The Administration and a Market Crash

Summary

Podcast Summary: "The Administration and a Market Crash"
Jill on Money with Jill Schlesinger
Release Date: March 25, 2025

In the March 25, 2025 episode of "Jill on Money with Jill Schlesinger", host Jill Schlesinger delves into pressing financial concerns faced by everyday individuals. The episode, titled "The Administration and a Market Crash," features Jill addressing listener questions that range from mortgage strategies to the stability of Social Security. Through insightful discussions and expert advice, Jill ensures listeners are equipped to navigate complex financial landscapes with confidence.

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Introduction

The episode kicks off with Jill welcoming listeners and encouraging them to engage with the show by submitting questions via the website jillonmoney.com. She also announces the return of their sister podcast, "Money Watch," which focuses on the critical aspects of personal finance, offering deeper dives into foundational topics.

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Listener Questions and Expert Advice

1. Mortgage Payoff vs. Investing: Judah's Dilemma

Timestamp: 1:58 - 4:45

Listener Inquiry:
Judah poses a compelling question about whether it's more advantageous for a 30-year-old with a paid-off house to pay down the mortgage early or to invest the equity. He cites the argument that avoiding a mortgage might be financially wiser and asks, "Would you advise a 30-year-old with a paid-off house take out 80% of the equity and invest it? If not, then why not pay it down early?"

Jill's Response:
Jill thoughtfully considers the balance between investment opportunities and the accessibility of funds. At [04:00], she states,
“Once you've paid off a house, it's not just an investment decision. It's about your ability to access the equity in your place.”
She advises caution in taking out significant equity, especially with higher interest rates.
“If rates are at 6%, I might make a different choice. You may not just want to invest it, but you might want to have access to it,” Jill explains ([04:30]).
However, she concedes that with lower rates, such as 3%, leveraging equity for investment becomes more favorable, highlighting flexibility based on economic conditions.

2. Social Security Stability Concerns: Susan's Anxiety

Timestamp: 4:45 - 6:56

Listener Inquiry:
Susan expresses deep concern over potential cuts to Social Security, especially after enduring a recession-induced retirement loss in real estate and forced early retirement. At [05:00], she shares,
“I'm almost 67. I rely on Social Security and a small retirement pension... How do I handle paying monthly expenses and credit card debt if my Social Security payments are late?”

Jill's Response:
Jill offers reassurance, expressing skepticism about imminent Social Security cuts.
“They're not late yet, and I’m hopeful that we're not going to see this,” she assures ([05:15]).
She emphasizes the political influence of Social Security recipients, noting,
“Remember how many people receive Social Security benefits? Remember how many of those people vote?” ([05:30]).
Jill acknowledges the fear surrounding economic instability but maintains optimism regarding the protection of Social Security benefits.

3. Managing Elder Care and Estate Planning: Nelson's Complex Situation

Timestamp: 6:56 - 10:11

Listener Inquiry:
Nelson outlines a multifaceted challenge involving his 84-year-old mother diagnosed with dementia. He seeks advice on maintaining family ownership of their mother's home while ensuring sufficient funds for her escalating care needs. Nelson’s detailed query involves managing a living trust, the potential sale of the family home, and the financial implications thereof.

Jill's Response:
Jill breaks down the complexities, starting with tax considerations in California.
“If you're worried because you're going to have a big, big capital gains to pay, right? Because she can only exclude $250,000 of this house,” she points out ([07:15]).
She suggests practical steps such as having the sister move into the house and pay rent to cover expenses, thereby keeping the property within the family while maintaining financial flexibility.
“Your youngest sister doesn't have to do anything except pay rent, which would be covering the expenses,” Jill advises ([10:00]).
This approach allows the family to preserve ownership without immediately liquidating assets, ensuring funds remain available for future care needs.

