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Suze: February 27, 2025. Welcome everybody to the Women and Money podcast,

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Suze: as well as everybody smart enough to listen.

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Suze: Today is what KT?

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KT: February 27th.

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Suze: Don't be smart. Don't be...

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KT: February 27th...

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Suze: this is the Ask KT and Suze, Anything

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KT: I'll do anything for you, dear. OK, let's go.

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Suze: No wait.

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Suze: If you want, write into ask Suze SUZE podcast at gmail.com.

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Suze: And if you have a question, that is, it comes

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Suze: to us right here. KT looks through them, and if

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Suze: you're lucky, she chooses it, and we answer it here

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Suze: on the podcast. Now you have to listen to the

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Suze: podcast to know if we've answered your question. Somebody wrote

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Suze: the other day and said, Suze, I've been waiting. I

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Suze: wanted to hear back from you. My question was never answered.

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Suze: I went...

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KT: Wait, I got another one today that said.

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KT: Please give me a heads up when you're answering my

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KT: questions so I can listen. I'm thinking I'm not gonna

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KT: do that. Now you have to listen to everyone. I'm

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KT: not gonna give you, give you a heads up warning,

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KT: you know, emergency ding ding bell.

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Suze: Early this morning I was looking at KT. I said,

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Suze: What are you doing? She goes, I'm looking through to

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Suze: just make sure I have the most interesting ones. So

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Suze: let's see, let's see if you do, little one.

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KT: All right, so here we go. This is from Irene. Hello,

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KT: Suze and KT. I was

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KT: listening to your podcast and decided to review my retirement portfolio,

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KT: which I inherited from my husband 10 years ago. At

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KT: that time, I was led to an investor by my

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KT: husband's cousin a few months

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KT: ago,

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Suze: danger, danger. I can already tell you...

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KT: wait a few months after my husband passed, as I

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KT: review my portfolio, there was a $240,000 in an IRA today,

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Suze: So 10 years ago, she deposited

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Suze: $240,000 and how much is it worth today?

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KT: Ready? The same account balance has grown to $266,283 in

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KT: 10 years. So this is the question she's asking. Is

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KT: this a normal growth rate? It seems so low for

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KT: 10 years. I was told my account is set up

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KT: as a moderate growth, more on the preservation side. So

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KT: that's her question. Is it normal?

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Suze: What do you think, KT?

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KT: Sounds pretty low to me for 10 years?

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Suze: So you'd be upset at that?

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Suze: Very upset considering what the stock market's been doing in

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Suze: the past 10 years.

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Suze: All right, so my dear Irene,

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KT: what do you think?

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Suze: If you put 240 in 10 years ago and today

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Suze: it's worth 266 or essentially 26,000.

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Suze: Over 10 years, it's about a 1% annual average rate

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Suze: of return.

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KT: It's pretty low.

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Suze: Pretty low? That's horrific. Truthfully, number one, even if you

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Suze: are in a preservation mode just to preserve it.

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Suze: I'm telling you that makes no sense whatsoever. Even if

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Suze: this person had taken your money and put $120,000 in

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Suze: and half of it and locked it up for 3%

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Suze: for all those years and the other and invested it, right,

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Suze: to kind of preserve it and protect against inflation and

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Suze: over all those years you only made 7%, let's just

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Suze: say you'd have $397,000 today.

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Suze: So no matter how you look at it, you know,

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Suze: because the truth is everybody over the past 10 years,

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Suze: the Standard and Poor's 500 index has averaged 12%. So

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Suze: when I say an annual average rate of return, one

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Suze: year it might go up 10%, the other year it

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Suze: might go down 20%, but over all those 10 years,

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Suze: the average annual rate of return comes out to be

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Suze: about 12%.

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Suze: So if he had just put it in a Standard

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Suze: and Poor's 500 index, I hate to tell you, you'd

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Suze: have $745,000 at just a straight 6%, which is pretty moderate,

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Suze: you'd have $429,000. So any way you want to look

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Suze: at it.

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Suze: At 1% is all he's made for you.

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Suze: It's not somebody that you want to stick with. Now,

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Suze: at least you made a little money. It's not like

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Suze: you lost any money. However, if I were you, I

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Suze: would think about taking this money away from him. Obviously

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Suze: it's in an IRA because you inherited it. I'm now

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Suze: looking at your email and it says it was in

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Suze: an IRA. I would do an IRA transfer to another firm.

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Suze: Cause you could just very easily take all of this

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Suze: money and put it in a certificate of deposit or

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Suze: a treasury and average 4.5 or so for probably the

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Suze: rest of your life, so.

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Suze: That's what I would be doing if I were you.

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Suze: I'm so, so sorry. Oh, look at her thing. It

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Suze: says my retirement portfolio. This is the subject area. My

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Suze: retirement portfolio seems suspiciously wrong.

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KT: That's why I picked it, the word suspiciously.

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Suze: You know, I would go back and I would ask

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Suze: this person what kind of fee was he taking for

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Suze: all those 10 years on this money.

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Suze: I will bet you any amount of money. He made

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Suze: as much money as you did in fees. All right,

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Suze: just saying, cause even if he made 1% a year, KT,

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Suze: he made the exact same amount of money as she did.

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KT: Beware

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KT: of cousin's recommendations.

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Suze: It's kind of true, everybody.

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KT: Yeah, sometimes it's better not to work with family.

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Suze: And what have I told you all? You are not to

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Suze: do anything other than keep your money safe and sound

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Suze: for 1 or 2 years, possibly 3, after suffering the

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Suze: loss of a loved one. All right.

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KT: So Suze, this next question is from Nanji. She said,

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KT: I absolutely love you both and only wish I had

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KT: known you years ago. I'm 72. I

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KT: a $200,000 traditional IRA.

