, I've 186 00:15:06,409 --> 00:15:10,590 Suze: already said if you do that, take your social security 187 00:15:10,599 --> 00:15:13,080 Suze: at 62 whatever it may. I think I've already said 188 00:15:13,090 --> 00:15:16,039 Suze: three times. It will be the biggest mistake you will 189 00:15:16,049 --> 00:15:20,049 Suze: ever make. Should we call this, should we call this podcast? 190 00:15:20,099 --> 00:15:22,840 Suze: The three or whatever it is? The X amount of 191 00:15:22,849 --> 00:15:26,599 Suze: mistakes you can never afford to make. Don't do it people. 192 00:15:27,510 --> 00:15:31,799 Suze: Ok. Here's one where do they get these ideas from? 193 00:15:32,229 --> 00:15:36,679 Suze: Where does this idea come from? You have never heard 194 00:15:36,690 --> 00:15:40,859 Suze: me say anything positive about an irrevocable trust on this 195 00:15:40,869 --> 00:15:42,780 Suze: podcast ever. 196 00:15:43,169 --> 00:15:48,070 Suze: You only hear me talk about revocable trust. So who 197 00:15:48,080 --> 00:15:51,190 Suze: put that idea in your head? Who put the idea 198 00:15:51,200 --> 00:15:53,820 Suze: in your head that you should take social security? And 199 00:15:53,830 --> 00:15:58,429 Suze: now at 62 get $500 a month and invest it. Who, 200 00:15:58,440 --> 00:16:02,030 Suze: where are you getting this from? KT would tell you 201 00:16:02,039 --> 00:16:02,909 Suze: what should they do? 202 00:16:02,919 --> 00:16:05,599 KT: Shake the cobwebs out of your head, shake it, shake it, 203 00:16:05,609 --> 00:16:07,969 KT: shake it, shake it, shake it, baby. All right. 204 00:16:08,650 --> 00:16:13,679 KT: OK. Next question is from Darlene. Suze, do you recommend 205 00:16:13,690 --> 00:16:18,640 KT: a 68 year old to turn a SEP IRA to 206 00:16:18,650 --> 00:16:22,590 KT: a Roth at this age? I have to assume Darlene 207 00:16:22,599 --> 00:16:25,239 KT: that you're the 68 year old and then it says 208 00:16:25,250 --> 00:16:28,750 KT: other money is currently in CDs and savings. 209 00:16:28,760 --> 00:16:31,770 Suze: Here's the thing and, and this isn't just for Darlene, 210 00:16:31,780 --> 00:16:34,440 Suze: that is for every single one of you listening right 211 00:16:34,450 --> 00:16:34,880 Suze: now 212 00:16:35,239 --> 00:16:40,130 Suze: because it is obvious that the podcast on April 21st 213 00:16:40,140 --> 00:16:42,469 Suze: and the follow up a few days later, I think 214 00:16:42,479 --> 00:16:46,960 Suze: it was April 25th answering all of your questions on 215 00:16:46,969 --> 00:16:52,780 Suze: Roth conversions. Roth IRAs has stirred up such a hubbub 216 00:16:52,789 --> 00:16:56,400 Suze: out there. I cannot tell you. So, listen to me 217 00:16:56,409 --> 00:16:57,150 Suze: closely 218 00:16:57,760 --> 00:17:02,190 Suze: if you are in a situation where you have money 219 00:17:02,280 --> 00:17:08,229 Suze: in a traditional 401k, a traditional IRA which means pre-tax, 220 00:17:08,239 --> 00:17:10,180 Suze: you have never paid taxes on it 221 00:17:10,880 --> 00:17:15,790 Suze: and you are going to literally need that money to 222 00:17:15,800 --> 00:17:20,060 Suze: live on within a year. Two or three. Can you 223 00:17:20,069 --> 00:17:24,419 Suze: just leave it where it is where you really start 224 00:17:24,430 --> 00:17:27,339 Suze: to make the best decisions with your money is when 225 00:17:27,349 --> 00:17:28,369 Suze: you are younger 226 00:17:28,819 --> 00:17:31,810 Suze: and you are putting money in to begin with in 227 00:17:31,819 --> 00:17:35,859 Suze: a Roth 401k or a Roth IRA or whatever it 228 00:17:35,869 --> 00:17:39,198 Suze: may be and it's growing