Should I Pay Off My Mortgage Early or Invest?

Summary

Suze Orman's Women & Money: “Should I Pay Off My Mortgage Early or Invest?”

Date: March 26, 2026
Host: Suze Orman (with KT)

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Episode Overview

In this episode, Suze Orman and her co-host KT answer a mix of listener questions centering on homeownership, mortgages, and financial planning—especially the classic dilemma: Should you pay off your mortgage early, or invest extra money elsewhere? Along the way, Suze offers crucial insights into trusts, HELOCs, Medicare Advantage plans, Medicaid and long-term care, and how to avoid common mistakes in estate planning. With her signature blend of compassion and candor, Suze’s advice extends beyond numbers, emphasizing empowerment and long-term security.

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Key Discussion Points & Insights

1. HELOC Questions and Updates

• [00:02-02:27] Suze re-emphasizes her recommendation of the Alliant Credit Union Home Equity Line of Credit (HELOC), but clarifies that it is not available in all states (~80% coverage).
• [03:00] Can you get the Alliant HELOC on a secondary residence?
  • Suze: “Yes, my love, it is available for second residencies as long as you are the primary resident of that second home of yours.”
• [12:30] Should I complete transferring property into a trust before applying for a HELOC?
  • Suze: “First do your trust in all the paperwork so that when you go to take out the HELOC, it will be in the name of the trust, which is how it should be.”

2. Revocable Trusts: The Why and the Who

• [03:10] Quick recap: What should go in a revocable trust, and why?
  • Suze:
    • “Anytime you can put the name of a beneficiary on anything, like a life insurance policy, a retirement account, bank accounts that are pay on death, whatever it may be, they will pass immediately...without probate. Everything else—really a house and things like that—should probably be in a trust.”
    • “Stop thinking just about your beneficiaries. Start thinking about what happens if you become incapacitated.”
  • Suze plugs her “must-have documents” for $99 at musthavedocs.com.
• [14:22-17:53] Should a house be left via trust or just add spouse to the title?
  • Suze strongly critiques poor advice from a title clerk: “The less money you have, the more you need a trust. Because when all you have is a will, you are going to pay...for probate, this and that.” She explains the tax and asset protection benefits of a trust, emphasizing a step-up in cost basis and avoiding capital gains if the surviving spouse sells.
    • Memorable Suze moment: “That is the most stupid advice I have ever heard coming out of a more stupid title person. All right. Pisses me off.” ([15:44])
• [26:44-30:38] If most assets are in retirement accounts, do you still need a trust?
  • Suze: Retirement accounts pass easily via beneficiary, but even just owning a house warrants a living revocable trust—for probate avoidance and in case one spouse becomes incapacitated. She highlights that most powers of attorney become null upon incapacity; trusts don’t.

3. Mortgage Payoff vs. Investing: Michelle’s Dilemma

• [07:12-12:07]
  • Michelle, a 36-year-old military officer, has a $250,000 balance on a 2.25% VA home mortgage (30-year fixed) and wonders if she should put an extra $20,000/year toward the principal or invest it instead, while already making $100/mo extra payments.
  • Suze’s analysis:
    • If she puts $20,000 extra per year, the home will be paid off in about 8 years.
    • If invested instead (at 6–8% returns), she could have $200,000–$250,000 after 8 years; still owes ~$180,000 on her mortgage (if just making $100/mo extra payments).
    • Mortgage rates this low = NOT urgent to pay off; better to have options and flexibility, especially if she moves.
    • The mortgage payoff vs. investing is therefore “kind of even over that period of time,” but flexibility, potential returns, and liquidity argue for investing the extra, at least for now.
    • Revealing insight: Banks structure mortgages knowing owners mostly sell within 7 years, so most early payments go to interest.
    • Suze: “I don’t think I would pay it off right here and right now. I would give myself more time, especially at this interest rate.” ([10:58])

4. Medicare Advantage Plans

• [05:20-06:46] Suze addresses concerns about Medicare Advantage going away:
  • Some plans have been discontinued or become unprofitable; always research before committing.
  • Suze: “Medicare Advantage plans do not guarantee you that you are always going to be able to have that particular plan...But as things get rougher...yours may close down. You never know.”

