Credit Cards, Home Mortgage, Retirement, Saving Money, Stocks
March 14, 2021
Listen to Podcast Episode:
On this podcast edition of Ask Suze (and KT) Anything, Suze answers questions from Women & Money listeners Victoria, Monica, Diana, Jen, Jorge, Melissa & Jen, and Marybeth selected and read by KT.
March 14, 2021. Suze O, and KT's here, believe it or not on a Sunday. So welcome to the Women and Money Podcast, as well as the men smart enough to listen. Before we start, I just want to say it is March 14th. That gives you 17 days left 17 days until the ultimate opportunity savings account is no longer going to be available, unless I can convince them at the last minute to extend it. But because we aren't there yet. I have hinted at it, but nobody's really said for sure yet you've got to take advantage of it now, you just have to. And again, for those of you who may not know, just go to myAlliant.com. You put in at least $100 a month for 12 consecutive months. It's not going to cost you anything. There are no fees. Glob, blah, blah, blah. And at the end of the time, you get $100. That's a 16.7% return on your money, people you cannot afford to pass that up. I did it. KT did it. All of our friends did it. And you're going to make 0.55% interest on the money. Even if you can't put in $100 a month, a lot of people are putting in a whole lot more. But I do. I know, but do not. Of course, you did. But do not pass this up, because right now, until I can convince them, you better pray I can convince them. Because so many of you working. Well, let me tell you, KT, why? I want them to extend it. Maybe they'll listen right? Everybody is about to get their stimulus check. And when you get your stimulus check, what am I asking you to do with that stimulus check? I'm asking you to put it into a savings account at the highest interest rate you can get, which will be Alliant Credit Union. So that's why I want them to extend. Because I'm afraid that after March 31st is when a lot of people are going to get it. Their stimulus check, But anyway, fine. All right, KT, you owe everybody an explanation as to why I wasn't on the podcast on Sunday last week. Go on, girlfriend. Because we are back in the Bahamas. We're here. We're home. We're happy. It's beautiful. I feel for all of you that are stuck in snow right now all throughout the Rockies and our family in Colorado. But you know what? Suze has been working really hard, and I wanted her to come home. So, we're here. We escaped. Who knew? Right. I wish you had told me a little bit more about it, but that is besides the point. I'm helping her today. I said Okay. You do Thursday, Suze school. I'll take care of Sunday and we'll get back on track next week. So KT, well, now, before we start, I got to tell you what happened to me last week. Almost. What happened to you? Alright, now I'm nervous because usually I know everything that's happened to her, but we're on our podcast. Suze, do you want to share that? I do. Wait and tell me. And then I'll know I do, because you know how you always watch those commercials everybody about somebody signing on to a zoom meeting or whatever and then the camera moves and it goes down and then they're in their underpants. Okay, so here I am. And I'm to give a talk on Thursday night to, uh, I remember. So, what happened? So, there was a phone that was so it was supposed to be, I thought a phone conversation. And in the afternoon and again that evening for AARP, everybody. Alright, So I go on in the afternoon at 2:30 to just do a pre-meeting schedule of what's going to happen because it's live. And I wasn't dressed. Would you have on That was right after you had given me that little treatment on my back and on your bathrobe or your little Suze Orman shirt. No, don't tell me you were naked. Yes. Come on. I didn't have time because we were running late, and I thought, is this if this is true, then this is on. Zoom somewhere. No, wait, no, wait. Just listen to me. So now I sign on. And thank God my video is not activated until you activate it yourself. And I sign on and there's everybody in video format. And so, if you saw everybody who said, wait a minute. And if I had been in video format where you I had set the video to go on automatically, I would've been in big trouble. So, I'm just, you know what that would have been your one and only the bare truth, the naked truth about money. But I'm telling you all this story simply because can you just all make sure that if you do any meetings like that, you always set your video to not engage unless you yourself engage it? I just wanted to admit that to you. My goodness, I'm glad I wasn't there. I was in shock. KT. I've never been in shock like that before. I never do that. Of course, you don't. Okay, Go on. All right, here we go. We have some great questions today. Actually, I was saving some of these. Alright? Okay, Suze, this is from Victoria. I'm 41-year-old mom with two beautiful boys. My husband and I have been aggressively paying down our mortgage, but