Suze: September 4th, 2025. Welcome everybody to the Women and Money podcast, and...
KT: Everyone smart enough to listen.
Suze: You did it KT. For some reason, whenever we do
Suze: an open, KT forgets to say, and everybody's smart enough
Suze: to listen, and today is what KT?
KT: September 4th.
Suze: No, today is what?
KT: Ask KT and Suze Anything
Suze: Ding ding ding ding. You got that right. All right.
KT: Do
KT: you believe it's September?
Suze: I do believe it's September and this is obviously a
Suze: special day in our lives.
KT: This is a special day. This was a day of having a
KT: great honor and privilege 13 years ago. Tell them why.
Suze: Yeah, because my mama passed today.
Suze: 13 years ago when she was...
KT: Took her journey, baby...
Suze: She was 97 years of age and KT and myself
Suze: and KT's twin sister Lynn and her husband Tom, we
Suze: were there we...
KT: we
KT: bid her farewell in the most beautiful way.
KT: And it was such an honor for any of you listening,
KT: if you have the opportunity to be with a loved
KT: one when they're taking their final journey, do it. Don't
KT: be afraid. Don't be sad, just do it. It's such
KT: an honor. It is.
KT: It's such a blessing.
Suze: My brother was afraid. My, my brother was afraid, and
Suze: he lives with that sorrow to this day, anyway.
Suze: All right, so you have a question.
KT: I do. Let's start with Cindy. I like Cindy because
KT: she's Cindy the dog walker.
KT: She said, Hi, Suze and KT. Quick question. I'm a
KT: longtime listener and reader of your books many years ago. Yeah,
KT: for me, I purchased VTI on your recommendation. I still
KT: own it, and I'm curious why you never mention that
KT: ETF more. So tell her why you don't mention it,
KT: or do you?
Suze: Have you noticed that I stopped mentioning it?
KT: No,
Suze: Of course not. All right, so anyway, here's the truth, Cindy.
Suze: I still love VTI, the Vanguard Total Stock market Index ETF,
Suze: just that simple, but the reason I switched, and I
Suze: really switched to VOO, which is also Vanguard, which has
Suze: a little smaller expense ratio than the spiders, is that
Suze: VTI versus VOO.
Suze: They have the same exact top 10 holdings which happen
Suze: to be Nvidia, Microsoft, Apple, Amazon, Meta, Broadcom, Alphabet, you
Suze: know I love Google there, Tesla and Berkshire, right, however.
Suze: Those top 10 holdings only make up 33% of VTI, 38%
Suze: of VOO. Therefore, because I knew that those top 10
Suze: holdings would be more aggressive and profitable in VOO than VTI,
Suze: that is why I switched, however,
Suze: VTI is still fabulous. No problem. OK, go on, KT.
KT: OK, this next question is an interesting one because I,
KT: I like to know the answer as well.
Suze: She makes me laugh, everybody.
KT: Hi, Suze and KT.
Suze: Wait, wait, I just have to tell you every once
Suze: in a while she's reading these and she looks at
Suze: me and she says, I don't know
Suze: the answer to this one and I go, KT, of
Suze: course you don't. That's why it's ask KT and Suze.
KT: Anything
Suze: You ask KT. Susie answers. All right, go on.
KT: Ok, so this question is a good one. It said, Hi,
KT: Suze and KT. My spouse and I are ready to
KT: withdraw $4500 a month from our combined
KT: $1.5 million in 401ks and IRAs. She is 77. I
KT: am 65. Most of our retirement savings is under my
KT: name because she is a retired educator with a pension.
KT: Does it matter in the long run whose account we
KT: withdraw from?
Suze: Hmm.
Suze: Why are you looking at me like that?
KT: Well, does it? Yeah, it does.
Suze: All right, everybody, listen, Peggy, it's not necessarily which account
Suze: does it matter that you withdraw from as much as
Suze: what are you invested in within those accounts now, obviously.
Suze: At 77 she's taking her RMDs, so you have to
Suze: take into consideration required minimum distributions. How much does she
Suze: have to take out every single year from her account,
Suze: and then you can decide after that amount which account
Suze: has the best investments for you to withdraw from. So
Suze: for instance, if you're invested in good quality stocks like
Suze: maybe some of the ones I just mentioned.
Suze: And you're going for growth and you like them and
Suze: you feel secure with them, why sell them now just
Suze: to withdraw the money? So again after the RMDs, it
Suze: really doesn't matter that much.
Suze: What matters is what the accounts are invested in and
Suze: therefore that's where the money should come from. All right.
KT: OK, next question is from Deanna. Hi Suze, I'm from Utah.
