B (5:20)

She's walking around with a limp, but she's great.

A (5:22)

No, I'm not walking around with a limp, but I do have a little tingling in my toes, which I did send a note to my doctor about, like I just can't. That will not come back. So there is that. Okay. Ann asks, can you speak to the types of investments that are best held in individual versus retirement accounts? Such as, if you have both types of accounts, should you have more heavily invested in bonds in a retirement account and stocks in individual accounts due to taxes? Sure. I mean, ideally the things that create income are better held in a retirement account versus an individual account. Most people can't manage that emotionally. They really can't. So, Mark, do you split it up? Do you have all of your income generating assets like value stocks, dividend producing stocks, bonds? Do you have it more heavily weighted in your retirement accounts?

B (6:11)

Yeah, I would say that's accurate. I mean, nowadays though, we're using, in our taxable accounts we're using muni bonds and muni money markets. So that kind of alleviates that as well.

A (6:21)

Yeah, it kind of depends also where you live and how high your tax bracket is. So sometimes people really do freak out about this and they, they're actually not in such a high tax bracket. So it would be interesting to learn more about like the details of where you live and who you are and what tax bracket you are in. Gary writes, I'm 61. I'm going to be 62 in February. I receive a military retirement of just about $2,000 a month. Monthly net income, 2,500. Should I apply to collect my early Social Security, I could use the money. Hmm. This is a problem because if you really need the money, then I hesitate to say don't do it. However, if there is some other way that we can get you to wait, like maybe it is taking some money out of a retirement account, I don't know. You said you have a military retirement. Maybe you have another account that's an ira, a traditional account. It would be best if you could avoid claiming Social Security early because you are going to take a reduction of about 25%, Gary, for the rest of your life. And if you happen to be married and you have a spouse who's claiming on your record, that will actually also impact and negatively impact the spouse. So we'd have to know more. The time we tell people to claim early is when they really cannot afford to live their lives and then you have no choice. Alternatively, if somebody has a bad diagnosis or a very bad life expectancy outlook, Then also that's another reason to claim early, but otherwise we'd like to avoid that, truly. Okay, Helen writes. Hi, Jill and Mark. I've learned so much from listening, so thank you both. Even though every situation is unique, I see patterns in what you recommend, which is helpful. One of which is to often fund the period between finishing work and starting Social Security by drawing pre tax retirement funds to avoid that tax hit that comes later with RMDs. This makes sense to me. I'm curious if there are any types of situations where you might recommend Roth conversions post finishing work. Obviously, you need the liquidity to pay the taxes and other funds to live off, but you seem to recommend this option much less and I'm curious why. Sincerely appreciate all you do, love your style, cuts to the chase much more than other podcasts while still allowing your personalities to shine through. Listen, I love the idea of conversions, but I think a lot of times we'll talk to people who don't have as much money in brokerage accounts. Don't you think that's the case, Mark? Which is why we tend to just say, take the money as opposed to converting. We don't want to burn up the liquidity that's in those investment accounts. Those taxable investment accounts, right?

B (9:12)

Yeah. Nine times out of ten, I would say that's the reason. I mean, you know, you got to have the money on the sidelines. You don't want to soak up your liquidity as you're heading into retirement.

A (9:20)

Yeah, that's the thing. It's like it really does depend on the case. But look, if you said to me like, I have a million dollars in a retirement account, it hasn't been taxed yet. I have $5 million in a brokerage account. Yeah, let's go. Let's just convert and go crazy. But it really does matter how much money you have available to do the conversion. Okay.

B (9:40)

I think Helen is loaded.

A (9:42)

You do?

B (9:42)

Yeah.

A (9:43)

How do you know that? I don't know.

B (9:45)

I have a sense. Yeah.

A (9:46)

Helen, tell us how much money you have. Come on. Okay. Kara writes, this is the subject. We bought the dream house. Now what? Okay. Hi, Jill. After talking to you and Mark about a year or two ago, I come back to report that we did it. We finally bought our dream house. The purchase price was at the top of our budget. No kidding. I've never met anyone who say, oh, I spend much less than I thought. The purchase price was almost $1.6 million, but we were able to snag a really good mortgage at Five and an eighth. A seven year arm. Sorry, Mark. Everyone's very sad about Mark refinance. He's good. I know my extra cash can make more in the market, but I have been throwing some extra dollars at the mortgage balance in a self inflicted race against time. My concern is that I will not be able to refinance with a better rate within seven years. Or when I go to refinance, the value of my house may have dropped, which would affect loan to value ratios. I'd like to have $750,000 or so as a balance in seven years, which would not feel so tight. All right, some of this is really about how you feel, gang. The current payment, it's pretty high and it's doable. The higher payment, if they went, in other words, if they had to adjust up, would really impact their cash flow. Mark, do you think that Kara is being ridiculous? Should they direct extra cash elsewhere? Or am I being conservative, smart in wanting to obtain a more normal mortgage payment within seven years. Lender says we can recast at any time for a small payment. In seven years I'll have my firstborn starting college. So we would want lower monthly fixed expenses. Okay. Is Kara being conservative too? Conservative? What do you think, Mark?

