529 Plans vs Trump Accounts

Summary

Podcast Summary: Jill on Money with Jill Schlesinger
Episode: 529 Plans vs Trump Accounts
Release Date: July 22, 2025

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Introduction

In this enlightening episode titled "529 Plans vs Trump Accounts", Jill Schlesinger, CFP®, alongside her co-host Mark, delves into critical financial topics affecting everyday individuals. The focus centers around education savings plans, retirement strategies, and listener-submitted financial dilemmas. The episode is designed to demystify complex financial instruments and provide actionable advice without the overwhelming jargon.

Navigating Timeshare Contracts

The episode kicks off with a listener query from Regina, a retired senior citizen grappling with a burdensome timeshare contract. Regina explains:

Regina [03:06]: "I only paid $800 when I first purchased it. The maintenance fees were about $700 a year, and now they're up to around $1,500."

Jill empathizes with Regina's predicament, quoting her late mother-in-law:

Jill Schlesinger [03:45]: "Timeshares are for suckers."

Mark adds practical insights by sharing a common strategy:

Mark [03:19]: "A friend told me she just stopped paying her maintenance and never heard from the timeshare again."

However, Jill cautions against this approach due to potential legal repercussions, particularly concerning taxes tied to the maintenance fees:

Jill Schlesinger [03:50]: "I'm afraid of repercussions. Could a lien be placed on my current home if I were to do that?"

The discussion emphasizes the complexity of exiting timeshare agreements and suggests consulting directly with the timeshare company for possible solutions.

Retirement Planning and Financial Security

The conversation transitions to Jenna's scenario, a 54-year-old approaching retirement with a substantial but risky investment portfolio:

Jenna's Profile [04:43]: "They have combined IRAs about $1.3 million... Roth IRAs of $590,000, all in high-tech stocks."

Jill and Mark dissect Jenna's financial landscape, highlighting the importance of diversification and risk management. Jill advises:

Jill Schlesinger [06:35]: "Looking at that $900,000 inheritance, that's pretty solid. They are in great shape."

Mark reinforces the need for strategic planning, especially concerning Social Security:

Mark [07:07]: "I don't get why you would plan on drawing at 62."

The hosts advocate for delaying Social Security benefits to maximize financial security, especially when substantial savings are already in place.

Education Savings: 529 Plans vs Trump Accounts

A significant portion of the episode addresses Mei Mae's question regarding the suitability of 529 plans compared to the newly introduced Trump savings plans:

Mary [11:30]: "What is your opinion about a 529 versus the Trump savings plan?"

Jill provides a clear preference:

Jill Schlesinger [11:45]: "I think the 529 plan is far preferable because the other one, the Trump plan, you don't get tax-free withdrawals. It's basically like an IRA. You're going to pay the money."

She emphasizes the tax advantages inherent in 529 plans, making them a superior choice for educational savings.

Mark adds practical advice on choosing between financial products based on liquidity needs:

Mark [11:55]: "CD has a slightly higher rate but not liquid. Depending on when you need the money would be the determining factor."

This segment underscores the importance of aligning financial products with individual needs and timelines.

Listener Feedback and Encouragement

The episode also features feedback from Curtis, a 72-year-old widower, reflecting on retirement's rewarding aspects:

Curtis [12:07]: "Being financially independent, entering your golden years, it's just tremendously empowering. The freedom I currently experience reminds me of grade school letting out for the summer."

Jill and Mark respond with encouragement, reinforcing the value of financial independence and thoughtful retirement planning.

Conclusion

As the episode wraps up, Jill and Mark reiterate their commitment to providing valuable financial insights and invite listeners to engage via their website, jillonmoney.com. They encourage audience participation and promote their subscription service, Jill on Money Live, which offers additional resources like webinars and exclusive content.

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Notable Quotes

• Jill Schlesinger [03:45]: "Timeshares are for suckers."
• Mark [07:07]: "I don't get why you would plan on drawing at 62."
• Jill Schlesinger [11:45]: "I think the 529 plan is far preferable because the other one, the Trump plan, you don't get tax-free withdrawals."

Key Takeaways

• Timeshare Management: Exiting timeshare contracts requires careful consideration and professional consultation to avoid legal and financial pitfalls.

• Retirement Strategy: Diversification and strategic planning, including the timing of Social Security benefits, are crucial for a secure retirement.

• Education Savings: 529 plans offer significant tax advantages over alternative savings plans, making them a better choice for funding education.

