Suze: June 29, 2025. Welcome everybody to the Women and Money podcast,
Suze: and everybody smart enough to listen. No, today is not
Suze: Suze School.
KT: It's ask... KT's here, so it's Ask KT and Suze Anything Sunday.
Suze: Because God forbid you should go more than a week
Suze: or two
Suze: Without hearing KT, who you just all adore, I hope
Suze: you all do. But anyway, so we switched Thursday to
Suze: be Suze School a few days ago, and you should
Suze: all listen to that.
KT: It was a good one. I'm glad you switched.
Suze: And now here we are. I just want to inform
Suze: you all right now, obviously...
Suze: Next Thursday is July 3rd, but we're gonna be doing
Suze: the podcast on July 2nd instead, so tune in one
Suze: day early because I have a very special just for
Suze: all of you on this podcast from Alliant Credit Union,
Suze: and you do not want to miss it.
KT: Oh yea, don't miss it.
Suze: You're really gonna want to tune in because I don't
Suze: know how long it will last. That is July 2nd.
Suze: All right, KT, I just have to say because people
Suze: are yelling at me, well, how do we write in
Suze: a question? So because we haven't said it.
Suze: For some reason I just forget to do it sometimes.
Suze: If you wanna ask a question.
Suze: Go to ask Suze S U Z E podcast at gmail.com.
Suze: Send it in and if KT chooses it, we will
Suze: answer it on the podcast, but you have to listen
Suze: every week to see if your question was answered. All right, KT.
KT: So Suze, first question is from Gloria. Hi Suze, I
KT: have a question...
Suze: That's a great name: Gloria.
KT: Yeah, that was a great song, wasn't it.
KT: I have a I have a savings account that gives
KT: me 3.75% monthly...
Suze: I doubt it, but go on.
KT: ...with $88,000 in that account. I have a home equity
KT: line of credit that I owe $43,000 on.
KT: And I'm paying $500 a month in charges. Should I
KT: take some money out of my savings account to pay
KT: that off?
Suze: All right, everybody, I want you to listen to me
Suze: very carefully. Did you notice anything in Gloria's email that
Suze: made absolutely no sense whatsoever?
Suze: Uh huh, no responses. Listen, Gloria, it is impossible that
Suze: you are making 3.75% monthly on your $88,000. That would
Suze: mean that you are being paid 45% a year in interest.
Suze: You're making 3.75% APR. That is what you are making
Suze: over the entire year.
Suze: Therefore, you should absolutely take $43,000 out of that savings
Suze: account and do what with it? Pay off your home
Suze: equity line of credit. All right, next, KT,
KT: OK, from Jeff, this is very sweet.
KT: Hey, Suze and KT, thank you for continuing to give
KT: us guidance when you could clearly just stop and enjoy
KT: your retirement years.
Suze: Yeah, I've been talking to KT about that lately, haven't I?
KT: Your advice has been life changing. I dread the day
KT: you decide to call it quits. She's not going to quit, Jeff,
KT: as long as I'm around, she'll never quit.
Suze: Go on.
KT: My husband retired early at the age of 57 and
KT: has a 401k, both Roth and regular, because our company
KT: didn't offer the Roth in the beginning. Our financial adviser
KT: has suggested we roll it over to him. After seeing
KT: financial institutions fail around 2008. Now that was a long
KT: time ago.
KT: I'm hesitant to put all our eggs in one basket.
KT: I believe our balances are larger, more than a million,
KT: than brokerage account insurance is allowed, but I'm not exactly
KT: sure how this works. The fees are also higher with
KT: the financial adviser, but he's been worth his weight in
KT: gold with other
KT: accounts he manages. Which is great, Jeff. Our financial advisors
KT: with Morgan Stanley. Should we go ahead and roll over
KT: the 401k to him in both the traditional and Roth,
KT: or should we keep them where they are? All right, what's,
KT: what's your advice to Jeff?
Suze: So here's the thing, Jeff, you're 57, and you retired
Suze: at the age of 57, OK.
