1 00:00:07,780 --> 00:00:08,529 Suze: What's the date, KT? 2 00:00:08,750 --> 00:00:11,109 KT: Good morning, Suze. It's November 6th. 3 00:00:11,420 --> 00:00:11,969 Suze: Are you positive? 4 00:00:12,270 --> 00:00:12,619 KT: Yes. 5 00:00:12,750 --> 00:00:14,020 Suze: You know what that means, don't you? 6 00:00:14,270 --> 00:00:14,590 KT: Yes. 7 00:00:14,750 --> 00:00:15,579 Suze: What does it mean? 8 00:00:15,819 --> 00:00:17,468 KT: We're close to Thanksgiving. 9 00:00:19,909 --> 00:00:22,829 Suze: We're always close to, we're always close to a holiday. 10 00:00:22,950 --> 00:00:23,889 Suze: Why is that, KT? 11 00:00:23,989 --> 00:00:27,190 KT: I love, I love parties. I love to celebrate. I 12 00:00:27,190 --> 00:00:29,879 KT: love gatherings. Suze does not. 13 00:00:31,420 --> 00:00:33,139 Suze: That's the truth. That's the God honest truth. 14 00:00:33,139 --> 00:00:34,610 Suze: Does that surprise all of you? 15 00:00:35,459 --> 00:00:35,513 KT: Yes. 16 00:00:35,513 --> 00:00:36,778 Suze: Do you think it surprises them? 17 00:00:37,180 --> 00:00:41,560 KT: Yes, it does. You're such a social person. You're so happy. 18 00:00:41,860 --> 00:00:44,459 KT: You know, you're full of life, and yet you love 19 00:00:44,459 --> 00:00:46,270 KT: to be alone with me. That's it. 20 00:00:47,389 --> 00:00:49,860 Suze: That's it. For every birthday that I have, everybody, and then 21 00:00:49,860 --> 00:00:52,619 Suze: we'll start this podcast. KT says. 22 00:00:53,159 --> 00:00:54,849 Suze: What should we do? Like, for instance... 23 00:00:54,970 --> 00:00:58,889 KT: For milestones, we, we did, I did sneak in one 24 00:00:58,889 --> 00:00:59,810 KT: great party... 25 00:01:00,009 --> 00:01:03,659 Suze: When I was 60, but now in June, which is 26 00:01:03,659 --> 00:01:08,129 Suze: not that far away, I'm gonna be 75, and KT wants to... 27 00:01:08,129 --> 00:01:11,809 KT: I'm planning. I wanna make a big party, but no... 28 00:01:11,809 --> 00:01:12,849 Suze: What does Suze say? 29 00:01:13,000 --> 00:01:14,750 KT: She said, I just wanna be with you. 30 00:01:15,569 --> 00:01:17,910 KT: So now we're gonna have a big party, just the 31 00:01:17,910 --> 00:01:20,959 KT: two of us. I won't tell them what we're doing 32 00:01:20,959 --> 00:01:23,369 KT: because it's a surprise for you. 33 00:01:23,529 --> 00:01:26,239 Suze: It's for me that I asked her for anyway, that's 34 00:01:26,239 --> 00:01:27,300 Suze: besides the point. 35 00:01:27,410 --> 00:01:30,160 KT: All right, let's get on with this. Welcome to the 36 00:01:30,160 --> 00:01:34,129 KT: Women and Money podcast, and everyone smart enough to listen. 37 00:01:34,569 --> 00:01:36,849 Suze: KT, do you think we think we need to change 38 00:01:36,849 --> 00:01:37,410 Suze: the name. 39 00:01:37,949 --> 00:01:40,699 KT: To the women, to the pod to the money podcast. 40 00:01:40,879 --> 00:01:44,519 Suze: No, to the people's podcast, to the some podcast that 41 00:01:44,519 --> 00:01:45,440 Suze: isn't just exclusive. 42 00:01:45,639 --> 00:01:47,220 KT: The People's Money Podcast... 43 00:01:47,599 --> 00:01:48,199 Suze: The People's Money... that's boring. 44 00:01:48,239 --> 00:01:51,239 KT: The Money Podcast for People. 45 00:01:52,540 --> 00:01:56,459 Suze: That's very funny, KT. That's gonna be the Money Podcast 46 00:01:56,459 --> 00:01:59,699 Suze: for People. I kind of like that no matter who 47 00:01:59,699 --> 00:02:03,819 Suze: you are anyway, for right now, however, this is the 48 00:02:03,819 --> 00:02:07,459 Suze: Ask KT and Suze edition, anything. And if you have 49 00:02:07,459 --> 00:02:10,380 Suze: a question, all you have to do is write into 50 00:02:10,380 --> 00:02:13,919 Suze: ask Suze podcast at gmail.com. 51 00:02:14,500 --> 00:02:19,228 Suze: And if KT chooses it, oh, I'll, I'll, I'll maybe 52 00:02:19,229 --> 00:02:19,509 Suze: answer 53 00:02:19,508 --> 00:02:19,899 Suze: it as well. 54 00:02:19,990 --> 00:02:22,829 KT: No, this is my first question is great. Ready? 55 00:02:23,309 --> 00:02:24,220 KT: Hello, Suze. 56 00:02:24,220 --> 00:02:24,770 Suze: You just interrupted me. 57 00:02:25,589 --> 00:02:28,270 KT: I did because, because I, I wanna get on with it. 58 00:02:28,389 --> 00:02:30,839 KT: I've got, I wanna get on with it 59 00:02:30,839 --> 00:02:31,899 Suze: Why? Because you got things to do? 60 00:02:31,960 --> 00:02:34,610 KT: I do, Thanksgiving's coming up. 61 00:02:35,820 --> 00:02:40,869 KT: OK, hello, Suze and KT. This is from Denise. Everyone, 62 00:02:41,389 --> 00:02:45,638 KT: please remind me of the podcast that went over how 63 00:02:45,669 --> 00:02:49,788 KT: to split money for bills. My husband makes less money 64 00:02:49,788 --> 00:02:52,990 KT: than I do. We currently split it in half, but 65 00:02:52,990 --> 00:02:56,269 KT: it may not be fair. I heard a podcast that 66 00:02:56,270 --> 00:03:00,809 KT: gave a mathematical equation as to how to solve this. 67 00:03:01,389 --> 00:03:03,589 KT: Let's tell her to do it the way we do it. 68 00:03:04,279 --> 00:03:06,178 KT: Suze pays for everything. 