Should I Be Focusing on a Brokerage Account?

Summary

Jill on Money with Jill Schlesinger

Episode: Should I Be Focusing on a Brokerage Account?
Date: June 24, 2026
Main Guest: Tom (listener, age 37, New York)

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Episode Overview

In this episode, Jill Schlesinger takes a listener call from Tom, a financially savvy 37-year-old from New York, who seeks guidance on whether to direct more funds into retirement accounts (401k/Roth IRA) or a taxable brokerage account. Tom wants to eventually retire by age 60, if not earlier. Jill and co-host Mark evaluate Tom's situation, debate Roth vs. traditional contributions, and discuss the importance of flexibility in early retirement planning, all with their signature conversational, jargon-free approach.

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Key Discussion Points & Insights

Tom’s Financial Situation (04:12 – 06:20)

• Age 37, single, no children, NYC resident
• Income: $125,000/year
• Outstanding debt: Only a mortgage ($155,000 at 3% interest, 25 years left)
• Assets:
  • 401k: $525,000 (about 50% Roth, 50% Traditional)
  • Roth IRA: $12,000 (from a past employer)
  • Taxable brokerage (robo-advisor): $65,000 (adding $1,000/month)
  • High-yield savings: $40,000-45,000 (emergency fund)
• Annual expenses: $60,000-65,000
• Mortgage interest rate: 3%, home worth ~$250,000 (purchased for $187,000)
• No other debt and no pension

Main Question (05:14 – 05:34)

Tom asks:
"Do you think I should be investing more into IRA or Roth IRA type accounts or putting more into a taxable brokerage account? My overall goal would be to retire at 60, but if I could afford it, I'd love to retire before then." (05:16)

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Retirement Account Strategy: Roth vs. Traditional (06:27 – 09:20)

• Jill’s Guidance:
  • Tom is on great footing financially; his savings habits are strong.
  • Suggests Tom increase Roth contributions, as his current/future tax bracket is unlikely to go much lower—especially with Social Security and possible higher rates later.
  • Even though NY is a high-tax state, future withdrawals from Roth are tax-free, offering long-term flexibility.
• Mark’s View:
  • Fully supports shifting toward more Roth contributions.
  • “That’s a no brainer, a slam dunk.” (07:58)
  • Notes early retirement goals make after-tax savings very useful.

Notable Quote:

• Jill: "Isn't the goal really to say that you would like to be able to have more of that money already taxed? Because you know you'll need to get the money out and we don’t know where tax rates are going to be.” (07:06)

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Flexible Savings & Early Retirement (09:39 – 10:23)

• Brokerage Account Importance:
  • Jill and Mark agree that, in addition to maxing retirement accounts, building the taxable brokerage account is key for early retirement flexibility.
  • Funds in brokerage account are accessible before retirement age without penalty.

Notable Quote:

• Mark: “That’s gonna give him the flexibility—if early retirement is a possibility.” (09:46)
• Jill: "I think you're going to have—I don't think you're going to have to [wait until age] 60, to be honest with you." (10:10)

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Fine-Tuning the Contribution Mix (08:59 – 09:20)

• Tom is currently allocating about two-thirds of his 401k contributions to Roth and one-third to traditional.
• Jill is supportive of this split; Mark would consider an even higher Roth ratio, but both agree Tom’s fine-tuned balance works, especially given his tax bracket and current/future flexibility needs.

Notable Quotes:

• Jill: "You could sort of say like, oh, I'm gonna go to 70/30 or 80/20...but I also think putting more money into that brokerage, the robo account, I wouldn't mind to boost that a little bit." (09:20)
• Mark: "At least two thirds is Roth." (11:04)

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Estate Planning Essentials (11:28 – 11:56)

• Jill checks on Tom’s estate planning:
  • Tom has a will that leaves assets to his siblings.
  • Jill recommends he also obtain a health care proxy and durable power of attorney, reminding Tom to check if he has legal benefits through work.
• Tom mentions using LegalShield to create his will.

Notable Quotes:

• Jill: "You could do that pretty easily on your own if you wanted to.” (11:44)
• Jill: “That’s what the whole process is about.” (11:56)

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Memorable & Light-Hearted Exchanges

• Mark jokes that Tom could end up with “three kids in 10 years.” (10:38)
• Jill and Tom laugh about the unpredictability of life and reiterate the value of regular financial checkups.

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Actionable Takeaways

• For young, high-savers: Prioritize Roth contributions, but also grow a taxable brokerage account for additional flexibility—especially if early retirement is on your radar.
• Max out workplace retirement plans, split Roth and traditional if future tax situations are uncertain.
• Revisit estate documents as your life changes. Will, health care proxy, and durable power of attorney are important, even for single people.

