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Spouse Worried About My Retirement
Update: 2025-01-30
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I would like to retire in June, however, my spouse is very concerned about finances and lacks confidence in the numbers.
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Transcript
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00:02:17
Welcome to the Jill on Money Show.
00:02:22
It's Thursday, January 30th.
00:02:27
And hello, welcome to the program.
00:02:30
I'm so happy to be with you.
00:02:31
I am talking to we're recording this on the Monday after a huge weekend, a football holy smokes.
00:02:37
I don't care.
00:02:38
Everybody's all down like, oh, I don't want the Eagles and I don't want the Chiefs.
00:02:43
It's boring.
00:02:44
This is like peak football gang.
00:02:46
Get over it.
00:02:47
And I don't care what the stats are for Patrick Mahomes.
00:02:51
I don't care if you don't like that Travis Kelsey and Taylor Swifter of one of the plot lines.
00:02:58
The football is fantastic.
00:02:59
I mean, Mark, come on the air with me for this.
00:03:02
The first game was not great, but it was great to see that Jalen Hertz of the Eagles actually showed up to play.
00:03:09
Yeah, I mean, the score was, you would think it was a blowout, but it was close there for a while.
00:03:14
If not for those turnovers, Washington would have had a chance.
00:03:17
It's just the old story, baby.
00:03:19
Unforced errors, okay?
00:03:21
And that's the same thing with your financial life, no unforced errors.
00:03:25
Mark, I want to tell you the funniest thing.
00:03:27
So on Monday's gang, what happens is I do 18 live radio hits or little segments all across the country.
00:03:35
I mean, I only did like eight of them or I guess eight or nine of them because I always had to be on TV on CBS mornings.
00:03:43
So I'm doing my hits when I get back from doing the show and I get on the line with WCCO in Minneapolis, okay?
00:03:52
Which I love.
00:03:52
I love this station.
00:03:54
They're great.
00:03:55
And the anchor says to me, oh, we got a note from one of our listeners who has a question for you about the $10 million man.
00:04:04
Last week we aired an episode with Ed from Philadelphia.
00:04:08
Ed had like 10 million bucks and was generating 600 grand interest and dividends and people I knew were going to go berserk.
00:04:17
So Mark, tell me what the emails look like.
00:04:19
I have to say, you know, whenever we have calls like this, you expect hate mail.
00:04:24
Yeah.
00:04:24
But we did not get one piece of hate mail.
00:04:26
In fact, we got a lot of emails, like saying kudos.
00:04:29
Also on YouTube, a lot of comments on YouTube, like no, no hate mail here, man, good for this guy.
00:04:33
He did an awesome job.
00:04:35
Oh, that's so nice because this guy's like, did you think he was lying?
00:04:38
And I didn't think he was lying.
00:04:40
No, usually we could, we, I mean, first of all, like, what do you do?
00:04:43
You're gonna lie to call into a podcast.
00:04:44
Like, don't you have better things for you?
00:04:46
I would hope so.
00:04:48
But anyway, I thought that was so funny.
00:04:51
And I'm glad that we got that.
00:04:52
Okay, so we got some emails that were from you.
00:04:55
And I love this.
00:04:56
And so this is from Arthur and the subject says Ed from Philly, Mark from NYC.
00:05:02
Hello, Jill and Mark.
00:05:04
Your recent shows featuring two gentlemen who have accumulated great wealth through careful saving and investing.
00:05:11
struck a chord with me.
00:05:13
Through some self-sacrifice, I was able as a U.S.
00:05:16
Treasury employee to accumulate financial assets of six and a half million dollars.
00:05:23
How about this?
00:05:24
So instead of resenting their dedication to saving and investing, I can both identify and admire their success.
00:05:33
While I have lived above average, I was never pretentious in spending and never revealed my investing acumen to anyone.
00:05:42
But as both of your recent guests suggested, it is often difficult to spend money.
00:05:47
In fact, it's a struggle that I wish your podcast would address from time to time.
00:05:51
In my case, charities who probably will never care will benefit from my hard work.
00:05:56
Oh, first of all, charities will definitely care Arthur.
00:06:00
And we do cover this.
00:06:01
And I think that this is a topic that is weirdly particular to a bunch of our listeners, which is it's hard to stop the accumulation phase and move into decumulation phase,
00:06:14
right?
