Suze: September 25th, 2025.
KT: Wait, tell everyone why you're laughing.
Suze: Well, why don't you tell everybody why we're laughing?
KT: So Suze had a keratin treatment yesterday.
Suze: We're in Florida.
KT: We're in Florida. She had a keratin
KT: treatment...
Suze: and my hair can be a little bit unmanageable.
KT: And when I picked her up from the salon, she,
KT: she had a little cap on, a little baseball cap,
KT: and when we got home,
KT: she took it off and I said, Oh my God,
KT: where's your hair? So this treatment makes your hair like
KT: real flat.
Suze: Yes.
KT: And I, I said, Why'd you let him cut it?
KT: She said, I never cut not one strand. I said,
KT: Oh my God, what did you do, Suze? And I
KT: keep looking at her and she's, her hair's real flat.
KT: We should post a photo.
Suze: Maybe, maybe we'll see what happens anyway...
KT: Today's a lucky day. Suze has flat hair and it's
KT: our nephew, our great nephew, Nicky's first birthday. So how
KT: does he think it feels, Nicky, to be one?
Suze: You know what I think is so funny, everybody. First
Suze: of all, welcome to the Women and Money podcast...
KT: And everyone's smart enough to listen.
Suze: All right, so we've got that down. KT has already
Suze: just been going, going, going this morning, um, but what
Suze: I think is so funny is that everybody's making all
Suze: these presents, remember, in our family we don't really buy things,
Suze: so I've watched KT paint a coconut, paint all these
Suze: little things, you know, figures on it and everything, and
Suze: I'm like,
Suze: all these people are going there to be with him
Suze: on what's so fascinating. He's not really even gonna know
Suze: it's his birthday.
KT: Yes, he does.
Suze: Yes, he does anyway, KT.
Suze: You have questions for me today because ask KT and
Suze: Suze anything, but most people tuning in, maybe for the
Suze: first time would think, oh, this is the KT show.
KT: It should be. I bet the ratings will skyrocket if
KT: there's ratings on a podcast.
Suze: There's a number of downloads, right? I think what, what
Suze: are we approaching 50 million. So we're approaching a nice
Suze: number anyway.
KT: All right. Hi, Suze and KT what does fund your
KT: trust mean?
KT: What do I need to do? Is this something I
KT: need to do before getting my must-have documents notarized? Please
KT: advise from Linda.
Suze: Here's the thing, Linda, that you need to understand.
Suze: A trust is like a suitcase where you have to
Suze: pack things in it. You have to put things in
Suze: it so it goes from one place to another very easily.
Suze: If you have a suitcase and there's nothing in it,
Suze: then you get to the place that you're going and
Suze: you open it up and there's nothing there.
KT: I love
KT: that analogy.
Suze: Oh,
KT: I'm, no, I love that.
Suze: I'm so glad. So when you have a trust, I
Suze: want you to think about it as a suitcase that
Suze: you have to put things into that suitcase so it
Suze: can easily go from you
Suze: to your beneficiaries that all kinds of things can happen
Suze: to it when it's in the suitcase. So funding your
Suze: trust means you have to first do the trust, get
Suze: it notarized, get it witnessed. Then what you have to
Suze: do is you have to change the name of, let's
Suze: say your individual bank account from, let's just say, Suze Orman.
Suze: To Suze Orman Trustee for the Suze Orman Trust. You
Suze: have to change the assets that you have your bank accounts,
Suze: your brokerage firm accounts, your real estate. All of those
Suze: things get changed from your individual name,
Suze: into the suitcase and the suitcase has the name of
Suze: Linda trustee for the Linda revocable trust and whatever date
Suze: you did it just that simple. So that's how you
Suze: fund a trust.
Suze: Now, when you get the must-have docs, and I have a
Suze: feeling that you're talking about them and the must-have docs
Suze: are a living revocable trust, an advanced directive and durable
Suze: power of attorney for health care, a financial power of attorney,
Suze: and a will.
Suze: And when you get those and you do them all
Suze: of them, you will absolutely have instructions when you're doing
Suze: the revocable trust of how you fund it. They'll take
Suze: you through the entire process and for those of you
Suze: who don't know what
Suze: the must-have documents are go to musthadocs.com for $99. You
Suze: will get $2,500 worth of state of the art documents,
Suze: good in all 50 states. All right, KT.
KT: All right, Suze, next question. This is from Liza.
Suze: Are you sure?
