What The New Law Means For Your Roth IRA! - 545

Summary

Podcast Summary: Your Money, Your Wealth

Episode 545: What The New Law Means For Your Roth IRA!

Hosts: Joe Anderson, CFP® & Alan (Big Al) Clopine, CPA
Date: September 2, 2025
Duration: Approx. 36 minutes

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Overview

In this episode, Joe and Big Al break down the implications of the recently passed "One Big Beautiful Bill" on Roth IRAs, Roth conversions, and general personal finance strategies. The episode features their classic humor and banter as they clarify listener questions, analyze trending financial strategies, and review how the new law changes the tax landscape for retirement savers. Additional topics include tips for optimizing financial freedom, the ongoing debate about permanent life insurance strategies, and reflective listener feedback.

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Main Discussion Points and Insights

1. The New “Beautiful Badass” Tax Bill and Roth Conversion Strategies

[01:03–08:46]

• Lower Tax Rates Extended "Permanently":

  • The individual tax brackets (10, 12, 22, 24, 32, 35, 37%) are now extended indefinitely, barring future congressional action.

    “Permanent means whenever they change it again.” — Joe Anderson [02:03]

  • Opportunities: Still a strong case for Roth conversions in the 10–24% brackets, which have been slightly broadened for inflation.

• Inflation Adjustment for Brackets:

  • Lower brackets are now indexed for inflation, creating slightly more headroom for conversions.

• SALT Deduction Increase:

  • The state and local tax (SALT) deduction cap jumps from $10,000 to $40,000, phasing out above $250,000 (single) or $500,000 (married).

    “That would be a huge benefit…particularly those that live in California and other high tax states.” — Big Al [03:26]

• Senior Tax Credit:

  • Additional $6,000 deduction for those over 65 and/or blind, phasing out starting at $75,000 (single) or $150,000 (married) MAGI.

• Other Key Extensions:

  • High standard deduction, child tax credit, corporate/individual lower rates, estate tax exemption up to $15 million, and QBI deduction continue.

• New Deductions and Credits:

  • Tips: Up to $25,000/year tax-free (phases out above $150,000 income, 2025–2028).
  • Overtime: Up to $12,500/year tax-free (same phase-out).

• Car Loan Interest:

  • Deductible up to $10,000—must be a new car assembled in the US, bought after 2024.

• Federal Baby Bonds:

  • $1,000 given to all US-born children 2024–2028, with parents allowed $5,000 annual additions.

• Primary Residence Capital Gain Exclusion:

  • No significant changes yet, mostly speculation in the media.

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2. Listener Questions: Roth Conversion Advice Controversy

[10:00–16:28]

Q: Is it better to immediately convert over $1 million in IRA to Roth at once or use a tax-bracketed approach?

• Joe & Big Al’s Take:
  • Blanket advice to convert "as much as possible" is misleading; tax bracket planning matters.
  • Only convert large sums at high brackets if you know future tax rates will be even higher.

    “There’s no one-size-fits-all. I certainly don’t agree with converting a big pile of money in huge tax brackets…when you’re going to be in a smaller bracket later. Makes no sense to me.” — Big Al [11:15]

  • Examine your current and projected future bracket, ability to pay tax from non-retirement funds, and run the math.

Trending “Roth Rescue” & Insurance Gimmicks

• Roth Rescue Schemes:

  • Some advisors on social media pitch strategies like:
    • Immediate full conversion to Roth regardless of bracket.
    • Withdrawing all IRA money to dump into Index Universal Life Insurance (IUL) products, branding it as “Roth Rescue.”
    • Complex trust/IUL setups claiming to legally avoid taxes.

• Hosts’ Skepticism:

  • Joe and Al strongly warn against these approaches unless thoroughly vetted:

    “If it sounds too good to be true, it may be…” — Big Al [16:36]

    • Many such schemes skirt the tax code and could backfire in an IRS audit.
    • The best approach remains careful tax bracket management and numbers-based planning, not gimmicks.

    “By converting willy nilly is the wrong move.” — Joe Anderson [16:21]

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3. Ed Slott, Permanent Life Insurance, and IRA Withdrawals

[19:16–25:17]

Q: Why does IRA Guru Ed Slott recommend permanent life insurance as a legacy tool?

• Hosts’ Perspective:

  • Primary Takeaways:

    • For most, Roth conversions offer lower costs and more flexibility than cash value life insurance.

      “Not all non-term life insurance products are terrible…but for the average person, I’m not a huge fan.” — Big Al [21:18]

    • Life insurance may be appropriate for wealthy households:
      • Leveraged legacy when you don’t need the money for yourself.
      • Estate tax management if you’re over federal exemption limits ($15M+).

      “It’s a legacy play…if you die prematurely…the kids get the million [dollars] and it cost you $20,000.” — Joe [22:48]

    • Using life insurance to generate retirement income is usually less efficient (high fees, cost of insurance).
    • Special scenarios: special needs beneficiaries, unique legacy wishes.

  • Key Point:

    • Buy permanent life insurance only for specific, advanced estate/legacy reasons—not as a general retirement income vehicle.

      “In some small cases, insurance could be the solve...small doses.” — Joe Anderson [25:04]

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4. Listener Feedback, Trivia & Podcast Survey Highlights

[26:18–35:40]

• Correction on Quote Attribution:

  • Joe’s favorite quote, “If I would have known I was going to live this long, I would have taken better care of myself,” is attributed correctly to Mickey Mantle, not Roger Maris. [26:18–27:45]

• Death Trivia:

  • Lighthearted discussion on the ages at death of Mantle, Maris, Sinatra, Dean Martin, and Sammy Davis Jr.
  • Ends with:

    “Every day is a gift. That’s why they call it a present.” — Big Al [29:07]

• Listener Survey Results:

  • Thousands of responses; show is appreciated for financial content, humor, and “off topic” chemistry.
  • Common requests:
    • More on optimization (versus just maximizing strategies).
    • Practical gifting and estate planning strategies to pass on wealth—“without having to die.”
    • More high earner and millennial-focused topics.
    • Appreciation for the reduction of ads and Joe’s “struggle reading listener emails.”
    • Shoutout to Andy for clarity, and to FiPhysician for “Best Retirement Podcast With Humor.”
  • Prize winner reportedly spent their Amazon gift card on dishwasher pods.