I've switched gears instead. And now I'm aggressively paying into college funds and Suze just for reference. The boys are seven and four years old, so given the market conditions and are 35 fixed-rate mortgage at 3.75%, it makes mathematical sense to me. Okay, this is Victoria. It makes sense to Victoria. The conflict is my husband doesn't agree. He feels I shortchange myself. He calls it mommy-itis. He thinks we should pay the mortgage off first, even with the extra payments. Were still looking at 20 years before that mortgage is paid off. So, she's asking, what would you do, Suze? It's very simple, Victoria. I would listen to your husband if I were you. And the reason is this. There's no such thing as a loan in retirement. How many times have I told you that? To make sure that you're okay, there are student loans. Who knows what the future is going to be in terms of college and universities and how kids are going to learn. So, if you're paying down on a home now, listen to me. Everybody closely. If you're paying down on a home that you know you are going to keep for probably the rest of your life, your goal needs to be to own that home outright. By the time you retire. Victoria, you told me you are 41 years of age. You say you still with paying extra on it will not have it paid off for another 20 years. That puts you in your sixties are very close to possibly retirement. So, I want you to continue to pay down your mortgage. Just that simple. As long as you're going to stay in that house for the rest of your life. Go on KT next, A good next one is from Monica. Hello. I want to move into a new house. I'm 55 years old. I'm a federal government employee for over 37 plus years. I have about 10 to 15 years till retirement. I'm not married. Nor do I have children. I do have credit card debt. It is a good idea to move into a new home in the next year or two. Well, Monica depends when you say move into a new home or you're saying move into a new home where you rent or move into a new home where you buy. If you're talking about moving into a new home where you buy, you are so denied. I can't even tell you. Now, why do you think that I'm denying you? Why am I denying her? KT, what's the one thing in this email? Credit Card Debt. KT, got it right. When you have credit card debt, that also probably means you do not have an emergency fund. It also probably means you do not have 20% to put down. Because if you had money, you wouldn't have credit card debt. So no, no, you are denied. Next question, KT. Okay, this is from Diana. Hope all's well, and everyone is healthy. Love you girls. I'm 40 years old. I am happily married to my husband. For 11 years I've been with him for 20. We have three young kids. Since the beginning, we've kept our credit cards separate. I have my credit cards. He has his. We have about $60,000 in credit card debt, collectively. Before you go and kiss your question, why did you choose this one? What was the title of this one? It said I feel like the financial abuser, so I was curious. Like what makes her feel like a financial abuser when she opens the line with their happily married that I would like going. How are you happily married? So let me let me get to the cut to the chase, so I'll give you the background. So, we have about $60,000 in credit card debt. Collectively, we owe 142,000 on our mortgage in about 13 years. It should be paid off. We have no car loan, no school loan. We have 21,000 in savings, which were also growing slowly. And I have a Roth with $23,000 in it. Now, this is where she's feeling a little bit guilty, Suze. Her husband has no retirement account. She's asking what should she do to help make him secure with his own retirement account or Roth? So, she's asking, do I pay down the credit card first? Do I lower my contribution to my Roth? Do we split it up? What do we do? What should she do so that she no longer feels like she's being a financial abuser? Does her husband have a separate account? And she has a separate account, or do they have everything in a joint account? Okay, so the answer, Suze, is they have a joint account checking account. She wants to know. How does she separate those funds? Right. So? So, Diana wants to know a whole lot of stuff. Should she continue to save in her Roth? Should she continue to build up her emergency fund? How does she separate her joint checking account? KT, where in this email, does she even say anything other than the title about? She doesn't want to be a financial abuser. So, she's asking, she said, especially with Covid-19. What order do I do these things in the future? I am so that I'm not accused of being a financial abuser. I want him to feel secure and have his own money, which he has access to and in no way, shape or form, stop him from using it. Please help me, Suze. Oh, gosh, Diana, you really need to listen to me. First of all, financial abuse is anything other than who you are. A financial abuser doesn't want their spouse or their partner to have access to credit