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Suze: I wish

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Suze: I had known you

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Suze: years ago.

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KT: As well as a tiny $20,000 Roth. So at the

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KT: end of the day, what Nanji's asking is her Social

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KT: Security and pensions more than cover all of her living expenses.

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KT: She also has a five year emergency fund and CDs

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KT: at Alliant.

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KT: So she doesn't need these IRAs. In my case, does

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KT: it make more sense to continue to convert as much

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KT: as I can afford for the next few years? If

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KT: I choose to make a qualified charitable contribution with my

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KT: first and possibly second RMD.

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KT: So there will be no taxes associated with them. Could

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KT: I continue to convert for these few years as well?

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Suze: OK,

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Suze: now, Nanji, so.

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Suze: First of all, you're old enough, you have to be

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Suze: 70 and a half or older to do qualified charitable distributions,

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Suze: and basically what that is, everybody, is if you have

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Suze: a retirement account like an IRA that you've never paid

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Suze: taxes on or a 401k, whatever it may be, you

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Suze: can contribute up to $108,000 in 2025 anyway, it was

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Suze: a little lower for 2024.

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Suze: But you can do so directly from your IRA to

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Suze: a charity, and that will count against your RMDs. Now, obviously, Nanji,

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Suze: if you have only $200,000 in your IRA, your RMD,

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Suze: your required minimum distribution is only going to be about $7500.

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Suze: So the most you're going to be able to do

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Suze: in a QCD that counts against your RMD will be $7500.

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Suze: After you have done that.

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Suze: Then if you want you can convert, but remember whether

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Suze: you take RMDs or you give them away through a

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Suze: QCD you have to do that before you can convert.

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Suze: So if I were you, given that you're only 72

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Suze: years of age right now.

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Suze: And you don't have to start taking RMDs until 73.

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Suze: I would be converting as much as you possibly can

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Suze: this year right now before you have to take RMDs.

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Suze: I would do so because you're not really in that

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Suze: high of a tax bracket, so you should see a

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Suze: CPA and decide

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Suze: how much money can you convert this year right now

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Suze: into a Roth IRA without really screwing up your taxes,

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Suze: all right? That's number one. Number two, absolutely next year

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Suze: after you do a QCD.

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Suze: Then absolutely I would be converting. I would continue to

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Suze: convert little by little to a Roth given you do

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Suze: not need it. The more you get to convert, the

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Suze: less your RMDs are going to be as well. All right.

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KT: Suze, next question I have is from James.

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KT: Suze, I saw you on a PBS special and have

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KT: been listening ever since. I'm 58 and currently have an

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KT: HSA with $80,000 saved that I do not use. I

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KT: pay for my current qualified medical expenses out of pocket

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KT: with the hope of letting the HSA investment grow. My

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KT: understanding is that at age 65 and beyond I can

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KT: withdraw money from the HSA tax-free.

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KT: So long as the money is to be used to

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KT: reimburse a medical expense, and the question is...

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Suze: A qualified medical expense.

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Suze: All right,

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Suze: OK, I'm just making sure.

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KT: So, well, James's question is this If I save all

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KT: the receipts from my medical expenses over the next 7 years,

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KT: could I submit them for reimbursement all at once? Or

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KT: in other words, do the expenses expire?

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Suze: So now, KT pop quizzy.

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Suze: Pop quizzy here and the reason I'm giving KT a

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Suze: pop quizzy here is I spent years educating so many

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Suze: people on how HSAs work.

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KT: She was the queen of HSAa.

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Suze: I really was.

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KT: Really, the queen was great.

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Suze: Right? But KT went to seminar after seminar after seminar

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Suze: that I gave on this for the Gulfstream Corporation. Therefore,

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Suze: Pop quizzy if James has saved all his receipts from

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Suze: his medical expenses over, let's say the next 7 years

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Suze: if he saves them, can he submit them for reimbursement

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Suze: all at once at age 65?

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Suze: Can he?

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KT: I believe yes, he can.

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Suze: Ding ding ding ding. Yes. He doesn't have to wait

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Suze: till age 65, just so you know. He can do

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Suze: it any time he wants. So James, you know 65

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Suze: has absolutely nothing to do with,

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Suze: whether that's tax free or not, any qualified medical expense

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Suze: for an HSA can be paid out tax free from

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Suze: your account. You don't have to worry about that, but

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Suze: after the age of 65, just so you know, if

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Suze: you withdraw money for a non-qualified medical expense, you're only

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Suze: going to have to pay ordinary income tax on it

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Suze: before the age of 65, it's ordinary income tax and

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Suze: a 20% penalty, but an HSA at any time.

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Suze: Is tax-free for a qualified medical expense. No matter what

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Suze: your age, you can save all of your receipts. They

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Suze: call it the shoebox technique.

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KT: I remember that

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Suze: and you keep all your receipts in a shoebox.

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Suze: You've paid for all of these things. You've let your

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Suze: money grow tax free in an HSA. Then you submit

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Suze: it to the company regardless of age, and they will

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Suze: pay you your expenses never expire. Next.

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KT: I loved that program you did.

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Suze: For Gulfstream...

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KT: Wasn't it great? She went all across America...

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Suze: With the president of Gulfstream. Yeah.

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KT: It was great and people learned so much.

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KT: And, and I think you really liked the HSA program.

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Suze: I liked

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Suze: their HSA program tremendously.

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KT: It was a big benefit.

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KT: Ok, from Maria. Hi, Suze and KT. I listen to

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KT: your podcast and I used to watch the TV show

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KT: back in the day. I value your wisdom and advice.

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KT: I'm a recent 50-year-old widow who retired very early and

233
00:14:01,330 --> 00:14:03,849
KT: moved from the US to a foreign country.