69 00:03:08,479 --> 00:03:10,070 KT: That's not true. 70 00:03:10,429 --> 00:03:13,229 Suze: No, we split the money that comes in, and then 71 00:03:13,229 --> 00:03:17,429 Suze: it is true that I pay for 95% of 72 00:03:17,429 --> 00:03:17,830 Suze: everything, 73 00:03:18,139 --> 00:03:20,649 KT: yeah, but you didn't tell her how we split it. 74 00:03:22,300 --> 00:03:24,190 KT: It's not 50/50, baby. 75 00:03:24,270 --> 00:03:28,429 Suze: No, but 75/25 doesn't equate to me paying for 95 76 00:03:28,429 --> 00:03:34,550 Suze: to 99%. However, everybody, I love paying for everything. I 77 00:03:34,550 --> 00:03:35,149 Suze: don't mind... 78 00:03:35,149 --> 00:03:38,289 KT: If she doesn't like something. She's, KT, you're paying for that. 79 00:03:38,350 --> 00:03:39,139 KT: I say, OK. 80 00:03:40,190 --> 00:03:44,199 Suze: And then we do that. But seriously, you know, we 81 00:03:44,199 --> 00:03:46,800 Suze: have to figure out, obviously, this is just going to 82 00:03:46,800 --> 00:03:49,039 Suze: be a podcast of me and KT talking to each 83 00:03:49,039 --> 00:03:50,619 Suze: other and Robert. 84 00:03:51,020 --> 00:03:54,210 Suze: Which is Robert, we have to figure out a way 85 00:03:54,630 --> 00:03:57,229 Suze: that people can just go on, put in what they're 86 00:03:57,229 --> 00:04:01,669 Suze: looking for, and up comes the podcast they're looking for, 87 00:04:01,710 --> 00:04:05,589 Suze: because I don't know that which one that podcast is in. 88 00:04:05,669 --> 00:04:09,339 KT: So she's also given that advice a number of times, 89 00:04:09,550 --> 00:04:10,750 KT: and we're about to do it again right now. 90 00:04:10,750 --> 00:04:15,470 Suze: So here you go, Denise, just for you. 91 00:04:15,929 --> 00:04:20,450 Suze: Let's say you make $7,000 a month. Let's say your 92 00:04:20,450 --> 00:04:25,609 Suze: spouse makes $3,000 a month, you'd add those two totals together, 93 00:04:25,690 --> 00:04:31,899 Suze: that's $10,000 and you divide that into whatever your monthly 94 00:04:32,119 --> 00:04:35,720 Suze: expenses happen to be that you share. Let's just make 95 00:04:35,720 --> 00:04:40,410 Suze: this ridiculous and say it's $3,000 a month is what 96 00:04:40,559 --> 00:04:46,589 Suze: you share. Therefore, you divide $10,000 into $3,000 and that 97 00:04:46,589 --> 00:04:53,118 Suze: will be 30%. Therefore, you then at $7,000 pay 30% 98 00:04:53,119 --> 00:04:58,229 Suze: of that $7,000 which is $2,100 a month. Your husband, 30% 99 00:04:58,230 --> 00:05:01,599 Suze: of that $3,000 is $900 a month. 100 00:05:01,940 --> 00:05:09,308 Suze: And there is your $3,000. Equal percentages, not equal amounts 101 00:05:09,309 --> 00:05:10,510 Suze: of money. Next question KT. 102 00:05:10,670 --> 00:05:15,950 KT: OK, this is from Debbie. Good morning. I am 66 103 00:05:15,950 --> 00:05:17,130 KT: and retired. 104 00:05:17,230 --> 00:05:18,019 Suze: Good for you. 105 00:05:18,230 --> 00:05:19,988 KT: I've been using ML... 106 00:05:19,988 --> 00:05:20,180 Suze: ML is Merrill Lynch. 107 00:05:20,180 --> 00:05:23,349 KT: ...for my advisor for over 25 years. 108 00:05:23,928 --> 00:05:26,739 KT: Now that I'm retired and have been really trying to 109 00:05:26,738 --> 00:05:30,079 KT: get on my game, I realized how much those fees 110 00:05:30,220 --> 00:05:36,380 KT: are costing me. I pay 1.23%, ready, everyone, which is 111 00:05:36,380 --> 00:05:41,058 KT: about $15,000 a year. She has a lot of money 112 00:05:41,059 --> 00:05:42,178 KT: they're looking after. 113 00:05:42,609 --> 00:05:46,070 KT: There are perks because they are linked to Bank of America. 114 00:05:46,320 --> 00:05:47,399 Suze: That's not a perk. 115 00:05:47,500 --> 00:05:50,809 KT: Well, hold on, hold on, hold on. I really can't 116 00:05:50,809 --> 00:05:53,149 KT: see the value anymore. Previously... 117 00:05:53,149 --> 00:05:54,250 Suze: Good for you, Debbie. 118 00:05:54,880 --> 00:05:57,369 KT: Previously I worked a lot. I didn't have time to 119 00:05:57,369 --> 00:06:01,609 KT: manage my own money. Vanguard's fees are about a third of 120 00:06:01,609 --> 00:06:06,019 KT: that and nothing if I self-direct. Should I take the leap? 121 00:06:06,290 --> 00:06:07,250 KT: Please advise. 122 00:06:07,829 --> 00:06:10,630 KT: Not only should you take the leap, you don't need 123 00:06:10,630 --> 00:06:11,828 KT: Vanguard either. 124 00:06:12,470 --> 00:06:16,219 Suze: You know, Debbie, obviously I think you should manage the 125 00:06:16,220 --> 00:06:21,190 Suze: money yourself, but it's not my money, it is your money, 126 00:06:21,510 --> 00:06:25,469 Suze: and it's going to manage 1.2 million because if you're 127 00:06:25,470 --> 00:06:29,350 Suze: paying 15,000 a year at 1.25%, that means you have 128 00:06:29,350 --> 00:06:32,988 Suze: approximately 1.2 million at Merrill Lynch. 129 00:06:33,940 --> 00:06:36,700 Suze: Is that gonna make you nervous? Do you know what 130 00:06:36,700 --> 00:06:40,160 Suze: you would invest in? Can you just simply take everything 131 00:06:40,160 --> 00:06:43,260 Suze: that it's already invested in, if you like what it's 132 00:06:43,260 --> 00:06:47,040 Suze: invested in, and transfer that to like Schwab or Fidelity 133 00:06:47,040 --> 00:06:50,260 Suze: or even Vanguard, and then just manage it from there? 