- And good evening.

You've got More Than Money.

You've got Gene Dickison your host, your personal financial advisor.

I say it every week because it's true every week.

That doesn't change.

What changes, wonderfully so, what changes are the questions that you ask.

You make us the most relevant financial show on television today.

What a bold statement.

And if it were based on "I am the most incredible, "impressive, and unbelievable and intelligent," well, all those things are true, that isn't at issue here.

What is at issue is that that's rather arrogant and stuffy, and I trust... Boring, boring.

You are none of those things.

The questions that you ask are fascinating.

And I think, certainly according to our audience, fascinating to our audience, as well.

So when you ask an interesting question about your life, about what you're trying to accomplish, you are affecting hundreds, perhaps thousands of people who have similar questions, similar concerns, similar, gosh, challenges, in terms of how to get from where they are to where they wish to be in their financial lives.

And the title More than Money, which I'll take credit for, I picked that decades ago as we started out on radio, and then, morphed into our television career.

Our title, More Than Money, is exactly that.

Because while, gosh, every one of our questions has some sense of a financial tone to it, or a complete financial tone, there's almost always either a hint or a complete under-story that needs to be responded about people.

People.

And let's be fair, isn't that really the important part?

And I think that may be why we get such a positive response from all of you.

We get such kind words.

You are very, very kind indeed.

But I think it's also why you have made it so easy for us to continue to put the effort in, do the good work, answer every single question back to you.

Our entire team is committed to doing that.

Our world headquarters here in the Holy Lands between Bethlehem and Nazareth, here in Pennsylvania, we are able to answer, coast to coast, north and south, all of your questions, and pleased to do so, pleased to do so.

And maybe, just maybe you'll hear your question asked and answered on a future show, just like this audience member is about to have theirs.

Megs, where do we start?

- Well, our first email tonight comes from somebody that I think really values your opinion.

They said, "I am 70, widowed without children, "and have almost $1 million in my IRAs.

"I have two questions that I asked my advisor, "and he gave me answers that I'm not sure are right.

"First, should I consolidate the three IRAs I have in one?

"He says no, and it won't make a difference.

"Second, should I convert big parts of my IRAs to Roth IRAs?

"He says, yes, it will save me in the long run.

"My goals are to simplify my life so when I start losing it, "I have less things to worry about, "and I want to set up my affairs so what I own goes to "my church when I'm gone.

"In 30 years, though, just like you, I'll be 100.

"Thank you, Gene."

- We're starting a movement!

By golly, happy, healthy, 100.

I didn't invent that phrase, but I have stolen it.

And soon, I will simply claim it as my own.

Good for you.

Good for you on 100 levels.

On 100 levels.

Yes, 100.

Fantastic.

Number two, asking questions, even though your financial advisor's given you an answer, that's called seeking a second opinion.

Very wise.

In many, many cases, it's very, very wise, not just financially.

Gosh, we talk about second opinions in the medical field.

That's normal, and almost it would be silly not to, if you have a major medical issue.

But in the financial world, often, sadly, folks feel like their advisors, "Gosh, they're so smart.

And I'm really not.

"They know a lot.

I really don't.

"I guess they're right."

Guessing is probably not in your best interest.

Confirming makes a great deal of sense.

So while I appreciate your comments very, very much, I more appreciate your confidence that you bring your second-opinion concerns to us.

Let's start with the easy one.

You have three IRAs.

You suggested consolidating them into one.

Your adviser says, eh, it doesn't really help.

Sure it does.

Sure it does.

Three statements, monthly statements, become one.

Three accounts that have different pieces in perhaps different proportions that hopefully you're looking at kind of in an integrated form, but they're not integrated, they're on separate documents, separate pieces of paper.

One more thing to be concerned about.

I think that's silly.

Not only is there perhaps not the greatest reason in the world to consolidate, there's the greatest reason in the world not to leave it separate.

So, yes, while your advisor admittedly has to do a little bit of work, has to do a little bit of work, maybe that's the reason, I don't know, I'm just saying...

Yes, consolidating makes a great deal of sense in my mind because, gosh, you're 70.

You might be losing it.

Don't start that stuff, because we got 30 years to go together.

Yeah.

We're not going to lose it until the end.

Till the very end.

And then, who cares?

Bonkers.

Bottom line is, yes, consolidate.

Number two, Roth conversion.

Not a good idea.

It's a great idea if the idea was, if your idea, your goal was to spend, spend, spend and pocket as much as you possibly can in your life.

That's not what you're describing.

You're describing making a difference in a charity and a nonprofit and a church, etc, after you're gone.

And, unlike leaving an IRA to a human, an individual, where they must then pay income taxes... Oh, nasty.

...leaving an IRA to a charity, they don't pay income taxes.