234
00:14:04,159 --> 00:14:07,929
KT: I'm receiving some income from the interest on bank CDs,

235
00:14:07,940 --> 00:14:11,789
KT: but otherwise am frugally living off my savings till I

236
00:14:11,789 --> 00:14:15,510
KT: can start a business. I realize I may be losing

237
00:14:15,510 --> 00:14:21,469
KT: out on the full standard tax deduction of $14,600 because

238
00:14:21,469 --> 00:14:26,469
KT: the interest I'm earning may only reach $4000 this year.

239
00:14:26,710 --> 00:14:29,390
KT: Would this be a wise time to convert some of

240
00:14:29,390 --> 00:14:33,179
KT: my IRA over to the Roth IRA instead?

241
00:14:33,849 --> 00:14:40,530
Suze: Actually it would, so I think in 2025, Maria, that

242
00:14:40,530 --> 00:14:45,169
Suze: the standard deduction may go up to about $15,200. They

243
00:14:45,169 --> 00:14:49,049
Suze: have not decided yet, but if you were to do

244
00:14:49,049 --> 00:14:54,090
Suze: that and because you only have $4000 this year of

245
00:14:54,090 --> 00:14:57,239
Suze: interest coming in and that's really your only income and everything,

246
00:14:57,450 --> 00:15:01,409
Suze: if I were you, I would so convert whatever money

247
00:15:01,409 --> 00:15:02,250
Suze: you want.

248
00:15:02,530 --> 00:15:05,789
Suze: In order to take advantage of the full standard deduction

249
00:15:05,789 --> 00:15:08,469
Suze: and also if you don't mind paying

250
00:15:09,059 --> 00:15:12,859
Suze: like 10% or so on the tax, you could actually

251
00:15:12,859 --> 00:15:17,140
Suze: convert more. You could probably do another $4000 just so

252
00:15:17,140 --> 00:15:20,609
Suze: you know, talk to your CPA about that. Yes.

253
00:15:20,780 --> 00:15:21,729
KT: OK, next question.

254
00:15:21,739 --> 00:15:24,619
Suze: You're a little smart cookie. Maria's a smart cookie.

255
00:15:25,020 --> 00:15:30,640
KT: She, she retired at 50. I wonder what country she's in. Maria,

256
00:15:30,880 --> 00:15:34,809
KT: I just met a girl named Suzi.

257
00:15:35,000 --> 00:15:35,159
Suze: All right.

258
00:15:37,010 --> 00:15:39,969
KT: Hi Suze and KT Suze, you like when I sing,

259
00:15:40,020 --> 00:15:40,679
KT: don't you?

260
00:15:40,780 --> 00:15:43,000
Suze: Truthfully, I do a lot. Yeah.

261
00:15:43,219 --> 00:15:43,659
KT: Hi, Suze,

262
00:15:43,859 --> 00:15:44,460
Suze: You know what I like more?

263
00:15:45,580 --> 00:15:47,359
Suze: I like when we dance in the kitchen.

264
00:15:47,530 --> 00:15:50,119
KT: Oh my goodness. Every now and then when I'm cooking,

265
00:15:50,570 --> 00:15:53,130
KT: I put on little music when I'm cooking, and if

266
00:15:53,130 --> 00:15:54,969
KT: a song comes on that I love, I turn it

267
00:15:54,969 --> 00:15:58,440
KT: up so loud and Suze, wherever she is, comes running

268
00:15:58,440 --> 00:16:00,630
KT: because it means KT wants to dance.

269
00:16:01,979 --> 00:16:05,750
KT: This next question from Lilian. Hi, Suze and KT. Suze

270
00:16:05,750 --> 00:16:09,500
KT: Fan here. I have two questions on POD, which is

271
00:16:09,500 --> 00:16:14,619
KT: pay on death accounts, everyone, and life insurance beneficiaries. What

272
00:16:14,619 --> 00:16:18,500
KT: happens if the person named as the paid on death

273
00:16:18,500 --> 00:16:20,500
KT: also dies, for example.

274
00:16:20,880 --> 00:16:24,210
KT: If I own a CD and the pay on death

275
00:16:24,210 --> 00:16:27,700
KT: is my son, if both of us happen to pass

276
00:16:27,700 --> 00:16:31,690
KT: away in an accident, what happens then? Wait, let me finish.

277
00:16:31,719 --> 00:16:34,539
KT: And then she said, if I have a term life

278
00:16:34,539 --> 00:16:41,489
KT: insurance policy for $100,000 and my beneficiaries are my son 50%,

279
00:16:41,580 --> 00:16:43,460
KT: my cousin 50%.

280
00:16:43,690 --> 00:16:48,679
KT: And a contingent beneficiary, my brother at 100. If my

281
00:16:48,679 --> 00:16:51,880
KT: son and I pass in an accident, how is the

282
00:16:51,880 --> 00:16:54,479
KT: life insurance payment calculated?

283
00:16:54,719 --> 00:16:55,580
Suze: Should that be a quizzy too?

284
00:16:55,580 --> 00:16:58,869
KT: No, I mean, that's pretty straightforward.

285
00:16:59,119 --> 00:16:59,679
Suze: Oh, it is,

286
00:16:59,710 --> 00:17:02,510
Suze: is it? So in the first case, what do you

287
00:17:02,510 --> 00:17:02,739
Suze: think happens?

288
00:17:02,940 --> 00:17:04,599
KT: Oh wait, let me just remind myself in the first case...

289
00:17:04,599 --> 00:17:09,839
Suze: She has a CD that it's a pay on death

290
00:17:09,839 --> 00:17:11,079
Suze: account to her son.

291
00:17:11,540 --> 00:17:12,650
KT: But if they both die...

