July 24, 2025 • 32 mins
On this Ask Suze & KT Anything episode, KT asks Suze your questions about Roths, the must-have documents and teaching your adult children money lessons and so much more.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Suze (00:29):
July 24, 2025. Welcome everybody to the Women and Money podcast,
as well as everybody smart enough to listen. Today we
are so lucky to have the birthday girl.
KT (00:43):
This is the birthday week, not just for me.
But we've got so many July babies. We have Laurie Seligman,
one of Suze's fabulous, fabulous friends...
Suze (00:56):
Oldest.
KT (00:56):
We have Alex, our incredible horseman,
Suze (01:00):
Alex Axella, Alex, happy, happy birthday to you.
He's such an incredible young man, isn't he?
KT (01:07):
He jumps over those fences with those beautiful horses.
Suze (01:11):
He could dance.
He's boat captain and airplane plane pilot, so great, so great.
I contribute that to his mother, Bridget, but that's besides
the point. All right.
KT (01:21):
And his poppy,
Suze (01:23):
Poppy
KT (01:23):
Michael,
Suze (01:24):
Mike Axla.
What an incredible man as well.
KT (01:28):
We had the best time. My sister and I want
to thank all of you that sent beautiful notes, especially
on the wall. I couldn't believe it. It was like
over like 100 messages, so beautiful, and we, we're glad
we made you all laugh too.
Suze posts these things that I could kill her for doing,
but what she posted was very funny. So those of
(01:49):
you that haven't seen it, go to the wall on
the Women and Money app and enjoy a good chuckle.
Suze (01:56):
Yeah, they all said, Oh, I wish they had a sister.
They wish they could laugh like you. It's like, so KT,
you truly do light up this whole world.
KT (02:07):
Thank you, Suze. And Suze's gift was yet again almost
25 years of gifts, almost the most incredible heartfelt. I
haven't shared it with anyone, and my sister asked if
I could share it with her. I said, not yet.
Maybe when we're in Canada fishing or when we're on
(02:29):
the plane, it's a video, but it's very personal, and
Suze was unplugged and raw. She looked right into the camera,
no makeup, no glasses, nothing, and told me what she
thought and felt and wanted me to know.
Well, I can't, I'm gonna cry if I keep thinking
(02:50):
about it. So let's, let's move on and I will
one day share that.
Suze (02:54):
Alright, so today is Ask KT and Suze Anything, and
this is where you can write in to ask Suze
SUZE podcast at gmail.com.
You can ask a question there. Now thousands come in,
but if KT chooses it, it will be on this podcast,
and as many of you know, I do scan them,
(03:16):
and I will answer you personally if I think it
warrants it. All I ask is don't write me your
entire financial situation and ask me, are you OK?
Don't do that. That's not what this is about. This
is about asking questions really that you want to know,
(03:37):
but that would also help everybody else who's listening. And
when you make it so personal, do I have 50,000 here,
10,000 here, I have this and that. I have 4 kids.
We're not going to choose it just so you know.
All right, Miss
Travis, what do you have for us?
KT (03:52):
But I did choose something that isn't a question that
I'd like to start today with.
And it's always in the subject area. This is what
always attracts my attention. This subject said with gratitude from
someone you helped more than you'll ever know. And her
name is Jen, and I want to read this and
share it with all of you. Dear Suze, thank you
(04:15):
for the woman you are and the life changing guidance
you've shared with millions, your straight talk, deep care, and
unwavering insistence on financial clarity,
have helped so many of us live stronger, freer lives.
As I listened to your podcast about the must-have documents,
(04:36):
I was struck again by how deeply you impacted not
only my life but the life of my late partner.
From the moment we met in 1996, she was already
a devoted fan. By the time the Suze Orman show
became part of our weekly routine in 2002,
(04:56):
we were both hooked, grateful students, soaking up every hard
truth and every ounce of your wisdom because of you
and your books at the time we had everything in
place wills, power of attorney, advance directives, beneficiary designations, the works.
And when I lost her to suicide in late 2003,
(05:22):
those documents, those systems you urged us to have gave
me something close to a soft landing. As much as
that's even possible. Without them, I can't imagine how much
harder that would have been. Sad, right?
Suze (05:39):
Yeah, but
true.
KT (05:41):
It's been nearly 22 years since then, but she gave
me wings, and I've done my best to fly.
I've built businesses grown in purpose, and today I find
myself assisting a financial advisor licensed in life insurance and
annuities while I haven't yet sold a policy as I've
(06:02):
solely been focused on assisting.
The experience has been educational. I can hear your voice
in my head.
Suze (06:10):
You
just did. Uh oh.
KT (06:13):
Here's what Jen wrote. She said, rightly skeptical of the
products pushed too hard for commission's sake. When I mentioned
your name to my boss, his reaction only made it
clearer to me. I'd rather be you than him. Every
single time you've inspired me again this time to begin
planting seeds for something of my own, a service for
(06:37):
LGBTQ individuals and chosen families to help them take those
same essential steps my partner and I did all those
years ago to help them feel safe, informed, and empowered.
Thank you, Suze, for everything you gave us back then
and everything you continue to give now with all my heart, Jen.
Suze (07:02):
You know, that I love that, but I have to
tell you, you know, I said I scroll through these
and I found you wrote to her and I wrote
her and
Jen, if you're listening right now, you now have the
email that if you just reply to will come directly
to me, right? But what's important is in your endeavor
(07:23):
to help those who really somehow feel like they're left
out and as time goes on they're being more and
more left out truthfully that write me if you need
help or you just want.
Another wing to help you fly a little more, know
that I am that wing for you, so always feel
free to write me directly. All right, there you go.
KT (07:46):
OK, I'm going to follow that heartfelt email with one
of my favorite topics of all time. Can you guess, Suze? Roth!