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Memorable Quotes & Moments

• On “Permanent” Tax Law:

  “Permanent means whenever they change it again.” — Joe Anderson [02:03]

• Roth Conversions & Gimmicks:

  “I certainly don’t agree with converting a big pile of money in huge tax brackets when you’re going to be in a smaller bracket later. Makes no sense to me.” — Big Al [11:15]

• Skepticism on Insurance Pitches:

  “Are you a fan of that?” — Big Al
  “No, no, it’s terrible.” — Joe Anderson [12:57]

• On Life Insurance for Legacy:

  “It’s a legacy play…you have to die to get the benefit.” — Joe Anderson [22:48]

• Death Trivia Wisdom:

  “Every day is a gift. That’s why they call it a present.” — Big Al [29:07]

• Survey Humor:

  “Five million downloads, though, right?” — Joe Anderson
  “Correct. By the time this airs, we will be over 5 million downloads.” — Andy Last [30:28]

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Timestamps for Key Segments

• [01:03] — Main Law Overview & Roth Conversion Impact
• [03:26] — SALT Deduction Changes
• [04:05] — Senior Tax Credit Phasing Details
• [04:52] — Summary of Other Law Extensions (Estate, Standard Deduction, Etc.)
• [06:23] — New Car Loan Interest Deduction
• [07:50] — Baby Bond Accounts for Kids (2024–2028)
• [10:00] — Listener Q: Roth Conversion Up to Bracket vs. Full Conversion
• [12:21] — Gimmicks: "Roth Rescue" Strategies Debunked
• [19:16] — Ed Slott & Life Insurance for Retirement/Legacy
• [26:18] — Listener Correction & Death Trivia
• [30:28] — Podcast Survey Highlights & Listener Feedback

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Tone and Style

The episode maintains the show’s signature blend of expert financial advice and lively, irreverent humor. Listeners can expect banter, playful teasing, and analogies that make complex tax law both entertaining and accessible.

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Key Takeaways

• The new tax law changes provide continued opportunity for strategic Roth conversions—don’t rush to convert everything at once unless the math justifies it.
• Be wary of “Roth Rescue” and “too good to be true” insurance-based schemes.
• Life insurance has niche, advanced planning use for legacy/estate—not as a general replacement for Roth IRAs.
• Listener feedback shapes show direction—expect more about optimizing, gifting, and tailoring advice for varied income levels.
• The show values both humor and substance, making personal finance both informative and enjoyable.

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For free resources, financial planning tools, or to submit your question, visit YourMoneyYourWealth.com.

Transcript

[Andy Last]

One big beautiful bill is now law. How does it impact your Roth conversion strategies and other financial decisions? Plus, you may have seen or heard other advisors talking about their strategies for getting your retirement savings into tax free Roth accounts. How are these different from a good old Roth conversion? And what did Joe and Big Al think of them? Find out today on youn Money, you, Wealth Podcast 545 plus, why is Ed Slott, CPA, the man known to many as the IRA guru, such a fan of permanent cash value life insurance? Finally, an attempted correction From a YMYW YouTube viewer turns into a rousing game of death trivia. And we'll share some of your opinions from the 8th annual YMYW podcast survey, which just closed. Thank you to all of you for helping us make this podcast better for you. And congratulations to Larry, our randomly chosen winner of the $100Amazon E gift card. Let's kick things off today with the new tax reform. I'm executive producer Andi Last, and here are the hosts of youf Money, you, Wealth, Joe Anderson, cfp, and Big Al Clopine, cpa.

[Joe Anderson]

Hey, Al, it's been a while since this bill came out, so I thought we'd just give a brief overview. The beautiful badass bill.

[Big Al Clopine]

Don't you love the name?

[Joe Anderson]

I do.

[Big Al Clopine]

One big beautiful bill.

[Joe Anderson]

So let me. Yeah, kind of scoured through this.

[Big Al Clopine]

Okay, me too.

[Joe Anderson]

Some interesting changes and some more of the same.

[Big Al Clopine]

Yeah, I agree with that.

[Joe Anderson]

So I think we talk about Roth conversions quite a bit. So there's a couple things that would affect conversions. Let's see, what are the main things that you see that could affect someone's Roth conversions? To convert or not to convert?

[Big Al Clopine]

Yeah, Well, I think the first thing, Joe, right off the bat is the lower tax rates continue. Right. So we've been saying all along, get your Roth conversions in now right before the end of 2025, because the tax rates are gonna go up. Well, the tax rates have been extended. Not only have they been extended, Joe, but they've been extended permanently.

[Joe Anderson]

Yeah, but what does until they change it?

[Big Al Clopine]

Well, you know what permanent means.

[Joe Anderson]

So we got the 10, 12, 22, 24, 32, 35, 37% tax bracket. So still really good opportunities to convert in the 10, 12, 22. For sure. The 24 is still a giant bracket and they're going to increase those 1012, 22% brackets. They got a little inflation boost. I don't know what the hell that means, but maybe it's a little bit larger than all the other brackets or the other brackets are not getting inflated, adjusted throughout the years.

[Big Al Clopine]

You know, I don't know what, what goes, what's behind the Iron Curtain or the Green Curtain or whatever you want to call it. But at any rate. Yeah, so I mean, as, as of right now, we're looking at about $200,000 taxable income per single and about $400,000 taxable income for married. You can do a Roth conversion and stay in that 24% bracket, which is a good bracket for many people. And so, yeah, that's what's going to go up maybe by another $10,000.

