Hi.

Good evening.

You've got more than money.

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

And when I say personal, I mean that quite personally.

One of the great pleasures, one of the great joys of being a financial advisor is to guide folks down a financial path.

But maybe they have some fear.

Maybe they have some concern there.

It is often said that the number one fear of folks retiring is running out of money.

That's a very appropriate fear.

There are lots of ways to avoid that.

But if you're not aware of those ways, if you're not informed or knowledgeable about the different ways that you can be protected, whether it's, retiring, buying your first house, educating your kids, all of the typical types of things that American families want to do.

If you're not aware, if you're not informed, if you're not guided, it can be a real, anxiety provoking process.

It doesn't have to be.

And I hope one of the things that, comes across, I think if you're a loyal viewer, you've already figured this out.

But if you're just joining us, maybe for the first or second time, it's a new season.

Of course, we've got some new folks who have joined us in season seven.

If if you are, figuring out that there is, there's a method to the madness, so to speak.

There's a, there's a value or a process that that allows you, to increase, not just necessarily your rate of return.

That that's that's certainly lovely.

But that's not the key, not necessarily the number of dollars you piled up, but the confidence, the confidence that you gain in making informed decisions, making decisions.

Choice is between option A, B, or C, not based on, I don't know, I guess b, but based on now that I understand the pros and the cons and there's always cons, there's always pros.

Well, there's not always pros.

Generally speaking, the investment options, the choices you're making, throughout your financial life, have positives and negatives, and you have been fully informed of the positives and the negatives of your options so that you can make that choice and confidently make that choice based on.

Now that I know this makes sense to me, this is common sense.

Common sense.

Maybe one of the rarest commodities in the world today.

If we look around and we're honest, there's not a whole lot of it.

But that's what we are building.

That's the foundation of how we build our financial advice to you are more than money advisors.

Myself, 780 years of experience have spent careers figuring out how to build the, the recommendations we make, the financial plans that we recommend.

The the advice that we give based on common sense, doing a lot of basic, correct things over and over and over again.

There's no mystery to this.

If your, your plan is to win the lottery.

Bless you.

I wish you great luck.

It is not a good plan.

If your plan is to marry wealthy, good for you.

I wish you good luck.

It's not a great plan.

Bottom line is that there are certain things that we can do over and over and over again that are beneficial.

Guaranteed.

Maybe not.

Life is full of surprises.

But increase your probabilities dramatically increase your confidence, dramatically increase your peace of mind.

Dramatically.

Absolutely.

If you'd like to participate in all of that, all you have to do is send us your questions by email.

Gene GENE and ask mtm dot com Gene at ask mtm dot com.

Works very very well.

They all come to me.

We have an entire team of financial advisors that will answer those questions back to you.

So everyone gets their questions answered back.

If you didn't get your answer, check your spam filter.

Just say it.

Because very often folks say, you never answered.

There it is.

It's in my spam filter.

So bottom line is we answer every single question back to you and give you as much information as we possibly can.

There's no cost.

There's no pressure.

There's no obligation.

And how much fun would it be if you were watching one evening and heard your question asked on air?

Well, somebody is going to have that fun right now.

Let's start with our first question.

Are there really only two options?

And that's kind of a cryptic title to a fairly detailed question.

And let's explore it.

I greatly appreciate and enjoy your show.

I'm in my late 60s and I've been retired for two years.

My income, Social Security, for my, pension, and a very small annuity meets my needs.

Before my last job, I did not earn very much.

So I did not save very much.

But thankfully, that last job enabled me in ten years to grow my original retirement savings by five fold.

I want to stop right there.

This individual, this gentleman, was able in ten years to 500% five times his retirement savings.

So for those of you out there, they're saying I'm 50 and I really haven't put much away.

I educated my kids.

Spend a lot of money.

I guess it's too late.

No.

It's not.

It's, fantastic that that, in and of itself, is a worthy.

Note my monthly income is certainly enough for me to live on.

I have not needed to touch any of my own retirement savings except for one small distribution.

I'm preparing to open my part time service business for a skill that I have cultivated for more than 30 years.

That's cool.

I hope this can add several hundred dollars a month to my income.

That would be fantastic and it would give me great purpose and spiritual fulfillment.

Wow.

That's incredible.

I'm widowed.

I have no children.

Most of my beneficiaries in my well are organizations that help people.

What a good guy.

I've relocated many times over the years due to my different job positions.

I lived in the big city, mostly renting because I could never afford those prices, so I never bought a home.

My plan for retirement was to buy a small home, simple, and use a modest inheritance from my parents to do so.

I hear news about a possible recession or a cut in Social Security.

Our financial world seems so unstable that I'm anxious about rents that may rise above what my income could support.