• Financial Independence: Achieving financial independence provides empowerment and opens up opportunities to enjoy life's possibilities fully.

Final Thoughts

This episode of Jill on Money serves as a valuable resource for listeners navigating the complexities of personal finance. Through real-life scenarios and expert advice, Jill and Mark provide clarity on managing finances effectively to secure a prosperous future.

Transcript

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[Jill Schlesinger]

Welcome to the Jill on Money show. It's Tuesday, July 22nd and we are here trying to help you on your financial journey and we want to be able to give you a options and.

[Mark]

Also be a little bit of a cheerleader for you.

[Jill Schlesinger]

I mean, I feel like some of you folks are really hard on yourselves.

[Mark]

No need.

[Jill Schlesinger]

It's so much easier just to say, okay, here is where I am today.

[Mark]

Then where do I want to go?

[Jill Schlesinger]

And maybe we can figure out different routes to get there. But if you dwell on what you.

[Mark]

Did in the past, it's just a bummer.

[Jill Schlesinger]

It's just not worth it. And I don't think it really serves you well. I mean, maybe only if you've made.

[Mark]

A mistake just to learn from that mistake.

[Jill Schlesinger]

But let's not live in that place.

[Mark]

Let's try to move forward. If you've got a question, go to.

[Jill Schlesinger]

Jillonmoney.Com click the contact Us button, write.

[Mark]

Us a note, and if you'd like.

[Jill Schlesinger]

To join us on the air, check that box.

[Mark]

Mark will do everything else because he is the best. Hey, while you're on the website, why.

[Jill Schlesinger]

Don'T you check out our subscription service?

[Mark]

It's called Jill on Money Live. That is where you have access to.

[Jill Schlesinger]

Quarterly live webinars, the back catalog of.

[Mark]

Those webinars, bonus audio and video content, all 445 bucks for the next 12 months. Mark and I are working hard about thinking, what's our next webinar Guest? Who is that going to be? What is the topic going to be? We have many contenders, but if you.

[Jill Schlesinger]

Have something that you want or someone, there's a topic that you want us.

[Mark]

To cover Let us know again.

[Jill Schlesinger]

Go to Jill and money.com and click the contact us button.

[Mark]

Okay, let us do some emails.

[Jill Schlesinger]

We haven't done that in a bit and the email box gets piled up. This is from Regina, who writes, I'm.

[Mark]

A retired senior citizen who owns a.

[Jill Schlesinger]

Fixed week timeshare in Florida. I think it's also now known as a deed week timeshare.

[Mark]

I've owned it for about 15 years.

[Jill Schlesinger]

I only paid $800 when I first purchased it. The maintenance fees were about 700 bucks.

[Mark]

They're now up to around 14 to $1,500 a year.

[Jill Schlesinger]

I'd like to get out of this timeshare contract, but when I contacted one of the firms that claimed they could get you out of it, they wanted a fee of $8,000.

[Mark]

A friend told me a few years back she just stopped paying her maintenance and never heard from the timeshare again.

[Jill Schlesinger]

She also told me another friend did the same thing.

[Mark]

I'm afraid to do that because part of the maintenance fee does go for taxes.

[Jill Schlesinger]

So I'm afraid of repercussions. Could a lien be placed on my.

[Mark]

Current home if I were to do that? Any information you could provide would be greatly appreciated. Oh, gosh.

[Jill Schlesinger]

Okay. So this is one of those horrible situations which my dearly departed mother in law used to say, timeshares are for suckers. And here is the problem. It is hard to get out of them when people pass away. I know that any UNODE money is sometimes like there's a claim on the estate. I've never heard about a claim being placed on a current home. So I'm inclined to say I am not sure. So I just want to be clear about that. I would maybe talk to the place that is the timeshare company in Florida and even say, well, what happens if. And can I pay my taxes directly? Maybe that would be a possibility, but it's not a great situation. Mark, would you just stop paying? Would you try that?

[Listener]

Oh, man. The fact that the taxes are tied to this, that's what scares me. It's not. It's not in my DNA to do that.