[Joe Anderson]

Okay, what else is going to affect Roth conversions?

[Big Al Clopine]

Let's see. Well, I mean, some of the, some of the changes in deductions, like the. You want to talk about the SALT deduction?

[Joe Anderson]

Yeah, that's interesting. $40,000. They increase it from 10 floor to 40,000, but then it decreases depending on how much income that you have. So it phases out on you.

[Big Al Clopine]

It does. And so, yeah, we used to be able to deduct all of our state taxes and property taxes, and then in 2017 with that bill, it was reduced to $10,000 as a max. Now it's up to $40,000. But that starts phasing out with taxable income, single above $250,000 and married, $500,000. So if you're below those levels. Yeah, you can take up to $40,000 of taxes. And that would be a huge benefit for some, particularly those that live in California and other high tax states. And for those that make a lot of money, maybe it won't really impact them that much.

[Joe Anderson]

What about the tax credit? Senior tax credit?

[Big Al Clopine]

Yeah, that's an interesting one. So we already have the seniors can take additional benefits for being over 65 and or blind.

[Joe Anderson]

So you're one of the two.

[Big Al Clopine]

I'm right in there with one of those. Anyway, so they've got these. They still have the extra deductions, I should say, for those over 65 and. Or blind. You get even more benefit if you're over 65 and blind. But Joe, now that there's like a $6,000 additional amount, but that phases out pretty low, right? That phases out at about $75,000 of modified adjusted gross income for single and $150,000 for married.

[Joe Anderson]

What else? Anything else interesting?

[Big Al Clopine]

Well, I mean, I think I'd like to maybe just to recap some of the extensions. Cause we all thought the tax rates were going to change and all these things were going to come roaring back, but they're not so permanent. You're Right. Permanent means whenever they. Again. But the tax rates are lower, both individual and corporate, so that the current rates just continue. The higher standard deduction continues. The higher child tax credit, the estate tax exemption. So that's going to be 15 million next year, up from about 14 million.

[Joe Anderson]

On the federal level.

[Big Al Clopine]

On the federal level, yeah. It doesn't affect the state and QBI qualified business income, so that will be the same as it was.

[Joe Anderson]

What about. I don't know, there's a lot overtime. You got tips.

[Big Al Clopine]

Yeah. So this is tips.

[Joe Anderson]

So you side hustle, you know.

[Big Al Clopine]

Yeah.

[Joe Anderson]

For tips.

[Big Al Clopine]

Aren't you looking for tips? Yeah. So anyway, so this is between 2025 and 2028. So your tips can be tax free up to $25,000 a year of tips. And then that starts phasing out at about 150,000 of taxable income. Overtime, up to $12,500 of overtime can be exempted from income tax with phase outs.

[Joe Anderson]

What's the phase out?

[Big Al Clopine]

I think it's $150,000.

[Joe Anderson]

Well, that's still pretty high income.

[Big Al Clopine]

Pretty high income, yeah. Yeah, exactly. Right. So let's see a couple other things we haven't touched on. Car loan.

[Joe Anderson]

When does this all come into effect, like already retro 2526.

[Big Al Clopine]

Yeah. Most of it's 2025. Yeah.

[Joe Anderson]

This year.

[Big Al Clopine]

This year, yeah. Car loan interest is potentially deductible up to $10,000 of interest if it must be a new car for personal use purchase after December 31, 2024 and there. And it must be the, the, the final assembly needs to be in the United States and there's all these regulations on what's the final assembly. But stay tuned on that.

[Joe Anderson]

What about primary residence sale of that to be tax free? You see some of some language on that that I went through the press lately.

[Big Al Clopine]

You know, I've heard a lot of talk about that, but no, I haven't seen anything official yet.

[Joe Anderson]

Well, yeah, I think all it is is talk.

[Big Al Clopine]

It's talk. Yeah, yeah, yeah.

[Joe Anderson]

But that would be interesting too because I think the argument is that people are locked into their house. They don't, they can't sell because of the gains. Yeah, but that only affects a very small portion of the population because you still get the 121exclusion of $500,000 in whatever repairs or maintenance or you know, additions and things like that that you back into the property.

[Big Al Clopine]

Maybe if you live in Southern California, that'd be nice. Right. But yeah, for a lot of places where they don't really have Enough gain for it to matter that much. Something else I thought was kind of interesting. Trump accounts for kids. You hear about that?

[Joe Anderson]

Yeah.

[Big Al Clopine]

Yes. So children born in the US between 2024 and 2028, they're going to receive a one time deposit of $1,000 in their name from the US treasury managed in a. In a federally managed account. And parents can add to that if they want to, up to $5,000 per year, all the way up to their kids age 18.

[Joe Anderson]

Is it Roth?

[Big Al Clopine]

No, it's just savings could be used for school or home or whatever.

[Joe Anderson]

So it's taxable on an annual basis. What is it?

[Big Al Clopine]

I agree. That I'm not clear on.

[Joe Anderson]

Huh. Okay. Yeah, you really did your research there.

[Big Al Clopine]

They do. Well, wait a minute.

[Joe Anderson]

Your crack research team just killed it on that one.

[Big Al Clopine]

Wait a minute. Let me just tell you. First of all, this was July 4th, that was signed, so we're not too far. And it was a thousand pages. So give me a break. Haven't gone through all of it yet.

[Joe Anderson]

Well, I think we're good.

[Big Al Clopine]

Yeah, me too.

[Joe Anderson]

Yeah, a lot of the same. And then if you get in the weeds, you know, so if you have questions on it, you know, feel free to call Big Al or Jeff.

