November 13, 2025 • 30 mins
On this highlights edition of Ask KT & Suze Anything, Suze answers questions about annuities, CD callbacks and medical debt. Plus, a Roth quizzy and so much more!
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Robert (00:07):
November 13th, 2025. Welcome to the Women in Money podcast
as well as everyone smart enough to listen. Hi, everybody,
this is Robert, the producer here.
You know how sometimes you need to take a day
off of work to handle an important thing happening in
your life. Everything's OK, but, you know, when these things
pop up, you have got to deal with them in
(00:27):
the moment. And that is the case for today. Suze
and KT are fine. They just need to handle a
logistics thing. And, you know, we still like you to
be able to hear both KT and Suze on a Thursday.
So we have some cool bits from an Ask KT
and Suze Anything previously released.
And we're gonna jump right into the first question. Take
(00:49):
it away, KT.
KT (00:52):
Sometimes I like to start with sharing what people have
achieved by just listening to Suze Orman's great advice, and
this is from Gina, and she said, after following your
rules for over 25 years, I was able to, now
get ready everybody, this is a list of 10 great
things that Gina has done. Number one, get out of
(01:15):
credit card debt for the third time.
Survive a painful divorce. The reason it was painful, Suze,
is because she paid her husband $100,000 almost 10 years
ago because she made more than him, but she survived that.
Suze (01:31):
KT, That's not why it was painful.
When you are married and you get divorced, any divorce
is painful because you originally entered that relationship in the
hopes that it was going to be as great as
ours or whatever. So that's what truly makes a divorce painful.
(01:51):
Money isn't what makes a divorce painful, truthfully, but it
still stings. All right, go on.
KT (01:57):
A hundred grand is a big sting. So number three, she paid off her
house at the age of 53, and now it's worth
almost a million dollars. Suze, She paid cash for a
car and she kept it for what's your favorite number?
Suze (02:13):
Well, my favorite number is 9 years. However, I would
like all of you to keep your cars for at
least 10. All right, go on.
KT (02:20):
And then she opened a Roth and saved 200,000. She
accumulated 1.8 million in her work 401k Roth. She has
250,000 in liquid savings, which I suppose could be her
emergency fund. And then she said she retired from a
(02:41):
job she hated at the age of 56 with a pension.
And since that retirement she can afford ready everyone, keyword
I can afford to exercise with a personal trainer. I
lost 35 pounds. I no longer have high cholesterol. I'm
working on getting off my high blood pressure medication.
(03:04):
And I did this all on my own, Susie, because
you taught me how to enjoy saving more than spending.
So Suze, Gina's 56. Congratulations, Gina. I love everything she
did
and continues to do.
Suze (03:23):
The thing I love most about you doing this, KT.
Is that so many times people feel so hopeless they
feel like no they can't do this they'll never get
out of debt they'll never be able to save they'll
never be able to recover from a divorce all of
these things and you can and you will...
KT (03:44):
Baby steps.
Suze (03:46):
...but the main thing that Gina said in that email,
is she gets more pleasure out of saving than she
does spending. When you feel less than everybody, you spend
more than you want to be more, you wanna have more,
you wanna feel like Gina and have security, cause that
(04:07):
is the goal of money. Then learn how to define
yourself by how you feel and who you are, and
not the things around you. All right.
KT (04:17):
OK, so now my first question is from Marietta. She said, hello,
Miss Orman. Marietta is being very proper. I have just
finished reading the transcript of your podcast Suze School Understanding Annuities,
which was on April 9, 2023. See, everyone, you can
(04:38):
go back and find exactly what you need. Marietta goes
on to say.
I am new to investing and recently started looking into annuities.
One thing puzzles me though, I was reading the advice
where you say that I should get an annuity with
an interest rate guaranteed for the entire surrender period.
(04:59):
I have noticed that some annuities offer a bonus rate
for one year, then they drop off to a lower rate.
How would I go about securing this higher bonus rate
for the length, I guess, for the duration of the
surrender period?
Suze (05:14):
Yeah, first of all, Marietta, if you heard me say
that I want you to get an annuity.
I don't want you to get annuities. Actually, I find
it very difficult to find a situation where an annuity
in any place now makes sense. However, if you want
to get an annuity for whatever reason, because all annuities
(05:39):
have what's called a surrender period where you cannot come
out of that annuity without a penalty, usually 7% the
first year, 6, 5, 4%, whatever it may be.
So if you're going to for whatever reason get an annuity,
get an annuity where the surrender period and the interest
(06:02):
rate that they are offering you is for the exact
same period of time. Now companies may not do that anymore.
It used to be called a CD annuity, so they
sucker you in, however, in your example here in this email.
Of offering you a bonus rate for the first year,
then they drop you down all the other years during
(06:23):
the surrender period to make up for that bonus rate
that got you to go with them to begin with.
My best advice I could give you is, since you're
probably very new to investing, stay away from annuities. I
doubt there's any reason that you really need one. That's
number one.
Number two, if for whatever reason you do get an annuity,
(06:45):
only get an annuity, which is a fixed annuity where
the interest rate is fixed for the entire length of
the surrender period. If you can't find one like that,
don't buy it at all.