B (11:38)

Not a move I would make. I mean, my arm is for 10 years, so I got three more years than she does. But the mortgage rate for us is slightly higher. The loan is much bigger. But I am not throwing an extra penny at our loan.

A (11:51)

I mean, look, can I just also say, Kara, getting back to the previous question, it really depends on what else you have that's on your balance sheet. So if you say to me, well, you know, you didn't tell us how old you are. You don't tell us how much money's in your retirement account. You don't tell us how much money. Just in terms of like where you are. Have you saved money for the kids? Education? I need more information. Generally speaking, I like people to feel better. Five and an eighth is not the worst, but I understand how you, you feel about it. I want to see the rest of your assets and know and understand like how, how it all looks.

B (12:29)

Let me, let me fill in a few pieces of the puzzle.

A (12:32)

How do you know this?

B (12:32)

Because that's just how I roll. So we had her on a couple years ago, it was about two years ago, a little over two years ago at that point. $200,000 in their 401s, 600,000 in IRAs. Must have been old rollovers. And that was the bulk of Their assets at the time. So, you know, 800,000.

A (12:50)

And that was two years ago.

B (12:51)

They make 550,000.

A (12:53)

Oh, my gosh.

B (12:54)

In their 40s. So they're mid-40s.

A (12:57)

They're in their mid-40s. I would. Okay, here's what I would do. I would put as the money you're putting down, I would definitely say for five years, you can build up into a retirement into a brokerage account. I would like to see the brokerage account get as beefy as possible so that if there is a problem down the line and there is no chance to refinance between now and seven years from now, you would be able to just figure it out and pay a bunch of this down. So, yeah, I'd rather have access to my money. And you're young. That's the other thing. I really think that's the piece of it that is important, which is I hate for that money to be just sitting there paying down that mortgage and not have the flexibility of doing something else. Now, do you think that this is all for naught, Mark? Because I do sense that this might be a situation where she's like, I can't deal with it.

B (13:51)

Perhaps, but seven years, you're going to have an opportunity to do refinance.

A (13:56)

I think so, too. I think so, too. All right, you ready for the last question of the day, sir? Here. Oh, I love this already. The subject line, should I go for the promotion? Hey, Jill and Mark, I listen to your show every morning as a get ready for work, and I'm a big fan. To me, personal finance is like a big puzzle, and I enjoy listening to you work through many different scenarios and problems. Okay. I'm starting to feel burnout at work, and I'm being pushed by my company l leadership to take on even more responsibilities. And so this promotion would mean that I would expect to see a 10% increase in salary, 50% increase in bonus. I'm not sure if it's worth the extra stress. I want your help in deciding. I love these questions, Mark. At this point of my career and net worth, I want the ability to take short breaks and move into more enjoyable work. This would not be a retirement. I want to work more on my own terms, such as remote or contracting. I guess you could say I'm ready for a quote, great money reset. Maybe you should buy a book like that. I've never had any financial advice other than the fire websites. Financial independence, retire early. Okay, ready for the information already. I can make this decision. I just did A quick scan 41 year old single dude, okay, makes about 250 grand a year. Here's what he has. He's got an IRA worth 462 grand. A Roth with 165, a 401k with $700,000, another $600,000 in brokerage, HSA, 85 cash, 135 pension. Oh my God. Pension, which he treats as a bond. The present value of the pension, 47 grand. Total liquid net worth $2.2 million. He's single, ladies and gentlemen. He's got a primary house that's worth a half a million bucks. There's absolutely no reason that I, by the way, if I felt burnt out in this place. In your current organization, you're 41, you've got a lot of flexibility. You are letting this flexibility and all this savings really amount to nothing if you don't take advantage of it. Okay? So you know, right now he in his 401k saves 70 grand. He puts 50 grand into his brokerage, he maxes out his HSA, okay? His spending is like bupkis, 60 grand a year. Here is the game plan I'm going to already, I'm already excited about this. My plan is to continue to work for the next two and a half years. He's going to get a bonus and some restricted stock units. And he says, I expect my cash and brokerage would be worth about a million bucks. Then I quit, quit and take a break. Then I would spend about 60 grand a year for 16 years until 59 and a half. I'd spend it from my brokerage and my cash accounts, leaving my retirement accounts to compound. After a three month break or so, I'd begin looking for a new job. Probably making more like half of what he makes now. Better work, life, balance. Then he could keep doing it to 50 or 55. What do you think of my plan? Should I forego the promotion, keep my current job and work to mitigate the burnout by asking for some different responsibilities so I can make it the two and a half years. If I stopped after two and a half years, am I good? From 59 and a half on, based on what I already have, am I good now? Should I just invest more in brokerage? He's very uptight, West Coast Rob. So, you know the only reason why I think you go for a promotion is if you're like psyched about it, you're already bummed out and burnt out and I wouldn't do it. So Mark, what about you?