292
00:17:12,650 --> 00:17:13,930
Suze: What happens?

293
00:17:14,130 --> 00:17:16,170
KT: It goes to the contingent...

294
00:17:16,489 --> 00:17:19,930
Suze: There is no contingent beneficiary. That's the life insurance policy

295
00:17:19,930 --> 00:17:20,920
Suze: she's talking about.

296
00:17:21,609 --> 00:17:22,400
KT: Oh, I don't know.

297
00:17:22,569 --> 00:17:23,829
Suze: That's my girl.

298
00:17:25,640 --> 00:17:28,189
KT: I don't know, but that is a really important...

299
00:17:28,390 --> 00:17:32,280
Suze: Thing to know. So first of all, you all have

300
00:17:32,280 --> 00:17:35,040
Suze: to know when you do a pay on death account.

301
00:17:35,540 --> 00:17:38,968
Suze: There's very seldom will a bank allow you to do

302
00:17:38,969 --> 00:17:42,489
Suze: an alternate, meaning something happens to your son, then you

303
00:17:42,489 --> 00:17:45,050
Suze: get to name an alternate. That's not how pay on

304
00:17:45,050 --> 00:17:48,930
Suze: death accounts normally work, just so you know. So in

305
00:17:48,930 --> 00:17:52,750
Suze: your case where both you and your son pass away

306
00:17:52,750 --> 00:17:57,119
Suze: in an accident, the money that is in that CD

307
00:17:57,650 --> 00:18:01,619
Suze: will be governed by your estate, your will.

308
00:18:02,079 --> 00:18:05,310
Suze: And if you don't have a will, it will go

309
00:18:05,310 --> 00:18:10,379
Suze: into intestate succession. Every one of you has to understand

310
00:18:10,380 --> 00:18:13,540
Suze: if you have not taken the time to do a

311
00:18:13,540 --> 00:18:15,708
Suze: will on your own. You don't have a trust. You

312
00:18:15,709 --> 00:18:17,550
Suze: don't have anything, and you die.

313
00:18:18,050 --> 00:18:21,000
Suze: Oh, the state that you live in. Oh, they've already

314
00:18:21,000 --> 00:18:26,569
Suze: written one for you. It's called intestate succession, and every

315
00:18:26,569 --> 00:18:30,569
Suze: state has decided if you die without a will, your

316
00:18:30,569 --> 00:18:33,659
Suze: money first goes to maybe your parents, maybe your spouse.

317
00:18:34,050 --> 00:18:38,089
Suze: Maybe your children. Maybe it's divided between all three. You

318
00:18:38,089 --> 00:18:40,448
Suze: better check it out, or better yet, you should get

319
00:18:40,449 --> 00:18:43,839
Suze: a trust in a will, but that's besides the point.

320
00:18:44,089 --> 00:18:47,770
Suze: So that's number one. Second, if you have a term

321
00:18:47,770 --> 00:18:53,129
Suze: life insurance policy where your son is 50% and your

322
00:18:53,130 --> 00:18:57,290
Suze: cousin is 50% and you both die.

323
00:18:57,859 --> 00:19:01,180
Suze: Now what's going to happen is you have a contingent beneficiary,

324
00:19:01,260 --> 00:19:07,579
Suze: your brother, who's to get 100%. The contingent beneficiary will

325
00:19:07,579 --> 00:19:14,129
Suze: be getting your son's 50%. Your cousin will remain at 50%,

326
00:19:14,180 --> 00:19:17,938
Suze: and that is how it is. So that's how it

327
00:19:17,939 --> 00:19:19,589
Suze: would work. Next question, KT.

328
00:19:19,780 --> 00:19:20,420
KT: All right, this is.

329
00:19:20,645 --> 00:19:23,964
KT: Darlene, she said, Suze, can you explain the difference in

330
00:19:23,964 --> 00:19:27,915
KT: a trust versus a ladybird deed? I live in North Carolina.

331
00:19:28,204 --> 00:19:31,604
KT: My only real asset is my home. We would like

332
00:19:31,604 --> 00:19:34,135
KT: to make it easy when we pass for our home

333
00:19:34,135 --> 00:19:35,464
KT: to go to our son.

334
00:19:35,564 --> 00:19:41,083
Suze: Yeah, so here's the thing, Darlene, you bet a ladybird deed.

335
00:19:41,564 --> 00:19:46,004
Suze: Will make it absolutely easy for you to transfer your

336
00:19:46,005 --> 00:19:47,484
Suze: home to your son.

337
00:19:48,010 --> 00:19:52,339
Suze: The thing is with a ladybird deed, the only thing

338
00:19:52,339 --> 00:19:58,170
Suze: that you could pass that way is real estate. That's it.

339
00:19:58,420 --> 00:20:03,339
Suze: Obviously it's simple, doesn't cost a lot. It will obviously, KT,

340
00:20:03,339 --> 00:20:04,339
Suze: avoid probate.

341
00:20:04,810 --> 00:20:10,989
Suze: The disadvantages, however, is it only involves real estate. You

342
00:20:10,989 --> 00:20:13,550
Suze: have no, just like I said a little bit ago, KT,

343
00:20:13,630 --> 00:20:16,030
Suze: that the bank when it's a pay on death account,

344
00:20:16,109 --> 00:20:20,629
Suze: they normally don't have alternatives if something happens. The same

345
00:20:20,630 --> 00:20:23,310
Suze: is true with a ladybird deed.

346
00:20:23,630 --> 00:20:28,920
Suze: They offer absolutely no flexibility for alternate beneficiaries. So if

347
00:20:28,920 --> 00:20:33,040
Suze: her son dies before her, all right, now what are

348
00:20:33,040 --> 00:20:36,719
Suze: we going to do? Also, they have the ability to

349
00:20:36,719 --> 00:20:41,719
Suze: complicate title insurance and future transaction, things like that. I

350
00:20:41,719 --> 00:20:43,479
Suze: will forever tell you.