All right, next, KT,
KT (07:02):
So the next email is from Kim. Hi Suze, I
recently started listening to your podcast after discovering my parents,
who are 80 and 81, bought a $200,000 deferred annuity
upon recommendation from the financial advisor. My mom asked me
(07:22):
what I knew about annuities, and I don't think she
realized it was already purchased.
Ready, Suze. My parents are extremely secretive about all of
their finances. They have five children, and I am the
financial power of attorney, but they don't tell me anything.
I've never met their financial adviser, who is the grandson
(07:44):
of an old family attorney who passed a few years ago.
They put all of their trust in him.
So Kim's question is on behalf of herself and siblings,
what can we do to help my parents realize they
need to trust their family to be involved in their finances?
Suze (08:04):
Mhm.
So Kim, what's interesting is that no matter how old
we get or our parents get, we tend to act
like we're still kids.
We tend to act that we cannot question their authority,
that we have to do anything that they say. We
(08:25):
act like we're 10 years old, 12 years old, 18
years old, when we really were kids.
You now and all your siblings are mature adults. If
your parents are in their 80s, then you are probably
in your 50s, maybe even in your 60s. You are
no longer kids. Therefore, you have to stop acting like
(08:49):
one and just being around them and doing whatever they say.
What I suggest to you and everybody listening to this
right now, your parents are in danger.
They're in danger. Therefore, you have got to go to them,
sit them down, all of you at once, and say,
(09:10):
Let's play getting older. Mom, what would you do if
Dad dies? Cause it's not an if, Mom, it's a when.
Do you know where your money is going to come from?
Do you know how much it costs you to live
every single month? Do you know about the titles to
(09:30):
all your accounts and retirement accounts, Mom, will you be OK?
And Mom?
Let's just say Dad is gone, or Dad, let's just
say mom is gone or has become incapacitated. Who's going
to write your checks for you? Who is going to
pay your bills for you, Mom and Dad, this is
(09:52):
not about how much money you have and how much
money you are going to leave to us.
This is about your children being able to take care
of you as you age, and the two of you
are putting yourself in danger. Kim, ask your parents to
(10:13):
listen to this podcast.
Ask them to listen to Suze Orman saying to them,
Mom and Dad, please don't do this to your kids.
How many thousands of kids have come to me when
their parents had gotten sick or had a stroke or
had whatever it may be, and they can't pay the bills,
(10:35):
they can't do anything for them. Everybody now is in danger.
Please, Mom and Dad, stop acting so immature that you
just don't want to deal with this cause I know
that you're afraid to deal with your death. I know
that you are afraid to make decisions cause it's hard
(10:58):
to get old. I know that KT and I both
experienced that, but you don't have a choice anymore, so
I am not asking you. I am begging you.
To bring your five kids in who love you, especially Kim,
who has power of attorney. Introduce Kim to your financial advisor.
(11:23):
And make sure that the decisions that you are making
or this person is making for you are wise for you,
because on no level is it wise that you have
a $200,000 annuity. On no level is it wise for
you to have any annuities at all. And just because
(11:44):
his grandfather was your attorney doesn't mean that the grandson
is just like his grandfather. Please, I am begging you
and all parents that are listening to this right now.
Next question, KT.
KT (12:04):
So next is from Emily, Suze. Love, love, love, love
your podcast, Suze.
Suze (12:10):
I love it too, Emily,
KT (12:11):
And this is
a really good question because I'm curious too. Suze, how
did I miss that CDs can be called back? Was
this ever discussed on your podcast? I have received a
notice from Chase that my CD was being recalled and
money to be cashed out at 9 months instead of
my 12 month expiration date.
(12:34):
So Suze, Emily says, why didn't I know this?
Suze (12:36):
You didn't know it, Emily, because you don't listen to
the podcast every Thursday and Sunday or any time in
between then. So just so you know, I have addressed
this in the past.
And basically, the reason a financial institution has what's called
a callable CD is because when interest rates go down,
(13:00):
they want to know that they don't have to continue
paying you that high interest rate because they want to
be able to recall it, so that if you do
get another CD it's at a lower interest rate and
that's how they make more money.
Now, most financial institutions such as banks and even brokerage
(13:22):
firms offer callable CDs, and sometimes to sucker you in,
they offer a little tiny higher interest rate than a
CD that is not callable, and you fall for that trick.
You should never, ever, ever get a callable CD.
(13:43):
But they are plentiful out there, so you just have
to ask the question before you buy a CD. Is
this callable or not?
KT (13:54):
Does Alliant do that?
Suze (13:55):
No, Alliant would not offer callable CDs because really they're
for the advantage of the financial institution. There is no
advantage really for a consumer to buy one, and Alliant
Credit Union, in my opinion, would never do anything,
anything that wasn't for the advantage of their members. Go to my alliant.com.
KT (14:22):
All right. All right. Next is from Sylvia. Suze, I
have a traditional IRA and a Roth IRA with Charles Schwab.
The traditionals doing really bad.
She said, I would like to choose investments myself following
the advice of your podcast, but I don't know how
to take control of my account. How, you know, help her?
(14:45):
How does she do that?
Suze (14:46):
Sylvia, do you have control over your Roth IRA? This
has nothing to do with Charles Schwab. This has to
do with who is making the decisions over your retirement accounts.