So let's play simple numbers game, just for fun, and it's got to be simple.

I don't want to get a headache this early in the show.

$1 million completely converted might cost you, round numbers, $200,000 in income taxes.

So assuming, sadly, shortly thereafter, you expire, you assume room temperature, you graduate to the next dimension, you pass away, you die, mortality still running right at that 100% mark, hmm... ...you're gone, your charity of choice, or choices, get $800,000.

The day before that conversion, they would have gotten a million, and paid no tax whatsoever.

So, it doesn't seem as if your advisor's on the same wavelength as you are on either of these questions.

Keeping in mind that that happens, and sometimes advisors drift off.

As we discussed earlier, people do.

Sometimes advisors have certain, kind of, stuck-in-their-rut answers for questions, and sometimes advisors simply don't pay as much attention to their clients as they need to.

If you are happy with your advisor otherwise, just give them a slight tap on the wrist and say, "Ah, should've done better," and do what needs to be done.

If, on the other hand, you're not feeling the chemistry, maybe this is just kind of tip of the iceberg of how things have not been kind of custom-tailored to your needs as much as they should be, maybe it's time to look elsewhere.

Speaking of elsewhere, where else, where do we go to answer questions, Megs?

- Our next question says, "Hi.

I love to watch your show.

"It's so informative.

"I was wondering if I stopped working at age 62, "never to work again, but do not take social security, "will my monthly Social Security check increase, "besides cost of living increases, until I take it "at 65, 67 or 70 years old?

Thank you so much."

- Wow.

That's an interesting question.

- Okay.

The answer is maybe.

Maybe.

And let's talk through this from a Social Security standpoint, how the mechanics of Social Security works.

If we take it at 62, my apologies, if we stop working at 62, we have a certain income record that's on record at the Social Security system, which, by the way, you can access rather easily by establishing your own Social Security account on irs.gov.

And you should.

Even if you're years away from retirement, you should establish your own account because you will establish a password.

And if there are, and sadly, there are, bad actors out there who are trying to set up a Social Security account on your earnings record, pretending to be you, they won't be able to.

If you decide, "I don't need it now, "I'll wait until the very last moment," you may end up having a real problem getting those kinds of things fixed.

So set up your account.

It will give you a very good delineation of your earnings records, and it will give you some projections of what you can expect, in terms of Social Security benefits.

We need to focus on the earnings records, because you're saying, "If I quit now and wait "eight years, will it continue to go up?"

It may, if you have enough years of working that you end up with 35 years reported for IRS earnings.

If you have not, and now, because we need 35 years, next year, you write a zero, that zero will bring your benefit down a bit, even though your base benefit is supposed to rise between 62 and normal retirement age 6% a year, adding a zero may end up bringing your average down enough that it doesn't.

And adding zeros for eight years, is it enough to overcome the automatic increases between 62 and normal retirement age 6% a year, between normal retirement age and 78% a year?

Are those natural increases going to be enough to overcome zero years in your calculation?

The answer is, I don't know.

I don't know.

And there's no one that knows until you sit down with a Social Security expert.

Now, we're very blessed in our More Than Money world, we have such a Social Security expert, and he can guide you in helping to determine that by looking specifically at your earnings record, not talking in general terms.

We're talking here in parameters.

We're talking here in the big picture.

You need this to decide specifically for you as an individual with your exact records, and certainly Mark Bacak, on our team, or anyone else, any other financial advisor.

Our show goes coast to coast and border to border, as wherever you're seeing it, there are Social Security experts and perhaps financial advisors who are also Social Security experts that you might counsel with, but make sure you do exactly that, make sure you counsel with them and find out exactly what you are giving up, if anything.

If anything.

Fascinating.

A lot of numbers, lot of numbers, sometimes, sometimes, I know it gets mathy.

I get it.

And some of you, ooh, I'm allergic to mathy stuff, so you've already kind of pulled back.

Don't do that.

Hang on.

Because maybe, the next question has no math in it at all.

Let's find out.

Megs, what's next?

- I may have some bad news.

There's a little bit of, there's some numbers.

Hopefully nobody sneezes.

This one says, "Hello, Gene, I love your show.

"Three years ago, I bought an Invesco Bond Fund "with money I had from selling my home.

"I have 25,000 shares.

"Since then, I've been renting for a good price from a friend.

"Although this fund pays 2% income that I use to pay part "of the rent, I'm wondering how long I should wait for this "investment to recover, since it's down about 20%.

"I would like to use the money to someday buy a home.

"Should I keep it in Invesco, "or move it to a better investment?

"I prefer it would recover so I can buy a home at the same "value of my previous home.

"Thank you for your advice."

- Don't thank me yet.

You may not like my advice.

But that happens.

You took the chance.

You roll the dice, you get what you get.

