And good evening.

You've got More Than Money.

You've got Gene Dickison, your host, your personal financial advisor, 780 years of experience.

How is that humanly possible?

It's just one of life's great mysteries.

It's a lovely thing.

So welcome, welcome to More Than Money.

If you're a loyal listener, you know exactly how this works.

Momentarily, we're going to be answering all kinds of questions that you've sent in.

Absolutely fantastic.

Thank you so very much.

If you're joining us for the very first time, wherever you may have found us, however you may have found us, you are absolutely welcome.

The next half an hour are questions and answers about financial matters, very, very important to your, your friends, your family, people in your community that have already found our show and are trusting us to give good counsel, give them good advice, and we appreciate that, very, very much.

Investments, of course, estate planning perhaps, businesses, we do a lot of investigation around how to start or run, life lessons around running a business.

Fantastic stuff and all available to you for the low, low introductory PBS price of absolutely free.

All you need do is perhaps pay attention, maybe jot down a couple of notes to get you on track.

And I think you'll find the next half hour will go very, very quickly and you'll have an awful lot of education.

If my intellect is spot-on and mildly entertaining.

Any entertainment, I'm sure, was simply an accident.

Before we go to questions, I want to send a very special thank you out to my audience.

You folks are amazing, not just in your willingness to share your concerns, your questions, your observations about your financial lives, but your gratitude.

You are fantastic.

I have lost track now of how many emails we've gotten from listeners and viewers in so many states.

Most recently, a gentleman from Delaware said, Hey, I'll be honest with you, I got my own financial advisor.

Don't really need any help.

I just want to say thanks.

Well, what a wonderful thing to do.

What a wonderful, generous thing to do.

We offer up all this education and information in that spirit, and you're returning it right to us.

It is one of the reasons why we are so very grateful to have the opportunity to serve you.

Let's give you a demonstration of how that service looks.

We go to our financial correspondent, Megan.

How do we start our evening?

- Hi, Gene.

Our first question says, In about two years, I will reach the age where I must take a required minimum distribution.

I have, depending on the market, roughly $100,000 in a Roth IRA and $450,000 in traditional IRAs.

At this time, I do not need the extra income which the RMD would represent and I do not expect to need it two years from now.

My family income is in excess of 140,000 annually.

My only bills are internet and cable, cell phone, utilities, my credit card purchases, which I pay in full every month, gas and groceries.

As of this point in time, I expect to roll over the RMD into some other investment, most likely into an already existing non IRA mutual fund account.

I'm wondering from which type of IRA should I take my withdrawal from first?

Thank you for your help.

- Oh, it's my pleasure.

And thank you for sharing your concerns, your questions.

It's an interesting one for a couple of reasons.

And I'm going to cut right to the chase.

The question that you're asking is...

I understand why you're asking, but I think the answer is going to be surprisingly simple.

You don't take any money from your Roth IRA, and if you are fortunate, if you are blessed, if your retirement unfolds the way I pray that it will for you, you will never touch your Roth IRA money.

Roth IRAs do not have required minimum distributions.

Roth IRAs don't have any required distributions at all.

You are never required during your lifetime to take money from your Roth IRA.

So in the world that More Than Money lives in, if you don't need the cash flow, you let the Roth IRA continue to grow for as long as you possibly can.

As a young person, if you're two years away from RMDs, you're 70, RMDs start at 72, currently, that could change in the near future, but currently, that means that you've got 20, hopefully 25, maybe 30 or more years in retirement.

So allowing your Roth IRA to continue to cook, continue to grow over the next 10, 20, 30, 40 years might end up being your ace in the hole.

It might end up being the money you go to when you need at the latter stages of your life, you need extra income.

But based on what you've explained to us, I don't think that'll ever happen.

If I give a generous estimate to your expenses, your income's 140.

My guess is that your expenses are less than 60, so you will have a tremendous amount of additional accumulation during your lifetime.

I don't believe you'll ever need your Roth, and you certainly don't need to take required minimum distributions.

I would also suggest that if indeed my numbers are even roughly correct, you're only going to spend 60 or 70 or 80 of a 140 income, then taking the RMD and bringing it out, paying the tax, of course, bringing it out on what will be roughly half a million dollars, your RMD is going to be roughly 20,000 a year.

You take the 20 out, you pay 5,000 in tax, you put the 15 back into an investment.

I'm not sure why you would do that.

I'm not sure why you would go through that exercise, give the government 5,000 bucks and just keep piling it up when you have more than you need.

I would strongly suggest that you sit with your tax professional, perhaps your financial adviser, perhaps both, to discuss what is called a QCD, qualified charitable distribution.