tax free if you're in 229 00:17:39,209 --> 00:17:43,119 Suze: a situation right now where you're in your mid sixties 230 00:17:43,130 --> 00:17:46,399 Suze: or your early seventies and whatever it may be and 231 00:17:46,410 --> 00:17:49,589 Suze: you have $900,000 in a traditional IRA. 232 00:17:50,329 --> 00:17:54,119 Suze: And now you're asking me if you should convert it, 233 00:17:54,250 --> 00:17:58,750 Suze: chances are you should not because many of you may 234 00:17:58,760 --> 00:18:02,599 Suze: need the income to live on and it doesn't make 235 00:18:02,609 --> 00:18:07,229 Suze: any sense to pay taxes on it and then put 236 00:18:07,239 --> 00:18:09,750 Suze: it in a Roth. If you then need to take 237 00:18:09,760 --> 00:18:12,129 Suze: it out of the Roth because you have to live on. 238 00:18:12,140 --> 00:18:16,510 Suze: It makes no sense at all. If you don't need 239 00:18:16,520 --> 00:18:17,459 Suze: the money, 240 00:18:17,910 --> 00:18:22,409 Suze: you're getting older, you will never need it for income. 241 00:18:22,589 --> 00:18:25,089 Suze: That's a whole other thing. And you want to get 242 00:18:25,099 --> 00:18:28,530 Suze: away from RMDs, you want to make it so that 243 00:18:28,540 --> 00:18:33,409 Suze: your beneficiaries inherit it tax free. Then you might consider 244 00:18:33,420 --> 00:18:36,959 Suze: it by going to your CPA and making sure that 245 00:18:36,969 --> 00:18:40,448 Suze: it makes sense in your particular situation. 246 00:18:41,300 --> 00:18:47,229 Suze: Did I answer that question? Maybe so... Darlene... so I would 247 00:18:47,239 --> 00:18:53,099 Suze: not right be recommending you to turn a SEP IRA into 248 00:18:53,109 --> 00:18:57,229 Suze: a Roth at your age if you need the income 249 00:18:57,250 --> 00:19:01,238 Suze: to live on within the next 10 years. 250 00:19:01,420 --> 00:19:05,000 KT: OK, Suze, this one's one of my very favorite questions 251 00:19:05,010 --> 00:19:07,880 KT: and you'll know why in a moment it's from Maria. 252 00:19:07,920 --> 00:19:11,109 KT: She said, hi, Suze. I enjoy listening to you and 253 00:19:11,286 --> 00:19:13,567 KT: really enjoy listening to KT. 254 00:19:13,756 --> 00:19:23,396 Suze: Why is that? So many people saying I really love that KT 255 00:19:23,406 --> 00:19:27,057 Suze: is on the podcast. I love that. I love how 256 00:19:27,946 --> 00:19:29,546 Suze: smoothing her voice is. 257 00:19:29,557 --> 00:19:32,207 KT: But listen to this question. This is why I like it: 258 00:19:32,217 --> 00:19:36,536 KT: a few years back, I learned that PG&E offers after 259 00:19:36,546 --> 00:19:38,107 KT: tax contributions, 260 00:19:38,116 --> 00:19:40,796 Suze: She obviously knew that I used to do the retirement. 261 00:19:41,273 --> 00:19:44,494 KT: So I opted to do that. Now, I have about 262 00:19:44,504 --> 00:19:49,854 KT: 80,000 in after tax contributions. I'm wondering if you're familiar 263 00:19:49,864 --> 00:19:55,754 KT: with PG&Es after tax 401k, what is the difference between 264 00:19:55,763 --> 00:20:01,854 KT: the Roth 401k and after tax 401k? Besides the growth 265 00:20:01,864 --> 00:20:06,933 KT: being taxable? Also, I was told that I can convert 266 00:20:06,943 --> 00:20:10,963 KT: my after tax 401k contribution to my Roth IRA 267 00:20:11,500 --> 00:20:16,281 KT: without fees or penalties. Is this true? How do I 268 00:20:16,291 --> 00:20:22,760 KT: determine if before or after tax contributions are better? So, 269 00:20:23,480 --> 00:20:29,171 KT: just want to say she she joined PG&E in 1999 just 270 00:20:29,181 --> 00:20:33,600 KT: out of college. I love this question and she was 271 00:20:33,609 --> 00:20:37,681 KT: financially illiterate. She grew up, they migrated to America when 272 00:20:37,691 --> 00:20:39,931 KT: she was nine. And I think she's a single mom 273 00:20:39,941 --> 00:20:41,120 KT: because she's asking 274 00:20:41,400 --> 00:20:43,619 KT: how can I teach my eight year old to be 275 00:20:43,630 --> 00:20:49,520 KT: financially independent? Love? Maria? Tell Maria that first, we're proud 276 00:20:49,530 --> 00:20:51,060 KT: of you, Maria. 