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KT: Hi everybody. Welcome to the Women and Money podcast, and

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KT: everyone's smart enough to listen. This is KT here, and

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KT: I'm opening this on March 13th for Suze, who is

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KT: in the studio with me, but she's still suffering from

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KT: sinuses and who knows what else. Listen to this nose.

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KT: Listen to her.

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Suze: Hello, hello.

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Suze: So we thought we would get through this podcast if

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Suze: I saved my voice some because it just now came

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Suze: back after a while of me not even having one.

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Suze: Don't ask me why.

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KT: I'll answer

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KT: the questions for everyone.

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Suze: Oh, I love that.

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KT: All right, so...

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Suze: Anyway, before we start though, KT, with question and answers,

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Suze: which is very important, everybody, cause your money is far

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Suze: more than what's happening in the market. It's these little

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Suze: things that you also need to know about like converting

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Suze: a Roth, not converting it, all kinds of things. So

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Suze: we have to deal with those things as well. They're

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Suze: equally as important.

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Suze: But I told you that last Sunday I was going

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Suze: to tell you my interpretation of what's going on with

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Suze: the market. Wasn't able to, God willing, I will do

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Suze: so this Sunday, but here's the bottom line. Yeah, we're

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Suze: in for a rocky road, and I don't know which

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Suze: way that road is going to lead, and the reason

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Suze: is this the incredible uncertainty.

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Suze: Of making a decision, then it's unmade. This is going

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Suze: to happen and then it's not gonna happen on and

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Suze: off causes confusion and when not only investors like you

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Suze: are confused, but businesses are confused, governments are confused, everybody's confused,

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Suze: everybody just stops and does nothing.

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Suze: And when you do nothing it's because you're afraid. And

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Suze: what have I always told you? Fear is the greatest

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Suze: internal obstacle to wealth. So it's best to do nothing

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Suze: than something you don't understand in many cases. So I

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Suze: have no problem with just briefly saying if you're in

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Suze: good quality, everything, as I've told you, just stay put,

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Suze: but some day we'll go into greater detail after we

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Suze: figure out what happened

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Suze: this week in the market all the way through Friday.

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Suze: All right, KT.

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KT: OK, so I've got some great questions here and this

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KT: one says, hi Suze and KT, I've been listening to

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KT: you for a year and a half, and you have

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KT: made me feel much more control of my situation. And

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KT: this is from Michelle. She said, Suze, we bought our

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KT: forever house in May 2023.

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KT: To be in a better school district, we went from

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KT: a 2.5% interest rate to now having a 6% interest rate.

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KT: Our new house costs significantly more than the old one,

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KT: so our mortgage payment has more than doubled. We did

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KT: plan for this, all right, that's the key to this email, Suze.

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KT: We did plan for this. We saved to comfortably

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KT: staying afloat and figured we would be able to refinance

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KT: in 1 to 2 years. My question for you is,

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KT: at what point would we refinance when rates get to 5%

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KT: or lower? What would make a difference?

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Suze: It all depends seriously, and what it depends on is this,

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Suze: so listen closely. Many people make the mistake

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Suze: of they do a mortgage at a specific interest rate

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Suze: for let's say 30 years like you probably did at 6%

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Suze: and then you think, all right, when interest rates go

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Suze: down you'll refinance and let's say that happens 4 or

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Suze: 5 years from now.

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Suze: Then you refinance for another 30 years. So these 4

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Suze: or 5 years that you have been paying on it,

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Suze: you've just lost all of that. So you think that

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Suze: you're ahead, but the truth of the matter is you're not.

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Suze: So rule number one, if you ever do refinance.

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Suze: You have to make sure you don't have the mortgage

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Suze: term longer than the current amount of years left on

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Suze: your mortgage. So if you have only 26 years left

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Suze: on your mortgage that you're refinancing, then refinance your new

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Suze: house for 25 years, all right, not another 30, something

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Suze: like that. That's number one, number 2.

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Suze: It's hard for me to answer the question because I

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Suze: don't know if you're going to have points involved, not

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Suze: points involved, what the closing costs are going to be.

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Suze: So the way that you would figure this out is

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Suze: what is it going to cost you to totally refinance

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Suze: this house.