Suze: There is a rule called 72T that if you leave
Suze: service in the year that you turn 55 or later,
Suze: you can access any money you want in your 401k
Suze: without any penalties whatsoever. Obviously you would have to pay
Suze: taxes on it, but you could access some of that
Suze: money right now. If you roll it over to your
Suze: financial adviser,
Suze: you cannot touch that money until you are 59.5 years
Suze: of age. Now, do you already have a Roth IRA
Suze: with that financial advisor, because if not, your 401k Roth
Suze: is going to have to start the five year period
Suze: all over again, so you're not going to be able
Suze: to access that either without penalty and possibly taxes. Therefore,
Suze: I would think about this. You also don't have to
Suze: be an all or nothing investor.
Suze: You feel comfortable with the money obviously in your 401k.
Suze: It's doing great hopefully in your 401k. The question that
Suze: you have to ask and answer with this financial advisor
Suze: if you roll it over to him.
Suze: Is it true that he will be able to make
Suze: you more in his opinion that will cover the management
Suze: fee than you would make simply leaving it in the 401k?
Suze: You also could leave some of the money in the
Suze: traditional 401k.
Suze: Just so that you can access it if you need
Suze: to without the penalty, just something to think about because
Suze: you lose that if you roll it over. So up
Suze: to you. One last thing, even though I know Miss
Suze: Travis thinks it's too much information, I always think, you
Suze: know what, you need to know everything you need to
Suze: know when it comes to your money. Remember,
Suze: your husband may still be working. One day you may
Suze: decide to go back to work and earn even more money.
Suze: And if you're making more than the modified adjusted gross
Suze: income limits for Roth IRAs, you will not be able
Suze: to contribute to it unless you do a backdoor Roth.
Suze: But you won't be able to do a backdoor Roth
Suze: if you have an IRA. You will be able to
Suze: do it if you have a traditional 401k.
Suze: Just saying, KT don't look at me like that.
KT: I've got a front door Roth. OK. All right, Sherry,
Suze: She so hates I go long.
KT: No, no, no, it's not, it's not too long. Actually
KT: there's some questions in here where I want to have
KT: conversations with you. It's the Roth and everyone knows that
KT: it's confusing. So I think the least amount of information.
KT: to put under your hat with the wrath the best.
Suze: But KT, you've got to know
KT: these things. I know, but you can know them one
KT: at a time, not all in one question.
Suze: He
Suze: needs to know it because he's about to do an
Suze: IRA rollover with his broker, and if he does, he'll
Suze: never be able to do a backdoor roll.
KT: OK, so now you have all the information you need,
KT: Jeff and husband.
Suze: Thanks, wife!
KT: OK. Are you ready?
Suze: Yeah.
KT: Next question is from Sherry. I like this question because
KT: this is information everyone has to have. Good day. I'm
KT: about to get our will, trust, and all must have
KT: documents in order. Where do you recommend I keep the
KT: final forms safe?
KT: What if they get destroyed in a natural disaster such
KT: as a hurricane? Now, you can also add on to
KT: that fire, tornado, flood. I mean, add everything on there, Sherry,
KT: with the weather these days. And then she asks a
KT: good question, Suze, should I make duplicates of signed forms
KT: and then share with certain family members? I assume they
KT: would be valid too.
KT: Are they?
KT: No. They are not valid.
KT: Yeah, they're not.
Suze: Only the original is valid.
KT: It's still a good safeguard.
Suze: But that doesn't mean that her family shouldn't know what
Suze: her intentions were, right.
KT: And then it says thank you, Susie for your invaluable advice.
KT: So tell everyone where to get the must have documents.
Suze: If I were you, I would keep them at home
Suze: in a fireproof and waterproof box.
Suze: I know, I know. I'm so sorry that we're no
Suze: longer manufacturing the gold box, the silver box, the blue
Suze: box that met those needs, but we're just not right now.
Suze: You never know when we'll bring them back. But for now,
Suze: we're not. So...
KT: Some people keep them in their safe deposit box in
KT: a bank.
Suze: If you do keep it in a safety deposit box,
Suze: then you have to make sure
Suze: the relative... you die, how are they going to get
Suze: to it? So you have to make sure that your
Suze: relative and another relative know they happen to be on
Suze: the name of the safety deposit box. And what happens, KT?
