1 00:00:46,930 --> 00:00:51,418 Suze: May 9th 2024. Welcome everybody to the Women and Money 2 00:00:51,430 --> 00:00:55,430 Suze: podcast as well as everybody smart enough to listen today 3 00:00:55,439 --> 00:00:56,659 Suze: is what KT? 4 00:00:56,979 --> 00:00:58,889 KT: Today is my brother's birthday. 5 00:01:00,970 --> 00:01:03,979 Suze: All right, tell everybody about your brother's birthday. Go on, 6 00:01:03,990 --> 00:01:04,519 Suze: go on 7 00:01:05,540 --> 00:01:09,080 Suze: What you were supposed to say there is today is what? 8 00:01:09,089 --> 00:01:11,628 Suze: Today is Ask KT and Suze Anything. 9 00:01:11,639 --> 00:01:16,410 KT: They know that. There's millions of people that have been listening to 10 00:01:16,419 --> 00:01:20,268 KT: us for years. They already know that. Let's tell them something. 11 00:01:20,279 --> 00:01:22,709 KT: They don't know. Today's my brother Bob's birthday. 12 00:01:23,110 --> 00:01:25,500 Suze: Are you telling them what they don't know? Are you 13 00:01:25,510 --> 00:01:26,190 Suze: telling them something they need to know? 14 00:01:27,599 --> 00:01:28,429 KT: What they don't know. 15 00:01:28,440 --> 00:01:28,940 Suze: They don't need to know what's coming up here. 16 00:01:30,800 --> 00:01:34,580 KT: We always called him the Mother's Day baby because it 17 00:01:34,589 --> 00:01:37,750 KT: was Mother's Day weekend in May that he was born. 18 00:01:37,760 --> 00:01:39,389 Suze: Nobody knows who you're talking about. 19 00:01:39,400 --> 00:01:41,779 KT: My brother. I said my brother Bobby's birthday. 20 00:01:42,220 --> 00:01:43,229 Suze: And how old is he? 21 00:01:43,239 --> 00:01:45,510 KT: I have no idea, but he's younger than me and 22 00:01:45,519 --> 00:01:46,910 KT: he lives in New Jersey. 23 00:01:47,900 --> 00:01:49,199 Suze: What does that tell you? 24 00:01:49,760 --> 00:01:51,599 KT: He makes the best barbecue chicken. 25 00:01:51,610 --> 00:01:53,989 Suze: That she doesn't know how old her brother... 26 00:01:54,169 --> 00:01:55,599 KT: How old is your brother? 27 00:01:56,190 --> 00:01:59,519 Suze: Well, one of them is going to be 80 believe 28 00:01:59,529 --> 00:01:59,910 Suze: it or not. 29 00:02:00,889 --> 00:02:01,910 KT: And what's the other one? 30 00:02:02,050 --> 00:02:05,680 Suze: The other one is gonna be 77. He was 77. 31 00:02:06,470 --> 00:02:08,889 Suze: Ok. So it took you a little while to get that. 32 00:02:09,699 --> 00:02:10,960 Suze: All right. Let's get on with it. 33 00:02:10,970 --> 00:02:11,800 Suze: But I got it out. 34 00:02:12,160 --> 00:02:12,869 KT: Let's get on with it. 35 00:02:12,880 --> 00:02:17,389 Suze: I have to say something before we start. As you know, 36 00:02:18,110 --> 00:02:22,250 Suze: this is Ask KT and Suze Anything. So if you want 37 00:02:22,649 --> 00:02:25,210 Suze: to ask a question in the hopes that Miss Travis 38 00:02:25,220 --> 00:02:29,359 Suze: picks it to be answered on this podcast that you 39 00:02:29,369 --> 00:02:37,240 Suze: have to write into Ask Suze Suze podcast at gmail.com 40 00:02:37,508 --> 00:02:40,250 Suze: and we read them and if KT likes it, she 41 00:02:40,258 --> 00:02:43,250 Suze: chooses it. But this is what I want to tell you. 42 00:02:43,910 --> 00:02:46,940 Suze: You don't necessarily get a notice back that says, oh, 43 00:02:46,949 --> 00:02:51,559 Suze: we're gonna be doing your question this week. So you 44 00:02:51,570 --> 00:02:55,300 Suze: have to have to listen to listen. If we just listen, 45 00:02:55,369 --> 00:02:58,579 Suze: just listen. That's number one, number two, 46 00:02:59,330 --> 00:03:03,289 Suze: I want all of you to go and join up 47 00:03:03,300 --> 00:03:06,199 Suze: for the Women and Community app. You do that by 48 00:03:06,210 --> 00:03:09,059 Suze: going to Apple Apps or Google Play. 49 00:03:09,380 --> 00:03:11,210 Suze: And the reason I want you to do that is 50 00:03:11,220 --> 00:03:14,619 Suze: that is where I post charts and I make comments 51 00:03:14,729 --> 00:03:18,800 Suze: and things that you should know sometimes photos and sometimes 52 00:03:18,809 --> 00:03:22,679 Suze: photos that I don't post anywhere else. But recently I 53 00:03:22,690 --> 00:03:27,179 Suze: posted for everybody that there seems to be a scammer 54 00:03:27,190 --> 00:03:29,440 Suze: out there who is using my picture, 55 00:03:30,246 --> 00:03:33,876 Suze: asking you for your email making it sound like they 56 00:03:33,886 --> 00:03:37,285 Suze: are me. I'm gonna tell you this right now and 57 00:03:37,296 --> 00:03:41,955 Suze: this will never ever change. Suze Orman herself will never 58 00:03:41,966 --> 00:03:47,705 Suze: want your email address. Your phone number. Any information about you. 59 00:03:47,805 --> 00:03:49,835 Suze: When you go to my alliant 60 00:03:49,932 --> 00:03:52,832 Suze: dot com and you take the quiz and you put 61 00:03:52,841 --> 00:03:58,511 Suze: your email in there. That's for my alliant.com for Alliant 62 00:03:58,522 --> 00:04:02,572 Suze: Credit Union. Not for me. I would never see your 63 00:04:02,582 --> 00:04:05,761 Suze: emails there. I would never see your names there. That 64 00:04:05,772 --> 00:04:10,751 Suze: is private information between you and Alliant and it will 65 00:04:10,761 --> 00:04:12,852 Suze: be there by the way and you only have till 66 00:04:12,861 --> 00:04:15,472 Suze: June 5th my birthday to do it. Where if you 67 00:04:15,481 --> 00:04:19,671 Suze: go to my alliant.com and take the quiz, that's right there. 68 00:04:20,190 --> 00:04:23,970 Suze: Put in your email, one of you will be selected 69 00:04:23,980 --> 00:04:28,558 Suze: and win $5000. All right, KT. 70 00:04:29,029 --> 00:04:29,700 KT: You ready? 71 00:04:29,709 --> 00:04:29,988 Suze: No. 72 00:04:32,260 --> 00:04:33,130 KT: Are you ready? 73 00:04:33,140 --> 00:04:34,940 Suze: No, there's one more thing. 74 00:04:35,329 --> 00:04:35,980 KT: What is it? 75 00:04:36,040 --> 00:04:39,630 Suze: What is one week from today? Think about it. Think 76 00:04:39,640 --> 00:04:42,140 Suze: about it. This is your quizzy. Think about it. 77 00:04:42,149 --> 00:04:46,049 KT: We are leaving for our safari, Suze and I are 78 00:04:46,059 --> 00:04:50,459 KT: going on safari with some family members. We are so excited. 