KT: Yes.
Suze: Do you remember when we saw Liza Minnelli?
KT: I loved it. I love Liza Minnelli, everybody.
Suze: We got to go backstage.
KT: Yeah, we saw her on on Broadway for her show.
Suze: It was so good. Was it on Broadway or was it somewhere else?
KT: It was on Broadway because we were in New York. We had
KT: to walk all the way down the steps.
KT: To get to her dressing room, the old New Yorker...
Suze: Never mind. Next question, KT. We're already done with this podcast.
KT: Liza, Liza with a Z. Hi Suze. I'm 30 years
KT: old and I lost my job earlier this year with
KT: the Doge funding cuts. I want to roll my former
KT: employer Roth 401k into my Roth IRA. I have
KT: $34,000 in my Roth 401k. Question is, when I roll
KT: the funds over, do I dollar cost average this money
KT: into my Roth IRA as I normally would do with
KT: my investments? If I dollar cost average, am I missing
KT: out on money that would have been growing before rolling
KT: it over and now sitting in cash?
KT: So Liza, invest in ETFs.
Suze: Yeah, so Liza with a Z.
Suze: When you transfer that 34,000 into your Roth, if that
Suze: money had been fully invested, listen to me closely already,
Suze: let's say it was in your Roth 401k in a
Suze: Standard and Poor's 500 index fund if it was already
Suze: totally invested.
Suze: When you actually transfer it, maybe you'll transfer it in cash.
Suze: Who knows? I would not dollar cost average. I would
Suze: actually just totally invest if the money that you are
Suze: transferring was 100% invested at that time. If it wasn't
Suze: and it was sitting in cash, then I would dollar
Suze: cost average. All right, KT.
KT: Hi, Suze and KT, if I am maxing out my 401k...
Suze: Who is this from?
KT: AC.
Suze: AC. Ok AC, Ask KT AC.
KT: Should I add additional dollars?
Suze: I'm SO.
KT: Should I add additional dollars to a traditional rollover IRA
KT: or brokerage account? I have both additional accounts, but I'm
KT: not sure which is a better investment for retirement, which
KT: I would like to do in about 10 years. My
KT: income doesn't allow me to contribute to a Roth IRA
KT: just in case you were wondering.
Suze: Yes and I was.
Suze: AC because as you were, as KT was reading that
Suze: to me, I was going, why doesn't you just do
Suze: a backdoor Roth, and you can't do a backdoor Roth,
Suze: everybody remember this if you have a traditional IRA, uh,
Suze: a SEP plan, a simple plan that is pre-tax, you'll be,
Suze: you just don't want to do it if you have one.
Suze: Now my answer's gonna probably surprise you, AC.
Suze: If you are asking me which is better, a traditional
Suze: IRA or a brokerage account, I would tell you I
Suze: would do a brokerage account. And the reason that I
Suze: would do a brokerage account is because once you make
Suze: an investment normally, you may keep it for 10 years
Suze: or longer, and while it's in there, you don't pay
Suze: taxes on it anyway, but when you do go to
Suze: take it out,
Suze: what can happen then you will only pay capital gains
Suze: tax if you have a gain. What happens if you
Suze: have a loss? Then you can take the loss off
Suze: your taxes. You also may have some things in there
Suze: that have a gain. Some have a loss, so you
Suze: can offset them all so you don't pay any taxes. Oh,
Suze: you die. And now the money goes down to your beneficiaries.
Suze: They get a step up in basis. So let's just
Suze: say you took that money and you turned $50,000 into $300,000.
Suze: You die, guess what? Your beneficiaries get a step up
Suze: in basis. They get all of that for $300,000.
Suze: They could sell it all, no taxes. You put it
Suze: in a traditional IRA and it grows and it grows
Suze: and it grows. Oh great. Now you go to take
Suze: it out - ordinary income. Oh, you've lost money on it,
Suze: can't take it off your taxes. You die and it
Suze: goes to your beneficiaries. Totally taxable.
Suze: An investment account over an IRA any day if you
Suze: ask me when it's pre-tax. All right.
KT: OK, next question from Karen.
KT: Hi Suze and KT, I'm reading your retirement book and loving it.
Suze: The Ultimate Retirement Guide.
KT: For 50+. I remember you've mentioned on your podcast, and
KT: I just read it in your book as well, that
KT: a Roth SEP IRA is now allowed.
Suze: Yea, if you can find one.
KT: Do you know...
