Good evening.

You have more than money.

You've got Gene Dickison you've got Megan Smale.

You've got our entire team serving you this evening.

Hopefully answering maybe a question that applies directly to you.

If you are a loyal viewer to more than money, you already know that we are the most relevant financial show on television today, bar none coast to coast and border to border for two very important reasons.

Number one, you set the agenda.

You are the... You you set this up for all the information that we share.

We don't decide what to share.

You do.

That makes it very, very relevant indeed.

And number two, because we are PBS bound, we are coast to coast and we are getting information from so many sources.

It is the freshest answers to the most important questions that pretty much makes us the most relevant financial show on television.

If you're joining us for the first time, that may cause you to scratch your head a bit.

Please don't.

If you are interested in seeing how it works, participate yourself directly.

All you need do is send us your questions.

Can be a question, could be an observation, maybe a concern.

A challenge.

Send those directly to me, Gene at ask MTM dot com and perhaps you'll see your question answered on a future show.

But rest assured, we answer every single question back to the folks who ask.

We have an entire team, lots of financial advisors, lots of support staff that we can do exactly that.

There's no charge, there's no obligation, there's no stress.

You're just getting great information to serve you.

And the ability to serve you.

The opportunity to serve you is why we come together every single week bringing you more than money.

It's a very, very we are very honored that you allow us to do that.

And the fact that you could be anywhere, doing anything and you're choosing to spend a half an hour with us is very it means a great deal to us.

Bottom line is half an hour goes quickly, though, So don't wander off.

Don't lose focus.

As a matter of fact, let's get started and we'll show you right away how this works.

Meghan, where do we start this evening?

Hi, Gene.

Our first question tonight says, My wife and I live in Pennsylvania.

We watch your show each week on PBS and learn a lot from the answers to the viewer's questions.

I want to know if a check for $30,000 made out by me as a gift to our son and daughter in law with both of their names on the check and signed by me would be okay with the federal gift tax limits.

In other words, would the IRS consider it $15,000 for each of them and we would not have to fill out the gift tax form?

Thank you.

that's an excellent question.

And the audience that we serve is very generous.

So gifting is a highly sought after topic.

It's one that we discuss with folks quite often.

Currently, you are permitted as a as a taxpayer in the United States to give to anyone as many any ones as you wish.

They don't even have to be family, to anyone.

$18,000 per year.

That's the current number.

If you're watching this in the future, that number may change.

So make sure you're checking with the most current numbers.

18,000 and below per person allows you to make those gifts without even filing a form you don't have to add anything to your tax return.

So in this particular case, a $30,000 check made out to two people from one person's it two people, son and daughter in law is well within the limit and there's no need to file any tax forms in any way, shape or form.

Now, let's make sure that we understand a couple of very important points.

Number one, this gentleman, should he be married, husband and wives, spouses are allowed to make what are called split gifts.

Ironically, they're actually joint gifts.

So they could, if they wanted to maximize the gifts, give $36,000 each 18 to each of the two younger folks.

And as a result, they could give away not 30 but $72,000 if they were looking to maximize their recipients of the gifts.

Never pay tax taxes are not gifts, are not taxable.

And the fact that they live in Pennsylvania doesn't really apply in this particular case because these are federal gift tax rules.

They apply in all 50 states.

So wherever you're seeing our More than Money show this evening, this applies to you as well.

By the way, just one more fun fact, just in case you have a much bigger gift plans.

In addition to the annual limits that we just discussed, there is a lifetime gift limit per person and it's something just north of $12 million.

So a husband and wife, should they be so blessed with a very large asset base, could gift away during your lifetime about $25 million, and then continue to give $18,000 per year per person to as many people as they wish for as long as they should live.

So if you are of a generous spirit, as long as you follow the rules, you can be extremely generous and the IRS will have no interest in you whatsoever.

Megs, I'm interested in what's our next question.

Sounds good.

Our next question has to do with long term care planning.

It says, I love your program on PBS.

And the advice that you give comes across as fatherly advice given to children.

I have gained a lot of knowledge on many financial topics, so I need advice from you regarding my situation.

I am 59 and plan to retire at 65 in 2030.

I will get a good pension and with joint life 100% with my spouse, the pension will come to around 7500 per month.

My Social Security estimate at 2030 is around 3000 per month.

My wife will be eligible for spousal benefit, which she will take at 2032 when she turns 65.

Our investments are worth 1.1 million.