And in this particular case, one of the things that you get is the correction of a misunderstanding.

In your mind, this fund has lost a lot of money.

In reality, having done some research, we found that this fund has gained year by year.

You said three years.

We went back five, six years.

It's been positive returns for all of those years.

Now, how is it that this individual is seeing their numbers, and seeing a loss, and the actual performance on the investment shows a gain?

It's pretty straightforward.

In this particular case, it is a bond fund.

And one of the operations, one of the mechanical operations of a bond fund is that when they release a distribution, a dividend, I'll use simple numbers... You're right, we don't want anybody sneezing out.

They're allergic to the math stuff.

The account has a $10 a share value.

If they declare $0.50, a 5% distribution dividend, the account value goes to $9.50.

The $0.50 goes out, he tried to say, and the account value goes down.

Did you lose $0.50?

The answer is no.

No, the account value, $9.50, plus the $0.50, in your case, you've used it to pay rent, but it's still a profit.

It's still yours.

In this case, that is gone.

But if you if you didn't, if you moved it simply to another account, you'd have $9.50 plus $.50.

You've lost nothing whatsoever.

And so distributions and profits are not the same thing.

They may distribute 5% and have earned 3%, so maybe the account value has gone down a bit based on performance, but the bulk of your decline is on withdrawals.

You have taken the money, taken the money.

If you had left it in to compound, you would have more money today than what you started.

So is it going to recover?

That's not likely.

It's not impossible.

The type of fund that you're in is a very short-term bond fund.

It has very modest gains, intended to be very modest.

It's very stable.

But 2-3%, sometimes 1% gains are typical.

Annual gains are typical.

So how long will it take before a 1-3% gain per year gets you back to even?

If you stop taking out the dividends, the answer is still likely 5-7 years.

Does that make it a bad fund?

Not at all.

It makes it...

These are the characteristics of that type of fund.

Are you better off trying to quickly recover by moving that money into a very aggressive fund?

Not likely.

Very aggressive funds have the very uncomfortable habit of dropping like a rock right after you invest.

Right after I invest, right after anybody invests.

It's been doing great.

So you give him 100 grand and the next time you look at it, it's 88,000 bucks.

Now, it doesn't mean it's a dreadful fund.

It means it's very aggressive.

It has a tremendous up and down to it.

And so, that very tremendous down hopefully will be followed by a very tremendous up.

Recently, we examined the fund that, in 2022, was down a lot, it was down 23%.

Not good at all.

It's up this year, 47%.

So lots of volatility.

Maybe that's in your best interest?

Not likely.

It's far more likely that something in that mid range, something that maybe gives you a solid rate of return with the opportunity to get a solid overall profit, and yet have some protection against losses is more likely in your best interest.

You don't talk about time frame.

So if you're interested in recovering 20% over the next 12 months, I am at a loss to give you assurance that that will happen.

Quite to the contrary, I think quite often, when we try to get that aggressive, the results are poor.

If you're looking at, say, three years, two-and-a-half, three years, I think there's an excellent chance that you can do that.

But it's going to take some work and it's going to take some examination, and it's going to take some self-examination to make sure that you really understand the investments that you're making, how they actually perform, and what alternatives you should be looking at as you go forward.

Interesting question.

Very interesting.

And you were right, Megs.

There was enough math in there.

There's people out there that got itches already.

They got some hive bumps.

But maybe, I don't know, we're going to find out, maybe the next one won't have any math.

Won't that be delightful?

Megs, what do we got?

- That would be delightful.

I see a number, but I don't really know that it's going to get too mathy.

This email also would like to know what's their best option.

It says, "I have Social Security and a pension.

"My wife has a small Social Security.

"We have 180,000 in the bank, still have a mortgage.

"Wondering what should we do?

Invest?

Thanks, Gene."

- Oh, you're right.

Numbers.

But the real issue isn't the numbers side.

Social Security, both small pensions.

Got it.

What we don't know is cash flow.

What we don't know is, does the income that they currently have cover their expenses?

Let's assume for a moment it does.

Assume.

The second thing we don't know is how much that mortgage balance currently is.

Unless I missed something in that, and if I did, Megan will yell at me.

But I don't think we heard what the mortgage balance is.

Let's say, for example, it's $40,000.

We have 180 sitting over here.

We have 40,000 still to be paid.

Is there a serious negative to paying off that mortgage?

It doesn't sound like it.

It actually sounds like it would be a rather nice positive, because even if you're only paying a relatively modest interest rate on that balance, it would eliminate your debt.

It would eliminate that monthly payment.

It would allow your current cash flow to be stretched even further because you don't have to continue to make those payments.

Is it necessarily the ideal financial move?

The answer is, I don't know.

And I'm not really sure I care.

Because the benefit, particularly the emotional benefit of paying off a mortgage is pretty substantial.