5. Medicaid, Irrevocable Trusts & Aging Parents

• [18:24-21:29] Suze discusses the purpose (and limitations) of irrevocable trusts in Medicaid planning:
  • A five-year lookback still applies.
  • Don’t structure assets just to qualify for Medicaid; it often leads to lower quality care versus private-pay care.
  • “The goal is not to protect the money so we end up in a nursing home on Medicaid. Wrong.”
  • Prioritize the parent’s comfort and well-being over attempts to preserve inheritance through legal maneuvers.

6. Roth IRA Timing Rules

• [25:31-25:54] If I roll my Roth 401k into my Roth IRA, does the existing IRA age apply?
  • Suze: “Yes, it will. Remember your Roth 401k when you transfer it to a Roth IRA...It takes on the time limit of the Roth IRA.” So if your Roth IRA is 5+ years old, the rolled-over funds count as ‘seasoned.’

7. Suze’s Philosophy on Financial Products & Transparency

• [21:51-24:34] Suze affirms she doesn't want to profit off listeners, but guide them to the best value:
  • “I never want to make money off of you. All I want for you is to make money off of the advice that I give you.”
  • Tells stories of advising fans to buy her books at a discount elsewhere rather than pay full price at events/QVC—even if it made publishers angry.

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Notable Quotes & Memorable Moments

• On mortgage payoff:

  “I don’t think I would pay it off right here and right now. I would give myself more time, especially at this interest rate.” – Suze Orman ([10:58])

• On trusts for everyday people:

  “The less money you have, the more you need a trust...Is there a dollar amount that you can put on incapacity and taking care of one another?...That is the most stupid advice I have ever heard coming out of a more stupid title person. All right. Pisses me off.” – Suze Orman ([15:44])

• On prioritizing elder care over inheritance:

  “Really, our main priority is that money takes care of us, us when we’re older so our kids don’t have to take care of us...The goal is not to protect the money so we end up in a nursing home on Medicaid. Wrong.” – Suze Orman ([20:08])

• On financial products and her transparency:

  “I never want to make money off of you. All I want for you is to make money off of the advice that I give you.” – Suze Orman ([21:51])

• On beneficiaries and probate:

  “Anytime you can put the name of a beneficiary on anything...they will pass immediately to your beneficiaries without probate. Everything else really...should probably be in a trust.” – Suze Orman ([03:50])

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Key Segments & Timestamps

• 00:02 – HELOC intro; Alliant Credit Union details
• 03:10 – Revocable trusts: what to include, why incapacity care matters
• 05:20 – Medicare Advantage plans and precautions
• 07:12 – Michelle’s mortgage payoff vs. investing dilemma
• 12:30 – HELOC application vs. trust order of operations
• 14:22 – Should you add spouse to the house title or use a trust?
• 18:24 – Medicaid planning, irrevocable trusts, parental care priorities
• 21:51 – Suze’s philosophy on not profiting from her audience
• 25:31 – Roth IRA age and rollovers
• 26:44 – Should parents with only a house and retirement accounts get a trust?
• 30:38 – Wrap-up and sign-off

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Takeaways

• Don’t rush to pay off ultra-low-interest mortgages early; weigh flexibility and long-term returns.
• Use revocable trusts for homes and non-beneficiary accounts to avoid probate and protect against incapacity—especially vital if you have fewer assets, not just if you’re wealthy.
• Be skeptical of advice from non-experts (like title clerks) on legal/estate matters; consult true professionals.
• Don’t let desire to leave an inheritance undermine your own comfort and care in old age.
• Suze’s mission is clear: empower, not profit from, her listeners.

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For listeners: This episode is packed with actionable advice—especially around trusts, mortgages, and taking care of aging family. Suze’s energetic delivery and passionate corrections make the lessons memorable, even urgent, for anyone working toward financial security and family harmony.

Transcript

[A]

Hey Susie. Spring is in the air.

[B]

It most certainly is, my dear. And listen everybody, you should all spring into action if in fact you're looking for a home equity line of credit. If you have a home equity line of credit at a high interest rate, check out the Ultimate Opportunity Home Equity line of credit at Alliant Credit Union. Go to myalliant.com and look for all the details right there. March 26, 2026. Did you like that, KT?

[A]

Is it spring?

[B]

I don't know. Maybe.

[A]

Did spring happen?

[B]

That's very sad that we don't know. But, but we'll continue this.

[A]

I feel like it's. I feel like spring is in the air. Let's put it that way.

