Latest / Suze Orman's Women & Money (And Everyone Smart Enough To Listen) / Don’t Sell The House To Get Out of Debt

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Don’t Sell The House To Get Out of Debt · Suze Orman's Women & Money (And Everyone Smart Enough To Listen)

• 0:08
  Suze: October 19, 2025. Welcome everybody..
• 0:12
  KT: To the Women and Money podcast,
• 0:13
  Suze: and everybody's smart enough to listen. This is...
• 0:17
  KT: Ask...no, this is Sunday.
• 0:20
  KT: It's, I was about to say this is Ask Suze anything,
• 0:23
  KT: but it's Sunday, and on Sunday, guess what, you can
• 0:27
  KT: still ask Suze anything. I'm doing the show with her
• 0:31
  KT: on Sunday.
• 0:32
  Suze: So here's the thing, everybody, as you know, if you've
• 0:35
  Suze: listened to the Women and Money podcast and everybody smart
• 0:39
  Suze: enough to listen.
• 0:40
  Suze: We are in Italy as you are listening to this,
• 0:45
  Suze: but we pre-recorded it, so you wouldn't have to just
• 0:49
  Suze: listen to best of the whole time we're gone. However,
• 0:55
  Suze: because I don't really know what's happening out there in
• 0:57
  Suze: the economy and things like that, it's just better that
• 1:00
  Suze: KT and I do for the whole time we're gone,
• 1:03
  Suze: Ask KT and Suze Anything and
• 1:06
  Suze: I'm starting to like it. Maybe KT, what do you think?
• 1:09
  Suze: Should we just go to once a week with just us?
• 1:12
  KT: Why not?
• 1:12
  Suze: Maybe twice a week with just us?
• 1:14
  KT: Why not?
• 1:15
  Suze: Yeah, maybe we'll do...
• 1:16
  KT: And how about YouTube and us.
• 1:18
  Suze: Oh, here we go. All right, so she wants me
• 1:22
  Suze: to tell all of you, you should definitely subscribe to
• 1:26
  Suze: my YouTube channel. Go to youtube.com/ Suzeorman.
• 1:32
  Suze: And just subscribe. Just do it. You won't regret it.
• 1:35
  Suze: So that's why it's KT and me today. All right, KT,
• 1:40
  Suze: school me.
• 1:41
  KT: All right, my first question is from Maria. She said, Hi,
• 1:44
  KT: KT and Suze, I've been listening to you for a
• 1:47
  KT: couple of years now, and I'm so afraid of losing
• 1:51
  KT: any money. I just can't afford it.
• 1:55
  KT: So Maria said, I do have a Roth IRA, but
• 1:58
  KT: I would like to do more. I know you've spoken
• 2:01
  KT: about having a Roth IRA in VOO, but I'm not
• 2:05
  KT: sure how to go about that. Please help. So sweet,
• 2:09
  KT: very sweet. So let's help Maria.
• 2:12
  Suze: But first, Maria, I have a question. You say that
• 2:16
  Suze: you have been listening to me now for a couple
• 2:20
  Suze: of years.
• 2:22
  Suze: And you're so afraid of losing any money. KT, that
• 2:26
  Suze: kind of means we haven't really done a very good
• 2:28
  Suze: job for those two years that she's been listening.
• 2:32
  Suze: Because one of the main objectives of the Women and
• 2:35
  Suze: Money podcast, and everybody smart enough to listen is to
• 2:40
  Suze: diminish your fear, to take it away, to instill courage
• 2:46
  Suze: and bravery in you to just try. So Maria, what
• 2:51
  Suze: I would say to you is.
• 2:53
  Suze: And I think about this all the time, and I've
• 2:55
  Suze: given this example and we still do it here when
• 2:58
  Suze: we go in the ocean. Sometimes when we go in
• 3:01
  Suze: the ocean, it's really cold, especially during the winter months.
• 3:06
  Suze: We just don't go in and jump in, and that's it.
• 3:09
  Suze: We go a little bit, especially me, then a little
• 3:12
  Suze: bit KT just jumps in.
• 3:13
  KT: I was gonna say speak for yourself.
