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- [00:00]
Robert Half
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- [00:34]
Jill Schlesinger
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- [01:30]
Welcome to the Jill on Money Show. It's Thursday, April 17th and we are here answering financial questions for you. If you have one, go to our website jillonmoney.com in the upper right hand corner, clear as day, you can see a Contact Us button. When you click that button, a form pops up. That is the email that we will receive once you complete it. If you would like to join us on the air live, all you need to do is check the box and Mark will do everything else because why? Because. Say it with me, gang. He's the best executive producer in the whole wide world. Yes, he is. While you're on the website, don't forget to check out all of our content that lives there, including our free weekly newsletter as well as the blog section and videos. I've been doing a lot of videoing. Well, I've been just on the air. This whole tariff thing is driving everybody crazy. I know, but. And you're probably sick of tariffs. It's like tariff talk. I'm done. But you know, here we are. Let's do some emails. Mark and I need some help because my throat still hurts. This is from Marcia, who writes subject Tanking Economy. Oh boy, that's already getting off on a grim foot. We're 75 and 80 years old and we are already retired and we don't have time for the market to recover. We're scared to death and keep telling our senators that. What's going to happen to us? All right, Marcia. I wonder if Marcia is invested or not. I mean, the economy's not yet tanking. It's kind of weird because all of this feels like it could go be bad, but it may not be bad. So, Marcia, what I would try to do is focus on where is your money coming from? Are you getting Social Security? Do you have money in the bank? Is that paying for your needs? And if that's the case, everything else in the background is noise. If you have investments, is it a small percentage of your total that's invested? If so, maybe you can kind of drown out a lot of the drama and let things be. If you have specific worries because, you know, maybe your money is allocated in too risky a fashion, get back in touch with us. Mark and I are going to hold your hand and we'll figure out how to make this better for you. Okay, now this is a good question. I've been getting this. This is from Natalie. Is now a good time to increase my Roth conversions? Okay. Natalie writes, I'm thinking about what to do in this economic downturn. I'm wondering whether stepping up Roth conversions time wise and dollar amount might be a smart move this way. If or when? Well, say when the market finally rebounds, the growth would be tax free. I love this idea so much, Natalie. So Natalie says, for the past few years, I've converted to the top of the 12% married filing jointly bracket, and it's been about 60 grand. I'm wondering whether I should do more this year while the market is low. And additionally, we normally wait until the end of the year to get a more precise number, but I'm wondering whether we should aim to make a first pass at a conversion earlier in the year while the market is low. Optimistic. Me assuming it will eventually rebound. So, Mark, should Natalie try to take advantage of the crummy circumstances?
- [04:39]
Mark
Yeah, I mean, why not? This is one of the things that we spoke about recently. You know, times like this, there's usually some opportunities and this is one of them.
- [04:46]
Jill Schlesinger
Oh, yes, And I love this idea. And I love the idea that people are trying to be opportunistic. So this is a great way to potentially supercharge those Roth conversions. Of course, make sure you've got the money to pay for it outside of retirement. I know you know that, but I'm just saying it just in case Brian says hello. I just started to listen to your show. I'm 65 years old and retired. I've got $550,000 in my 401k. I receive $3,000 a month in Social Security and pension. My house is paid off as are my cars. I'm single, I've got no debt. I've gone through a bunch of slowdowns and downturns in the market. But this time I'm really worried what I should do with my money. Should I ride it out? I know it's the million dollar question. I need to hear from an expert. I would appreciate any help. Okay, Brian, this is just like the email we just tackled in that when you have money that is invested like this $550,000, I want you to think about how it's invested because sometimes people don't even look at the account. They're just looking at the headlines and they freak out. So I want to know how is the money invested? Is the money all in stocks, all in bonds? A little bit of this, a little bit of that. So we need to know what the allocation is. Second thing, good thing to remember, you're not really, it doesn't sound like you're really touching this 401k right now. You've got time, you've got another 10 years before the government's going to force you to start taking money out of your 401k. And so in some respects you got that. The first time that you're going to force to withdraw would be when you reach your required minimum distribution age of 75. But even that you are investing for decades. In the future you could live another 30 years. So hopefully you have an allocation that can see you through all of those ups and downs. Again, gang, if you're really worried, I want you to come on the air with us so we can hold your hands directly. You know, I think that would be helpful for everybody. Okay. This is from letter N. N says okay, the year end 2024 401k balance was up so much that my 2025 required minimum distribution is the highest it's ever been. This is a wild question mark, you know that I, I really forgot about this. This is a very unique circumstance. But it happens from time to time. Like, but it is unique where your balance is really high at the end of 24, which means every required minimum distribution is based on your December 31st balance. And so that's how the government figures it out based on your life expectancy. Okay, what happens if my 401k balance, which is tied to stocks, drops by so much by the time my RMD is paid that there's not enough money left to meet the 401k RMD amount? I usually take my RMD in December. Should I take it now before it's wiped out by the market? What does he mean by that, Mark?