This is from Amber. She said, Hi, Suze. My employer's
401k offers three options and will contribute up to 4%
of the match. Pre-tax, Roth and post-tax. I'm confused. I
(08:09):
thought the Roth option was post-tax. What's the difference between
a Roth contribution and a post-tax contribution? Thank you for
all you do and fish on KT Nice birthday haul.
Suze (08:23):
That was a nice birthday. We've now had it for lunch,
for dinner, for the whole thing. Amber, by the way,
we love your name Amber, because KT and I love
that Amber color and beautiful. I have little bracelets of
amber that I wear. I just love them. I always
think it means money just so you know.
(08:45):
So anyway, I hope you have lots of money. Amber.
Here's the thing, right, you are correct. There are 3
different types of employer sponsored plans. Obviously a 401k pre-tax
means you fund it with money you've never paid taxes on.
It grows and it grows and it grows, and when
you go to withdraw it.
You're going to pay taxes on everything that you withdraw,
(09:08):
just that simple. A Roth 401k. You fund it with
after-tax contributions, and as that money grows and grows and grows,
when you go to take it out later on following
certain rules, it's 100% tax free, including its earnings. All right,
there is something known as you said, as post-tax contributions.
(09:33):
Now all of you know.
That there are certain limits that you can put in
to a 401k or a 403B or whatever it may
be that you're contributing to. Under 50, it's $23,500. For
those of you who are 50 or older, it's $7500
(09:53):
in addition, so that's another $31,000 total. And for those
of you who happen to be between the ages of
60 and 63.
You can put in an additional $11,250 that includes that $7500.
And so you have ways to get money in there,
but above those limits.
(10:13):
In a pre-tax 401k plan, you can put in after
tax contributions up to $70,000 in total. I'll get to
that in a 2nd. $77,500 if you're 50 or older,
and that's $81,250 if you are 6263 now.
(10:39):
It goes into a special sub-account within that 401k.
What's interesting about post-tax contributions is those contributions are free
when you withdraw them. However, the earnings on those contributions
are 100% taxable unless your plan allows you.
(11:04):
To do a transfer from that subaccount to your 401k
Roth account at that corporation. So you have to ask
now KT's looking at me a little confused, so you
want me to give you an example, right?
KT (11:20):
Please.
Suze (11:20):
She said, please. My favorite. Well, you brought the topic up, KT.
So listen, let's say you're under 50.
Right, don't you wish? Do you wish?
KT (11:30):
No, give me the example.
Suze (11:32):
Oh, sorry, sorry. All right, so if you defer, let's say
$23,500 and let's say your employer matches $4500. Now just
so you all remember, always the employer contribution goes into
a pre-taxed 401k because they want the tax write-off, even
if you are doing a Roth 401k, but anyway.
(11:55):
$23,500 in a pre-tax 401k. Your employer matches that $4500
so that's a total of $28,000. So you could take
that $28,000 subtract it from the $70,000 allowed, KT, to
be totally put into that account that year.
(12:16):
And contribute up to $42,000 in additional after-tax contributions into
your pre-taxed 401k that will be held in a sub-account
for you. So remember, however, not all 401ks offer this,
so you need to ask and just check on it,
(12:38):
but that's how it works. That's how people get
what's called a mega retirement account, they keep doing this
and then they transfer it to their Roth 40 and
before you know they have millions in seriously their Roth 401k.
KT (12:56):
So which
of the three is best for Amber?
Suze (12:59):
I don't know. I don't know how much money she has,
but let's just say she's just has the typical amount.
Right. Obviously she should be doing a Roth, 100% a
Roth with her money, and then I would also be
doing a Roth IRA if you qualify.
And then if you have extra money, so put it
(13:19):
in a pre-tax 401k at work as your after-tax post contributions.
KT (13:25):
OK, there you go, Amber. Suze, next question says, hi Suze,
thank you so very much for helping my wife and
I get our finances back on track.
My question during these volatile times, ready, listen to this carefully, Suze.
Should we pay our rent two to three years in advance?
(13:47):
This money is a bonus from my work. We have
600,000 in a diversified investment portfolio per your recommendations. We
are 73 and 70.
And then it says, yep, we went off the rails
in our 50s, recovered in our 60s, and here we are.
Recently retired and want to postpone taking any investment income
(14:12):
till 2028. I love the ending of this email. It
says biscuits and hugs, Linda.
Biscuits and hugs.
Suze (14:23):
That's because KT loves biscuits.
KT (14:24):
I love biscuits.
Suze (14:25):
So no, Linda, you are not to do that, and
let me tell you why.
KT (14:29):
Rent.
Suze (14:30):
Right?
What does that mean rent?
KT (14:34):
No, because she wants to pay two to three years
in advance. Rent!
Suze (14:37):
Do you think I did not listen to you carefully?
You told me to listen to you
carefully.
KT (14:41):
Because of the word rent. Soon as I saw that,
I said, Don't do it.
Suze (14:45):
Well, there you go. That's your answer. Why shouldn't she
do it? KT?
KT (14:49):
Anything could happen to you and your partner, and you've
paid three years in advance of rent. It's, it's not
even your property.
Suze (14:57):
That's not the only reason.
KT (15:00):
All right, let's see what there's a whole lot of reasons.
You could do better things with that money.
Suze (15:06):
Give me another.
Who is she paying rent to?
KT (15:10):
I don't know.
Suze (15:10):
The landlord. What could happen to the landlord?
KT (15:14):
Landlord could be gone.
Suze (15:15):
They could be gone.
KT (15:16):
They could sell.
Suze (15:18):
They could have an accident. They could pass away.
KT (15:20):
All I know is the word rent was my red flag,
Suze (15:23):
But anything can happen. So given, why not,
the money that you would pay in advance and just
put it somewhere safe as your rent money making just
money market interest rates on it and just do that
with it. I obviously would be investing it at this
point in time because I do think after August and September,
(15:46):
which could be a little bit of rough months but
maybe not.