So if your Roth IRA is doing well.
And your traditional IRA is not. I have a feeling
(15:08):
that probably you just recently started a Roth IRA and
there isn't a lot of money in there, but there's
probably a whole lot more in your traditional IRA. So,
how do you take that over? You just tell whoever
is in charge of that account that you no longer
want them to be so. So, therefore, you pick up
(15:29):
the phone.
You gather your courage and you say you no longer
want the traditional IRA under an investment advisor. However, I
do just want to say, if it's really doing bad,
now might be the time to take some of the
money that's in the traditional IRA and convert it to
a Roth every single year. Now, I just also have
(15:53):
to say this,
it wouldn't kill you possibly, I don't know enough about
your circumstance, but to take small amounts of money at
the end of this year in the things that are
especially down and you're losing on and convert them to
your wrath and then do the same thing at the
(16:15):
beginning of January next year. So that's what I would
be doing if I were you, KT. Why do you
think it's so hard for women,
to take power like, did, did she really need to
me to say that how does she do that?
KT (16:35):
A lot of people, men and women are afraid to
ask questions or to question anything that has to do
with finances and don't ask me why. I don't know.
I mean, for me, I love to ask questions about
money and I have no fear, but most people do.
Suze (16:52):
So listen, here's the bottom line for all of you.
It is your money. What happens to your money directly
affects the quality of your life. How many times have
I said this? Not your financial advisor's life, your insurance
agent's life, your banker's life, your life. So, if you
don't like what's happening to your money, do not be
(17:16):
afraid to pick up the phone and talk to whoever
is in charge of that money.
If you don't like what's happening to your money and
you're the one who's in control of it, then maybe
you do need to find somebody who could help you.
All right, KT.
KT (17:34):
OK. Next is from Cecilia. She said, Suze, your podcast
has been a true gift. Love that. She said, When
I left my company, I had a 90 day window
to exercise my vested stock options.
Just before they expired, an acquisition was announced, but I
(17:55):
had no guarantees about the deal closing or a written
confirmation on the equity payout. The cost to exercise was
$193,000 with a net gain of $122,000.
I could have used my home equity line of credit
to fund it, but I decided against it to avoid
(18:19):
potential financial stress on my family. So now, now she's
regretting it. She said, I can't help but feel unlucky
for not seizing that upside. So Suze, how do I
move past this and stop dwelling on what could have been?
Another could have, should have, would have email.
Suze (18:37):
Yeah, so basically, Cecilia.
There is a law of money that I have which
is look at what you have, not at what you
had or you could have had.
If you spend all of your life buying a stock,
you then sell it cause you made maybe some money
on it, or you lost money on it, and then
(18:59):
it skyrockets, and if you had simply held it, you
would have made $100,000 200,000 dollars. I did an entire
podcast on, if only.
Try to find that podcast. If only I had done
this and not that. If only I had exercised those options,
(19:21):
I would be $122,000 richer. If only, if only. Now,
what you could have done.
But you didn't even ask the questions to your HR
person because you were coming from a place of fear.
You wanted to make sure that you stayed secure. You
(19:42):
didn't want to take equity out of your home, but
you didn't ask the company questions such as how can
I do this if I don't have any money. There
are many companies out there,
that have what's called a cashless transaction to help you
(20:03):
exercise when you don't have the cash to do so.
Did you even ask that question of your company? So
for all of you again listening to this and maybe
you're in a situation like Cecilia is in or was in.
And maybe you will be in is, can you ask
your company now that if they ever do something like that,
(20:26):
you have stock options? Do they offer something that's a
cashless transaction? Can you do that? But Cecilia, why waste
time on what could have been,
versus what is? You didn't do it because you didn't
(20:48):
want to cause any financial stress on your family, and
now it's causing stress on you. No, girlfriend, look at
what you have.
Which should be a life of no stress. So, therefore,
just stop it, but again, listen to the podcast on
(21:10):
If Only. All right, KT.
KT (21:13):
Next question. This is from Susan.
I am 45 years old and I've been with Walmart
for nine years. We love Walmart. Wonder if she's been
to Bentonville.
Suze (21:25):
We have.
KT (21:26):
Suze and I've been to Bentonville. There's some great barbecue
places there. So I'm leaving Walmart and I have $45,000
in the 401k and I have stocks with them, and
the new job I'm going to has a 401k also.
Do I have to transfer my Walmart 401k to the
(21:47):
new job, or can I open a Roth IRA with Fidelity?
Suze (21:53):
So, first of all, Susan, right, if you choose to
roll over your 401k to your new company, that's fine, right?
But the problem is, chances are, they're not going to
be able to take the Walmart stock that you have
within your 401k. I would suggest doing an IRA rollover
(22:19):
to Fidelity with all of it.
And then, if you want, start to convert little by
little to a Roth IRA cause if you roll it
all over to a Roth IRA then all $45,000 is
gonna be taxable to you that year as ordinary income.
(22:41):
You also, by the way, have the ability to leave
it right at Walmart if that is what you would
like to do. Next question, my dear KT.
KT (22:51):
OK, this question was on the wall, and it's to KT.
Suze (22:54):
And it is the last one.
KT (22:57):
It says, KT, if you still have money in an
HSA account when you start receiving Medicare, do you lose it?