4. Evaluating Financial Advisor Fees: John's Cost Concern

Timestamp: 10:11 - 11:22

Listener Inquiry:
John questions the standardness of a financial advisor charging 1% of the portfolio, which amounts to $6,000 for his and his wife’s current investments. He is wary of high fees and seeks clarity on whether this percentage is customary.

Jill's Response:
Jill confirms that a 1% fee is typical for portfolios up to a couple of million dollars. However, she underscores the importance of the advisor’s role beyond mere money management.
“If that person is not doing anything but managing your money, I wouldn't do it,” she cautions ([10:45]).
Conversely, if the advisor is a comprehensive financial planner offering strategic guidance, the fee might be justifiable.
“If that person is a financial planner, then I might consider it,” Jill adds ([11:00]).

5. Political Influence on Market Stability: Another John's Speculation

Timestamp: 11:22 - 12:34

Listener Inquiry:
Another listener, also named John, speculates whether President Trump might deliberately induce a recession and a subsequent stock market decline to enable others to purchase assets at lower prices. At [11:30], he asks,
“Do you think it's possible that President Trump may want to take us into a recession and a lower stock market so others can buy at a lower price?”

Jill's Response:
Jill addresses the speculative nature of the inquiry with pragmatic advice rather than political analysis.
“If you have $1.7 million and you've got enough money in cash and bonds, then you can ride this out,” she advises ([11:45]).
She emphasizes personal financial management over concerns about administrative motives, suggesting a focus on adjusting one's risk profile if necessary.
“Don't switch back when markets change because they will change,” Jill recommends ([12:00]).
Her emphasis remains on individual strategy and resilience in the face of market fluctuations.

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Conclusion

In this episode, Jill Schlesinger adeptly navigates a spectrum of financial concerns, offering personalized advice grounded in practical considerations. From mortgage strategies and Social Security fears to complex estate planning and advisor fee evaluations, Jill equips her audience with the knowledge to make informed decisions. Her responses blend empathy with expertise, ensuring listeners feel supported in their financial journeys.

Listeners are encouraged to continue engaging with the show by submitting questions and subscribing to both "Jill on Money" and its sister podcast, "Money Watch," for ongoing financial guidance and insights.

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Notable Quotes:

• Jill on Mortgage Equity Access:
  “Once you've paid off a house, it's not just an investment decision. It's about your ability to access the equity in your place.” — [04:00]

• Jill on Social Security Confidence:
  “Remember how many people receive Social Security benefits? Remember how many of those people vote?” — [05:30]

• Jill on Financial Advisor Fees:
  “If that person is not doing anything but managing your money, I wouldn't do it.” — [10:45]

• Jill on Market Fluctuations:
  “Don't switch back when markets change because they will change.” — [12:00]

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This comprehensive summary encapsulates the essence of the episode, ensuring that both existing listeners and newcomers gain valuable insights into managing their finances amidst uncertain economic and administrative landscapes.

Transcript

[A]

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[B]

Welcome to the Jill on Money show. It's Tuesday, March 25th and we are here trying to help you make better, less bad, more considered financial decisions. If you have a question, all you need to do is go to our website, jillonmoney.com click the contact us button. Write us a note. That's the email we receive. If you would like to join us live, just check the box. Mark will do everything else. And of course just bookmark our website because everything we do lives on that website. Also, wanna remind you that we have another podcast. Many of you were subscribers to this podcast already and then we stopped doing our Saturday and Sunday versions. But wait, we're back to doing Saturdays and Sundays, but it's in a different feed. It's in the Money Watch feed. So wherever you get this podcast, you maybe perhaps are on the Odyssey app or somewhere else. You should also subscribe to our sister broadcast, Money Watch. And we're really trying to focus on some of the more, I don't know, like I was going to say basic, but it's really not that. It's the critical parts of every person's financial life and we go a little bit deeper into each topic and we take our time. So if you've got somebody in your life who you think could use a little bit more of the going back to basics and making sure they've got all the building blocks, or if you want that, Please subscribe to MoneyWatch. All right, let's do some emails. Mark says they're piling up. All right, this is from Judah, who writes the best argument that I've heard for why you should focus on paying off the mortgage rather than investing more is that if you had paid for a house, you wouldn't go and take a mortgage just to invest that money. So my question for you is whether you think that's true. Would you advise a 30 year old with a paid off house take out 80% of the equity and invest it? If not, then why not pay it down early? Let's assume rates are around 6%. Thanks again for the show and all.