As of today.

We have one daughter who is fully independent.

We only have 49,000 remaining on our primary home and this will be fully paid off in November of 2027.

Our monthly expenses at retirement will be around 7000 plus inflation from 2030.

I feel we should be well-situated financially, but the thought of long term care situation is concerning me and my wife, wondering how do we plan to pay for long term care?

Do we buy long term care insurance or buy an annuity with a long term care component or health care account or something else?

With withdraw strategies from our retirement accounts?

Should we adopt to minimize taxes at retirement with long term care costs in mind, I look forward to your fatherly advice.

Thank you.

Well, I'll I'll take fatherly advice.

I'll take that for sure.

There's there's no downside to that.

Grandfatherly advice actually applies since our recent arrival.

So that's fantastic and appreciate the kind words.

This is a challenge that lots and lots and lots of folks face.

You are in a strong financial position unless unless there is a loss of health with either or both of you.

Heaven forbid the costs of care now have skyrocketed to the point where it is not unusual at all for us to see annual care costs in the $200,000 range.

They they range from much more modest than that 50 or 60,000 perhaps, and in some extreme cases, much larger than that.

So while you have you are a millionaire, you have amassed $1,000,000 and by the time you retire, that will likely be in excess of $2 million.

That's a very powerful place to be indeed.

Goodness, the loss of health at 100, 150, $200,000 a year could be financially devastating, particularly to the spouse who does not lose their health.

It is very common that the spouse who sadly needs that kind of care has a rather long lifeline and the the spouse who's providing the care ends up suffering physically.

And an early death, unfortunately, happens.

It's it's it's not unusual at all.

So making these plans is extremely important.

You have a huge advantage in that you are frugal.

You I have calculated your retirement income at in excess of $12,000 a month and you will be expected to spend about seven.

So you have an excess there that could absolutely fund the premiums on a long term care insurance contract.

It could also be accumulated so that you could fund a single premium into or a single deposit into a hybrid long term care program.

That's a typically based either with an annuity or with a life insurance contract.

And then the riders that are added provide for long term care benefits.

That is currently probably pretty high on our list, without a doubt high on our list in terms of the most affordable and reliable of long term care insurance solutions, those are much more reliable because they don't have annual premiums and as a result, you're never exposed to the risk of being priced out.

Having your premiums raised to a point where you can't afford them.

One other thing that you might consider, might consider.

It's not the answer for everyone.

Maybe less than half, but there are continuing care retirement communities.

CCRC Where if you are comfortable living in that environment, happy to live in, in essence a communal arrangement, you can have your own independence, either a home or an apartment to start when your health is good.

But CCRC guarantees that in exchange for your deposit to come into that that community, they will care for you.

Whatever level of care you may need in the future.

So you have a number of things to explore.

Make sure you're working with a trusted and experienced financial advisor who has extensive experience in the long term care planning piece.

Long term care insurance is only one part of a long term care plan.

Make sure you're working with someone who's been around a while and can give you fatherly advice about how best to meet your needs and be happy while you're doing it.

Excellent question.

Lots of detail.

Hopefully we helped.

Who do we help next, Megs?

Well, our next question definitely fits into the more part of more than money.

This one says My husband and I are in our eighties and retired with three grown children and seven mostly grown grandchildren.

Our will leaves 10% to each child, which will likely amount to over $100,000 for each of them in cash.

It's enough to make a difference in their lives.

Our children have varying degrees of success and needs.

Our daughter is doing just fine and our two sons are a mixed bag.

I just want to be fair and treat all of them equally.

However, my husband wants to increase the share for one son because at age 56 he has few prospects for his future.

He is underemployed and unambitious, but he is very attentive and visits us often.

It's easy for him.

He is the closest geographically.

Our other son does not share his financial situation with us, although he claims to be building up his 401k with his employer, he does not own a home and he is still making payments on a six year old car and is always wishing for a new one.

He never picks up the tab when we go out and in his younger days he was very irresponsible with money and debt.

I feel that with his share of the inheritance, his 401k and Social Security and his very responsible grown daughter looking out for him, he should be just fine.

But what do you think?

Thanks.

goodness.

I think our headline already gives you a kind of an indication of where I'm going to lean.

Same parent, same DNA, same environment.

The kids were raised exactly the same or as close as possible and yet very different results.

So as we think about this, when we have a difference of opinion from an estate planning standpoint, there's two things that are very important to remember as we go forward.

