Podcast Episode - Ask Suze & KT Anything: I Can’t Afford To Go To My Son’s Wedding


401k, CDs, Debt, IRA, Students


May 05, 2022

Listen to Podcast Episode:

On this podcast of Ask Suze & KT Anything, Suze answers questions from listeners about rolling over 401Ks, beneficiaries, scholarships, early withdrawal penalties and so much more!


Podcast Transcript:

00:00:33
Suze: May Fifth, 2022

00:00:37
KT: Good morning Suze. Do you know what today is?

00:00:39
Suze: Well, first you have to welcome everybody, KT.

00:00:42
KT: Welcome everybody to the ask Suze and KT, anything, anything podcast, you should ask about some of my recipes for Cinco de Mayo.

00:00:53
Suze: You have recipes?

00:00:54
KT: Yes, I do.

00:00:56
Suze: What are we eating today?

00:00:57
KT: We're going to have, well we're going to try to do some really delicious fish tacos, maybe a little bit of beans, rice and beans.

00:01:06
KT: And I have an idea to do my tuna tartare with avocado delicious.

00:01:12
Suze: You know, KT people are writing in and they are asking, what do we do with all the fish that we catch?

00:01:21
Suze: So tell them,

00:01:22
KT: Well, the first thing we do is we share it and that's the most important thing. The second thing we do is we consume it. And the third thing we do is we try to save and freeze certain types of fish that come only at seasonal.

00:01:41
KT: You know like the wahoo,

00:01:43
KT: you can't catch wahoo now until October if you're lucky. So things like that, we kind of, you know put aside

00:01:51
Suze: but all of you should know that we do not do any sport fishing on any,

00:01:56
KT: no, no, no, we are not catch and release girls,

00:01:59
Suze: we don't catch a fish just for the sport of it.

00:02:02
Suze: And you have to remember that we live on this tiny little island where most of the Islanders do not have the type of equipment needed to catch certain fish like wahoo. So when we go out there or to even catch tuna,

00:02:18
KT: we share everything with them. A lot of our catch with

00:02:22
KT: our family, with friends with the Islanders. Everybody loves, we catch barracudas, which Suze and I don't eat,

00:02:31
KT: but boy barracuda meat is really sweet and white and delicious. We just don't

00:02:38
KT: care for it, we don't like it. So I, we get that to the Islanders and they love it. What Suze.

00:02:44
Suze: There's a morning show that I love to watch every morning

00:02:48
Suze: And it's about what's happening in the world and things you need to know and two of the hosts, sometimes when they open up, spend 10 minutes talking about baseball

00:02:58
Suze: or talking about some sporting event and I'm sitting there thinking to myself, I don't care about the sporting events. Tell me what's going on in the world. So for all of you tuning in to this podcast,

00:03:09
KT: sorry, we bored you with our machine stories, so let's get right to it, Suze. Okay, so first question is from Mayanne,

00:03:18
KT: Suze, my son is having a destination wedding. Everyone at obvious obvious that Maryanne needs to travel far to attend this wedding and here's the story, I'm semi retired but I work part time, I have $10,000 in credit card debt,

00:03:38
KT: $2,000 in savings.

00:03:41
KT: I'm only 54, but I understand that at this age I should be far more financially responsible. I need to secure my financial future. She just got a tax bill of $3,000 and she now needs to survive on her credit cards and that will cost her at least another $5,000. So

00:04:03
Suze: she goes to the wedding.

00:04:04
KT: Yeah. I don't want to miss my son's wedding. I feel like there will be some resentment if I do not go. This is a really heartbreaking decision. What do I do? Please help?

00:04:17
KT: Well, we know the answer to that. Everyone.

00:04:20
Suze: Not necessarily. You think KT, I'm just going to say, don't go.

00:04:24
Suze: Right. You think that

00:04:25
KT: right? All

00:04:27
Suze: right. Here's what I really think Maryanne. One of two things are happening here.

00:04:35
Suze: Either. Your son has absolutely no idea about the severity of your financial situation.

00:04:44
Suze: You really don't have $2,000 in savings. You have

00:04:50
Suze: $13,000 of money that you owe before this wedding.