[B]

All right, welcome everybody to the Women in Money podcast as well as everybody smart enough to listen. Today is ask KTNSUSianything and if you have a question, you can write it into asksusie S u Zepodcastmail. Com. If KT chooses it. Oh, we will answer it on the podcast. Now just know sometimes we edit your emails, okay, because. Cause they're long, they have all this information that nobody else really cares about except for us. So just know that if you hear your email on this podcast. What do you want to say, Katie?

[A]

Well, I don't want to chitchat today because I have lots and lots of questions.

[B]

You always. But I love to chit chat with you.

[A]

She does it everyone. Not me, but these questions, I have many so I want to try to get through them.

[B]

But wait, first I want to say something to all of you about the HELOC that I Talked about from MyAlliant.com Life last Sunday. Tremendous response to it. However, it's not in all 50 states. They're able to offer it to about 80% of the population. If you go to myalliant.com right on the front page there, it will tell you all the states that the HELOC is available for. Listen, if it were up to them, they would have it in all states. But some states are very particular and they want more rules and regulations and so therefore they are not in those states. So sorry about that. All right, Katie.

[A]

Okay. And my first question happens to be regarding the Alliant Credit Union HELOC from Mike. He said thanks so much for the information. This looks like an incredible opportunity. And here's his question. I own two homes and I have significantly more equity in my secondary residence then my primary residence. Is the Alliant HELOC only available on primary residences or would My secondary residence qualify?

[B]

Yes, my love, it is available for second residencies as long as you are the primary resident of that second home of yours.

[A]

All right, KT okay, next question is from Alicia and Alicia asks Susie, will you give a quick recap on what should go into revocable trust and what can be left directly to the beneficiaries? Example, life insurance policies and bank accounts funded to the trust or left to the beneficiary. I want to make sure that my beneficiaries get whatever cash ASAP without having to deal with probate courts and wow, Alicia, good for you. And the reason I picked this, I love her subject quick and dirty recap on revocable trust.

[B]

I'm not sure anything is quick and dirty when it comes to a trust. However, here's the scoop. Anytime you can put the name of a beneficiary on anything, like a life insurance policy, a retirement account, bank accounts that are pay on death, whatever it may be, they will pass immediately to your beneficiaries without probate. Just that simple. Everything else really a house and things like that should probably be in a trust. However, I just want to say something. All of you, all of you have this in your mind. How do I get my assets to my beneficiaries without probate the fastest? You're not thinking about yourselves. Stop thinking just about your beneficiaries. Start thinking about what happens if you become incapacitated. What happens if all of a sudden you have a stroke, you're in an acc, you're ill, whatever it may be, who's going to pay your bills for you, who's going to write the check, whatever it may be. So a living revocable trust with an incapacity clause in it assigns who you are going to have take care of you when you can't take care of yourself. Just that simple. Which is why you want a living revocable trust. For those of you interested, you know the must have documents, $99, 2,500 worth. The state of the art documents. Good in all 50 states. Just go to musthavedocs.com and check it out. Next.

[A]

KT okay, this is from Greg. In your description of roadmap for 2026, you mentioned to be careful getting a Medicare Advantage account. Then you stated sooner or later they will no longer exist. Okay, now so Greg's questions are, Susie, how can we be careful getting a Medicare Advantage account? What makes you believe that all medic plans will no longer exist sooner or later?

[B]

Yeah. Now this is a person that I personally wrote back to you, just so you know. Here's why I think it because it's happened. Do I think that Medicare Advantages, all of them, are going to go away? No, I don't. But there are certain Medicare Advantage plans that have gone away. They've been shut down that people now don't know what to do and on and on and on. So Medicare, Medicare Advantage plans do not guarantee you that you are always going to be able to have that particular plan overall. Are they going to go away? No. But as things get rougher, as things get less profitable, whatever it may be, yours may close down. You never know. So check it out. Are they here to stay? How good are they? How good is your company? And so on and so forth. Next question. Katie.

[A]

This is one of my favorite questions of all, only because of the way she wrote it. This is from Michelle. She said, Hi, Susie and KT. My name is Michelle. I am a single 36 year old with a cattle dog named Ladybug.

[B]

Oh, you chose it simply because she was a doggy Ladybug. Because I used to call everybody. Oh, what else?

[A]

A love bug.

[B]

Oh, a love bug, that's right.