Number one, each individual creates their own estate plan.

So a husband and a wife, they do not have one plan, they have two plans.

So the husband in this case can execute documents.

It does exactly what he wants to do.

He wants to give extra to the son who has not done very well, so to speak, but is kind and generous and attentive.

The fact that he lives geographically closer, there's lots of folks out there who heard that comment and said, it doesn't matter.

We have kids that live two blocks away that we never see.

So if he's close and it's easy, so to speak, and he's attentive, that says something quite admirable about him.

But if the second set of documents in this case, the wife said a document says something very different.

In one case I want to give more her says I want to be equal.

It will it will depend on who passes first.

So if he passes first, everything goes into her estate.

It will be distributed according to her wishes.

If she passes first, everything goes to his estate.

It will be distributed according to his wishes.

Knowing this alone is enough for some folks to live a very long life if they're very committed to having their wishes applied.

It's just going to stick around a long time and and and maybe that's a good thing.

Maybe that's good motivation.

I mentioned there's two points here.

If there is a disagreement, this is a as many of you know, I've been doing this for a long time, 780 years.

Well, it's it's almost a miracle if there is a dispute, a financial dispute particularly.

But when it involves family, specifically between husband and wife, the wife is always right.

She's always right.

Even when she's not.

She's always right.

Always, if you know what I mean.

You are you're in your eighties.

You've been around a long time, sir.

I'm sure you understand.

Bottom line is that this is a very minor issue to be resolved.

Create your own documents.

Put it exactly the way each of you wish in your documents, and then someone else from above and beyond will decide who goes first and who's left to make the final decision.

Bless you all.

Bless you all, man.

That was fast.

There's a very, very interesting question.

Family dynamics can be really challenging.

Yes, we see a lot of those.

Our next question is about pension.

It says, well, it asks how should I take my pension benefits as a teacher?

I am in the appeasers program.

I have the option to take a lump sum out $148,000 or leave it in and take a higher monthly pension.

Which of these options should I take?

If I roll over the lump sum, how should I invest that money?

And isn't the current investment climate the craziest you've ever seen?

Thank you for your wise advice.

Well, that very kind wise advice might be a little overly optimistic, but we shall see.

We shall see in the state of Pennsylvania, which is where we are based, although we serve clients from coast to coast and from border to border.

But we are a national firm in the state of Pennsylvania.

The Pennsylvania retired employees Retirement System pleasers often referred to it's often referred to, as has this dual campaign union structure where the in this case teacher contributes and accumulates money in a pool in a lump sum.

In this case, $148,000, and the state and the school districts contribute into a pension which is distributed on a monthly basis, a traditional pension basis.

And at retirement, the the individual, the participant in this case, this young lady, gets to choose to either take the 148,000 has the option, take it, spend the time or pay the tax and spend it.

That's an option.

Take the 148.

Roll it into an I.R.A.

and have it still re what relegated to retirement funds.

Excuse me.

And another option is to take the 148 added to the pension and it increases the monthly pension for as long as she should live.

So very interesting questions.

She says, what options should I take?

Well, I mean, no surprise.

It depends.

In this particular case, it will depend on what her monthly cash flow needs are.

If the pension alone is $4,000 a month and added to her Social Security, she has enough or more than enough to pay her bills.

Then she should take the 148.

Roll it into an IRA.

Allow that to accumulate over time and supplement her income in retirement.

If, on the other hand, her income with Social Security and pension isn't quite enough, and her anxiety or her angst about having guaranteed income is very, very high, then leaving the 148 into the pension will increase that monthly absolutely guaranteed can't kind of mess this up in any way, shape or form.

Option.

What if she's not 100% sure?

That's an interesting position that lots of folks find themselves in.

In that case, what we recommend is that you roll the 148 the lump sum into an IRA, so there's no current taxes.

Live with your pension for as long as you need to decide whether it's enough or not, because the 148 can always be turned into a pension through the use of what's referred to as a CPA.

Single premium immediate annuity.

At any point in her life, she can decide to take the 148 or whatever the balance is at that moment, invested in a single premium immediate annuity, and it becomes a lifetime pension, a lifetime private pension that she can add to her teachers pension.

And now she has kind of re-upped again, if it turns out that having lived with her pension, she's got more than enough, then she's going to have a tremendous amount of flexibility on her 148,000 and the opportunity maybe even to pass it on to the next generation.

So you've got some markers that you've got to address.