These markets still have a lot to go, but no,
that's such a waste of money. I cannot even tell you.
All right, go on.
KT (15:56):
Ok, next question from Donna. Hi, Suze and KT. Hope
you had a wonderful birthday, KT. I did. Donna
says thanks for delivering an interesting informative and fun podcast
to us twice each week. My question pertains to the must-have documents.
Suze (16:12):
KT wants to go to only once a week, so
you better tell her. You better say something.
KT (16:17):
My question pertains to the must-have documents and, and by
the way, for all of you that maybe missed my birthday.
We have a special and I believe the special is
for the whole month of July.
Suze (16:29):
No.
KT (16:29):
Oh, until when?
Suze (16:30):
It is 'till Sunday.
KT (16:31):
Oh, 'till this Sunday. Don't miss it. So I turned
I turned 73 and we were able to ask, Hey
house to please offer the must-have documents at $73 for
Suze's listeners, an incredible value.
Suze (16:49):
So you need to go to Musthavedocs.com/birthday
And until Sunday midnight Pacific time, that $73 is good again,
normally it's $99 for $2500 worth of state of the
art documents. KT, I'm sorry, I just have to say
(17:11):
something here which is.
You know, I watch the news in certain channels all
the time news channels. Then all the time there is
this advertisement for this trust and will program and everything
like that. Just a will for $169. What they also
don't tell you is that yearly.
They very well will charge you a renewal fee if
(17:32):
you want to change it or anything 35 a year.
But anyway, these are four documents a will, a trust,
an advance directive, and a durable power of attorney for
health care. You need all of them. But here's what
I love about this program. Any time we have an update, OK?
(17:53):
The update is free for you any time you want
to make a change,
you can go back as many times as you want
and change it and change it and change it over
all the years.
And best but not least, you can share it with
all your family members. This was never meant to be.
Every single one of you needs to
(18:13):
buy it.
KT (18:14):
No, it's shareware.
Suze (18:15):
It's Suze shareware, so only one of you needs to
buy it. You get an activation code. You give your
activation code to your family members, whoever it may be,
as many as you want really.
They then use the activation code, but they create their
own account, their own password, so they cannot see anything
(18:37):
that you have again $2500 worth of state of the
art documents good in all 50 states. Now if that
sounded like a plug for it, oh, it most certainly is.
And on Sunday I'm going to tell you a story
which is why I'm seriously now.
What would you say, KT? I'm just so knowing that
(19:00):
this is something that every single one of you needs.
You have
to have.
KT (19:05):
So, so Donna continues to say in the email, Currently
I have a living revocable trust that was created several
years ago. It's been updated a few times, including when
I moved to a different state. I'm wondering if I
should purchase the must-have documents with the special $73 birthday rate,
(19:26):
and use them next time I need to amend my
current trust instead of paying the hourly rate to an attorney.
Then the final question, is it possible to transfer my
existing trust into the must-have documents?
Suze (19:42):
And the
answer to that is no. It is not possible. Chances
are what you are going to have to do if
you want to do that, Donna, is when you get
the must-have docs, you're going to essentially start all over,
enter the information that you have in your trust now
into the
program so it is there for you. So when you
(20:03):
want to change it in the future, it's easy for
you to change it. You can access it. There's no
personal information, by the way, everybody in there. It's not
like you're putting in your bank account numbers or your addresses,
and it's just who you want to leave everything to
and how you want to leave it. So don't worry
about it. But then what you would have to do
(20:24):
is get everything notarized again.
Give everybody your banks and everything copies of your new trust,
and there you go because they always should have the
most updated copies of your wills and trusts. All right,
go on, KT.
KT (20:40):
And again, another must have question.
This is from Joanie. I love you gals. Thank you
for all your wonderful guidance through the years. I'm updating
my must-haves, which I originally completed in 2012. 1 thing
I'm confused about, this is a good question, Suze. Should
my IRAs, I have most of my funds in a
(21:02):
wroth and a bit in a traditional, be titled in
the name of the trust or my name?
Should I name my beneficiaries directly into the retirement accounts,
or should the trust be my beneficiary?
Suze (21:17):
So first of all, there is a reason why
an IRA stands for an individual retirement account whether it's
a Roth or a traditional meaning pre-tax, it's an IRA,
so you cannot name it in the name of the
trust because a trust is not an individual.
(21:39):
I would tell you that if in fact you are married,
all right, if you are married, your spouse absolutely should
be your primary beneficiary on any of your retirement accounts
cause they have certain rights that nobody else has in
terms of a contingent beneficiary.
(22:00):
If your children are of age, they're older, they're responsible,
whatever it may be, and let's say they're your secondary beneficiaries,
your contingent, your spouse being your first, if you don't
have a spouse, then your children who are absolutely capable,
they should be individually named if they are minors, however.
(22:22):
Then again your spouse would be the primary. The trust
would be the secondary or contingency. Or if you don't
have a spouse, then yes, your trust should be named
as the beneficiary if you have minor children, all right,
KT (22:40):
OK. Next question from Jenny. Suze, I just realized that
my husband is the primary account holder of our credit cards.
I'm not sure where I heard this, but I heard
that when you die, your credit
cards get canceled and your spouse, who was an authorized user,
will no longer be able to use the credit card.
Suze (23:00):
That is correct.
KT (23:01):
OK, we just retired and of course our income's lower.
I'm a little worried about applying for a new card
with me as the primary. Do you have any advice
for Jenny?
Suze (23:12):
The amount of income you have isn't really that important
when applying truthfully for a credit card.
What you would do is if you have a good
FICO score, a good credit score, and you apply, it
can be based on maybe low income, but what they're
really looking at is, have you been responsible with your bills?
(23:34):
Is it a good credit score? So I would just apply.
Many retirees do that and everything, and they'll get a credit.
It might not be for a big limit.