[Andy Last]

Only about 1 in 10Americans are living their definition of financial freedom. 54% say that means living debt free. 50% say living comfortably. 32% say financial freedom means not having to work, and 13% define it as being rich. But too many of us fall short of financial freedom because of lack of retirement savings, salary constraints, debt, or unforeseen emergencies. This week on youn Money, you Wealth TV, Joe and Big Al put you on your 11 step path to financial freedom. Find out how to take inventory, invest in yourself, and sustain your financial dreams and goals. Our financial Blueprint tool will help you with that first part. Taking inventory. Click or tap the financial blueprint link in the episode description. Enter your details and you'll get an analysis of your current cash flow, assets and projected spending for retirement, along with three scenarios that'll help you determine your probability of retirement success. Click or tap the links in the episode description to watch your 11 step path to financial freedom on YMYW TV and to calculate your financial blueprint.

[Joe Anderson]

Let's move on to Michael from Colorado. He goes, hello, Joe, Big Al, Andy, this is Michael. I'm in Colorado. I turned 72 in 2025 and I'm concerned about my RMDs beginning in 2026. I just listened to a webcast by Craig Weir, who's that cfp?

[Andy Last]

Cfp.

[Big Al Clopine]

No, I had no idea.

[Joe Anderson]

All right, probably pretty smart. Cfp.

[Big Al Clopine]

Yeah. Like you.

[Joe Anderson]

Just like me.

[Big Al Clopine]

Just like you. Yeah.

[Joe Anderson]

On Roth conversions, he says that if one has $1 million or more in traditional IRAs, it is far better to immediately convert as much as possible. This advice is contrary to where you recommend converting up to the top of one's tax bracket. Please discuss. And I. Thank you. Yeah, I don't know. Maybe I retract my statement on Craig.

[Andy Last]

Weird. You hear what you said?

[Joe Anderson]

Everyone has $1 million or more in IRA, convert it all, rip off the band aid and paid 50% tax.

[Big Al Clopine]

Well, but he says immediately convert as much as possible. What does that mean? Up to the tax bracket, which is the same as us, or is that everything?

[Joe Anderson]

I don't know.

[Big Al Clopine]

We don't know either.

[Joe Anderson]

Yeah, it's possible.

[Big Al Clopine]

I don't know what that means. That is that you can afford from taxes. I don't know. Anyway, I wouldn't worry too much about Craig where we're. Whatever. Cfp. It's common sense, really. If you think about it, it's like, what tax bracket are you in now? What tax bracket are you going to be in in retirement when your RMDs kick in? Those two tax brackets are going to help you decide what's appropriate for you to convert. And of course, you got to have money set aside that you can pay the taxes on it. So there's no one size fits all. But I certainly don't agree. Anyone that's telling you to convert a big pile of money in huge tax brackets when you're going to be in a smaller bracket later makes no sense to me, Jeff.

[Joe Anderson]

You know, there was a. A listener that sent me an email and he was like, hey, I'm getting. I'm seeing these things on social media. And of course, they always use a million dollars or. Or more.

[Big Al Clopine]

Yeah, right.

[Joe Anderson]

So it was like, here was a Roth rescue. It was called.

[Big Al Clopine]

Okay.

[Joe Anderson]

They didn't call it a Roth conversion.

[Big Al Clopine]

Okay.

[Joe Anderson]

It's a Roth rescue.

[Big Al Clopine]

Okay.

[Andy Last]

We've got that one in the list as well, complete with screenshot from Instagram.

[Joe Anderson]

Yeah. Basically what it is, is it's you're taking all your money out of a retirement account and putting into an index universal life insurance policy.

[Big Al Clopine]

Okay. That's what I thought you might say.

[Joe Anderson]

It's a rescue.

[Big Al Clopine]

Right.

[Joe Anderson]

You're getting money out of a tax deferred account. You're going to pay the tax now and then put everything into an iul, because then you will enjoy tax Free growth for the rest of your life. And then you get the benefit of a tax free death benefit to the beneficiaries.

[Big Al Clopine]

Got it.

[Joe Anderson]

That's a rescue.

[Big Al Clopine]

That's a rescue. Are you a fan of that?

[Joe Anderson]

No, no, it's terrible. Then there's another one that's out there, and this one is like if you had $2 million in a retirement account, okay, I only could take one client per week and only if you have $2 million or more.

[Big Al Clopine]

Got it.

[Joe Anderson]

And so it's a Roth. We can make. It's another Roth rescue. Without paying the tax. You don't have to pay the tax.

[Big Al Clopine]

Okay.

[Joe Anderson]

So did a little research for our listener.

[Big Al Clopine]

Like it.

[Joe Anderson]

And basically what I mean, this thing is convoluted and upon audit. Alan, I don't know.

[Big Al Clopine]

Might not play it.

[Joe Anderson]

Might not. I've never seen something so complex. It's taking retirement dollars, putting it into a trust. And there's got to be a charitable. They didn't really talk about, like what type of trust it is, but then there's a tax credit or a deduction that would offset the taxes that you pay as you're distributing the money out of the retirement account into this trust. Okay, but then what do you buy when it's in the trust index? Universal life insurance policy.

[Big Al Clopine]

There we go again.

[Joe Anderson]

It's another way to tell you get a tax credit or a deduction by putting the dollars into a specific trust, but you have to buy the inde universal life insurance policy within the trust. So it's still a Roth because you get the tax free growth.

[Big Al Clopine]

Okay.

[Joe Anderson]

I mean, really good marketing. This guy was like, yeah. And I worked with this top law firm in Washington, D.C. and they're the smartest people on the face of this earth. And, you know, I was like, wow, this is interesting. What the hell is this?

[Big Al Clopine]

And that's, you know, that's good till someone discovers it. And.

