Should I Refinance to Fixed Rate?

Summary

Jill on Money with Jill Schlesinger: "Should I Refinance to Fixed Rate?"

Date: November 25, 2025
Host: Jill Schlesinger, CFP®
Producer/Co-host: Mark Tularcio
Episode Theme:
Jill Schlesinger tackles a series of detailed listener questions focused on smart money management: Roth conversions, retirement plan contributions, mortgage decisions in the current rate environment, estate planning with stock inheritances, long-term savings for a home, and dealing with significant credit card debt. The episode offers practical strategies and candid advice, with Jill and Mark’s signature approachable, jargon-free style.

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Key Discussion Points & Insights

1. Roth IRA Conversion Versus Withdrawal for Retirement (Graham from Australia)

[02:39-05:22]

• Question: Graham, semi-retired with a sizable IRA, Roth, brokerage account, and sufficient cash, asks if he should convert IRA funds to Roth or simply withdraw them to his brokerage.
• Main Consideration: Paying taxes in a low-income year. Goal is to draw down the IRA within the 12% or 22% tax bracket.
• Mark’s Input:

  "He's got a lot of money in the brokerage account to pay the tax bill. And he's got cash. If leaving this money as a possible inheritance...the Roth is a great account to inherit. If that's not part of the plans, probably inclined to just pull it out." — Mark (05:05)

• Jill’s Advice:

  "Since you have the ability to convert, the real question is what happens to your money after you pass away. If it’s going to kids, the Roth is the better asset to inherit... No mistake to be made. Mark’s leaning more towards take the money out. I could go either way. I really am on the fence." — Jill (05:22)

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2. Switching to a Roth 403(b) for Retirement Savings

[05:22-07:17]

• Question: Listener “Y,” age 54, asks about moving contributions from a traditional 403(b) to Roth 403(b), concerned about its impact on take-home pay and taxes.
• Jill’s Core Point:

  "You will [bring home less money], that's the first thing that you're going to realize…and when you file your taxes, you might find that you’ve paid more in taxes. The reason you would only do some different amount to the Roth versus the traditional is you’ve got to double check with your job to see if there’s a match." — Jill (06:20)

• Mark’s Strategy:

  "Ease into it…do 5% pretax, 5% Roth. See how it impacts the check. If it's no big deal, just keep going up until…you can just stomach it all." — Mark (07:06)

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3. Should I Refinance My 10-Year ARM to a Fixed Rate Mortgage? (Anonymous)

[07:17-08:26]

• Question: Listener with a condo purchased in 2022, $88K left on a mortgage at 4.125% (10-year ARM), offered a 15-year fixed at 5.625%. Should they refi or ride out the ARM?
• Jill’s Response:

  “It’s only $88K left…You’ve got this rate of 4.125. Would you lock in at 5.625% for a 15-year right now, Mark?” — Jill
  (08:14)

• Mark’s Input:

  "I don't think so." — Mark (08:25)

• Jill’s Prognosis:

  “I think that I am a terrible prognosticator about these things. But I do think that rates are probably heading lower...before 2032, do I think you’ll have a chance to refi? Yes, I do.” — Jill (08:26)

• Takeaway: Best to wait rather than refi at a higher rate now.

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4. Transferring Hershey Stock Inheritance with Minimal Tax (Dan in Alaska)

[08:26-11:28]

• Question: Dan’s elderly parents have $2M (including $500K in Hershey stock). Their will stipulates the Hershey stock remains in the family. What’s the smartest, most tax-efficient way to pass it on?
• Jill’s Strong Recommendation:

  “I say absolutely a transfer on death, like not even close. You must have it transfer on death. That will allow it to pass quickly ... You get a step up in cost basis of that Hershey’s stock, which means there should be no capital gains. You’ll inherit the stock. ... Having so much of their wealth in one stock is insane. ... And to think that they are putting that pressure on you. God bless 'em, but thanks for the money. ... I would never ever put that kind of limitation on [my heirs].” — Jill (09:57)

• Key Point: Use a Transfer on Death (TOD) registration for smooth transfer and tax benefits; diversify after inheriting.
• Memorable Rant: Jill challenges the wisdom of tying family members to inherited concentration risk.