00:04:55
Suze: $10,000 in credit card debt. $3,000 to this tax bill. So the truth of the matter is

00:05:02
Suze: You are if you use up your savings, you owe $11,000 and you have no savings whatsoever. If you look at it that way, but you're thinking about possibly adding $5,000 onto your credit cards. Plus

00:05:21
Suze: that reduces your credit limit. Why? Because you only have so much of a credit limit. But you're still using your credit cards simply to live on. You cannot afford this on any level on your own. That's number one. So back to what I was saying.

00:05:39
Suze: Either your son has absolutely no idea about the severity of your financial situation

00:05:46
Suze: or if he does,

00:05:49
Suze: I'm just going to say this. How dare he,

00:05:53
Suze: how dare he without talking to you about it?

00:05:57
Suze: Plan a destination wedding. Knowing that you can't afford to go without offering to pay for you.

00:06:05
KT: I don't think he knows.

00:06:07
Suze: We don't know. If he knows or not

00:06:09
KT: then if he doesn't know, he should pay for his mom. If he wants her there.

00:06:14
Suze: If he wants her there. So I was getting there, KT. But if he knows

00:06:19
Suze: and he has planned this destination wedding. Knowing your circumstances,

00:06:25
Suze: the hard feelings of resentment

00:06:29
Suze: shouldn't be from him to you.

00:06:32
Suze: It should be from you to him for not wanting his mother there enough that he would have planned a wedding that you could attend without having it cost you a penny. If on the other hand,

00:06:45
Suze: and I hope the other hand is what's true. He doesn't know anything about the severity of your financial situation.

00:06:52
Suze: You are to tell him

00:06:54
Suze: and you are to say, sweetheart, I love you more than life itself. But let me tell you a little bit about what's going on with me financially. So, if you want me to come and I want to come more than you have any idea.

00:07:08
Suze: two things. Either you're going to have to pay for me or if you can't pay for me

00:07:15
Suze: then how about if we at least have a zoom wedding where you zoom me in so I can participate that way.

00:07:24
Suze: Those are your choices. But the possibility of you paying for this by putting it on your credit cards is not happening on my watch. No way.

00:07:35
KT: Well there you go, Maryanne call your son.

00:07:38
Suze: You know what I would like all of you to do that. We're just listening to that. Can you go on to the Women and Money app

00:07:46
Suze: and under this podcast that released today,

00:07:51
Suze: it's up there for a while on my wall. Can you tell me and send in an email that says or you can do it on ask Suze podcast at gmail dot com. Do you think her son knows about her financial situation or does not

00:08:07
Suze: just curious if you think he does or he doesn't. Alright sorry KT, go on.

00:08:12
KT: My vote is he does not know

00:08:15
KT: or he would have never assumed his mom should just fly to wherever that destination is.

00:08:20
Suze: And I'm going to tell you, I think he knows.

00:08:22
KT: Okay, let's say it if he does anyway, this next one's from Kate. I think I know the answer. This has to do with my friend Roth. Hello KT and Suze.

00:08:32
Suze: Wait, I know I keep interrupting you. I just have to say something that's so hysterical.

00:08:37
Suze: Somebody wrote in a 27 year old who is doing so incredible. All this money saved the perfect situation. You know what his mother named him

00:08:50
Suze: because she watched the Suze Orman show for all these years. She named him Ira after I. R. A. Is that funny?

00:09:01
KT: I told you if I had we had a baby our first son would be called Roth

00:09:05
Suze: or our first daughter.

00:09:08
KT: Now that Roth is a man's name. It's not a girl.

00:09:11
Suze: So it doesn't matter today.

00:09:13
KT: Okay ready.

00:09:14
KT: I am leaving my current job where I have a Roth 401(k) . I'm trying to figure out what to do with this account. Once I leave we make about 300,000 year. So don't we don't qualify for a Roth IRA

00:09:30
KT: what options do I have? Many thanks Kate.

00:09:34
KT: I have. I know the answer.

00:09:36
Suze: Let me see this email just so I can read it just so I can make sure I heard it correctly.