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Key Timestamps

• [04:12] – Tom introduces his financial snapshot
• [05:14] – Main question about Roth/IRA vs taxable brokerage
• [07:06] – Jill’s rationale for Roth contributions
• [07:58] – Mark calls Roth a “no brainer” for Tom
• [09:20] – Fine-tuning allocations & boosting brokerage
• [10:10] – Early retirement is realistic
• [11:28] – Estate planning check-in

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Notable Quotes (Attribution & Timestamps)

• Jill (07:06):
  “Isn't the goal really to say that you would like to be able to have more of that money already taxed? Because you know you'll need to get the money out and we don’t know where tax rates are going to be.”

• Mark (07:58):
  “That’s a no brainer, a slam dunk.”

• Jill (09:20):
  "I also think putting more money into that brokerage, the robo account, I wouldn't mind to boost that a little bit."

• Mark (09:46):
  “That’s gonna give him the flexibility—if early retirement is a possibility.”

• Jill (10:10):
  "I think you're going to have—I don't think you're going to have to [wait until age] 60, to be honest with you."

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Summary

Jill Schlesinger and Mark confidently reassure Tom that he’s on a great financial path, balancing Roth, traditional, and brokerage accounts with discipline. Their guidance: Keep building workplace retirement savings (lean Roth as much as possible), but ensure you’re also growing a taxable brokerage account to maximize early retirement flexibility. Estate planning, even when single, is a must. The conversation highlights the power of steady, long-term saving, smart tax planning, and the importance of staying nimble as life circumstances inevitably evolve.

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For others in similar circumstances:
Prioritize a mix of Roth and brokerage savings to maximize post-tax flexibility, and keep your long-term plan updated as your life and goals change.

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For more listener Q&A or to submit your financial question, visit jillonmoney.com.

Transcript

[A]

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[B]

Good morning, how are you?

[A]

Great. What can we do for you?

[C]

So I had a.

[B]

Probably a more in depth question for you. So I'm 37, not married, I don't have any kids. I live in New York. I make around 125,000 a year. The only debt I carry is my mortgage, which has about 155,000 remaining at about 3% with, give or take, 25 years left. Don't have any debt beyond my mortgage, which I'm proud of. In my 401ks through work, I have about 525,000 saved. It's probably 50, 50 on Roth versus traditional 401k. And I contribute about 18 before the 4% company match. So 22% all in.

[A]

Nice.

[B]

I have, aside from that, I have about 12k in a Roth IRA. And then beyond that, I have about 65 in a taxable brokerage, which is just a regular robo advisor. I Contribute to that weekly and then I have probably 40 or 45 in a high yield savings account as like a emergency reserve spending money, that type of thing.

[A]

Great.

[B]

I think I spend probably around 60, 65,000 a year. So I'm definitely able to live within my means. My overall question for you is, do you think I should be investing more into IRA or Roth IRA type accounts or putting more into a taxable brokerage account? My overall goal would be to retire at 60, but if I could afford it, I'd love to retire before then.

[A]

Yeah, who, who wouldn't? I mean, here's the thing. Who, who says I want to work till I'm 90? I at least want to have the opportunity, right? No problem. Okay, so you spend. So right now you spend 60 or 65 grand a year. You make 1 25, you're putting 18% into your retirement account, plus you're adding money to your. Are you adding money to the Roth or the Robo right now or not?

[B]

I add to the taxable brokerage account, I add about $250 weekly and then I save a little into the savings account, checking account and things like that.

[A]

So 18% on your 125 plus you save at thousand bucks a month or so. Maybe a little more. It's amazing. That's great. How much is your house worth, by the way?

[B]

It's worth. If I sold it today, it'd probably be a little over 250 and I bought it for about 187.

[A]

But you want to stay where you are for now?

[B]

Yeah, I mean, I mean, I'm locked in at the 3% interest rate, so I'd love to be able to ride that out as long as I can.

[A]

So here's the thing, Tom. I think you're in great shape. I think you're in really good shape. If you are saying, should you be in Roth versus Traditional? I think that the answer is probably you really should be more in Roth. It's not because, you know you. It's. I know you live in a high tax state. So let me start by saying that I understand people who live in New York and California. They're like, wait, it's terrible, it's terrible. But I mean, you know, you're in the most of your income is being taxed at 22, nudging into your 24% bracket. But when you think about yourself, Tom, and you look ahead and you say 23 years from now, when I'm ready to retire, I will have already saved a bunch of money in traditional Assets. And isn't the goal really to say that you would like to be able to have more of that money already taxed? Because you know you'll need to get the money out and we don't know where tax rates are going to be. But it's unlikely to me that you're going to be much below the 22% bracket in the future. I just don't see it. And you know, you'll have Social Security. You don't have a pension, do you? You didn't mention it.

[B]

No, I do not.

[A]

So I'm just going to ask Mark. Mark, right now, Tom is sort of half and half, 401k being Roth and traditional, how would you feel if he kind of started nudging more towards the Roth? Let me answer that for you. You're all in favor of this, right?