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Suze: And what will your current mortgage payments be? And what

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Suze: will the savings be if you were to do that

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Suze: between your new mortgage rate and your old?

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Suze: Then you divide that number, the difference into the cost

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Suze: of refinancing.

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Suze: And then you'll know how long it's gonna take you

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Suze: to make up for that figure. If it's going to

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Suze: be 5, 6, 7 years and you don't think you're

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Suze: going to be in the house that long, then it

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Suze: makes absolutely no sense to do it. If it's gonna

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Suze: be like 2 years and you know you're gonna be

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Suze: in the house that long or longer, then you refinance.

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Suze: So that is how I would answer that question. In fact,

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Suze: that's how I did answer it. All right, next, KT.

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KT: Next is from Pamela, and it's not a question but

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KT: it's something I want. It's a lesson and Suze, you

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KT: taught her this lesson ready.

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KT: Hi KT and Suze.

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Suze: Have I

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Suze: taught you any lessons?

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KT: Me? Oh my God, we don't have enough time and

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KT: podcast for the rest of our life for me to

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KT: answer that.

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Suze: Because people sure like my Roth IRA podcast.

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KT: I don't want to talk about March 6th.

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Suze: All right, fine, no problem.

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KT: So I left your Suze school on March 6th.

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Suze: Oh, that's

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Suze: fascinating because I'm sitting here thinking about how did KT

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Suze: even know that the Roth IRA quiz was on March 6th.

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Suze: I went, did she listen to it?

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KT: I listen to that over and

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Suze: over. Honest to God, everybody, I had no idea she

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Suze: was just gonna say what she was because I don't

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Suze: know these questions

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Suze: she's reading.

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KT: I loved your Suze school on March 6th. I only

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KT: got one question wrong, so I was like showing off Pamela.

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KT: Pamela got one question wrong. KT got like 50% wrong.

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KT: Now she said, I also want to..

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Suze: KT, behonest, you got, you got...

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KT: I got like 70% wrong.

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Suze: Yeah, you got 3 right out of 18.

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KT: That's not true.

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Suze: It is true.

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KT: It is not. Don't listen

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KT: to

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KT: her. I also wanted you to know that when I

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KT: was getting my taxes done a month ago, the CPA

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KT: told me I couldn't withdraw from my contributions in my

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KT: Roth

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KT: IRA without a penalty. I've had my Roth IRA for

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KT: 10 years. I will be 58 in June. I told

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KT: him that is not true. I didn't want him doing

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KT: my taxes, Suze, so I walked out the door.

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KT: She left. I'm so proud of her. She said, I

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KT: can't even take credit. I learned this all from you.

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KT: I want to help my 28 year old son and

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KT: 31 year old daughter with everything I've learned from you.

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KT: Thank you so very much, Pamela. Is that great? She

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KT: had the courage, everyone, to get up and walk

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KT: out he was so wrong.

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Suze: And

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Suze: the lesson from that is just because somebody is in

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Suze: a suit sitting behind a desk with some plaque that

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Suze: says they're this or that doesn't mean they know what

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Suze: they are talking about. Just a quick story, KT. I

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Suze: did a PBS special, the very first one ever.

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Suze: And that is when I said and introduced Roth IRAs

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Suze: for the very first time and told everybody that they

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Suze: could take out their original contributions any time they want

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Suze: without taxes or penalties regardless of age or how long

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Suze: it's been in there.

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Suze: All these people after it aired wrote in to PBS

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Suze: and said that's absolutely wrong. You have to take that

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Suze: off the air, blah blah blah blah. Ha, I was right.

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Suze: They were wrong. Just because they have a few initials

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Suze: after their name

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Suze: doesn't mean squat.

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KT: The, the point of that whole experience is that you've

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KT: got to really know and you can't just trust one...

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Suze: You have to check, double check, be clear, be crystal

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Suze: clear and no and no, and hey, if you didn't

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Suze: believe him or her, go to another one and see

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Suze: if they agree, but it's written everywhere.

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Suze: So he's just whatever. Ok, go on.

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KT: OK, this is from,

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Suze: Wait, aren't you proud of me? I didn't call him

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Suze: what I was going to say, he asked.

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KT: Yes, thank you, especially with that nasally nose of yours.

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KT: The next is from...