to them money to anything they don't want that person to know anything about their financial situation on any level. A financial abuser usually demands that if their spouse or partner is working and they bring home a paycheck, that they get that paycheck. You know the spouse isn't allowed to see that paycheck. You are so far from a financial abuser, it's not even funny. So, you have to get your head on straight here. But I will tell you, you are a financial abuser, but not to your husband, to yourself, you are a financial abuser to yourself, because number one, you have $60,000 of credit card debt and you have to feel horrible about that. But rather than writing in and really just asking about, how do I get rid of this credit card debt? I feel horrible, whatever it may be, you are writing me about making sure that your husband is okay, your husband is going to be fine if he wants a Retirement account. He has everything that it takes for him to open up his own retirement account if he wants to. If you want to help him, do so, you can. But your solution here isn't in what do you do first, whatever. Your very first solution is, why do you have $60,000 a credit card debt? I have always found when people feel less than they spend more than. And, I don't like that you even feel like you're a financial abuser. And it makes me worried that one of the reasons that you have credit card debt is because you spend money on him and everybody making sure everybody else feels great and they're taken care of so that you don't have to feel that way. So, there's no simple way to answer these things. What you should do first. Because how many times have I said you cannot fix a financial problem with money? I don't like that you have $60,000 of credit card debt, work on that one first girlfriend. Okay, KT, I agree with you. That was good advice. Why does it crack me up every time you tell me that you agree with me? And that was good advice. Did you agree with me on Bitcoin? I don't want to talk about Bitcoin. Every Bitcoins almost at $60,000 a Bitcoin, did it go up that much. Did you agree with me on Bitcoin. I'm not going to talk about that. I don't understand that. I know you don't understand that. We have to go to Suze School again. And by the way, those of you that feel like I do, go back and listen to January 31st Podcast. I've listened to it 10 times. I still don't get it. But that doesn't mean everybody, that it was a bad podcast was a great It just means KT still has a block against this. A bit block. You have a bit. You have a big bit block. Okay, this is from Jen. Now, I wanted to say how much I love the podcast, especially when you're both on it. So, today's a bonus Sunday for you, Jen. started. KT is on it. So, he said it's the first thing I listened to in the morning, and it starts my day happy now. You're going to have a happy weekend. So, this is for this is for you, Suze. Regarding will entrust my husband and I have a last will and testament. A living will. Health care, power of attorney and financial power of attorney that was created over 10 years ago. But nothing much has changed as to who we want designated and how we want our assets divided. However, Suze, at the time we met our lawyer, we only had our primary resident. Now he recommended that a trust wasn't needed as the title in the JTWROs. But now we have a rental property. Is the trust needed? Can we just use the trust portion of your willing trust? Kid? She's getting really mad. Jen, this might not be a happy day for you. Can we use a portion of your willing trust kid for the trust? Will this override the current documents we have? Suze, you better straighten her out. Straighten out Jen. And, it's not Jen that I'm aggravated at. I'm so aggravated at your lawyer right now. I can't even tell you. She's steaming, Jen, you know why KT loves that so much? Because I'm not steaming at her. I'm steaming at your lawyer Jen. Alright, everybody. Time to go to Suze School. KT What does JTWROs mean? Come on. You can't look at anything. Don't try looking anything up. What's it mean? You don't know? Just say you don't know. What are you looking for? I don't know. It's too many initials for me. She's sitting here. Everybody looking at the J. C. If there's a hint in here, there's not a hint. Just It's okay. I have no idea what that means. Title in JTWROs. All right, KT, how do we own our property jointly? Joint tenancy and right of survivor ship. Well, they could have shortened it here. How she is. Here's the thing. Yeah, when you own a property to people and you want the other person to absolutely get the property, if you die, you own it in joint tenancy with right of survivorship. That's what those initials stand for. So, KT, if I die, the house automatically goes to you without probate and vice versa. That's great. However, what if I don't die? KT, what if I am totally incapacitated and you need to sell the house? You need a house that has one floor. Whatever it is the question is, we own an in joint tenancy