It allows you to send your RMD directly from your IRA to a charity or charities of your choice.

You don't pay any income tax.

They don't pay any income tax.

You don't have to worry about reinvesting money that will just be piling up anyway.

And you can benefit some tremendous organizations of your choice.

Really, really important in my mind that the motivation for doing this is not just saving on taxes.

It's a nice motivation.

And in my world right now, it's very motivating.

But choose organizations that you have a connection to, might be a church that you're very committed to, that you attend.

It might be an organization that cares for animals because you love animals.

It might care for the needs of military vets because you're a proud supporter of military vets.

The list goes on and on.

But you can, in my opinion, more benefit yourself, have a greater benefit from your RMDs in your retirement, by helping others, by supporting organizations that you care about than you might have by paying a lot of tax and letting it stack up for someone else to take over when the good Lord calls you home.

So consider that meet with your tax professional, explore your options.

And of course, if you want to circle back, gene@askmtm.com obviously works really, really well.

Megan, great start.

Great start.

What do we have next?

- Our next question says, My mother passed away in 2009.

As executrix of her estate with a revocable trust, I have held on to many paper files, including trust documents, tax returns, personal and trust, Medicare and medical records, property records, disbursements from investments, sale of bonds, property tax records, etc..

I do not know what I must keep and what I can now shred.

I also need to know how to prevent my house getting tied up in probate for my three adult children who are listed as beneficiaries on all bank and investment accounts.

Thank you.

I really appreciate your help.

- Well, bless you.

Your first answer, as detailed as it was, is the easiest of the two.

What do you need to keep from the paperwork from settling an estate that is now 12 or 13 years old?

Nothing.

You can shred everything.

I would caution you to make sure as you go through those documents, and that you do go through those documents, that you pull out anything that might be of sentimental value, anything that might be of maybe inspirational value or educational value.

It might be deeds that track the owners of a home that you grew up in.

Those kinds of things.

It might be photographs.

There are often things that are dropped into files while you're working so very hard to settle an estate as executor that while they may or may not have been necessary, they can be personally valuable.

So make sure you go through the files very carefully and then shred it all.

There's absolutely no legal reason, the IRS is not going to challenge anything, any inheritance or beneficiary challenges are long past, so you can shred it all.

I will say that if it's a significant amount of shredding, one of the things that has pleased so many people over the years is that our More Than Money world headquarters, which is located in the Holy Lands between Bethlehem and Nazareth, here in Pennsylvania, for folks who are close to us, we have a shredding service.

So you can drop that off at no charge.

If it's just a small amount, of course, your personal shredder will do just fine.

But I suspect, I fear it's boxes.

Bring them over.

We'll be happy to help.

Now, avoiding probate.

Not always the most necessary thing to do and not always the most beneficial thing to do.

For your home, the typical way, the traditional way of avoiding probate is to take the kids' names and add them to the deed to your home.

So, in essence, they become joint owners with you.

It is referred to as a JTROS ownership - Joint Titling Rights of Survivorship.

Rights of survivorship.

You get the idea.

So that when you pass, they automatically, the three of them automatically acquire your interest.

And then that then becomes their home and there's no probate.

But there are some income tax issues that you may not appreciate, that you may not anticipate, and once you know about them, you may wish to avoid.

Most homes - your home, for example - when we have these conversations, 99% of the time the house is going to be sold.

After your passing, the house is going to be sold.

It is rare these days that children or grandchildren want the home to move into.

Could be an exception.

The exceptions are typically adult children that need care, adult children that have always needed care and attention, and it's their home.

In some cases, children have moved home to care for an elderly parent.

And of course, that's a case where you want to keep that in the family.

But a huge majority, the home is going to be sold.

If you gift it to them, adding their names to the deed, you are exposing them to the potential for an income tax, a capital gains tax that could again potentially be significant.

A lot of tax that if you don't put their names on the deed, they would avoid.

There's an item called a stepped-up basis.

When I inherit a property, I inherit it as if I paid full market value, the date of death of the person who has bequeathed it to me.

So you, as mom, if your home is worth 250, you and your husband perhaps bought it many years ago for 50, 200,000 of profit.

If you add their names to the deed and you pass away, they're going to pay tax on $200,000 of capital gains.

If you bequeath it to them, if it goes through the will and probate, they will pay no income tax at all.

So I would strongly suggest that you sit with a trusted, experienced estate planning attorney who can go through these options with you, explain the pros and cons.

There's no perfect solution.

Explain the pros and cons and see which one best fits you, because your circumstance is your circumstance.

We're not talking about a textbook.

We're not talking about a rule of thumb.