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Suze: Do I snore with it?

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KT: No.

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Suze: Oh, that's good to know. OK, go on.

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KT: All right. The next question is from Deb Johnny. Don't

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KT: you love that name? Deb Johnny?

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Suze: Do you think her mom's name is Deb?

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Suze: And her daddy's name is Johnny, and they named her

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Suze: Deb Johnny.

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KT: Maybe I just think it's a pretty name. She said, Hi, Suze,

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KT: I hope this is a quick one. I'm in my mid-50s.

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KT: I've recently retired. I have about $3 million in assets.

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KT: I'm single with no dependents. I have $650,000 in my 401k.

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KT: Of which 500,000 is traditional, the rest is Roth. What

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KT: do you think about using my traditional 401k balance to

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KT: purchase a single premium immediate lifetime annuity to get some

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KT: predictable income before I become eligible for Social Security? She's

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KT: planning on taking that at 70.

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KT: I'll get about 2.8k per month, which will cover more

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KT: than 50% of my monthly expenses. She's doing this, Suze,

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KT: because she said that way she can let her brokerage

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KT: account grow without starting to draw down too much. So I,

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KT: you know, what do you think

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KT: about that?

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Suze: I think it's a really, really bad idea.

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KT: Why?

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Suze: And the reason is this, Deb, Johnny.

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Suze: Right now you're in your mid-fifties and KT just said

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Suze: you want to do this cause $2.8k a month is

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Suze: going to pay for 50% of your expenses. That's your

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Suze: expenses today, girlfriend. That 2.8 is not going to change

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Suze: for the rest of your life. So what do you

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Suze: think it's going to be worth 20 or 30 years

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Suze: from now? What do you think your expenses are going

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Suze: to be 20 or 30 years from now?

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Suze: You need to keep up with inflation and you need growth.

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Suze: At this age, you do not need more income because

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Suze: you already have $3 million in assets.

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Suze: So the goal here is number one to protect your assets,

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Suze: but keep up with the income for when you really

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Suze: need it that you have it invested in something that grows

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Suze: dividend paying stocks if I were you. But no, I

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Suze: would not be taking it now for my 401k. I

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Suze: think it would be the biggest mistake you could ever make.

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Suze: If you told me you were 69 and you wanted

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Suze: to do it. I'd think about it.

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Suze: But not in the 50s. No, go on, KT.

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KT: OK, next question is from Maria. She said, hi Suze

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KT: and KT. I've listened to your Sunday podcast on questions

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KT: about Roth. This is another March 6th. It was so informative.

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KT: Thank you so much. I want to ask if I

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KT: could use my money in my savings account,

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KT: after tax, to transfer to an IRA and then convert

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KT: it to a Roth through the back door. I already

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KT: max out my Roth 401k at work and I'm not

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KT: qualified to fund my individual Roth because of my income.

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KT: Is this possible?

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Suze: What you should do if you do not already have

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00:13:02,830 --> 00:13:07,940
Suze: an IRA, a SEP IRA, any individual retirement account, forget

234
00:13:07,940 --> 00:13:13,319
Suze: what you have at work. Work Roth 401ks, traditional 401ks, whatever,

235
00:13:13,349 --> 00:13:17,760
Suze: they don't count. But if you do not have any

236
00:13:17,760 --> 00:13:22,140
Suze: additional IRA outside of work.

237
00:13:22,969 --> 00:13:29,439
Suze: Then therefore you can just open up a nondeductible IRA

238
00:13:29,770 --> 00:13:33,169
Suze: and then convert it to a Roth, just that simple

239
00:13:33,169 --> 00:13:36,690
Suze: that's known as a back door Roth, so that you

240
00:13:36,690 --> 00:13:40,210
Suze: can do as long as you don't have another individual

241
00:13:40,210 --> 00:13:42,659
Suze: retirement account of any kind.

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KT: OK, OK. Next is from Jody. I never miss an

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KT: episode of your podcast, and I used to watch Can

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KT: I Afford it as a family.

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KT: Well, we have a little treat. We have a treat

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KT: coming up for YouTube. You just be patient. Well, my

247
00:14:00,320 --> 00:14:03,450
KT: little girl has grown up and she's now 29 years old.