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5. Saving Toward a Condo Purchase at Age 64 (Lisa)

[11:28-14:03]

• Question: Lisa, age 64, wants to save up for a condo in ~7 years, already has $200K toward the goal, a solid income, and low expenses. Where should she save/invest as she eyes the $500-$600K target?
• Jill’s Take:

  “That’s a lot of pressure to put on yourself if you want to save…to at least be in the position to be able to do so, you would have to put more of the money in the non-retirement assets… But if you like where you live and the rent isn't so bad, just keep doing what you're doing.” — Jill (13:51, 14:03)

• Mark’s Advice:

  “I think she’s asking, like, should I invest it or keep it in cash? I certainly wouldn’t keep it in cash because seven years is a long time. ... She should be invested.” — Mark (13:51)

• Final Thought: Keep enough liquid for emergencies; invest other savings for growth over seven years; don’t feel pressured to buy if renting works.

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6. Should You Sell Stocks or Tap Retirement Accounts to Pay $50,000 in Credit Card Debt? (Kimberly)

[14:03-14:53]

• Question: With $50K in credit card debt (mixed low/high rates), is it smarter to sell stock or pull from retirement savings to pay it off?
• Mark’s Stance:

  “Stock, yes. Retirement account I would avoid at all costs.” — Mark (14:45)

• Jill’s Addendum:

  “It’s not great to pull money out of a retirement account, pay tax on it, use that to pay down a credit card. ... We’d love to know more about you.” — Jill (14:53)

• Guidance: Selling securities is preferable to raiding retirement accounts; more personal details needed for a tailored answer.

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Notable Quotes & Memorable Moments

• "If leaving this money as a possible inheritance…then yeah, sure, the Roth is a great account to inherit. If that's not part of the plans, probably inclined to just pull it out." — Mark Tularcio (05:05)

• "Since you have the ability to convert, the real question is what happens to your money... If it’s going to kids, the Roth is a better asset to inherit." — Jill Schlesinger (05:22)

• “Ease into it…do 5 pre-tax, 5 Roth. See how it impacts the check…” — Mark Tularcio (07:06)

• "Having so much of their wealth in one stock is insane. ... And to think that they are putting that pressure on you. God bless 'em, but thanks for the money." — Jill Schlesinger (09:57)

• “I am a terrible prognosticator about these things. But I do think that rates are probably heading lower. ... Before 2032, do I think you’ll have a chance to refi? Yes, I do.” — Jill Schlesinger (08:26)

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Key Timestamps

• Listener Roth Conversion dilemma: [02:39–05:22]
• Switching Retirement Contributions to Roth: [05:22–07:17]
• Refinance Fixed Rate vs. ARM Debate: [07:17–08:26]
• Hershey Stock Estate Planning: [08:26–11:28]
• Long-term Condo Savings Plan: [11:28–14:03]
• Paying Off $50K Credit Card Debt: [14:03–14:53]

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Summary Takeaways

• Roth conversions may make sense, especially in low-income years, but consider legacy goals and tax rates.
• When enrolling in Roth retirement plans at work, expect lower take-home pay, and ease into contribution shifts if unsure.
• Don’t refi from a low ARM to a higher fixed unless you need certainty—rates may improve.
• For inherited assets, use Transfer on Death to simplify transfer and maximize tax benefits; don’t get tied to family stock “legacies.”
• Seven-year home savings should be invested (not in cash), but don’t put undue pressure on yourself to buy.
• Avoid raiding retirement to pay credit cards—selling investment account assets makes more sense.
• As always, Jill and Mark recommend reviewing your specific situation—reach out for custom advice!

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Transcript

[Jill Schlesinger]

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[Mark Tularcio]

Mark Tularcio Even though you'll be out of the country, I will almost certainly be hearing your voice as I edit you.

[Jill Schlesinger]

How is that possible? Didn't we do everything in advance of my two week vacation?