79 00:04:50,730 --> 00:04:53,500 KT: This was a promise we made to Travis and Sophia 80 00:04:53,510 --> 00:04:57,230 KT: when they were, I think six and nine years old They 81 00:04:57,238 --> 00:05:00,049 KT: were very young. They were so young they couldn't go on. 82 00:05:00,059 --> 00:05:02,929 Suze: Of course, Aunt Susie said, one day we'll take you 83 00:05:02,940 --> 00:05:06,450 Suze: when you're older on a safari. Well, guess what? Now 84 00:05:06,459 --> 00:05:09,149 Suze: that they're in their mid twenties, we decided, All right, 85 00:05:09,160 --> 00:05:09,910 Suze: they're older. 86 00:05:10,420 --> 00:05:12,079 Suze: Why are we doing it now, KT? 87 00:05:12,089 --> 00:05:14,510 KT: Before they get married? 88 00:05:14,519 --> 00:05:16,799 Suze: Because who knows if we're going to like who they marry. 89 00:05:16,809 --> 00:05:18,350 Suze: But let's just hope we do. 90 00:05:20,470 --> 00:05:24,859 KT: Ok. First question I have is from Vena. She's, by 91 00:05:24,869 --> 00:05:27,890 KT: the way, Suze, she's 52 years old. Just keep, keep 92 00:05:27,899 --> 00:05:28,489 KT: that in mind. 93 00:05:28,820 --> 00:05:31,720 KT: So she said Suze, would it be ok to withdraw 94 00:05:31,730 --> 00:05:38,579 KT: $10,000 from my Roth IRA to increase my emergency fund? 95 00:05:38,709 --> 00:05:43,559 KT: I currently have 9000 in emergency funding in a high 96 00:05:43,570 --> 00:05:47,809 KT: yield savings account with Amex. I've been maximizing my Roth 97 00:05:47,820 --> 00:05:51,329 KT: IRA for the last nine years. So sweet. 98 00:05:51,339 --> 00:05:54,200 Suze: Right, girlfriend. Listen to me. Have you ever heard 99 00:05:54,274 --> 00:05:59,303 Suze: say before that it's absolutely ok to use your Roth 100 00:05:59,315 --> 00:06:05,065 Suze: IRA as a substitute emergency fund. And why is that 101 00:06:05,214 --> 00:06:10,924 Suze: because any money you originally put in to a Roth Ira, 102 00:06:11,464 --> 00:06:15,255 Suze: you can take out at any time without taxes or 103 00:06:15,265 --> 00:06:19,084 Suze: penalties regardless of your age or how long it's been 104 00:06:19,095 --> 00:06:19,613 Suze: in there. 105 00:06:19,890 --> 00:06:23,410 Suze: So, if you were to take that $10,000 right now 106 00:06:23,420 --> 00:06:26,269 Suze: that you have in your Roth, that maybe it's just 107 00:06:26,279 --> 00:06:29,040 Suze: sitting in cash or whatever, why not just put that 108 00:06:29,049 --> 00:06:34,500 Suze: within the Roth IRA into a high yield savings account 109 00:06:34,529 --> 00:06:37,549 Suze: wherever you are holding it. So you are making the 110 00:06:37,559 --> 00:06:40,190 Suze: exact same interest rate is probably you're making 111 00:06:40,410 --> 00:06:44,049 Suze: on your savings account outside of your Roth. So just 112 00:06:44,059 --> 00:06:46,850 Suze: do it that way. But no, don't take it out 113 00:06:46,859 --> 00:06:50,070 Suze: of the Roth to put it in a high yield 114 00:06:50,079 --> 00:06:53,630 Suze: savings account since you can do it within your Roth. 115 00:06:53,640 --> 00:06:55,958 Suze: All right. Ok. Next question. 116 00:06:55,970 --> 00:06:57,049 Suze: Should that have been your quizzy? 117 00:06:57,359 --> 00:06:58,029 KT: No 118 00:06:59,089 --> 00:07:02,329 Suze: No, no, because you would have gotten it wrong. 119 00:07:02,339 --> 00:07:04,799 KT: No, I would have definitely gotten it right. You don't 120 00:07:04,809 --> 00:07:07,308 KT: take money out of the Roth to put into an 121 00:07:07,320 --> 00:07:10,230 KT: emergency fund savings account. It goes the other way. 122 00:07:10,239 --> 00:07:11,929 Suze: And the other thing, I just have to say one 123 00:07:11,940 --> 00:07:14,609 Suze: thing for everybody, the reason that I don't have a 124 00:07:14,619 --> 00:07:19,390 Suze: problem with you using your Roth IRA as your emergency 125 00:07:19,399 --> 00:07:22,959 Suze: funding is because number one of what I just said 126 00:07:22,970 --> 00:07:24,790 Suze: that you can take it out any time you want 127 00:07:24,799 --> 00:07:27,940 Suze: without taxes or penalties. However, 128 00:07:28,380 --> 00:07:31,839 Suze: there's a limit every year you can only put in 129 00:07:31,850 --> 00:07:37,000 Suze: depending on age seven or $8000 this year into your Roth. 130 00:07:37,200 --> 00:07:41,029 Suze: As the years go on. If you don't take advantage 131 00:07:41,040 --> 00:07:46,230 Suze: of those contributions, then you've lost that ability. So let's 132 00:07:46,239 --> 00:07:49,619 Suze: say all of a sudden, you not only have a 133 00:07:49,630 --> 00:07:52,239 Suze: lot of money in your Roth emergency fund, 134 00:07:52,480 --> 00:07:56,380 Suze: but now you were able to also save money in 135 00:07:56,390 --> 00:08:00,700 Suze: a high yield savings account somewhere that is your emergency fund, 136 00:08:01,019 --> 00:08:04,279 Suze: then the money that's in your Roth that you wouldn't 137 00:08:04,290 --> 00:08:08,200 Suze: have had in your Roth. Otherwise you could start investing 138 00:08:08,209 --> 00:08:13,820 Suze: for your retirement. Brilliant, brilliant strategy if I must say 139 00:08:13,829 --> 00:08:15,750 Suze: so myself. All right. 140 00:08:15,760 --> 00:08:19,839 KT: You are brilliant. Ok. Next question is from Laurie. Hi, Suze. 141 00:08:19,850 --> 00:08:23,390 KT: I have $18,000 in credit card debt. 142 00:08:24,500 --> 00:08:25,649 Suze: Ok. That's good. 143 00:08:26,399 --> 00:08:29,230 Suze: Could have been 30 it could have been 50. 144 00:08:29,239 --> 00:08:31,769 KT: It should be zero. Laurie, in my opinion. 145 00:08:31,779 --> 00:08:33,799 Suze: But listen to me, you shouldn't feel bad because you 146 00:08:33,809 --> 00:08:34,820 Suze: have $18,000. 147 00:08:35,799 --> 00:08:39,130 KT: Laurie has a plan and she needs your advice. Is 148 00:08:39,140 --> 00:08:42,140 KT: it better to get a new credit card that I 149 00:08:42,150 --> 00:08:45,630 KT: can transfer my balances over to and pay it off 150 00:08:45,640 --> 00:08:45,890 KT: in 20 151 00:08:45,984 --> 00:08:50,664 KT: 21 months with zero interest or make the minimum payment 152 00:08:50,674 --> 00:08:54,434 KT: plus the interest so I can pay it off faster. 153 00:08:54,635 --> 00:08:59,104 Suze: What you didn't answer in your email or tell us about, 154 00:08:59,114 --> 00:09:02,395 Suze: Laurie was what is the current interest rate that you 155 00:09:02,405 --> 00:09:06,835 Suze: are paying on your credit card? I bet any amount 156 00:09:06,844 --> 00:09:10,244 Suze: of money it's above 0%. 