248
00:14:03,530 --> 00:14:04,880
KT: Does that make us feel old?

249
00:14:05,909 --> 00:14:09,090
KT: She wants to set up her first Roth IRA. She

250
00:14:09,090 --> 00:14:14,150
KT: has $40,000 in a high interest savings to use to

251
00:14:14,150 --> 00:14:17,819
KT: fund an IRA. Suze, I don't know how to guide her.

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00:14:18,109 --> 00:14:21,590
KT: Is there a brokerage firm you recommend that doesn't charge

253
00:14:21,590 --> 00:14:26,859
KT: many fees? What should she do? ETFs, mutual funds? Question, question, question.

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00:14:27,559 --> 00:14:29,940
KT: Oh wait, and then there's one more line here. It said,

255
00:14:30,020 --> 00:14:34,429
KT: but like KT, Roth investing and I are like oil

256
00:14:34,429 --> 00:14:37,159
KT: and water. Thanks, Jody.

257
00:14:38,260 --> 00:14:41,140
KT: You and I are from the same, same batch. We're

258
00:14:41,140 --> 00:14:41,700
KT: both a little...

259
00:14:41,700 --> 00:14:46,539
Suze: ...slippery, huh, anyway, um, so all you have to do

260
00:14:46,539 --> 00:14:49,539
Suze: is like go to Schwab, go to Vanguard. Vanguard is

261
00:14:49,539 --> 00:14:55,780
Suze: a fabulous brokerage firm. Vanguard Fidelity or Schwab either one

262
00:14:55,780 --> 00:14:59,780
Suze: doesn't matter, OK? But let's say you did Schwab, go

263
00:14:59,780 --> 00:15:03,619
Suze: and open up a Roth IRA for her fully funded

264
00:15:03,619 --> 00:15:04,380
Suze: to 7000

265
00:15:04,625 --> 00:15:08,784
Suze: dollars put it in their treasury money market fund or

266
00:15:08,784 --> 00:15:12,784
Suze: whatever it may be and then have her dollar cost

267
00:15:12,784 --> 00:15:17,664
Suze: average into these stock markets because obviously the stock market

268
00:15:17,664 --> 00:15:21,215
Suze: is not having a really great time this year so far,

269
00:15:21,385 --> 00:15:25,025
Suze: but it will again. Now if I were you I

270
00:15:25,025 --> 00:15:29,065
Suze: would have her do exchange traded funds, ETFs, so she

271
00:15:29,065 --> 00:15:30,984
Suze: has some diversification.

272
00:15:31,369 --> 00:15:34,309
Suze: So it's really just that simple. So if she puts

273
00:15:34,309 --> 00:15:38,820
Suze: in $7000 at once, then you would have her put

274
00:15:38,820 --> 00:15:44,780
Suze: in approximately $583 a month into either the Standard and

275
00:15:44,780 --> 00:15:48,940
Suze: Poor's 500 index fund, the Vanguard total stock market index fund,

276
00:15:48,979 --> 00:15:52,099
Suze: or just keep it simple for her now to get

277
00:15:52,099 --> 00:15:54,419
Suze: her used to investing in the ups and

278
00:15:54,559 --> 00:15:57,369
Suze: downs of the market. That's what I would be doing

279
00:15:57,369 --> 00:15:58,520
Suze: if I were you. Next, KT.

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00:15:58,549 --> 00:16:02,630
KT: OK, I have a question from Scott. He said, Suze

281
00:16:02,630 --> 00:16:05,789
KT: and KT, thanks for all the advice. I'll be 50

282
00:16:05,789 --> 00:16:09,340
KT: in June. He's a Gemini like you. Gemini Scott.

283
00:16:09,710 --> 00:16:11,500
Suze: Like me, I'm gonna be 74.

284
00:16:12,190 --> 00:16:15,219
KT: All right, Scott, you have a long way to go.

285
00:16:15,750 --> 00:16:16,690
KT: Between your show...

286
00:16:16,950 --> 00:16:19,510
Suze: And may your 24 years till that age be as

287
00:16:19,510 --> 00:16:20,690
Suze: great as mine.