[A]

Of your great advice.

[B]

My goal is to one day be one of those people who calls into the show and has you and Mark laughing at the absurd amount of money that they've saved. Well, okay, first of all, once you've paid off a house, it's not just an investment decision. It's about your ability to access the equity in your place. So if I had to do it all over again and rates are at 6%, you know, I might make a different choice. I would say, well, why are you paying that down? You may not just want to invest it, but you might want to have access to it.

[A]

So here's what I would say.

[B]

If you're a 30 year old and a paid off house, would I take out 80% of the equity and invest it? Probably not. If rates are at 6%, would I take 80% of the equity and invest it? If my rate was 3%?

[A]

Yeah, I actually would.

[B]

I would definitely do that. And that's what happened during COVID when everybody was refinancing. They were refinancing to lower rates, taking money out and either paying down debt or Investing it. The thing that I think is hard to imagine when you're 30 years old is how you might need your money in the future. You might need your money to put kids through school. You might need money because you've lost your job and you're not at your retirement date yet. You might need your money because you have a health emergency with a paid off house, you really are stuck. You may be able to get the money with a home equity line of credit, but you don't know where rates are going to be. So if you want to give us a holler Judah and follow up about maybe what you would do, if your current situation is that 6% number, then I'm happy to talk about it. But I'm also very interested to find out everything else going on in your financial life. I hope that helps. Okay, this is a question from Susan who is worried about what she says is the threat to Social Security personnel cuts could threaten the reliability of our payments. Due to the recession, when I suffered significant retirement loss in real estate along with my employer forced early retirement, my retirement savings is practically gone. Oh gosh, I hate this. I'm almost 67. I rely on Social Security and a small retirement pension through my state. I only have a few thousand dollars in emergency reserves. My credit is very good. High score in the high seven hundreds. How do I handle paying monthly expenses and credit card debt if my Social Security payments are late? Well, they're not late yet, Susan. And I'm hopeful that we're not going to see this. I think that if we are worried about the payments system, this to me would be the one place where I doubt that. I mean, and I've been wrong about this, about other things. So I just doubt that it is a Social Security, a Social Security issue. Okay. That they would be messing with. Remember how many people receive Social Security benefits? Remember how many of those people vote? But it's hard.

[A]

It's scary.

[B]