[A]

But we all love Ladybugs. But Michelle has been in active duty in the military for 11 years. Susie. Good on you, Michelle. And she said, my question is, does it make sense to pay my mortgage off early? I bought a home in August of 2020 for $285,000 using a VA loan, 291,500, including the VA funding fee at 2.25% for 30 years. The principal amount left on the home is $250,000.

[B]

Let me just get this right. 20, 26 years ago.

[A]

Yes.

[B]

She bought a home for really 285,000.

[A]

Yes.

[B]

Here we are six years later and all she owes on it is what?

[A]

250,000.

[B]

All right, got it. Okay.

[A]

And she, she got this at 2.25% for 30 years.

[B]

Okay.

[A]

Now here's what she's saying, Susie. It feels like it's taking forever to pay off my home. The principal has bar gone down. I've been making an extra hundred dollar payment each month against the principal. I know my interest rate is low and that the Cash plus is a higher interest rate than my mortgage rate. But I feel like you cannot put a price on being free from debt and owning your home outright. Because I'm living comfortably, I'd like to use my extra money from the Cash plus account to put extra payments toward the principal. And then she said, ready, Susie? This is the big question. I'm thinking of putting an extra $20,000 a year towards the mortgage. Is this a good idea?

[B]

Michelle Feilbell first of all, girlfriend, I used to call everybody love bug. All right? Will you ever forget when I was on Larry King and somebody called in and I looked in, I went, well, listen to me, love bug. And he just went, what, what, what? Anyway, all right, you are so young. Will you keep this home for the rest of your life? Maybe yes, maybe no. Things can happen over time. So if you think about it, you have to compare. What would you have if you took $20,000 a year and invested it for the same amount of time than if you put it to mortgage that the house would be paid off. Now, if you put $20,000 more per year towards your home right now, you're going to have it paid off in approximately eight years. Just that simple. Okay? If you took that $20,000 a year and you invested it for, let's say, the next eight years, maybe depending on your investment return, 6, 8%, whatever it may be, you would have $200,000 or $250,000. So it kind of comes out even over that period of time. If you just stay paying that $20,000 extra year, you're going to be mortgage free in 2034. That's pretty good if you ask me. However, if you just invest $20,000 a year for the next eight years, you've now invested it, you continue to put the $100 a month more towards your mortgage because it's at such a low interest rate. In eight years, you would probably only owe $180,000 on that mortgage. Then if you wanted to, you can decide do you want to take the money that you made investing pay off your mortgage or whatever. I don't think I would pay it off right here and right now. I would give myself more time, especially at this interest rate. You know, kt, I don't think people understand that when they buy a home and they take out a mortgage that the bank knows that most likely you're going to sell that house within seven years. That's on average. So therefore, 100% almost of every payment you make does what it goes towards the interest, not towards the mortgage. That's why at the ending years of a mortgage, it's all principal payments. Because the bank wants to know, if you sell your home in seven years, you still owe them almost everything you borrow, plus they made interest on it for the whole time. So mortgages aren't quite as lucrative as one might think, but in this particular case, I would invest that money, given just what I think she can do with it.

[A]

Yeah. And also she's so young.

[B]

She's young. So we'll see what she thinks eight years from now. And if eight years from now she decides, you know what, I'm going to keep the house forever, I like it here. Just take whatever you invested and pay off the mortgage and you're done.

[A]

Right. Okay, next is from Karen. Again, this is another HELOC question. Susie, I'm sure the answer to my question is simple, but I'm confused anyway.

[B]

All right, here's your answer. Simple, simple.

[A]

Wait, you're not the only one, Karen. I'm in the process of filing a quit claim to move my property into a trust, but I want to take advantage of the alliant HELOC opportunity. Should I wait to apply for the HELOC until all of the property and trust paperwork and is complete?

[B]

Good question, girlfriend. And the answer to that is first do your trust in all the paperwork so that when you go to take out the heloc, it will be in the name of the trust, which is how it should be. So do the transference first for the trust and everything and then do the HELOC HELOC opportunity. Everybody is not going to go away for some time.

[A]

All right, great. Okay, next question is for Stacy and this is again a great subject line. Susie, thanks for changing my life for the better. I love that.

[B]

I like when can you say that?

[A]

Susie, thanks for changing my. Oh, me say it to you?

[B]

Yeah.

[A]

Oh, Susie. Oh, you are my Jackpot.