288
00:16:20,830 --> 00:16:26,059
KT: Yes, between your show and conversations with my mom, converting

289
00:16:26,059 --> 00:16:31,789
KT: all of my pre-tax retirement accounts without 401k seems to

290
00:16:31,789 --> 00:16:35,190
KT: be the best course to limit RMDs.

291
00:16:35,820 --> 00:16:40,750
KT: So he said, I have about 6 traditional IRAs with

292
00:16:40,750 --> 00:16:45,590
KT: recent and potential market corrections. Would you recommend converting as

293
00:16:45,590 --> 00:16:48,700
KT: many as possible to Roths this year?

294
00:16:49,390 --> 00:16:55,030
Suze: I would, depending, however, what the tax ramification will be

295
00:16:55,030 --> 00:16:58,450
Suze: to you, because even though the markets are down, that

296
00:16:58,450 --> 00:17:01,059
Suze: doesn't mean that you don't have a lot of money

297
00:17:01,469 --> 00:17:04,189
Suze: still in those positions. So therefore.

298
00:17:04,900 --> 00:17:09,020
Suze: After you have checked with a CPA, then you decide

299
00:17:09,020 --> 00:17:13,020
Suze: which investments that you have make the most sense, like

300
00:17:13,020 --> 00:17:15,500
Suze: which ones do you want to keep that have gone

301
00:17:15,500 --> 00:17:16,910
Suze: down dramatically.

302
00:17:17,380 --> 00:17:21,399
Suze: And then you would convert those, but it's definitely worth

303
00:17:21,400 --> 00:17:24,319
Suze: it to convert while the markets are

304
00:17:24,319 --> 00:17:24,869
Suze: down.

305
00:17:25,040 --> 00:17:26,069
KT: All right, next question.

306
00:17:26,479 --> 00:17:27,160
Suze: Why did you look at me like that?

307
00:17:27,839 --> 00:17:29,109
KT: I didn't know if you were done.

308
00:17:29,400 --> 00:17:30,339
Suze: I wasn't sure I was done.

309
00:17:30,640 --> 00:17:31,839
KT: I know. Are you finished?

310
00:17:32,199 --> 00:17:33,180
Suze: Let me think about it.

311
00:17:33,479 --> 00:17:35,479
KT: Yes, you are, OK, because I have so many good questions.

312
00:17:36,074 --> 00:17:39,435
Suze: But what's key about that is never do it all

313
00:17:39,435 --> 00:17:41,435
Suze: at once unless all you have in there is like

314
00:17:41,435 --> 00:17:44,385
Suze: 3000 $5000. If you have a lot of money in there,

315
00:17:44,675 --> 00:17:48,875
Suze: never convert to a Roth all at once. You'll be

316
00:17:48,875 --> 00:17:51,474
Suze: so sorry that you did, especially if it puts you

317
00:17:51,474 --> 00:17:52,714
Suze: in a really high tax

318
00:17:52,714 --> 00:17:53,114
Suze: bracket.

319
00:17:53,275 --> 00:17:57,555
KT: All right. Next question is from Gay, she said, I'm

320
00:17:57,555 --> 00:18:02,354
KT: a retired New York City teacher with a 457B and

321
00:18:02,354 --> 00:18:04,304
KT: a tax deferred annuity.

322
00:18:04,709 --> 00:18:07,869
KT: They have RMD rules that seem similar to those of

323
00:18:07,869 --> 00:18:12,270
KT: traditional IRAs, and now she's asking, I also have a

324
00:18:12,270 --> 00:18:17,030
KT: relatively small traditional IRA opened at the beginning of time.

325
00:18:18,500 --> 00:18:22,219
KT: Can these three types of accounts be aggregated for the

326
00:18:22,219 --> 00:18:26,329
KT: RMD so I can draw from the least lucrative one?

327
00:18:26,699 --> 00:18:28,780
KT: I don't, I thought that was a good question because

328
00:18:28,780 --> 00:18:30,550
KT: I don't know. OK, can you?

329
00:18:30,859 --> 00:18:31,300
Suze: Are you sure you don't

330
00:18:31,300 --> 00:18:32,489
Suze: know. Is this you're quizzy.

331
00:18:32,599 --> 00:18:34,660
KT: If it's a quizzy, then I'm going to guess you

332
00:18:34,660 --> 00:18:38,459
KT: absolutely cannot aggregate accounts like that.