But that's how you would start if you get denied,
then apply for a secured credit card where you put
down a deposit into that credit card that secures it.
(23:56):
And you'll start building your credit that way. It is
not too late. You are to do it right after
this podcast is heard by you.
KT (24:04):
So Suze, next question is from TJ. Hi Suze, my
daughter's 22 and will be 23 next month. She refinanced
her car to pay off credit cards two years ago
against my advice.
She then called her father, who was down on his
luck at the time, agreed to help her pay the
car loan, but then he passed away last year, and
(24:27):
she was so depressed, ready, Suze, she maxed out her
credit cards again.
Now she's $15,000 in debt, a full-time student working a
part-time job three days a week and on the weekends.
Her credit cards are closed. She's on a payment plan
that she cannot afford, and she barely is meeting that obligation.
(24:49):
She can't afford gas in the car, personal items, or summer.
Time fun activities and I refuse to help. Good. I
think she has to feel this to learn from it.
What is your advice?
Suze (25:03):
Do exactly what you have
been doing TJ.
It's just that simple. Obviously, this is a woman who
needs to learn until she gets it and the only
way she's going to get
it is by letting her suffer. Go on, KT.
KT (25:19):
OK, this is from Tina. Dear Suze and staff, you
have always provided the best financial advice. Thank you. I
am a 57 year old nurse that would like to
open a Roth IRA using a former employer's 401k funds.
It's less than $20,000 she says. I am currently contributing
(25:43):
to another 401k plan with my current employer. Can you
please explain the process, or should I consider a rollover
with my current employer?
Suze (25:54):
Tina, here's what you need to know if you have
less than $20,000 in your former employer's 401k.
If you do roll it to a Roth IRA, you
are going to do what owe ordinary income tax on 100%
of that $20,000. If I were you, I would leave
(26:16):
it with your former employer for now, and I would
convert or roll $10,000 this year into a Roth IRA.
You'll owe income taxes on that.
And next year, because we're not that far away from
next year, believe it or not, I would then convert
the other $10,000 at that time. Then you would have
(26:39):
$20,000 in a Roth IRA. How do you do it?
Go to any brokerage firm like a Schwab, Fidelity, whatever
it may be. Open up a Roth IRA there and
just go from custodian
to custodian, they will help you do it. It's just
that simple. Now I just have to say for your
(27:01):
current contributions to your 401k, can you just make sure
they're to a Roth 401k? Can you just do me
that favor?
Otherwise you're going to have to nurse me.
KT (27:14):
And one final question, Suze, this is from Chad. I, I,
I thought this was kind of fun. It says hiring
an investment professional personally, I don't think he needs to,
but I'll read it to you. My name is Chad.
I've just turned 59. I'm wondering if I should hire
an investment professional to manage my retirement savings. I've always
(27:36):
directed my retirement savings to go into the S&P 500
mutual funds. I always
keep in mind what you've said about trusting your gut
when interviewing investors. I've interviewed four so far, two of
whom I really like, and I have one more I
still want to speak with. Their fees range from 1.1%
(27:57):
to 1.5% of total assets invested. Do you consider those
rates reasonable? Should I hire one of these investors or
leave my savings where they are?
That's Chad's question.
Suze (28:13):
Oh, Chad, Chad, Chad, listen, this is a hard one
because the truth of the matter is, let's say you
started in 2009 investing, let's just say $10,000 and you
just put it in the Standard and Poor's 500 index,
which maybe you did, right? Then, you know, to 2024,
(28:33):
those 15 years, it averaged about 17.1%. It did incredibly
well now.
If you missed the 2009 and you went into 2010,
it would only be like 12.1%, but either way, fabulous.
So for every $10,000 that you invested
(28:54):
versus what the asset manager may charge you either 1.1%
or 1.5%, it's going to cost you a serious sum
of money. Very few asset managers truthfully can outperform the
Janner and Poor's 500 index. Now that doesn't mean that
(29:16):
you shouldn't use a financial advisor and those things. However,
it's not just about liking them, Chad.
You need to ask what has their actual return been
for the past 10 or 15 years and to prove
it to you because if they're not making at least 5%
(29:37):
more than what the Standard and Poor's 500 index is
making for you, it is a waste of your money
and just to give you an example, over 15 years
for every $10,000 you would have invested.
It would be about $14,000 more if you left it
in the Standard and Poor's 500 index versus this 1.5% fee,
(30:02):
or even if it were a 1.1% fee, it would
be like $8000 difference. So,
I don't know... if you've been doing well.
I probably would just leave it with what you've been doing.
That's what I will tell you, all right, unless you
find a manager who can beat the 500 index, prove it,
(30:24):
prove it, prove
it, prove it.
KT (30:26):
All right, Suze, that's a wrap. That was a great one.
Suze (30:29):
All right now, KT, let's remind everybody,
that the offer at Alliant Credit Union for 4.3% APY
for a 12 month certificate is still available for amounts
of $75,000 or more. It's 4.35% APY.
(30:51):
So you should look into it and go to myalliant
A L L I A N T.com and check it out.
And again, you only have a few days left to
take advantage of Miss KT's birthday pricing of $73. Go
to
MustHavedocs.com/birthday, and that is where you get the must-have docs
(31:17):
and why do we call them that KT?
KT (31:19):
Because you must have them!
Suze (31:21):
All right. So until next time there's only one thing
we want you all to remember when it comes to
your money.
And that is this is the year to do what KT?
KT (31:32):
Make your money, make more money.
Suze (31:36):
And that's exactly what we are doing. All right, everybody,
see you soon. We love you.
KT (31:41):
Bye bye.
July 24, 2025. Welcome everybody to the Women and Money podcast,
as well as everybody smart enough to listen. Today we
are so lucky to have the birthday girl.
KT (00:43):
This is the birthday week, not just for me.