Pretty substantial.

And I often, over my 780 years of experience, made the statement that I have never met, never met anyone who paid off their mortgage and said, "Darn, I wish I still owed money."

And the reality is that a number of years ago, a very dear friend who has since passed on, but a very dear friend who had a wonderful sense of humor, came in for his investment review with his wonderful, wonderful bride.

And the first thing he said to me was, "Gene, you know, "I paid my mortgage off 5-6 years ago," and I said, "I know."

He said, "I regret that."

And he did that just so I could never say that again.

So I will say, I have rarely met anyone who ever regretted paying off their mortgage.

Assuming that these numbers are relatively close, absolutely.

If you want to make sure that we're looking at your specifics, reach out to us again.

We're happy to help.

Megs, helping is what we do best.

Who do we help next?

- Well, this next emailer sounds like they're pretty silly.

They say, "I won't tell you how much my wife and I enjoy your "show because I want to spare you the expense of having "to buy new hats because your head got too big.

"So I'll get right to my question.

"You've said several times that it's good to have a financial "adviser who is a fiduciary, defined as someone who is "obligated to look out for the investor's best interests.

"But how can one determine if an adviser "is indeed a fiduciary?

"Can anyone just claim to be a fiduciary?

"Is it the honors system, or does an advisor need to be "certified as a fiduciary?

"In short, how can an investor determine if someone "who claims to be a fiduciary actually is one?

"Thanks, Gene, and hang on to those hats."

- I don't find that silly.

I thought it was wonderful.

Why would she say it's silly?

Guy loves me, obviously.

Well, bless you.

That's very, very kind and well said.

Silly indeed, and we appreciate silly more than you could possibly know.

So the question about fiduciary is a very serious one.

The word "fiduciary" is not one that the average person bumps into on regular occasion.

But in our industry and the financial advisory industry, it's a huge issue.

It is even bigger issue in the regulatory side of our industry, the FINRA, Financial Industry Regulatory Authority, the S.E.C., the Department of Labor.

These are all major regulators who look at the operations of financial advisory firms, and they are very interested in the word fiduciary.

They are constantly creating more and more regulations around the control of that application, that intention.

Let's give it a definition.

Fiduciary, putting my best interests behind those of my clients.

Translate it a slightly different way, putting the best interests of my client ahead of my own.

So, for example, a client says to me, "Should I invest $100,000 with you?

"You're going to get paid, or should I pay off my mortgage "with the same $100,000, and you don't get paid?"

Hmm.

A Fiduciary Financial Advisor looks very carefully at the client situation, and if the best interest of the client is to take that money, pay off the mortgage and I don't get paid.

that's exactly the advice that a fiduciary financial advisor would give.

A salesman, on the other hand...

I think you already know where this is going.

A salesman, on the other hand, has no such obligation.

Salesmen would say something like, "Well, you know, if you invest with me, "you're going to make a lot of money.

"Lots more than if you pay off your mortgage."

Hmm.

Whose best interest is really being served?

Pretty obvious.

So one of the first ways that you can see the difference between fiduciaries and non is licensing.

A fiduciary advisor, normally a registered investment adviser is exactly that.

A salesman is a salesman.

So you can look at regulatory websites, BrokerCheck, FINRA, etc.

they will tell you what licenses an individual has.

If the only license they have is a sales license, a life insurance sales license, a real estate sales license, an annuity sales license, they're not fiduciaries.

It's just that simple.

They may try to be, they may wish to be, they may claim to be.

They're not legally bound to be.

And bottom line is...

Sadly, fiduciaries can still be criminals, so they can start out with the best of intentions and go off the rails.

In our industry, it is commonplace now, the words Bernie Madoff, everybody knows them.

And there are hundreds, sadly, of minor Bernie Madoffs who have embezzled, stolen millions, hundreds of thousands, in some cases silly people, thousands, in spite of the fact that they are licensed and expected to be fiduciaries.

So the last way that you're going to assure yourself of a fiduciary is to get a referral to that adviser from somebody who understands exactly what you're looking for and knows that advisor's history of work.

So if you're talking to your attorney, talking to your accountant, maybe watching TV, listening to your radio, bottom line is, you can judge an advisor by the body of their work most effectively.

Very good question.

Very good question indeed.

And thank you for the compliments.

And, folks, thank you.

Thank you for spending part of your time with us.

If you've got a question that will help keep us the most relevant financial show on television, send it to us.

Gene@AskMTM.com works very, very well.

One member of our team will answer your question back to you, every single question.

Happy to do so, and happy to help.

No charge whatsoever.

And hopefully, since it's no charge whatsoever, you'll return next week as we return to the studio to bring you another edition, another set of answers to your questions right here on More Than Money.

Goodnight.