[Mark Tularcio]

Well, yeah, we recorded everything. Just doesn't mean everything's put together.

[Jill Schlesinger]

Oh yeah, that's right. That's your work. Oh, you're such a hard job. I'm so sorry. Listen gang, while I'm on break, don't worry, Mark's there manning the email. And if you've got a question, if anything is going on in your financial life, if you're just so sick of your family now, need a break from Thanksgiving, then just hop upstairs or get on your Phone and shoot us a note. All you need to do is go to jillonmoney.com in the upper right hand corner is the contact us button. Write us a note. And if you want to join us live, check the box. Mark will bring you on the air with us. While you're on the website, please do check out all of the content that lives there. Mark does a wonderful job with the website and so we are so grateful for that. And I know you are. I know I am. Okay, Mark, let's do some emails while I'm still in the country. Here is a question from Graham. It's about a Roth, so stay. Oh, it's Graham from Australia. I love him so much. Okay, so this is Graham, who is a recidivist questioner and he's a great listener. He lives in Australia. Here is his question. I'm wondering if I should do a Roth conversion or just withdraw the amount of money from my IRA and put it in my brokerage account. So here are some of the background. Graham says we have enough money to live on and I'm semi retired. I'm trying to draw down my IRA to have taxable income in the 12 or 22% tax bracket. We didn't have as much retirement income or semi retirement income this year. Why? They were on a boat in the Great Barrier Reef. Come on. That's so awesome. Humble brag. Okay, question is, what I don't know is whether I should cash out the IRA amounts and then just move them to my brokerage account or should I put it into the Roth, convert it. Either way, I think it is wise to pay the tax now while my income is lower. See, I have learned something listening to your show. So here is the amount. The IRA's got a million bucks. There's 200 grand in the Roth and he's got a half a million dollars in a brokerage account. He's got pretty low expenses. He's got income that is, let's see, about $70,000 in income. And he's got some other stuff going on. So here is the question mark conversion. Or do we just say pull it out and add it to the brokerage? He's got cash, by the way. He's got two years of cash on hand, 150 grand. What do you think? Should he start converting or should he just take the money out to pull the money down?

[Mark Tularcio]

I mean, he's got a lot of money in the brokerage account to pay the tax bill. So he. And he's got cash and he's got cash. And you know, if leaving this money as a possible inheritance one day, if he's thinking of that, then yeah, sure, the Roth is a great account to inherit. If that's not part of the plans, probably inclined to just pull it out.

[Jill Schlesinger]

I agree that since you have the ability to convert, the real question is what happens to your money and after you pass away, if it's going to kids, the Roth is a better asset to inherit. On the other hand, if they inherit a, if they do inherit a brokerage account, they do get a step up in cost basis. So there's no mistake to be made. Mark's leaning more towards take the money out. I don't know. I could go either way. I really am on the fence. I'm rarely on the fence. This person has a very identifiable first name. So I'm just going to call this person y who is 54 years old. Just found out my job is offering a Roth 403 account. I'm currently contributing 10% to a traditional 403 and I'm thinking of moving it to 10% to the Roth. Is there a reason why I shouldn't do the full 10%? How will my paycheck be affected? Will I be bringing less money home since this would be tax versus pre tax? Yes, you will. That's the first thing that you're going to realize, which is, oh, my actual paycheck is not going to look as big. And when you file your taxes, you might find that you've paid more in taxes right now the reason that you would only do some different amount to the Roth versus the traditional is you've got to double check with your, with your job to see if there is a match. Oftentimes, Mark, you've, you've, you've run into this a lot, which is a lot of companies require you to put money in the traditional in order to capture the match. But since it's a 403B, I don't know if there's a match or not. It really depends on what your tax bracket is. You may not see a huge difference if it's 10% or you might be like, oh, this is more than I could imagine.

[Mark Tularcio]

I mean, yeah, or just ease into it, you know, do 5 pre tax, 5 Roth. See how it impacts the check. If it's no big deal, just keep going up until, you know, maybe you can just stomach it all. No big deal.