But we've got so many July babies. We have Laurie Seligman,
one of Suze's fabulous, fabulous friends...
Suze (00:56):
Oldest.
KT (00:56):
We have Alex, our incredible horseman,
Suze (01:00):
Alex Axella, Alex, happy, happy birthday to you.
He's such an incredible young man, isn't he?
KT (01:07):
He jumps over those fences with those beautiful horses.
Suze (01:11):
He could dance.
He's boat captain and airplane plane pilot, so great, so great.
I contribute that to his mother, Bridget, but that's besides
the point. All right.
KT (01:21):
And his poppy,
Suze (01:23):
Poppy
KT (01:23):
Michael,
Suze (01:24):
Mike Axla.
What an incredible man as well.
KT (01:28):
We had the best time. My sister and I want
to thank all of you that sent beautiful notes, especially
on the wall. I couldn't believe it. It was like
over like 100 messages, so beautiful, and we, we're glad
we made you all laugh too.
Suze posts these things that I could kill her for doing,
but what she posted was very funny. So those of
(01:49):
you that haven't seen it, go to the wall on
the Women and Money app and enjoy a good chuckle.
Suze (01:56):
Yeah, they all said, Oh, I wish they had a sister.
They wish they could laugh like you. It's like, so KT,
you truly do light up this whole world.
KT (02:07):
Thank you, Suze. And Suze's gift was yet again almost
25 years of gifts, almost the most incredible heartfelt. I
haven't shared it with anyone, and my sister asked if
I could share it with her. I said, not yet.
Maybe when we're in Canada fishing or when we're on
(02:29):
the plane, it's a video, but it's very personal, and
Suze was unplugged and raw. She looked right into the camera,
no makeup, no glasses, nothing, and told me what she
thought and felt and wanted me to know.
Well, I can't, I'm gonna cry if I keep thinking
(02:50):
about it. So let's, let's move on and I will
one day share that.
Suze (02:54):
Alright, so today is Ask KT and Suze Anything, and
this is where you can write in to ask Suze
SUZE podcast at gmail.com.
You can ask a question there. Now thousands come in,
but if KT chooses it, it will be on this podcast,
and as many of you know, I do scan them,
(03:16):
and I will answer you personally if I think it
warrants it. All I ask is don't write me your
entire financial situation and ask me, are you OK?
Don't do that. That's not what this is about. This
is about asking questions really that you want to know,
(03:37):
but that would also help everybody else who's listening. And
when you make it so personal, do I have 50,000 here,
10,000 here, I have this and that. I have 4 kids.
We're not going to choose it just so you know.
All right, Miss
Travis, what do you have for us?
KT (03:52):
But I did choose something that isn't a question that
I'd like to start today with.
And it's always in the subject area. This is what
always attracts my attention. This subject said with gratitude from
someone you helped more than you'll ever know. And her
name is Jen, and I want to read this and
share it with all of you. Dear Suze, thank you
(04:15):
for the woman you are and the life changing guidance
you've shared with millions, your straight talk, deep care, and
unwavering insistence on financial clarity,
have helped so many of us live stronger, freer lives.
As I listened to your podcast about the must-have documents,
(04:36):
I was struck again by how deeply you impacted not
only my life but the life of my late partner.
From the moment we met in 1996, she was already
a devoted fan. By the time the Suze Orman show
became part of our weekly routine in 2002,
(04:56):
we were both hooked, grateful students, soaking up every hard
truth and every ounce of your wisdom because of you
and your books at the time we had everything in
place wills, power of attorney, advance directives, beneficiary designations, the works.
And when I lost her to suicide in late 2003,
(05:22):
those documents, those systems you urged us to have gave
me something close to a soft landing. As much as
that's even possible. Without them, I can't imagine how much
harder that would have been. Sad, right?
Suze (05:39):
Yeah, but
true.
KT (05:41):
It's been nearly 22 years since then, but she gave
me wings, and I've done my best to fly.
I've built businesses grown in purpose, and today I find
myself assisting a financial advisor licensed in life insurance and
annuities while I haven't yet sold a policy as I've
(06:02):
solely been focused on assisting.
The experience has been educational. I can hear your voice
in my head.
Suze (06:10):
You
just did. Uh oh.
KT (06:13):
Here's what Jen wrote. She said, rightly skeptical of the
products pushed too hard for commission's sake. When I mentioned
your name to my boss, his reaction only made it
clearer to me. I'd rather be you than him. Every
single time you've inspired me again this time to begin
planting seeds for something of my own, a service for
(06:37):
LGBTQ individuals and chosen families to help them take those
same essential steps my partner and I did all those
years ago to help them feel safe, informed, and empowered.
Thank you, Suze, for everything you gave us back then
and everything you continue to give now with all my heart, Jen.
Suze (07:02):
You know, that I love that, but I have to
tell you, you know, I said I scroll through these
and I found you wrote to her and I wrote
her and
Jen, if you're listening right now, you now have the
email that if you just reply to will come directly
to me, right? But what's important is in your endeavor
(07:23):
to help those who really somehow feel like they're left
out and as time goes on they're being more and
more left out truthfully that write me if you need
help or you just want.
Another wing to help you fly a little more, know
that I am that wing for you, so always feel
free to write me directly. All right, there you go.
KT (07:46):
OK, I'm going to follow that heartfelt email with one
of my favorite topics of all time. Can you guess, Suze? Roth!
This is from Amber. She said, Hi, Suze. My employer's
401k offers three options and will contribute up to 4%
of the match. Pre-tax, Roth and post-tax. I'm confused. I
(08:09):
thought the Roth option was post-tax. What's the difference between
a Roth contribution and a post-tax contribution? Thank you for
all you do and fish on KT Nice birthday haul.
Suze (08:23):
That was a nice birthday. We've now had it for lunch,
for dinner, for the whole thing. Amber, by the way,
we love your name Amber, because KT and I love
that Amber color and beautiful. I have little bracelets of
amber that I wear. I just love them. I always
think it means money just so you know.
