A (2:55)

Hi Mona, how are you?

C (2:57)

Hello, I'm great, thank you.

A (3:00)

Excellent. What brings you to us? What can we do for you?

C (3:03)

Well, I have some questions about what I should do with some of my finances.

A (3:10)

Okay, tell us about yourself. How old are you?

C (3:12)

So I currently am 57.

A (3:15)

Okay. Do you still work, Mona?

C (3:17)

Yes, I do. I work full time and I teach at a local college and then I also teach a couple classes part time.

A (3:28)

Wow. Do you like it? Is it a fun job to have? Have you been doing it a long time?

C (3:33)

Yes, I love it. I love working with the students. I'm not so keen always on the administrative side of things, but I love teaching. I love seeing people, whether they're tradition traditional age students or returning students in terms of adults or career changers, just sort of blossom and find their way into a, into careers and life, life journeys.

A (3:55)

That's so nice. How much do you earn as both teaching at this college and the adjunct stuff?

C (4:01)

Sure. Total income is about. Well I earn about 100,000 at my full time position and about 25 part time.

A (4:11)

And is that a good chunk of money for you? Is that covering your needs?

C (4:15)

Yes.

A (4:16)

Okay, great. And do you contribute to a retirement account through work?

C (4:21)

I do. I have a 403 at my full time position and then I've been contribute contributing to A457 at my part time.

A (4:31)

Okay. How much money is going in? So you're making 125. How much goes into each of those plans?

C (4:38)

Well, currently and I, I did it with dollars, not percentages, but I can. Okay. Currently at the full time position it's about 850 per pay period. You know, so times 24 times per year and 350 at the part time and. But that one is more just when I'm teaching. So it's extracted. So if I'm not teaching or being paid, then that's not taken out.

A (5:04)

Okay, but that's good. Right now in the bigger plan where you're putting 850 per pay period, how much is in there?

C (5:14)

About 600,000.

A (5:16)

600,000 is great money. And what about in the 457? How much is in there?

C (5:22)

It's about 50,000. I haven't been doing that very long.

A (5:25)

Don't be sheepish. This is good. And how much in other stuff? So let's do the easy stuff. How about money in the bank?

C (5:34)

Sure. Currently, I have about. In terms of cash, I have about 250,000.

A (5:42)

Holy smokes. What's that? Just like you just had. Does that give you comfort? Did you hit some portion of the lottery? What's with the 250? That's a big number.

C (5:55)

It is. I've always been rather heavy in cash, but. So about 100 of that was there. But I was lucky enough to have a friend of mine give me a lump sum of money.

A (6:08)

Wow, that's good. Okay, so 250 in there now? Normally it's 100, but that's good. And do you have any other investment accounts or any other holdings that we should know about?

C (6:19)

I do. In one brokerage account, I have 150. And in a second brokerage account, I have 1 million, 25 million.

A (6:28)

Oh, my God, Mark, this is like, hello. 1.25 million in a brokerage account. Oh, my God. That's unbelievable, girl.

C (6:39)

And I have about 250,000 of IRA BDAs that I need to know what to do with. I, R A B D, the beneficiary distribution account.

A (6:53)

How much money do you actually need to live on? Because you're putting away a lot of money right now, and it appears just from, like, the way you're saving, it would appear to me that of the 125 grand or so that you make, you're probably. Probably only living on, what, 70 or 80 a year?

C (7:11)

Probably closer to about a hundred thousand total, I would say, just because I have a expensive hobby.

A (7:19)

Oh, all right. I love expensive hobbies. Okay, so $100,000 a year is your need. Now, through either of these jobs, will you be entitled to a pension?

C (7:31)

No.

A (7:32)

How much longer do you think you want to work?

C (7:34)

So your book, the Great Money Reset. I'm okay to keep. I like to work. I like what I do. But I also know that life is short, so I, you know, I don't. I'm fine to keep working forever and ever, but I also know that there's a big world out there, so I don't really know the answer to that question.

A (7:55)

Okay, that's fair enough.

B (7:57)

That's good.

A (7:58)

Now, Mona, are you single? Are you partnered? Are you married? What? Is there someone else in this picture?

C (8:04)

I do have A partner.

B (8:06)

Okay.

A (8:06)

And does your partner earn money or are you the main wage earner?

C (8:10)

No, my partner also earns money and is employed full time.

A (8:15)

Okay. Do you keep your money separate or should we, like, incorporate partner's stuff in this picture?

C (8:21)

You can incorporate.

A (8:22)

How much does partner earn?

C (8:24)

About 85.

A (8:26)

Okay. And savings for the partner is included.

C (8:31)

That's what I. That was the amount I gave you? That's the total.

A (8:34)

Okay, gotcha. Okay, perfect. And same age? Ish.

C (8:38)

Yes.

A (8:39)

Okay, so you guys make a bunch of money. You save a bunch of money. You have a bunch of money. Do you have a home?

C (8:45)

Yes.

A (8:46)

How much is that home worth?

C (8:47)

I think it's about 630. Do you have a mortgage? Yeah, about 300.

A (8:53)

Do you know the rate on the mortgage?

C (8:55)

Because I refinanced right at the start of the pandemic at like, 2.6.

A (9:00)

Come on. Right. Unbelievable. So what's the genesis of this call? Like, what is it that you think you need that you're not doing? Because you seem to be in fantastic shape.

C (9:11)

Well, thank you. Because my call is premised more on. More on what I should be doing right now in terms of, like, for example, should I fund a Roth ira? Does it matter? Should I, for the ira bda, should I take the required minimum distribution per year over 10 years or when my income dips?

A (9:36)

Yeah, I get that. So, I mean, if you're the beneficiary of a retirement account and the rules have changed now. Right. So generally, here's how, like, the game plan would work. As I see it, if you said to me, jill, you know what I want to work. Like, ideally, what do you really feel like you want to? Like, could you say, I want five more years and see how the numbers look? Would that be fair for us to look at?

C (9:58)

That's reasonable.

A (9:58)

Okay. So you work for five more years, everything's cool. From the time you are 62 until age 70, then that will be a time period where we will want to pull money out of that IRA account. The beneficiary one. That's the $250,000 one. Right, right.

B (10:17)

Okay.

A (10:18)

So then you basically have eight years to get that money out. Let's call it seven years, maybe. So you make sure that you do it before you turn age 70, because you're going to have income of Social Security when you're 70, right? Right. Do you happen to know what your Social Security benefit will be at 70?

C (10:36)

I do, because I listen to you, and I know you're going to ask 4,000.

A (10:42)

And what about your partner, 3,200. Wow. So if we can get you guys to age 70, you're kind of living large, right? I mean, truly. So we have the next five, or let's say five years where you're still making 100 grand and 25. I don't think you need to put more money in your retirement account, by the way. I mean, I really don't. I do think that what you can do is, you know, if you need extra money between the two of you, if there's some extra money you need, you could pull some money out of your cash, obviously, and use that. If you need to go on like some big awesome trip or you're doing something big beyond that, I would just keep stockpiling some cash. And then you retire and then you pull money out of that IRA bda, That's a portion of it. Even if we just said you did 50 grand a year from that for five years, let's say. Okay, and then you're going to use some of the money that is in the bank, slash brokerage to fund whatever else you need until you're age 70. That's really what you're going to do. That means, though, we have to be clear, if you need $100,000, let's say together, you guys need 100 grand A, and we know you're going to have 50 of that will be pre tax from the beneficiary IRA, you'll have to come up with, let's say, another 60 or 70 grand somewhere. And that would be cash brokerage. Right. And you just live on that until you're age 70. And then once you guys claim Social Security, you don't need that much more money.

C (12:16)

If you pull 3% out of 1 million, like you said to your viewers a couple of times before, can you do that forever or only for 30 years? So it's because it's constantly okay.

A (12:29)

You could do it every year. It's just that what happens is the 3% may not cover what you need. Right? I mean, it's sort of like a safe way to hopefully not run out, but that. Yeah, but you don't have to just do that from the brokerage. You'll have your 401, 403B and your 457 also. You have plenty of money. Honest to God, you have plenty of money. What's going to happen is if we get rid of this ira, the beneficiary ira, before you start claiming Social Security, you will then have to start taking money out of your retirement account. You'll have to do that. That'll be your required minimum distribution. Right?

C (13:05)

Right. Whether it's Roth or.

B (13:09)

Yeah, no, Roth. You don't have to make it.

A (13:11)

The thing is, if we convert you

B (13:13)

to a Roth, then I gotta burn up your cash. And you like your cash.

A (13:16)

I already know this.

B (13:16)

Cause you've said that.

A (13:17)

You're like, I like my cash. Right. And so if we were to do a conversion, it sort of makes more sense financially, but really doesn't matter that much for you. It just doesn't. Today, if you were receiving $24,000 in a required minimum distribution, you were receiving the two Social Security checks totaling $7,200 a month.

B (13:44)

You probably are pretty close to meeting your needs.

A (13:47)

You could essentially live off your RMDs and your Social Security and dip into your money whenever you need. A little fun time, a little something in the house or, you know, whatever it is. And you're good. You're good. What's your opinion about. Or your feeling about risk? Like, when we look at that brokerage account or in your 403, are you risk averse? Are you fine with risk?

C (14:12)

I love risk.

A (14:13)

No way.

C (14:14)

Yeah, I'm totally.

A (14:15)

I'm totally.

C (14:17)

Yeah, no, my. No. Heavily. Yeah, I love. I'm very. I'm very comfortable with risk, which is actually a problem given my age. But I have it in basically the S P and then some small cap value and then some individual stocks, which I know I shouldn't have it in the individual ones. And that's okay.

A (14:37)

I mean, if you don't have a lot in the individual, it's fine. But it's totally fine.

B (14:41)

Mona, you're a player.

A (14:43)

So at this point, because you are heavily invested and you are a risky investor, I am inclined to keep that cash that you have. You know, you said you had 100, but now you have 250. I'm inclined to just keep that cash on hand.

C (15:00)

Okay, I agree. I feel comfortable with that.

A (15:03)

I love this. I am so blown away. I'm so happy about this. I do you feel like at this point, before you came on the air, you said you were nervous, but, like, isn't this totally awesome? Like, you're in great shape. Imagine if you had to come on the air and I was, like, crushing all of your dreams. It would be terrible. You're in such good shape. What were you ever worried about?

C (15:24)

It is totally awesome because I think, you know, you spend your whole life working and saving and trying to invest where you can, and then you have something, and then you know, I sort of. Yeah. What do I do? So this helps me to sort of calm down, to see what's possible. So thank you for that.

A (15:44)

Here's what I can tell you. What I can tell you, Mona, is you can do whatever you want. You are in such good shape. Are you and your partner. Are you married? Are you officially married or not?

C (15:53)

No.

A (15:53)

Okay. Do you have estate planning done?

C (15:56)

We had a trust put together.

A (15:59)

Good.

B (15:59)

If you need some guidance, some cheerleading, some coaching, or just an unbiased third party to help you weigh a financial decision, go to our website, jillonmoney.com, click the contact Us button, write us a note, and if you'd like to join us live, check the box. Mark will do everything else you can subscribe to us on the Odyssey app or wherever you find your favorite podcast. If you wouldn't mind, please leave us a rating and review. Wherever you you listen, of course, we always ask that you try to lift someone up. Change your work, change your wealth, change your life. Thanks for listening. We'll talk to you tomorrow. Hey, gang. Now you know that we have not yet gotten into the merch business full time, but I was thinking about how easy it could be after I created these beautiful pullovers at vistaprint. I chose a pullover, but boy, the options are incredible.

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