134 00:06:50,820 --> 00:06:54,500 Suze: How much did you have to do with that? Could 135 00:06:54,500 --> 00:06:59,940 Suze: you use that extra $15,000 a year? Could you? You 136 00:06:59,940 --> 00:07:03,899 Suze: probably could. Is this outside of a retirement account, inside 137 00:07:03,899 --> 00:07:07,170 Suze: a retirement account? What do you have going on there? 138 00:07:07,420 --> 00:07:09,600 Suze: Do they help you with tax planning and how much 139 00:07:09,600 --> 00:07:11,899 Suze: you should convert? And I can go on and on 140 00:07:11,899 --> 00:07:16,700 Suze: and on. So, the other thing is this: maybe you 141 00:07:16,700 --> 00:07:18,339 Suze: don't do it all at once. 142 00:07:18,920 --> 00:07:22,200 Suze: Maybe you take a third of it and you transfer 143 00:07:22,200 --> 00:07:25,420 Suze: it and you see how that feels or then maybe 144 00:07:25,959 --> 00:07:28,380 Suze: some more, whatever it may be, or you talk to 145 00:07:28,380 --> 00:07:32,359 Suze: this person if this person has been doing really, really 146 00:07:32,359 --> 00:07:35,559 Suze: well for you and you feel secure with this person 147 00:07:35,559 --> 00:07:38,279 Suze: or whatever it may be, maybe you talk to them 148 00:07:38,279 --> 00:07:39,359 Suze: and you say, you know what... 149 00:07:40,029 --> 00:07:43,589 Suze: I'm going to leave you unless you only charge me 0.5% 150 00:07:43,589 --> 00:07:46,429 Suze: to manage this money because the truth is we don't 151 00:07:46,429 --> 00:07:49,029 Suze: change it much. Do you have bonds? You shouldn't be 152 00:07:49,029 --> 00:07:52,549 Suze: paying any percentage if you're investing in bonds. You're going 153 00:07:52,549 --> 00:07:55,470 Suze: to have to make this decision. You might want to 154 00:07:55,470 --> 00:07:59,890 Suze: take 300,000 and see what you do with that 300,000 155 00:07:59,890 --> 00:08:02,670 Suze: or take it in kind so you don't have a 156 00:08:02,670 --> 00:08:06,570 Suze: taxable event, again unless this is a retirement account. So 157 00:08:06,750 --> 00:08:09,709 Suze: you're going to have to make this decision yourself. But again, 158 00:08:11,119 --> 00:08:14,279 Suze: you're never powerful in life until you're powerful over your 159 00:08:14,279 --> 00:08:17,250 Suze: own money, how you think about it, how you feel 160 00:08:17,250 --> 00:08:21,920 Suze: about it, and how you invest it. Just that simple. 161 00:08:22,760 --> 00:08:23,089 KT: Suze, 162 00:08:23,160 --> 00:08:27,320 KT: next question is from Scott. Scott, I want to go 163 00:08:27,320 --> 00:08:28,200 KT: to Scotland. 164 00:08:28,450 --> 00:08:28,899 Suze: Why? 165 00:08:29,279 --> 00:08:32,859 KT: I want to go fishing in Scotland and golfing. 166 00:08:33,239 --> 00:08:35,039 Suze: Oh, we're gonna go golfing. Does that mean we have 167 00:08:35,039 --> 00:08:36,109 Suze: to take our golf clubs 168 00:08:36,109 --> 00:08:36,440 Suze: all the way? 169 00:08:36,549 --> 00:08:38,919 KT: No, no, no, you can just rent them. We're not 170 00:08:38,919 --> 00:08:39,520 KT: that good. 171 00:08:41,510 --> 00:08:42,109 KT: Hi Suze. 172 00:08:42,190 --> 00:08:43,289 Suze: Although tell everybody 173 00:08:43,289 --> 00:08:43,859 Suze: how good I am. 174 00:08:43,950 --> 00:08:48,289 KT: Suze's really a great golfer. Colo and I can't believe 175 00:08:48,549 --> 00:08:51,409 KT: how she can drive that ball straight down the fairway, 176 00:08:51,659 --> 00:08:54,030 KT: and he and I end up in the lake. We, 177 00:08:54,150 --> 00:08:56,429 KT: we end up in the trees. We have to search 178 00:08:56,429 --> 00:08:59,950 KT: in the woods, but Suze, bam, and she doesn't even 179 00:08:59,950 --> 00:09:03,650 KT: do a practice swing. That's, that's the, that's the part 180 00:09:03,650 --> 00:09:06,849 KT: that we don't get. We, we practice like 10 swings. 181 00:09:07,489 --> 00:09:10,250 KT: And wiggle. We do everything that the pros do, but 182 00:09:10,250 --> 00:09:12,929 KT: Suze just gets up there with a pair of flip 183 00:09:12,929 --> 00:09:17,049 KT: flops on and bam, hits that ball. All right, ready? Hi, Suze, 184 00:09:17,130 --> 00:09:20,000 KT: I'm retiring in about a year and thanks to you, 185 00:09:20,090 --> 00:09:23,650 KT: I've done very well with my retirement savings. 186 00:09:24,030 --> 00:09:28,330 KT: I'm about to rebalance my retirement account and I'm wondering 187 00:09:28,330 --> 00:09:31,280 KT: if I really need to do a 60/40 balance or 188 00:09:32,309 --> 00:09:36,848 KT: if I could do something more like 80/20. If 20% 189 00:09:37,030 --> 00:09:40,020 KT: of my retirement savings were in cash and bonds, 190 00:09:40,554 --> 00:09:43,775 KT: I could live on that amount of money very comfortably 191 00:09:43,965 --> 00:09:47,674 KT: for five years, six if I'm careful. Which is making 192 00:09:47,674 --> 00:09:51,934 KT: me wonder why I would have 40% of my account 193 00:09:52,395 --> 00:09:54,664 KT: in slow growth investments. 