277 00:20:51,390 --> 00:20:54,469 Suze: It's, we missed each other because I think it was 278 00:20:54,479 --> 00:21:00,139 Suze: about 1993, 1994 was the last time I did things with 279 00:21:00,150 --> 00:21:03,449 Suze: Pacific Gas and Electric because that's when I turned into 280 00:21:03,459 --> 00:21:07,550 Suze: a best selling author and my career just scooted a 281 00:21:07,560 --> 00:21:10,379 Suze: whole different way than retirement planning. 282 00:21:10,930 --> 00:21:15,109 Suze: However, first of all, you will have to check and 283 00:21:15,119 --> 00:21:19,810 Suze: make sure that Pacific Gas and Electric allows you to 284 00:21:19,819 --> 00:21:23,829 Suze: actually take your after tax contributions and put it into 285 00:21:23,839 --> 00:21:29,219 Suze: your Roth 401k that you may have there. If they don't, 286 00:21:29,380 --> 00:21:33,079 Suze: then you can absolutely put it in to a Roth 287 00:21:33,089 --> 00:21:38,209 Suze: IRA when the time is right. Ok. Number one, number two, 288 00:21:38,660 --> 00:21:44,639 Suze: you're far better off doing a Roth 401k from the 289 00:21:44,650 --> 00:21:49,958 Suze: start because your earnings could be substantial. 290 00:21:50,880 --> 00:21:57,530 Suze: Otherwise you're still, if you do an after tax 401k. So, 291 00:21:57,540 --> 00:22:00,479 Suze: all right, you get to put after tax money in, 292 00:22:00,939 --> 00:22:05,560 Suze: but the earnings on that money are still taxable by 293 00:22:05,569 --> 00:22:08,958 Suze: Uncle Sam. So you're still partnering with Uncle Sam. 294 00:22:09,599 --> 00:22:15,020 Suze: You would be so much better doing a Roth 401k 295 00:22:15,030 --> 00:22:16,300 Suze: bar none 296 00:22:17,050 --> 00:22:22,669 Suze: then and after tax 401k, no matter what you think. 297 00:22:22,680 --> 00:22:23,689 Suze: All right, KT. 298 00:22:23,699 --> 00:22:26,430 KT: And my last question is from Maurice. 299 00:22:26,920 --> 00:22:31,819 KT: Your talk on special needs trust was so timely. I 300 00:22:31,829 --> 00:22:36,780 KT: have an adult son who is disabled and getting SSI and 301 00:22:36,790 --> 00:22:41,790 KT: health benefits. Only yesterday, I began learning more about setting 302 00:22:41,800 --> 00:22:45,729 KT: one up. I do have stated in my revocable trust 303 00:22:45,739 --> 00:22:50,000 KT: that all his inheritance will go into a special needs trust. 304 00:22:50,130 --> 00:22:53,699 KT: I have been told this would be established, when I die. 305 00:22:54,229 --> 00:22:57,139 KT: In my reading, there were differing thoughts on setting it 306 00:22:57,150 --> 00:23:01,250 KT: up in advance versus after death when the estate is 307 00:23:01,260 --> 00:23:04,260 KT: being settled. What's your thought about doing this? 308 00:23:04,270 --> 00:23:06,650 Suze: It's funny, I read that one and I wrote this 309 00:23:06,660 --> 00:23:10,609 Suze: person back directly just so, you know, because whenever I 310 00:23:10,619 --> 00:23:13,569 Suze: see something with a special needs trust or a divorce 311 00:23:13,579 --> 00:23:16,479 Suze: or a death, I tend to try to answer them 312 00:23:16,489 --> 