(08:45):
So anyway, I hope you have lots of money. Amber.
Here's the thing, right, you are correct. There are 3
different types of employer sponsored plans. Obviously a 401k pre-tax
means you fund it with money you've never paid taxes on.
It grows and it grows and it grows, and when
you go to withdraw it.
You're going to pay taxes on everything that you withdraw,
(09:08):
just that simple. A Roth 401k. You fund it with
after-tax contributions, and as that money grows and grows and grows,
when you go to take it out later on following
certain rules, it's 100% tax free, including its earnings. All right,
there is something known as you said, as post-tax contributions.
(09:33):
Now all of you know.
That there are certain limits that you can put in
to a 401k or a 403B or whatever it may
be that you're contributing to. Under 50, it's $23,500. For
those of you who are 50 or older, it's $7500
(09:53):
in addition, so that's another $31,000 total. And for those
of you who happen to be between the ages of
60 and 63.
You can put in an additional $11,250 that includes that $7500.
And so you have ways to get money in there,
but above those limits.
(10:13):
In a pre-tax 401k plan, you can put in after
tax contributions up to $70,000 in total. I'll get to
that in a 2nd. $77,500 if you're 50 or older,
and that's $81,250 if you are 6263 now.
(10:39):
It goes into a special sub-account within that 401k.
What's interesting about post-tax contributions is those contributions are free
when you withdraw them. However, the earnings on those contributions
are 100% taxable unless your plan allows you.
(11:04):
To do a transfer from that subaccount to your 401k
Roth account at that corporation. So you have to ask
now KT's looking at me a little confused, so you
want me to give you an example, right?
KT (11:20):
Please.
Suze (11:20):
She said, please. My favorite. Well, you brought the topic up, KT.
So listen, let's say you're under 50.
Right, don't you wish? Do you wish?
KT (11:30):
No, give me the example.
Suze (11:32):
Oh, sorry, sorry. All right, so if you defer, let's say
$23,500 and let's say your employer matches $4500. Now just
so you all remember, always the employer contribution goes into
a pre-taxed 401k because they want the tax write-off, even
if you are doing a Roth 401k, but anyway.
(11:55):
$23,500 in a pre-tax 401k. Your employer matches that $4500
so that's a total of $28,000. So you could take
that $28,000 subtract it from the $70,000 allowed, KT, to
be totally put into that account that year.
(12:16):
And contribute up to $42,000 in additional after-tax contributions into
your pre-taxed 401k that will be held in a sub-account
for you. So remember, however, not all 401ks offer this,
so you need to ask and just check on it,
(12:38):
but that's how it works. That's how people get
what's called a mega retirement account, they keep doing this
and then they transfer it to their Roth 40 and
before you know they have millions in seriously their Roth 401k.
KT (12:56):
So which
of the three is best for Amber?
Suze (12:59):
I don't know. I don't know how much money she has,
but let's just say she's just has the typical amount.
Right. Obviously she should be doing a Roth, 100% a
Roth with her money, and then I would also be
doing a Roth IRA if you qualify.
And then if you have extra money, so put it
(13:19):
in a pre-tax 401k at work as your after-tax post contributions.
KT (13:25):
OK, there you go, Amber. Suze, next question says, hi Suze,
thank you so very much for helping my wife and
I get our finances back on track.
My question during these volatile times, ready, listen to this carefully, Suze.
Should we pay our rent two to three years in advance?
(13:47):
This money is a bonus from my work. We have
600,000 in a diversified investment portfolio per your recommendations. We
are 73 and 70.
And then it says, yep, we went off the rails
in our 50s, recovered in our 60s, and here we are.
Recently retired and want to postpone taking any investment income
(14:12):
till 2028. I love the ending of this email. It
says biscuits and hugs, Linda.
Biscuits and hugs.
Suze (14:23):
That's because KT loves biscuits.
KT (14:24):
I love biscuits.
Suze (14:25):
So no, Linda, you are not to do that, and
let me tell you why.
KT (14:29):
Rent.
Suze (14:30):
Right?
What does that mean rent?
KT (14:34):
No, because she wants to pay two to three years
in advance. Rent!
Suze (14:37):
Do you think I did not listen to you carefully?
You told me to listen to you
carefully.
KT (14:41):
Because of the word rent. Soon as I saw that,
I said, Don't do it.
Suze (14:45):
Well, there you go. That's your answer. Why shouldn't she
do it? KT?
KT (14:49):
Anything could happen to you and your partner, and you've
paid three years in advance of rent. It's, it's not
even your property.
Suze (14:57):
That's not the only reason.
KT (15:00):
All right, let's see what there's a whole lot of reasons.
You could do better things with that money.
Suze (15:06):
Give me another.
Who is she paying rent to?
KT (15:10):
I don't know.
Suze (15:10):
The landlord. What could happen to the landlord?
KT (15:14):
Landlord could be gone.
Suze (15:15):
They could be gone.
KT (15:16):
They could sell.
Suze (15:18):
They could have an accident. They could pass away.
KT (15:20):
All I know is the word rent was my red flag,
Suze (15:23):
But anything can happen. So given, why not,
the money that you would pay in advance and just
put it somewhere safe as your rent money making just
money market interest rates on it and just do that
with it. I obviously would be investing it at this
point in time because I do think after August and September,
(15:46):
which could be a little bit of rough months but
maybe not.
These markets still have a lot to go, but no,
that's such a waste of money. I cannot even tell you.
All right, go on.
KT (15:56):
Ok, next question from Donna. Hi, Suze and KT. Hope
you had a wonderful birthday, KT. I did. Donna
says thanks for delivering an interesting informative and fun podcast
to us twice each week. My question pertains to the must-have documents.
Suze (16:12):
KT wants to go to only once a week, so
you better tell her. You better say something.