KT: My husband and I have a 529 plan for our
KT: two grandchildren. What happens when we die? Where does this
KT: money go? Can I pass the 529
KT: plan on to my daughter who is the mother of
KT: the two grandchildren.
Suze: Yeah, you can, right, but what you do is you
Suze: name your daughter or the mother of the grandchildren or
Suze: whatever as a successor owner that way she will take
Suze: over management if you die. Just that simple. All right, KT.
KT: OK, next question from Audrey. She said, hi Suze and KT.
KT: My husband and I are a blended family. We took
KT: care of our wills a few years ago, but as
KT: time goes on and I listen more and more to
KT: your podcast, there are some things I would like to
KT: change in our documents.
Suze: Just like me!
KT: Just like us. You're not alone, Audrey.
KT: She said, I did purchase the must have documents, but
KT: I don't know how to translate and transfer what I
KT: currently have in my will into those documents. So let's
KT: explain to her how that works.
Suze: So what
Suze: you have to do, Audrey, is that given that you
Suze: created a will, possibly a trust, whatever it may be
Suze: outside of the must-have documents to begin with.
Suze: You cannot physically transfer them into the must-have documents where
Suze: they automatically transfer over. You have to, with the must
Suze: have documents, create new documents, and you probably should do
Suze: that anyway just to make sure that what you wanted
Suze: back then is what you want now because obviously you
Suze: say you want to make some changes, so you would
Suze: just start over because one thing interesting with the must-have
Suze: documents is that you have to do all four must-have
Suze: documents at one time so when you go on you'll
Suze: see you answer all these questions and really not that many,
Suze: and it will populate all four at once: the will,
Suze: the living revocable trust, the advanced directive and durable power
Suze: of attorney for health care, as well as the financial
Suze: power of attorney. It will do all of those at
Suze: once for you.
Suze: So you might as well just do that and there
Suze: you go, and those will be your new documents. Make
Suze: sure you get them notarized and that you fund the trust,
Suze: which means you transfer the name of your real estate
Suze: or whatever into the name of the trust. All right, KT.
KT: So Suze, tell everyone where to go to get the
KT: must-have docs.
Suze: Yeah, everybody listen to me. If you don't have the
Suze: documents that I just talked about.
Suze: I'm telling you you are without a shadow of a
Suze: doubt making the absolute biggest mistake in your life, and
Suze: believe it or not, the less money you have, the
Suze: more you need those documents and I'm now strictly the
Suze: educator of those documents. So what you would do is
Suze: you would go to must have docs.com.
Suze: And currently they are $99 and what's great about that
Suze: is it's $2,500 worth of state of the art documents
Suze: that you can share with any family member. It's not
Suze: a big deal because the object of them isn't that
Suze: every single one of you needs to buy one.
Suze: It's that only one of you needs to step forward
Suze: and make sure that not only have you protected yourself
Suze: but you've protected all of your family members and maybe
Suze: all of your friends if you want to as well.
Suze: All right.
KT: OK, my next question is from Estee. Hi Suze and KT.
KT: I watched your TV show, Suze back in the day.
Suze: You know what? Wait, wait, wait, wait, you can watch
Suze: it again because they are premiering little by little on YouTube.
Suze: So go to youtube.com/ Suze Orman. That is my personal
Suze: and official YouTube channel and people are loving so much
Suze: watching those shows all over again. All right, go on.
KT: She said, I watched the TV show back in the day,
KT: have been faithfully listening to you and KT. I take notes.
KT: I read the Ultimate Retirement Guide twice.
KT: Then she said, I may have missed this, but how
KT: do you feel about reinvesting dividends three quarters of the
KT: year and taking the cash in the fourth quarter for
KT: annual living expenses and taxes instead of buying an annuity?
KT: So that's what Estee's question is.
Suze: Um, let me see this email...
KT: And Estee, just so we all know, is, is about
KT: 68 years old. So that's why I'm wondering an annuity.
Suze: Here's the thing number one, I don't want you to
Suze: do an annuity. That's number one, but number two, right,
Suze: if you reinvest the dividends, that means you are reinvesting
Suze: into the shares of the stock that you already own.
Suze: And then you take the cash in the fourth quarter,
Suze: you can do that as long as that dividend in
Suze: the fourth quarter is enough for your annual living expenses.
Suze: Does that make sense? So if you're going to do
Suze: it that way and you know that you are invested
Suze: in a stock that's dividend has been increasing over the
Suze: past 10 years, I don't have a problem with that
Suze: because remember dividends are not guaranteed. If the company gets
Suze: in trouble, they could absolutely cut their dividend.