[Jill Schlesinger]

Yeah, I agree. All right. Jenna is 54 years old and married. They have two kids, one launched, one launching soon. My husband wants to retire next summer after our second kid graduates college. My husband makes 150 grand, maxes out his HSA and Roth 401K. She is recently unemployed. She says I might do some side gigs to bring in some income for the next few years, not counting on a significant amount of income. All right, here's what they have. They've got combined IRAs about $1.3 million. Pretty good. 75, 25 when she stock bond inherited IRA which has about $150,000. It's all in stocks. Roth IRAs, five hundred and ninety grand. Oh my God, it's so risky. It's all Fang and QQQs, meaning it's all high tech stocks. And the triple Qs which is the NASDAQ 100. There's an HSA of $18,000. A brokerage account, $700,000. And it's more conservative. This one's about 15% stocks, 85% bonds. Well, that's not bad. Second brokerage, just one stock that has $190,000 worth cost basis of $6,000. Planning on doing some capital gains harvesting over the next couple years to be in a lower tax bracket. So waiting probably till he retires and then starting to sell some of the stock so that you can sell it at a low capital gains rate. Cash and cash equivalents about 20 grand.

[Mark]

Rental property 5, $550,000.

[Jill Schlesinger]

They have a mortgage on it about $175,000. It looks like they are basically cash flowing after all of their expenses.

[Mark]

$1,400 a month.

[Jill Schlesinger]

They've got a house that's worth 1,100,000 with a mortgage interest. A mortgage balance of 225 and the interest rate is 2.25%. Oh my gosh. Okay. Inheritance, future inheritance. $900,000 in about five to ten years. Parent is 80 years old, has a long term care policy. So basically it looks like that this $900,000 is pretty solid. They have term life insurance will end in 2027. They also have a long term care policy.

[Mark]

Wow.

[Jill Schlesinger]

Social Security. They say they're going to plan on drawing at 62. I don't get why you would do that.

[Mark]

I would wait till my full retirement age.

[Jill Schlesinger]

I don't know. Unless there's something you're not telling us about health. I don't know. I would really wait till your full retirement age. They're going to go on the Affordable Care act and this is so funny. Let me just read this part. How much money do you have? They've got like millions of dollars. Basically they're in great shape.

[Mark]

So this is what the one line.

[Jill Schlesinger]

That'S making me laugh. Health care from retirement to age 65.

[Mark]

We plan on getting the Affordable Care.

[Jill Schlesinger]

Act and those subsidies when we have no income. Okay, guys, come on. This seems like silly.

[Mark]

Just live your Life.

[Jill Schlesinger]

And if you qualify for the subsidies, great.

[Mark]

Don't go crazy with this.

[Jill Schlesinger]

They spend about nine grand a month and their cars are paid for. They want to leave each kid one to $2 million each. That's what I say to that. They want to spend 50 grand a year on travel, retire, blah, blah, blah. Are they okay? I mean, things look pretty good, especially with that 900 grand coming in. I don't know if you're going to spend 50 grand a year in travel. That seems like a lot, actually.

[Listener]

That's some travel. Oh, yeah.

[Jill Schlesinger]

I mean, it seems to me that, like your game plan. Okay. In general, if we're saying that you're spending nine or ten thousand. Nine grand a month, yeah, there's no problem. Everything's good.

[Mark]

Now all of a sudden, you want.

[Jill Schlesinger]

To leave each kid one to $2 million? I wouldn't even plan on that.

[Mark]

You're so young.

[Jill Schlesinger]

Like, let's get you going. If you want to spend 50, 50 grand a year on travel so that you're not. That is not $9,000 a month, obviously, I think that's harder. I think now all of a sudden, you are making my life a little bit more difficult, because now we're at nine.

[Mark]

We're not at nine.

[Jill Schlesinger]

We're at 13,000.

[Mark]

I would do this. I would run these numbers through the.

[Jill Schlesinger]

Mill, meaning you got a bunch of investments. Go to one of these websites, run the numbers, run it at ten grand a month. And I think you're mostly okay, but stop worrying about the legacy for the kids. Are you going to. You want to spend less money? Here's a question. Do you want to. What do you want to do? Travel or leave your kids one to two million dollars? Maybe you're going to have that choice. I think that you're in good shape. I don't think that you can do everything you want. Okay, this is a question from Mei Mae, who says, I'm going to be 58 this year. My husband. Husband will be 52. We have two boys ages 21 and 19, the oldest finishing college this year. $25,000 left in a 529 which take care of half of the tuition. We set aside 25,000 for his last term. Youngest has four years left with double major. Oh, boy. We have enough to cover him in his 529, except for the last year.

[Mark]

Should be partially covered by the school.

[Jill Schlesinger]

Due to an international internship. Okay. They got $3.3 million in a 401k and another 600 grand in an IRA. Neither of those have been taxed. They have a Roth of 695. 695 grand.

