Podcast Summary: Jill on Money with Jill Schlesinger

Episode: How to Manage Inherited Money
Date: November 19, 2025
Host: Jill Schlesinger, CFP®
Main Theme:
In this episode, Jill Schlesinger helps a listener named Steve and his wife navigate a sizable inheritance in the context of their overall retirement plan. The conversation covers practical and emotional aspects of inheritance management, investment choices, security, and working with financial advisors—all broken down in Jill’s no-nonsense, jargon-free style.

Episode Overview

Jill speaks with Steve from Southern California, who, along with his wife, recently inherited $500,000. Their situation involves questions about how best to integrate this inheritance into an already solid retirement plan, whether to invest in municipal bonds for tax efficiency, keep substantial cash as a financial safety net, or consider Roth conversions. The episode explores the couple's comfort with risk, the role of their financial advisor, and the importance of ensuring both spouses are confident in future financial decisions.

Key Discussion Points & Insights

1. Understanding the Financial Picture

• Steve & Wife's Retirement Baseline:

  • Ages: Steve (67), Wife (65)
  • Grown children, four grandchildren
  • Retirement assets: $1.6M in traditional IRAs/SEP, $400K in Roth IRAs, $500K recent inheritance in CDs, $100K additional cash
  • Home value: ~$1.7M, paid off
  • Long-term care insurance: $300K each

• Income Sources:

  • Social Security: $5,300/month (Steve: $3,300, Wife: $2,000)
  • Annuity: $1,300/month, fully taxable
  • Previously: Small business payout, ending this year

• Expenses:

  • Target: $9,000/month net (really ~$8,000 is spent)
  • Annual withdrawal plan: Originally to use from retirement accounts

  Jill (06:23):

  "You're pretty darn close when it comes to...what is it that you need. So you need kind of like 12 grand a month pre tax. Right. So we have to pay tax on it and then you'll get your nine grand net because you're in a high tax state."

2. Emotional Security vs. Investment Strategy

Steve admits the inherited money feels like a "security blanket", providing peace of mind as guaranteed income sources end.

• Jill recommends:
  • Keep enough cash for "two years of living expenses" (~$200K) in liquid, safe accounts (e.g., high-yield savings, or short-term CDs).
  • Invest the remainder only when comfortable, possibly after fulfilling any goals for grandchildren.

Jill (13:25):

"If you want to feel warm and fuzzy, one way to do so once you retire is to have two years of your living expenses set aside...that should be safe for you and that should make you safe."

Steve agrees:
Steve (17:24):

"Keeping it out is more. I think you have a good finger on my temperament for risk and comfort. And yeah, I like having that money aside."

3. Investment Options: Municipal Bonds, CDs, and Taxes

• Current Situation: $500K in CDs

• Advisor Suggestion: Move to municipal bond funds for potential tax efficiency

• Steve’s Concern: Prefers the safety and access of cash, hesitant to pay advisor fees on low-yield muni bonds

  Discussion:

  • Municipal bonds work well for high-tax states (like California) and high tax brackets, but decision depends on running the numbers vs. staying in CDs or taxable bonds.
  • Jill notes CD rates may fall and interest is taxable, but advises comfort and liquidity matter most.
  • Option to "front-load" grandkids’ 529 plans rather than annual contributions.

  Jill (16:36):

  "You are going to be in the 22, 24% highest bracket plus California. So your advisor is going to have to run the numbers and see whether or not owning a municipal California municipal bond fund is a better deal for you than a taxable bond fund."

4. Roth Conversions: Weighing Pros and Cons

• Advisor recommended possible Roth conversions.

• Jill’s take: Only consider if giving up some cash "security blanket" doesn't cause emotional discomfort, and only after checking the tax impact.

• Roth should be the last account tapped for retirement income; “leave the Roth alone.”

  Jill (10:01):

  "No mix. Keep that Roth. Do not touch the Roth. Okay, hyper focus on the 1.6. Okay? Leave the Roth alone...That Roth is like sacrosanct to me. It's so great. And I'd rather hold onto that for as long as possible."

5. Advisor Relationship: Comfort, Transparency, & Second Opinions

• Steve trusts his current advisor overall but is a bit hesitant about the municipal bond recommendation and paying 1% fees for low-risk products.

• Jill advises getting a second opinion from another financial professional, especially for the sake of the surviving spouse’s comfort and understanding, NOT because anything is necessarily suspect, but to confirm all choices and ensure both feel secure long-term.

  Jill (18:25):

  "...maybe this is a moment where you have somebody else take a look, see at what you have and give you a second opinion...if you feel like now is a moment just to make sure that both of you are really on board with this person, the only way you can do that is to have a meeting with somebody else…”

• Steve's wife is brought on the call to share her feelings: Steve’s Wife (20:02):

  "Steve has done such a good job our whole entire lives saving money, getting us this far. I just trust him to have a good feeling about what to do and how to do it…”

  Jill follows up: Jill (20:21):

  "But he now sounds okay, so I agree with you. I think feelings matter, especially when you have the money. And what I am interested in you considering is...is this guy, the advisor, somebody that you would feel good about [if you outlive Steve]?”

6. Key Takeaways & Memorable Moments

• Emotional comfort is as important as mathematical optimization, particularly with inherited money.
• "Security blanket" cash is a valid and often overlooked tool in retirement.
• Roth money is precious—protect it for last-resort or legacy planning.
• Be clear and proactive about advisor relationships and family buy-in.
• Don’t be afraid to seek a second financial opinion—especially when unsure about significant moves.
• “Front-load” gifts to 529s for simplicity and the power of compounding, rather than spread annual contributions unless preferred.
• Couples should both understand and feel good about the family’s financial plan, not just the more financially engaged partner.

Notable Quotes & Moments

• The importance of liquidity and comfort:
  "[The inherited money is] warm and fuzzy...Even though we had a plan, it still was unsettling. And then I...we inherited this money and it put my mind at [ease]." — Steve (13:03)

• Jill on municipal bonds vs. CDs:
  "Your advisor is going to have to run the numbers and see whether or not owning a municipal California municipal bond fund is a better deal for you than a taxable bond fund..." (16:36)

• On keeping the Roth IRA intact:
  "That Roth is like sacrosanct to me. It’s so great. And I’d rather hold onto that for as long as possible." — Jill (10:01)

• On advisors and spousal buy-in:
  "All I want to make sure is that whoever the survivor is feels comfortable." — Jill (20:21)

• Advice to the wider audience:
  "If you need some...maybe just some level setting, give us a holler...Sometimes you guys don’t even realize it, but I can hear it in your voice." – Jill (22:19)

Timestamps for Key Segments

• [03:10] Steve introduces his inheritance question
• [04:32 – 09:10] Detailed breakdown of Steve & wife's financial picture
• [13:03] Emotional reaction to inheritance, desire for security
• [16:36] Jill explains muni bonds vs. CDs, taxes, and comfort
• [18:25] Discussion of the advisor relationship; second opinion suggested
• [20:00] Steve’s wife joins to express her view on trust & future plans
• [22:19] Jill’s closing insights about listening to what’s unsaid

Overall Tone

Warm, wise, and practical. Jill balances empathy with no-nonsense advice, validating the emotional complexity of managing inherited money while offering clear, actionable steps and emphasizing the value of comfort and security.

For Listeners:

If you’re wrestling with how to handle inherited money or feeling uneasy about proposed changes from your advisor, this episode offers validation, perspective, and a reminder that your comfort—financial and emotional—should sit at the heart of your plan.