Not talking about a general, generic kind of guideline.

We want to make sure that whatever decision you make is specifically and appropriately correct for you.

I hope that helped a bit, and God bless.

Megan, fantastic questions so far.

Are we going to keep the streak alive?

- Yes, Gene, I think we will.

This one says, I am a single 72-year-old woman, no dependents or children, who is employed part-time.

I pay for short and long-term disability through my employer.

I'm wondering, should I continue coverage or can I stop it?

- I'm fearful that my answer is going to be disturbing.

I'm prayerful it's not.

I'm prayerful that we will discover that this is not exactly what I fear that it is.

But I will give you my fear first.

My fear is that your premiums that you've been paying for this disability protection have largely been wasted since you turned 65.

That's my fear.

My fear is that you've spent money for the last seven years that you should not have.

My prayer is that I'm wrong and that the disability company that you are dealing with, it sounds like you're going through your employer, sounds like it's a group disability plan, actually does provide disability benefits for someone who is over age 65.

But that would be very, very unusual.

Group disability plans, short and long-term, typically mature, end at age 65.

And the theory has always been, we're not going to give you disability because you were going to retire anyway and/or you're going to get Social Security and/or at that age, if you are disabled, you'll get Social Security disability.

So the disability companies tend to cap the age at which you can make a disability claim at roughly 65, particularly, particularly on group employee benefit plans.

Individual plans may be different and may be more customized, but in this case, if it is indeed a group benefit plan, my fear is seven years you've been paying no premiums or you've been paying premiums you should not have.

Now, assuming that is the case, I'm going to circle back to a recommendation here in a moment.

But keep in mind, at 72, hopefully you're already collecting Social Security because Social Security maxes at age 70.

So there's been no reason to not take Social Security since age 70.

Hopefully you're already taking that so you've got a base income.

Hopefully you've got retirement plan, a pension plan, something that will supplement your income so that even if you were to become disabled in some way, shape or form, you would have a steady stream of income that would pay your bills and that you would be financially secure.

That's my hope.

Now, let's talk about the premiums that have been paid for seven years that I fear... And the only way to confirm this is that you will go to your employer or the benefits administrator.

It might be internally, it might be your HR director, or it might be the person that they deal with at the group benefits, what, coordinator through the group benefits company, the insurance company.

You're going to go to them and say, Hey, if I get disabled today, what's my benefits?

And they're going to say, Hey, we looked it up and geez, you're over 65, you don't get anything.

That's when you get a little bit snarky.

And you don't have to get real snarky, at least not right away, but a little bit snarky and say, Well, I've been paying for this stuff for seven years and nobody said a word.

I expect, I expect I will get all those premiums back.

That would be my approach.

Little snarky at first.

If they gave you a push back, maybe a little snarkier.

And ultimately, if they're not going to be cooperative, if indeed your coverage ended at age 65 and the insurance company has been collecting for seven years premiums they are not due, for which you got no benefit... Let me think.

The Pennsylvania Department of Banking and Security, DOBS, Banking and Security.

Oh, yeah.

They cover insurance agents, too.

That would be a very interesting case.

The Pennsylvania Department of Banking and Security, they're very, very interested in any scenarios that take undue advantage of senior citizens.

They are very consumer protective.

They would be very interested.

And I think the last element of snarky, if they don't cooperate right away, is just the suggestion - I think I'll probably just go to Harrisburg and talk to the insurance commissioners and see what happens there.

I think you'll be just fine.

Please circle back.

Please let me know exactly how that worked out.

I pray that you have coverage.

I pray you never need coverage.

I hope that your health stays fantastic, right on through the entirety of your life.

But make sure that we get this squared away.

And in my opinion, of course, you stop paying those premiums immediately and spend them.

Have some fun.

Have some fun.

Meg, fun for us is answering questions from our audience.

What do we have next?

- This question has a couple of questions in it.

So I would get your pencil ready if I were you.

It says, I'm listed as the executor on my 89-year-old widowed mother's will.

She has the following accounts, all with named beneficiaries - brokerage accounts, IRA bank accounts, qualified terminable interest property and credit shelter trusts.

Her holdings are substantial, but well under the federal estate limit.

She does not own a home or a car, just some furniture and personal items.

Ideally, her estate should avoid probate.

However, it has been recommended that she open an account with no beneficiaries and fund that with enough money to pay final expenses and Pennsylvania inheritance tax.

This account would be large enough so that probate would be required.

My questions are, one, what do you think about the need for the account without beneficiaries to pay expenses and inheritance tax?

Two, won't probate be required just because of this account greater than $50,000?

Probate has a reputation for being cumbersome and slow.