00:23:18,938 Suze: personally with an email back. But 313 00:23:19,369 --> 00:23:23,750 Suze: so if others are interested in the answer to this question, 314 00:23:23,930 --> 00:23:28,150 Suze: you should set up in my opinion, a special needs 315 00:23:28,160 --> 00:23:32,680 Suze: trust as soon as you possibly can because things can 316 00:23:32,689 --> 00:23:35,719 Suze: change in your life. Maybe you want to put some 317 00:23:35,729 --> 00:23:40,109 Suze: money in the special needs trust so that your son 318 00:23:40,119 --> 00:23:41,270 Suze: can access that 319 00:23:41,375 --> 00:23:44,464 Suze: money. Now before you have died and all kinds of 320 00:23:44,474 --> 00:23:48,774 Suze: things like that. So do not wait just for the inheritance. 321 00:23:48,785 --> 00:23:51,925 Suze: All right. And have it go through your trust, set 322 00:23:51,935 --> 00:23:55,514 Suze: it up right now. And for those of you wondering 323 00:23:55,525 --> 00:23:58,675 Suze: why do you need a special needs? Trust is because 324 00:23:58,685 --> 00:24:04,895 Suze: most likely his son is on SSI. And if somebody who 325 00:24:04,905 --> 00:24:07,964 Suze: is on SSI, that means they're getting 6 - $700 a 326 00:24:07,974 --> 00:24:09,594 Suze: month or whatever it may be. 327 00:24:09,979 --> 00:24:13,688 Suze: If they're on SSI and they get more than like 328 00:24:13,699 --> 00:24:18,319 Suze: $2000 or whatever it may be, they can get disqualified 329 00:24:18,329 --> 00:24:23,359 Suze: from SSI. If in fact, it goes directly to them, 330 00:24:23,689 --> 00:24:26,280 Suze: there's other little ways around it with an able account. 331 00:24:26,290 --> 00:24:29,188 Suze: And so, but the special thing you should do is 332 00:24:29,199 --> 00:24:31,040 Suze: a special needs trust. 333 00:24:31,810 --> 00:24:33,139 Suze: Is that everything Kate? 334 00:24:33,150 --> 00:24:36,040 KT: That's it. That's a good, that was a good selection. 335 00:24:36,050 --> 00:24:37,829 KT: Don't you think I mixed it up well? 336 00:24:38,550 --> 00:24:39,369 Suze: You did all right. 337 00:24:40,119 --> 00:24:42,530 KT: I thought I did that pretty good. Everybody. 338 00:24:42,540 --> 00:24:46,680 Suze: Oh, look how soft and sweet she became. I love 339 00:24:46,689 --> 00:24:50,589 Suze: how you do it. I actually think you add a 340 00:24:50,599 --> 00:24:53,609 Suze: tremendous amount to this podcast, KT. 341 00:24:53,729 --> 00:24:54,709 KT: Thanks Susie. 342 00:24:54,719 --> 00:24:57,579 KT: No, I'm, I'm not kidding. I think it may be 343 00:24:57,589 --> 00:25:01,369 KT: rough for them to take me every single week. You 344 00:25:01,380 --> 00:25:05,410 KT: want to know why? I think that why I remember 345 00:25:05,819 --> 00:25:08,159 KT: when I first started doing Oprah 346 00:25:08,829 --> 00:25:12,619 Suze: and I got a call from, I think her name 347 00:25:12,630 --> 00:25:16,329 Suze: was Diane Hudson who was Oprah's executive producer. 348 00:25:17,050 --> 00:25:20,239 Suze: And that was during the days, then Doctor Phil was 349 00:25:20,250 --> 00:25:22,800 Suze: gonna be on once a week and Iyanla Vanzant was 350 00:25:22,810 --> 00:25:24,639 Suze: gonna be on once a week and they wanted me 351 00:25:24,650 --> 00:25:29,149 Suze: to be on once a week as well. And anybody 352 00:25:29,160 --> 00:25:31,030 Suze: in their right mind would have said, of course, I'll 353 00:25:31,040 --> 00:25:33,760 Suze: be on Oprah once a week. And I said, no, 354 00:25:33,770 --> 00:25:36,859 Suze: I can't. And she said, why? 355 00:25:37,530 --> 00:25:39,889 Suze: And I said, because if I go on the Oprah 356 00:25:39,900 --> 