157 00:09:10,690 --> 00:09:16,949 Suze: So for $18,000 would I do a balance transfer? The 158 00:09:16,960 --> 00:09:20,789 Suze: question isn't, would I the question for you is, can 159 00:09:20,799 --> 00:09:24,719 Suze: you because if you don't have a really great FICO 160 00:09:24,729 --> 00:09:29,900 Suze: score in most cases, 760 or 780 or above, you're 161 00:09:29,909 --> 00:09:31,799 Suze: not gonna be able to do that. But you should 162 00:09:31,809 --> 00:09:35,840 Suze: at least try to see if in fact somebody accepts you. 163 00:09:36,010 --> 00:09:37,789 Suze: It is also possible 164 00:09:38,289 --> 00:09:43,700 Suze: that when you do a balance transfer of $18,000 you're 165 00:09:43,710 --> 00:09:48,909 Suze: going to have to pay approximately a 3% balance transfer 166 00:09:48,919 --> 00:09:53,580 Suze: fee to get it into your new card. Therefore, about 167 00:09:53,590 --> 00:09:58,069 Suze: $540 is going to have to be paid to do that. 168 00:09:58,650 --> 00:10:08,380 Suze: However, at $18,000 at 0% versus $18,000 on a credit card, 169 00:10:08,390 --> 00:10:11,960 Suze: a lot higher than that. I'm sure it is if 170 00:10:11,969 --> 00:10:15,599 Suze: you can absolutely worth your while to do a 171 00:10:15,724 --> 00:10:19,824 Suze: balance transfer at 0%. Next question, KT. 172 00:10:19,835 --> 00:10:24,025 KT: Ok. This is from Eleanor. She said, Suze, my husband 173 00:10:24,034 --> 00:10:29,054 KT: died in 2019. I took his social security as a 174 00:10:29,065 --> 00:10:32,775 KT: widow benefit at the time I was 65. 175 00:10:33,090 --> 00:10:36,530 KT: I've continued part time work and wanna know that when 176 00:10:36,539 --> 00:10:40,750 KT: I turn 72 can I switch to my social security? 177 00:10:40,760 --> 00:10:42,500 KT: As I think it will be more. 178 00:10:42,520 --> 00:10:46,710 Suze: So, first of all, we always, it's so sad. It's 179 00:10:46,719 --> 00:10:50,710 Suze: so sad when any of us lose somebody that we love. 180 00:10:50,974 --> 00:10:55,314 Suze: And even though it's five years ago that that happened 181 00:10:55,325 --> 00:10:58,244 Suze: for you, Eleanor, I know there's always still pain, there 182 00:10:58,255 --> 00:11:01,965 Suze: will be pain forever on some level, but still our 183 00:11:01,974 --> 00:11:06,085 Suze: condolences go out to you even at this time. First 184 00:11:06,094 --> 00:11:09,705 Suze: of all, it's not when you turn 72 it's when 185 00:11:09,715 --> 00:11:11,905 Suze: you turn 70. 186 00:11:12,369 --> 00:11:14,500 Suze: I think a lot of you, by the way, are 187 00:11:14,510 --> 00:11:19,820 Suze: getting when Mac Social Security is for you because of 188 00:11:19,830 --> 00:11:23,830 Suze: when it used to be 72 for your required minimum 189 00:11:23,840 --> 00:11:27,640 Suze: distributions from your retirement accounts. Now, by the way, that 190 00:11:27,650 --> 00:11:30,500 Suze: is 73. So 191 00:11:30,830 --> 00:11:35,729 Suze: after the age of 70 your social security does not 192 00:11:35,739 --> 00:11:40,340 Suze: continue to increase like it did from your full retirement 193 00:11:40,349 --> 00:11:43,729 Suze: age all the way up till 70. So, yes, you 194 00:11:43,739 --> 00:11:48,489 Suze: can absolutely switch to your social security if your social 195 00:11:48,500 --> 00:11:50,479 Suze: security is higher 196 00:11:50,900 --> 00:11:54,900 Suze: than what you are getting right now in widow benefits. 197 00:11:55,140 --> 00:11:57,890 Suze: That's the answer. Go on KT. 198 00:11:57,900 --> 00:12:00,760 KT: Ok. This is from Julie Suze. You're on a roll 199 00:12:00,770 --> 00:12:04,320 KT: this morning. I like it like the energy from Julie. 200 00:12:04,330 --> 00:12:08,969 KT: I'm 66. I own a home with about $80,000 in equity. 201 00:12:09,575 --> 00:12:12,454 KT: What document do I need to have in place for 202 00:12:12,465 --> 00:12:15,655 KT: my sons so that they will be able to take 203 00:12:15,664 --> 00:12:20,244 KT: ownership and sell my home. I'm assuming when she passes, 204 00:12:20,255 --> 00:12:21,294 KT: but she didn't say that. 205 00:12:21,304 --> 00:12:24,775 Suze: So it just depends on your situation really as to, 206 00:12:24,784 --> 00:12:28,525 Suze: are you gonna be keeping this home? Are you selling it? Obviously, 207 00:12:28,585 --> 00:12:31,534 Suze: you could put the name of your sons on your 208 00:12:31,544 --> 00:12:32,164 Suze: home 209 00:12:32,469 --> 00:12:35,939 Suze: as joint tendency with right of survivorship. So that the 210 00:12:35,950 --> 00:12:40,309 Suze: day that you die, it automatically passes to them. But 211 00:12:40,320 --> 00:12:42,750 Suze: then there's all kinds of things that can go wrong 212 00:12:42,760 --> 00:12:47,630 Suze: with that scenario, meaning that maybe your house has gone 213 00:12:47,640 --> 00:12:50,570 Suze: up significantly in value since you purchased it. 214 00:12:50,929 --> 00:12:54,520 Suze: And if you do that, then you're giving your sons 215 00:12:54,590 --> 00:12:58,109 Suze: your cost basis on the house as well. So the 216 00:12:58,119 --> 00:13:01,919 Suze: truth of the matter is the best way financially to 217 00:13:01,929 --> 00:13:05,520 Suze: pass an asset like a house down to your children 218 00:13:05,570 --> 00:13:08,750 Suze: is by having a revocable living trust 219 00:13:09,289 --> 00:13:14,848 Suze: where their names are the successor beneficiaries. Obviously, you would 220 00:13:14,859 --> 00:13:18,619 Suze: be the primary beneficiary. You are the trustor, the one 221 00:13:18,630 --> 00:13:21,640 Suze: who has created the trust. You are the trustee, the 222 00:13:21,650 --> 00:13:23,960 Suze: one that decides. Do you want to sell it? What 223 00:13:23,969 --> 00:13:25,630 Suze: do you want to do with it? Do you want 224 00:13:25,640 --> 00:13:28,108 Suze: to eliminate one of your sons? What do you want? 225 00:13:28,919 --> 00:13:32,858 Suze: And you are the beneficiary as well, the primary beneficiary 226 00:13:32,869 --> 00:13:36,909 Suze: because it's held for your benefit while you are alive 227 00:13:36,919 --> 00:13:40,460 Suze: on your death. It goes to your sons as the 228 00:13:40,469 --> 00:13:45,460 Suze: successor beneficiary. That is the correct way that you should 229 00:13:45,469 --> 00:13:46,760 Suze: do it next KT. 230 00:13:46,770 --> 00:13:50,809 KT: OK. This is from Donna. Hi Suze and KT. You 231 00:13:50,820 --> 00:13:54,579 KT: are both such a blessing. Thank you for continuing to 232 00:13:54,590 --> 00:13:57,419 KT: shower us with financial wisdom. 