[C]

That's a no brainer, a slam dunk. But he's also, you know, with potential early retirement, should it be putting more into, you know, the retirement accounts like the Roth IRA or the brokerage account? I mean, if he really thinks that's a goal, honestly, I think, I think it is attainable given what he has, what he saves and what he spends.

[A]

Yeah. Okay, so let's pretend that we get you. You know, you're, you're so young. It's, you turn 50 and you're looking at all of these accounts and you're like, this is great. And markets have been good to me and I've saved even more and I've gotten some raises along the way. Now maybe 53 is possible or 57 is possible. In that scenario, we would want to make it possible for you to retire even earlier. So if you're looking at your contribution of 18% into your retirement account, is that all? Is it being split between traditional and Roth right now or is it weighted one or the other?

[B]

Yeah, so I do about two thirds of it into Roth and then just save me a little on taxes. At the end of the year, I do about a third of it in traditional, but then I still get the 4% on top of that. And for the past probably two, maybe three years, I've been able to max out the contributions to the federal limit of, you know, 22, 23, whatever, whatever it's been over the past couple of years.

[A]

That doesn't bother me. I mean, you could sort of say like, oh, I'm going to go to 70, 30 and 80, 20 and kind of. But I, I also think putting more, more money into that brokerage, the robo account, I wouldn't mind to boost that a little bit even instead of the. Are you putting money actively into that Roth ira, or is that just.

[B]

It's from an old employer.

[A]

That's what I figured.

[B]

Yeah.

[A]

So I think I would try to do that. Mark, do you agree, like, just putting a little more money in the. In the brokerage?

[C]

Yeah. I mean, that's going to give them the flexibility. If early retirement is a possibility, what do you have left over? I'm assuming you have money left over at the end of each month because you don't spend a lot of time.

[A]

But he's got 1,000 bucks a month going into the robo right now, right?

[B]

Correct. Yeah. And then I save a little into, obviously, like, checking, savings, things like that. And then, you know, I try not to live beyond my means. It might just be like, oh, I'm going out to eat a little more, or things like that.

[A]

But you're entitled.

[C]

I mean, I think that's the right strategy. You know, keep doing your workplace plan. But, yes, stick. Stick with the taxable brokerage account. Don't worry about the Roth ira. Okay. I think you're going to have. I don't think you're going to have to go to 60, to be honest with you.

[A]

We'll see.

[C]

I mean, we got a long time. Obviously, we'll see.

[A]

It's a long way, but I agree. I think that. And also, listen, I know that, like, we know what you make now, we know what you spend right now, but things can change, and I'd like a little. I think it would be nice to have the flexibility to be able to do one or the other.

[C]

He could have three kids in 10 years, right?

[A]

Oh, my God. Could you. Tom, are you gonna have three kids in 10 years? That would take a lot of work right now.

[B]

I mean, maybe we'll see what the future holds, but.

[A]

Well, that's it. That's it. So I think that just a little bit of flexibility. I like the game plan right now. I'm not even sure I would change from two thirds Roth to one third traditional. I know, Mark, you would disagree, but I don't know. I feel like it's.

[C]

At least two thirds is Roth.

[A]

Well, that is right now, right?

[C]

That's what I said. At least two thirds is Roth. Yeah.

[A]

So I think that it's good. It's a great game plan. I think you're on track. I really do. And it's exciting, isn't it? It's, like, kind of fun. You can be, like, so young and Be like, holy smokes, I'm doing it. You are doing it, man. Which is great. Now a couple of other questions. I know you're single, but do you have estate documents because you have assets?

[B]

I have a will put together. It would all go to my brother and sister if I were to pass away, but I do have a will put together, yes.

[A]

Okay, good. And a health care proxy also, just in case, like you get into an accident or something. Somebody has to make a healthcare decision for you.

[B]

So I'd have to check on that.

[A]

You could do that pretty easily on your own if you wanted to. Do you have a benefit through work? That's estate stuff. Like sometimes there are legal benefits.

[B]

I have a legal. The legal shield, through which I think that's where I did the will through a couple of years ago.

[A]

So that I think I would just add a health care proxy and something called a durable power of attorney. And it's just like if something happened to you, someone could act as your agent. If you could not, that's really. That's what the whole process is about. Tom, I think you're in great shape and we look forward to hearing more about your three children, which Mark's putting. That's put Mark. Start. Start the marking right now. Just say like, okay, we're talking to him at this day. Three years from now, we'll get back in touch with you. Give us a holler if things change. Because you know what? Things do change. So if you're like Tom and you're in your 30s and you're rocking and rolling and you want to know what to do, guess what? We can help you out. All you need to do is go to the website jillonmoney.com, click the contact us button, write us a note and check the box. If you're willing to come on the air, don't forget, all of our content lives out on that website. And 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, lift someone up. Change your work, change your wealth, change your life. Thank you for listening and we'll talk to you tomorrow.

[C]

Nerds.

[D]

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