It's really scary. This, this is a question from Nelson. My 84 year old mother has been diagnosed with dementia and Alzheimer's. She's moved out of her home and into mine. We live in California. I am retired. I've taken on full time caregiving duties with assistance from my wife who works full time. I have two younger sisters who work full time. They visit on weekends to assist with caregiving, to give me a respite. We're trying to care for mom and ourselves until such time as she might require a higher level of care in the home or potentially move into an assisted living or memory care facility. Our mother has an estate plan which has her home and accounts in a living trust. The trust has my sisters and me as the successor trustees. 1/3 interest in the trust estate. My mother has had me manage her finances fully for over five years now. I estimate that if she were to require a higher level of in home care or live in an assisted living or memory care facility, she would have enough funds to cover her for at least a few years of care. If those funds were to run low in the coming years, we would have to sell her house to fund additional care as that would be her only remaining asset. Our mother's neurologist has determined she can no longer make meaningful decisions with regard to financial, legal or medical matters and has provided a written statement. She has a durable power of attorney advanced healthcare directive which names my sisters and me as being responsible. Okay. Currently the house is vacant, but my youngest sister has expressed an interest in moving in. She has proposed purchasing the house after selling her current home. This tracks to our mother's expressed desire in the past to keep the family home in the family. It would also provide a source of funds should they be needed for additional future care. However, since our mother doesn't actually need the extra funds at the present time, it doesn't make sense from a tax perspective right now. What other financial options should we consider? We would love for our youngest sister to keep the house in the family. We'd love to have our mother's home not be vacant. But we also don't want to hinder mom's care if she needed more funds than she has down the road. What advice do you have that could allow us to keep both ideals in focus? You have the solution, my friend. Listen, Nelson, I guess I don't know how much the house is worth. It's California. So let's assume you're worried because you're going to have a big, big capital gains to pay, right? Because she can only exclude $250,000 of this house, right? So I don't know, I just feel like just pay it because what's the difference? And the alternative is you wait. You know, it's all done at the last minute. And maybe you could do that as well. You wait till she dies, you get a step up in cost basis. I don't know. It just seems to me that it's probably easy to have her move in. Um, she could move into the vacant house now anyway and maybe be prepared to pay for it and maybe just pay some rent right now and then maybe you can wait and see. Thankfully, she seems like she has the money she needs. So maybe what you should do is your youngest sister sells her house, moves into the current home, occupies the house, pays your mom some rent.

[A]

So that's very easy.

[B]

She doesn't have to do anything except pay rent, which would be paying the expenses. And you can make that situation, you can kind of keep that as the status quo for a while and see what happens next. This is from John, who says, my wife and I have spoken to a financial advisor whose compensation would be 1% of the portfolio, which comes to $6,000 right now. He looked at our investments. He says he can do better for us. Not wanting to waste your time listening to all of listing all of our investments. Is 1% customary? 1% is customary up to a couple million dollars. But if that person is not doing anything but managing your money, I wouldn't do it. If that person is a financial planner, then I might consider it. Okay, question from John. We've been getting this over and over again. So the question is, do you think it's possible that President Trump may want to take us into a recession and a lower stock market so others can buy at a lower price? Okay, so I'm 77 years old. I'm single, I have no bills. I've got $1.7 million. I was 1.8 a few weeks ago. Concerned. Look, if you're 77 years old, I'm not going to go into, like, the motives of what's going on at the administrative level. But if you have $1.7 million and you've got enough money in cash and bonds, then you can ride this out. If you have real concern, you can downgrade your risk profile, meaning that you can say, well, you know what, I'm actually not comfortable having so much money in the stock market and buy something different or have some cash. But don't switch back when markets change because they will change. So I would be a little bit less concerned with the motives. I'd be more concerned with how you actually want to manage your financial life. That's most important to me. So if you need more assistance, give us a Holler. Go to jillonmoney.com, click the contact us button. We'd be delighted to help you out. Don't forget, 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. Don't forget 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.

[A]

For decades, real estate has been a cornerstone of the world's largest portfolios. But it's also historically been complex, time consuming and expensive. But imagine if real estate investing was suddenly easyall the benefits of owning real, tangible assets without all the complexity and expense. That's the power of the Fundrise Flagship Real Estate Fund. Now you can invest in a $1.1 billion portfolio of real estate starting with as little as $10 4700 single family rental homes spread across the booming Sunbelt 3.3 million square feet of highly sought after industrial facilities. Thanks to the e commerce wave, the Flagship Fund is one of the largest of its kind, well diversified and managed by a team of professionals. And now it's available to you. Visit fundrise.com jillonmoney to explore the fund's full portfolio, check out historical returns and start investing in just minutes. Carefully consider the investment objectives, risks, charges and expenses of the Fundrise Flagship fund before investing. This and other information can be found in the Fund's [e-mail] Flagship this is a paid advertisement. Sometimes I wish I had a personal.

[B]

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[A]

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[B]

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[A]

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