351
00:20:44,079 --> 00:20:48,310
Suze: Especially because you can get the must-have documents, a will,

352
00:20:48,520 --> 00:20:51,560
Suze: a living revocable trust, an advanced directive and durable power

353
00:20:51,560 --> 00:20:54,479
Suze: of attorney for healthcare, as well as a financial power

354
00:20:54,479 --> 00:20:55,280
Suze: of attorney.

355
00:20:55,709 --> 00:20:59,609
Suze: And you can get it by going to musthadocs.com. You

356
00:20:59,609 --> 00:21:02,329
Suze: get them through Hay House, who has manufactured these, and

357
00:21:02,329 --> 00:21:07,530
Suze: it's providing them for you, everybody. However, you are far

358
00:21:07,530 --> 00:21:10,849
Suze: better off for the $99 they're going to charge you,

359
00:21:10,890 --> 00:21:16,170
Suze: which is probably less than a ladybird deed, truthfully, that if

360
00:21:16,170 --> 00:21:18,448
Suze: you put the house in trust.

361
00:21:18,949 --> 00:21:22,140
Suze: It's held for your benefit during your lifetime, but upon

362
00:21:22,140 --> 00:21:26,890
Suze: death it transfers to your son. Or if something happens

363
00:21:26,890 --> 00:21:29,369
Suze: to you and your son like that other woman was

364
00:21:29,369 --> 00:21:35,810
Suze: just asking, then your trust provides for alternate beneficiaries. Also,

365
00:21:35,939 --> 00:21:40,180
Suze: you can include many other things as well, and you

366
00:21:40,180 --> 00:21:43,150
Suze: can also make it easier for your son if you

367
00:21:43,150 --> 00:21:45,699
Suze: have an advanced directive and durable power of attorney for

368
00:21:45,699 --> 00:21:48,458
Suze: health care and all of those things, so.

369
00:21:49,180 --> 00:21:55,189
Suze: Either one OK, but given that they don't allow you

370
00:21:55,189 --> 00:21:58,489
Suze: to have an alternate with a ladybird, I most certainly

371
00:21:58,489 --> 00:22:02,899
Suze: would be doing a living revocable trust instead, you know, KT,

372
00:22:03,729 --> 00:22:08,130
Suze: people never think that somebody's going to die before them.

373
00:22:08,619 --> 00:22:11,969
Suze: Ever. KT, have I already told the story about the woman?

374
00:22:12,699 --> 00:22:17,359
KT: You did. Yeah, that sadly left her home to her niece

375
00:22:17,359 --> 00:22:18,420
Suze: And her niece died before she did.

376
00:22:18,420 --> 00:22:21,170
KT: And then she couldn't even live in her own home.

377
00:22:21,420 --> 00:22:24,030
Suze: Well, she's living there, but she doesn't own her home anymore.

378
00:22:24,219 --> 00:22:26,819
Suze: She can't sell it. I don't know if I've told

379
00:22:26,819 --> 00:22:27,060
Suze: you that

380
00:22:27,204 --> 00:22:31,515
Suze: tory or not, but it's horrific. Be careful, everybody. All right,

381
00:22:31,714 --> 00:22:32,234
Suze: go on.

382
00:22:32,474 --> 00:22:37,155
KT: OK, from Lynn, hello, the very kind KT and the

383
00:22:37,155 --> 00:22:38,984
KT: financial sage Suze.

384
00:22:39,114 --> 00:22:41,234
Suze: Why does everybody think you're so much kinder?

385
00:22:41,354 --> 00:22:44,724
KT: I am. I'm very kind, not kinder

386
00:22:44,724 --> 00:22:44,733
Suze: Tell them about my soft side.

387
00:22:44,733 --> 00:22:44,734
KT: No.

388
00:22:47,439 --> 00:22:48,109
Suze: What do you mean no?

389
00:22:48,430 --> 00:22:49,500
KT: I'm not going to tell them

390
00:22:49,770 --> 00:22:50,060
Suze: Why?

391
00:22:50,310 --> 00:22:54,020
KT: Because that's like, you know, revealing the Wizard of Oz.

392
00:22:54,319 --> 00:22:59,500
KT: Everyone thinks you're Suze Slapdown, but she isn't. She's Suze Softy.

393
00:22:59,670 --> 00:23:04,260
KT: The kids call her Aunt Softie instead of Aunt Suze. OK, ready?

394
00:23:04,550 --> 00:23:07,750
KT: I love starting my day listening to your podcast twice

395
00:23:07,750 --> 00:23:08,380
KT: a week.

396
00:23:09,050 --> 00:23:13,479
KT: Now that I have our must have documents signed, notarized,

397
00:23:13,489 --> 00:23:16,688
KT: and funded and placed ready for this and placed in

398
00:23:16,689 --> 00:23:20,489
KT: a waterproof and fireproof case, how should the house be

399
00:23:20,489 --> 00:23:24,329
KT: titled in order to pass seamlessly to our beneficiary,

400
00:23:24,719 --> 00:23:29,389
KT: who is our daughter and she's only 2.5 years old?

401
00:23:29,719 --> 00:23:30,560
Suze: Yeah, baby girl.

402
00:23:30,560 --> 00:23:31,280
KT: She's a baby girl.

403
00:23:31,280 --> 00:23:36,150
Suze: I'm sure that if you did the must have documents,

404
00:23:36,439 --> 00:23:41,349
Suze: it's provided that the executor and the successor trustee, everybody

405
00:23:41,640 --> 00:23:44,469
Suze: will take care of the house and the child until

406
00:23:44,469 --> 00:23:51,310
Suze: she's of age. However, I'm a little bit confused. You say,

407
00:23:51,650 --> 00:23:53,719
Suze: cause KT just handed me your email.