with right of survivorship. So, if we were to sell the house, both signatures are needed. Forget about death. Forget about we're here right now. Can you sell this house if we only own it in joint tenancy with right of survivorship? No. Why she doesn't know everybody. Do you know? Because yeah, go on. You don't know. You just flunked the quizzie. Okay, here's what everybody needs to get when you own a home and joint tenancy. Jen, you listen to me very carefully and everybody else needs to understand this. Including you, Miss Travis, is that if you only own a house in joint tendency with right of survivorship and one of you becomes incapacitated so you don't know who you are. You don't recognize your spouse, and the spouse needs to sell, or the partner needs to sell the house. It requires two signatures. Since I can't sign KT, you can't sell this house. So, you're going to have to go down to probate court. A lawyer is going to go down and file for a conservatorship for me, and then once I'm designated incapacitated and a conservative ship. Then you can sell this house. But you, KT, don't have to worry about that because this house is held in joint tenancy with right of survivorship in a trust, right? I know that. That's why I was looking at you that we’re good. But you, KT and Suze have trust. But you need to understand why, if all we had was that you would not be good. So, Jen, because your attorney is just a Ding Dong bell. Seriously, how could he or she not think about? That there are other things that happen in life other than death and incapacity is a big one. And sure, maybe you have a financial power of attorney for finances or whatever, but most of them are null and void the day that there is an incapacity. So not only do you need a will, an advanced directive and durable power of attorney for healthcare, a financial power of attorney, you need a living revocable trust and your house should be owned in trust. Your rental property should be owned in trust. If you wanted to, you could own your rental property in an LLC and the member of the LLC, the limited liability company would be the trust. So that was the worst advice that you could have gotten from an attorney simply because you can avoid probate because you own it and joint tenancy with right of survivorship. You don't need a trust, but that's only if you die. So, if I were you, I would go to suzeorman.com/offer, and I would get that must have documents. Not one other thing I'm just going to say is that on March 27th and March 28th, I am going to be on HSN just for two hours and for $69 the exact same price that you're going to pay to get it online. They must have documents at the suzeorman.com/offer. You can get it at HSN, but it will include a copy of my New York Times Bestseller, the Ultimate Retirement guide for 50+. You'll also be getting the audio version, the online version of it. The Must Have documents, as well as the $100 offer that Alliant is giving right now. But remember, if you happen to get it on HSN right now. That offer is going to be good through December 31st. So, it's just something for you to think about again March 27, 28th. And by the way, if you get the Must Have documents, no, you cannot just do a will. You have to do all four of the documents because they're all must have documents. And I don't want somebody just doing a will when it's probably the biggest mistake they will ever make. Girlfriend, what's your next question? Hold on. The most important part of the answer. You don't need that lawyer, Jen. That's right, Girlfriend, that’s right. Dong Bell. Okay, this is from Jorge, Suze. He says he's never done anything like this. But here it goes. Like what? Being a man smart enough to listen and asking the question. So, he said, my in-laws are living with me and my wife at this current time, they recently sold their home. They made about 140,000 and they also have some money saved, maybe 10 or 20,000. We live in Fort Worth, Texas. My father in-law is disabled and gets about $1000 a month. My mother in-law gets a little bit for being his caretaker, maybe 2 to $300 a month. However, she's going down the same path as far as being disabled. They have no other source of income. They've been living with us for about 3 to 4 months. We've modified our home and we do not charge rent. So, here's the plan they came up with. They want to find them a home in the price range of about $100,000. Is there any type of investment Suze, such as an annuity to put them in to put, let's say, 30 to $50,000 in and get a monthly income? Or do most annuities require more money to get monthly income? Jorge, such a good boy taking care of Mama and Daddy. Um, here's the thing. Why are we even doing this at all? If you modified your home for them to be living with you and you're not really charging them rent and anything and obviously if you modified your home, you possibly did it with the hopes that they would just stay living with you possibly yes, possibly no. The key to everything here is that