[Jill Schlesinger]

Yeah, that's true. That's a great idea. Mark. Anonymous wants to know about her mortgage or his mortgage rate. Their mortgage rate. Okay, Anonymous has a 10 year arm and the question is refi or ride it out. Okay, here are the facts. I bought the condo in May of 2022 and the rate is currently 4.125%. I paid off a lot early and only have about 88 grand left on the mortgage. Now I just pay the minimum. In a recent email from the bank it shows a 15 year fixed at 5.625%. Remember it's a 10 year arm. Does your crystal ball have any answers as to whether rates will drop further? It's only 88 grand left. I mean I don't know if you should. You've got this rate of 4 and 0.125. Fix it mark, and make it a 15 year or just you know, keep paying it back. I don't know. The problem for me is I don't know how what your other money looks like, what your other assets are. Would you, would you lock in at 5.625% for a 15 year right now, Mark?

[Mark Tularcio]

I don't think so.

[Jill Schlesinger]

I wouldn't either. I think that I am a terrible prognosticator about these things. But I do think that rates are probably heading lower. Not like dropping down, but before 2032. Do I think you'll have a chance to refi? Yes, I do. So hopefully that helps you out. Anonymous okay, this is from Dan Dan in Alaska who writes My 92 year old parents live in Pennsylvania. They've got $2 million total and of that, I don't know if this is of that or separate of that. They have $2 million total, half a million dollars in Hershey stock. Oh my God. They want this stock to stay in the family after they pass on. My question is how to make this happen with the least amount of estate tax, capital gains and commissions. Their will says that the stock stays in the family but I think that the best option is to re register their account as a transfer on death. Is it better to save on fees, taxes for them to set up a transfer on death or let the will transfer this stock? Okay, these are two distinct questions from a passing of assets frame. I say absolutely a transfer on death, like not even close. You must have it transfer on death. That will allow it to pass quickly when they pass whoever the last survivor. So the survivor passes away, right? Spouse one dies, money goes to spouse two, spouse two dies, the transfer on death will kick in goes down to you guys. You get a step up in cost basis of that Hershey's stock which means there should Be no capital gains. You'll inherit the stock. Can I just get to the stock? In itself, it is asinine to say that they want the stock to stay in the family after they pass. That is an absolutely ridiculous bar that they have put in front of you. And if you want to nod your head on this, fine. But as soon as that happens, having so much of their wealth in one stock is insane. It's just insane. And to think that they are putting that pressure on you. God bless him, but thanks for the money. But that's. I would never ever put that kind of limitation on. And aren't you all in different situations in your lives? I mean, it seems completely bananas that they would do that. Don't you agree, Mark?

[Mark Tularcio]

Well, clear. The parents live in Pennsylvania. They got this Hershey stock some. Clearly somebody has a tie to Hershey.

[Jill Schlesinger]

Yes, but I mean also it's. Yeah. And it's crazy. And by the way, I think what's also really terrible is that like it's a. It's a really bad game plan to have this one stock be such an important part of their. Of their entire estate. By the way, from an estate tax point of view, I believe that Pennsylvania has that flat rate. It's a very weird system. So they have a death tax commissions. Don't worry about when you get your stock, Dan, in Alaska, you'll inherit it. You'll get a step up in cost basis, which means the inherited value of the stock will be the date of death valuation of the stock. And then you should do whatever you want with it because to keep it in one company is crazy. Come on, people. Why are we making this so hard? Lisa writes. Thank you for your insight, expertise and show. I listen every week. Oh, I wonder if there's a radio listener. I am trying to save money to hopefully maybe be able to buy maybe a condo of my own in about seven years. Okay, good for you. Lisa currently has $200,000. Towards the goal, she estimates she'll need about five to six hundred thousand dollars. I save any extra money I have and distribute my savings between a high yield savings account, my two IRAs with a combined $200,000 and, and a Schwab account which is mostly exchange traded funds. And there's a small Vanguard account. I am contributing to my current retirement plan at work. There's $36,000 there. I continue to fund my emergency savings. I have no intention or plan to ever retire. Ah, Lisa, I don't know how old you are, but this is. Oh, here we go. Lisa's, 64. Other people have made poor decisions with their finances. It has really impacted me. My income, $150,000 annually. Living expenses are small. I want to be efficient. She's in the 24% tax bracket. As I said, she's 64 years old. I believe that when I reach 70 years old, my tax bracket will go down. Where would you put money to save towards this goal of the condo? Thank you again for all you do for empowering people with their finances. I appreciate you and your team. By the way, team is me and Mark. Mark, seven years.