00:09:42
Suze: She has a Roth 401

00:09:43
KT: K. Right

00:09:44
Suze: so she wants to know what are her options that she has

00:09:48
Suze: because she's leaving her current job

00:09:52
Suze: but she doesn't say her age.

00:09:55
Suze: Alright.

00:09:55
KT: She's assuming that she's young but she and her husband combined make over 300.

00:10:00
Suze: Yeah but she's leaving her

00:10:03
Suze: right job so it

00:10:04
KT: can't she roll it over?

00:10:05
Suze: so what she can do everybody and this is important for all of you to know

00:10:11
Suze: Is that she can if she's leaving she has a Roth 401k.

00:10:17
Suze: She can roll that over into

00:10:21
Suze: a Roth IRA

00:10:24
Suze: At any discount brokerage firm she wants. Even though it doesn't matter KT how much money she's making,

00:10:30
Suze: doesn't matter. Her income income has nothing to do with converting an account or rolling over accounts. It only has to do with if you're going to contribute yearly to an Roth IRA,

00:10:45
Suze: that's it.

00:10:47
KT: I

00:10:47
Suze: want all of you listening to this to get this right,

00:10:52
Suze: When you go from a Roth 401K.

00:10:57
Suze: To a Roth IRA. Even if you had the Roth 401K . For 15 years,

00:11:06
Suze: your time period does not transfer with you.

00:11:10
Suze: So you all want to have a Roth IRA, even if all of it has in, there is 50 bucks that you start right now

00:11:20
Suze: so that when you do end up retiring and you want to take money from a Roth 401K . And put it into a Roth ira by rolling it over.

00:11:31
Suze: If your Roth IRA has already been opened for five years,

00:11:36
Suze: Then you meet the five year time clock. And for those of you who don't know what I'm talking about, I did an amazing podcast on the five year rule that all of you should know about. And if you look up the podcast on February 6

00:11:53
Suze: and you should really mark that podcast because you will need to go back to a time and time again to make sure that you don't forget anything about the five year rule that podcast will teach you everything you need to know.

00:12:06
KT: So it does

00:12:07
Suze: not matter if you don't qualify for a Roth IRA

00:12:12
Suze: Right now. What you will do

00:12:15
Suze: is when you roll it over

00:12:18
Suze: you can roll it over into a Roth IRA

00:12:24
Suze: Then it will be a Roth IRA. Rollover. Not contingent on income and the time clock will start the day that you do that. So that is your option and that is probably exactly what you should do. All right,

00:12:38
KT: okay. Next question Suze is from Sharon. Hi Suze. I opened a personal account using my social security number to purchase an I bond.

00:12:47
Suze: Yeah. Yeah. Yeah.

00:12:48
KT: I also want to purchase other I bonds under my business smart. Do I need to separate accounts?

00:12:57
Suze: Yes.  Next.

00:12:58
KT: Okay that's good.

00:13:00
Suze: Everybody. You need to get this right. You can only have one account under your name. If you're going to open up another account as a trust account, a business account, your spouse has to be a separate account. So you have to open up a whole new account.

00:13:17
KT: Ok, good. Next question is from Suzy.

00:13:21
KT: Hi Suze and KT. I got your will and trust kit to get my affairs in order.

00:13:25
Suze: Good on you.

00:13:27
KT: Yes. As I complete the trust portion and proceed with funding the trust. I wasn't sure if I should include my regular banking accounts

00:13:38
KT: which I had already added beneficiaries to.

00:13:42
KT: Should I include that in the revocable trust I recall you stated in previous podcast that the beneficiaries would trump the trust. So if I have a power of attorney, should that be sufficient with beneficiaries to the banking account

00:14:01
KT: in the event that I am incapacitated?

00:14:04
Suze: The reason why I really want all of you

00:14:08
Suze: and I've said this before and I'm going to say it again that if you're doing a revocable living trust and my opinion is most of you should have one

00:14:18
Suze: is that you want your bank accounts to be owned by the trust.

00:14:24
Suze: You also want the beneficiaries to be the trust. And the reason is this all of us think that everything's gonna go exactly like we think it's going to go

00:14:37
Suze: and a beneficiary or a pay on death account for a bank account only allows your beneficiaries to get that money if you die.