Suze: I know you're going to think I'm nuts, but what
Suze: happens if there's a tornado and all of a sudden
Suze: the bank office that has all of that has been
Suze: blown away. They're not open. You can't get to it.
Suze: Right, and you happen to be killed in that disaster.
Suze: I mean, things can happen. I would have them in
Suze: either a waterproof, fireproof box that I kept, or keep
Suze: it at another person's home. That is the person that
Suze: would need it in case something happened to you, so
Suze: it's not at your home.
Suze: And hopefully they live somewhere that's safe, but that if
Suze: they ever had to evacuate, they just take it with them.
Suze: So there are boxes that aren't so heavy that you
Suze: can just grab and go with them and just know
Suze: that the only thing that's valid is the original. So,
Suze: like with the must have docs that let's say you
Suze: lost them.
Suze: All right, they went away somehow. You can go right
Suze: online again and print them out and then go get
Suze: them notarized once again. And then there valid all over again.
Suze: So that's what I would be doing if I were you.
KT: Now tell them where to get them.
Suze: Oh, if you want to get the must-have docs, go
Suze: to musthavedocs.com.
Suze: And that's where you get them currently. They are $99
Suze: for $2500 worth of state of the art documents, good
Suze: in all 50 states, and I just think they're fabulous.
KT: Everyone has to have the must have documents.
Suze: Alright, go on.
KT: Ok, Janet...
Suze: You know, it's funny, KT, the commercial that you see
Suze: on television all the time where this guy pops up
Suze: and goes, no, it doesn't work that way. They're charging
Suze: $199
KT: just for the...
Suze: the will. Are you kidding me? I mean, this is $99
Suze: for the will, the living revocable trust,
Suze: the advanced directive and durable power of attorney for health
Suze: care and the financial power and any time you want
Suze: to change them, you can do it again and again.
Suze: You want to share your activation code with members of
Suze: your family. You can do it. If the company that
Suze: manufactures it ever has an upgrade, you get the upgrade
Suze: for free. For those of you who have lost your
Suze: activation code, we give you a new one. Are you
Suze: kidding me? Anyway, go on.
KT: Ok, the next question is from Janelle and Patrick.
KT: Hi Suze and KT. My husband and I are 65
KT: years old. Can you educate us about the ins and
KT: outs of converting traditional IRA dollars to a qualified longevity
KT: annuity contract known as a QLAC as a tax strategy
KT: to defer RMDs when we turn 73? We won't need
KT: the RMD dollars for living expenses.
KT: And have concerns about income exceeding IRMAA brackets. So Suze,
KT: how does that all work?
Suze: So basically, what concerns me is you say currently you
Suze: don't need your RMDs, which are required minimum distributions.
Suze: And I don't know exactly how much you have within
Suze: your IRAs and things like that, but if you did
Suze: a qualified longevity annuity contract and everybody, it's just a
Suze: special kind of like deferred income annuity, and it can
Suze: be purchased, however, with funds from a traditional IRA or
Suze: a qualified retirement plan.
Suze: So why would people do that? Because you can defer
Suze: required minimum distributions beyond the age of 73, but only
Suze: up to the age of 85, which could possibly help
Suze: you manage taxable income and Medicare and things like that.
Suze: What concerns me is, all right, you said that you
Suze: don't need your RMDs.
Suze: But what if you needed the actual principle that's generating
Suze: the RMDs, because once you do this, right, that's it,
Suze: you can't really do anything else with it. The money
Suze: is removed to the annuity, and what this does is
Suze: you can't touch it.
Suze: But it guarantees you income later in life. So if
Suze: you live to 85 and beyond, the qualified annuity ensures
Suze: that you won't outlive your money now.
Suze: I don't think it's worth it to tell you the truth.
Suze: I just don't. The maximum you can do is 200,000
Suze: per person from your traditional, but I don't know, it's
Suze: not indexed for inflation.
Suze: It's, I just don't think it's they shouldn't do it.
Suze: I wouldn't do it if I. OK, there you go.