333
00:18:38,660 --> 00:18:39,739
Suze: And why would you say that?

334
00:18:40,099 --> 00:18:42,300
KT: Because they're, they're all different. They're all different.

335
00:18:43,239 --> 00:18:44,064
Suze: Ding Ding Ding-a

336
00:18:44,064 --> 00:18:44,420
KT: Yeah, I see.

337
00:18:44,564 --> 00:18:45,385
Suze: She got that but

338
00:18:45,385 --> 00:18:46,464
KT: It's a good question,

339
00:18:46,555 --> 00:18:47,313
Suze: Right? People wonder.

340
00:18:47,314 --> 00:18:53,104
Suze: You cannot if you have 15 different IRAs, then you

341
00:18:53,104 --> 00:18:55,994
Suze: aggregate all of them, the total that's in there for

342
00:18:55,994 --> 00:18:59,145
Suze: your RMD, and you can take it from anyone you want.

343
00:18:59,234 --> 00:19:01,234
Suze: It doesn't matter, but you have to do it on

344
00:19:01,234 --> 00:19:02,353
Suze: the total amount.

345
00:19:02,680 --> 00:19:06,899
Suze: But you cannot add into that amount what's in your

346
00:19:06,900 --> 00:19:11,459
Suze: tax deferred annuity or your 450 those are separate and

347
00:19:11,459 --> 00:19:14,339
Suze: have to do their own. What you could do is

348
00:19:14,339 --> 00:19:18,140
Suze: if you're retired and you want, you can roll them

349
00:19:18,140 --> 00:19:20,899
Suze: over like you could roll over possibly your tax deferred

350
00:19:20,900 --> 00:19:25,579
Suze: annuity into your IRA that you've had forever and aggregate

351
00:19:25,579 --> 00:19:26,448
Suze: it there.

352
00:19:26,755 --> 00:19:29,475
Suze: So that you'd only have to figure out one RMD.

353
00:19:29,546 --> 00:19:31,696
Suze: So look into that to see if you can do

354
00:19:31,696 --> 00:19:33,786
Suze: that with your accounts.

355
00:19:33,984 --> 00:19:37,186
KT: So Suze, next question is from Linda. She said, I

356
00:19:37,186 --> 00:19:40,426
KT: am a teacher and will receive a pension. We love teachers,

357
00:19:40,546 --> 00:19:40,895
KT: don't we?

358
00:19:40,906 --> 00:19:41,205
Suze: So much, so much.

359
00:19:41,205 --> 00:19:45,806
KT: They're our favorite people. I'm a teacher, will receive a pension,

360
00:19:45,865 --> 00:19:50,186
KT: but do not have enough Social Security credits to receive

361
00:19:50,186 --> 00:19:50,514
KT: Social

362
00:19:50,871 --> 00:19:56,112
KT: Security myself, my husband will receive Social Security, and I

363
00:19:56,112 --> 00:19:58,620
KT: understand that I will be able to receive his Social

364
00:19:58,621 --> 00:20:03,112
KT: Security benefit if he passes before me. But Suze, what

365
00:20:03,112 --> 00:20:08,671
KT: about spousal benefit while we're both alive? He's 60. I

366
00:20:08,671 --> 00:20:12,722
KT: am 59. We planned to wait until he was 70

367
00:20:12,722 --> 00:20:14,751
KT: to begin collecting his social.

368
00:20:15,180 --> 00:20:19,819
KT: However, will I be eligible for spousal benefits while he

369
00:20:19,819 --> 00:20:24,060
KT: is alive? If so, is there any benefit to having

370
00:20:24,060 --> 00:20:28,449
KT: him start to collect at 67 so we can both

371
00:20:28,449 --> 00:20:31,219
KT: receive benefits earlier, or is it best to still wait

372
00:20:31,219 --> 00:20:33,699
KT: till 70? You got to set her straight, Suze.