I'm gonna answer this for you, for them. Is that
all right, Suze? The answer is no. You don't lose it.
(23:20):
You just add to it. You don't lose it.
There you go. I know a lot about HSAs
Suze (23:28):
Ding ding ding, but you're still getting a...
girlfriend. But wait, wait, wait, I'm not there yet. Let
me answer Miss Speedy today. So it is true.
That you can use your HSA money for anything that
you want, but did you also know that you can
use your health savings account funds to pay for Medicare premiums, everybody,
(23:53):
including those for Part B, Part D, and Medicare Advantage
plans Part C.
Right, but you need to know, KT, this should have
been your quizzy. Can you use HSA funds to pay
for Medicare supplements or Mediagap policies since you know so
much about these funds?
KT (24:13):
Oh, I don't know that much.
Suze (24:16):
And the answer to that is no, you cannot.
KT (24:19):
Sounds like a no, right?
Suze (24:20):
So just remember that when you have money in an
HSA you can use it for so many things including
long term care, premiums, everybody. All right, quizzy time, you
need to get out of your quizzy, you little manipulator. Right,
which is this from Darlene.
(24:40):
And by now, all of you know what quizzy time means.
If not, that means you have not been listening to
the podcast and go back and listen to a lot
of them. Anyway, all right. If I do a Roth
conversion from a traditional IRA even though I'm 67,
(25:03):
would I have to pay income taxes on the withdrawal
amount if I took it out before the five year
rule since I paid income taxes on it when I
converted it to a Roth? Don't answer yet, KT. What
Darlene is asking is
(25:26):
But the Roth has not been open for at least
5 years. She has converted money to it. She is 67.
If she converts and then takes the money out, let's
say she leaves it in there for a year from now.
It grows, but it's still under the five years.
(25:51):
Will she owe income tax on that money and will
she owe a 10% penalty on that money?
KT (25:59):
Do you mean both or...
Suze (26:00):
I'm asking you both.
KT (26:05):
Well, I don't know. All I know is that if
taxes are involved, usually you have to pay it.
Suze (26:10):
So she will have paid the taxes when she converted.
She already pay them again. You have to answer the questions.
If she withdraws the money prior to when the five
years are up and that money has grown, let's just
say it's grown and she withdraws it prior to the
time the five years are up, she's 67.
(26:34):
Will she owe a 10% penalty? Will she owe income
tax on that money?
KT (26:39):
She's 67, so I think she won't owe income tax,
but she might have the penalty. I don't know.
Is that a good, is that a good answer?
Suze (26:50):
It's that it's only good if it's good for you.
KT (26:52):
Is it, uh, is
Suze (26:53):
I have to tell you whether you're right or wrong.
Do not try to get out of this.
KT (27:00):
I don't think, I don't think you pay...
I don't think you pay taxes twice, but you definitely
have a penalty. But she's 67, so I don't think
she's penalty exempt either.
Suze (27:11):
All right, that's your answer. (Suze makes the wrong answer sound)
KT (27:15):
OK, I, I don't know. It was Roth, right?
All right,
Suze (27:21):
We should just know that any Roth question, it's gonna be a (Suze makes the wrong answer sound again).
KT (27:25):
You can bet on that, everybody.
Suze (27:28):
It doesn't have to be though, KT. So Darlene, here's
what you have to get. Once you are over the
age of 59 and a half.
Even though your Roth IRAs have not been open for
at least five years, everybody, so this applies to everybody,
you will no longer ever, ever, ever pay a 10%
(27:50):
penalty cause you're already over the age of 59 and a half. However,
what you have to remember is that when you convert
money to a Roth IRA you pay 100% tax on
the amount that you converted, but now the money's in
that account and it is growing, so it is earning money.
(28:14):
If you take out the earnings before the account has
been open for five years.
Then you are going to pay tax on the earnings
that you have never paid tax on yet. So that's
just what you have to take into consideration. It's just
(28:35):
that easy. Now, did that make sense to you, KT?
KT (28:38):
Yeah, that made a lot of sense.
Suze (28:40):
Really, I just made sense to you.
KT (28:42):
What made sense, I think my, the thing, and I
knew I couldn't remember...
Suze (28:48):
There she goes defending herself again.
KT (28:49):
No, I knew that 67 was a good thing, but
I didn't remember how it all worked.
Suze (28:53):
We, we get that because I went (Suze makes the wrong answer sound... again)
Do you see everybody now? I just want...
KT (29:00):
I'm not defending myself. I'm just trying to...
Suze (29:02):
Well, what would you call
that?
KT (29:03):
Recall.
Suze (29:04):
Uh-huh. Now, can you just imagine what our relationship is
really like? Do you think this just happens when we're
talking about Roth IRAs?
Or maybe do you think it could happen about other
things you, you think KT never
KT (29:19):
Ding ding
ding ding ding
ding ding ding. Suze got that right ding ding ding
ding
Suze (29:24):
All right, but I still love her and more importantly,
I like her.
Take us out, KT.
KT (29:32):
All right, these three things, what do they have to remember?
Suze (29:35):
People first, then money, then things. And when you're wrong,
just admit it. It's not a big deal. What are
the six greatest words in life, KT?
KT (29:47):
I admit that I was wrong.