Suze: And you don't want to be in that situation, but
Suze: if you can live off of the fourth quarter dividend, fine,
Suze: you can take that in cash, but it becomes very
Suze: complicated because then you have to change from reinvesting to
Suze: da da da. So just think about it, but I
Suze: would not be doing an annuity no matter what. All right.
KT: Good morning, Suze and KT.
Suze: It is, is it not, KT?
KT: Yes it is. My current relationship is not working out.
Suze: What else is new? You know how many emails we
Suze: get that start with that exact saying?
KT: My current relationship is not working. You're not alone. You're not alone.
KT: There's a whole lot we get like this, Susan, but
KT: at least Suze, you and I are working out just right. So,
KT: so Susan says we bought a house together. I own 25%
KT: of the house. The house is worth about $520,000.
Suze: Ok, so she owns about $130,000 worth of that house.
KT: My plan is to move out and buy another house.
KT: I will have the equity from the house, which he
KT: will either pay to me or the house will be sold,
KT: and I'll get it that way. Susan has $25,000 in
KT: an emergency fund with no debt, about $345,000 in a
KT: 401k Roth, and traditional IRA accounts.
KT: She earns about $110,000 a year and does not plan
KT: on retiring. I really do not want a mortgage at
KT: this stage in my life. I'm 61, but will have
KT: to take money out of my retirement in order to
KT: buy my home mortgage free.
KT: So, she said she can also buy it and take
KT: a mortgage out means she no longer contributes to her
KT: retirement and she wouldn't be debt free. Can you help me?
KT: This is the real clincher, everybody. Susan said, I feel
KT: very anxious and not secure at all.
Suze: Ding ding ding pop quizzy.
KT: Yeah, I'll tell you what I would do.
Suze: Pop quizzy...
Suze: everybody before KT answers because KT people have been writing
Suze: and saying, please bring back the quizzy.
KT: Oh, no way.
Suze: Well, pop, here's the wait before you answer, everybody, how
Suze: would you, seriously, answer this question? She's 61 years of age.
Suze: She only has $25,000 in an emergency fund. No other debt.
Suze: She has about $345,000 again in her retirement accounts. Think
Suze: about that. She really doesn't want a
Suze: mortgage so she would at the age again of 61
Suze: have to take money out of her retirement accounts in
Suze: order to buy the home mortgage free. She feels anxious.
Suze: She could take a mortgage, but she doesn't want to. KT.
Suze: How would you answer that?
KT: Four letter word baby: rent. She's 61 years old. She's
KT: just leaving a relationship.
KT: It's emotional. They broke up. Don't go and make your
KT: life stuck again. Just be free and rent for a
KT: couple years. You can afford to rent with that kind
KT: of a salary and still be free and rent simple.
KT: One of the things that I often ask when we
KT: read these and when I read, I the, the puzzle
KT: needs to be put together with all the pieces and
KT: you often send us a question but you don't tell
KT: us where you live for instance. That would have a
KT: great deal of bearing on, you know, whether you buy
KT: and rent, so on and so forth.
Suze: Ding ding ding ding
KT: Rent, right?
Suze: Yes, but for many different reasons. OK, all right, so
Suze: first of all, what is my main law of money
Suze: when it comes to you after you have suffered the
Suze: loss of a loved one? You are to do absolutely
Suze: nothing other than keep your money safe and sound for
Suze: at least one to two years.
Suze: Cause you're saying to me that your relationship is not
Suze: working out. Don't tell me that that doesn't have an
Suze: emotional impact on you, whether you like him or her,
Suze: you dislike them or whatever, it has an emotional impact.
Suze: Now you don't want to take money out of a
Suze: retirement account. That is just the stupidest thing you could
Suze: ever do simply to what? Buy another house. No way,
Suze: not on our watch.
Suze: You really shouldn't decide anything until you know how much
Suze: money you are going to have. What is he going
Suze: to actually be giving you if he buys you out,
Suze: and if you sell it, remember there will be real
Suze: estate commissions, all kinds of things. This is no longer
Suze: a seller's market.
Suze: Prices are going down and down. Therefore, just wait to
Suze: see how much you really get when that is complete,
Suze: one step at a time.
Suze: Next, how do you know what to do? If you're
Suze: about to do something and it makes you feel insecure
Suze: right now you feel very anxious and not secure at all. Therefore,
Suze: you are to do nothing. So before you do anything,
Suze: check that little stomach of yours, and if it is nervous,
Suze: that is yourself telling yourself, don't do it. Remember, once
Suze: you do something, it's already done.