194 00:09:55,195 --> 00:09:56,135 Suze: Scott boy, 195 00:09:57,114 --> 00:09:58,034 KT: Scotty, Scotty, 196 00:09:58,145 --> 00:09:59,994 Suze: Scotty, do you want to go to Scotland with us? 197 00:10:00,875 --> 00:10:03,994 Suze: You can do anything you want. There are no formulas 198 00:10:03,994 --> 00:10:06,244 Suze: that I want you to really follow. 199 00:10:06,599 --> 00:10:09,440 Suze: You know, maybe I give generic advice and things when 200 00:10:09,440 --> 00:10:13,940 Suze: a lot of people are listening or reading, but truthfully, 201 00:10:14,119 --> 00:10:18,200 Suze: I want you all to invest what you feel you 202 00:10:18,200 --> 00:10:23,699 Suze: should do according to you, period. If you wanted 100% 203 00:10:23,700 --> 00:10:26,159 Suze: of your money in the market, honest to God. 204 00:10:26,609 --> 00:10:30,419 Suze: And you knew that you had enough in cash to 205 00:10:30,419 --> 00:10:34,590 Suze: carry you for three to five years of expenses above 206 00:10:34,590 --> 00:10:38,260 Suze: your income, Social Security, all of those things. I don't 207 00:10:38,260 --> 00:10:39,179 Suze: care if you do that. 208 00:10:39,950 --> 00:10:43,039 Suze: But you have to know that you're willing to risk, 209 00:10:43,039 --> 00:10:45,559 Suze: what you're not willing to risk, what you want to 210 00:10:45,559 --> 00:10:49,349 Suze: keep safe, and what you don't want to keep safe. So, 211 00:10:49,409 --> 00:10:54,380 Suze: it's really totally up to you. You can do anything 212 00:10:54,380 --> 00:10:55,478 Suze: you want, cause it's 213 00:10:55,609 --> 00:10:59,369 Suze: your money. And I know conventional wisdom would say, no, no, 214 00:10:59,489 --> 00:11:02,690 Suze: you have to be conservative, you have to be Scotty 215 00:11:02,690 --> 00:11:07,569 Suze: and do what makes sense for you in your particular situation. All right. 216 00:11:07,570 --> 00:11:12,250 KT: OK, my next question is from Jill and Jill said, 217 00:11:12,369 --> 00:11:16,489 KT: hi Suze and KT. Ready? I love the opening. My 218 00:11:16,489 --> 00:11:17,940 KT: sweetheart and I. 219 00:11:18,489 --> 00:11:21,900 KT: Both 53 and together for five years. 220 00:11:21,979 --> 00:11:22,130 Suze: What did you like about that opening? 221 00:11:24,219 --> 00:11:25,409 KT: My sweetheart and I. 222 00:11:25,460 --> 00:11:26,260 Suze: I never call you sweetheart. 223 00:11:26,260 --> 00:11:29,630 KT: No, but Jill is calling her, her... 224 00:11:29,979 --> 00:11:31,679 Suze: Does that mean you want me to call you sweetheart? 225 00:11:32,059 --> 00:11:34,169 KT: You call me sweetheart sometimes, but not 226 00:11:34,169 --> 00:11:34,520 KT: really. 227 00:11:36,059 --> 00:11:36,299 KT: All right, 228 00:11:36,419 --> 00:11:36,500 KT: so. 229 00:11:37,229 --> 00:11:41,390 KT: My sweetheart and I, both 53 and together for five years, 230 00:11:41,630 --> 00:11:45,909 KT: have been devoted listeners for two years now. Your podcast 231 00:11:45,909 --> 00:11:51,630 KT: has sparked honest financial conversations between us and continues to 232 00:11:51,630 --> 00:11:54,909 KT: help us prepare for retirement. Thank you. 233 00:11:55,760 --> 00:11:57,239 KT: Now, here's our dilemma. 234 00:11:59,750 --> 00:12:04,309 KT: We live and earn modestly with similar incomes and comparable 235 00:12:04,309 --> 00:12:11,270 KT: retirement savings. I own a $333,000 home outright. He owns 236 00:12:11,270 --> 00:12:16,630 KT: a slightly less valued one with a $110,000 mortgage. We 237 00:12:16,630 --> 00:12:20,239 KT: eventually want to share a home and grow old together, 238 00:12:20,469 --> 00:12:24,109 KT: but neither of us want to marry again. Probably smart. 239 00:12:24,809 --> 00:12:27,738 Suze: That isn't smart. Why don't they want to marry again? 240 00:12:27,919 --> 00:12:29,650 KT: I don't know if we both ready, 241 00:12:29,979 --> 00:12:31,580 Suze: So many advantages. All right, go on. 242 00:12:31,669 --> 00:12:34,539 KT: OK, if we both sell and buy a home together 243 00:12:34,539 --> 00:12:38,539 KT: as tenants in common, the surviving partner could end up 244 00:12:38,539 --> 00:12:43,359 KT: owning a house with the other's adult children, a potentially 245 00:12:43,359 --> 00:12:47,940 KT: awkward and complicated setup. If he sells his home, moves 246 00:12:47,940 --> 00:12:51,580 KT: in with me, and splits expenses, he'd be contributing to 247 00:12:51,580 --> 00:12:53,140 KT: a house he doesn't own. 248 00:12:53,570 --> 00:12:56,510 KT: On the other hand, he gets to invest the proceeds 249 00:12:56,690 --> 00:13:00,130 KT: from selling his home, while mine would remain tied up 250 00:13:00,130 --> 00:13:03,409 KT: in equity, and that feels unbalanced too. 251 00:13:04,039 --> 00:13:08,718 KT: Suze, how can an unmarried couple build a shared life 252 00:13:08,719 --> 00:13:15,770 KT: financially and emotionally without risking fairness, equity, or future security? 253 00:13:16,159 --> 00:13:17,210 Suze: How long have they been together? 254 00:13:17,359 --> 00:13:21,140 KT: Five years now. Wait, just five, and they're both 53. 