• 3:15
  Suze: I know who you are, right? So but a little
• 3:18
  Suze: by little and as soon as I get used to it,
• 3:20
  Suze: then I take the final dip in.
• 3:24
  Suze: So how would you go about it? You would go
• 3:27
  Suze: about it little by little. Decide on an amount of
• 3:31
  Suze: money every single month that you feel comfortable with putting
• 3:36
  Suze: it into an ETF like VOO. You say you already
• 3:40
  Suze: have a Roth IRA.
• 3:42
  Suze: So within the Roth IRA just do exactly what I
• 3:47
  Suze: just told you to do with VOO, and I promise
• 3:51
  Suze: one day somebody's going to be happy and that will
• 3:54
  Suze: be you. Get it, KT?
• 3:57
  KT: You and VOO
• 3:58
  Suze: You and VOO all right, doll.
• 4:00
  KT: OK, my next question is from Jude, and Jude said,
• 4:05
  KT: I am...
• 4:09
  Suze: Hey Jude, (singing) that should have been Maria.
• 4:12
  Suze: Don't be, isn't it? Don't be afraid. Yeah, so hey Maria,
• 4:16
  Suze: don't
• 4:16
  Suze: be afraid.
• 4:17
  KT: All right, so hello Suze and KT. I'm a 70
• 4:20
  KT: year old retired female. I have a whole life insurance
• 4:25
  KT: policy I bought two years ago just so my two
• 4:29
  KT: children will have a little something upon my passing along
• 4:33
  KT: with a small 401k.
• 4:36
  KT: My annual premium is $2,569 for a $50,000 insurance policy
• 4:45
  KT: with Mutual of Omaha. There are no paid dividends. Is
• 4:50
  KT: there something better or is this a good policy? So she's...
• 4:54
  KT: listen to this again. I keep doubting if this is
• 4:58
  KT: the best thing for the money. She said I could
• 5:01
  KT: put the premium into my 401k if that makes more sense.
• 5:06
  KT: So you should see Suze's face.
• 5:08
  Suze: Well, I, my face looks like this because I answered
• 5:11
  Suze: her directly.
• 5:12
  KT: Oh, so would you tell her to do?
• 5:15
  Suze: I told Jude, let's not worry about the kids. You're
• 5:21
  Suze: 70 years of age. You are four years younger than me, OK?
• 5:28
  Suze: You are still young. Hopefully you have vitality and you
• 5:32
  Suze: have a lot of living to do yet.
• 5:35
  Suze: So can we just start thinking about ourselves versus our kids?
• 5:40
  Suze: Really everybody, if you pass something along to them, OK,
• 5:45
  Suze: but the greatest thing you can pass along to them, Jude,
• 5:48
  Suze: is them seeing that their mother is living life. Not, oh, look,
• 5:54
  Suze: we got this money, but my mom didn't do anything.
• 5:58
  Suze: She was miserable or whatever it may be.
• 6:01
  Suze: So can we just change how you think? What I
• 6:04
  Suze: showed her was you can keep this if you want,
• 6:08
  Suze: or if you simply took the 2,569 and you invested
• 6:12
  Suze: it for 10 years at an average rate of like
• 6:15
  Suze: 8 or 10%, you'd have about $45,000 for 20 years,
• 6:19
  Suze: you'd have about 160 some odd thousand. You'd have far
• 6:22
  Suze: more to leave them,
• 6:24
  Suze: if you live your normal lifespan than if you just
• 6:29
  Suze: have this policy, so yeah, you can do better things
• 6:33
  Suze: with it than that. However, never cancel an insurance policy
• 6:37
  Suze: unless you know you are perfectly healthy, period. All right.
• 6:44
  Suze: You see, everybody, wait, let me just say something here.
• 6:48
  KT: She sneaks in and sees all my selections.
• 6:51
  Suze: This last week I went a little crazy as KT
• 6:54
  Suze: will tell you right before we left, which is I
• 6:57
  Suze: answered so many of your questions personally and all of
• 7:01
  Suze: you know that I did when you got them.
• 7:05
  Suze: And so I also, by the way, said thank you
• 7:08
  Suze: to hopefully all of you that sent in what the
• 7:12
  Suze: name or the subtitle of the Women and Money podcast
• 7:15
  Suze: should be. There are a few that we like a
• 7:17
  Suze: whole lot, right KT?