Number three, what happens if distributions from the accounts with named beneficiaries are made and later it is determined that there is not enough money in the non beneficiary account to pay the full inheritance tax?

And lastly, one of the trusts has a large long-term carryover loss that I'm told will get distributed to her heirs.

How do the heirs receive this and make use of the losses?

Thank you for your help.

- Well, good for you.

You're planning, you're getting your ducks in line, and I'm sure your mom appreciates your support.

At 89, getting your ducks in line is a, is sometimes a challenge, but a necessary one.

And planning for the next phase is an exciting one.

Hopefully one that she's at peace with.

And having you to help, I'm sure, helps her to be even more at peace.

It sounds like you've done a lot of tremendously positive things.

Indeed, having so many assets, so many dollar, the dollar amounts, large dollar amounts that will be passing directly by beneficiary means that the estate could be largely bereft of assets.

On the on one hand, sounds great.

No probate.

On the other hand, there's still going to be estate taxes, Pennsylvania, there's still going to be final expenses.

There's still going to be expenses to settle the estate, whether they're legal, accounting, as the executor you are, whether you decide to take it or not, you are entitled to be paid for your services.

So all of those things need to be paid for.

A tax professional and perhaps working with a trusted, experienced estate planning attorney, should be able to calculate very, very precisely the kinds of numbers that should be in this account, this probatable account.

I want you to kind of step back for a second about the probate account or about the probate process as being termed like the boogeyman.

It's painful.

It's dreadful.

It takes forever.

None of that needs to be the case.

None of that needs to be the case at all.

Working with the proper legal counsel, proper tax professionals, estates, large and small, complicated and not, can be settled very efficiently and in a relatively short period of time.

And they should be.

Yes, there have been attorneys in the past.

Yes, there have been attorneys.

Perhaps there are some that still exist that tend to drag things out.

That's not the probate process.

That's the attorney you choose, you chose.

That's the business model that they have chosen - We're going to charge a large fee and we're going to try to justify it by making it a six, nine, 12 months, 15 to 18 months travail, where if it were done efficiently, it might be a two, three, four month process.

The fact that your mom's estate is going to largely be distributed before we get to this account means that no-one's going to be terribly inconvenienced if this last block of money, most of which they're not going to get anyway, because it's going to go for expenses and it's going to go for taxes, no-one should get their knickers in a twist about having, I'm picking a number out of thin air, $100,000 in an account that's going to be distributed over somewhere between three months and a year.

The probate process should be simple, should be very direct, particularly as we're describing this estate, because this estate will end up being largely, mechanically, largely done.

There is very little for the legal counsel or tax professional to do other than file the appropriate estate tax returns, the final income tax return, etc.

So please don't think the probate is the boogeyman.

It will be of no inconvenience whatsoever to the beneficiaries since this is money that is not going to them in any way, shape or form anyway.

A little bit extra paperwork.

A little bit extra work indeed, yes, as the executor.

But in general, I think a very reasonable trade off.

What happens if there's not enough money?

The executor is then required to go back to the beneficiaries and carve out, claw back some of the money that they have been, that has been distributed to the beneficiaries.

How much fun does that sound like?

"Oh, hey, sis, know that money I sent you?

"Send me 25 grand back."

And how quickly are you going to hear - "I already spent that money, I already gave it away., "I already did this, I did that"?

"Hey, I'll get it to you...".

Or, "No, I'd be happy to do that.

"I'll call you Tuesday."

Oh, what a mess.

Please make sure that you're getting good counsel.

You don't want to be in the position where you have to go back and claw back assets from beneficiaries.

It is just not something that will make the family Thanksgiving dinner a pleasant experience.

So just avoid that.

Make sure that you're well prepared in advance.

You're going to be just fine.

With all the preparation you've already done, this is a walk in the park and will give you no stress whatsoever.

And by the way, thank you.

Thank you for your service to your mom at a time when I know, I hope she deeply appreciates it.

What I deeply appreciate is you, our audience, the very best.

You ask the best questions.

You're interested.

Your lives are interesting.

What you have as challenges are important and ones that so many other folks can learn from.

So if you've got a question, a concern in your, in your picture, financial or not, More Than Money is the name of the show, send us that email... We answer every single question back to you.

We have a tremendous team, very dedicated financial advisors that can help in every single way.

And maybe, just maybe, it'll be a question that we pick to air on a future show.

In any event, we want to be there to serve you.

Thank you for serving us by spending part of your evening with us.

We hope you learned a lot.

We hope you were mildly entertained along the way.

\And we hope you'll return next week when we're here with More Than Money.

Goodnight.