00:14:49
Suze: If you don't die, it doesn't help them at all. If you become incapacitated, they cannot pay your bills or write your checks for you. Now you say you have a power of attorney, so that should be sufficient enough that in case you become incapacitated, they can step in for you. I don't think so. And the reason is this: many financial institutions do not trust. Power of attorneys when the person who granted the power is already incapacitated.

00:15:25
Suze: And the reason is this, you could have revoked that power of attorney, You could have done another one and that was just an old one and the bank has no idea

00:15:37
Suze: if it's valid or not. When you have an incapacity clause within the trust as my must have documents do.

00:15:46
Suze: If there is an incapacity

00:15:49
Suze: and you named somebody to be your successor trustee, they then just simply take that trust into the bank. In fact, the bank already has it.

00:15:58
Suze: They see the date on it and they absolutely trust that

00:16:04
Suze: because it's been signed and notarized and they believe that.

00:16:09
Suze: So I would rather see you truthfully do. What do a bank account that's owned by the living revocable trust? One more thing.

00:16:19
Suze: What happens if you

00:16:23
Suze: and your beneficiaries? Maybe it's your son,

00:16:26
Suze: your daughter,

00:16:28
Suze: your kid,

00:16:29
Suze: you're all in a car crash together

00:16:32
Suze: and you die.

00:16:35
Suze: But now your beneficiaries are incapacitated and they can't really inherit anything because they're not capable

00:16:42
Suze: or you're in a car crash, you become incapacitated and your beneficiaries die. Now, who's going to take care of you? Or maybe your power of attorney for finances became incapacitated? Who's gonna take care of you? These are things that a trust

00:17:02
Suze: thinks about for you because you don't like to think about him yourself.

00:17:07
KT: All right, Next question is from Lori.

00:17:10
Suze: You seem very low key today.

00:17:12
KT: I do?

00:17:13
Suze: Yes.

00:17:14
KT: Why? That was a really low. That was a very sad scenario. Why would I be upbeat after listening to that scenario of everybody dying or getting incapacitated.

00:17:27
Suze: I know, but

00:17:28
KT: it's not something I'm going to be upbeat about

00:17:30
KT: on any level. You should

00:17:32
Suze: see KT, KT cries at everything,

00:17:36
KT: everything

00:17:37
Suze: will be watching

00:17:38
Suze: a news report And all of a sudden I look over and she is crying.

00:17:42
Suze: Her and Colo both

00:17:46
KT: Colo sits with me. He goes turn it, turn it, turn the channel, turn it, turn it.

00:17:51
Suze: The two of them are such cry babies. Alright, go on.

00:17:54
KT: Okay, so this one upbeat. Upbeat about this one. This is from Lori. Yeah baby.

00:18:01
KT: I'm 57 Suze. I have a 401K . With Fidelity valued at roughly $850,000. Yeah baby. I plan to work another 10 years. Is it wise to roll that over into an IRA?

00:18:20
KT: Well

00:18:21
Suze: She wouldn't want to roll it to a Roth IRA because all 850,000 would become taxable to her

00:18:26
KT: at that point.

00:18:27
Suze: So you could probably, the place where you work would allow you to do a partial rollover at this point. But with 10 years left to work I would just leave it exactly where I had it. But

00:18:40
Suze: I would really think about

00:18:42
Suze: making contributions to the Roth 401 K versus the traditional 401 K. Alright.

00:18:49
KT: Oh

00:18:49
Suze: but wait I have something more to say

00:18:52
Suze: one thing Lori is this,

00:18:54
Suze: if you have money in a Roth 401 K. That you're going to start contributing. Like I said a little bit ago, make sure you open up a Roth IRA now if you don't have one to start the time clock,

00:19:10
Suze: even if that means you don't qualify for a Roth contributory run right now. Open up a little traditional one, 50 bucks and convert it to a Roth. So the time clock starts now. So 10 years from now, if you're contributing to a Roth 401 K. At your place of employment,

00:19:29
Suze: that when the time comes, you can roll over into

00:19:32
Suze: a Roth IRA tax free and you've already met the five year time clock rule. Alright,

00:19:38
KT: great. Next question is from Loretta,

00:19:41
KT: This is for her 95 year old mom. She has a good portfolio and has been wisely investing since she married in the 1940s. She is in good health and still interested in looking after her assets which are in a trust. She recently had a long term bond mature for $100,000.