233 00:13:57,989 --> 00:13:59,598 KT: I think she means you. 234 00:13:59,609 --> 00:14:02,140 Suze: Don't you ever put yourself down. 235 00:14:02,190 --> 00:14:02,960 KT: I'm not. 236 00:14:02,989 --> 00:14:04,719 Suze: Don't say I think it's you, you... 237 00:14:04,979 --> 00:14:08,130 KT: I think it's you that shower us with financial wisdom. 238 00:14:08,250 --> 00:14:09,348 KT: I asked the questions. 239 00:14:09,469 --> 00:14:11,489 Suze: I want you to listen to me, Miss Travis and 240 00:14:11,500 --> 00:14:13,549 Suze: you listen to me right here. And right now. 241 00:14:13,630 --> 00:14:18,059 KT: Slap down, slap down, Everybody that's called a Suze slap down. 242 00:14:19,729 --> 00:14:23,609 Suze: Your love, your generosity of spirit, 243 00:14:24,059 --> 00:14:28,289 Suze: your entire being of who you are. 244 00:14:29,070 --> 00:14:34,309 Suze: Combines everything I have ever said about money. Money isn't 245 00:14:34,320 --> 00:14:38,359 Suze: just about money. Money is not just about what you have. 246 00:14:38,460 --> 00:14:41,960 Suze: It's about who you are as well and you bring 247 00:14:41,969 --> 00:14:43,609 Suze: to this podcast, 248 00:14:44,369 --> 00:14:49,750 Suze: the love and the understanding and all of it that 249 00:14:49,760 --> 00:14:52,590 Suze: is needed. So you are vitally important. 250 00:14:52,659 --> 00:14:57,309 KT: Thank you so much. So, this is what Donna is asking. I've 251 00:14:57,320 --> 00:14:59,789 KT: been blessed to be in a position in which I 252 00:14:59,799 --> 00:15:03,950 KT: earn too much money to qualify for a Roth. How 253 00:15:03,960 --> 00:15:07,520 KT: can I establish and fund one now with at least 254 00:15:07,530 --> 00:15:09,989 KT: a dollar for future conversions? 255 00:15:10,619 --> 00:15:13,169 KT: And then I love this. Your podcast is the best 256 00:15:13,179 --> 00:15:16,400 KT: part of my Thursday morning. So I didn't know you 257 00:15:16,409 --> 00:15:17,880 KT: can fund it with a dollar. 258 00:15:18,169 --> 00:15:20,960 Suze: Well, you could actually fund it with anything you want. 259 00:15:21,090 --> 00:15:22,919 Suze: And the main reason, 260 00:15:22,969 --> 00:15:24,640 KT: I mean, as little as a dollar... 261 00:15:25,539 --> 00:15:29,299 Suze: As little as 50 cents if you want serious, stop it, 262 00:15:29,309 --> 00:15:33,849 Suze: KT don't get me off track here. I see. Right now, 263 00:15:34,450 --> 00:15:38,729 Suze: I complimented her and now look at her like, now 264 00:15:38,739 --> 00:15:41,450 Suze: she just wants to take over the entire podcast anyway. 265 00:15:41,809 --> 00:15:43,679 KT: Ok, I do, but not today. 266 00:15:43,690 --> 00:15:48,229 Suze: All right. That's good. So, here's the thing Donna is 267 00:15:48,239 --> 00:15:51,070 Suze: that the main reason that you want to start a 268 00:15:51,080 --> 00:15:52,650 Suze: Roth IRA 269 00:15:53,200 --> 00:15:56,750 Suze: is if you have money that's in a Roth 401k 270 00:15:56,760 --> 00:16:01,289 Suze: A Roth TSP A Roth 403 B, whatever, it may 271 00:16:01,299 --> 00:16:05,140 Suze: be a Roth IRA. A Roth Simple. You name it 272 00:16:05,780 --> 00:16:09,280 Suze: and you want to transfer it from where it happens 273 00:16:09,289 --> 00:16:14,880 Suze: to be at your ex-employer when you transfer it into 274 00:16:14,890 --> 00:16:19,669 Suze: a Roth IRA, then the time limit has already started 275 00:16:19,809 --> 00:16:23,039 Suze: and then you don't have to wait any time to do. So, 276 00:16:23,049 --> 00:16:27,340 Suze: does that make sense? The problem is when you convert, 277 00:16:27,809 --> 00:16:32,869 Suze: you convert from a traditional account to a Roth, regardless 278 00:16:32,880 --> 00:16:36,030 Suze: of how long the Roth IRA has been opened, 279 00:16:36,710 --> 00:16:41,250 Suze: the five year time period still starts every time there 280 00:16:41,260 --> 00:16:46,770 Suze: is a conversion. But given that you don't qualify for 281 00:16:46,780 --> 00:16:47,770 Suze: a Roth, 282 00:16:48,460 --> 00:16:51,140 Suze: I don't think I would be worried about it so 283 00:16:51,150 --> 00:16:55,780 Suze: much right now in your particular situation. All right. 284 00:16:55,789 --> 00:16:59,960 KT: Hi, Suze. My name is Roosevelt. I'm 59 years old, 285 00:16:59,969 --> 00:17:04,229 KT: single and living in Charlotte, North Carolina, by the way, 286 00:17:04,239 --> 00:17:07,438 KT: I love your TV show. So he watches you on Freebie. 287 00:17:07,449 --> 00:17:11,119 KT: All of you should watch the Suze Orman show on FreeVee. 288 00:17:11,550 --> 00:17:15,050 KT: So, here's the bottom line. His birthday is coming up 289 00:17:15,060 --> 00:17:19,510 KT: on May 17th. He pays $60 every three months for 290 00:17:19,520 --> 00:17:23,540 KT: his insurance term insurance, but it's gonna be renewed at 291 00:17:24,140 --> 00:17:26,489 KT: $160 every three months. 292 00:17:27,050 --> 00:17:30,339 KT: What his concern is and he's got savings. He has 293 00:17:30,349 --> 00:17:34,630 KT: a CD annuity. He has no expenses and his home's 294 00:17:34,640 --> 00:17:38,430 KT: paid off. So, here's the bottom line. He wants to know. 295 00:17:38,439 --> 00:17:42,189 KT: Should he drop the policy and just put money aside 296 00:17:42,329 --> 00:17:43,189 KT: that will allow 297 00:17:43,775 --> 00:17:47,774 KT: to be buried with his loved ones in California in LA. 298 00:17:48,344 --> 00:17:49,514 KT: That's his question. 299 00:17:49,714 --> 00:17:51,734 Suze: So wait, give me this for just one second. Let me 300 00:17:51,744 --> 00:17:54,564 Suze: see it because usually there's a lot of information on 301 00:17:54,574 --> 00:17:57,555 Suze: these emails that if we read it, it would just 302 00:17:57,564 --> 00:17:59,515 Suze: be way too long. 303 00:17:59,930 --> 00:18:02,510 Suze: He has a lot of money in savings. He's fine. 304 00:18:02,540 --> 00:18:05,589 Suze: He has one son, 36 years old who lives on 305 00:18:05,599 --> 00:18:09,069 Suze: his own. So here is the real question, everybody. Do 306 00:18:09,079 --> 00:18:12,829 Suze: you want insurance or do you need insurance? If you 307 00:18:12,839 --> 00:18:18,609 Suze: simply want insurance, don't waste your money if you need it. 308 00:18:18,650 --> 00:18:19,750 Suze: That's another 309 00:18:19,935 --> 00:18:24,395 Suze: story. So I have to tell you, Roosevelt, I would 310 00:18:24,405 --> 00:18:27,073 Suze: not be doing this. You have enough money that you 311 00:18:27,084 --> 00:18:31,104 Suze: could just put $10,000 aside or whatever it is and 312 00:18:31,114 --> 00:18:33,435 Suze: just pay for it on your own. But insurance is 313 00:18:33,444 --> 00:18:38,305 Suze: not the way to do it, by the way. Happy birthday. 