- [07:54]
Mark
There's no way. There's no way. I mean, I don't know any of the balances, but if this account was at an all time high and I can't imagine it's going to zero, it's.
- [08:01]
Jill Schlesinger
Not going to go to zero. I still think you should try to stick to your game plan of taking the rmd. Unless you say I am going to pull out my. I mean, I would wait till December, but unless you're like, hey, maybe I'll convert some of it, then that might be good, but that doesn't satisfy your rmd. Anyway, I don't think I would alter my game plan based on this. We don't know. It's like a long time before the end of the year, right? I don't think it makes sense. Okay, this next email is from Cindy, who writes, I'm 73 years old and I've got a small IRA account at Vanguard which lost a lot of money this week. It went from 108,000 to 100,000. Should I withdraw the money and close out my account and put the money in cash in my safe on. Oh, my goodness, you mean cash. Cash. I've got a $95,000 mortgage with $250,000 in equity, less than $1,000 in credit card debt. I owe 20 grand on a car. I had to purchase one. I could pay off my mortgage, but then I'd have nothing in reserve. I could pay off the car. I get two grand in Social Security. I work part time, but that work is dwindling now due to cutbacks and I'm scared. I'm really, really scared. Okay, that's what I'm going to do with you, Cindy. So hear that? I don't want you to pull all your money out, but I sure don't want you to have all of your money in stocks right now. So you're 73. One thing I would do immediately is take a couple grand out of this account, pay the tax that's due on that and get rid of that credit card debt. I would not pay down your car loan. I would not pay down the mortgage. I would keep that money in the account. But Cindy, you Can't afford losses. You can't have too much risk in there. So if you're really worried, don't pull the money out. It would all get taxed at once. You could move some of the money to a fixed account or a short term bond fund and even a money market, but you only want to keep a small percentage. If this is your only money, follow up with us. I'm concerned that you're going to pull that money out and then bam, you are going to really get whacked with a tax hit. And no, you should not put your money in cash in a safe. This is from Roberta. What a nice last message for everybody who writes subject. Thanks. Thank you both for your calm and steady responses to the recent disruptions in the markets. Hey Mark, good place to end.
- [10:27]
Mark
I try. I try to end on a positive.
- [10:29]
Jill Schlesinger
It's a good note. Thank you so much. Hey gang, you know what? These are scary times. I understand. It's so hard. It's mostly because things are changing so quickly. So if you've got a question, if you're worried, you can write us a note. But do come on the air. We'll change your name. We'll do whatever we can. We'll anonymize you. No one can see you. We would love to be able to talk more with you and walk you through what's going on for you. Nobody else but you. Okay, so get in touch with us. Go to jillonmoney.com, click the contact us button, write us that note. Come on the air. Come on. It's a lot of fun. And while you're on the website, you can subscribe to our Jill on Money Live service where you have access to quarterly live webinars, bonus audio and video content, and the entire back catalog, all for a bargain basement price of 45 bucks. For the next 12 months, you can subscribe to us on the Odyssey app or wherever you find your favorite podcast. Please leave us a rating and review wherever you listen. And of course drop to do something nice for someone else today. People are scared out there, so let's calm each other down. We're a community. This will work when we pull it all together. Okay, gang. Change your work, change your wealth, change your life. Thank you for listening. We'll talk to you tomorrow.
- [11:45]
Robert Half
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- [12:38]
Alex Asulin
Alex Asulin and I'm inviting you to listen to Asurin's official podcast, Culture Lounge. For the last 30 years, Asurin has created books at the center of culture and luxury, covering everything from wine and watches to fashion, travel, and Formula One. Now we're inviting you into our world through a new and exciting medium. Join me on Culture Lounge, where you will hear intimate conversations with icons like Aaron Lauder, Linda Fargo, Mario Carbone, curators from Sotheby's, and the world's best sommelier, all gathered like old friends at a beautiful bar, discussing their deepest passions, sharing stories, and giving us their best advice. It's like eavesdropping on the most interesting conversation you could ever imagine. Culture Lounge is available wherever you get your podcast. Tune in now to be inspired and learn something new.