There are some lower priced houses that come on the market about two hours north of where I live, and so far.

That's really away from my friends and family.

If I have that three hour drive, I can get to the best market for my business.

Goodness.

So I'm trying to figure out what I should do in terms of my, the best sense of security continuing to rent, in his current locale, being close to his business market, or moving further north so he could have a home but be so much further away from, his business and his friends.

I feel like a choice between, love and support close by as I age versus predictable.

Predictable expenses could be one of isolation.

So he's looking at two options.

He can either afford to buy a home very far away, certainly in his mind, to two and a half, three hours away from friends and society that he knows and the support of loved ones and, and and companions, or being stuck renting and being close to all those good things and close to the market for his his business that he hopes will add several hundred dollars a month to his, retirement.

Are there really only two options here?

And that's the question that I ask, for example, very, very simple example.

If you are moving two hours away, you are assuming that you are leaving behind all the people that currently are surrounding you and supporting you.

That could very well be true, but it negates or ignores the possibility that you would build new friendships, new relationships, perhaps bigger, better, stronger relationships wherever you might go.

If you're moving to, an area of modestly priced homes and for everyone in our audience since we're nationwide, you pick think in your mind of an area near you a couple of hours away that the homes would be more modest.

Would you think they're predominantly rural, smaller towns, smaller communities?

Answer is that that comes to my mind.

And in those types of communities, people tend to be pretty friendly.

People tend to know everybody.

People tend to if you go to church, you're going to get introduced to a bunch of folks.

If you go down to the, to a Rotary Club meeting, you're going to introduce to the community.

If you start patronizing local businesses, you're going to rather rapidly, learn that you've got the potential for lots and lots of friends.

So that's a very simple example.

A more, interesting perhaps example is the opposite.

You stay where you are or maybe even move closer to your business market and buy saying how can I?

The prices are too high.

Think about two different, variations on a theme.

Buying a single family home for 4 or 5 $600,000.

We were recently in the Atlanta area for 809 hundred.

$1 million for typical homes could be out of the realm of possibility.

But what about buying a four unit apartment building a little higher, perhaps.

Purchase price.

But you live in one apartment and you rent out three apartments so that you have, cash flow to pay for the mortgage, maybe even pay for the taxes and and the insurance.

So, in essence, you trade for a relatively modest monthly outlay, make sure the maintenance is taken care of, collect the rent and who knows, maybe the tenants become friends as well.

So that's one idea of how to afford to live in an area that's maybe more akin to what you're looking for, or what you're used to.

Another idea, seniors are, and I'm assuming are you since late 60s?

Sure.

So seniors, are often, I say often, percentage wise, not very high, ten, 15%, but often in a position where they like having a single family home.

They like having that, that kind of, of structure and room and space.

But affording it can be a real challenge.

How about roommates?

How about a four bedroom, 2 or 3 bath home all of a sudden, if you had a roommate or two, again, providing some rental income, maybe that allows you to afford that home and to be comfortable.

And alternatively, and again, another option.

So too, now we're up to five.

There's at least 6 or 7.

Another option is to look very carefully at this business opportunity that you're creating for yourself.

You're looking for fulfillment and, and, and and spiritual satisfaction.

That's fantastic.

Those rewards.

Enough.

That's enough.

But it can also be more profitable.

So make sure that you're counseling with somebody who understands business.

In most communities, the SBA has a, it's a program called score Service Corps of Retired Executives.

These are individuals that have been through business for decades and decades, and now they supply that experience to folks who are just starting out.

So even though you're in your late 60s as a business owner, you're just starting out, you're new to this.

So maybe if you get a little bit of guidance, a little bit of, of, information, a little bit of wisdom and experience from folks who have been there, you might find that instead of several hundred dollars a month, maybe it's a couple thousand dollars a month, and now maybe affording that home in the area that you would prefer to be in could be an option.

So I have no answer.

That's, precisely correct, because I've not spoken directly to this gentleman.

But what I do know is quite often we get ourselves in a position where, it looks like it's either or.

I gotta take one or the other.

And in most cases, it is not the case that it's either or.

In most cases, there are variations on the same.

There are different options that may not be, immediately evident, but in many, many cases with a little bit of creativity, a little thought, you can, you can accomplish what you need to.

Good luck and God bless.

Yes, indeed.

A little long winded, but really interesting question.

So let's see if our next question is as interesting.

No one likes this kind of surprise.

That doesn't sound good.

I emailed a question to my financial advisor one evening.

Require regarding my required minimum distribution.

He called me the next morning to discuss my concerns and after mostly chit chat, the weather, the economy, the family, a short mention of my investments, the armed was discussed.

The next thing I saw in my account statement was a consultation charge for $500.