00:06:15
Spending.
00:06:16
And if you are lucky enough that you are not going to need the money, then awesome.
00:06:21
And if you need help figuring out how to actually manage that process, we'd love to hear from you truly.
00:06:28
It really does hearten me.
00:06:29
This is from Paula Anonymous, whose subject is love mail.
00:06:34
You recently had two podcast episodes where both of the listeners had higher means.
00:06:41
Thank you.
00:06:42
As one of your higher net worth listeners, I'm glad that you sprinkle these in.
00:06:47
Only thing I will say is that I wish you gave more permission to spend.
00:06:51
Dude, I already mark how much more can I tell people to spend?
00:06:54
I said that I'm like, I love the spending part of it.
00:06:56
And Paula Anonymous says, we can't take it with us.
00:07:00
Exploring what is important in your life, family, paying for an annual vacation, a charity, a donor advice fund, education scholarship fund, all of that.
00:07:10
Love your show.
00:07:11
And boy, Paula, thank you so much.
00:07:14
I love this too.
00:07:15
I really am interested in this because I also do believe that there are a lot of quiet people having these kinds of conversations among themselves.
00:07:26
Alright, let's get to some real questions.
00:07:28
So this is from Rod who says, my wife and I plan to retire in five years.
00:07:33
We have one daughter at home and she will start college in the fall of this year.
00:07:38
We have recently scaled back our retirement investing in anticipation of that college cost coming soon.
00:07:45
What would you advise for us moving forward?
00:07:48
I am 60.
00:07:49
My wife is 55.
00:07:50
Oh boy, I'm so weird.
00:07:51
Mark, I've had a bunch of people who are in this situation, slightly older parents who have kids going to college.
00:07:57
And it's a sort of a sandwich generation kind of thing, right?
00:08:00
Like you've got to really think about your own retirement or worried about your kids.
00:08:03
Some of them have aging parents.
00:08:05
So this is a very common question.
00:08:07
This will be me.
00:08:07
I will be 60 when Theo's starting college.
00:08:10
Yeah, but you feel always have an chill and that's lucky for him.
00:08:13
Okay, so Rod says estimated monthly retirement expenses $8,000.
00:08:19
Current income for both $230,000.
00:08:22
Oh, so Rod's got a pension.
00:08:24
It's either $6,600 a month or almost $6,900 per month.
00:08:30
If I defer payments six months after six months after I retire, that sounds pretty good.
00:08:35
He had this would be 100% survivor to his wife.
00:08:39
Then there's a 75% survivor to his wife.
00:08:42
They've got 401k.
00:08:44
She's got 700 grand in a 401k 100 is Roth.
00:08:47
And he's got a 457 with 105,000.
00:08:50
Okay, so they reduced their contributions.
00:08:53
wife went from 17% to 6% just to get the match.
00:08:58
And his contribution to the pension is 7%.
00:09:01
It cannot be changed.
00:09:02
He's not going to contribute to the 457.
00:09:05
They're going to have social security, which is fine.
00:09:08
It's all good, house value for 50, $80,000 mortgage at 2.7% mark.
00:09:14
And they've got only four years left on their mortgage.
00:09:17
Oh gosh.
00:09:18
This is sort of interesting because Rod and his wife have been paying $30,000 a year for private school.
00:09:25
So they're almost like acclimatized to high cost.
00:09:27
But they think they're going to pay for as much as college as they go, maybe alone for insurance if needed.
00:09:34
Okay, so how do we think they're doing?
00:09:36
They're doing great.
00:09:37
This is ridiculous because so I'm looking at the pension options.
00:09:41
He's 60, she's 55.
00:09:43
So the haircut that they would have to take to go to 100% survivor, I think is well worth it.
00:09:50
She's five years younger.
00:09:51
It's a woman.
00:09:52
She'll, you know, has a good, unless she has some health issues.
00:09:55
If you can wait that six month deferral, that seems like a smart thing to do because you get a nice bump on that.
00:10:01
The retirement accounts are great.
00:10:03
It's fine to reduce your contribution.
00:10:05
You guys are not going to spend a lot in retirement that $8,000 will be covered mostly first by the pension almost.