KT: There you go. The question is, do you know of
KT: any institutions currently offering one? Do you?
Suze: No.
KT: All right, well.
Suze: Listen, everybody, I don't understand, now that the laws have
Suze: changed and you can have a SEP IRA as a Roth,
Suze: no financial institution really is offering it. Maybe I found one,
Suze: but I wouldn't put my money there.
Suze: But so here's what I would do if I were you.
Suze: It's just such a shame. Fund your SEP IRA and
Suze: convert it just that simple and pay taxes on it
Suze: when you convert it. It's the same as if you
Suze: put money into a Roth SEP IRA with after tax money.
Suze: It would come out the same. All right, go on.
KT: All right. Next question is from Miguel. Hi, Suze. I
KT: recently switched jobs and I had a 401k with my
KT: previous employer.
KT: It is a traditional 401k and I was thinking of
KT: rolling it over to my personal Roth IRA or should
KT: I open a traditional IRA?
KT: And then Miguel goes on to say, it's about $650
KT: not much. Hey, every dollar counts, Miguel, but I'd love
KT: to move it in the best way possible, avoiding a
KT: tax hit. Where should I move this money? Thank you.
Suze: You know, KT, this is such a sweet question and
Suze: one that is...
KT: They're all sweet.
KT: Yes, this one is very...
Suze: Very sweet because people would go, really, $650?
Suze: So, and what you said is every penny counts. Miguel,
Suze: listen to me.
Suze: You are to convert it to a Roth IRA absolutely.
Suze: Because now what will happen is as you invested and
Suze: if I were you I would put all $650 into
Suze: an ETF by the symbol VOO,
Suze: and let it grow because now the money will grow
Suze: tax free. So take your tax hit now, put it
Suze: into a Roth IRA and see what happens. It's not
Suze: going to be that big of a tax hit, but
Suze: I'd rather you take a tax hit on $650 than
Suze: years and years and years from now, maybe taking a tax
Suze: hit on 5000, 10,000, 15,000 or more when you go
Suze: to take it out. All right, KT.
KT: Suze, the next question is from Jenny. My husband and
KT: I have a business, so we have the SEP IRA accounts.
KT: We maximize the amount every year. My question is, we
KT: currently have it with Merrill Lynch. My hubby's 61, I
KT: am
KT: 56 they charge us 1% on what we have in
KT: the account. Should I move it to a no brokerage
KT: firm like Fidelity so we stop paying the 1% when
KT: we stop contributing? It adds up every month.
Suze: So first of all, my dear Jenny, here's how I
Suze: would look at this if I were you and everybody
Suze: else wondering this question.
Suze: Because as I peruse the emails that you send in
Suze: to ask Suze - Suze- podcast at gmail.com, all of
Suze: you seem to be asking this question lately. If you
Suze: have money with a financial advisor and let's say 100%
Suze: of it is invested for growth.
Suze: Is it worth it for you to pay 1% or
Suze: more in fees because that will mount up, to this
Suze: financial adviser. Here's how I would make the decision if
Suze: I were you. A financial adviser should at least in
Suze: my opinion, beat the Standard and and Poor's 500 index.
Suze: Now you all know that I really like the exchange
Suze: traded fund by the symbol VOO. Take a look
Suze: at the return for VOO.
Suze: And if your adviser has beat that, all right, stay
Suze: with the adviser. If the adviser has not beat it,
Suze: then what are you paying for?
Suze: Just that simple. All right, KT, next.
KT: This is from Steph Suze, and the reason I love this,
KT: it says pick me KT. It's a quick and Rothy.
Suze: Oh, you know, we should create a...
KT: A drink. Let's make a, let's make a smoothie called,
KT: A Frothy Rothy. I'll put it on the, I'll put
KT: it on the wall, everybody.
Suze: And what would be in it?
KT: I'm not gonna tell you now they have to go
KT: to the wall to get the recipe.
Suze: Guess what I would have in it?
KT: Banana.
Suze: No, I would have root beer and vanilla ice cream.
KT: And a banana maybe? OK that's called a root beer float.
KT: I need one that's called a Frothy Rothy Root Beer maybe.
KT: I keep... (laughing)
KT: Hi KT and Suze. I can't begin to thank you
KT: for all the Roth knowledge you passed, passed on to me.
KT: I currently (laughing)
KT: I just drank a frothy.