373
00:20:33,859 --> 00:20:39,660
Suze: Linda, listen. The biggest mistake that most people make is

374
00:20:39,660 --> 00:20:43,619
Suze: they always think that they are going to get 50%

375
00:20:44,040 --> 00:20:48,280
Suze: of their spouse's social security, no matter what. So if

376
00:20:48,280 --> 00:20:52,079
Suze: their spouse waits till they are 70, let's say, to

377
00:20:52,079 --> 00:20:56,199
Suze: get Social Security, you think you're going to get 50%

378
00:20:56,199 --> 00:20:59,948
Suze: of the amount that your spouse will get at 70,

379
00:20:59,959 --> 00:21:05,400
Suze: and that's not true. You only get 50% of what

380
00:21:05,400 --> 00:21:09,599
Suze: your spouse would have gotten at his or her full

381
00:21:09,599 --> 00:21:13,560
Suze: retirement age, which is currently 67.

382
00:21:14,189 --> 00:21:18,699
Suze: Now, since you aren't going to have any Social Security,

383
00:21:19,290 --> 00:21:23,229
Suze: then what I would advise you to do is this.

384
00:21:23,650 --> 00:21:26,729
Suze: Let's just say that your husband is going to get

385
00:21:26,729 --> 00:21:31,688
Suze: $2000 at the age of 70. Therefore, you're not going

386
00:21:31,689 --> 00:21:37,089
Suze: to get 50% of that $2000. You get 50% of

387
00:21:37,089 --> 00:21:41,050
Suze: what he would get at his full retirement age of 67.

388
00:21:41,599 --> 00:21:44,050
Suze: That means at 67

389
00:21:44,979 --> 00:21:49,770
Suze: he would probably only be getting about $1600 a month,

390
00:21:50,300 --> 00:21:54,139
Suze: which means you would get 50% of that, which is

391
00:21:54,140 --> 00:21:59,579
Suze: about $800 a month. Remember you have to be 67,

392
00:21:59,619 --> 00:22:02,089
Suze: your full retirement age

393
00:22:03,310 --> 00:22:08,469
Suze: to get the full 50% of the spousal benefit. So

394
00:22:08,469 --> 00:22:11,260
Suze: given that you and your husband are just one year apart,

395
00:22:11,430 --> 00:22:14,270
Suze: it's just so great I can't tell you. So this

396
00:22:14,270 --> 00:22:16,390
Suze: is what I would do if I were you.

397
00:22:17,339 --> 00:22:21,579
Suze: Assuming that those numbers were your numbers and you have

398
00:22:21,579 --> 00:22:24,699
Suze: to do this with your own numbers, I would have

399
00:22:24,699 --> 00:22:27,780
Suze: your husband claim at the age of 68.

400
00:22:28,489 --> 00:22:33,260
Suze: And that would be about $1750 a month. I would

401
00:22:33,260 --> 00:22:37,310
Suze: have you claim 50% of the spousal benefit of his

402
00:22:37,310 --> 00:22:38,979
Suze: full retirement age.

403
00:22:40,040 --> 00:22:42,819
Suze: I would have you do that at 67, which would

404
00:22:42,819 --> 00:22:46,819
Suze: give you about $800 a month. So you would get

405
00:22:46,819 --> 00:22:53,140
Suze: approximately $2550 a month starting when he is 68 and

406
00:22:53,140 --> 00:22:57,650
Suze: you are 67. Given that he wasn't going to claim,

407
00:22:57,780 --> 00:23:02,739
Suze: let's just say till 70, that's two years of payments,

408
00:23:03,300 --> 00:23:06,130
Suze: that you wouldn't have been getting neither of you cause

409
00:23:06,130 --> 00:23:10,449
Suze: you have to claim spouse has to claim, Linda, in

410
00:23:10,449 --> 00:23:14,930
Suze: order for you to get a spousal benefit. Therefore, in

411
00:23:14,930 --> 00:23:22,050
Suze: those two years that would be close to $61,000 of

412
00:23:22,050 --> 00:23:25,329
Suze: money that you're entitled to that you wouldn't have claimed.

413
00:23:25,890 --> 00:23:28,969
Suze: I don't know. I think that's a big difference. And

414
00:23:28,969 --> 00:23:32,339
Suze: if I were you, that's what I would go for.

415
00:23:32,489 --> 00:23:33,649
Suze: Did that all make sense to you, KT?

416
00:23:34,130 --> 00:23:38,719
KT: I think that it's smart that they 68 and 67,

417
00:23:38,849 --> 00:23:42,209
KT: go for it. 61,000 is a lot of money in

418
00:23:42,209 --> 00:23:42,640
KT: two years.