Suze: I would want to know I could have access to
Suze: my money, and if I really didn't need it, then
Suze: maybe you should start converting it to a Roth so that,
Suze: you know, eventually when you do take it out because
Suze: you're only 65, right?
Suze: That won't qualify for RMDs anyway. I just don't like them. Also,
Suze: do me a favor, ask your financial advisor the commission
Suze: they'll make if you buy one. All right, go on.
KT: Oh
KT: OK.
Suze: OOOH, what does that remind me of?
KT: She loves the commercial. What is it for?
Suze: I
Suze: don't even know. I just wait and watch him go,
KT: Oh, the
KT: little boy, um, in the commercial looks at his daddy who,
KT: who hits a baseball, breaks a windshield. It's for, for
KT: the windshield replacement company. Little boy looks at his daddy
KT: and goes, Oh, like you did it, and
KT: Suze loves that commercial.
Suze: But then I stopped watching after he does that. All right.
KT: All right, so from Laurie, Hi Suze. I've been listening
KT: to you for many years and try to take your
KT: advice as often as possible. I am a teacher that
KT: is starting to look at what my retirement could look
KT: like possibly 3 years from now. First of all, we
KT: want to both say we love teachers.
KT: And we love your profession. You're very, very important.
Suze: There's this commercial where you see this teacher taking some
Suze: pill that's making her feel great, whatever, but she's dancing
Suze: through the classroom and she's doing these great things and
Suze: she just looks so happy and I was thinking, oh,
Suze: maybe I need to be a teacher. And then I thought...
KT: You are a teacher.
Suze: But couldn't you see me in a room with little kids?
KT: Oh, being a teacher for children.
Suze: No, no...
KT: No,
KT: I cannot
KT: stay with the big
KT: kids stay with the old kids.
KT: So, and then she said, Suze, you've always advised opening
KT: a trust. I was informed that a trust should not
KT: contain your pension and TDA.
KT: Correct, yeah, it, it, it wouldn't contain the pension. As
KT: a divorced mother of two, I want to protect and
KT: plan for myself and make sure my hard work will
KT: go to my children without any issues. Can you elaborate
KT: on trust and why this is not an option for
KT: me and what I should be doing, so I think
KT: the trust is an option that...
Suze: You have to do the trust for other things like
Suze: your house, your bank account, your investments, all of those
Suze: things to make it easier for your children. However, an
Suze: individual retirement account,
Suze: IRA I'm just gonna start there to make it easy
Suze: for you. It's an individual that owns that retirement account.
Suze: So given an individual cannot be a trust.
Suze: It cannot be in a trust. The same is true
Suze: with your pension as well as your tax deferred annuity.
Suze: Now your tax deferred annuity because you are a teacher
Suze: is exactly like a 401k or a 403B, and it
Suze: has to be in the employee's name, not in the
Suze: trust name.
Suze: So it is the school district that has hired you,
Suze: not the trust, but you can, if you want, just
Suze: name your children as long as they're like over 18
Suze: or 19 or they're responsible with money as the beneficiaries
Suze: of that TDA, and then it will go to them directly,
Suze: just that simple. Also with your pension.
Suze: Usually your pension upon your death also goes away unless
Suze: you do a joint and survivor pension with your spouse.
Suze: I don't know if they allow you to do it
Suze: with children, but you should have a trust. But no,
Suze: individual retirement accounts, pensions, annuities, and things like that when
Suze: you're an employee cannot be owned in a trust.
KT: OK,
KT: so my final question is from Laura.
KT: And it's a really great one. I have a question
KT: about a sticky situation. And Suze, after I read this,
KT: I said, Oh, this is a sticky question, and I'm
KT: really excited to hear how you're going to respond. A
KT: divorce in our family left our sister-in-law at 72 still
KT: working full time in a Montessori school, living in a
KT: one bedroom apartment and struggling to make ends meet.
KT: She unwisely emptied her retirement account to support her son
KT: in trying and failing to become a trader. He tried
KT: to be a day trader at the time. We covered
KT: the unexpected tax consequences for her. Now ready, this is
KT: the sticky part. Our brother is remarried and has homes
KT: in Rio de Janeiro, Chicago, and recently is considering buying
KT: a third property.