314 00:18:38,314 --> 00:18:38,915 Suze: All right. 315 00:18:38,925 --> 00:18:43,194 KT: Ok. Next is from Lou Ann. Hi. I don't know 316 00:18:43,204 --> 00:18:44,375 KT: where to start. 317 00:18:45,829 --> 00:18:48,619 KT: I love these. I don't know where to start. Oh, no, 318 00:18:49,209 --> 00:18:51,000 KT: I don't know where to start. 319 00:18:51,689 --> 00:18:55,669 KT: So basically she feels like she's stuck. She said I 320 00:18:55,680 --> 00:19:00,109 KT: have a small IRA around 150,000. A nice checking account, 321 00:19:00,119 --> 00:19:04,219 KT: small savings. I live in a condo. I can't stand it. 322 00:19:05,920 --> 00:19:08,419 KT: She can't stand the condo. You never know till you 323 00:19:08,430 --> 00:19:11,589 KT: move in. I've been here for one year and four months. 324 00:19:11,750 --> 00:19:15,459 KT: So she definitely wants out Suze. She's counting down how 325 00:19:15,469 --> 00:19:17,660 KT: long she's lived in her condo. 326 00:19:18,040 --> 00:19:21,300 KT: She said I want to move. I feel like I'm stuck. 327 00:19:21,310 --> 00:19:24,060 KT: I don't have a big down payment after sinking a 328 00:19:24,069 --> 00:19:29,659 KT: lot of money in this. Not so nice place, any suggestions? 329 00:19:29,949 --> 00:19:32,829 Suze: So it's a little confusing. KT, well, she's been there 330 00:19:32,839 --> 00:19:36,060 Suze: a year. She says I don't have a big down 331 00:19:36,069 --> 00:19:39,169 Suze: payment for a home, for a new home. What happens 332 00:19:39,180 --> 00:19:41,479 Suze: is she sells this one? She has to, she wants 333 00:19:41,489 --> 00:19:43,579 Suze: to sell it. So here's the thing, Lou Ann, 334 00:19:44,140 --> 00:19:48,819 Suze: there's people first, then money, then things, you've heard me 335 00:19:48,829 --> 00:19:54,429 Suze: say it over and over again. You cannot continue to 336 00:19:54,439 --> 00:19:59,479 Suze: live in a place that you hate. 337 00:19:59,829 --> 00:20:04,449 Suze: All right, you just can't do that it right. You 338 00:20:04,459 --> 00:20:09,109 Suze: can't feel stuck. You have to put yourself in front 339 00:20:09,140 --> 00:20:12,410 Suze: of your money. At this point in time, you are 340 00:20:12,420 --> 00:20:15,390 Suze: never stuck. Even if you have to take a loss 341 00:20:15,400 --> 00:20:15,520 Suze: to 342 00:20:15,604 --> 00:20:21,614 Suze: move somewhere fine. Now, there's nothing wrong with you selling it, 343 00:20:21,625 --> 00:20:25,084 Suze: getting out of there, maybe renting for a little bit 344 00:20:25,094 --> 00:20:28,665 Suze: until you can figure out where you want to live, 345 00:20:28,675 --> 00:20:31,204 Suze: what you really want to do 346 00:20:31,910 --> 00:20:36,239 Suze: and then see what you can afford and what makes sense. 347 00:20:36,250 --> 00:20:40,599 Suze: But put that condo on the market right now. Now 348 00:20:40,609 --> 00:20:43,250 Suze: I just have to say something. I'm the one who 349 00:20:43,260 --> 00:20:43,770 Suze: put 350 00:20:44,170 --> 00:20:48,609 Suze: the word hate into Lou Ann's mouth. She says she can't 351 00:20:48,619 --> 00:20:52,949 Suze: stand it. That's how she said it. That translates to me. 352 00:20:52,959 --> 00:20:59,339 Suze: She hates it. Figure out the money later on, I 353 00:20:59,349 --> 00:21:02,020 Suze: have another real estate one I picked because this one 354 00:21:02,030 --> 00:21:04,629 Suze: made me like, whoa, these things happen. 355 00:21:04,939 --> 00:21:09,030 KT: This is hi, Suze, my wife and I will retire 356 00:21:09,040 --> 00:21:11,959 KT: in about eight years. Our home will be paid off 357 00:21:11,969 --> 00:21:15,479 KT: in 10 years. We have an emergency fund. We have 358 00:21:15,489 --> 00:21:18,839 KT: no credit card debt. So the home will be paid 359 00:21:18,849 --> 00:21:21,339 KT: off in about 10 years. We would love to stay 360 00:21:21,349 --> 00:21:25,020 KT: in this home until we die. We do not want 361 00:21:25,140 --> 00:21:28,438 KT: to leave the house to the Children. We do have 362 00:21:28,449 --> 00:21:31,680 KT: a will and a trust. My question is, is there 363 00:21:31,689 --> 00:21:33,469 KT: any way to get cash 364 00:21:33,584 --> 00:21:37,764 KT: out of our home without refinancing a home equity loan? 365 00:21:37,814 --> 00:21:41,515 KT: Would you recommend a reverse mortgage? We would like to 366 00:21:41,525 --> 00:21:44,324 KT: cash out the equity which is about half a million 367 00:21:44,334 --> 00:21:49,405 KT: dollars instead of moving, selling or leaving it to the Children. 368 00:21:49,750 --> 00:21:52,760 KT: So they basically want to live off this home and 369 00:21:52,770 --> 00:21:53,489 KT: die in this home. 370 00:21:53,500 --> 00:21:57,609 Suze: Ok. Ok. Now my dear Teresa... KT, what do you think? 371 00:21:57,859 --> 00:22:00,069 Suze: They don't want to leave their house to their kids? 372 00:22:00,079 --> 00:22:00,849 Suze: Not a big deal. 373 00:22:00,859 --> 00:22:03,969 KT: I think they want to retire and actually use the 374 00:22:03,979 --> 00:22:06,890 KT: equity in that home to live on 375 00:22:07,410 --> 00:22:10,270 KT: so that they, you know, they don't want to leave. 376 00:22:10,359 --> 00:22:14,040 KT: They definitely don't want, don't want to leave that says 377 00:22:14,189 --> 00:22:16,649 KT: do not in capital letters. 378 00:22:16,920 --> 00:22:20,310 Suze: But Teresa, here's the thing I need you to understand 379 00:22:21,069 --> 00:22:24,329 Suze: in this email, you say that you're going to retire 380 00:22:24,339 --> 00:22:28,129 Suze: in eight years and then you say that your home 381 00:22:28,140 --> 00:22:32,000 Suze: will be paid off in 10 years. You did not 382 00:22:32,010 --> 00:22:34,729 Suze: tell me how old you happen to be, 383 00:22:35,040 --> 00:22:38,900 Suze: but when it comes to a reverse mortgage. You have 384 00:22:38,910 --> 00:22:42,869 Suze: to be at least 62 years of age or older. 