[Mark Tularcio]

So I guess she's trying to buy this thing outright.

[Jill Schlesinger]

Cash. Yeah. I hate that that's actually the goal because to some extent I don't know what your rent is but like that's a lot of pressure to put on yourself if you want to save. To at least be in the position to be able to do so, you would have to put more of the money in the non retirement assets. But then again you'll be able to tap. If it's seven years and you're 64 years old, you can tap any of the money anyway. So Mark, is there any, you know, is. Should she just throw it all into the 403B? I don't know, like maybe it's a little bit of everything.

[Mark Tularcio]

I think she's asking like should I invest it or keep it in cash? I certainly wouldn't keep it in cash because seven years is a long time.

[Jill Schlesinger]

Yeah.

[Mark Tularcio]

So you got to invest it if it's either, you know, if it's the retirement account or it's the brokerage account. But is she should be invested?

[Jill Schlesinger]

Yeah, it definitely be invested. The cash you have on the sidelines is for your emergency reserves. And if you have a very low rent right now, I would not be so compelled about the whole condo purchase. I know you want to give yourself the chance to but if you like where you live and the rent isn't so bad, just keep doing what you're doing. It's going to be fine. You're going to be good. Sounds like you don't spend any money. I'm sure she's going to be like, I can live on my Social Security at age 70. It's amazing. Kimberly has credit card debt. $50,000. You ready for this? Some is low interest rates, some high. What are your thoughts on cashing out stock and or using retirement account funds to eliminate this debt? Well, Mark, would you like to get on your soapbox about selling stock?

[Mark Tularcio]

I mean there's a lot more we need to know. But just based on what I have in front of me. Stock, yes. Retirement account I would avoid at all costs.

[Jill Schlesinger]

Yeah, we need to know more about you. But yeah, I mean, it's not great to pull money out of a retirement account, pay tax on it, use that to then pay down a credit card. But we'd love to know more about you. So definitely follow up with us because we really, I think that this is one of those situations where more information would give us a little bit more ammunition to help you out. Okay. So get back in touch with us. Okay, everyone else listening. We are so grateful that you come back. Every day. Monday throughout Friday, we encourage you to check out our weekend show, which is called Money Watch. Saturdays and Sundays, we go a little bit deeper into some of the issues that we discuss here on this program and we love to hear from you. So go to jillandmoney.com, click the contact Us button, send us a note about whatever's on your mind. And if you'd like to join us on the air, just check the box. Mark will do everything else. Hey, don't forget to sign up for the free weekly newsletter comes out every Friday. You can subscribe to us on the Odyssey app or wherever you find your favorite podcasts. We encourage you to do something nice for someone else today. Change your work, change your wealth, change your life. Thank you for listening and we'll talk to you tomorrow. Your business identity is everything that shows what your business is about, from what customers see to what they don't see, like operating agreements, meeting minutes and compliance paperwork. Get more for your business, more privacy, more guidance and more free resources with Northwest Registered Agent. Northwest Registered Agent has been helping small business owners and entrepreneurs launch and grow businesses for nearly 30 years. They're the largest registered agent and LLC service in the U.S. build your business identity fast with Northwest Registered Agent and get access to thousands of free resources, forms and step by step guides without even creating an account. Don't wait. Protect your privacy. Business Build your brand and get your complete business Identity in just 10 clicks and 10 minutes. Visit www.northwestregisteredagent.com Jill Free and start building something amazing. Get more with Northwest registered [e-mail]. jill Free what's up?

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