KT: Joining together with a third sibling, our family's providing our
KT: sister-in-law with $1000 a month in order to ease her situation,
KT: so they're subsidizing a sister-in-law, the rest of the siblings.
KT: Our decision in this case is becoming more difficult for
KT: me because I can feel as though by helping our sister-in-law,
KT: which feels like the right thing to do, we are
KT: enabling our brother to live an expensive lifestyle and shirk
KT: his own responsibilities. He does live up to the letter
KT: of their settlement agreement, but no more, thus leaving his
KT: ex-wife vulnerable.
KT: To be honest, I find this situation to be undermining,
KT: if not damaging, my relationship with my brother and his
KT: second wife.
KT: In addition, Suze, my husband is comfortable continuing with this,
KT: and I do not feel that my concerns are being
KT: heard or addressed by him. We have always been on
KT: the same page when it comes to money matters. Suze,
KT: I'd love to hear your take on this, and I
KT: would appreciate any advice you can give us.
Suze: Laura. We have two separate issues here, and you need
Suze: to separate them.
Suze: Number one, let's first deal with the easy one, which
Suze: is your husband.
Suze: Sometimes it's easier just to give money than to deal
Suze: with a situation that's going on, and your husband may
Suze: be somebody number one who doesn't like conflict, but number two,
Suze: he doesn't have the connection.
Suze: The natural connection like you do with your brother. It's
Suze: his brother-in-law, and he may not have been close with him.
Suze: Maybe he was, who knows. But again,
Suze: you need to be a little bit compassionate in that
Suze: maybe he doesn't like I said, like conflict, and it's
Suze: just easier to come up with a few hundred dollars every
Suze: month to support the sister-in-law than have to deal what
Suze: could happen with your brother, not his brother. So you
Suze: need to understand that he doesn't have that blood relationship
Suze: like you do. That's number one. Number two, it's your sister-in-law.
Suze: And I can tell you with my sister-in-laws I don't
Suze: feel like they're my sister-in-laws. I feel like they are
Suze: my sisters and I have long conversations with them and
Suze: love with them as if they are my sisters, but
Suze: I don't quite feel that way with the brother-in-laws, right?
Suze: I love them, but I don't have these long conversations
Suze: except with one, right? So it's, I feel different towards them.
Suze: So I think it would make sense that you feel
Suze: closer to your sister-in-law.
Suze: Than your husband probably felt towards her, and you just
Suze: need to understand that as well. This really boils down
Suze: to issue number two, which is you and your brother.
Suze: We don't know why they got divorced, number one, so
Suze: KT and I can't comment on that. Your brother, however,
Suze: is living up to his agreement that they made, so
Suze: at least he's doing that. So you should not be
Suze: punishing him at all for his success. He wants to
Suze: buy 5 homes, 15 homes. All right, that's his prerogative.
Suze: But what you need to do is sit down and
Suze: talk with him, not to him, but with him. You
Suze: must not make him feel bad that he's been successful
Suze: and he's buying homes. There's nothing wrong with that. He
Suze: obviously doesn't have an emotional attachment to his ex-wife, so
Suze: you should talk to your brother about how it's affected
Suze: you to see her suffer so much.
Suze: And the real question becomes here how old is the
Suze: son now? What is the son doing now? Is the
Suze: son making money now? Because again, your sister-in-law emptied her
Suze: retirement account in order to support her son, no matter
Suze: what she did with it, she did it to support
Suze: her son.
Suze: And now if her son, cause she's 72, so her
Suze: son very well should be in his 30s right now,
Suze: maybe even 40s at this point in time, is he
Suze: working and why isn't he helping her? So you have
Suze: two issues here. The son isn't helping her.
Suze: Obviously because you don't say so in your email and
Suze: her ex-husband isn't helping her and you need to deal
Suze: with those two things. So if I were you, forget
Suze: your husband in terms of him not wanting to do it.
Suze: That's fine. Understand that and don't take it personally. It's
Suze: not damaging your relationship in reality. It's just in your head.