Suze (29:49):
Ding ding ding. And if you do that, stay safe, healthy.
You will be unstoppable.
November 13th, 2025. Welcome to the Women in Money podcast
as well as everyone smart enough to listen. Hi, everybody,
this is Robert, the producer here.
You know how sometimes you need to take a day
off of work to handle an important thing happening in
your life. Everything's OK, but, you know, when these things
pop up, you have got to deal with them in
(00:27):
the moment. And that is the case for today. Suze
and KT are fine. They just need to handle a
logistics thing. And, you know, we still like you to
be able to hear both KT and Suze on a Thursday.
So we have some cool bits from an Ask KT
and Suze Anything previously released.
And we're gonna jump right into the first question. Take
(00:49):
it away, KT.
KT (00:52):
Sometimes I like to start with sharing what people have
achieved by just listening to Suze Orman's great advice, and
this is from Gina, and she said, after following your
rules for over 25 years, I was able to, now
get ready everybody, this is a list of 10 great
things that Gina has done. Number one, get out of
(01:15):
credit card debt for the third time.
Survive a painful divorce. The reason it was painful, Suze,
is because she paid her husband $100,000 almost 10 years
ago because she made more than him, but she survived that.
Suze (01:31):
KT, That's not why it was painful.
When you are married and you get divorced, any divorce
is painful because you originally entered that relationship in the
hopes that it was going to be as great as
ours or whatever. So that's what truly makes a divorce painful.
(01:51):
Money isn't what makes a divorce painful, truthfully, but it
still stings. All right, go on.
KT (01:57):
A hundred grand is a big sting. So number three, she paid off her
house at the age of 53, and now it's worth
almost a million dollars. Suze, She paid cash for a
car and she kept it for what's your favorite number?
Suze (02:13):
Well, my favorite number is 9 years. However, I would
like all of you to keep your cars for at
least 10. All right, go on.
KT (02:20):
And then she opened a Roth and saved 200,000. She
accumulated 1.8 million in her work 401k Roth. She has
250,000 in liquid savings, which I suppose could be her
emergency fund. And then she said she retired from a
(02:41):
job she hated at the age of 56 with a pension.
And since that retirement she can afford ready everyone, keyword
I can afford to exercise with a personal trainer. I
lost 35 pounds. I no longer have high cholesterol. I'm
working on getting off my high blood pressure medication.
(03:04):
And I did this all on my own, Susie, because
you taught me how to enjoy saving more than spending.
So Suze, Gina's 56. Congratulations, Gina. I love everything she
did
and continues to do.
Suze (03:23):
The thing I love most about you doing this, KT.
Is that so many times people feel so hopeless they
feel like no they can't do this they'll never get
out of debt they'll never be able to save they'll
never be able to recover from a divorce all of
these things and you can and you will...
KT (03:44):
Baby steps.
Suze (03:46):
...but the main thing that Gina said in that email,
is she gets more pleasure out of saving than she
does spending. When you feel less than everybody, you spend
more than you want to be more, you wanna have more,
you wanna feel like Gina and have security, cause that
(04:07):
is the goal of money. Then learn how to define
yourself by how you feel and who you are, and
not the things around you. All right.
KT (04:17):
OK, so now my first question is from Marietta. She said, hello,
Miss Orman. Marietta is being very proper. I have just
finished reading the transcript of your podcast Suze School Understanding Annuities,
which was on April 9, 2023. See, everyone, you can
(04:38):
go back and find exactly what you need. Marietta goes
on to say.
I am new to investing and recently started looking into annuities.
One thing puzzles me though, I was reading the advice
where you say that I should get an annuity with
an interest rate guaranteed for the entire surrender period.
(04:59):
I have noticed that some annuities offer a bonus rate
for one year, then they drop off to a lower rate.
How would I go about securing this higher bonus rate
for the length, I guess, for the duration of the
surrender period?
Suze (05:14):
Yeah, first of all, Marietta, if you heard me say
that I want you to get an annuity.
I don't want you to get annuities. Actually, I find
it very difficult to find a situation where an annuity
in any place now makes sense. However, if you want
to get an annuity for whatever reason, because all annuities
(05:39):
have what's called a surrender period where you cannot come
out of that annuity without a penalty, usually 7% the
first year, 6, 5, 4%, whatever it may be.
So if you're going to for whatever reason get an annuity,
get an annuity where the surrender period and the interest
(06:02):
rate that they are offering you is for the exact
same period of time. Now companies may not do that anymore.
It used to be called a CD annuity, so they
sucker you in, however, in your example here in this email.
Of offering you a bonus rate for the first year,
then they drop you down all the other years during
(06:23):
the surrender period to make up for that bonus rate
that got you to go with them to begin with.
My best advice I could give you is, since you're
probably very new to investing, stay away from annuities. I
doubt there's any reason that you really need one. That's
number one.
Number two, if for whatever reason you do get an annuity,
(06:45):
only get an annuity, which is a fixed annuity where
the interest rate is fixed for the entire length of
the surrender period. If you can't find one like that,
don't buy it at all.
All right, next, KT,
KT (07:02):
So the next email is from Kim. Hi Suze, I
recently started listening to your podcast after discovering my parents,
who are 80 and 81, bought a $200,000 deferred annuity
upon recommendation from the financial advisor. My mom asked me
(07:22):
what I knew about annuities, and I don't think she
realized it was already purchased.