00:20:04
KT: We were wondering Suze, if you think mom is better off keeping in keeping it in cash or putting some in a two or three year treasury or I bonds.

00:20:17
KT: I love this question. I loved that her mother is 95 and still very engaged in her finances.

00:20:24
Suze: Yeah. You know, at 95. Um

00:20:27
Suze: obviously if you wanted to put some in the stock market in high yielding dividend stocks and everything you could, however,

00:20:34
Suze: I think why put any stress on yourself and or your mom

00:20:40
Suze: because she doesn't need the $100,000. So why not just keep it safe and sound which means put $10,000 obviously into a series I bond, you know how much I love them. But there's nothing wrong with purchasing two or three year treasury notes

00:20:56
Suze: at a nice interest rate here 2.5, 2.7. They keep going up and down

00:21:01
Suze: and just have it safe and sound and and just have it there and where you can sell it if you need it. All right,

00:21:09
KT: okay. Suze.

00:21:11
KT: I think this is going to make you a little feisty. I don't know if I don't think there's a name on this. Actually.

00:21:19
KT: I think she just wants to get your advice ready for this. Meanwhile. Hi. Good morning. This is the first time I'm writing in. I'm 62 years old. I'm an only child and my father is 81 years old. My mom has passed.

00:21:37
KT: So this is a father daughter question.

00:21:39
Suze: She's 62.

00:21:40
KT: She's 62, daddy is 81. Alright, ready. My father has some money in a bank account about $66,000. He doesn't know that. I know this.

00:21:53
Suze: We have problems right there.

00:21:55
KT: Wait this is already starting to give us a clue of where this is going. Ready. And he also has some CDs

00:22:01
KT: Which we have discussed years ago. I have some money difficulties right now. So I asked my dad for a small portion of my inheritance to pay off some of my bills like $10,000. That's a lot of money. I asked him if he could cash in his CDs He said no I'll have to pay taxes. And I said well if you're over 59 a half you won't have to pay any penalties to withdraw. He said absolutely not. I am not touching it. I won't touch it. The answer is no don't ask me again.

00:22:41
KT: Now her question to you is

00:22:44
KT: is this the truth?

00:22:46
Suze: Yeah it's the truth not to ask him again. No way. I think what you're asking me is it the truth about the 59 a half

00:22:56
Suze: that he won't have to pay any penalties to withdraw.

00:23:00
Suze: That's not the truth. 59.5 only pertains to what? To retirement accounts.

00:23:09
Suze: It does not pertain to certificates of deposits that are owned outside of retirement accounts. And yes there is a penalty. He's telling you the truth.

00:23:21
Suze: If in fact he bought let's just say he did five years ago a five year certificate of deposit

00:23:29
Suze: or he bought a few of them

00:23:31
Suze: and it was guaranteeing him in interest rate at that time for five years if he breaks it and he withdraws his money before five years is up for that CD matures. Yeah there can be a three month interest penalty. There can be a six month interest penalty. You never know how it works. However

00:23:51
Suze: here's what you're not thinking about.

00:23:55
Suze: I get that at the age of 62 you have $10,000 a debt and you're scared and you don't know what to do about it.

00:24:02
Suze: But I want you to think about your father

00:24:06
Suze: Who is 81 years of age

00:24:09
Suze: and the truth of the matter is who's going to take care of him

00:24:14
Suze: since mama, his wife now is gone.

00:24:18
Suze: And you see that he has $65,000

00:24:22
Suze: In a bank account. And you think that's a lot. That's nothing when you are 81, years of age.

00:24:30
Suze: And if you do have money in certificates of deposit,

00:24:34
Suze: that means he needs to feel safe and sound because it's not invested where in the stock market.

00:24:40
Suze: So it tells you something about your father that he's trying to make sure that he can take care of himself when he gets older.

