Podcast Summary: "Anxious About Retirement Plan"
Jill on Money with Jill Schlesinger
Release Date: April 16, 2025

Introduction

In the April 16th episode of Jill on Money with Jill Schlesinger, host Jill Schlesinger and her co-host Mark, both Certified Financial Planners (CFPs®), delve into the often nerve-wracking topic of retirement planning. This episode, titled "Anxious About Retirement Plan," centers around a listener call from Laverne and Shirley, a couple from upstate New York grappling with uncertainties as they approach their planned retirement.

Caller Profile: Laverne and Shirley

Laverne and Shirley, both 61 years old, have meticulously planned for their retirement, aiming to retire in September of the same year. Their house, valued at approximately $400,000, is nearly paid off with just $6,000 remaining on their 3% mortgage. Despite their financial preparedness, recent market fluctuations over the past two weeks have ignited anxiety about their retirement plans.

Jill Schlesinger (04:00) introduces the callers warmly:

“Welcome to the Jill on Money show. It is Laverne and Shirley from upstate New York.”

Financial Overview

Jill begins by assessing the couple's financial standing, uncovering a robust portfolio designed to support their retirement.

Retirement Accounts:

• Laverne's 401(k): $752,000 (Traditional)
• Tax-Deferred Annuity: $95,000, providing $1,230 monthly for life
• Roth IRA: $10,000
• Certificates of Deposit (CDs): $25,000
• TIAA Intelligent Variable Annuity: Started at $100,000, now $212,000
• Inherited IRA: $16,000 with Required Minimum Distributions (RMDs) of $600 to $800 annually
• Shirley's Rolled-Over 401(k) into TIAA IRA: $294,000

Managed Portfolios:

• Bonds-Focused Portfolio: $988,000
• Equity-Mixed Portfolio: $961,000

Cash Holdings:

• Total Cash: $380,000
  • CDs: $100,000
  • Reserved for Renovations: $200,000
  • Checking Accounts: $30,000

Health Care:

• Shirley's RIPA Account: $130,000 earmarked solely for insurance premiums until Medicare eligibility

Monthly Expenses:
Approximately $8,500, including $1,000 allocated for travel, bringing actual living expenses to about $7,500.

Social Security Benefits:

• Laverne:
  • At 67: $3,124
  • At 70: $3,900
• Shirley:
  • At 67: $2,880
  • At 70: $3,574

Jill Schlesinger (06:03) acknowledges their substantial savings:

“That's a lot of moolah. You guys have done great.”

Concerns: Market Volatility and Retirement Timing

The primary source of anxiety for Laverne and Shirley stems from recent market downturns, which have shaken their confidence in retiring as planned. They fear that a potential further 20% drop in the market could significantly impact their financial stability.

Laverne (04:42) expresses their dilemma:

“But the last two weeks has made us really nervous and anxious, and now we're not sure what we should be doing.”

Expert Advice: Mitigating Retirement Risks

Jill and Mark provide strategic insights to help alleviate the couple's concerns, emphasizing their strong financial foundation.

Strategies Discussed:

1. Gradual Withdrawal Strategy:

   • Instead of withdrawing all funds at once, they suggest tapping into specific accounts first, such as the traditional TIAA IRA and the tax-deferred annuity. This approach preserves the bulk of their portfolio, allowing continued growth even if the market declines.

2. Annuitization:

   • Jill proposes annuitizing the traditional TIAA 401(k) to receive equal payments over a set period, thereby reducing the need to withdraw large sums during market lows.
   • Jill Schlesinger (15:37) recommends:

     “Maybe a way around that is to lock down the fact that you can cover your fixed expenses and not worry if the market were to tumble another 20% from here.”

3. Maintaining a Balanced Portfolio:

   • With an asset allocation of roughly 60% bonds and 40% equities, their portfolio is diversified to withstand market volatility. Bonds, having already performed well, provide a buffer against equity downturns.

4. Utilizing Existing Annuity Products:

   • Since they already hold multiple annuity products through TIAA, leveraging these can provide steady income without the need to liquidate investments during unfavorable market conditions.

Mark (10:29) reassures them of their financial health:

“They may be concerned over the, you know, because of the last couple of weeks or so, but I'm not very concerned.”

Jill Schlesinger (14:52) adds:

“If you're anxious, it may be worth it because you're already in this product and you already own the tax deferred annuity.”

Reassurances and Final Thoughts

The hosts emphasize that Laverne and Shirley are well-prepared for retirement, highlighting their diversified investments, substantial cash reserves, and comprehensive health care plans. They encourage the couple to consult with their financial advisor to tailor the withdrawal strategy that best fits their comfort level amidst market uncertainties.

Shirley (17:17) shares her relief:

“I just gotta say, this really puts our minds at ease, Jill.”

Jill Schlesinger (17:35) concludes with optimism:

“You are very fortunate that you had family that left you these, you know, big pile of assets. Let's take advantage of it. You never know what happens next, so enjoy it.”

Conclusion

This episode of Jill on Money serves as a valuable guide for retirees or those approaching retirement who may experience anxiety due to market fluctuations. Through a detailed analysis of Laverne and Shirley's financial situation, Jill and Mark demonstrate how comprehensive planning, diversified investments, and strategic withdrawal strategies can provide peace of mind and financial security in retirement.

For listeners with similar questions or concerns about retirement planning, career changes, or navigating economic uncertainties, Jill Schlesinger invites you to reach out via jillonmoney.com and engage with the show’s resources for personalized advice.

Notable Quotes with Timestamps:

• Jill Schlesinger (04:27):

  “Well, my wife and I, we'd been planning on retiring in September of this year when our house is going to be paid off and we'll both be 61. But the last two weeks has made us really nervous and anxious, and now we're not sure what we should be doing.”

• Mark (10:29):

  “They may be concerned over the, you know, because of the last couple of weeks or so, but I'm not very concerned.”

• Jill Schlesinger (15:37):

  “Maybe a way around that is to lock down the fact that you can cover your fixed expenses and not worry if the market were to tumble another 20% from here.”

• Shirley (17:17):

  “I just gotta say, this really puts our minds at ease, Jill.”

Resources Mentioned:

• Jill on Money Website: jillonmoney.com
• American Express Business Platinum Card: americanexpress.com
• Leukemia and Lymphoma Society – Student Visionaries: lls.org