Mommy right now is taking care of Daddy. And Mommy is also going down the same path as Daddy. So, I just got the sense that it's possible or hey, neither of them may be alive for a whole lot longer, or they really may need serious help even outside of what Mommy can provide for Daddy right now. And obviously Daddy can't provide it for Mommy. So, if I were you, I would not be buying a home right here and right now for $100,000. Because as they get older, who's going to take care of them? There are expenses with the house right now. They're living with you, rent free and you're taking care of everything. But when they have their own home, they're going to have to pay utilities. They're going to have to buy food. They're going to have to do all of these things. And I just don't think that's wise. I personally would be saving the money. Just keep it safe and sound in a high yielding savings account. Seriously, put it in Alliant Credit Union. I'm not kidding, Right. And at least you know you could do $100 a month and get that extra $100 as well in 12 months, or just get the 0.55% interest rate on it, the highest you're going to find really anywhere. And let's see how they do health wise. In answering your question, no, you do not need 30 or 50,000 or more to go into an annuity, but an annuity that is going to give you income right now an immediate annuity or a single life annuity or whatever it may be, the income is going to be so small. It's not even funny. So, the problem is when Mommy and Daddy both die, there go the annuity. So, if they die shortly and it doesn't have certain provisions in it, then there's all that money is going to go down the drain. I would rather see you put it in high yielding savings account. And when they need money, you give them a little money here, a little money there, you know. But I would be doing an annuity in their particular situation right here and right now. While you're looking at me like that, I agree with you and I was also thinking she doesn't know. I was thinking they may both very shortly need additional care. Yes. So, can they use that money to help subsidize hospice, for instance, to help out? Well, they wouldn't necessarily have to subsidize hospice. And I think everybody, you should understand. Hospice isn't just coming in and giving you a shot so that you die, you know, in peace. Hospice also happens to come in to help you with little things around the house. Like there's all kinds of benefits giving you the right kind of bed, you know, washing you, bathing you. My aunt and uncle had hospice coming in for, like, a year or two before they died. And it helped my aunt so much, who at the time was the sole caregiver for my Uncle. So Yeah, KT, they can use that money for anything they want, obviously, but I wouldn't be putting it into a house that has upkeep. Things go wrong, things break. Not here. Yeah, I think the house is a mistake too. Okay, next question. This is from a partner, Melissa and Jen. All right, You ready? So, the last Jen didn't go so well. I said my partner, Melissa, this is actually from Jen and it's about her and her partner. So Hi, Suze. My partner, Melissa and I are looking to start a small business. We have the capital available to us. We're just unsure what to do with it. Neither of us have a degree. We're looking for innovative modern ideas for a lucrative small business venture. Ideas that do not come up when I google those same words, please tell us your thoughts and again now this is interesting, Suze, she said. And it bears repeating. We are not going back to school for a degree. I don't know why she's so mad about going back to school. Who wants to go to school? You go to school, you rack up all the student loan debt. I can't agree with you more on that in. Jen and Mel, what should they do? So, but Jen, here's the problem. You have this money and I feel like it's like burning a hole in your pocket. People who go into business go into business, and they succeed at that business because they have this burning desire and love for what they want to do. They know what they want to do. They have figured it out. They know the cost of everything. They're just not around saying, Oh, I have all this money So I'm looking. How can I start a business? I would be looking at the Internet for anything I would be sitting down with Mel and I would be saying, what is it that we love? What is it that we're good at? What would we like to do for the rest of our lives? What could we do that would help humanity? You know, what could we do that we want to do, not what's lucrative and what's innovative and what the Internet says and what Suze Orman says, I don't think so. So slow down, because can you just look at what happened last year? You could have taken this money. You could have started a business. Now the pandemic starts, and now your business is absolutely closed. You've lost all the money, possibly. And now what do you do? So be careful and do not use any of this money unless you already have at