408
00:23:54,599 --> 00:23:58,739
Suze: That you have your must have documents. They're signed, notarized,

409
00:23:58,819 --> 00:24:00,400
Suze: and funded.

410
00:24:01,359 --> 00:24:06,239
Suze: If they are funded, what funded means is that you

411
00:24:06,239 --> 00:24:12,479
Suze: have already changed the title of your house, your bank accounts,

412
00:24:12,599 --> 00:24:18,239
Suze: your brokerage accounts into the title of the trust. If

413
00:24:18,239 --> 00:24:22,680
Suze: you haven't done that, you have what's called an empty

414
00:24:22,680 --> 00:24:27,439
Suze: trust because a trust, everybody is like a suitcase where

415
00:24:27,439 --> 00:24:29,280
Suze: you put everything in it.

416
00:24:29,569 --> 00:24:32,800
Suze: And then upon your death, the suitcase is just handed

417
00:24:32,800 --> 00:24:35,079
Suze: to your beneficiaries, and they open it up and they

418
00:24:35,079 --> 00:24:36,270
Suze: get everything that's in it.

419
00:24:37,219 --> 00:24:41,099
Suze: Simple, but if you don't put anything in it and

420
00:24:41,099 --> 00:24:43,770
Suze: you give them that suitcase and they open it up,

421
00:24:43,859 --> 00:24:47,448
Suze: it's going to be empty. So to fund it or

422
00:24:47,449 --> 00:24:50,899
Suze: to pack that suitcase, so to speak, you go, you

423
00:24:50,900 --> 00:24:55,930
Suze: have got to change the title of all of your

424
00:24:55,930 --> 00:25:00,169
Suze: assets from your individual name into the title of the trust.

425
00:25:00,260 --> 00:25:04,219
Suze: Now if you go back to do the must have documents,

426
00:25:04,300 --> 00:25:05,729
Suze: you just go back into them.

427
00:25:06,130 --> 00:25:08,199
Suze: OK, easy for you to do. You know how to

428
00:25:08,199 --> 00:25:12,199
Suze: do that. And you go to the review page where

429
00:25:12,199 --> 00:25:16,719
Suze: you're now reviewing your trust. You'll see right under the

430
00:25:16,719 --> 00:25:21,630
Suze: review it also says fund the trust. Click on there

431
00:25:22,160 --> 00:25:25,680
Suze: and then just follow everything that it says for you

432
00:25:25,680 --> 00:25:29,079
Suze: to do, and then you take it to your bank.

433
00:25:29,560 --> 00:25:33,189
Suze: You take it to the title company. You take it

434
00:25:33,189 --> 00:25:37,459
Suze: to your brokerage firm, and they change it for you.

435
00:25:37,790 --> 00:25:40,989
Suze: The title of your trust is usually like our trust

436
00:25:40,989 --> 00:25:45,149
Suze: is Suze Orman, trustee for the Suze Orman Living Revocable

437
00:25:45,150 --> 00:25:50,599
Suze: Trust dated whatever date it was notarized.

438
00:25:51,000 --> 00:25:55,150
Suze: And so it's just that simple. So you say it

439
00:25:55,150 --> 00:25:59,349
Suze: was funded, but it's not because you would not be

440
00:25:59,349 --> 00:26:02,790
Suze: asking me how should the house be titled in order

441
00:26:02,790 --> 00:26:07,069
Suze: to pass seamlessly. So that, my friend, is how you

442
00:26:07,069 --> 00:26:07,510
Suze: do it.

443
00:26:07,969 --> 00:26:09,770
Suze: KT, are you ready for your quizzy?

444
00:26:10,089 --> 00:26:13,560
KT: I'm always ready for a quizzy. I love quizzies and

445
00:26:13,560 --> 00:26:15,719
KT: everyone listening, it's for you too.

446
00:26:16,130 --> 00:26:16,649
Suze: You don't love all quizzies.

447
00:26:17,689 --> 00:26:20,250
KT: I love quizzies. I just don't. I have a little

448
00:26:20,250 --> 00:26:23,849
KT: trouble with the Roth. So Roth quizzes are a little challenging.

449
00:26:24,010 --> 00:26:26,329
Suze: Yeah, so everybody, I just have to tell you something.

450
00:26:26,560 --> 00:26:31,619
Suze: Today's podcast, I have prepared questions for KT about 18

451
00:26:31,619 --> 00:26:32,239
Suze: of them.

452
00:26:32,869 --> 00:26:36,020
Suze: About Roth IRAs, you remember a few weeks ago I

453
00:26:36,020 --> 00:26:37,859
Suze: said I'm going to do this, and she's going to

454
00:26:37,859 --> 00:26:38,430
Suze: answer everything.

455
00:26:38,500 --> 00:26:39,449
KT: I'm not ready.

456
00:26:39,579 --> 00:26:42,188
Suze: And I, I said this is what we're doing today.

457
00:26:42,219 --> 00:26:44,339
Suze: And she said, Oh no, I've already picked the questions

458
00:26:44,339 --> 00:26:46,579
Suze: for today. I said, but KT, we can do that

459
00:26:46,579 --> 00:26:50,339
Suze: next week. Let's do this this week. Absolutely refused. I said,

460
00:26:50,500 --> 00:26:52,849
Suze: Will you be ready next week? And what did you say?

461
00:26:52,939 --> 00:26:53,329
KT: No.

462
00:26:53,500 --> 00:26:55,930
Suze: No. Will you be ready in a month from now?

463
00:26:56,219 --> 00:26:56,420
KT: Maybe.