00:25:44,170 Suze: Winfrey show and talk about money with the intensity that 357 00:25:44,180 --> 00:25:46,889 Suze: I talk about it, everybody's going to end up hating 358 00:25:46,900 --> 00:25:49,069 Suze: me and they're gonna end up not watching anyway 359 00:25:49,750 --> 00:25:54,239 Suze: because money is a difficult subject at times to have 360 00:25:54,250 --> 00:25:57,089 Suze: to listen to all the time to face it. But 361 00:25:57,099 --> 00:26:00,129 Suze: unless you're ready and then, and with a podcast, you 362 00:26:00,140 --> 00:26:03,349 Suze: can listen whenever you're in the mood on the Oprah show, 363 00:26:03,359 --> 00:26:08,250 Suze: you had to watch it that specific day. So, you know, I, 364 00:26:08,260 --> 00:26:10,889 Suze: I think about that with all of you, which is 365 00:26:10,900 --> 00:26:13,510 Suze: why I love doing a podcast. So when you feel 366 00:26:13,520 --> 00:26:16,290 Suze: you're ready, that's when you listen to it 367 00:26:16,770 --> 00:26:21,459 Suze: because money is probably the most important topic of your life. Alright KT! 368 00:26:22,439 --> 00:26:23,228 KT: What's my quizzy? 369 00:26:23,719 --> 00:26:29,319 Suze: Your quizzy is this... now everybody, a quizzy is where 370 00:26:29,329 --> 00:26:33,349 Suze: I asked KT a question, but I'm asking it to 371 00:26:33,359 --> 00:26:35,780 Suze: all of you as well. 372 00:26:36,469 --> 00:26:38,410 Suze: And for a while there we thought, oh, we would 373 00:26:38,420 --> 00:26:41,689 Suze: just end with, can I afford it quizzes? But then 374 00:26:41,699 --> 00:26:44,020 Suze: I was like, no, I have to do all kinds 375 00:26:44,030 --> 00:26:47,958 Suze: of different quizzes. So therefore this is a different kind 376 00:26:47,969 --> 00:26:49,260 Suze: of a little bit of a quizzy. 377 00:26:49,729 --> 00:26:51,430 Suze: But you have to be... 378 00:26:51,439 --> 00:26:54,270 KT: A quizzy is a quizzy. You get it right or 379 00:26:54,280 --> 00:27:00,310 KT: you get it wrong. Ok. Ask me and everyone listening. 380 00:27:00,319 --> 00:27:04,199 Suze: But before you answer KT like, just give people a second. 381 00:27:04,829 --> 00:27:07,319 KT: I'll give you all as much time as it takes me. 382 00:27:09,439 --> 00:27:14,709 Suze: Can I contribute the max every year to a Roth 383 00:27:14,719 --> 00:27:23,959 Suze: IRA and to my SEP IRA and to my Roth 401k. 384 00:27:24,209 --> 00:27:28,500 Suze: Can they put the maximum in per year to all 385 00:27:28,510 --> 00:27:33,500 Suze: three of those accounts? Think about it. Think about it, 386 00:27:39,630 --> 00:27:42,000 Suze: think about it. 387 00:27:42,140 --> 00:27:45,390 KT: (KT sings a little) Remember the little song that you would hear? 388 00:27:45,400 --> 00:27:47,629 Suze: She wants me to give her an idea of what the 389 00:27:48,030 --> 00:27:48,179 Suze: answer is. 390 00:27:49,229 --> 00:27:50,770 KT: I think the answer is no, 391 00:27:52,369 --> 00:27:54,889 KT: I don't think you can, I don't think you can 392 00:27:54,900 --> 00:27:57,140 KT: put a max into all three. 393 00:27:57,150 --> 00:27:57,520 Suze: You don't? 394 00:27:57,930 --> 00:28:01,209 KT: No. Yeah, I don't think you can do that. 395 00:28:01,589 --> 00:28:03,930 Suze: What do all of you think out there? 