[Joe Anderson]

Well, yeah, I mean, I think with this person here too, which Michael's talking about is like he says, if one has a million dollars or more in a traditional ira, convert as much as he can. I don't know if that's a marketing ploy or maybe Michael, as he was watching a webcast, maybe misunderstood what this guy was saying. Maybe because I agree, if you have a lot of money in a retirement account, is all of our listeners know that as that money continues to compound in a tax deferred environment, you're going to potentially pay more tax. Those dollars are growing and you owe tax on them. So does it make sense to bite the bullet at a lower tax rate or at the existing tax rate to get those dollars out to have tax free growth, I'm 100% in favor of that. And the more dollars that you have, I think the more that you should be thinking about converting and probably the more dollars that you have, you probably have to convert more than other people that don't have as much in a retirement account. But if it's like, hey, I'm targeting people that have a million dollars or more in a retirement account and telling them convert everything without any type of strategy or plan, I would just be cautious with that. I mean it's math, you just have to run numbers. What tax bracket are you in now? What tax bracket do you think you're going to be? Given certain assumptions, we don't know what inflation's going to do. You have no idea what the market's going to do, you have no idea what tax law is going to do. So you have to make educated guess on this. So by converting willy nilly I think is the wrong move. But if you take an educated guess of saying, hey, I think tax rates might stay the same or go up a little bit, I feel that inflation could be at the same historic inflation rates of the last 30 years and maybe a conservative growth rate on your investments over a 10, 20 year period, I think that's the right way to think about it.

[Big Al Clopine]

Yeah, I think some of these schemes.

[Joe Anderson]

Maybe I'll call it a well scheme, that's it's strategy. Could be strategy, could be.

[Big Al Clopine]

Just be careful, just be careful. If it sounds too good to be true, it may be. I'm not saying for sure it is or it isn't. I'll give you an example. I had a client years ago when I had a tax practice who had a company that he wanted to sell. Joe, he wanted to sell to investors and cash out. And he went to this law firm and he was told, you know what, you put your stock in this partnership and the partnership buys into this trust and the trust buys into an S corp. And then you got this doing this and then pretty soon you get all the money and it's return of capital, no tax. And he said to me, what do you think? And I said, run away. I said, first of all, it's way over my head. And secondly, I can't imagine, I mean this is not the spirit of the law anyway. So he paid all this money to this law firm and right before he's about to execute the law firm said we, we found it didn't work. They probably got cut, had to return the money, and they did.

[Joe Anderson]

Oh, good.

[Big Al Clopine]

So just be careful. Some of these. Some of these things, I don't know, just if it sounds too good to be true, it. That may be the case.

[Joe Anderson]

It just depends, I guess, on how aggressive they want to be.

[Big Al Clopine]

Well, I suppose. Yeah.

[Joe Anderson]

So.

[Big Al Clopine]

Yep.

[Joe Anderson]

All right, let's continue on. Hey, Joe, Big Al, Andy, this is Brian from Queens. It's been about three years since I last wrote in. Well, Brian, where have you been, buddy? So perhaps it's been enough time to write back. I'm so glad I made the highlight reel in episode 500, poking fun at my midlife crisis red convertible, which I don't have. Instead, still cruising around my 2012 Honda Odyssey minivan. Don't remember making fun of Brian.

[Big Al Clopine]

Well, I. I do. We've talked about red convertibles from time.

[Joe Anderson]

Yeah, because you had one.

[Big Al Clopine]

Yeah, that was my midlife crisis. So we kind of relay. We kind of, you know, expounded that on.

[Joe Anderson]

When does that leave? When did you get it and when did it. When did it dissipate?

[Big Al Clopine]

I think I got about 45 and it took me a while.

[Joe Anderson]

54.

[Big Al Clopine]

Yeah, it took me like seven or eight years. Some people it's like six months. Me, I'm just cruising around. It's winter in San Diego. I got the heat blasted. I mean, it's not that cold here, but it still was cold driving down the freeway in December. I came into work, my hair was always like. But, boy, that was fun.

[Joe Anderson]

Yeah, yeah, yeah. Oh, yeah. Mike Schmidt, big mustache.

[Big Al Clopine]

Oh, yeah. I had it all. I was. That's quite the catch. Back then, even though I was married. Happily married, by the way.

[Joe Anderson]

Let's see, my drink of choice has changed up the Jackie Cokes to a light beer on occasion. Oh, look at Brian on the health kick. The sugar gives me those headaches. All right, my question is the following. I am reading Ed Slok's new book, the Retirement Savings Tax Time Bomb Ticks Louder. Excellent book, but can make my head spin with all the complicated tax rules, particularly with IRAs. I believe many in the financial space you guys include believing any life insurance other than term is usually a lousy product and not to be purchased. Why then does Ed seem to be a strong advocate of the permanent cash value life insurance policies? Basically taking withdrawals from your IRA and paying the premiums from that and your beneficiaries receive the benefit tax free and clear. Would it make more financial sense to simply do Roth conversions? Aren't you essentially getting to the same place. I would think those cash value life insurance premiums would cost a fortune. Thank you, Brian. I'm a big fan of Ed Slot.

[Big Al Clopine]

Yeah, me too.

[Joe Anderson]

He was just, he was on, I don't know when was that?

[Andy Last]

He's been on a couple of times. Yeah, Ed and Al had a conversation at the Horizons conference there in San Diego.

[Big Al Clopine]

He was really fun to interview too. He's a live wire, I mean for a CPA to interview a cpa. Can you imagine?

[Joe Anderson]

Oh, sounds like a blast.

[Big Al Clopine]

Oh, it's amazing.

[Joe Anderson]

I don't know. Do you want to take a stab at it? I got a couple thoughts around this.

[Big Al Clopine]

Well, in my way of thinking, it can work. And not all non term life insurance products are terrible. Some are lower cost and depending upon your situation, I actually think, Joe, maybe if you've got a lot of money over and above the estate tax exemption, I think there's some possibilities there. I don't know. But I would say for the average person, I'm not a huge fan.

[Joe Anderson]

I think what Ed is referring to is leverage and it's not to live off. So you put money into a Roth ira, which is great. I would first absolutely go there if I'm converting dollars because the Roth IRA is going to be a lot less expensive. You can go into very low cost funds. You're going to get a better growth rate because there's no cost of insurance dragging you down.

