Mark (7:31)

And let me just say, like it only applies to your current employer plan. Even if you're still working, if you have an old IRA or an old 401k from an old employer, you, you do have to take the RMDs from those accounts, right?

Jill (7:43)

And this is interesting because a friend of mine, what happened was she was had an old retirement plan that she had rolled into an IRA, then got a job in like when she was 72. And what she did was she took the old plan, rolled it into the current plan and then avoided. She. So she took distributions for a year and then stopped while she was working in that new organization for two years. It's kind of cool. But Mark is right. You have to be, it has to be the plan plan that is actually active, the one that you are actually in is the one that you really need to be paying attention to. And if you've got old plans that really does argue to get as much money into the current plan, roll it in, see if they'll take money from other sources, other pre tax retirement sources. Okay, this is from Anonymous and says Anonymous needs help with my mom. Okay, here's the deal, Mark and Jill. I need help with my mother's financial situation. She is 82 years old. She lives alone. She's in good shape. She's still very active. She has $235,000 in an IRA, $250,000 in a brokerage account, and about $7,000 in checking. Her income is about $1,150 from her required minimum distribution. Okay, $1,600 from Social Security and then $1,000 with a pension that has a cola. So that's kind of cool because at least 2,600 is, you know, going to be inflation adjusted. So there's the income that she has, which is 3750. She doesn't own her home, but so we have income of 3750 and it's all taxable, everybody. Her monthly spend is about $5,000 to $5,500. She is drawing from her brokerage account to meet her monthly needs. I am fearing that she will run out of money in seven to eight years. Okay. I hear nothing but bad things about annuities. But if the online calculators are correct, I've tried a few. If she used $200,000 of her Iraq to buy a single life annuity, it would pay out $2,000 a month for life. That would decrease the burden on her brokerage draw and be there for her life. The only other note would be if her ex husband, who is in good health at 84, passes before she does, she would get a bump in the pension to $2,000. But I'm not counting on that. What are your thoughts? Does an annuity make sense? Mark, do you think maybe an annuity could make sense in this case? I don't see how $2,000 for life, but maybe you beat the odds because you're 82 years old.

Mark (10:32)

I mean, I would certainly look into it because right now there's, you know, there's a shortfall. So she probably is going to run out of money.

Jill (10:37)

So I think what you should do in this situation is talk to a fee only advisor and maybe you're going to have to pay for this, but you're going to have to talk to somebody who doesn't get paid by an insurance company to look at this annuity scenario for your mom. And I think that that's going to be the key here, that the person who recommends an annuity cannot be the person who is getting paid by the annuity company. It would be better if you just paid someone, you know, a thousand bucks, two thousand, whatever it is, just to look at this and to see what the opportunities are. I mean, she is 82 and she's in good shape. It would be wonderful if we could get that single life annuity. And I presume that, that it's an immediate annuity. I don't think that it would be a, you wouldn't defer it. So it would, you know, you'd take money, 200 grand from the IRA, you'd pop it into the annuity. The annuity starts, you know, sending out the two grand a month. And I would like to preserve that brokerage account as well. So I again, fee only advisor to help with this decision. Okay. Eileen writes that she bought her condo 15 years ago. The mortgage rate then 3.125%. She paid $325,000 for the condo. She's got $179,000 balance. However, the mortgage rate was a 10 year ARM. The adjustable part of the mortgage will kick in in the beginning of 2027. Okay. A lot of people have these kinds of loans. One of them is on the microphone on the other end there. I would like to refinance the mortgage for a fixed rate and I'd also like to take cash out to pay off a home equity line of credit that has a balance of approximately $39,000. Question, should I refinance now or wait another year closer to the end of the fixed rate part of the mortgage to see what the rates will be like. I know that I won't see 3.125% again in my life, but I don't know how to tell when the right time is to take the plunge. Mark, as someone who has a 10 year adjustable rate mortgage, can you give Eileen some guidance on this?

Mark (12:54)

Well, thankfully I've got nine more years to go. I mean this is a complete roll of the dice. But I'm inclined to wait.

Jill (13:00)

Me too.