255 00:13:21,239 --> 00:13:25,020 KT: So I'm gonna make an assumption that they both had 256 00:13:25,400 --> 00:13:31,039 KT: possibly miserable divorces or separations or whatever, and now... 257 00:13:31,539 --> 00:13:36,390 KT: They just want to be free together and happy, but fair. 258 00:13:36,820 --> 00:13:39,140 Suze: Jill, this is a little bit of a hard one 259 00:13:39,140 --> 00:13:43,140 Suze: because really it all boils down to trust. And even 260 00:13:43,140 --> 00:13:48,099 Suze: though he's your sweetheart, the truth of the matter is 261 00:13:48,099 --> 00:13:51,659 Suze: you've only been together five years, and I'm so sorry 262 00:13:51,659 --> 00:13:56,059 Suze: to say in my book, five years is such a 263 00:13:56,059 --> 00:13:58,539 Suze: short period of time. 264 00:13:59,010 --> 00:14:02,270 Suze: If you told me that you had been together 25 years, 265 00:14:02,500 --> 00:14:05,978 Suze: I would have said something different, but I think the 266 00:14:05,979 --> 00:14:10,099 Suze: best thing to do in this situation is let him 267 00:14:10,099 --> 00:14:14,760 Suze: sell his house. Let him invest all of that money. 268 00:14:15,419 --> 00:14:20,260 Suze: He moves into your home and he splits whatever expenses 269 00:14:20,260 --> 00:14:23,659 Suze: you want to be split with him, and that's how 270 00:14:23,659 --> 00:14:26,299 Suze: you do it, and the house remains in your name, 271 00:14:26,419 --> 00:14:27,700 Suze: hopefully in trust. 272 00:14:28,429 --> 00:14:31,559 Suze: And the thing is, is that if it's just in 273 00:14:31,559 --> 00:14:36,239 Suze: your name, you could give him a life estate in 274 00:14:36,239 --> 00:14:40,640 Suze: your trust that says if you were to die he 275 00:14:40,640 --> 00:14:43,799 Suze: is allowed to live there for as long as he 276 00:14:43,799 --> 00:14:45,500 Suze: wants to live there. 277 00:14:46,460 --> 00:14:49,150 Suze: Obviously he would have to pay expenses and pay to 278 00:14:49,150 --> 00:14:50,890 Suze: live there if he wanted to. 279 00:14:51,859 --> 00:14:55,390 Suze: And upon his death or when he moves out. 280 00:14:56,049 --> 00:15:00,059 Suze: Again, it all goes to your kids. That's probably how 281 00:15:00,059 --> 00:15:01,900 Suze: I would do it if I were you. 282 00:15:02,599 --> 00:15:05,530 Suze: But I think your concerns are valid, and I think 283 00:15:05,530 --> 00:15:11,700 Suze: they're really, really intelligent. So therefore let him sell his house. 284 00:15:12,080 --> 00:15:15,169 Suze: You keep yours, put it in trust. Give him a 285 00:15:15,169 --> 00:15:18,130 Suze: life estate or a life estate for x amount of years. 286 00:15:18,250 --> 00:15:21,890 Suze: Make sure you state that in your trust, and then 287 00:15:21,890 --> 00:15:24,849 Suze: everything upon the time of him moving out or he 288 00:15:24,849 --> 00:15:29,010 Suze: dies goes to your children. Just that easy. 289 00:15:29,380 --> 00:15:31,380 Suze: All right, KT, next question. 290 00:15:32,500 --> 00:15:36,299 KT: Ok, next question is from Laura. Susie, I'm hoping you 291 00:15:36,299 --> 00:15:40,179 KT: can help me. My father has left in his will 292 00:15:40,419 --> 00:15:46,119 KT: that I am to inherit his home and everything not mentioned. Hmm. Ok... 293 00:15:48,770 --> 00:15:50,200 Suze: Everything that he didn't designate in 294 00:15:50,200 --> 00:15:50,789 Suze: his will, KT. 295 00:15:50,789 --> 00:15:56,659 KT: And his four stepdaughters. Whoa, this sounds like a Cinderella question. 296 00:15:56,960 --> 00:16:02,840 KT: His four stepdaughters are to inherit $25,000 each. I want 297 00:16:02,840 --> 00:16:07,260 KT: to honor his wishes. His wife passed six years ago, 298 00:16:07,559 --> 00:16:11,580 KT: and he never removed her name from the deed. Hmm. 299 00:16:12,359 --> 00:16:15,320 KT: I encouraged him to set up a trust six weeks 300 00:16:15,320 --> 00:16:19,780 KT: ago when I learned about trust from your podcast. Thank you. 301 00:16:20,119 --> 00:16:23,950 KT: The sad thing is that he's now on hospice and 302 00:16:23,950 --> 00:16:29,080 KT: unable to sign documents and isn't coherent 20% of the time. 303 00:16:29,849 --> 00:16:34,010 KT: OK, but here is the good news. I am his 304 00:16:34,010 --> 00:16:38,070 KT: financial power of attorney. Can I set up the trust 305 00:16:38,070 --> 00:16:41,890 KT: on his behalf? He had an appointment with his lawyer 306 00:16:41,890 --> 00:16:45,729 KT: to do so, but went into the hospital and was unable. 307 00:16:46,090 --> 00:16:49,109 KT: Then unexpectedly went on hospice. 308 00:16:50,349 --> 00:16:54,409 KT: Oh boy, he thinks one particular stepdaughter will be giving 309 00:16:54,409 --> 00:16:58,070 KT: me great issue, and I believe he is right. How 310 00:16:58,070 --> 00:17:00,669 KT: can I protect the wishes in his will? 311 00:17:01,429 --> 00:17:05,670 KT: Laura sounds like she's very reasonable, Suze, and, and she 312 00:17:05,670 --> 00:17:08,729 KT: wants to do the right thing and honor her dad's wishes. 313 00:17:09,109 --> 00:17:11,910 Suze: So, first, let me just say this, Laura, is that no, 314 00:17:11,989 --> 00:17:15,810 Suze: you cannot do it. You cannot set up a trust 315 00:17:15,810 --> 00:17:19,209 Suze: on his behalf just because you're the financial power of attorney. 