[Big Al Clopine]

So.

[Joe Anderson]

But what when life insurance makes sense is that if you absolutely do not need the money and you're trying to use leverage on your death. Right. So for instance, let's say that you have a million dollars in a retirement account and you're converting that over time and then you're hopeful to get the full million dollars into the Roth IRA before you pass and then it goes to the kids or your spouse or whoever, you know that it's 100% tax free because everything is in the Roth and you pay tax over time. And so you plan it out perfectly and you didn't need the dollars. Or you could say, hey, I'm going to take the same conversion amount but I'm not going to convert it into a Roth. I'm going to take that $20,000 a year or whatever the dollar is. I have no idea. How old is Brian from Queens? It doesn't say so I have no idea. But, but let's say you're taking those dollars and you're paying a million dollar death benefit. So if you die prematurely and you put $20,000 in. Right. The kids get the million dollars and it only costs you 20,000 to get the million.

[Big Al Clopine]

That's true. So you have to die.

[Joe Anderson]

You have to die to get the benefit. The internal rate of return on the death benefit.

[Big Al Clopine]

Yeah, yeah.

[Joe Anderson]

So it's a legacy play. It's like, all right, well, I have so much dollars that I want to get these dollars or leverage the amount of dollars of tax free going to the next generation. It's not used as a retirement income strategy. You don't want to put. In my opinion. This is not advice. This is just my humble opinion of. I'm not a big fan of. All right, let's utilize life insurance as a cash value mechanism to create income in retirement. Just because there's a drag on fees and costs and there's a cost of insurance there. I would much rather get it into a Roth ira. You're going to have way more flexibility and you're going to get a lot higher growth, potentially because of the lack of fees and costs associated with it.

[Big Al Clopine]

Yeah, well, I like the way you said it. And just to sort of relate that to. I think what I said or tried to say is when you have an estate so you can buy life insurance, you get it outside of your state. And you have to be careful how you do that. You have to have a beneficiary outside the estate that pays for the life insurance or you make contributions or you have gifts to this individual that goes to life insurance. And there is a workaround, but they have to sign a letter. It's called a crummy letter.

[Joe Anderson]

Crummy letter.

[Big Al Clopine]

It's a whole nother topic. But you can do that to where, when you pass away, your life insurance policy is not part of your estate. And again, where you see this done mostly is when there's either a desire to get a lot of money out of the estate tax rate and usually that's because you're up against the estate tax limits, which. Joe, when I started my career it was 600,000 doll, and then it was up to a million and then 5 million. Now next year it's going to be 15 million. So for the average person, it's not terribly relevant.

[Joe Anderson]

I would say, yeah, I don't know, let's say if you had special needs child, if you. I don't know, there could be instances where you wanted to make sure that there's a big chunk of money in.

[Big Al Clopine]

Case something happens to you.

[Joe Anderson]

Yeah. That's available and you have a lot of money in a retirement because retirement accounts are the worst account that you can transfer to the next generation.

[Big Al Clopine]

Yeah, right.

[Joe Anderson]

They got to distribute it within 10 years. It's all ordinary income tax. So in some small cases, insurance could be the solve.

[Big Al Clopine]

Yeah, it could be.

[Joe Anderson]

So like I said, small cases, small doses.

[Big Al Clopine]

Okay. All right.

[Andy Last]

It's important to understand Roth accounts and how they work so you can take full advantage of the lifetime tax free investment growth that they offer. Click or tap the link in the episode description to download the Ultimate Guide to Roth iras for free. You'll have valuable information in print, mind you, about how Roth contributions and conversions allow you to keep and grow more of your money. Plus, you heard the fellows mention the infamous backdoor Roth strategy earlier. This guide explains how it can help even if you make too much money to contribute directly to a Roth. Plus, learn the differences and pros and cons of saving In a traditional IRA versus a Roth IRA versus a Roth 401k, the rules for taking money out of your Roth account, and much more. Click or tap the link in the episode description to download your copy of the ultimate guide to Roth IRAs and share YMYW and all the free financial resources with anyone you know who would benefit.

[Joe Anderson]

All right, Dan writes in, he goes, hey, tell Joe that, quote, if I would have known I was going to live this long, I would have taken better care of myself. Was from Mickey Mantle, not Roger Maris.

[Andy Last]

Yeah, I went and dug it up. That's actually from an episode of the TV show. And you did actually attribute that to Mickey Mantle. But then you mentioned the fact that you watched a movie about Mantle and Maris. So I think there might have been.

[Big Al Clopine]

Some disconnect, maybe got confused.

[Joe Anderson]

31, 61.

[Big Al Clopine]

I. I sort of remember you talking about that too. And I remember you saying Mantle as well.

[Joe Anderson]

Yeah, I think it was even on the.

[Big Al Clopine]

On.

[Joe Anderson]

It was on the graphic.

[Big Al Clopine]

Yeah.

[Joe Anderson]

And it said Mickey Mantle and had.

[Big Al Clopine]

It in the transcript. Had you said Roger Maris, I would have corrected you because I knew it was metal that said that.

[Joe Anderson]

Yeah, well, Roger Maris was the one that was kind of like. He was always in shape, the married man, the. Yeah, you know, kind of the goody two shoe kind of guy. And Mantle was the one just pounding cocktails and split sig.

[Big Al Clopine]

He was. Yep, yep.

[Joe Anderson]

How long did Mickey Mantle live till?

[Big Al Clopine]

I want to say, 90 80s, 70s. Maybe Andy will check it out for us.

[Andy Last]

Actually, he was only 63 when he died.

[Joe Anderson]

63?

[Andy Last]

Yep.

[Joe Anderson]

Oh, well, what about Roger Maris?

[Andy Last]

One moment. What do you want to bet that he lived a really long life?

[Joe Anderson]

That's tragic. 63.