KT (16:17):
My question pertains to the must-have documents and, and by
the way, for all of you that maybe missed my birthday.
We have a special and I believe the special is
for the whole month of July.
Suze (16:29):
No.
KT (16:29):
Oh, until when?
Suze (16:30):
It is 'till Sunday.
KT (16:31):
Oh, 'till this Sunday. Don't miss it. So I turned
I turned 73 and we were able to ask, Hey
house to please offer the must-have documents at $73 for
Suze's listeners, an incredible value.
Suze (16:49):
So you need to go to Musthavedocs.com/birthday
And until Sunday midnight Pacific time, that $73 is good again,
normally it's $99 for $2500 worth of state of the
art documents. KT, I'm sorry, I just have to say
(17:11):
something here which is.
You know, I watch the news in certain channels all
the time news channels. Then all the time there is
this advertisement for this trust and will program and everything
like that. Just a will for $169. What they also
don't tell you is that yearly.
They very well will charge you a renewal fee if
(17:32):
you want to change it or anything 35 a year.
But anyway, these are four documents a will, a trust,
an advance directive, and a durable power of attorney for
health care. You need all of them. But here's what
I love about this program. Any time we have an update, OK?
(17:53):
The update is free for you any time you want
to make a change,
you can go back as many times as you want
and change it and change it and change it over
all the years.
And best but not least, you can share it with
all your family members. This was never meant to be.
Every single one of you needs to
(18:13):
buy it.
KT (18:14):
No, it's shareware.
Suze (18:15):
It's Suze shareware, so only one of you needs to
buy it. You get an activation code. You give your
activation code to your family members, whoever it may be,
as many as you want really.
They then use the activation code, but they create their
own account, their own password, so they cannot see anything
(18:37):
that you have again $2500 worth of state of the
art documents good in all 50 states. Now if that
sounded like a plug for it, oh, it most certainly is.
And on Sunday I'm going to tell you a story
which is why I'm seriously now.
What would you say, KT? I'm just so knowing that
(19:00):
this is something that every single one of you needs.
You have
to have.
KT (19:05):
So, so Donna continues to say in the email, Currently
I have a living revocable trust that was created several
years ago. It's been updated a few times, including when
I moved to a different state. I'm wondering if I
should purchase the must-have documents with the special $73 birthday rate,
(19:26):
and use them next time I need to amend my
current trust instead of paying the hourly rate to an attorney.
Then the final question, is it possible to transfer my
existing trust into the must-have documents?
Suze (19:42):
And the
answer to that is no. It is not possible. Chances
are what you are going to have to do if
you want to do that, Donna, is when you get
the must-have docs, you're going to essentially start all over,
enter the information that you have in your trust now
into the
program so it is there for you. So when you
(20:03):
want to change it in the future, it's easy for
you to change it. You can access it. There's no
personal information, by the way, everybody in there. It's not
like you're putting in your bank account numbers or your addresses,
and it's just who you want to leave everything to
and how you want to leave it. So don't worry
about it. But then what you would have to do
(20:24):
is get everything notarized again.
Give everybody your banks and everything copies of your new trust,
and there you go because they always should have the
most updated copies of your wills and trusts. All right,
go on, KT.
KT (20:40):
And again, another must have question.
This is from Joanie. I love you gals. Thank you
for all your wonderful guidance through the years. I'm updating
my must-haves, which I originally completed in 2012. 1 thing
I'm confused about, this is a good question, Suze. Should
my IRAs, I have most of my funds in a
(21:02):
wroth and a bit in a traditional, be titled in
the name of the trust or my name?
Should I name my beneficiaries directly into the retirement accounts,
or should the trust be my beneficiary?
Suze (21:17):
So first of all, there is a reason why
an IRA stands for an individual retirement account whether it's
a Roth or a traditional meaning pre-tax, it's an IRA,
so you cannot name it in the name of the
trust because a trust is not an individual.
(21:39):
I would tell you that if in fact you are married,
all right, if you are married, your spouse absolutely should
be your primary beneficiary on any of your retirement accounts
cause they have certain rights that nobody else has in
terms of a contingent beneficiary.
(22:00):
If your children are of age, they're older, they're responsible,
whatever it may be, and let's say they're your secondary beneficiaries,
your contingent, your spouse being your first, if you don't
have a spouse, then your children who are absolutely capable,
they should be individually named if they are minors, however.
(22:22):
Then again your spouse would be the primary. The trust
would be the secondary or contingency. Or if you don't
have a spouse, then yes, your trust should be named
as the beneficiary if you have minor children, all right,
KT (22:40):
OK. Next question from Jenny. Suze, I just realized that
my husband is the primary account holder of our credit cards.
I'm not sure where I heard this, but I heard
that when you die, your credit
cards get canceled and your spouse, who was an authorized user,
will no longer be able to use the credit card.
Suze (23:00):
That is correct.
KT (23:01):
OK, we just retired and of course our income's lower.
I'm a little worried about applying for a new card
with me as the primary. Do you have any advice
for Jenny?
Suze (23:12):
The amount of income you have isn't really that important
when applying truthfully for a credit card.
What you would do is if you have a good
FICO score, a good credit score, and you apply, it
can be based on maybe low income, but what they're
really looking at is, have you been responsible with your bills?
(23:34):
Is it a good credit score? So I would just apply.
Many retirees do that and everything, and they'll get a credit.
It might not be for a big limit.
But that's how you would start if you get denied,
then apply for a secured credit card where you put
down a deposit into that credit card that secures it.
(23:56):
And you'll start building your credit that way. It is
not too late. You are to do it right after
this podcast is heard by you.
KT (24:04):
So Suze, next question is from TJ. Hi Suze, my
daughter's 22 and will be 23 next month. She refinanced
her car to pay off credit cards two years ago
against my advice.