316 00:17:19,400 --> 00:17:23,708 Suze: That isn't granted in that type of a document, number one. 317 00:17:24,359 --> 00:17:28,760 Suze: Number two, the only downside of all this is if 318 00:17:28,760 --> 00:17:32,359 Suze: he has done a will, you are the executor of 319 00:17:32,359 --> 00:17:35,619 Suze: his will, it's just going to have to go through probate. 320 00:17:36,109 --> 00:17:40,619 Suze: That isn't that big of a deal in terms of 321 00:17:40,849 --> 00:17:44,680 Suze: where everything goes and one of the stepdaughters contesting. 322 00:17:45,439 --> 00:17:47,938 Suze: Because I doubt that they will because it's his will 323 00:17:47,939 --> 00:17:50,469 Suze: and his will is valid. 324 00:17:51,099 --> 00:17:53,020 Suze: It's going to cost you money that it wouldn't have 325 00:17:53,020 --> 00:17:55,159 Suze: cost you if you had done a trust. It might 326 00:17:55,349 --> 00:17:57,939 Suze: take six months to one year or two years, depending 327 00:17:57,939 --> 00:17:59,978 Suze: on the state you're doing it, because it's not in 328 00:17:59,979 --> 00:18:04,420 Suze: a trust, but you can do it that way. My 329 00:18:04,420 --> 00:18:08,520 Suze: real question for you is, you say that he's only 330 00:18:08,859 --> 00:18:11,939 Suze: unable to sign things like 20% of the time. 331 00:18:12,819 --> 00:18:17,760 Suze: What about the 80% of the time? Is he coherent? 332 00:18:18,420 --> 00:18:23,339 Suze: Could the lawyer go to the hospital and have him 333 00:18:23,339 --> 00:18:29,819 Suze: do the trust there during his coherent times? Is that possible? 334 00:18:30,420 --> 00:18:34,969 Suze: Because it's not like his stepdaughters know that he's always incapacitated, 335 00:18:35,219 --> 00:18:41,319 Suze: 'cause he's not. He's only incoherent 20% of the time. 336 00:18:41,709 --> 00:18:45,369 Suze: So if I were you, I would call the lawyer 337 00:18:45,949 --> 00:18:49,589 Suze: and say, can you go visit him and see what 338 00:18:49,589 --> 00:18:54,750 Suze: you think? Is he coherent? Does it make sense? You 339 00:18:54,750 --> 00:18:58,089 Suze: can videotape him, by the way, doing it as well 340 00:18:58,270 --> 00:19:01,949 Suze: so that everybody can see that he was coherent when 341 00:19:01,949 --> 00:19:03,010 Suze: he was doing it. 342 00:19:03,869 --> 00:19:08,910 Suze: And just because he's on hospice doesn't mean that he's 343 00:19:08,910 --> 00:19:11,270 Suze: going to die in two weeks, gonna die in three weeks. 344 00:19:11,349 --> 00:19:15,390 Suze: They're administering morphine. Hospice is a lot different than what 345 00:19:15,390 --> 00:19:19,949 Suze: people think. So, it's just something for you to consider. 346 00:19:20,270 --> 00:19:23,810 Suze: Worst case scenario, just follow his will. 347 00:19:24,270 --> 00:19:27,790 Suze: Be strong about it and just love him up during 348 00:19:27,790 --> 00:19:31,699 Suze: the day, during the night, every second you spend with him, 349 00:19:32,069 --> 00:19:36,469 Suze: because these really are the most precious moments of both 350 00:19:36,469 --> 00:19:39,030 Suze: of your lives, whether you know it or not. All right. 351 00:19:39,030 --> 00:19:44,989 KT: All right. Next question is from Jenna. Jenna said thank 352 00:19:44,989 --> 00:19:49,010 KT: you for your continued wisdom and passion for helping women 353 00:19:49,010 --> 00:19:51,709 KT: and all of those smart enough to listen. 354 00:19:52,189 --> 00:19:55,430 KT: I just love listening to you and KT on my 355 00:19:55,430 --> 00:19:59,349 KT: commute to work. I enjoy when people share that with 356 00:19:59,349 --> 00:20:02,310 KT: us because some people listen to us when they walk 357 00:20:02,310 --> 00:20:06,810 KT: their dog in the morning, when they exercise, when they meditate. 358 00:20:07,430 --> 00:20:10,030 KT: I don't know if you can meditate and listen to us, 359 00:20:10,510 --> 00:20:13,989 KT: but she said, here are the details before I ask 360 00:20:13,989 --> 00:20:14,829 KT: my question. 361 00:20:15,369 --> 00:20:19,849 KT: I put the mandatory 3% to my retirement. My employer 362 00:20:19,849 --> 00:20:24,639 KT: puts in 4%. I then put in a voluntary 2%, 363 00:20:24,930 --> 00:20:27,890 KT: and my employer puts in another 4%. 364 00:20:28,390 --> 00:20:33,630 KT: I owe $40,000 in credit card debt, all currently at 365 00:20:33,630 --> 00:20:37,510 KT: zero interest rate. My car is paid off. I owe 366 00:20:37,510 --> 00:20:44,430 KT: $360,000 on my mortgage. I make $155,000 a year, and 367 00:20:44,430 --> 00:20:49,589 KT: my FICO score is 746. I'm a single mama. 368 00:20:50,180 --> 00:20:52,819 KT: She said, Suze, you said don't think about saving for 369 00:20:52,819 --> 00:20:55,540 KT: your future till you have taken care of your mistakes 370 00:20:55,540 --> 00:20:59,540 KT: of the past. Hm, that's a good one. This makes 371 00:20:59,540 --> 00:21:03,260 KT: me think I should not add the voluntary contribution and 372 00:21:03,260 --> 00:21:08,359 KT: take the money to pay off the debt faster. Please advise. 373 00:21:09,214 --> 00:21:13,805 Suze: Here's the thing, girlfriend. You've also heard me say the 374 00:21:13,805 --> 00:21:18,204 Suze: biggest mistake you can make is passing up free money. 