KT: I just drank my Frothy Rothy this morning and currently
KT: have a standard investment account and a Roth IRA. They
KT: are both all invested in great companies you've suggested, Suze, yippee.
KT: That yippee is for real, by the way.
KT: My question is this now that I know so much
KT: about Roth IRA accounts and how to invest well within them,
KT: is it possible to transfer shares of these fabulous stocks
KT: from my standard investment account into my Roth IRA,
KT: As my annual $8,000 contribution next year? So Suze, Steph
KT: is over $50. I really don't want to sell those
KT: that I have in the standard, and I sure wish
KT: they were in my Roth.
Suze: So when she says standard, she means in her regular
Suze: investment account. Should I give you that as a pop quizzy?
KT: Oh, no.
Suze: Why?
KT: No, no, don't, because I'm on a roll here.
Suze: Oh really? Do all of us think she's on a
Suze: roll here?
KT: I am.
Suze: Trust me...
KT: Come on, answer the question before everyone forgets the question.
Suze: All right.
Suze: So, Steph, the easy answer to that is no, you cannot, right?
Suze: You cannot transfer stocks that are in an investment account
Suze: into a Roth IRA and have that be considered your.
Suze: Contribution only cash can be considered a contribution when investing
Suze: in a contributory Roth. Could you sell those stocks, pay
Suze: taxes on them now, and then take that money and
Suze: put it in as a contribution? Yes, but I'm not
Suze: sure cause I have a feeling you probably have some
Suze: serious gains in those stocks.
Suze: Especially if they are... anyway, go on, go on,
KT: Just enjoy another Frothy Rothy. All right.
KT: This is from Cindy.
Suze: Oh wait, let me put my flat. Let me fluff...
KT: Cindy said, Suze, I got the must-have documents. I live
KT: in Texas. When I... listen to this question, everybody, whoa,
KT: make this one my pop quizzy. When I met with
KT: an attorney to change the name of my home deed
KT: to the trust name, they
KT: said my trust document was not valid since it was
KT: from California.
Suze: Let me finish this question, and they wanted to do
Suze: a new trust for them. Go on,
KT: It says of course they offered to create a new
KT: will and trust. Is this so? Cindy, you absolutely need
KT: to listen to Suze and everyone out there smart enough.
Suze: In the same way that you have the ability, Cindy,
Suze: when you're like creating a corporation for a company.
Suze: You can create and incorporate in really any place you
Suze: want in Delaware or anywhere. The same is true with
Suze: a living trust. If you create a living trust governed
Suze: by the laws of California, it's good anywhere that you
Suze: happen to be.
Suze: And the reason that the must-have documents chose the state
Suze: of California is that they have the most liberal trust
Suze: laws anywhere, so your lawyer is 100% wrong. I just
Suze: want to make this statement, everybody.
Suze: Over the years, millions and millions and millions and millions
Suze: of people have purchased the must-have docs from all over
Suze: the United States. Don't you think by this point in time,
Suze: that would have been noticed if it wasn't possible. Many
Suze: of those people are no longer alive. They passed everything
Suze: down to their beneficiaries absolutely with ease. There's never been
Suze: a lawsuit or anything like that against them, so I
Suze: doubt highly,
Suze: that the manufactures of the must-have documents would have allowed
Suze: that if it wasn't legal. So therefore they are wrong,
Suze: and by the way, I just have to say.
Suze: We had the must-have documents, and we live in Florida.
Suze: Just saying, go on, KT.
KT: All right, next question is from Carlene. I turned 60
KT: in January 2025. Do I qualify for the additional catchup
KT: amount of $11,250 on my 401k for the 2025 tax year?
Suze: Pop quizzy.
KT: Yes.
Suze: What if she had turned 64?
Suze: Would she have qualified?
KT: I think yes.
Suze: No, it's only between the ages of 60 and 63.
Suze: Don't ask me...
KT: I didn't know that.
Suze: Of course you didn't.
KT: Why?
Suze: Don't ask me why.
KT: ask,
Suze: Don't ask me why. That's the law. I don't know
Suze: why they did that, but yes, you absolutely
Suze: qualify for that catch up contribution. With that, let's say
Suze: you were 59 let's say you were 64, it's only
Suze: like $7,500. All right, go on, KT.
KT: OK, my final question is from Kara, and I, I
KT: picked this one because it said in the subject, is
KT: now a good time to refinance my mortgage?
KT: Hi, Suze and KT. I bought a house two years ago.
KT: I have a 30-year mortgage with an interest rate of 6.125%.