[B]

Jackpot.

[A]

Goodness. Our life has been changed not only for the better, but for the unbelievable. Okay, this is she said. Hi, Susie and kt. Thank you for changing my life and helping me to become financially secure. My question is, my wife and I have been together for 20 years and married seven. We are both 58 years old. We are currently living in a house that's owned by my wife. She bought it before we got together and has paid it off over the years on her own. After listening to your podcast, I've been encouraging her to set up a trust and put the house in a trust rather than just leaving it to me in her will.

[B]

That's smart.

[A]

Well, wait. She's fine with the idea and has done her must have document trust. However, when this is the part that makes you're going to get. Watch Susie's face everyone. If you can imagine what this is going to do. However, when she called the title company to inquire about changing the title. They advised her that she did not need a trust because we are not wealthy people and she should just add my name to the title of the house. She is very willing to do this. However, I am not sure which is best for her. I have not contributed directly to her paying off the house. What do you think is best for her and why? I know Susie has an expression on her face that looks like if she was sitting across from the title company person giving this advice, she would strangle them. Am I right?

[B]

Well, here's the thing. What expertise does possibly a clerk who works for the title company who simply fills out, you know, paperwork and does what the hell do they know about the wealth that these people have, the deeds that these people have. If these people are healthy or not, what the hell does that person know?

[A]

And it's insulting.

[B]

Well, besides that. No. I have a saying. The less money you have, the more you need a trust. Because when all you have is a will, you are going to pay. And if you don't have a lot of money, you're going to have to pay for probate, this and that. Next. Why transfer the name into joint tenancy? Why would you do that? And the reason that I say that is this. All right, now your name is on the house. Now she's gifted you half the value of the house, the value of when she bought it. Why would you not want to just inherit it? So you actually get a step up in basis. If she bought that house for $50,000, let's just say she did. And it's now worth $500,000 just in her name. You have a living revocable trust where it's held for her benefit while she's alive, your benefit. After she has died, she dies. Now it goes directly to you, no probate. Two weeks later it's yours. But you also now get a step up in basis. So now your cost basis on that house is $500,000. If you can't live there anymore, too many memories, whatever, you turn around and sell it. Guess what? You don't pay any capital gains tax whatsoever. Are you kidding me? And I can go on and on and on about absolutely should be in a living revocable trust with the must have documents. Given that she already has them just held in her name, you should be the successor trustee of the trust. So if she becomes incapacitated, if something happens to her, then you simply take over as the trustee and then you can manage everything for her. But that is the most stupid advice I have Ever heard coming out of a more stupid title person? All right. Pisses me off.

[A]

Just to cool down for a moment, we're going to take a pause.

[B]

Does anybody realize that the damage that's done from people who don't know yet, they think they know you're not wealthy enough for a trust? Like, what the hell is that about? Like, is there a dollar amount that you can put on and incapacity and taking care of one another and on and on and on? Really, everybody? Anyway, go on, kt. Just go on.

[A]

Well, here's another trust question. This is from Rebecca and she said, you've helped me before and I'm hoping you can help me. As a person is preparing for Medicaid, can you explain if they should create an irrevocable trust? My parents are aging and trust me to guide them because I listen to you and have listened to you for years. So there's a smart person writing in. She said, my mom and I used your must have documents for mom's funded revocable trust. However, I'm concerned that her trust may impact the Medicaid eligibility. What should we do?

[B]

Yeah, it's not the trust that impacts it. It's the amount of money that you have. And so a lot of you think that if you just did an irrevocable trust, then it's out of your mom's name, then she'll qualify for Medicaid because that's just what you're all thinking for some reason. So I want you to go back. I think it's either last week or the week before I did a big answer to this particular question. Even if you change everything now, just so you know, to an irrevocable trust, it still will have a five year look back. But here is the bottom line again. Do you really want to deplete all your mother's money just so she could be on Medicaid? Which means she doesn't have any money. So now the state, everybody pays for her. Do you have any idea of the care in a Medicaid nursing home when you're on Medicaid versus a private care patient? Do me a favor. Go back one or two, ask KT and Susie anythings right. And you'll hear the answer to that question.

[A]

Ugh.