375 00:21:19,035 --> 00:21:20,974 Suze: Haven't you heard me say that? I don't care how 376 00:21:20,974 --> 00:21:23,694 Suze: much debt you have. I don't care whatever. You have 377 00:21:23,694 --> 00:21:26,375 Suze: to contribute up to the point of the match because 378 00:21:26,375 --> 00:21:31,895 Suze: it is free money. So it's not a mistake. Obviously 379 00:21:31,895 --> 00:21:35,795 Suze: your debt that you created for yourself, the $40,000. 380 00:21:36,219 --> 00:21:39,389 Suze: I'm not so upset about that because you said one 381 00:21:39,390 --> 00:21:43,219 Suze: thing here, you said you're a single mamma. So I 382 00:21:43,219 --> 00:21:45,400 Suze: don't know what you had to do, 383 00:21:46,270 --> 00:21:49,739 Suze: to get by as a single mama. So I'm not 384 00:21:49,739 --> 00:21:51,780 Suze: going to yell at you or even feel bad about 385 00:21:51,780 --> 00:21:54,938 Suze: the fact that you have $40,000 of debt. You have 386 00:21:54,939 --> 00:21:58,449 Suze: a great FICO score, you're making a great living. You're 387 00:21:58,449 --> 00:22:00,500 Suze: now on the right path. 388 00:22:01,020 --> 00:22:04,709 Suze: And especially at times like this where the markets are 389 00:22:04,709 --> 00:22:07,869 Suze: going up, it's still a great time to invest. I 390 00:22:07,869 --> 00:22:11,949 Suze: don't want that money out of your retirement account. Now, hopefully, 391 00:22:12,500 --> 00:22:15,869 Suze: regardless of your income that you're making, you are in 392 00:22:15,869 --> 00:22:20,949 Suze: a Roth retirement account at work, all right? Just tell 393 00:22:20,949 --> 00:22:23,829 Suze: me that you're doing that, cause otherwise, that would be 394 00:22:23,829 --> 00:22:26,109 Suze: a mistake. All right, now, listen. 395 00:22:26,729 --> 00:22:30,169 Suze: Just keep doing what you're doing. Keep paying it off 396 00:22:30,170 --> 00:22:33,209 Suze: as you can, and sooner than later you will be 397 00:22:33,209 --> 00:22:37,530 Suze: out of debt. Just that simple. All right, go on, KT. 398 00:22:37,660 --> 00:22:41,770 KT: OK, this is my last question, from Matthew. He said, Hi, 399 00:22:41,930 --> 00:22:46,209 KT: Suze and KT. Thanks for the many great episodes on 400 00:22:46,209 --> 00:22:50,948 KT: Roth accounts. I know KT will empathize with my struggle 401 00:22:51,290 --> 00:22:54,359 KT: to grasp the finer points of Roth funds. 402 00:22:54,449 --> 00:22:56,050 Suze: Wait, before you go on, KT. 403 00:22:56,520 --> 00:22:58,839 Suze: How do you feel about it that everybody in the 404 00:22:58,839 --> 00:23:04,160 Suze: world writes in and they identify with your lack of 405 00:23:04,160 --> 00:23:06,319 Suze: ability to understand Roths? 406 00:23:06,319 --> 00:23:09,169 KT: Because it's complicated and I'm a very smart girl. 407 00:23:09,319 --> 00:23:13,739 Suze: Now let me correct something here, right? You keep saying 408 00:23:13,739 --> 00:23:14,819 Suze: it's complicated. 409 00:23:14,900 --> 00:23:15,270 KT: It is. 410 00:23:15,439 --> 00:23:19,000 Suze: Listen to me. Everybody thinks it's complicated. 411 00:23:19,329 --> 00:23:23,889 Suze: And because you're all thinking it's complicated, you're all making 412 00:23:23,890 --> 00:23:28,329 Suze: it more complicated than it really is. So KT, I 413 00:23:28,329 --> 00:23:31,949 Suze: need you to stop thinking that it's complicated. I need 414 00:23:31,949 --> 00:23:35,189 Suze: you to start thinking along with Matthew and everybody else 415 00:23:35,369 --> 00:23:38,250 Suze: that it's actually easy and you can do it. 416 00:23:38,650 --> 00:23:39,060 KT: OK. Good Luck. 417 00:23:41,079 --> 00:23:44,069 KT: That's all, that's all I have to say, everyone. Good luck. 418 00:23:44,349 --> 00:23:47,169 KT: I'll give it a shot, Suze, but good luck. 419 00:23:47,979 --> 00:23:50,420 Suze: Why can't you do that for me, sweetheart? 420 00:23:50,579 --> 00:23:52,630 KT: I'll give it a shot. So I have a few... 421 00:23:52,630 --> 00:23:54,650 Suze: Could you imagine if I called you sweetheart all the time? 422 00:23:54,500 --> 00:24:00,069 KT: You know who calls sweetheart? Don calls our sister Barbara sweetheart. 423 00:24:00,310 --> 00:24:01,699 KT: She calls him sweetheart. 424 00:24:02,619 --> 00:24:06,399 KT: And Tom calls Lynn honey honey. 425 00:24:06,739 --> 00:24:08,800 Suze: And what does your brother call Lisa? 426 00:24:09,770 --> 00:24:12,399 KT: Uh Poopsy. Poopsy. Oh my God. 427 00:24:12,540 --> 00:24:13,910 Suze: I call my KT, KT. 428 00:24:16,300 --> 00:24:19,280 KT: And Colo calls me KT. He every morning. Hi KT. 429 00:24:19,739 --> 00:24:23,500 KT: Hi Suze. All right, so Matthew, we're gonna give this 430 00:24:23,500 --> 00:24:28,420 KT: a shot. So Matthew said, I have a few questions 431 00:24:28,420 --> 00:24:33,369 KT: in my road to understanding. OK. First, withdrawals. I'm only 432 00:24:33,369 --> 00:24:36,459 KT: gonna ask one question, Matthew, just so you know, we're 433 00:24:36,459 --> 00:24:40,099 KT: gonna take this step by step. There's like two pages 434 00:24:40,099 --> 00:24:42,780 KT: here of questions about the Roth, so I'm gonna do one. 435 00:24:43,099 --> 00:24:44,459 KT: That's it. That's all you get. 436 00:24:45,189 --> 00:24:49,949 KT: I understand there are no penalties on withdrawing contributions, but 437 00:24:49,949 --> 00:24:56,969 KT: I cannot touch the earnings. My question is on operationalizing this. 438 00:24:57,630 --> 00:25:01,109 KT: When I go into my brokerage account and see the 439 00:25:01,109 --> 00:25:01,699 KT: cost basis. 