00:24:49
Suze: So you shouldn't be mad at him. You should understand that.

00:24:53
Suze: And the truth of the matter is you need to come to grips with the reality. If he goes through all of this money and he doesn't have any money,

00:25:03
Suze: he's going to come to you hopefully to ask you to help him.

00:25:08
Suze: So you guys better get on the same side of the table here and support one another.

00:25:14
Suze: Now there are ways for you to deal with your $10,000 of debt. Go to NFCC dot org

00:25:20
Suze: And negotiate with them to take over your credit card debt, reduce it to 0% and put you on a five-year payment program. But there's nothing your father can do as he's getting older if he needs money and he doesn't have

00:25:35
KT: it.

00:25:36
Suze: So

00:25:37
Suze: no, he should never give you this money

00:25:40
Suze: while he's alive. And number two you need to be really loving and understanding about what he's going through

00:25:48
KT: because

00:25:49
Suze: She will be 82 one day as well and without money she'll know.

00:25:54
Suze: So you

00:25:55
KT: don't assume that he's lying to you? He just is being very firm and doesn't and wants you to be more responsible. That's all.

00:26:04
KT: Okay. Next question. In the same light, this is an opposite before

00:26:09
Suze: I keep interrupting you today. You know, it's interesting about that one. What if he had been lying if he had been line, what would you have done? What if my answer would have been? Yeah,

00:26:21
Suze: he's lying. No penalties. Nothing he can get at that money anytime he wants.

00:26:25
Suze: That would have changed my answer whatsoever.

00:26:29
KT: Okay, that's a good point. This next question, Suze from Tammy is in the same light of what we just read. But on the other side of the table, Dear, Suze and KT, I am inheriting a large sum of money. Is it okay to put some in my child's name?

00:26:45
KT: Will it hurt his chance for a scholarship towards college? You

00:26:49
Suze: know, a lot of you lately have been writing this into me, especially about if you buy I bonds in your kid's name. Is it gonna hurt them for a scholarship?

00:26:59
Suze: In most cases there's a really big difference between a scholarship and financial aid. A scholarship is based on the student's merits,

00:27:10
Suze: their grades, their extracurricular activities. Do they deserve a scholarship based on who they are and what they have done in high school

00:27:21
Suze: financial aid is based on

00:27:25
Suze: how much do the kids have in their individual names or in a uniform gift to minors act account

00:27:31
Suze: versus what you have in your name. So money that is in the kid's name or custodial account absolutely can hurt them for financial aid. So, but there is a difference, it does not hurt in most cases for scholarships. All right, KT,

00:27:48
KT: So this is my final

00:27:51
KT: email, but it's not a question. It's a statement and something I want to share

00:27:56
Suze: with you

00:27:58
KT: didn't I? You did everything right, Suze. But this is a great, great, great email from Cheryl and Cheryl. Thank you.

00:28:06
Suze: Sorry KT, I don't always do everything right. There are people who write in

00:28:10
Suze: who say I disagree with what you said and that's fine. You can disagree with what I said, I hear you and I'll write you back and I'll say I hear you, which means

00:28:20
KT: I understand

00:28:21
Suze: where you're coming from and I get that doesn't mean that I think I'm wrong,

00:28:25
KT: but

00:28:25
Suze: you never know. Sometimes I do think I'm wrong and then I'll correct it okay.

00:28:29
KT: Everyone this from Cheryl is going to justify that. You're definitely right on this particular topic. So Cheryl writes this and shared it and I want all of you to listen to this.

00:28:41
KT: Hi Suze and KT, I love your show and always learn something new and listening.

00:28:46
KT: I wanted to share with you that I don't have a living revocable trust and I know I need one fast.

00:28:53
KT: I was in the car with my son last night he was turning towards our street and 18 wheeler came barreling up the hill toward us and I said, oh my God, my son instantly looked in the rear view mirror. He yanked the car over, allowing the truck to barely squeaked by. All I can see when I close my eyes. Is this scenario had I been incapacitated, we could have lost our home because I'm the breadwinner in the family and in an instant life can change Suze. You've impressed this upon me and this situation really brought it home?