You've got some checkmarks that you've got to make on your decision tree and make sure whatever you're doing, you're dealing with someone who is experienced and trusted so they can walk you through the options.

Many financial advisers can also use software tools to project out your financial results from each of those options.

You can compare them side by side, but you've got a wonderful retirement in front of you with tremendous amounts of assurance.

Lots of folks don't have pensions.

You do consider yourself quite lucky and make the decision that's best for you.

Megs, let's decide to answer another question.

Our next question says, I want to ask about stocks to bonds percentages.

I am a 57 year old man, married, working and would like to retire around 65.

I have 150,000 in a Roth IRA target fund that is 60% stocks and 40% bonds and $100,000 in a mutual fund.

That is all large cap stocks.

I'm about 73% in stocks and 22% in bonds.

Some would say I'm overweight in stocks.

But listening to your show, it sounds like to make 7% in retirement.

I would have to have mostly stocks.

I also have 120,000 in savings.

I love watching your show.

Thank you so much for your advice.

Well, your words are very kind and your question is very interesting.

It strikes me that you are probably a well versed in investing.

Good for you.

You've done some homework.

You've gotten yourself trained up a bit.

So you understand that diversification are a fancy word for don't put all your eggs in one basket is quite important.

So we're looking here at two big pieces stocks and bonds.

These are big labeled pieces.

Stocks and bonds.

There are many, many different types of stocks.

Many, many different types of bonds.

But in this particular case, in this question, we're looking much at a much higher level.

The 30,000 foot view, so to speak.

And in this case, he is 73% in the market in some fashion and 22% in bonds.

The key issue here, he has eight years to go until retirement.

While many folks would say 73% in the stock market is quite aggressive, I would tend to disagree based on these facts.

His balance is currently 73 and 22 is not is not the whole picture.

He has $120,000 in the bank.

That reduces his risk dramatically.

I might say as a collateral observation, it also reduces his return.

Having that much money in the bank at what I would consider to be relatively low rates versus the kinds of returns he could get elsewhere, in my opinion, could very well hold him back a bit.

But bottom line, with eight years to go, this kind of allocation, this kind of concentration, so to speak, in the stock market is not inappropriate in any way, shape or form.

Now, having said that, eight years gives me great comfort.

Five years gives me comfort.

Three years gives me about a bit of comfort in anything less than three years.

I'm not comfortable at all because relying on investments that could go down drum radically.

If you'll remember, 2008 -50%.

So half of if he were to take a loss on of of 50% on 73% of his investments, he could see a drop of 35%.

That would be devastating.

Just before retirement.

So as this eight years becomes five, becomes three, becomes closer.

This needs to evolve.

This allocation strategy needs to become more appropriate as we get closer and closer to the point where he will rely on his capital to provide him with a retirement that makes him happy, healthy, comfortable.

So this is not something that is a set it and forget it kind of process.

One other observation I'll make that's not in this question, but some of you may or may be connecting the dots.

In recent shows we've talked about the fact that there are a number of new investment platforms where you can invest in the stock market with every expectation of doing well.

Seven, eight, 9% and be protected in the event that the stock market should drop.

Some protections are modest, -10%.

The market goes down ten, you lose nothing.

Others aren't dramatically impactful.

100% protected.

So you could be in the stock market and have a reasonable gain on the upside and be 100% protected on the downside.

This, for this particular gentleman, might very well end up in him deciding to eliminate bonds completely.

Why would you accept a two, three, four or 5% return where over a time period, reasonable time period, you could expect a six, seven, 8% return with virtually no risk.

So it's something that for all of you who have as we explored this question, said, this really does apply to me, too.

You might carefully consider some of the newer investment platforms that are available to in what some folks would say, have your cake and eat it too.

Speaking of which, we're coming dreadfully close to the end of the show.

If you would like to have your cake and eat it too, that would be getting all the questions that you have answered very easily.

Very simply, no cost, no pressure.

Send us your email questions.

Gene at ask MTM dot com G-E-N-E at ask MTM dot com.

We answer every single question back to you.

The hard ones, the easy ones, the silly ones, all of them.

They get answered back to you.

Some of you respond instantly.

Some of you we lose, they drift off, but we're there for you and we're happy to serve you and you help make us the most relevant show on television.

So stick with this week by week.

I hope that you've learned enough that you're going to want to do that as we return next week to this podium and we bring you another edition of more than Money.

Goodnight.