Suze: If you haven't done it yet, you have a lot
Suze: of time to do it. All right, there you go.
KT: I was right.
Suze: I gave you a ding ding ding ding ding ding
Suze: ding ding ding ding ding.
KT: OK, next question is from Melissa, she said. Suze, I'm
KT: a single mom with a 16 year old son.
KT: I'm also a landlord with just a few properties.
Suze: Oh, just a few properties?
KT: The question is, how do I protect my real estate
KT: from the type of economy that we are currently in?
KT: How do I bulletproof myself from losing money? When you
KT: find that answer, share it with all of us.
KT: And then she said taxes are up, insurance is up
KT: at the same time, so are the interest rates. I'm
KT: waiting for interest rates to go down so I can
KT: invest in another property outside of New York. These properties,
KT: which are passive income, are my main source of income.
Suze: Listen, here's the thing...
KT: Make it a quizzy again.
Suze: All right, ding ding ding, go for it.
KT: Don't buy any more property right now at all.
Suze: That's your advice.
KT: Yeah.
Suze: All right, that's her advice whether it's right or wrong.
Suze: I can't tell you. However, let me just say something.
Suze: I talk about investing obviously all the time and I
Suze: talk about diversification. What concerns me is, your main source
Suze: of passive income happens to be properties, and you're already
Suze: asking how do you bulletproof yourself from losing money. When
Suze: it comes to real estate it's very, very difficult to
Suze: bulletproof yourself from losing
Suze: money. Why? You cannot protect yourself against insurance going up.
Suze: You cannot protect yourself against property taxes going up. You
Suze: cannot protect yourself against the house needing repairs. You cannot
Suze: protect yourself against renting to somebody who all of a
Suze: sudden loses their job and they stop paying you and
Suze: they won't leave.
Suze: And now you may have mortgage payments with no income.
Suze: You cannot adequately truthfully protect yourself against climate change and
Suze: what Mother Nature may bring upon you.
Suze: So there are all of these you can't do anything about.
Suze: But what you can do is maybe think about, oh,
Suze: do I have anything invested in dividend paying stocks? Do
Suze: I have at least an eight month emergency fund maybe
Suze: generating some income to me? Do I have any Treasury bill,
Suze: bonds or notes that are pretty much guaranteed? What else
Suze: do you have? But you're waiting for interest rates to
Suze: go down so you could invest in another property.
Suze: So the truth of the matter is I don't know.
Suze: I'd like to hear that you were investing in something
Suze: other than property, even if you did an REIT within
Suze: a retirement account, but I don't know enough about you,
Suze: but I can tell you this when it comes to
Suze: real estate.
Suze: It is very, very difficult to protect yourself, especially with
Suze: the insurance market today. You best think about it.
KT: No bulletproof, right?
Suze: Mhm.
KT: OK, Suze, next question is from Mark. I really like this question.
KT: He said, Suze, I'm 70 years old and I have
KT: 1.5 million in a rolled over 401k.
KT: I've been converting it into a Roth for the past
KT: three years, and I'm wondering when is it a good
KT: time to stop converting and just pay the grim reaper.
KT: So Mark's question is how will the RMDs and converting
KT: mix in the next few years?
Suze: Yeah, so what, what I...
KT: I would love to hear that too.
Suze: Why?
KT: Just curious because that's a great question. No one ever
KT: asked that question.
Suze: All right, Mark, here's what you first need to know,
Suze: and everybody who is on RMDs or who will eventually
Suze: be on RMDs, and you want to convert from a traditional,
Suze: which is a
Suze: pre-tax retirement account to a Roth, which is after tax.
KT: Tell them what an RMD is.
Suze: Required Minimum Distribution.
KT: And it starts at what age?
Suze: 73 currently and then very shortly it will be 75
Suze: just so you know. However, here's what you have to
Suze: understand you cannot convert,
Suze: in the year that you have to take RMDs until
Suze: you have taken your RMDs, and after you have taken
Suze: your RMDs, then you can convert. So that's how that
Suze: will work for you.
Suze: How do you know if you should just stop converting
Suze: and just paying the grim reaper? KT's laughing cause she
Suze: knows how hard that was for me to say anyway,
Suze: but here's how you know you would only convert if
Suze: in fact you don't need the money that you are converting.
Suze: You want to leave it in there for growth. You
Suze: don't need to touch it for years, if ever you
Suze: want to leave it to your beneficiaries and you want
Suze: to leave it to them absolutely tax free. Then you
Suze: would continue to convert. If in fact you know that
Suze: you're going to be needing that money to live on,
Suze: then you would maybe just take out what you want
Suze: from your traditional IRA.