385 00:22:43,020 --> 00:22:47,260 Suze: And the very best circumstance to do a reverse mortgage 386 00:22:47,390 --> 00:22:50,589 Suze: is when you own your home outright. There are other 387 00:22:50,599 --> 00:22:53,500 Suze: ways that you can do it, even if you don't 388 00:22:53,510 --> 00:22:56,839 Suze: own your house outright. But I wouldn't suggest that. So 389 00:22:56,849 --> 00:23:01,140 Suze: we are now looking 10 years off from now 390 00:23:01,670 --> 00:23:04,400 Suze: and here's what I'd like to say to you a 391 00:23:04,489 --> 00:23:09,939 Suze: lot can happen in 10 years. So to be thinking 392 00:23:09,949 --> 00:23:13,089 Suze: about what is the best way to do it right 393 00:23:13,099 --> 00:23:18,750 Suze: now in 2024 when really the answer to this question 394 00:23:18,760 --> 00:23:23,849 Suze: will be revealed in 2034 believe it or not 395 00:23:24,199 --> 00:23:28,969 Suze: is what I want you to remember. Number one, number two, 396 00:23:28,979 --> 00:23:32,938 Suze: let's just say you retired, the house is paid off. 397 00:23:32,949 --> 00:23:37,420 Suze: You're 62 years of age or older. Would I recommend 398 00:23:37,430 --> 00:23:42,260 Suze: a reverse mortgage simply for you to get money out 399 00:23:42,270 --> 00:23:43,958 Suze: of your house? Now, 400 00:23:44,670 --> 00:23:51,680 Suze: as you get older, things really do change your health, 401 00:23:51,689 --> 00:23:55,810 Suze: the maintenance on the house may get harder, things change 402 00:23:55,819 --> 00:23:59,609 Suze: things in the house, start to break 10 years from now. 403 00:24:00,209 --> 00:24:04,089 Suze: And if you do a reverse mortgage, you're pretty much 404 00:24:04,099 --> 00:24:08,089 Suze: locked in to keeping that house no matter what 405 00:24:08,650 --> 00:24:13,839 Suze: normally until you die. Because even if you then decide 406 00:24:13,849 --> 00:24:17,530 Suze: later on, you wanna sell it, you're not gonna get 407 00:24:17,540 --> 00:24:20,670 Suze: the equity out of it that you really think you 408 00:24:20,680 --> 00:24:25,359 Suze: have in it. So if you need a reverse mortgage 409 00:24:25,449 --> 00:24:27,839 Suze: to stay in that home, 410 00:24:28,670 --> 00:24:31,530 Suze: I ask you at the time when this will become 411 00:24:31,540 --> 00:24:36,310 Suze: relevant to you, that you really think about that because 412 00:24:36,319 --> 00:24:39,550 Suze: if you need a reverse mortgage to stay there, I 413 00:24:39,560 --> 00:24:42,949 Suze: would be telling you that is your first indication that 414 00:24:42,959 --> 00:24:48,869 Suze: you need to sell it and move somewhere that you 415 00:24:48,880 --> 00:24:52,510 Suze: can afford where you use the equity in your home 416 00:24:52,520 --> 00:24:56,969 Suze: to your advantage. So what you think you want right 417 00:24:56,979 --> 00:24:57,770 Suze: now 418 00:24:58,810 --> 00:25:03,869 Suze: may not be on any level, what you want 10 419 00:25:03,880 --> 00:25:09,280 Suze: years from now. So just think about that. All right, KT. 420 00:25:09,400 --> 00:25:14,050 KT: This, this um next question is very interesting. This is 421 00:25:14,060 --> 00:25:18,599 KT: from a Melissa who met you at 11. She was 422 00:25:18,609 --> 00:25:19,968 KT: 11 years old 423 00:25:20,699 --> 00:25:22,270 Suze: Or in 2011. 424 00:25:22,420 --> 00:25:24,469 KT: At 11, I met you at a book signing. No, 425 00:25:24,479 --> 00:25:28,540 KT: she said now I'm 39. No, she was 11 years old, ready. 426 00:25:28,699 --> 00:25:32,929 KT: So we're old. That, that makes sense. 11 years old. 427 00:25:32,939 --> 00:25:35,599 KT: So 20 years later, I met you at a book 428 00:25:35,609 --> 00:25:40,540 KT: signing which inspired my journey to financial independence. So you 429 00:25:40,550 --> 00:25:43,550 KT: really influenced her. You're gonna like where she's at. 430 00:25:43,939 --> 00:25:47,540 KT: I'm 39. I'm a single mom of 2, 10 and 431 00:25:47,550 --> 00:25:52,879 KT: 12 years old. I manage full financial responsibility. I own 432 00:25:52,890 --> 00:25:57,910 KT: my home outright. I built a rental property on her land, 433 00:25:57,920 --> 00:26:02,959 KT: I suppose I hold a corporate position with max contributions 434 00:26:02,969 --> 00:26:08,290 KT: to retirement, ready, ready, everyone. And I have investments totaling 435 00:26:08,300 --> 00:26:10,760 KT: around $4 million. 436 00:26:11,239 --> 00:26:14,550 KT: So, Suze Orman, you made an impression on an 11 437 00:26:14,560 --> 00:26:18,140 KT: year old little girl. Now. Ready? Wait, wait, wait, this is, 438 00:26:18,430 --> 00:26:22,479 KT: this gets even better after a tech layoff. I'm in 439 00:26:22,489 --> 00:26:23,890 KT: a less fulfilling 440 00:26:24,239 --> 00:26:28,219 KT: W-2 job. That means she gets a paycheck everyone. But 441 00:26:28,229 --> 00:26:33,489 KT: she enjoys some side consulting though. It lacks FTE benefits 442 00:26:33,640 --> 00:26:37,478 KT: as I navigate this time, employee benefits. As I now 443 00:26:37,739 --> 00:26:40,619 KT: is her question ready? This is it. I'm getting to 444 00:26:40,630 --> 00:26:44,889 KT: the question as I navigate the crossroads, she's 39. Everyone. 445 00:26:45,020 --> 00:26:48,030 KT: What advice would you give me? And how long should 446 00:26:48,040 --> 00:26:48,909 KT: I work 447 00:26:49,989 --> 00:26:54,209 KT: now? That's very interesting. She's 39. How, I mean, 448 00:26:54,920 --> 00:26:58,459 KT: it seems like she's done more than an average lifetime 449 00:26:58,469 --> 00:27:02,149 KT: worth of self accomplishments and financial savings. 450 00:27:03,969 --> 00:27:08,099 Suze: Go back to when you were 11 and you met 451 00:27:08,109 --> 00:27:12,919 Suze: me and think about what is it when you met 452 00:27:12,930 --> 00:27:13,589 Suze: me 453 00:27:14,260 --> 00:27:19,079 Suze: that allowed you to become who you happened to be? 454 00:27:19,839 --> 00:27:23,159 Suze: Because it would seem to me that you are somebody 455 00:27:23,170 --> 00:27:27,609 Suze: who is very in touch with who you are and 456 00:27:27,619 --> 00:27:28,819 Suze: what you want to be. 457 00:27:29,839 --> 00:27:32,599 Suze: And maybe you looked at me at that time and 458 00:27:32,609 --> 00:27:35,699 Suze: you said, oh, now that's a woman who knows who 459 00:27:35,709 --> 00:27:39,660 Suze: she is. Oh, that's a woman who knows what she 460 00:27:39,670 --> 00:27:44,130 Suze: wants to be. Oh, that's a woman who loves doing 461 00:27:44,140 --> 00:27:47,280 Suze: what she is doing and what she does. 462 00:27:47,920 --> 00:27:52,280 Suze: And I have a feeling that you have the ability 463 00:27:52,290 --> 00:27:57,479 Suze: to know that about yourself as well. You are probably 464 00:27:57,489 --> 00:28:00,849 Suze: in a situation that you never really have to work 465 00:28:00,859 --> 00:28:04,900 Suze: again for money. You need to understand 466 00:28:05,219 --> 00:28:10,099 Suze: that the crossroads that you stand at which are so fabulous. 