least a 12-month emergency fund for both of you, that you don't have any credit card debt, that you're fully funding your retirement accounts. Everything is how it should be. No car loan, debt, anything. And then if this is just extra money, leave it until you know what's calling you. Not what you're calling. Both of you, both of you. Um, I wouldn't be doing anything right now. Not yet. You find something you both want to do that you love. That's the number one goal working, like working on Sunday for KT. No, but I love what I do. I always loved what I did and do. And so did Suze. That's why we're both successes. Have I told a story about Barbara Walters, I must have. Right? Right. Well, yeah, the question she asked you why you're always happy. Yeah, she asked me. And if you haven't heard this before, I'm just going to repeat it. I was sitting on the view and we were about to start because it was live, and Barbara Walters looked over at me and said, Suze Orman, why are you always so damn happy? And my answer to that was because I don't do anything that I do not want to do, like KT today. All right, Go on. Suze, one last question from Mary Beth. I listened to your advice on Roth IRAs, and I asked my employer if they offered one. And they do. I did switch. They don't offer a Roth IRA. They offer a Roth 401K or 403b. But go on. I did switch from my 403 b. My question is, what do I do with the 403 b? The company does not roll over the 403b to a Roth and good for the company. A lot of companies Mary Beth will actually allow you to transfer. It's not a rollover, but transfer money that you have in your employer's 403B plan, which is money that you've never paid taxes on into their Roth 403b. But when you do so, you will owe ordinary income taxes on all the amount of money that you transferred. So just leave the money that you currently have in your employer's 403B right there. Your new contributions should be going into your employer's Roth 403b and it's just that simple. Hi, KT. You know what time it is? Time for my quizzie. You already flunked it twice today. That's not nice, Suze. It's true. No, I got one right. Kind of. All right anyway, dear Suze and KT, are you ready for this? I am a 29-year-old man, smart enough to listen. His name is Anthony. His older brother has two children in Florida. And he contacted me today asking for me to buy raffle tickets for his kid's school for a fundraiser. The tickets are $10 apiece, and I told him I can only buy one. He quickly got upset with me and used the quote, “You always brag about saving money with Suze Orman”. I told him I could afford one, but he was angry because only one kid would get a ticket. It's true. I do have money behind me, but I need to maintain this, as I am a teacher in a pandemic. And there is so much uncertainty. Should I give my brother $20 or say no out of love for myself? So, everybody here's the question before KT answers because this quizzie is for you as well. Should Anthony give his brother out of guilt? Because he doesn't want to, $20 so he can buy two tickets for his brother's kids or stick to $10, which is all he wanted to do and just buy a raffle ticket from one kid? What would you do? Think about it. Think about it. KT. Anthony, I have a great idea for you. First of all, you are so right I can't begin to tell you. Stick to your guns. Listen to Suze Orman. Save your money, buy one ticket, but give your brother a little idea. Say, Listen, brother, I love the kids. I want my nephews to flip a coin and whoever wins gets the ticket, done. It's, you know, Suze, as is saying, or Suze's dad had to saying better to have 50% of something than 100% of nothing. There you go. That's my answer to your brother. Ding ding, ding, ding KT. That is a brilliant, brilliant answer. However, if it were up to me, I wouldn't be giving them anything. But that's besides the point. I'll let it just sit with KT's answer. Are you kidding me? Anthony's brother. How dare you! All right, KT, that brings us to the end. Guess what I'm doing this afternoon. What? I'm going fishing, Suze. With Coehlo, I'm going to catch us a fish for dinner. I'm going to catch delicious fresh fish. Tell everybody why I'm not fishing with you. Suze still is not able to go out on the boat. It's very rough here. And we're in wahoo season, which is very dangerous fishing. And her doctors are asking her to be patient and calm and be very, very easy on her arm and just rest, continue to just let herself feel it's a long process and we're just dealing with it. It could take over a year, and it's very sad to think that that healing takes that long. But listen, we're lucky we have each other. We're optimistic. We know that that year will come and go as quickly as 2020 did. She will be out there fishing better than I could ever try in my lifetime. Anyway, I hope you catch fish taking. We will. All right. Okay. Everybody knows that we love you. And, we'll talk on Thursday. Alright, Bye Bye now.
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