She then called her father, who was down on his
luck at the time, agreed to help her pay the
car loan, but then he passed away last year, and
(24:27):
she was so depressed, ready, Suze, she maxed out her
credit cards again.
Now she's $15,000 in debt, a full-time student working a
part-time job three days a week and on the weekends.
Her credit cards are closed. She's on a payment plan
that she cannot afford, and she barely is meeting that obligation.
(24:49):
She can't afford gas in the car, personal items, or summer.
Time fun activities and I refuse to help. Good. I
think she has to feel this to learn from it.
What is your advice?
Suze (25:03):
Do exactly what you have
been doing TJ.
It's just that simple. Obviously, this is a woman who
needs to learn until she gets it and the only
way she's going to get
it is by letting her suffer. Go on, KT.
KT (25:19):
OK, this is from Tina. Dear Suze and staff, you
have always provided the best financial advice. Thank you. I
am a 57 year old nurse that would like to
open a Roth IRA using a former employer's 401k funds.
It's less than $20,000 she says. I am currently contributing
(25:43):
to another 401k plan with my current employer. Can you
please explain the process, or should I consider a rollover
with my current employer?
Suze (25:54):
Tina, here's what you need to know if you have
less than $20,000 in your former employer's 401k.
If you do roll it to a Roth IRA, you
are going to do what owe ordinary income tax on 100%
of that $20,000. If I were you, I would leave
(26:16):
it with your former employer for now, and I would
convert or roll $10,000 this year into a Roth IRA.
You'll owe income taxes on that.
And next year, because we're not that far away from
next year, believe it or not, I would then convert
the other $10,000 at that time. Then you would have
(26:39):
$20,000 in a Roth IRA. How do you do it?
Go to any brokerage firm like a Schwab, Fidelity, whatever
it may be. Open up a Roth IRA there and
just go from custodian
to custodian, they will help you do it. It's just
that simple. Now I just have to say for your
(27:01):
current contributions to your 401k, can you just make sure
they're to a Roth 401k? Can you just do me
that favor?
Otherwise you're going to have to nurse me.
KT (27:14):
And one final question, Suze, this is from Chad. I, I,
I thought this was kind of fun. It says hiring
an investment professional personally, I don't think he needs to,
but I'll read it to you. My name is Chad.
I've just turned 59. I'm wondering if I should hire
an investment professional to manage my retirement savings. I've always
(27:36):
directed my retirement savings to go into the S&P 500
mutual funds. I always
keep in mind what you've said about trusting your gut
when interviewing investors. I've interviewed four so far, two of
whom I really like, and I have one more I
still want to speak with. Their fees range from 1.1%
(27:57):
to 1.5% of total assets invested. Do you consider those
rates reasonable? Should I hire one of these investors or
leave my savings where they are?
That's Chad's question.
Suze (28:13):
Oh, Chad, Chad, Chad, listen, this is a hard one
because the truth of the matter is, let's say you
started in 2009 investing, let's just say $10,000 and you
just put it in the Standard and Poor's 500 index,
which maybe you did, right? Then, you know, to 2024,
(28:33):
those 15 years, it averaged about 17.1%. It did incredibly
well now.
If you missed the 2009 and you went into 2010,
it would only be like 12.1%, but either way, fabulous.
So for every $10,000 that you invested
(28:54):
versus what the asset manager may charge you either 1.1%
or 1.5%, it's going to cost you a serious sum
of money. Very few asset managers truthfully can outperform the
Janner and Poor's 500 index. Now that doesn't mean that
(29:16):
you shouldn't use a financial advisor and those things. However,
it's not just about liking them, Chad.
You need to ask what has their actual return been
for the past 10 or 15 years and to prove
it to you because if they're not making at least 5%
(29:37):
more than what the Standard and Poor's 500 index is
making for you, it is a waste of your money
and just to give you an example, over 15 years
for every $10,000 you would have invested.
It would be about $14,000 more if you left it
in the Standard and Poor's 500 index versus this 1.5% fee,
(30:02):
or even if it were a 1.1% fee, it would
be like $8000 difference. So,
I don't know... if you've been doing well.
I probably would just leave it with what you've been doing.
That's what I will tell you, all right, unless you
find a manager who can beat the 500 index, prove it,
(30:24):
prove it, prove
it, prove it.
KT (30:26):
All right, Suze, that's a wrap. That was a great one.
Suze (30:29):
All right now, KT, let's remind everybody,
that the offer at Alliant Credit Union for 4.3% APY
for a 12 month certificate is still available for amounts
of $75,000 or more. It's 4.35% APY.
(30:51):
So you should look into it and go to myalliant
A L L I A N T.com and check it out.
And again, you only have a few days left to
take advantage of Miss KT's birthday pricing of $73. Go
to
MustHavedocs.com/birthday, and that is where you get the must-have docs
(31:17):
and why do we call them that KT?
KT (31:19):
Because you must have them!
Suze (31:21):
All right. So until next time there's only one thing
we want you all to remember when it comes to
your money.
And that is this is the year to do what KT?
KT (31:32):
Make your money, make more money.
Suze (31:36):
And that's exactly what we are doing. All right, everybody,
see you soon. We love you.
KT (31:41):
Bye bye.
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Crime Junkie
Does hearing about a true crime case always leave you scouring the internet for the truth behind the story? Dive into your next mystery with Crime Junkie. Every Monday, join your host Ashley Flowers as she unravels all the details of infamous and underreported true crime cases with her best friend Brit Prawat. From cold cases to missing persons and heroes in our community who seek justice, Crime Junkie is your destination for theories and stories you won’t hear anywhere else. Whether you're a seasoned true crime enthusiast or new to the genre, you'll find yourself on the edge of your seat awaiting a new episode every Monday. If you can never get enough true crime... Congratulations, you’ve found your people. Follow to join a community of Crime Junkies! Crime Junkie is presented by audiochuck Media Company.