B (17:31)

No, no way. I mean, I think he kind of answered his own question. I mean, he talks about being burned, burned out. You know, he wants to work more on his own terms, take short breaks, more enjoyable work. So it sounds like, pretty obvious that he doesn't want to do it. I just don't, you know, if he turns around and tells them no, what's that going to do for his environment?

A (17:48)

Yeah. So the question is, you can say to them, look, I'm not ready to do this right now. Can we revisit this in a year and see what they say? You don't have to say, oh, by the way, and I'm out. I'm outdoor in two and a half years. But you just push it off. Just say, you know what? I'm really, you know, I'm doing different things. It's a lot right now. I, you know, the job's good as it is, blah, blah, blah, whatever. Now, if they are like, either you take the promotion or you're out, that's a different question. But you have a lot of money, and I don't think there's a problem. I think that the two and a half years is fine. I mean, it seems to me the two and a half years is almost arbitrary. But, you know, he's got enough money, he can do this. Right.

B (18:29)

It's unbelievable. He's only 41, how much money he's got.

A (18:32)

I know. I'd love to talk to you more about it. I very much believe that if you are 40 years old and you are fried, that's not great. And I don't want you to feel locked into a. Into a job, especially because many people who are locked in are locked in, and they really are locked in, like, they cannot make a different decision. You know what? You can. So I think West Coast Robert has got, like, really good prospects. I would gently say to the boss, look, I've never been asked to take a promotion. So I, I believe me when I say this is. I. I'm sort of dealing with, like, how other people I know have dealt with this, not me personally. When people have been asked to take bigger jobs and they don't want to take them, I think the way to couch it is, look, I am really good where I am now. I'm somewhat concerned that it will not be the same. I really don't know if this is, like, the point where I'm ready to do it. Let's revisit this in a year. By that time, they will have moved on to someone else and no one will ever remember what happened. That's my guess. Don't draw a line and don't quit right now till we talk to you again. Good? All right. Good. Okay, gang, Are you going for a promotion? Are you hanging on for dear life? Are you a job hugger? Are you freaking out? Are you feeling good? Whatever it is, get in touch with us. Go to jillonmoney.com, click the contact us button and write us a note. If you want to come on the air, check the box. That's how we usually roll on this show. We'd love talking to you, but if you want to do the email only, give us lots of details. Like West Coast Rob. I just called him Rob. I don't know. He said Robert. I'm calling him Rob. And if you want further information about us and what we do, just click around that jillonmoney.com website. Hey, you can subscribe to us on the Odyssey app or wherever you find your favorite podcast. Would you mind please leaving us a rating and review wherever you listen? And of course, 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. Hey gang, here's the thing about wine. Some of the best bottles are not sitting on a store Shel. They're being crafted at small, independent wineries. But those wines can be so hard to find sometimes. I wish I had a personal sommelier to guide me to find the best wines I normally wouldn't be able to access. Where's that handcrafted pinot that I've been craving? Well, Psalmsation's expert team seeks out incredible wines from top independent producers. These are bottles that you will not find in stores and on shelves. And they aren't mass produced wines. They're handcrafted with care, using pure ingredients and meticulous winemaking. Whether you want a single bottle, a guided tasting experience, or an entire wine club membership, Psalmsation makes it easy to elevate your wine experience. Shop their wines@psalmsation.com jillonmoney that's somsation.com jillonmoney 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.