464
00:26:56,655 --> 00:26:57,821
Suze: But probably not.

465
00:26:57,821 --> 00:26:58,584
KT: Probably not.

466
00:26:58,795 --> 00:27:01,454
Suze: All right, so what am I gonna do? I'm going

467
00:27:01,454 --> 00:27:05,155
Suze: to take those questions and on March 6th, I'm going

468
00:27:05,155 --> 00:27:08,584
Suze: to read them and ask all of you the questions

469
00:27:08,584 --> 00:27:11,704
Suze: that I was going to ask KT and let's see

470
00:27:11,704 --> 00:27:15,185
Suze: if you can answer all of them, and I will

471
00:27:15,185 --> 00:27:19,265
Suze: explain the correct answer of each one. So don't miss it.

472
00:27:19,305 --> 00:27:21,304
Suze: All right. Therefore,

473
00:27:21,425 --> 00:27:22,854
KT: I'm gonna put that in my calendar,

474
00:27:22,854 --> 00:27:23,385
KT: March 6th.

475
00:27:23,385 --> 00:27:25,905
Suze: I chose a little bit of a tricky one.

476
00:27:26,760 --> 00:27:28,310
Suze: For your quizzy today,

477
00:27:28,479 --> 00:27:29,109
KT: OK.

478
00:27:29,439 --> 00:27:30,069
Suze: All right.

479
00:27:30,199 --> 00:27:30,479
KT: Is it a Roth?

480
00:27:31,280 --> 00:27:33,670
Suze: It's a Roth, but it's tricky.

481
00:27:33,920 --> 00:27:34,239
KT: OK.

482
00:27:34,439 --> 00:27:34,973
Suze: Listen closely.

483
00:27:34,973 --> 00:27:35,359
KT: I'll listen very carefully.

484
00:27:36,560 --> 00:27:40,919
Suze: All right, now before I begin, all right, I just

485
00:27:40,920 --> 00:27:45,329
Suze: want to remind you that last year,

486
00:27:45,770 --> 00:27:50,459
Suze: the phase out range for because this is about last year,

487
00:27:50,709 --> 00:27:55,550
Suze: you can no longer contribute to a Roth IRA if

488
00:27:55,550 --> 00:28:00,938
Suze: you made over $161,000. I just want you to remember

489
00:28:00,939 --> 00:28:05,140
Suze: that you cannot. This year it went up to 165.

490
00:28:05,810 --> 00:28:08,679
Suze: As the max, after that you can no longer contribute.

491
00:28:08,810 --> 00:28:12,260
Suze: All right, so you ready? You remember what I just said?

492
00:28:12,839 --> 00:28:16,650
KT: Max 160, more or less $160,000.

493
00:28:16,650 --> 00:28:20,410
Suze: $161,000. You have to know that figure.

494
00:28:20,569 --> 00:28:21,880
KT: All right, 161.

495
00:28:21,969 --> 00:28:24,329
Suze: After that you can no longer contribute to a Roth.

496
00:28:24,729 --> 00:28:26,920
Suze: All right, as an individual, OK OK.

497
00:28:27,670 --> 00:28:29,349
Suze: This is from William.

498
00:28:30,260 --> 00:28:36,179
Suze: Very simple. Ready. My income last year was just below

499
00:28:36,180 --> 00:28:45,459
Suze: the max income for the Roth IRA of $160,480. How

500
00:28:45,459 --> 00:28:50,020
Suze: much can I contribute to my Roth? He is 35

501
00:28:50,020 --> 00:28:51,060
Suze: years of age.

502
00:28:51,060 --> 00:28:53,770
KT: I think $7000 the max.

503
00:28:54,020 --> 00:28:55,010
Suze: You're positive.

504
00:28:56,180 --> 00:29:00,119
KT: Although, if this is tricky, I'm never positive, but...

505
00:29:00,959 --> 00:29:08,530
KT: he, his income, his total income, right, was 160. The

506
00:29:08,530 --> 00:29:11,060
KT: Roth is 161.

507
00:29:13,359 --> 00:29:16,229
KT: So I would say, why can't he put in 7000.

508
00:29:16,239 --> 00:29:19,150
Suze: The income ranges last year:

509
00:29:20,099 --> 00:29:27,489
Suze: 146,000 anything under that you could contribute the max of 7000.

510
00:29:27,569 --> 00:29:32,770
Suze: Once you get to 161,000, you no longer can contribute

511
00:29:32,770 --> 00:29:41,239
Suze: at all. Between the 146 and the 161, it decreases.

512
00:29:41,930 --> 00:29:46,089
Suze: You can only put in the $7000, if you're under 50,

513
00:29:46,160 --> 00:29:47,969
Suze: $8000 if you're 50 or older.

514
00:29:48,619 --> 00:29:54,859
Suze: If you make under the 146, so how much can

515
00:29:54,859 --> 00:29:59,569
Suze: he put in if he's making only a few $100.

516
00:30:00,660 --> 00:30:04,729
Suze: Under the max till he no longer qualifies?

517
00:30:05,140 --> 00:30:08,260
KT: I'd have it it has to be calculated, Suze, because

518
00:30:08,260 --> 00:30:08,900
KT: if he

519
00:30:09,380 --> 00:30:12,069
KT: Yeah, it has to be calculated. I need a calculator

520
00:30:12,069 --> 00:30:12,310
KT: to

521
00:30:12,310 --> 00:30:12,869
KT: figure that out.

522
00:30:12,949 --> 00:30:15,699
Suze: And how would you figure it out? What is the formula?

523
00:30:16,339 --> 00:30:16,869
Suze: You don't know.

524
00:30:16,979 --> 00:30:20,810
KT: I'd ask you, but, but here's the thing. No, he

525
00:30:20,810 --> 00:30:22,869
KT: can't put in $7000. Let's put it that way.