[Mark]

Investments of another half a million and savings at 700,000.

[Jill Schlesinger]

You gotta be kidding me. And there's an IRA budget is about eight grand a month including travel for about $1,000. But they got rift. Her husband got rift meaning reduction in force. Are they going to be okay?

[Listener]

You're going to be fine.

[Jill Schlesinger]

58 and 52. Should he. Does he have to go get another job? I don't know. I think you got a lot of money. That's just my two cents.

[Mark]

She's 58.

[Jill Schlesinger]

Is she working?

[Listener]

My guess is she is not.

[Jill Schlesinger]

So the question is really can we get this money out of. You know, because he's. She's 52. Unless she's. That's a typo and he's 62. I'm a little bit concerned about the time horizon of when he can get money and. But they had a lot of money and they don't spend a lot of money. So it seems to me like everything should be fine. Mary wants to know what is our opinion about a 529 versus the Trump savings plan. I think the 529 plan is far preferable for. Far preferable because the other one, the Trump plan, you don't get tax free withdrawals. It's basically like an ira. You're going to pay the money. You got to pay the tax that's due on the way out. So no, use a 529 instead. I got this question a lot right after the plan started. So definitely question. This is from Al. Listening to your show and I just heard you talk about a Schwab money market and a cd. Is there an advantage to one or the other? CD has a slightly higher rate but not liquid. Yeah, that's the thing. It is a slightly higher rate and it's not liquid. But it also may be that it is going to be locked in. So depending on when you need the money would might be the determining factor of which one you choose.

[Mark]

This is a last note.

[Jill Schlesinger]

This is from Curtis about our recent podcast Retirement with Intention. Which by the way I re listened to and I thought was quite good. I enjoyed your recent podcast with Christine Daniel discussing Retirement with intention. I'm a 72 year old widower enjoying just such a retirement.

[Mark]

I actively pursue my interest in music, singing and playing, guitar, travel and volunteering. I'm writing to convey to those of your listeners in their 30s through their.

[Jill Schlesinger]

60S wondering if all the scrimping and saving leading up to retirement is truly worth it. I can say with a resounding yes that it is.

[Mark]

Being financially independent, entering your golden years, it's just tremendously empowering. The freedom I currently experience reminds me.

[Jill Schlesinger]

Of the feeling I once had when.

[Mark]

Grade school let out for the summer.

[Jill Schlesinger]

Endless possibilities spread out before me like a blank slate.

[Mark]

Your listeners should focus on that blank.

[Jill Schlesinger]

Slate and how they'll fill it.

[Mark]

Kindest regards, Curtis.

[Jill Schlesinger]

Is that great, Mark? It's all gonna pay off.

[Listener]

Keep your eye on the prize.

[Jill Schlesinger]

Yeah, and yet you want me to keep working. All right, just kidding.

[Mark]

I will.

[Jill Schlesinger]

I'll keep doing it with you.

[Mark]

As long as they'll keep paying us.

[Jill Schlesinger]

That's what I'm happy to do it. Hey gang, thank you so much for.

[Mark]

All of your notes.

[Jill Schlesinger]

We really do appreciate it.

[Mark]

If you'd like to get in touch.

[Jill Schlesinger]

With us, you can find us at jill on money.com click the contact us button, write us a note. But especially if you have an episode.

[Mark]

That you like or have a comment.

[Jill Schlesinger]

On, I love that as well. If you want to join us live.

[Mark]

Check the box and Mark will do everything else. Don't forget to sign up for the free weekly newsletter.

[Jill Schlesinger]

Love that free weekly newsletter and you can subscribe to us on the Odyssey.

[Mark]

App or wherever you find your favorite podcast.

[Jill Schlesinger]

Please do something nice for someone else today. Change your work, change your wealth, change your life. Thank you for listening and we'll talk to you tomorrow.

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[Brian]

Hey there cats and kittens. It's Brian from the commercial break, the mediocre comedy podcast where my best friend Chrissy and I attempt to make sense of the world. We talk about the absurd, the ridiculous, and the stuff no one asked for, like Internet weirdos, pickup artists and why everyone is obsessed with crystals and colonics. It's all gotta stop. The show is free, it's frequent, and it's probably not for everyone. You can go to tcbpodcast.com, [e-mail] the commercial break, or check out the show wherever you listen to podcasts. We'll see you on the next commercial break and best.