467 00:28:10,170 --> 00:28:14,260 Suze: It is your choice which direction you wanna go. And 468 00:28:14,270 --> 00:28:16,379 Suze: if you start to go down a direction and you 469 00:28:16,390 --> 00:28:19,319 Suze: don't like it, it is your choice that you get 470 00:28:19,329 --> 00:28:22,319 Suze: to do a U turn. It is your choice if 471 00:28:22,329 --> 00:28:25,339 Suze: you want to try the other road or not. And again, 472 00:28:25,349 --> 00:28:28,199 Suze: if you don't like it, you can turn around 473 00:28:28,869 --> 00:28:32,679 Suze: that you have to reside in your own power, you 474 00:28:32,689 --> 00:28:36,170 Suze: have to reside in knowing what you want and what 475 00:28:36,180 --> 00:28:41,449 Suze: makes you happy. But more important than anything. You have 476 00:28:41,459 --> 00:28:43,520 Suze: two little ones 477 00:28:43,969 --> 00:28:48,420 Suze: that are 10 and 12. They are right where you were, 478 00:28:48,430 --> 00:28:51,709 Suze: you were in the middle of those two kids when 479 00:28:51,719 --> 00:28:56,229 Suze: you first met me. So let them meet a mother 480 00:28:57,170 --> 00:29:02,010 Suze: that represents the same qualities that I represented to you 481 00:29:02,020 --> 00:29:06,670 Suze: that day. So that your two Children grow up to 482 00:29:06,680 --> 00:29:09,949 Suze: be exactly like you. 483 00:29:11,089 --> 00:29:14,520 KT: Wait, I'm giving her a standing ovation. That was, that 484 00:29:14,530 --> 00:29:18,109 KT: was great. That was like Suze standing in her truth. 485 00:29:18,160 --> 00:29:21,180 Suze: Now, KT, we're almost ready for your quizzy. You have 486 00:29:21,189 --> 00:29:22,900 Suze: another one or a short one? 487 00:29:24,310 --> 00:29:29,130 KT: Yeah, let's do Karen's, I'm 70 years young. I have 488 00:29:29,140 --> 00:29:33,050 KT: no spouse or immediate family. I'm single. How can I 489 00:29:33,060 --> 00:29:36,810 KT: tell if I have enough money to last till I die? 490 00:29:36,819 --> 00:29:40,849 KT: Is there a formula I'm in good health. Please advise 491 00:29:40,859 --> 00:29:45,020 KT: 70 years young baby, younger than us, baby. She's younger 492 00:29:45,030 --> 00:29:48,050 KT: than us. How does she know what she needs in 493 00:29:48,060 --> 00:29:50,410 KT: terms of money till she dies? We don't know how 494 00:29:50,420 --> 00:29:51,369 KT: long you're gonna live. 495 00:29:51,619 --> 00:29:55,079 KT: So, here's the thing, that's a question for God. Not Suze. 496 00:29:55,430 --> 00:29:58,979 Suze: Well, it's kind of the same thing. No, just joking, joking, joking. Right. 497 00:29:58,989 --> 00:30:02,920 Suze: So here's the thing, Karen, nobody knows 498 00:30:03,689 --> 00:30:06,150 Suze: when they are no longer here 499 00:30:06,810 --> 00:30:09,209 Suze: that you know, that just will happen when it's meant 500 00:30:09,219 --> 00:30:11,229 Suze: to happen somehow. All right, 501 00:30:12,310 --> 00:30:16,310 Suze: you would look and see how much money do you 502 00:30:16,319 --> 00:30:22,329 Suze: actually have? How much income does it generate for you, 503 00:30:22,930 --> 00:30:27,890 Suze: including your social security, including all your possible other sources 504 00:30:27,900 --> 00:30:34,170 Suze: of income. How much do you generate today after taxes? 505 00:30:34,810 --> 00:30:40,479 Suze: And is your after tax income enough to pay currently 506 00:30:40,520 --> 00:30:43,189 Suze: your expenses that you have, 507 00:30:44,000 --> 00:30:47,560 Suze: if it is now you are starting from a really 508 00:30:47,569 --> 00:30:54,479 Suze: strong position as time goes on. It is possible that you, 509 00:30:54,489 --> 00:30:58,359 Suze: in fact, may need more than what you need today. 510 00:30:58,369 --> 00:31:01,079 Suze: Maybe you need a helper, maybe who knows what it 511 00:31:01,089 --> 00:31:04,819 Suze: may be. So then do a calculation 512 00:31:05,530 --> 00:31:09,540 Suze: as to at a two or 3% whatever it is, 513 00:31:09,550 --> 00:31:12,199 Suze: growth rate on your money. Just so you can be 514 00:31:12,209 --> 00:31:19,310 Suze: really conservative assuming that you took out 4% a year 515 00:31:19,810 --> 00:31:24,790 Suze: from your accounts. How long would that last? You? 516 00:31:25,489 --> 00:31:28,790 Suze: And then you'll kind of know if you have enough, 517 00:31:28,810 --> 00:31:31,780 Suze: will it last you until you're 100 years? Of age, 518 00:31:31,849 --> 00:31:35,270 Suze: will it last you till you're 110 years of age? 519 00:31:35,939 --> 00:31:38,959 Suze: If it would, I would feel pretty safe that you 520 00:31:38,969 --> 00:31:44,599 Suze: are ok. However, you just never know in life. So 521 00:31:44,609 --> 00:31:49,310 Suze: just do your homework, do that calculation. I think you 522 00:31:49,319 --> 00:31:53,560 Suze: probably will find out that you're ok. Now, if you're not, 523 00:31:54,050 --> 00:31:57,469 Suze: if you don't have enough money, given that you are 524 00:31:57,479 --> 00:32:01,829 Suze: 70 years young. All right. Find a sign job, do 525 00:32:01,839 --> 00:32:05,560 Suze: something else that brings in more money right now. 526 00:32:06,209 --> 00:32:09,229 Suze: So you can continue to contribute to a Roth IRA. 527 00:32:09,239 --> 00:32:11,949 Suze: Maybe you pay down the mortgage on your home, but 528 00:32:11,959 --> 00:32:15,069 Suze: there's always something you can do. 529 00:32:15,969 --> 00:32:18,410 Suze: She was smart enough to write in to ask Suze 530 00:32:18,420 --> 00:32:23,709 Suze: podcast at gmail.com. Are all of you smart enough? Derek 531 00:32:23,719 --> 00:32:28,579 Suze: was absolutely smart enough to write in and this is 532 00:32:28,589 --> 00:32:33,800 Suze: the "Can I Afford It?" quizzy for today's podcast. I 533 00:32:33,810 --> 00:32:38,310 Suze: will read this and you will all have to decide. 534 00:32:38,520 --> 00:32:41,589 Suze: Do you approve him or do you deny him? 535 00:32:41,839 --> 00:32:45,859 Suze: And let's see if Miss Travis gets it right. 