[B]

Again. Okay, well, here's kt. Here's the thing. Seriously. I get that people want to protect their money because they don't want to waste it going into a nursing home and doing all these things. I get that sometimes the kids want their parents to protect the money so that they have money. That's what the money of the parents are there for. It's not just there so that the kids get to inherit money. All of us have money. Really. Our main priority is that money takes care of us, us when we're older so our kids don't have to take care of us so that we can have help. We can have aids. We can, if we have to go into a nursing home, go into a nursing home with nice care. Are we able to buy long term care insurance or whatever it may be, but the goal is not to protect the money. So we end up in a nursing home on Medicaid. Wrong. Now, if you don't have any money, and that's true, okay, but when it's not true, don't hide money just to have money. Anyway, go on. This has not been a good podcast.

[A]

I didn't mean to aggravate you, but okay, here.

[B]

You know what? It doesn't aggravate me, kt. It hurts me.

[A]

I know. Especially what hurts her the most is when you're all getting the wrong advice or you're getting advice from people that are basically stupid or people who want

[B]

to make money off of you or

[A]

they, they're doing it for their gain, not yours.

[B]

Listen, I never want to make money off of you. All I want for you is to make money off of the advice that I give you. It's just that simple. You know what, we're going to go off track here for a second, kt. Okay, so the other day we're talking about how mad I used to make the publishers when I would give a talk. So normally what would happen is I would go and give a talk. And when I gave a talk, a few thousand people would come, especially if I was doing a book signing and I would sign books after my talk. All right. And normally a major bookseller would come there and sell the books to everybody. But when a major bookseller goes to somebody and authors talk, they sell the book at full price. $28 at the time, I think it was. What would I do, Katie?

[A]

Susie would, Susie would be thrilled to sign the book for people, but she'd say, listen, they're selling the books outside, but they're full cover price. If you want to save money, go to Amazon. Or she would tell, she would steer them to a place where her book was being sold for a significantly less,

[B]

usually like 10 to $12 cheaper. And I would say, really? My signature in the book isn't that important. Just stand in line and I'LL sign a little bookmark for you, something that you can put in your book and save the money.

[A]

Can I tell them a great greater example than that?

[B]

What? Tell me.

[A]

Oh, my goodness. On qvc, Susie would be educating everyone about the must have documents. And there was the must have document kit that she would be selling. And she'd get a phone call. She'd get live, they called it T calls. Telephone calls would come in live to the show and Susie would get a call and the viewer would say, susie, I'm so proud. I just bought the kit and five more for my K. And Susie would say, wait, wait, wait. What did you just say? I bought your kit and I bought five more for my kids. Susie would say, okay, stop. And she'd say to the producer, get this woman's name. I want you to keep yours and return all the others. And they would say, why? Because mine is shareware. You do not need to buy one for every person in your family. You can share it with everyone. And then she'd say, and if you go to church Sunday, share it with the whole church. So it was, it was fun for her to do that. And then I'd get the phone call in the green room. What is Susie doing?

[B]

Right? But one thing, I just want you to be aware of everybody. I would go on QVC and HSN because I went on there because there was something that I wanted you all to buy at a price that you couldn't get anywhere else, number one. But number two, why else would you be watching QVC or HSN if it wasn't to buy something? So I was there knowing that I was selling something when I was on the Today show, when I was on my own show, when I was at a book signing, when I was at a talk, I never allowed any product to be mentioned and or sold to you at that point in time. Sure, I could do an interview about the book and everything, but it wasn't a direct sell on it. On it. So just know that again, I don't want to make money off of you. I want you to make money off of my advice. All right, kt.

[A]

Okay, next question. Again, please help Roth confusion. Whenever I see these questions, I relate. So. Hi, Susie and KT. My Roth IRA was set up more than 5 years ago. And if I roll my Roth 401k into my Roth IRA IRA, will it be treated as the 5 plus year old account?

[B]

Yes, it will. It will. All right, remember your Roth 401k when you transfer it to a Roth IRA. No, taxes or anything. It takes on the time limit of the Roth IRA. So even if you had a Roth 401 or 403 or TSP that had been open 10 years and you had a Roth IRA that had only been open one year, it would take on the one year time limit of the Roth IRA.

[A]

This is from Charles. My last question. Hi Susie. As I listened to you and KT recently I've been wondering about my parents plans. I am the executor of their wills and also have access to their power of attorney and their living wills.

[B]

I already know where this is going. Go on.