Suze: And what would you do? Live on it and not
Suze: convert it to a Roth, just that simple, cause remember
Suze: there are still some rules in everything with a wroth
Suze: and a Roth conversion, even at your age, believe it
Suze: or not. So therefore that's how you would know. So Mark,
Suze: it's just that simple. All right, KT.
KT: OK.
KT: Suze, next question is from Kelly, and Kelly asks, does
KT: it make more sense to purchase an income annuity with
KT: qualified or non-qualified money to shore up guaranteed income needs
KT: to supplement my pension and Social Security?
Suze: So that's simple. If you
Suze: are going to buy an income annuity all right however,
Suze: do it with non-qualified money meaning money outside of a
Suze: retirement account, because remember in a retirement account, a pre-taxed
Suze: retirement account, all right, which is qualified money.
Suze: You are eventually going to have to pay RMDs, and
Suze: then it becomes very confusing as to with an income annuity,
Suze: what was the value of the balance of that income
Suze: annuity at the end of the year prior to the
Suze: year you're taking RMDs very confusing. So,
Suze: do it with non-qualified money. Last question, KT.
KT: This is from Amy and Amy is
KT: 55.
Suze: Yeah. What were we doing? Remember what we were doing at 55?
KT: That was a great year.
KT: They were so much fun.
KT: She said, I have an old 401k balance of $69,000
KT: that I just rolled over into a Schwab traditional IRA.
KT: My plan was to convert little by little into my
KT: Roth IRA, but when I was looking back at my
KT: Suze notebook, I noticed something about the pro rata rule.
KT: My notes were incomplete.
KT: So now I'm wondering if I can still convert to
KT: my Roth IRA. I do have another traditional IRA, and
KT: I know that's what the pro rata rule refers to.
KT: Please help me. So...
Suze: Pop, pop quizzy, pop quizzy, can she or can she
Suze: not KT?
KT: Oh...
Suze: Will she be subjected to the pro rata rule because
Suze: she has, uh, uh, because she's, she's shaking her head
Suze: up or down...
KT: I'm asking Suze, help me!
KT: Can she or can she not, right, wait, so go ahead,
KT: keep going.
Suze: So can she convert to a Roth given the fact
Suze: that she has a traditional IRA? Is she going to
Suze: be subjected to the pro rata rule?
KT: I think you are. (Suze makes the 'wrong answer' noise).
KT: Oh, you're not. All right, wait, but can I just
KT: say something? Suze, on February 18, 2024, you did an
KT: entire podcast about the pro rata rule
Suze: And Roth IRAs.
KT: So, so Amy, go back and listen to it.
KT: And that's for everyone listening February 18th, 2024.
Suze: All right, so but here's the scoop, Amy, you are confusing
Suze: conversion with a backdoor Roth. The pro rata rule only
Suze: relates to a back door Roth period. Which means you
Suze: have too much income to get new money
Suze: into a Roth IRA. So what do you do? You
Suze: put money into a traditional IRA. You make it nondeductible,
Suze: and then you convert it to a Roth, but you
Suze: can only do that if you don't have any pre-tax
Suze: retirement account outside of your employers. You are simply converting,
Suze: from a pre-tax to a wrath, which means you are
Suze: going to pay taxes on that money, and the 5
Suze: year clock will start the day you convert, every time
Suze: you convert. So no, it does not apply to you
Suze: at all. But KT, I'm so proud of you. You
Suze: went back and looked up that podcast.
KT: I did, I did should have
KT: listened to it and I would have gotten it.
Suze: Anyway, all right, there you go. So until Sunday when
Suze: I'm gonna do a different kind of Suze School.
KT: Tell them what you're doing.
Suze: So I was looking through some of the emails and
Suze: Doctor E, so if you're listening, know this podcast is
Suze: going to be about you, asked
Suze: a question and I realized rather than letting KT ask
Suze: it on Ask KT and Suze Anything, I'm going to
Suze: turn this one into a Suze school and really teach
Suze: you along with Doctor E what you need to know about...
Suze: You're going to have to tune in and find out.
Suze: So we are in September.
Suze: And because we are now in September, I promised one
Suze: of the listeners who wrote in that said, Suze, please
Suze: go back to closing the podcast with your traditional way
Suze: of doing it and I said for you, for the
Suze: rest of
Suze: the year, we will do that. So there's really only
Suze: one thing we want you to remember when it comes
Suze: to your money, and it is this:
KT: People first, then money, then
KT: things.
Suze: Now you stay safe and secure. See you Sunday. Bye-bye.