Ready, Suze. My parents are extremely secretive about all of
their finances. They have five children, and I am the
financial power of attorney, but they don't tell me anything.
I've never met their financial adviser, who is the grandson
(07:44):
of an old family attorney who passed a few years ago.
They put all of their trust in him.
So Kim's question is on behalf of herself and siblings,
what can we do to help my parents realize they
need to trust their family to be involved in their finances?
Suze (08:04):
Mhm.
So Kim, what's interesting is that no matter how old
we get or our parents get, we tend to act
like we're still kids.
We tend to act that we cannot question their authority,
that we have to do anything that they say. We
(08:25):
act like we're 10 years old, 12 years old, 18
years old, when we really were kids.
You now and all your siblings are mature adults. If
your parents are in their 80s, then you are probably
in your 50s, maybe even in your 60s. You are
no longer kids. Therefore, you have to stop acting like
(08:49):
one and just being around them and doing whatever they say.
What I suggest to you and everybody listening to this
right now, your parents are in danger.
They're in danger. Therefore, you have got to go to them,
sit them down, all of you at once, and say,
(09:10):
Let's play getting older. Mom, what would you do if
Dad dies? Cause it's not an if, Mom, it's a when.
Do you know where your money is going to come from?
Do you know how much it costs you to live
every single month? Do you know about the titles to
(09:30):
all your accounts and retirement accounts, Mom, will you be OK?
And Mom?
Let's just say Dad is gone, or Dad, let's just
say mom is gone or has become incapacitated. Who's going
to write your checks for you? Who is going to
pay your bills for you, Mom and Dad, this is
(09:52):
not about how much money you have and how much
money you are going to leave to us.
This is about your children being able to take care
of you as you age, and the two of you
are putting yourself in danger. Kim, ask your parents to
(10:13):
listen to this podcast.
Ask them to listen to Suze Orman saying to them,
Mom and Dad, please don't do this to your kids.
How many thousands of kids have come to me when
their parents had gotten sick or had a stroke or
had whatever it may be, and they can't pay the bills,
(10:35):
they can't do anything for them. Everybody now is in danger.
Please, Mom and Dad, stop acting so immature that you
just don't want to deal with this cause I know
that you're afraid to deal with your death. I know
that you are afraid to make decisions cause it's hard
(10:58):
to get old. I know that KT and I both
experienced that, but you don't have a choice anymore, so
I am not asking you. I am begging you.
To bring your five kids in who love you, especially Kim,
who has power of attorney. Introduce Kim to your financial advisor.
(11:23):
And make sure that the decisions that you are making
or this person is making for you are wise for you,
because on no level is it wise that you have
a $200,000 annuity. On no level is it wise for
you to have any annuities at all. And just because
(11:44):
his grandfather was your attorney doesn't mean that the grandson
is just like his grandfather. Please, I am begging you
and all parents that are listening to this right now.
Next question, KT.
KT (12:04):
So next is from Emily, Suze. Love, love, love, love
your podcast, Suze.
Suze (12:10):
I love it too, Emily,
KT (12:11):
And this is
a really good question because I'm curious too. Suze, how
did I miss that CDs can be called back? Was
this ever discussed on your podcast? I have received a
notice from Chase that my CD was being recalled and
money to be cashed out at 9 months instead of
my 12 month expiration date.
(12:34):
So Suze, Emily says, why didn't I know this?
Suze (12:36):
You didn't know it, Emily, because you don't listen to
the podcast every Thursday and Sunday or any time in
between then. So just so you know, I have addressed
this in the past.
And basically, the reason a financial institution has what's called
a callable CD is because when interest rates go down,
(13:00):
they want to know that they don't have to continue
paying you that high interest rate because they want to
be able to recall it, so that if you do
get another CD it's at a lower interest rate and
that's how they make more money.
Now, most financial institutions such as banks and even brokerage
(13:22):
firms offer callable CDs, and sometimes to sucker you in,
they offer a little tiny higher interest rate than a
CD that is not callable, and you fall for that trick.
You should never, ever, ever get a callable CD.
(13:43):
But they are plentiful out there, so you just have
to ask the question before you buy a CD. Is
this callable or not?
KT (13:54):
Does Alliant do that?
Suze (13:55):
No, Alliant would not offer callable CDs because really they're
for the advantage of the financial institution. There is no
advantage really for a consumer to buy one, and Alliant
Credit Union, in my opinion, would never do anything,
anything that wasn't for the advantage of their members. Go to my alliant.com.
KT (14:22):
All right. All right. Next is from Sylvia. Suze, I
have a traditional IRA and a Roth IRA with Charles Schwab.
The traditionals doing really bad.
She said, I would like to choose investments myself following
the advice of your podcast, but I don't know how
to take control of my account. How, you know, help her?
(14:45):
How does she do that?
Suze (14:46):
Sylvia, do you have control over your Roth IRA? This
has nothing to do with Charles Schwab. This has to
do with who is making the decisions over your retirement accounts.
So if your Roth IRA is doing well.