00:10:13
And then you wait to claim your social security at least till 67.
00:10:18
And when you both wait to claim at 67, boy, does that, it looks great.
00:10:22
So I think this looks good.
00:10:24
You think it looks good, Mark.
00:10:25
I'm kind of happy with this.
00:10:27
It looks good.
00:10:28
Great.
00:10:28
Thanks to that.
00:10:29
I had awesome pensions, 60, 60, 900 a month.
00:10:32
The mortgage is going to be done soon.
00:10:34
That's another 1500 plus their savings and their social security.
00:10:37
Yeah, I think they're good.
00:10:38
And they're like you said, they're used to paying money for school as it is.
00:10:41
Yeah, that's, see, Mark, if you just learn to, if you just send Theo to private school for high school, you'll be used to it.
00:10:47
It'll be like nothing.
00:10:48
It'll be great.
00:10:49
I doubt that's going to happen.
00:10:50
Okay.
00:10:51
Maria was listening to us talking about the Schwab solo 401k, which is like a crazy thing because if you open a solo 401k with Schwab, one of the things that they have said is like we need a physical check.
00:11:04
But Maria says, and this is like crowdsourcing advice.
00:11:08
It's great.
00:11:09
She goes, I have a solo 401k with Schwab.
00:11:11
And another way to make a deposit to the solo Roth 401k is to also have a Schwab brokerage account.
00:11:18
And she said it can only be done by calling Schwab's 800 number with a Schwab representative.
00:11:24
The customer service rep will ask for your ID brokerage account number where you would like to transfer from and the solo 401k account number to transfer to.
00:11:34
Of course, before doing this, you can easily do an online transfer to your brokerage account first to make sure you have enough cash for your solo 401k transfer.
00:11:42
I hope this helps for your listeners.
00:11:44
So basically, Mark, if you have, I mean, if you're going to do a solo 401k, you probably need to just open a brokerage account and make your life a lot easier.
00:11:53
And you still have to call an 800 number.
00:11:54
Still sounds archaic.
00:11:55
Yeah, you can't do it online.
00:11:59
All right.
00:12:00
Fred says spouse is worried about my retirement.
00:12:04
And he writes, I've been listening to your show for about two years and I enjoyed.
00:12:08
I'm 61.
00:12:09
My spouse is 60.
00:12:10
I'd like to retire in June and have a prepared financial plan that actually agrees.
00:12:15
Okay.
00:12:16
However, my spouse is concerned about finances and lacks confidence in the numbers.
00:12:21
So my spouse's anxiety, it makes me pause.
00:12:26
My spouse was forced to retire at age 56 in order to take care of her mother and aunt.
00:12:32
Now, here's the thing.
00:12:34
My salary nearly covers our current expenses.
00:12:37
We are no longer saving for retirement.
00:12:39
We have done Roth conversions for the last three years, totaling 95,000 dollars.
00:12:44
No debt.
00:12:44
They own their half a million dollar home outright.
00:12:47
They may move within five years, taking on a mortgage of 300 grand, spending 120,000 annually.
00:12:54
That's a big number.
00:12:56
So let's see what they got.
00:12:58
They've got brokerage account, 470 grand.
00:13:02
Then there is 400,000, 430,000 in this in her IRA.
00:13:10
There's an inherited 401k, 140,000 Roths, 180,000, 457 plan at 560 and HSA of 30 and a bank account with 50.
00:13:23
So this is interesting.
00:13:25
There is a financial advisor.
00:13:27
Remember that mark.
00:13:28
So just keep that here.
00:13:30
So the pension that he would be entitled to, which he puts at the very end, 45 grand.
00:13:38
His social security at his age 70, remember he's 61 is 45 grand.
00:13:45
And her social security age 62, 25,000, he says the financial advisor recommended a split strategy.
00:13:53
I don't know if I agree with that.
00:13:55
Okay, but let's just so 90, 150, you know, you know, you've got your 115.
00:14:01
Okay.
00:14:01
I mean, it looks okay.
00:14:04
But here's my question.
00:14:06
You say you're going to retire in June.
00:14:09
And I guess if you're comfortable spending money down, you should be okay, right?
00:14:15
Because the pension, the social security, you're going to spend down a lot of these assets, right?
00:14:21
So you can do it.