[Big Al Clopine]

I know.

[Andy Last]

Maris lived to 51.

[Joe Anderson]

Maris lived at age 51?

[Andy Last]

Yep.

[Big Al Clopine]

I think somehow I knew that he died young. I don't know of what, but I think I knew that.

[Joe Anderson]

Oh, yeah, man, this is just depressing.

[Andy Last]

Alcohol induced cirrhosis and hep C was Mickey Mantle. That's how he died.

[Big Al Clopine]

Well, yeah, well, that I get. How about that?

[Andy Last]

And inoperable liver cancer. Man, talk about rough.

[Big Al Clopine]

Yeah. Yeah.

[Joe Anderson]

Okay. Geez. Well, you know what? If you look at, like, the Rat Pack, Sinatra, I mean, he lived. Those guys lived a long time.

[Big Al Clopine]

They lived. They lived.

[Joe Anderson]

And I would imagine they partied just as hard as Mickey Mantle.

[Big Al Clopine]

I would think so, yeah. I mean, they had that reputation anyway.

[Joe Anderson]

Yeah, well, who's the one that was. He kind of always acted drunk. Dean.

[Andy Last]

Dean Martin.

[Big Al Clopine]

Oh, yeah.

[Andy Last]

So Sinatra died at age 82.

[Joe Anderson]

Yeah.

[Big Al Clopine]

Okay.

[Andy Last]

Dean Martin lived to be 78.

[Big Al Clopine]

Oh, 78. Okay.

[Joe Anderson]

What about Sammy Davis? We're playing death trivia here. This is Wonderful.

[Andy Last]

Sammy Davis Jr. Was only 64 when he died.

[Joe Anderson]

Oh, boy.

[Big Al Clopine]

64. Yeah.

[Joe Anderson]

You know, when you get a certain age, it's like, weird how you just. You don't. Because you're just a health freak.

[Big Al Clopine]

Well, I'm already there, so that's why I say things like, every day is a gift.

[Joe Anderson]

Yes, it's a present. That's why they call it, why they.

[Big Al Clopine]

Call it a present.

[Joe Anderson]

That's why they call today a present. A present.

[Big Al Clopine]

Yep. The past is history, future is a mystery. But today is a gift. That's why they call it. That's why they call it a present.

[Andy Last]

The present. Yeah. I'm always surprised when people are, like, you know, really down about the fact that, oh, tomorrow's my 70th birthday or my 75th birthday. It's like, man, celebrate. You're still here. You're above ground.

[Big Al Clopine]

It's awesome. Enjoy another day. Or more. Yeah, you think about those. Have those satsis.

[Joe Anderson]

It's like, oh, my God. Well, 20 years and you've outlived 70.

[Big Al Clopine]

Outlived Maris already.

[Joe Anderson]

And then it's like. Yeah, I know. Yeah, like 20 years. I'm gonna be 70. My kid's gonna be like 21. We could finally have a beer together.

[Big Al Clopine]

Yeah, finally. Yeah, right? Hopefully you'll still be able to drink by then.

[Joe Anderson]

70. Oh, come on, dude. I'm gonna be the sexiest 70 man you'll ever see in your life.

[Andy Last]

Stop drinking now so that you can actually have a whole bunch of them later.

[Big Al Clopine]

Sometimes doctors, orders, you know, things happen.

[Joe Anderson]

Yeah. The beacon of Health.

[Big Al Clopine]

I can see. Yeah.

[Joe Anderson]

Thank you. All right, survey time. Survey says.

[Andy Last]

Survey says people love the show. That's the overall.

[Joe Anderson]

How many people responded? 7. You can exaggerate a little bit.

[Andy Last]

Okay, well, then it's thousands.

[Joe Anderson]

Okay, perfect. Five million downloads though, right?

[Andy Last]

Correct. By the time this airs, we will be over 5 million downloads.

[Big Al Clopine]

Wow.

[Andy Last]

And it's not all Ruthie.

[Joe Anderson]

She gets bored. She's retired. So findings they like to show.

[Andy Last]

Financial topics are of most importance to you today. Somebody said more discussion on optimizing as opposed to maximizing. Also how to pass wealth on without having to die. So that's an interesting one.

[Big Al Clopine]

Okay.

[Joe Anderson]

Like more charitable planning or like, I wonder. Given to the kids, I think.

[Big Al Clopine]

To the kids.

[Andy Last]

I think it's probably to the kids.

[Joe Anderson]

Gifting strategies.

[Big Al Clopine]

Gifting strategies. Yeah, we could think about that.

[Joe Anderson]

Optimizing versus maximizing. Tell me more. What is. What. What. What do we think we need by that to optimize? What's the difference between. I mean. So we talk about maximizing versus optimizing.

[Big Al Clopine]

I. I didn't know there was much of a difference.

[Joe Anderson]

I don't think so. Maybe there's a sliver of a difference.

[Andy Last]

Another interesting thing was how people discovered the youe Money, you, Wealth podcast. Obviously a lot of people said that they actually specifically searched for a term in their podcast app or it was suggested in their podcast app because of other things that they listen to. But we had some other interesting ones as well. Years ago, I read an article about the best retirement pods and yours was listed. Somebody said, searching for what to do with the money we've been diligently saving for 30 plus years. That's how they found it.

[Big Al Clopine]

First came up on a. Yep. Wow.

[Andy Last]

Somebody said it was suggested on Reddit as a good podcast for retired people looking to preserve their wealth and minimize taxes. So thank you, Redditors. And then also somebody said that they were reminded of it by David Graham, who, if you'll recall, is the physician who does fiphysician.com and for years now has rated your money youy Wealthy Best Retirement Podcast with humor. So thank you to Fi Physician.

[Big Al Clopine]

I have seen that.

[Joe Anderson]

Yeah, it doesn't have sophistication, but it's funny.

[Big Al Clopine]

You can't really trust what they say, but it's funny.

