Podcast Summary: Should I Be Making Financial Tweaks?

Podcast: Jill on Money with Jill Schlesinger
Date: December 31, 2025
Host: Jill Schlesinger, CFP®
Episode Theme: Reviewing & Tweaking Your Financial Plan for the New Year

Episode Overview

In this listener-centered episode, Jill Schlesinger invites Mary from Connecticut to discuss her financial situation and whether any tweaks are needed as the year wraps up. The conversation focuses on Roth vs. traditional contributions, retirement savings strategy, investments, and estate planning. True to Jill’s style, the discussion is jargon-free, supportive, and actionable, aiming to reassure listeners and offer easily implementable advice for those in similar financial positions.

Key Discussion Points & Insights

1. Mary’s Financial Snapshot

[03:13]–[06:46]

• Background:
  • 64 years old, divorced, not partnered, three grown children.
  • Working, making $99,000/year, plans to work until at least 70.
  • Comfortable with continuing to work:
    • “I think I'd be bored if I didn't do it... I'm in the prime of my career now.” — Mary [03:50]
• Retirement & Savings:
  • Maxes out 401(k) (traditional only so far), balance at $280,000.
  • Additional savings: $60,000 in online savings, $51,000 in HSA (untouched, invested), $10,000 company stock (brokerage), $768,000 traditional IRA (from old employment/divorce, lump sum pension), small Roth IRA ($20k), $25,000 general brokerage account.
• Expenses: Approximately $70,000/year.

2. Pensions, Social Security & Income Streams

[06:03]–[07:16]

• Two small pensions:
  • $400+/month (starts at 65), $500/month (from current employer, after retirement).
• Social Security benefit of $3,550/month at 70.
• Alimony: $28,000/year, ends when ex-husband retires.
• Combined, pensions & Social Security expected to be ~$4,400/month, covering a significant portion of post-tax needs.

3. Should Mary Add Roth Contributions?

[07:46]–[10:05]

• Jill recommends shifting some retirement contributions from traditional to Roth moving forward:
  • “Of course you should have the Roth. That's an easy one because you already have now, you know, a million bucks that hasn't been taxed. And when you're forced to take that money out, it's going to be like real money.” — Jill [08:06]
• Reasoning:
  • Large pre-tax balances could force significant taxable withdrawals later.
  • Roth contributions can diversify future tax exposure.
• Recommended Experiment:
  • Consider putting 10% into Roth 401(k); direct incremental cash flow into the brokerage account for added flexibility.
  • “If in five or six years that brokerage account was more like $100 or $150 [thousand], I think that's a better way to go into your retirement years.” — Jill [09:35]
• On the higher taxes now:
  • Jill acknowledges potential for higher annual tax burden:
    • “You're going to have to pay more taxes, right?... Maybe there's like a $5,000 fudge factor.” — Jill [10:10]

4. Brokerage Account & Investment Strategy

[11:57]–[13:58]

• Mary’s Concern: Mostly using target date funds across her accounts, wonders if switching to a simple, three-fund portfolio (US stocks, international, bonds) is better.

• Jill’s View:

  • Target date funds are fine for tax-deferred accounts.
  • In taxable (brokerage) accounts, target date funds can create unwanted tax surprises due to capital gains distributions:
    • “I would not use a target date fund in your taxable brokerage account because there can be a lot of tax surprises... we'd rather that happen in your retirement accounts.” — Jill [12:20]
  • As brokerage account balance grows, switch to individual broad US stock index, international index, and intermediate-term bond fund.
  • For asset allocation:
    • “If you don’t love risk, you can go 40% US stock, 10% international, 50% bond. If okay with risk, go 50-60% stocks.” — Jill [13:58]

• Rebalancing:

  • Annual rebalancing sufficient; can be achieved with new contributions rather than triggering taxable events.
    • “...just the new money you're investing... you can really use that.” — Jill [14:01]

5. Estate Planning & Power of Attorney

[10:36]–[10:56]

• Mary has a will and health care proxy, but not a power of attorney.
• Jill explains the importance:
  • “Someone who holds your power of attorney can do those kinds of things for you. ... It's a very easy document.” — Jill [10:56]
  • Practical example: Needed if incapacitated for managing bills or asset transfers.

Notable Quotes & Memorable Moments

• Jill’s empathy and optimism:
  • “So far so good. Really.” — Jill [07:46]
• On Roth vs. Traditional debate:
  • “Let's just not add to that [pre-tax] burden.” — Jill [08:06]
• Mary’s career outlook:
  • “I'm in the prime of my career now, so.” — Mary [03:50]
• On flexible planning:
  • “As that balance grows in your brokerage account, I would get out of the target date fund and ... choose the U.S. stock index, international index, and intermediate term corporate bond fund.” — Jill [13:02]
• Estate advice, keep it simple:
  • “It was very easy to do.” — Jill [10:56]

Important Timestamps

• Financial Overview with Mary: [03:13]–[06:46]
• Pensions & Social Security Discussion: [06:03]–[07:16]
• Roth vs. Traditional Advice: [07:46]–[10:05]
• Estate Planning Advice: [10:36]–[10:56]
• Target Date vs. Three-Fund Portfolio: [11:57]–[13:58]
• Annual Rebalancing Guidance: [14:01]

Key Takeaways and Action Items

• Shift some new retirement contributions into Roth 401(k); experiment with a 10% allocation, monitor the tax hit.
• Continue building brokerage (taxable) account for retirement flexibility, ideally with targeted mutual funds or ETFs rather than target date funds.
• Rebalance investments annually, primarily with new contributions in taxable accounts to avoid unnecessary taxes.
• Add a power of attorney to complete estate documents, using state resources for easy, low-cost solutions.
• Stay the course—Mary’s financial plan is in good shape with only minor tweaks needed.

Jill’s Closing Encouragement:
“Do me a favor, do something really nice for someone else today. Maybe for yourself. That would be nice too. Change your work, change your wealth, change your life. Happy New Year.” — Jill [End]