My apologies.

I need to correct that.

It says nearly 500.

I think that ends up becoming important in terms of my answer.

Is this normal?

I don't usually scrutinize these statements, but now I'm concerned and will probably not be emailing or calling for concerns in the future based on this fee.

It is not like I have a lot of money and $500 is a lot in my household.

Thank you for your response.

Well, first of all, you're very welcome.

And you're right, no one likes that kind of surprise.

The truth is, this may be one of a number of situations that is is simply a misunderstanding.

It just it just may be literally.

Hey, once you know, it's not a problem, it is unlikely.

Depending on the financial advisors business model with you, his relationship with you, that a 5 or 10 minute phone call would result in a $500 charge?

I am one of the world's most expensive financial advisors, and I don't charge $500 for five minutes.

So if it's not me, you definitely got ripped off.

So he says, bottom line is, it's likely likely that you're noticing by coincidence, a a quarterly fee on your statement that maybe you had not noted previously.

It might even be, depending on your account, an annual fee.

So if we use 1% as a simple demonstration number for fees for financial advisors, a 1% if you if your fee is $500, 1% of 50,000 is $500.

So if you have a $50,000 account and you're paying your advisor roughly $500 for the year, I think that's pretty reasonable.

If you're $50,000 account and you're paying $500 a quarter, $2,000 a year, that's not reasonable at all.

And you have good reason to exit, if indeed.

By the way, the $500 was for a five minute conversation and you got to go there are tons and I mean tons of high quality, fantastic, very skilled financial advisors.

MTM world.

Sure, but thousands of others across the country that are fantastic, that don't charge $500 for ten minutes of conversation.

So if that indeed was the case out, I don't think it was.

I don't think it was.

I think it's a misunderstanding.

Now, part of the misunderstanding is, is is on you.

I don't usually look at the statements.

Why not?

Why not even high quality financial advisors.

There's mistakes made.

What if there were, a hack?

What if there was an invasion?

What if there was an identity theft and people were taking money from your account?

You should pay attention.

And that leads to give it a five minute review when you get your monthly statement.

So part of it's on you, part of it's on your advisor.

Even if this is absolutely explainable, he or she did not explain it very well.

Or they having reminded you often enough that you go, oh, I remember now that's exactly how it's supposed to be.

So if this is the scenario that you're faced with, your financial advisor, I guess two chances out of three, it's not a good indicator.

It's either real.

It was $500 for five minutes.

Get rid of them.

Or he or she doesn't explain things very well.

That's not a good sign.

You can find lots of great advisors.

They explain things beautifully.

Or number three.

It's a misunderstanding.

Good advice.

And and and a good value.

Hopefully with a few questions and a few minutes with your advisor, you'll find out the answer to all of those things.

And, with any like at all.

Simple.

Easy.

Put it to rest.

And if not, yeah, you get lots of great options.

Speaking of options, we have the option of going to another question.

I vote for another question.

Why congratulate me?

I voted and they, that's not what it's about.

Congratulations.

Due to a remarkable promotion, I got a raise at work.

Bless.

I now have an additional ace sitting down $10,000 a year to invest.

That's a promotion.

Would it be a better choice to part this in a Roth IRA, or use the cash to pay taxes on a Roth conversion?

Fascinate.

No wonder you got a promotion.

This is a very smart question.

I'm 62.

I don't plan to retire for at least ten years.

I'm in the 22% tax bracket.

My retirement savings, 400,000 in a Roth, already 900,000 in regular IRAs and $20,000 in current employer's Roth 401 K. They're all invested in various mutual funds.

I'm already funding the 41K to the full extent of my employer match, which is 4%.

Thank you.

Your show as much.

Must watch TV.

Thank you for me, I recommended it to many others as very kind of you and to all of you who are out there going, yeah, I really enjoy it.

Start recommending it.

Goodness, don't let her get ahead of you.

Young lady, first of all, congratulations.

Fantastic.

Obviously well deserved and very, very intelligent question for a lot of you.

You're going, does it really matter?

She just puts it in the Roth or she uses it for a Roth conversion.

He answers.

It could matter a substantial amount.

It could matter a substantial amount.

Now, in order to give you kind of the comparison, she's in the 22% bracket.

I will be using the 20% bracket because that's easy math.

And since I'm going to be doing mental math before your very eyes without a net.

Yeah, 20%, that's what we're going to use.

So here's the idea.

We have $10,000 extra per year per year, and she's got ten years until retirement.

These are all projections.

Her projections.

And let's let's use those at face value.

So, if she drops, $10,000 into the Roth, per year, nothing changes her.

Her income tax does not change.

She does not get a deduction.

There's no, leverage, so to speak, from tax savings.