440 00:25:02,510 --> 00:25:05,869 KT: I know I can withdraw that amount, but when I 441 00:25:05,869 --> 00:25:10,829 KT: sell any particular stock, I sell earnings too. How do 442 00:25:10,829 --> 00:25:15,979 KT: I report on taxes without having to pay penalties and taxes? 443 00:25:16,630 --> 00:25:18,829 KT: Do not make this a quizzy, Suze. 444 00:25:19,349 --> 00:25:21,988 Suze: Oh, trust me, I won't because it's so easy. This 445 00:25:21,989 --> 00:25:24,500 Suze: is too easy for you to have this as a quizzy. 446 00:25:24,790 --> 00:25:25,569 Suze: Don't you agree? 447 00:25:25,829 --> 00:25:26,129 KT: Yeah. 448 00:25:26,349 --> 00:25:28,770 Suze: This is way too easy. You understand this one, right? 449 00:25:29,130 --> 00:25:29,380 KT: No. 450 00:25:29,869 --> 00:25:30,909 Suze: Matthew... 451 00:25:31,510 --> 00:25:37,869 Suze: Listen to me. Your cost basis doesn't determine anything. It 452 00:25:37,869 --> 00:25:43,119 Suze: doesn't matter when it's in a Roth IRA. Why? Because 453 00:25:43,229 --> 00:25:46,069 Suze: there are no taxes in a Roth when you buy 454 00:25:46,069 --> 00:25:51,060 Suze: or sell something. It's all tax-free. All that matters in 455 00:25:51,060 --> 00:25:55,670 Suze: a Roth is the amount that you originally contributed. 456 00:25:56,449 --> 00:26:01,530 Suze: So, if you originally contributed, let's just say $7,000 all right, 457 00:26:01,589 --> 00:26:05,209 Suze: let's just say that's true, and you bought something, you 458 00:26:05,209 --> 00:26:07,890 Suze: sold something, and you doubled your money. 459 00:26:09,030 --> 00:26:14,349 Suze: As long as you don't withdraw more than $7,000 there's 460 00:26:14,349 --> 00:26:17,829 Suze: no taxable event. It's not like they divide it from 461 00:26:17,829 --> 00:26:24,030 Suze: earnings to whatever. It's when you actually withdraw everything above 462 00:26:24,030 --> 00:26:26,188 Suze: the amount that you originally contributed, 463 00:26:27,125 --> 00:26:31,005 Suze: that will be considered earnings. But you're not going to 464 00:26:31,005 --> 00:26:35,005 Suze: take out more than you originally contributed before five years 465 00:26:35,005 --> 00:26:38,594 Suze: and when you're 59 and a half, so you're overthinking this, boyfriend. 466 00:26:38,675 --> 00:26:41,744 Suze: It's just that simple now, KT, did that make sense 467 00:26:41,744 --> 00:26:42,074 Suze: to you? 468 00:26:42,204 --> 00:26:43,625 KT: Yeah, that was easy. 469 00:26:44,459 --> 00:26:45,650 KT: That was easy. 470 00:26:46,060 --> 00:26:46,659 Suze: Come on. 471 00:26:47,060 --> 00:26:49,180 KT: No, that was easy. That made a lot of sense 472 00:26:49,180 --> 00:26:50,699 KT: to me. What you just said 473 00:26:50,979 --> 00:26:51,660 KT: was easy. 474 00:26:51,819 --> 00:26:56,719 Suze: Now, is it possible, everybody, here's the million dollar question. 475 00:26:56,900 --> 00:27:01,180 Suze: Is it possible KT thought that was easy because we 476 00:27:01,180 --> 00:27:05,379 Suze: shifted her mindset from thinking something was complicated to thinking 477 00:27:05,380 --> 00:27:07,379 Suze: it was easy? Is that possible? 478 00:27:07,630 --> 00:27:10,819 KT: Yeah, it is possible. 479 00:27:11,160 --> 00:27:13,099 KT: That was easy to understand. 480 00:27:13,359 --> 00:27:17,209 Suze: So you agree with me that maybe Roth's can be easy? 481 00:27:17,760 --> 00:27:18,260 KT: Yes. 482 00:27:18,719 --> 00:27:19,430 Suze: Easy, right? 483 00:27:19,920 --> 00:27:22,040 KT: Yes, yes, yes, yes, yes, yes. 484 00:27:22,400 --> 00:27:23,780 Suze: So you know what else is easy? 485 00:27:24,800 --> 00:27:28,489 Suze: The fact that that ends this Ask KT and Suze 486 00:27:28,489 --> 00:27:33,270 Suze: Anything podcast, one thing we want all of you to do, 487 00:27:33,689 --> 00:27:39,209 Suze: and that is to go to youtube.com/ Suze Orman, and 488 00:27:39,209 --> 00:27:43,050 Suze: you will find videos there that you will want to 489 00:27:43,050 --> 00:27:45,869 Suze: see not only of my old shows and things like that. 490 00:27:46,290 --> 00:27:50,489 Suze: But sometimes I appear there talking about stocks and things 491 00:27:50,489 --> 00:27:53,869 Suze: that we don't do on this podcast, so go there 492 00:27:53,869 --> 00:27:58,810 Suze: and check it out. All right, KT take us out. 493 00:27:59,790 --> 00:28:04,410 KT: So everybody just remember 3 things... People first. 494 00:28:04,739 --> 00:28:05,270 Suze: She almost forgot. 495 00:28:06,069 --> 00:28:06,650 Suze: You almost forgot. I can tell you forgot. 496 00:28:06,729 --> 00:28:11,630 KT: People first, then money, then things. 497 00:28:12,170 --> 00:28:16,890 Suze: Now you stay safe, strong, healthy, and secure, and we'll 498 00:28:16,890 --> 00:28:17,639 Suze: see you soon.