526
00:30:22,910 --> 00:30:23,359
Suze: But you

527
00:30:23,359 --> 00:30:25,040
Suze: said your answer was 7000.

528
00:30:25,239 --> 00:30:28,060
KT: I didn't know about the tricky part, which was the 140.

529
00:30:28,430 --> 00:30:30,099
Suze: Do you see how she does it, everybody did I?

530
00:30:30,310 --> 00:30:32,030
KT: Why didn't you say anything about that?

531
00:30:33,010 --> 00:30:37,729
Suze: Because I said, uh, for because for years now I've

532
00:30:37,729 --> 00:30:41,560
Suze: been telling you there's a range between this and that anyway, everybody...

533
00:30:41,969 --> 00:30:43,890
KT: And how old is he? 35.

534
00:30:44,209 --> 00:30:45,930
Suze: so take a guess. How much do you think he

535
00:30:45,930 --> 00:30:49,410
Suze: could put in? Just take a guess. Don't try to

536
00:30:49,410 --> 00:30:49,780
Suze: figure it

537
00:30:49,780 --> 00:30:50,160
Suze: out.

538
00:30:50,329 --> 00:30:51,560
KT: 3000.

539
00:30:52,010 --> 00:30:54,560
Suze: The answer to that question is $243.

540
00:30:54,989 --> 00:30:55,560
KT: That's it.

541
00:30:56,010 --> 00:30:58,170
Suze: That's it. Do you want to know how I got it?

542
00:30:58,689 --> 00:30:59,849
KT: Yea, what's the formula?

543
00:30:59,849 --> 00:30:59,969
Suze: Alright everybody,

544
00:31:00,810 --> 00:31:01,520
KT: It's not worth it.

545
00:31:02,260 --> 00:31:05,660
Suze: Here's what you have to do if you make more

546
00:31:05,660 --> 00:31:10,130
Suze: than the max limit, last year 146, this year 150.

547
00:31:10,420 --> 00:31:14,410
Suze: If you make more than that, now what you have

548
00:31:14,410 --> 00:31:15,060
Suze: to do is...

549
00:31:15,599 --> 00:31:18,530
Suze: and this is what you would have to do, William,

550
00:31:18,630 --> 00:31:23,839
Suze: in your case. Last year it was $146 to $161.

551
00:31:23,869 --> 00:31:28,630
Suze: It's a $15,000 difference. You would have to subtract your

552
00:31:28,630 --> 00:31:33,989
Suze: $160,480 from the $161,000.

553
00:31:34,750 --> 00:31:40,349
Suze: Number one, that's $520 difference. That's how much you are

554
00:31:40,349 --> 00:31:47,900
Suze: under the max. You then have to divide that by $15,000.

555
00:31:48,229 --> 00:31:50,420
Suze: Why is that? Because it's a $15,000

556
00:31:50,535 --> 00:31:55,714
Suze: range KT, from the 146 to the $161 and that

557
00:31:55,714 --> 00:32:04,675
Suze: would give you 0.0347. Now you have to times $7000

558
00:32:04,755 --> 00:32:06,305
Suze: which is the maximum

559
00:32:06,949 --> 00:32:10,859
Suze: that anybody under the age of 50 can put into

560
00:32:10,859 --> 00:32:15,900
Suze: a Roth that's the maximum contribution. You have to times

561
00:32:15,900 --> 00:32:21,619
Suze: that by 0.0347 to give you the amount of money

562
00:32:21,619 --> 00:32:25,650
Suze: in this example that you can put into a Roth

563
00:32:26,020 --> 00:32:32,209
Suze: this year anyway, which would equal $243.

564
00:32:32,540 --> 00:32:33,930
KT: So everybody listening.

565
00:32:34,420 --> 00:32:37,900
KT: What she just explained to you, all right, is a

566
00:32:37,900 --> 00:32:38,810
KT: little tricky.

567
00:32:39,209 --> 00:32:39,930
Suze: Not tricky.

568
00:32:40,180 --> 00:32:40,579
KT: It is tricky.

569
00:32:40,660 --> 00:32:44,329
Suze: But everybody needs to know how do you figure out

570
00:32:44,329 --> 00:32:46,699
Suze: if you make more than the minimum.

571
00:32:47,890 --> 00:32:49,599
Suze: To put in the maximum,

572
00:32:50,520 --> 00:32:53,209
Suze: how do you know how much you are allowed to

573
00:32:53,209 --> 00:32:53,770
Suze: put in?

574
00:32:53,849 --> 00:32:54,427
KT: Call Suze.

575
00:32:54,427 --> 00:33:00,489
Suze: Call Suze. But that is the formula. You should I listen

576
00:33:00,489 --> 00:33:04,849
Suze: to it all over again just so you know. All right, KT,

577
00:33:05,489 --> 00:33:09,089
Suze: until this Sunday for another Suze School.

578
00:33:09,589 --> 00:33:11,550
Suze: There's only one thing that we want you to remember

579
00:33:11,550 --> 00:33:13,589
Suze: when it comes to your money, and what is it, KT?

580
00:33:13,989 --> 00:33:16,540
KT: People first, then money, then things.

581
00:33:16,670 --> 00:33:17,729
Suze: Now you

582
00:33:17,910 --> 00:33:20,560
KT: stay, stay great,

583
00:33:20,790 --> 00:33:22,020
Suze: stay safe, stay safe,

584
00:33:22,270 --> 00:33:23,530
KT: stay healthy,

585
00:33:23,709 --> 00:33:27,189
Suze: stay happy, stay healthy and stay listening to the Women

586
00:33:27,189 --> 00:33:29,219
Suze: and Money podcast. Bye bye now.