00:14:22
I think maybe what's happening is your wife.
00:14:26
It's, I'm going to read between the lines.
00:14:28
I wonder if you have grown children and your wife is concerned with you spending down assets.
00:14:34
But this plan really has to work by with you spending that money down.
00:14:40
So it would have to be, I would stop doing conversions.
00:14:43
Number one, if you're going to retire, then what I would do is start pulling money out of the assets that haven't been taxed to pay for your 120 grand.
00:14:52
But you're going to spend a lot of this down.
00:14:55
And that's probably what's freaking her out.
00:14:57
You know, the other thing is you mentioned about taking on a mortgage of another 300,000.
00:15:03
And I don't love that.
00:15:04
I mean, I think this is doable.
00:15:06
But she's probably right and the advisor's right.
00:15:09
It's doable.
00:15:11
And I'd be nervous if I were her.
00:15:13
So unless you hate your show, your show, unless you hate your job, maybe working a couple more years could make sense.
00:15:21
Or maybe you need to get her with somebody she can trust when the numbers are explained.
00:15:28
Do you agree with that, Mark?
00:15:29
Yeah.
00:15:30
I mean, like you said, I think it's doable.
00:15:32
But they're going to have to spend a lot of money.
00:15:35
If he retired this year, you know, until the pension kicks in, they're going to spend a lot of money.
00:15:39
Once the pension kicks in, they'll be spending a little less money.
00:15:42
But then they start to get those social security.
00:15:44
They have about $1.8 million.
00:15:46
So it's doable, but it's close.
00:15:47
It is close.
00:15:48
And I think that that's what happens.
00:15:50
And we just started the show with the people who said, you know, oh, you know, we all as a generation of of savers and type of of saver.
00:16:00
You're used to putting money away, but it can be daunting when you have to spend that down.
00:16:06
And I think that's where a lot of the anxiety comes in.
00:16:09
So if that's someone that is, you know, feeling anxious, you're not going to make that person feel better just by saying like the numbers work.
00:16:17
It may be that you have to split the difference that maybe you say, okay, you know what, babe, like how about if for the next two years, I'll work to them 62 will build this up a little bit.
00:16:27
And then maybe we could potentially think about the house, but like I think if you starting to move in five years, and that's something you really want to do that you're going to have to really think about whether or not you should be retiring now to prepare for that,
00:16:42
okay, because I don't know where rates are going to be.
00:16:44
I don't know where you're looking.
00:16:46
I don't know how much of the of the asset base you'd be willing to plow through before you got to that point.
00:16:52
This does really require a little bit more information.
00:16:55
So get back in touch with us.
00:16:57
We're happy to help you out.
00:16:58
It's just that I'm a little nervous for you.
00:17:00
Okay.
00:17:00
I don't want to be too nervous.
00:17:01
But anyway, get back in touch with us.
00:17:03
All right.
00:17:04
If you've got a financial question, go to Jill on Money.com.
00:17:06
Click the contact us button.
00:17:08
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00:17:10
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00:17:16
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00:17:19
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00:17:21
And guess what?
00:17:22
We've got our next guess.
00:17:23
I know a lot of you guessed this already.
00:17:26
Ed slot, the father of the Roth IRA.
00:17:28
He's not the father.
00:17:29
But what can we call him?
00:17:31
He is the cheerleader head cheerleader of the Roth conversion.
00:17:35
I mean, we need a title for him.
00:17:37
He is the man, the myth, the legend, Ed slot.
00:17:42
He's a CPA.
00:17:43
He is a retirement plan expert.
00:17:44
And he will be joining us for our webinar Thursday, March 6th at 7th Eastern time.
00:17:50
You must be a subscriber to Jill on Money Live to be part of that incredible.
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And I know it's going to be incredible webinar.
00:17:58
And not only that, you'll get three more after that for the next 12 months.
00:18:02
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00:18:04
We've got a lot of stuff coming back.
00:18:06
Let me tell you something, that paywall, all that stuff that's coming on to the paywall behind the paywall.
00:18:10
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00:18:12
Can't wait till we get it coming soon.
00:18:14
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00:18:19
Please lift someone up, change your work, change your wealth, change your life.
00:18:24
Thank you for listening and we'll talk to you tomorrow.
00:18:26
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