00:29:34
KT: Thank God for my son's quick thinking

00:29:37
KT: and at this point I'll be doing my living revocable trust today.

00:29:42
Suze: Why did you choose that one to read?

00:29:43
KT: Because I think that Cheryl finally got a real life wake up call and sadly none of you should have a wake up call, you should just do

00:29:54
Suze: wake up

00:29:55
KT: Yeah,

00:29:56
KT: just do it and put this in place,

00:29:59
KT: but Cheryl's you know near death situation really opened her eyes and the only thing she thought of was oh my God if I don't have my will and trust in place I would lose everything

00:30:11
Suze: but somewhere that touched you inside to read that. So Cheryl if you're listening thank God nothing happened. But I do want to say to all of you that this is a great email because nothing happened.

00:30:23
Suze: But too many times I'm reading too many emails

00:30:27
Suze: after. It's too late. So all of you, the reason that we created the must have documents

00:30:34
Suze: is that our documents. You must have.

00:30:37
Suze: I have so many podcasts on why they're so important. But again if you want to check them out, go to Suze Orman dot com slash offer and that's where you can get $2500 worth of state of the art documents for 99

00:30:53
Suze: dollars. You know what time it is? KT

00:30:57
KT: Quizzie Time.

00:30:58
Suze: Now this is an interesting quizzie and quizzie time everybody

 

00:31:04
Suze: is where I get to ask KT a question

00:31:08
Suze: and at the same time ask all of you that same question

00:31:12
Suze: KT, you have to wait before you answer so people can think about it. You like to jump in there, you little rabbit you and we see how much is KT learned

00:31:23
Suze: over all the years. That

00:31:25
KT: dosen't sound nice Suze. Alright. Read it, Read me the, let me read

00:31:29
Suze: that we're gonna be

00:31:30
KT: able to know.

00:31:31
Suze: Alright anyway

00:31:33
Suze: so

00:31:34
Suze: are we ready?

00:31:36
Suze: My husband and I retired

00:31:39
Suze: Ages 58 and 60

00:31:42
Suze: our home is paid for and we have no debt.

00:31:46
Suze: We both have defined benefits from our former employers that cover all of our expenses and travel.

00:31:54
Suze: We invest every month about $1,000 into a retirement account into stocks.

00:32:04
Suze: One of us wants to stop investing and instead deposit the amount of money KT that they're putting into stocks every month

00:32:13
Suze: to increase their savings for the eventual home renovation that they want to do.

00:32:20
Suze: Now here's the question.

00:32:23
Suze: One of us wants to keep investing the money.

00:32:26
Suze: The other one again wants to keep it safe and sound in a savings account.

00:32:32
Suze: So rather than taking the $1,000 which it is every month that they're investing in the market right now. One of them wants to continue doing that, the other wants to put it in a savings account and just keep it safe and sound for a renovation that they're doing.

00:32:48
Suze: They currently have $72,000 liquid in a bank account.

00:32:53
Suze: 10,000 of that is for the home renovation. They do not say how much the home renovation is going to be. Should they

00:33:03
Suze: given the markets are down here probably going to go down some more.

00:33:07
Suze: Should they continue to invest or should they put this money in savings simply to do the home renovation.

00:33:15
KT: Can they do a 50/ 50,

00:33:17
Suze: They can do anything. You tell them. Think about it. Think about it. Everybody. What would you tell them?

00:33:24
KT: Do a 50 50

00:33:26
KT: half of it and continue to invest in the stock market, which is going down. It may not recoup for quite a few years. The other half put it towards the renovation. Everybody's happy.

00:33:41
Suze: Obviously, if they want to do a renovation once you want to do a renovation sooner than later, you wouldn't really want to have to wait five or six  or seven years to do.

00:33:50
KT: I've got news for you. If what they have now is $10,000

00:33:55
Suze: Towards the renovation, but maybe the renovation is 20,000 KT. We don't know that.

00:34:00
KT: I was going to say there's not a lot. You're going to renovate for 10 grand and this is the prices these days. Right.