Except that from the moment that 10,000 hits her Roth IRA, no more tax for the rest of her life.

That's a pretty cool thing.

Now, admittedly, and very important to observe 400,000 already in her Roth.

So it's not a small number, and she has 900,000 in her regular IRA, a much bigger number.

So putting 10,000 into the account over the next ten years.

Very nice.

It will add at least the contributions $100,000 to her Roth IRA.

Very, very nice.

That could produce 4 or $5000 a year of income for the rest of her life, tax free.

Very nice.

In the alternative, using the $10,000 as the payment for the income taxes on a Roth conversion, meaning moving money from an IRA to a Roth IRA.

Meaning if she's in the 20% bracket, you'll see why I made that such a simple number.

It means that $10,000 is multiplied by five, because the tax on $50,000 in a 20% bracket is $10,000.

So instead of having an additional 10,000 in her Roth IRA tax free for the rest of her life, she could have an additional $50,000 in her Roth IRA for the next ten years, adding not 100,000 but adding half $1 million into her Roth IRA and doing something else.

That's kind of indirect, not on her radar screen right this moment, but it will be in ten years.

And that's the issue of RMDs.

If we have RMDs on a $900,000 IRA, the first year is going to be roughly $36,000.

If we convert half $1 million over the next ten years, we won't have $900,000 that will be required to be brought out and taxed.

We will have very simple numbers, obviously not meant to be accurate because we're not counting in withdrawals.

We're not counting in investment returns, we're not counting in profits, any of that stuff.

But we'll go from 900 to roughly 400 all of a sudden, instead of needing to take out 36,000 whether she wants to or not and pay tax on it, she'll be taking out 16,000.

So the the impact on her is dramatic.

Absolutely dramatic.

And from her standpoint, adding half $1 million, probably more with the profits are, taking her Roth to maybe $1 million a year.

Now she's got 40, 45, 50,000 a year tax free for as long as she lives.

That's a pretty cool thing.

Well done.

You you deserve the promotion, cuz you're very, very smart.

Let's see if we can squeeze in one more.

Do we have one back there?

RMDs are not as simple as A-b-c.

Is that a Michael Jackson song?

No.

Well, that, due to a recent, My apologies, my husband passed.

Oh, my husband passed in October of last year.

He was 72 years old at the time.

We did not take an R&D.

Do I need to take the RMD from his accounts, which were transferred to me as inherited accounts?

The firm I am with believes I do not need to do so, but felt it would be prudent to check with you.

Interesting.

We're planning on merging those accounts into my IRAs this year.

I'm holding off until I hear from you.

Okay.

I was, told that if I merge without taking the RMD in the arm, he is required.

It can be very messy.

Well, a couple things are interesting.

Her financial advisors won't move until I give them permission.

That's kind of interesting.

Most financial advisors are far more confident in their advice than that.

But thanks.

I know there are lots of financial advisors out there watching our show.

I hope you're learning a lot.

I hope you're using all of that to help your clients.

And if you have a question as a financial advisor, you're not sure to send those to us.

Happy to help.

Happy to help.

So, her husband passed away last year.

He was 72.

He was not yet eligible.

He was not yet of age.

Where the R&D kicks in.

So there is no R&D issue.

He passed away last year.

He was 72.

He was not yet 73.

And that's the age at which RMDs are required.

So now you don't have to take it.

R&D.

And yes, spouses can inherit IRAs and merge them with their own IRAs.

And in most cases, that makes perfect sense.

90, 95%.

There are rare cases generally with spouses who die quite young, below age 60, where keeping them separate could be very, very valuable.

That's another topic for another day.

But in this particular case, very simple, very, very simple.

There's no RMD required.

You don't have to wait.

Can you merge his IRA with yours?

Answers.

Absolutely yes.

And then you'll have one account and RMDs for you will apply to the entire account.

When you are required to take them when you reach age 73 or older.

So bless you.

Sorry for your loss, but clearing this up and helping at your advisors.

Happy to do it.

Speaking of happy, we've ripped through an entire show already.

We've answered a fair number of questions, and and hopefully you picked up some ideas, learned a couple things.

Some of these are some of the more interesting that we have seen, certainly in our, in our new season, season seven.

But we encourage you to make our further shows, our future shows even more interesting by adding your questions to the mix.

Send those to me, Gene at ask MTM dot com give as much detail as you possibly can so that our financial advisors can answer you back and give you the best information that we can, very specific to your circumstance.

And of course, we do promise that all of your questions are answered back to you specifically.

And some of those will be chosen to air on future shows here on PBS.

So knowing that you could be anywhere tonight doing anything, the fact that you spend a half an hour with me means a lot.

Hopefully you'll do the same next week when we return for another edition of More Than Money.