Jill (13:00)

I would certainly wait till the beginning of next year. And I think that you, you know, we might see. We are seeing mortgage rates as we speak right now. We're seeing mortgage rates heads towards six. If you run the numbers of a fixed rate note, what I would see is like where is the level at which you can really afford it? And if it's five and a half percent, then jump on that. Like just run those numbers right now so you feel comfortable. I think that we will get below six. I don't know if we're going to get to five, but I could see us being at five and a half, five and three quarters next year. And if you can make that work, then pull the trigger and do it. Okay. Kathy says that she's 70, the husband's 67. They live in Buffalo. Wasn't that lucky for them? They've got a great football team. Anyway, she says we've been looking for a next stage of life house. We found one in our area. We signed a contract for $539,000. Okay. We have to sell our current house and pay off our $80,000 mortgage. The realtor thinks we can get about a half a million dollars for it after closing costs and paying off the mortgage. We need a mortgage of $160,000 on a new house. Boy, this is mortgage episode, right? So 30 year rate, 5.85%. That's good. That's cheaper than what I've seen. 15 years, 5%. I'm agonizing over 15 versus 30. My husband said go with 30, we'll never see the end of the mortgage. It doesn't matter. Your thoughts, other concern. Let me just do the thoughts on this. Get a 30. Get a 30. Drive down your payment as low as possible. That's what you want to do. If you want to, you know, if everything is going great and you want to pay it off sooner, fine. But I'd go for the 30. I'm with your husband. Here's the other concern. If this house does not sell and Close by the beginning of December. We need to come up with 200 grand at closing. Ay yai yai. Okay. She's got a thrift savings plan of 580. Husband has got a $280,000 retirement account, taxable Schwab account of 210 with a bunch of stocks that she inherited in 2012. So there's got to be a huge tax liability there. They've got a few other accounts. Main question is, if I need. If I need house closing account money prior to closing, should I take a withdrawal from the thrift savings plan and try to reimburse within 60 days? Does that make sense? So they have pensions. So what do you think, Mark? Do you want to try to, you know, withdraw from the thrift savings plan? And so I'm anxious over these decisions.

Mark (15:39)

I hate time in these real estate transactions.

Jill (15:41)

I know.

Mark (15:41)

Never really works.

Jill (15:42)

I know what I'm really worried. I guess what I'm back. Let me go back in time. You found a house in your area. You signed the contract. That's the done deal. Okay. So the most important thing that I would say is you tell your realtor we want to price our house to sell. And that is something I would really be paying attention to. You cannot afford to wait till the last second. I would rather you make less money on your existing house than go through these guessing games of which is the best money to tap. Your downside of taking the money out of the thrift savings plan is you'll have a distribution, but you have to get the money out of there anyway. So I guess that, you know, it's not the worst thing in the world. I think I'd rather try the distribution than start paying tax on all these stocks. I. Kathy, if you're listening right this second, I just want you to take a deep breath. 30 year note. Don't go for the last dollar on the house. Tell the realtor we want to price this to sell. If they. If you can get half a million for it and you get a bid for 470, I might be like very quick to hit that bid. That is an important aspect of this transaction that you get out of this house as quickly as you can. Getting as much money as you can, but not waiting for dear life. Okay. I hope that helps. Mark. This has been quite the week of mortgages and questions and required minimum. We have such a great, great, smart audience. It's incredible. If you've got a question, maybe you are not at your 60 or 70, but you're just starting your financial journey. We'd love to hear from you too. We like to have diversity and types of people that we talk to. Get in touch with us. Go to jillonmoney.com click the contact us button, write us a note, and of course, let us know if you'd like to come on the air live with us. If you would, check the box. Mark does everything else. You can subscribe to us on the Odysee app or wherever you find your favorite podcast. Please leave us a rating and review wherever you listen and do something nice for someone else today. Change your work, change your wealth, change your life. Thanks for listening. We'll talk to you tomorrow.

Jill (18:05)

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Nancy Cartwright (19:10)

Hi, I'm Nancy Cartwright. You may know me better as the voice of Bart Simpson on Simpsons Declassified, we're diving into the mysteries that keep the Simpsons forever young. Have you ever wondered how the Simpsons regularly predicts future events? Who better to ask than the show's creators, performers and writers, the celebrity guests? Be sure to follow and listen to Simpsons Declassified wherever you get your podcasts.