00:34:05
Suze: So you would have them do 50 50

00:34:07
KT: 50. Keep my my goal is keep them both happy. Let them

00:34:12
Suze: both be. They do say neither of us feels the need to be right or cares if we are wrong. We are just overwhelmed with the decision and need some direction.

00:34:20
KT: Do a 50 50. Everybody. There's your there's the answer, Suze. He's happy. She's happy

00:34:27
KT: 50 50.

00:34:29
KT: Put 500 on.

00:34:30
Suze: I hear you. I hear you. I got it.

00:34:33
Suze: (Wrong answer sound)

00:34:33
KT: you going to do? All right. She's going to tell him to put it in the stock market. You want them to put all that money in the savings? How come a

00:34:42
Suze: Few reasons? # one

00:34:44
Suze: money that you need within a five year period of time

00:34:49
KT: should never be

00:34:51
Suze: In the stock market. So even if it's $500 a month,

00:34:56
Suze: That's $6,000 a year,

00:34:59
Suze: That's over five year, $30,000 that very well could go to 15 or less, anything can happen.

00:35:08
Suze: So, if you know that you need money for a project

00:35:13
Suze: and you know that project is needed to be done or wanted to be done within five years and you have money sitting in other stocks and other things and you have a pension and everything is great.

00:35:27
Suze: I would just make it so that it was safe and sound

00:35:30
Suze: and that's what I would do and put it in savings.

00:35:34
KT: All right,

00:35:35
Suze: You still don't agree with that, Do you know?

00:35:37
KT: I was just trying to make them both happy the same way. They don't like people to feel secure. I like them to be happy.

00:35:44
Suze: Happy. Doesn't necessarily mean that it's right.

00:35:48
Suze: I mean, that's when you tell people like that woman who wants to go to her son's destination wedding,

00:35:53
KT: She could be

00:35:54
Suze: happy if she goes.

00:35:57
Suze: So you tell her, Okay, go

00:35:58
KT: that's why people

00:35:59
Suze: get into credit card debt because they want to feel happy when they make a purchase

00:36:05
Suze: and she's yawning here

00:36:07
Suze: and she's yawning? Are you kidding me? All right, that's it. I've had it. That brings us to the end. Let's

00:36:15
KT: go Suze, make me a coffee.

00:36:17
Suze: I'm not making you anything when you're yawning while I'm talking.

00:36:22
Suze: It reminds me of my radio show that used to come to every day and fall asleep. Was

00:36:26
KT: at the wrong hour

00:36:27
Suze: four o'clock in the afternoon. Every

00:36:29
KT: 4:00 need a little nap

00:36:31
Suze: during my radio show that I could see her

00:36:34
Suze: sleeping anyway. Alright until next Sunday or this coming Sunday. There's only one thing we want people to know when it comes to their money and what is it, KT?

00:36:43
KT: Okay, You all need to be safe. Strong and

00:36:46
Suze: secure. Alright everybody see you Sunday, Bye bye.


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Suze's Financial Strength Test

Answer Yes or No to the follow statements.

I pay all my credit card bills in full each month.

I have an eight-month emergency savings fund separate from my checking or other bank accounts.

The car I am driving was paid for with cash, or a loan that was no more than three years, and I sure didn’t lease!

I am contributing at least 10% of my gross salary to a retirement plan at work, or I am saving at least that much in an IRA and/or regular taxable account.

I have a long-term asset allocation plan for my retirement investments, and once a year I check to see if I need to do any rebalancing to stay on target with my allocation goals.

I have term life insurance to provide protection to those who are dependent on my income.

I have a will, a trust, an advance directive (living will), and have appointed someone to be my health care proxy.

I have checked all the beneficiaries of every investment account and insurance policy within the past year.

So how did you do?

If you answered yes to every item, congratulations. If you are working on improving on a few items, I say congratulations as well.

As long as you are comitted to truly creating financial security, I applaud you. If that means you are paying down your credit card balances, or are building up your emergency fun with automated payments, that’s more than fine. You are on your way!

But if you found yourself saying No to any of those questions, and you’re not working on moving to Yes, then I want you to stand in your truth. No matter how good you feel, you have some work to do before you can honestly know what you are on solid financial ground.

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