KT: I've been watching mortgage interest rates waiting for them to
KT: go down so I can refinance to a lower rate.
KT: Two local credit unions have 20 year mortgage refinance rates
KT: of 5.5 and 5.375. Should I lock in one of
KT: these lower rates now or wait to see if the
KT: interest rates go down further?
Suze: Interest rates probably will go down further, but again, then
Suze: you never know.
KT: You never know how, when, right?
Suze: You never know. They should go down sooner than later.
Suze: We'll see, but truthfully, the current rate on a 20
Suze: year mortgage,
Suze: if you were to get it it's still at about 6.10%,
Suze: so those are really great rates. So I don't know.
Suze: I think if you did it would probably be OK,
Suze: but you might just want to wait a little. Is
Suze: it a special offer that these credit unions are offering
Suze: right now?
Suze: Or is it gonna go away? So can you just
Suze: ask your credit unions, is this a special or what
Suze: do they think? Because it might be a special to
Suze: get you to do it now and it's gonna stay
Suze: that way even if they lower rates. So there you go.
KT: OK, Suze, that's a wrap.
Suze: I don't think so.
KT: Oh no.
Suze: Yeah, you're right.
KT: Oh no, she's doing it. She's bringing back the quizzes.
Suze: So this is where I asked KT a question.
Suze: And all of you are being asked the same question,
Suze: and I want you to be able to answer this question.
Suze: This is from Doctor SD. All right. Hi ladies, I
Suze: love listening to the way the two of you interact.
Suze: Oh yeah, like today? Anyway, it is so much fun
Suze: in addition to being a learning experience. I just listened
Suze: to both Roth podcasts together. Did I do this right?
Suze: I am over 65. OK, I opened a Roth in 1994.
Suze: It had about $60,000 in it.
Suze: So I opened a Roth on January 10, 2025 and
Suze: transferred everything from my Schwab account that I had opened
Suze: in 1994 to a new account at Fidelity feeling it
Suze: was time to consolidate. So KT, just to be clear,
Suze: this person is 65. They opened a Roth in 1994
Suze: at Schwab. The beginning of this year, they opened up
Suze: another Roth at Fidelity, and now they want to transfer
Suze: the money from the Schwab account to the Roth account
Suze: at Fidelity. Here's the question:
Suze: Right after that, I converted my traditional IRA about $30,000
Suze: into the Roth, and I know I will owe taxes.
Suze: The conversion has its own 5 year clock which I
Suze: read starting January 1st of the year I did the conversion.
Suze: So in my case, can I withdraw the money I converted.
Suze: But I have to wait 5 years to withdraw any
Suze: earnings on the converted amount. Is that right?
KT: I believe, yes.
Suze: You're thinking about this?
KT: Yeah, I think.
Suze: Again, she's...
KT: Wait, wait, wait, wait, hold on, 65.
KT: Hm.
Suze: And she had a Roth all the way back to 1994.
KT: I think that um, I think the doctor's exempt
KT: from having to owe anything at this point.
Suze: Ding ding ding ding. Because when you converted, Doc,
Suze: into a Roth IRA that had already met the 5
Suze: year time clock and you are over 59 and a half,
Suze: you can take anything you want out without taxes or
Suze: penalties whatsoever.
KT: I learned um from all of Suzy's Roth lessons that
KT: 59.5 is a really magic number everyone just needs to remember.
Suze: And...
Suze: a Roth that has been open for at least 5 years.
Suze: All right, KT, now that's a... that's a Rothy, Frothy wrap.
Suze: All right, everybody, so until Sunday.
Suze: Though it looks like we have a hurricane possibly coming
Suze: our
Suze: way.
KT: Yeah, we're in the season, Suze.
Suze: So there's one this Invest 94, I think it is.
Suze: Isn't looking so good for us. So hopefully if everything
Suze: goes the way it should because we're on our way
Suze: back now to the island now that I have flat hair.
Suze: So anyway, and so we'll see what happens, but hopefully
Suze: Sunday we'll be here with a Suze School. I'll be here.
KT: And happy birthday, Nicky.
Suze: Happy birthday, Nicky. Happy Rosh Hashana everybody.
KT: Happy New Year.
Suze: Right, Happy New Year and
Suze: Until then, there's only one thing that we want you
Suze: to remember, and it is this:
KT: People first, then money, then things.
Suze: Now you stay safe, healthy, and secure. Bye bye now.