396 00:28:04,640 --> 00:28:06,189 Suze: Yes or no? (Suze makes the wrong answer noise) 397 00:28:09,150 --> 00:28:13,219 Suze: You can, you absolutely. All three. As long as you 398 00:28:13,229 --> 00:28:18,109 Suze: meet the eligibility requirements for a Roth IRA and all 399 00:28:18,119 --> 00:28:20,599 Suze: the others. Absolutely, you can. 400 00:28:21,030 --> 00:28:23,060 KT: You know why I don't know the answer to that? 401 00:28:23,199 --> 00:28:24,409 Suze: Because you don't have a SEP IRA? 402 00:28:25,000 --> 00:28:26,050 KT: I have a SEP IRA, 403 00:28:27,489 --> 00:28:30,170 KT: and when I opened, I remember when I opened my 404 00:28:30,180 --> 00:28:34,479 KT: first SEP IRA , when I came back to America I said, um, 405 00:28:34,489 --> 00:28:36,069 KT: Len looked at me and said, do you want to 406 00:28:36,079 --> 00:28:38,640 KT: put the max in every year? I said, sure, why not? 407 00:28:40,050 --> 00:28:43,890 KT: And that's all I did. But I don't remember putting, 408 00:28:44,219 --> 00:28:47,810 KT: you just don't know, don't, you can only put a... 409 00:28:49,229 --> 00:28:52,290 Suze: Stop, stop, you're wrong. Once a year. Do you, do 410 00:28:52,300 --> 00:28:53,209 Suze: you understand what? 411 00:28:53,290 --> 00:28:54,750 KT: Yeah, once a year. 412 00:28:55,479 --> 00:28:59,949 Suze: But it all adds to all of those if you want. Absolutely. 413 00:28:59,959 --> 00:29:01,229 KT: Ok. I didn't know that. 414 00:29:01,319 --> 00:29:04,469 Suze: Right. Do you know the maximum amount for SEP IRA 415 00:29:04,479 --> 00:29:05,489 Suze: that you can put in? 416 00:29:06,390 --> 00:29:08,510 KT: Oh, it was a lot of money this year. 417 00:29:08,520 --> 00:29:09,739 Suze: Do you know what the max is? 418 00:29:09,849 --> 00:29:10,839 KT: I have no clue. 419 00:29:10,849 --> 00:29:11,750 Suze: Is that your other quizzy? 420 00:29:12,439 --> 00:29:13,439 KT: How much is it? 421 00:29:13,619 --> 00:29:17,150 Suze: I'll give you a choice. All right, the maximum that 422 00:29:17,160 --> 00:29:22,010 Suze: one can put in a SEP IRA is if you're self-employed 423 00:29:22,020 --> 00:29:25,250 Suze: is 20% of your net income 424 00:29:26,119 --> 00:29:34,949 Suze: or either 30,000 a year, 40,000 a year, $69,000 a year, 425 00:29:34,959 --> 00:29:41,430 Suze: whichever one is less. So, 20% of your net income 426 00:29:42,109 --> 00:29:42,880 Suze: or 427 00:29:43,650 --> 00:29:49,020 Suze: 30,000 a year, 40,000 a year or 69,000 a year. 428 00:29:49,030 --> 00:29:53,760 KT: Whichever one is, I think it's the highest amount. 69,000. 429 00:29:54,390 --> 00:29:55,979 KT: I used to put a lot in! 430 00:29:56,229 --> 00:29:59,589 Suze: Ding, ding, ding. She did it. Everybody. 431 00:30:00,369 --> 00:30:01,449 KT: I got that one right. 432 00:30:01,459 --> 00:30:06,229 Suze: Oh, see, at least now she's happy. Which makes me happy. 433 00:30:06,810 --> 00:30:07,560 Suze: All right. 434 00:30:07,589 --> 00:30:11,069 KT: I wish we were celebrating Mika's birthday with her today. 435 00:30:11,930 --> 00:30:15,380 KT: We're so far apart. We're out on this little island 436 00:30:15,390 --> 00:30:19,390 KT: and she's way up north anyway. Happy birthday, Mika. 437 00:30:19,479 --> 00:30:23,550 Suze: And I'm gonna do something that I probably shouldn't be 438 00:30:23,560 --> 00:30:25,160 Suze: doing right now. 439 00:30:26,000 --> 00:30:29,339 Suze: But I'm going to anyway. All right. Do you know 440 00:30:29,349 --> 00:30:32,979 Suze: how I've been telling all of you to go to 441 00:30:32,989 --> 00:30:37,410 Suze: my alliant.com? And by the way, for those of you 442 00:30:37,420 --> 00:30:41,349 Suze: who keep getting confused and you're going to Alliant Credit 443 00:30:41,359 --> 00:30:44,829 Suze: union.com and you can't find the quizzy because I didn't 444 00:30:44,839 --> 00:30:48,260 Suze: tell you to go to Alliant Credit union.com. I'm telling 445 00:30:48,270 --> 00:30:54,729 Suze: you to go to my Alliant A lliant.com 446 00:30:55,180 --> 00:31:00,180 Suze: because this is only for Suze people, right? And I 447 00:31:00,189 --> 00:31:02,209 Suze: want you to go there and remember I've been telling 448 00:31:02,229 --> 00:31:07,319 Suze: you go there and take the quiz questions and then 449 00:31:07,329 --> 00:31:09,640 Suze: put in your email address 450 00:31:10,359 --> 00:31:13,780 Suze: and a lot of you are saying why Suze whatever? 