[A]

I asked them about a living revocable trust and they told me they had no need for one. They say the bulk of their money is in retirement accounts and the only property they own is the house they live in. The only reason I could think of was in case one of them was not competent to make decisions. They seem to think the power of attorney would help in that situation. Can you explain to me the reason that they need a trust so I can explain to them Mama and Papa,

[B]

while it is true that most of your assets are in a retirement account and for there it should be, each spouse should be the primary beneficiary of the other one's retirement account and the contingent beneficiary should be the kids or whoever you want them to be. No problem there. But the house, the house. Number one, why would you want the house to have to go through probate for your beneficiary? Probate is a court procedure. Depending where you live it could be six months, one year, two years. It is expensive. Statutory fees in many cases to the lawyer and the executor and on and on and on. Number one, why would you want that? Oh you think it's not going to be a big deal? It is a big deal. Trust me on that. So number one, if nothing else, you had nothing else other than this house. Your retirement accounts are fine. Okay? So here you have your home. Both of you own it. However you own it, fine. And you're leaving it to whoever via a will. But while you're living in it, one of you becomes incapacitated and the other one needs to sell the house. Because maybe it's two stories and you have to go to a one story house. The question is can they sell it? And the answer to that question is no, they cannot. Because if you own it in both your names, it takes both signatures to be able to sell it. So what's going to have to happen? One of you, whoever is incapacitated, gets declared incompetent, they get a conservatorship for that person and from that point on, they have to continuously report back about what's happening with that half of the money. Oh, you say that's not a problem because you have a power of attorney. Do you know that most power of attorneys become null and void the day that there's an incapacity? You become incapacitated and you have an account just in your name and somebody says, I'm power of attorney, I want to take money out of this person's account. The bank isn't going to let that happen because you can revoke a power of attorney anytime you want. And the bank is going to be afraid that maybe you revoked it. So it's going to be a whole mess there. When you have a living revocable trust with an incapacity clause in it, which requires a doctor to say, yes, this person's incapacitated and then a successor trustee immediately steps in, the bank usually has a copy of your trust so they know that's true. So it becomes very easy for you. There is absolutely no downside whatsoever for you to have a living revocable trust. So I gotta tell you, your parents should listen to this particular podcast and if you want, go to musthavedocs.com they're $99 for $2,500 worth. The state of the art documents. I said it before, but I'm going to say it again. Good. In all 50 states. Are you kidding me? All right, KT, is that really it?

[A]

That is it. That is a lot.

[B]

That went fast, huh?

[A]

Yes.

[B]

And on Sunday, everybody, after we do the podcast. And by the way, Fitzy is going to be on again on Sunday since all of you love him so and since he has guided us correctly. Has he not? The two of us make such a dynamic duo. However, right after that, guess what?

[A]

We're going to New York City.

[B]

We're going to New York City. And we'll be there four days, but we will be back in time to do another. Ask KT and Susie. Anything for you. We wouldn't leave you in the lurch. But until then, there's only one thing that we want you to remember when it comes to your money. And what is it, kt?

[A]

It is people first than money than things.

[B]

Now you stay safe. Bye bye now.

[C]

We are strong, we are wise. We will not apologize. We are here, we will thrive Together we will rise. We're the little bit of faith and everything it takes, we are strong, we are wise. Together we will rise.

[B]

Hi everybody, Suzy O here and I have to tell all of you there is one benefit that I know all of you need and your corporations need to offer and it comes from a company that I helped co found over five years ago by the name of Secure Safe. So whether you're an employee or an employer, I want you to go to securesave.com Suzy S U Z E and take a look at what I have for you there. I promise you you're gonna like it.

[D]

All right now, neither Suze Orman Media nor Suze Orman is acting as a Certified Financial Planner Advisor, a Certified Financial Analyst, an economist, CPA accountant or lawyer. Neither Suze Orman Media nor Suze Orman make any recommendations as to any specific securities or investments. All content contained in this podcast is for informational and general purposes only and does not constitute financial accounting or legal advice. You should consult your own tax, legal and financial advisors regarding your particular situation. Neither Suze Orman Media nor Suze Orman accepts any responsibility for any losses which may arise from accessing or reliance on information in this podcast and to the fullest extent permitted by law, we exclude all liability for loss damages, direct or indirect, arising from the use of this information. The must have documents discussed in this podcast are legal documents created by a lawyer and distributed by Hay House. Thanks for listening.