And your traditional IRA is not. I have a feeling
(15:08):
that probably you just recently started a Roth IRA and
there isn't a lot of money in there, but there's
probably a whole lot more in your traditional IRA. So,
how do you take that over? You just tell whoever
is in charge of that account that you no longer
want them to be so. So, therefore, you pick up
(15:29):
the phone.
You gather your courage and you say you no longer
want the traditional IRA under an investment advisor. However, I
do just want to say, if it's really doing bad,
now might be the time to take some of the
money that's in the traditional IRA and convert it to
a Roth every single year. Now, I just also have
(15:53):
to say this,
it wouldn't kill you possibly, I don't know enough about
your circumstance, but to take small amounts of money at
the end of this year in the things that are
especially down and you're losing on and convert them to
your wrath and then do the same thing at the
(16:15):
beginning of January next year. So that's what I would
be doing if I were you, KT. Why do you
think it's so hard for women,
to take power like, did, did she really need to
me to say that how does she do that?
KT (16:35):
A lot of people, men and women are afraid to
ask questions or to question anything that has to do
with finances and don't ask me why. I don't know.
I mean, for me, I love to ask questions about
money and I have no fear, but most people do.
Suze (16:52):
So listen, here's the bottom line for all of you.
It is your money. What happens to your money directly
affects the quality of your life. How many times have
I said this? Not your financial advisor's life, your insurance
agent's life, your banker's life, your life. So, if you
don't like what's happening to your money, do not be
(17:16):
afraid to pick up the phone and talk to whoever
is in charge of that money.
If you don't like what's happening to your money and
you're the one who's in control of it, then maybe
you do need to find somebody who could help you.
All right, KT.
KT (17:34):
OK. Next is from Cecilia. She said, Suze, your podcast
has been a true gift. Love that. She said, When
I left my company, I had a 90 day window
to exercise my vested stock options.
Just before they expired, an acquisition was announced, but I
(17:55):
had no guarantees about the deal closing or a written
confirmation on the equity payout. The cost to exercise was
$193,000 with a net gain of $122,000.
I could have used my home equity line of credit
to fund it, but I decided against it to avoid
(18:19):
potential financial stress on my family. So now, now she's
regretting it. She said, I can't help but feel unlucky
for not seizing that upside. So Suze, how do I
move past this and stop dwelling on what could have been?
Another could have, should have, would have email.
Suze (18:37):
Yeah, so basically, Cecilia.
There is a law of money that I have which
is look at what you have, not at what you
had or you could have had.
If you spend all of your life buying a stock,
you then sell it cause you made maybe some money
on it, or you lost money on it, and then
(18:59):
it skyrockets, and if you had simply held it, you
would have made $100,000 200,000 dollars. I did an entire
podcast on, if only.
Try to find that podcast. If only I had done
this and not that. If only I had exercised those options,
(19:21):
I would be $122,000 richer. If only, if only. Now,
what you could have done.
But you didn't even ask the questions to your HR
person because you were coming from a place of fear.
You wanted to make sure that you stayed secure. You
(19:42):
didn't want to take equity out of your home, but
you didn't ask the company questions such as how can
I do this if I don't have any money. There
are many companies out there,
that have what's called a cashless transaction to help you
(20:03):
exercise when you don't have the cash to do so.
Did you even ask that question of your company? So
for all of you again listening to this and maybe
you're in a situation like Cecilia is in or was in.
And maybe you will be in is, can you ask
your company now that if they ever do something like that,
(20:26):
you have stock options? Do they offer something that's a
cashless transaction? Can you do that? But Cecilia, why waste
time on what could have been,
versus what is? You didn't do it because you didn't
(20:48):
want to cause any financial stress on your family, and
now it's causing stress on you. No, girlfriend, look at
what you have.
Which should be a life of no stress. So, therefore,
just stop it, but again, listen to the podcast on
(21:10):
If Only. All right, KT.
KT (21:13):
Next question. This is from Susan.
I am 45 years old and I've been with Walmart
for nine years. We love Walmart. Wonder if she's been
to Bentonville.
Suze (21:25):
We have.
KT (21:26):
Suze and I've been to Bentonville. There's some great barbecue
places there. So I'm leaving Walmart and I have $45,000
in the 401k and I have stocks with them, and
the new job I'm going to has a 401k also.
Do I have to transfer my Walmart 401k to the
(21:47):
new job, or can I open a Roth IRA with Fidelity?
Suze (21:53):
So, first of all, Susan, right, if you choose to
roll over your 401k to your new company, that's fine, right?
But the problem is, chances are, they're not going to
be able to take the Walmart stock that you have
within your 401k. I would suggest doing an IRA rollover
(22:19):
to Fidelity with all of it.
And then, if you want, start to convert little by
little to a Roth IRA cause if you roll it
all over to a Roth IRA then all $45,000 is
gonna be taxable to you that year as ordinary income.
(22:41):
You also, by the way, have the ability to leave
it right at Walmart if that is what you would
like to do. Next question, my dear KT.
KT (22:51):
OK, this question was on the wall, and it's to KT.
Suze (22:54):
And it is the last one.
KT (22:57):
It says, KT, if you still have money in an
HSA account when you start receiving Medicare, do you lose it?
I'm gonna answer this for you, for them. Is that
all right, Suze? The answer is no. You don't lose it.