451 00:31:13,819 --> 00:31:18,800 Suze: Because they will officially announce this on May 6th, but 452 00:31:18,810 --> 00:31:22,900 Suze: I'm doing it today. I don't care, right? Because my 453 00:31:22,910 --> 00:31:26,420 Suze: next podcast is May 5th. So that's still before the 454 00:31:26,430 --> 00:31:27,930 Suze: official start date. 455 00:31:28,410 --> 00:31:31,319 Suze: But for all of you who have already done it, 456 00:31:31,329 --> 00:31:33,160 Suze: you don't have to buy anything. You don't have to 457 00:31:33,170 --> 00:31:35,579 Suze: open up an account you don't have to do and 458 00:31:35,680 --> 00:31:38,170 Suze: take the quiz, take the quizz at the end of 459 00:31:38,180 --> 00:31:41,160 Suze: the quiz, then you have the ability to enter your 460 00:31:41,170 --> 00:31:41,709 Suze: email 461 00:31:42,530 --> 00:31:46,670 Suze: On June 5th, which is my birthday and the end 462 00:31:46,680 --> 00:31:51,800 Suze: of your ability to do this. Guess what everybody? One 463 00:31:51,810 --> 00:31:55,469 Suze: of you will be chosen... your email and you will 464 00:31:55,479 --> 00:32:00,109 Suze: win $5000. 465 00:32:00,140 --> 00:32:01,650 KT: Can you tell everyone that? 466 00:32:01,660 --> 00:32:03,290 Suze: I'm not supposed to now. 467 00:32:03,300 --> 00:32:03,829 KT: Are you, are you, are you, is it ok to say that? 468 00:32:06,479 --> 00:32:07,229 Suze: I just did. 469 00:32:07,420 --> 00:32:08,410 KT: I don't know, Suze. 470 00:32:08,479 --> 00:32:10,910 Suze: It's all right. I want them to know why I 471 00:32:10,920 --> 00:32:14,420 Suze: keep saying it. So just do it. Can you do 472 00:32:14,430 --> 00:32:17,609 Suze: me a favor? You know, just do it. 473 00:32:17,619 --> 00:32:19,680 KT: I don't think you're allowed to jump the gun. 474 00:32:20,119 --> 00:32:21,910 Suze: They, they've been jumping the gun 475 00:32:21,984 --> 00:32:26,005 Suze: and everybody who did it already for the past few weeks, 476 00:32:26,025 --> 00:32:30,525 Suze: they're automatically entered all of their friends. They told whatever 477 00:32:30,535 --> 00:32:34,775 Suze: they're all automatically entered, but only if you left a 478 00:32:34,795 --> 00:32:39,525 Suze: legitimate email and you can only take the quiz once. 479 00:32:40,020 --> 00:32:43,410 KT: All right. And it doesn't matter if you get anything wrong, 480 00:32:43,579 --> 00:32:46,589 KT: it doesn't matter. It's not a quiz like it's just 481 00:32:46,609 --> 00:32:50,150 KT: to see it. Its not like the quiz she gives me? 482 00:32:50,160 --> 00:32:53,680 KT: It's really a good 15 questions. Ok. How are we 483 00:32:53,689 --> 00:32:55,930 KT: gonna end this? How are you gonna wrap it, Suze? 484 00:32:56,000 --> 00:32:56,709 Suze: So 485 00:32:57,239 --> 00:33:00,349 Suze: there's only one thing that matters when it comes to 486 00:33:00,359 --> 00:33:02,670 Suze: your money and what is it, KT? 487 00:33:02,680 --> 00:33:06,369 KT: People first, then money, then things 488 00:33:06,420 --> 00:33:11,489 Suze: and $5000. And if you leave your email and if 489 00:33:11,500 --> 00:33:15,189 Suze: you do that one of you, but all of you 490 00:33:15,199 --> 00:33:19,479 Suze: really will be unstoppable.