• 7:19
  KT: Uh, again, there's many that we like.
• 7:21
  Suze: So we'll pick one. We'll see, right? But you know,
• 7:25
  Suze: I sent every one of them back a little thank
• 7:27
  Suze: you note, and they went.
• 7:28
  KT: Whoa.
• 7:30
  Suze: So anyway, there you go. So if you have a question,
• 7:33
  Suze: write in to ask Suzi podcast@gmail.com. You never know when
• 7:39
  Suze: KT will choose it, but you never know when I'll
• 7:42
  Suze: ask you directly. However, keep it short. Go on, KT.
• 7:47
  KT: OK, this next question is from Leslie, and I think
• 7:50
  KT: Leslie needs
• 7:51
  KT: to have a little talk with the in-laws ready? Loyal
• 7:55
  KT: listener for over a year here. My brother-in-law is in
• 8:00
  KT: money trouble. He owes $200,000 with a 12% annual interest
• 8:07
  KT: in an unconventional loan that can be paid in as
• 8:11
  KT: little or as long as possible, and then she wrote, sketchy,
• 8:17
  KT: I know.
• 8:19
  KT: He's not good with money. When it says unconventional loans.
• 8:22
  KT: Something's a little awry. Suze, I originally thought a HELOC
• 8:26
  KT: loan was a good idea, but they're at 18% where
• 8:30
  KT: he is. I believe he should sell his house, which
• 8:33
  KT: is worth about 5 or $600,000. Get out of this
• 8:37
  KT: mess once and for all and start fresh. He has
• 8:41
  KT: a family. They could rent or live with relatives to
• 8:45
  KT: truly save up and get ahead. What do you think?
• 8:49
  KT: So she wants, she wants some tips on how to
• 8:52
  KT: talk to him.
• 8:54
  Suze: No, she wants a tip on what he should do.
• 8:57
  Suze: And then hopefully she'll say, you know what, brother-in-law, you
• 9:02
  Suze: need to listen to Suze on the Women and Money
• 9:05
  Suze: podcast and listen to what she thinks you should do.
• 9:08
  Suze: Leslie and brother-in-law in case he's listening.
• 9:13
  Suze: All right, I get you owe 200,000.
• 9:17
  Suze: But the goal is not to just get out of
• 9:20
  Suze: this debt.
• 9:22
  Suze: Because if we can't figure out why you got into
• 9:26
  Suze: this debt to begin with, you're just going to get
• 9:30
  Suze: into it all over again. Was it a gambling problem?
• 9:35
  Suze: What did it come from and why did you accumulate
• 9:39
  Suze: it and why is it at such a high interest rate?
• 9:44
  Suze: Now Leslie, you say that you think that a HELOC would
• 9:47
  Suze: have been a good idea, but they're at 18% where
• 9:50
  Suze: he is. No, they're at 18% because his FICO score
• 9:54
  Suze: is so low that for anybody to even lend money
• 9:58
  Suze: on a house that has equity to somebody who is
• 10:02
  Suze: irresponsible with paying money back, that's when they raise the
• 10:06
  Suze: interest rate. So another danger sign. So no, I would
• 10:11
  Suze: not number one, take out a HELOC.
• 10:14
  Suze: And number two, I would not sell the house to
• 10:19
  Suze: pay off this debt. Why? Because this debt, even though
• 10:24
  Suze: it may be sketchy, may be an unsecured debt, which
• 10:29
  Suze: means he can't pay it. He can't do whatever. They
• 10:33
  Suze: can't take his house. They can't take something.
• 10:37
  Suze: Like what kind of debt is this? If you sell
• 10:41
  Suze: the house, you pay off the debt now they rent
• 10:46
  Suze: or do whatever they have, you know, 300,000 or whatever
• 10:49
  Suze: they have in equity in that house. He's going to
• 10:53
  Suze: blow it before you know it. Then they won't even
• 10:56
  Suze: have a home to live in. So therefore.
• 10:59
  Suze: We got to figure out how did he get into
• 11:01
  Suze: this debt. