Podcast Summary: Suze Orman's Women & Money (And Everyone Smart Enough To Listen)

Episode: Ask KT & Suze Anything: Throwing Money At a Problem Does Not Always Solve It
Release Date: June 29, 2025
Host: Suze Orman Media
Duration: Approximately 32 minutes

In this engaging episode of Women & Money, Suze Orman teams up with KT to address a series of listener-submitted questions, offering expert financial advice and insights. The episode delves into various aspects of personal finance, including savings strategies, retirement planning, legal preparations, and family financial dynamics. Below is a detailed summary of the key discussions and advice provided.

1. Gloria's Savings Account vs. Home Equity Line of Credit

Listener: Gloria
Timestamp: [02:48 - 04:20]

Question: Gloria has an $88,000 savings account yielding an alleged 3.75% monthly interest and a home equity line of credit (HELOC) with a $43,000 balance, incurring $500 monthly charges. She seeks advice on whether to withdraw from her savings to pay off the HELOC.

Suze's Response: Suze immediately identifies a discrepancy in Gloria's claim of a 3.75% monthly interest rate, clarifying that such a rate would equate to a staggering 45% annual interest, which is highly improbable. Suze advises:

"Gloria, it is impossible that you are making 3.75% monthly on your $88,000. That would mean that you are being paid 45% a year in interest." [03:23]

She recommends utilizing the savings to eliminate the HELOC debt, emphasizing the benefits of reducing high-interest liabilities to strengthen financial security.

2. Jeff's Dilemma: Rolling Over 401(k) to a Financial Advisor

Listeners: Jeff and his spouse
Timestamp: [04:20 - 09:22]

Question: Jeff retired early at 57 and holds both traditional and Roth 401(k)s. His financial advisor suggests rolling over these accounts to his firm, Morgan Stanley, citing concerns from the 2008 financial downturn. Jeff is hesitant about consolidating his retirement funds due to potential loss of accessibility and increased fees.

Suze's Response: Suze outlines the implications of rolling over the 401(k):

"There is a rule called 72T that if you leave service in the year that you turn 55 or later, you access any money you want in your 401k without any penalties whatsoever." [05:52]

She cautions that rolling over the accounts could restrict access until 59½, complicate tax strategies, and potentially negate existing benefits like the Roth IRA's five-year rule. Suze advises evaluating whether the financial advisor's management could outperform the current 401(k) growth to justify additional fees. She suggests maintaining flexibility by possibly keeping a portion of the funds in the 401(k) to avoid penalties and maintain financial agility.

3. Sherry's Concerns: Securing Final Documents Against Disasters

Listener: Sherry
Timestamp: [09:22 - 13:05]

Question: Sherry is in the process of creating essential legal documents (will, trust, etc.) and seeks recommendations on safely storing them to prevent loss from natural disasters like hurricanes, fires, or floods. She also inquires about the validity of sharing duplicates with family members.

Suze's Response: Suze emphasizes the importance of safeguarding original documents while ensuring authorized individuals can access them when needed:

"I would keep them at home in a fireproof and waterproof box." [10:15]

She acknowledges the limitations of safety deposit boxes, such as potential inaccessibility during disasters, and recommends alternative secure storage solutions like personal waterproof, fireproof safes or distributing copies to trusted family members. Suze underscores that only original documents are legally valid, but having duplicates can facilitate timely access during emergencies.

Additionally, she promotes Must Have Documents, a service offering comprehensive legal document packages:

"If you want to get the must have docs, go to musthavedocs.com and that's where you get them. Currently, they are $99 for $2,500 worth of state of the art documents." [12:33]

4. Janelle and Patrick's Inquiry: Qualified Longevity Annuity Contracts (QLACs) and RMDs

Listeners: Janelle and Patrick
Timestamp: [13:05 - 16:30]

Question: As a 65-year-old couple, they are exploring the use of QLACs as a tax strategy to defer Required Minimum Distributions (RMDs) until age 85. They are concerned about their future income potentially exceeding Medicare's Income-Related Monthly Adjustment Amount (IRMAA) brackets.

Suze's Response: Suze expresses skepticism about the effectiveness of QLACs for their situation:

"I just don't think it's worth it, to tell you the truth." [16:09]

She highlights that transferring funds to a QLAC would lock away up to $200,000 per person without indexing for inflation, thereby limiting flexibility. Suze questions whether the potential tax benefits outweigh the loss of access to principal:

"What concerns me is you say currently you don't need your RMDs..." [14:21]

Instead, she suggests considering a Roth IRA conversion, allowing them to manage taxable income more effectively without the restrictions imposed by QLACs.

5. Lori's Planning: Trusts and Retirement Accounts for a Divorced Mother

Listener: Lori
Timestamp: [16:30 - 20:20]

Question: Lori, a divorced mother of two, seeks advice on establishing a trust to protect her retirement accounts and pensions, ensuring they benefit her children without complications.

Suze's Response: Suze clarifies the limitations of incorporating certain retirement accounts into trusts:

"It's an individual that owns that retirement account. So given an individual cannot be a trust, it cannot be in a trust." [18:35]

She explains that IRAs, Roth IRAs, pensions, and tax-deferred annuities must remain in the account holder's name and cannot be owned by a trust. However, she offers strategies for naming beneficiaries directly:

"You can...name your children as long as they're like over 18 or 19 or they're responsible with money as the beneficiaries of that TDA and then it will go to them directly." [19:01]

Suze advises leveraging beneficiary designations to ensure assets pass directly to children, simplifying the transfer process and avoiding probate.

6. Laura's Family Financial Dynamics Post-Divorce

Listener: Laura
Timestamp: [20:20 - 28:46]

Question: Laura describes a complex family situation where her sister-in-law, at 72, is financially strained after a divorce, depleting her retirement savings to support her son’s failed day trading venture. The family's support funds ($1,000 monthly) are causing strain, as Laura feels it enables her brother’s affluent lifestyle, leading to tensions in relationships.

Suze's Response: Suze breaks down Laura's concerns into two main issues: her husband's approach to the situation and the family's financial dynamics.

1. Understanding Different Relationships:

   • Suze points out the difference in emotional connections between spouses and in-laws, explaining that Laura might feel closer to her sister-in-law than her husband does.

2. Addressing the Brother's Financial Choices:

   • She advises Laura to communicate openly with her brother about how his financial decisions are impacting the family and to engage him in finding solutions that support his ex-wife without undermining his own financial well-being.

3. Supporting the Sister-in-Law:

   • Suze encourages involving Laura's son to understand his current financial situation and explore ways he can contribute to his mother's support, thereby reducing the financial burden on the rest of the family.

"You should sit down and talk with your brother...and also with the son to understand their roles and contributions." [22:37]

She emphasizes the importance of setting boundaries and ensuring that support does not become enabling, which can lead to further family strain.

Conclusion and Closing Remarks

Towards the end of the episode, Suze and KT discuss potential changes to the podcast format, including the introduction of "Sunday Chats with KT," aimed at fostering more intimate and focused financial conversations. They also highlight the upcoming special on July 2nd, encouraging listeners to tune in for valuable financial insights and surprises.

Suze reiterates the importance of financial preparedness and invites listeners to explore secure savings options through partnerships like Alliant Credit Union, emphasizing:

"People first, then money then things." [31:11]

This episode provides a comprehensive look into managing personal finances through practical advice, highlighting the nuanced balance between saving, investing, and supporting family members without compromising financial stability.

Notable Quotes:

• Suze Orman: "Gloria, it is impossible that you are making 3.75% monthly on your $88,000. That would mean that you are being paid 45% a year in interest." [03:23]

• Suze Orman: "There is a rule called 72T that if you leave service in the year that you turn 55 or later, you access any money you want in your 401k without any penalties whatsoever." [05:52]

• Suze Orman: "I would keep them at home in a fireproof and waterproof box." [10:15]

• Suze Orman: "I just don't think it's worth it, to tell you the truth." [16:09]

• Suze Orman: "It's an individual that owns that retirement account. So given an individual cannot be a trust, it cannot be in a trust." [18:35]

• Suze Orman: "You should sit down and talk with your brother...and also with the son to understand their roles and contributions." [22:37]

• Suze Orman: "People first, then money then things." [31:11]

This episode underscores Suze Orman's commitment to empowering listeners with practical financial knowledge, addressing real-life scenarios with clarity and empathy.