[Andy Last]

So under what keeps you coming back? Somebody said, I'm glad to see that the show has a CPA for additional perspective. So shout out to you, Al. Love the stories and analysis of the situations. I'm an absolute junkie for this and I do it Professionally. So that's somebody in the business that likes the show.

[Joe Anderson]

All right.

[Big Al Clopine]

Okay.

[Joe Anderson]

Sending in his clients information.

[Big Al Clopine]

Yeah. Right. Yeah, we know that that happens in.

[Andy Last]

Response to what keeps you coming back. Somebody said the content. Love Andy and the Shenanigans. So that sounds like a band name to me. Andy and the Shenanigans.

[Big Al Clopine]

Okay, accepted.

[Andy Last]

It's hilarious. I'd be the drummer, of course. Yeah, it's hilarious. I've nearly fallen off of my elliptical machine while working out on several occasions.

[Big Al Clopine]

Oh, that sounds dangerous. Yeah.

[Andy Last]

Somebody said, good, honest information in an entertaining manner. And Joe's excellent reading killed it.

[Big Al Clopine]

Yep.

[Joe Anderson]

Hooked on Phonics.

[Andy Last]

We had a few different people who said, I like to test my knowledge. I like to guess if my answer will be the same as yours when you're doing spitballing.

[Big Al Clopine]

Cool.

[Andy Last]

What are your favorite things about the YMYW podcast? I enjoy the financial discussions, but also when Joe and Al get off topic, they've got great chemistry.

[Big Al Clopine]

Hold on now there.

[Andy Last]

I like that there are no commercials. Many other podcasts have so many commercials. And I like that Andy is there to either show the guys something that someone mentioned, a picture of their car or dog, or I help to clarify what the writer is trying to say.

[Big Al Clopine]

Helpful for us too.

[Andy Last]

Well, good. What would make it better for you? Somebody said, I really can't stand the listener. Audio submissions, they usually take way too long, and I lose interest every time. We may have to discuss whether or not we want to continue that feature. I think that there's been an overwhelming response of people who love listening to Joe struggle through these emails.

[Big Al Clopine]

That's what makes the show right.

[Joe Anderson]

Yeah, it's terrible. That's why they can only listen for, like, six months.

[Big Al Clopine]

I know.

[Joe Anderson]

This guy is an absolute.

[Big Al Clopine]

It's just not funny anymore.

[Joe Anderson]

It's just awful. Come on, dude, learn how to read already.

[Andy Last]

A number of people said that they really enjoyed the guests that we've had recently and they'd like to see us bring some more of those back to mix things up. I like that Al usually does some homework for the questions. It's a good one.

[Big Al Clopine]

Okay.

[Andy Last]

Somebody said, more. More millennial content and high earners content. It's interesting. We have a lot of things for high earners, but somebody would like more. And in response to what would make the show better for you? Somebody said, I mostly read the transcripts.

[Big Al Clopine]

They don't want to listen to it. But you would you want to read the transcripts?

[Joe Anderson]

Absolutely. No, no, that would be worse.

[Andy Last]

So there you go. That's the 8th annual 2025 YMYW podcast survey.

[Big Al Clopine]

Well, thank you. Thank you all. That's a lot of nice things that you said. So, yeah, really appreciate it.

[Joe Anderson]

Yeah, we take the good and bad and we try to implement it into.

[Big Al Clopine]

The show, try to improve, if that were possible.

[Andy Last]

And congratulations to the winner of our $100Amazon E gift card. If you'll remember correctly, somebody actually wrote in that was last year's winner and said that they bought dishwasher pods with it. So maybe somebody else will get such a good thing.

[Joe Anderson]

All right, very good. Alrighty. Well, thank you all. Keep the questions coming and we'll keep struggling through reading them. That's it for us. Andy, Bo, wonderful job. Good day, mate.

[Andy Last]

Good day. Thanks very much.

[Joe Anderson]

How about you, Aaron? How you doing over there?

[Big Al Clopine]

He's the silent person.

[Joe Anderson]

Just switch the camera twice. Wonderful job. All right, Big Al, you here next week?

[Big Al Clopine]

Yes, I am.

[Joe Anderson]

Okay. All right, we'll see you guys next week. Joe's called you'd money. You're welcome.

[Andy Last]

Thank you all again for all of your input in the survey. Your money, you, wealth is your podcast. We just make it for you. If you've got more thoughts to share about YMYW, email me at podcastsourefinancial.com A lot of you have been telling us you want to hear about more people with not so fat wallets. So next week, all of the spitballing Joe and Big Al do are, for YMYW audience members was less than 2 million bucks. See, we do listen. Joe and Masako in Washington, Reed in Indiana, Old McDonald in Maine, Conshahak and Kurt and Mr. Buckeye in Ohio, you're up next week on YMYW, so tell a friend to tune in and to follow us in their favorite podcast app or to subscribe and watch us do all this silliness on YouTube. Your money, you, wealth is presented by Pure Financial Advisors. It takes more than just a spitball from these fellas to map out your entire retirement future. Book a free financial assessment with one of the experienced professionals on Joe and Big Al's team at Pure. They'll help you save as much tax as possible now and in the future. They'll make sure you're investing investments are aligned with your tolerance for risk and that your overall financial plan is tailored not only to meet your retirement needs, but also your retirement lifestyle. Click or tap the free assessment link in the episode description or call 888-994-6257 to schedule your assessment. Now you can meet with the Pure team either online via Zoom or in person at any of our nationwide locations. Tell them you heard about it on the youe Money, you, Wealth podcast. Pure Financial Advisors is a registered investment advisor. This show does not intend to provide personalized investment advice through this podcast and does not represent that the securities or services discussed are suitable for any investor. As rules and regulations change, podcast content may become outdated. Investors are advised not to rely on any information contained in the podcast in the process of making a full and informed investment decision.