(23:20):
You just add to it. You don't lose it.
There you go. I know a lot about HSAs
Suze (23:28):
Ding ding ding, but you're still getting a...
girlfriend. But wait, wait, wait, I'm not there yet. Let
me answer Miss Speedy today. So it is true.
That you can use your HSA money for anything that
you want, but did you also know that you can
use your health savings account funds to pay for Medicare premiums, everybody,
(23:53):
including those for Part B, Part D, and Medicare Advantage
plans Part C.
Right, but you need to know, KT, this should have
been your quizzy. Can you use HSA funds to pay
for Medicare supplements or Mediagap policies since you know so
much about these funds?
KT (24:13):
Oh, I don't know that much.
Suze (24:16):
And the answer to that is no, you cannot.
KT (24:19):
Sounds like a no, right?
Suze (24:20):
So just remember that when you have money in an
HSA you can use it for so many things including
long term care, premiums, everybody. All right, quizzy time, you
need to get out of your quizzy, you little manipulator. Right,
which is this from Darlene.
(24:40):
And by now, all of you know what quizzy time means.
If not, that means you have not been listening to
the podcast and go back and listen to a lot
of them. Anyway, all right. If I do a Roth
conversion from a traditional IRA even though I'm 67,
(25:03):
would I have to pay income taxes on the withdrawal
amount if I took it out before the five year
rule since I paid income taxes on it when I
converted it to a Roth? Don't answer yet, KT. What
Darlene is asking is
(25:26):
But the Roth has not been open for at least
5 years. She has converted money to it. She is 67.
If she converts and then takes the money out, let's
say she leaves it in there for a year from now.
It grows, but it's still under the five years.
(25:51):
Will she owe income tax on that money and will
she owe a 10% penalty on that money?
KT (25:59):
Do you mean both or...
Suze (26:00):
I'm asking you both.
KT (26:05):
Well, I don't know. All I know is that if
taxes are involved, usually you have to pay it.
Suze (26:10):
So she will have paid the taxes when she converted.
She already pay them again. You have to answer the questions.
If she withdraws the money prior to when the five
years are up and that money has grown, let's just
say it's grown and she withdraws it prior to the
time the five years are up, she's 67.
(26:34):
Will she owe a 10% penalty? Will she owe income
tax on that money?
KT (26:39):
She's 67, so I think she won't owe income tax,
but she might have the penalty. I don't know.
Is that a good, is that a good answer?
Suze (26:50):
It's that it's only good if it's good for you.
KT (26:52):
Is it, uh, is
Suze (26:53):
I have to tell you whether you're right or wrong.
Do not try to get out of this.
KT (27:00):
I don't think, I don't think you pay...
I don't think you pay taxes twice, but you definitely
have a penalty. But she's 67, so I don't think
she's penalty exempt either.
Suze (27:11):
All right, that's your answer. (Suze makes the wrong answer sound)
KT (27:15):
OK, I, I don't know. It was Roth, right?
All right,
Suze (27:21):
We should just know that any Roth question, it's gonna be a (Suze makes the wrong answer sound again).
KT (27:25):
You can bet on that, everybody.
Suze (27:28):
It doesn't have to be though, KT. So Darlene, here's
what you have to get. Once you are over the
age of 59 and a half.
Even though your Roth IRAs have not been open for
at least five years, everybody, so this applies to everybody,
you will no longer ever, ever, ever pay a 10%
(27:50):
penalty cause you're already over the age of 59 and a half. However,
what you have to remember is that when you convert
money to a Roth IRA you pay 100% tax on
the amount that you converted, but now the money's in
that account and it is growing, so it is earning money.
(28:14):
If you take out the earnings before the account has
been open for five years.
Then you are going to pay tax on the earnings
that you have never paid tax on yet. So that's
just what you have to take into consideration. It's just
(28:35):
that easy. Now, did that make sense to you, KT?
KT (28:38):
Yeah, that made a lot of sense.
Suze (28:40):
Really, I just made sense to you.
KT (28:42):
What made sense, I think my, the thing, and I
knew I couldn't remember...
Suze (28:48):
There she goes defending herself again.
KT (28:49):
No, I knew that 67 was a good thing, but
I didn't remember how it all worked.
Suze (28:53):
We, we get that because I went (Suze makes the wrong answer sound... again)
Do you see everybody now? I just want...
KT (29:00):
I'm not defending myself. I'm just trying to...
Suze (29:02):
Well, what would you call
that?
KT (29:03):
Recall.
Suze (29:04):
Uh-huh. Now, can you just imagine what our relationship is
really like? Do you think this just happens when we're
talking about Roth IRAs?
Or maybe do you think it could happen about other
things you, you think KT never
KT (29:19):
Ding ding
ding ding ding
ding ding ding. Suze got that right ding ding ding
ding
Suze (29:24):
All right, but I still love her and more importantly,
I like her.
Take us out, KT.
KT (29:32):
All right, these three things, what do they have to remember?
Suze (29:35):
People first, then money, then things. And when you're wrong,
just admit it. It's not a big deal. What are
the six greatest words in life, KT?
KT (29:47):
I admit that I was wrong.
Suze (29:49):
Ding ding ding. And if you do that, stay safe, healthy.
You will be unstoppable.
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