536 00:32:46,790 --> 00:32:51,329 Suze: Dear, Suze and KT. You never left out. Are you? No? 537 00:32:51,339 --> 00:32:55,969 Suze: All right. Recently my mom gave both my brother and 538 00:32:55,979 --> 00:33:01,339 Suze: me $3500 each. Are you writing that down, KT and 539 00:33:01,349 --> 00:33:05,609 Suze: my little Suze notebook? All right, there we go. Mom 540 00:33:05,619 --> 00:33:11,530 Suze: told me I could use the money any way I wanted. However, 541 00:33:12,420 --> 00:33:15,579 Suze: she said it would be nice if I used the 542 00:33:15,589 --> 00:33:19,689 Suze: gift so that my husband and I would take a 543 00:33:19,699 --> 00:33:25,800 Suze: more relaxing vacation than we usually take. Ok, whatever that is. 544 00:33:26,329 --> 00:33:31,599 Suze: My brother, however, is an accountant and says that I 545 00:33:31,609 --> 00:33:36,800 Suze: should use the money for a vacation but should put 546 00:33:36,810 --> 00:33:42,020 Suze: all $3500 in my Roth IRA. 547 00:33:42,640 --> 00:33:47,170 Suze: He says that for a person my age, I haven't 548 00:33:47,180 --> 00:33:49,650 Suze: saved enough for retirement, 549 00:33:50,459 --> 00:33:57,530 Suze: but a modest vacation relaxing with my husband sounds very attractive. 550 00:33:57,540 --> 00:34:01,130 Suze: So here are the numbers. if we were on TV, 551 00:34:01,140 --> 00:34:06,810 Suze: I would say Derek show me the money. Derek is 552 00:34:06,819 --> 00:34:09,330 Suze: 50 years old. 553 00:34:10,250 --> 00:34:17,419 Suze: He takes home $2400 a month. His share of the 554 00:34:17,429 --> 00:34:25,549 Suze: household expenses come to $2140 per month. He has no 555 00:34:25,560 --> 00:34:29,750 Suze: debt other than the mortgage on their home, which has 556 00:34:29,760 --> 00:34:32,350 Suze: an interest rate of 3.8% 557 00:34:32,760 --> 00:34:42,819 Suze: and a balance of $88,720. His emergency fund is $26,100 558 00:34:43,489 --> 00:34:50,020 Suze: and between his Roth IRA and his 403 B at work, 559 00:34:50,030 --> 00:34:53,679 Suze: that's a pre tax account there. He only has a 560 00:34:53,689 --> 00:34:57,540 Suze: Roth IRA is a traditional 403 B at work. What 561 00:34:57,550 --> 00:34:58,939 Suze: are you thinking, Derek? 562 00:34:59,300 --> 00:35:07,600 Suze: It contains a total of $137,957. 563 00:35:08,760 --> 00:35:09,989 Suze: Can Derek 564 00:35:11,060 --> 00:35:18,810 Suze: afford to take $3500 and go on a vacation. 565 00:35:19,590 --> 00:35:23,050 Suze: A modest one with his husband. 566 00:35:25,489 --> 00:35:28,070 Suze: All right. Are you all thinking about that? Everybody 567 00:35:29,080 --> 00:35:31,790 KT: I know exactly what my answer is. 568 00:35:31,850 --> 00:35:33,899 Suze: All right. Do you all know if you're going to 569 00:35:33,909 --> 00:35:36,330 Suze: approve or deny Derek, KT? 570 00:35:37,270 --> 00:35:39,540 KT: You are so denied, Derek 571 00:35:40,050 --> 00:35:41,639 Suze: Really denied? 572 00:35:41,649 --> 00:35:46,959 KT: Absolutely no. Listen to your brother. You're 50 years old. 573 00:35:46,969 --> 00:35:51,520 KT: Take the $3500 gift, put it in the Roth and 574 00:35:51,530 --> 00:35:55,489 KT: just forget it and set it, let it grow. You 575 00:35:55,500 --> 00:36:00,639 KT: have $88,000 left on a mortgage at 3.8%. You've got... 576 00:36:00,935 --> 00:36:03,904 Suze: We know what he has in savings. He doesn't have 577 00:36:03,915 --> 00:36:06,594 Suze: that much in savings and he does have one year 578 00:36:06,604 --> 00:36:10,745 Suze: of emergency expenses, doesn't matter. He's 50 years old. His 579 00:36:10,754 --> 00:36:13,564 Suze: brother's right. Final answer. 580 00:36:13,574 --> 00:36:17,864 KT: Derek, you are DENIED. Suze goes DENIED. 581 00:36:19,784 --> 00:36:23,303 Suze: KT is absolutely correct. Although you have to just hear 582 00:36:23,314 --> 00:36:27,344 Suze: me say it, you are just so denied. I can't 583 00:36:27,354 --> 00:36:28,425 Suze: even tell you 584 00:36:29,080 --> 00:36:34,260 Suze: when you are given a gift. You should never look 585 00:36:34,270 --> 00:36:37,179 Suze: at the present value of that gift. 586 00:36:37,899 --> 00:36:43,919 Suze: Yes, it's $3500 today. What you need to think about 587 00:36:44,100 --> 00:36:48,060 Suze: is what if I took that $3500? I listened to 588 00:36:48,070 --> 00:36:52,620 Suze: my brother, I put it into a Roth IRA and 589 00:36:52,629 --> 00:36:53,159 Suze: I left it 590 00:36:53,254 --> 00:36:56,674 Suze: there for the next 20 years until I was 70 591 00:36:56,965 --> 00:37:01,754 Suze: over all that time, it was averaging about 9%. That's 592 00:37:01,764 --> 00:37:04,544 Suze: not a 9% interest rate people. One year it goes 593 00:37:04,554 --> 00:37:07,283 Suze: up one year it goes down. But in an average 594 00:37:07,294 --> 00:37:12,584 Suze: annual gain when it's averaged over 20 years, 9%. Do 595 00:37:12,594 --> 00:37:17,534 Suze: you know in 20 years from now that 3500 would 596 00:37:17,544 --> 00:37:22,134 Suze: be worth, what, $20,000? 597 00:37:22,870 --> 00:37:26,409 Suze: How do you feel about that? Now, if just out 598 00:37:26,419 --> 00:37:29,949 Suze: of curiosity, would that have changed your mind? 599 00:37:30,750 --> 00:37:35,609 Suze: So whenever you look at money, it's not what it's 600 00:37:35,620 --> 00:37:39,810 Suze: gonna cost you today, what is it going to cost 601 00:37:39,820 --> 00:37:45,770 Suze: you in future earnings in future growth? And then if 602 00:37:45,780 --> 00:37:47,290 Suze: you still want to do it and think you can 603 00:37:47,300 --> 00:37:51,770 Suze: afford it. Ok? But thank God you have a brother 604 00:37:52,020 --> 00:37:54,850 Suze: who's just a little bit smarter, 605 00:37:55,219 --> 00:38:00,290 Suze: then you. All right, KT that brings us to the end of 606 00:38:00,300 --> 00:38:05,229 Suze: another KT and Suze Anything podcast. So until Sunday, when 607 00:38:05,239 --> 00:38:08,590 Suze: we will have Suze school again, there's only one thing 608 00:38:08,600 --> 00:38:10,250 Suze: that we want you to remember when it comes to 609 00:38:10,260 --> 00:38:11,770 Suze: your money and what is it, Katie? 610 00:38:11,780 --> 00:38:15,699 Suze: It's people first, then money, then things... 611 00:38:15,709 --> 00:38:20,529 Suze: And if you live your life like that, you will be. What, KT? 612 00:38:22,830 --> 00:38:23,169 KT: Unstoppable! 613 00:38:24,909 --> 00:38:25,139 Suze: Yeah. Girlfriend.