419
00:23:42,770 --> 00:23:45,400
Suze: Yeah, and really if you look at the difference between

420
00:23:45,400 --> 00:23:46,050
Suze: what they would have gotten.

421
00:23:46,515 --> 00:23:49,156
Suze: No, it's not worth it in my

422
00:23:49,156 --> 00:23:49,436
Suze: opinion.

423
00:23:49,556 --> 00:23:51,196
KT: They do better off doing what you

424
00:23:51,196 --> 00:23:51,666
KT: just said,

425
00:23:51,676 --> 00:23:54,156
Suze: I think so, but you should always double check. All right,

426
00:23:54,265 --> 00:23:54,745
Suze: next question, KT.

427
00:23:54,955 --> 00:23:59,836
KT: Suze, my final question from Sheila. Hi, Suze, thank you

428
00:23:59,836 --> 00:24:03,595
KT: for the Roth info. I'm a little confused because I

429
00:24:03,595 --> 00:24:06,395
KT: heard you say that if you have pre-tax

430
00:24:06,552 --> 00:24:11,932
KT: money in any retirement account, then don't do a backdoor Roth,

431
00:24:12,182 --> 00:24:16,661
KT: but we have 401ks and 403Bs. So does that mean

432
00:24:16,661 --> 00:24:20,291
KT: we shouldn't do a backdoor Roth or were you just

433
00:24:20,291 --> 00:24:23,411
KT: referring to IRAs with tax money?

434
00:24:23,501 --> 00:24:27,621
Suze: Now, I already answered that on this podcast, KT. What's

435
00:24:27,621 --> 00:24:28,302
Suze: the answer?

436
00:24:30,489 --> 00:24:31,880
Suze: Don't look at me like that.

437
00:24:32,839 --> 00:24:33,319
KT: No.

438
00:24:34,709 --> 00:24:36,699
Suze: So the answer is what?

439
00:24:36,939 --> 00:24:38,260
KT: The answer is that

440
00:24:38,260 --> 00:24:38,420
Suze: are

441
00:24:38,420 --> 00:24:38,579
KT: you

442
00:24:38,579 --> 00:24:38,780
Suze: were

443
00:24:38,780 --> 00:24:41,540
Suze: you just referring to IRAs?

444
00:24:41,699 --> 00:24:45,780
KT: So, so she has 401ks and 403Bs. Were you just

445
00:24:45,780 --> 00:24:50,859
KT: referring to IRAs? Yes, you were. You were referring only

446
00:24:50,859 --> 00:24:51,699
KT: to IRAs.

447
00:24:51,739 --> 00:24:54,629
Suze: That's right. Good. So it wasn't. No, it was, yes, ding ding.

448
00:24:54,630 --> 00:24:56,709
KT: I meant no, she can't do the other two.

449
00:24:56,709 --> 00:25:00,260
Suze: Yeah, no, it's don't worry, any money you have an

450
00:25:00,260 --> 00:25:01,890
Suze: employer sponsored plan.

451
00:25:02,250 --> 00:25:04,910
Suze: I don't care what kind of money it is in there,

452
00:25:05,280 --> 00:25:09,680
Suze: then that doesn't count for the pro rata backdoor IRA.

453
00:25:09,689 --> 00:25:17,160
Suze: It's only traditional IRAs, IRAs, SEP IRAs, simple IRAs, anything

454
00:25:17,160 --> 00:25:20,680
Suze: that's an individual retirement account.

455
00:25:21,290 --> 00:25:22,750
Suze: Alright, KT, I did it.

456
00:25:23,349 --> 00:25:25,750
KT: You did it, Suze. That's a wrap, and everyone, I want

457
00:25:25,750 --> 00:25:28,339
KT: you to just remember three things.

458
00:25:28,859 --> 00:25:29,109
Suze: What are they?

459
00:25:29,109 --> 00:25:33,189
KT: People first, God, then money, then things.

460
00:25:33,189 --> 00:25:39,379
Suze: And if you do that, stay safe, stay strong, stay healthy. Oh,

461
00:25:39,469 --> 00:25:43,329
Suze: then together we really will rise. bye bye.