Suze: I would sit down and have a one on one
Suze: talk with my brother from your heart.
Suze: And what could he do possibly to make it easier
Suze: on his ex-wife and therefore make it easier on you
Suze: as well? And again, I would be sitting down with
Suze: the son and saying, What are you doing? How much
Suze: money are you making? Do you understand that we're supporting
Suze: your mother? And if anything happens to us, what is
Suze: your mother going to do? So therefore you need to
Suze: get involved with your mother now.
Suze: That's what I would tell Laura KT.
KT: I agree. I agree 100%. I love that.
Suze: I didn't go on too long?
KT: No, but, but I really love what you said about
KT: her and her husband. She's getting frustrated with the husband,
KT: but it has nothing to do with them. They have
KT: a great relationship, so it's really, it's a sticky question though.
KT: Isn't it? I mean, it's very interesting.
Suze: It's sticky, but it's not, because again, when you get divorced,
Suze: who knows why you got divorced, number one.
Suze: And you maybe get divorced from somebody and you really
Suze: do not like that person anymore and you want to
Suze: have nothing to do with them. KT, truthfully, my last
Suze: relationship before you, I want nothing to do with this person.
Suze: I could care less what... I mean, I could go
Suze: on and on.
KT: We're not going to do that.
Suze: All right, but do I care if she's doing well
Suze: financially or not and da da da, not on any level.
Suze: However, there are exes, right, KT that I have that
Suze: I'm still close with and they were good people and
Suze: honorable and I help them financially...
KT: Standing up when they're in need.
Suze: Yeah, and I love doing that, so it all comes
Suze: down to
Suze: under what circumstances do they get divorced and why do
Suze: they get divorced, Alright.
KT: So that was a good Sunday
KT: conversation. I like that
KT: question.
Suze: All right, so let's do, maybe we need to do Sunday conversations...
Suze: No, we're gonna keep it how it is.
KT: Oh! Sunday chats with KT.
Suze: Oh, you like that do you?
KT: Why don't you put me on both Thursday and Sunday?
KT: And then if you have to do a Suze School,
KT: I'll just listen.
Suze: Because you distract me when you're here.
KT: If you all want to have Sunday chats...
Suze: Do not even go there, KT. All right, listen to me, everybody.
KT: Sunday brunch with KT.
Suze: By the way, what is for brunch today?
KT: I wanted, I've been
KT: craving pancakes and I'm not a sweet. I don't like
KT: sweet things in the morning, but I've been craving pancakes.
KT: I have no idea why.
Suze: Tell them my favorite...
KT: Oh, Suze, Suze's a creature of habit and she loves
KT: the Mariposa gluten-free, um, cinnamon raisin toast, and she actually
KT: has this sent to her from San Francisco, which was
KT: the bakery that we would go to all the time,
KT: every weekend.
KT: And she has it sent to her in like, you know,
KT: 6 loaves at a time so that she freezes it
KT: and loves her two slices of Mariposa gluten-free raisin cinnamon
KT: toast with a cup of coffee every
KT: morning.
Suze: That's my breakfast.
KT: And a matter of fact, sometimes as a treat instead
KT: of dinner, she looks at me with these puppy eyes
KT: and says, KT, don't say no.
KT: KT...
Suze: This
Suze: happened last night, which is why she's talking about it.
KT: Don't say no. Please don't say no. I said, yeah,
KT: I'm not going to agree to that until you ask first.
KT: Can I have a cup of coffee and my raisin
KT: toast for dinner? And I always say, yes, of course you can.
Suze: I was so happy, but anyway, everybody, do not forget
Suze: that July 2nd.
Suze: is when we will be doing the next Ask KT
Suze: and anything, right?
Suze: Wednesday rather than Thursday and we have a very, very well,
Suze: a special announcement that I really think is a great
Suze: deal at this
Suze: time and you should really, really take advantage of it.
Suze: So until then there's only one thing that we want
Suze: everybody to remember and what is it, KT?
KT: People first,
Suze: then money,
KT: Then things.
Suze: Now you stay safe.
KT: Happy Sunday.
Suze: Bye bye.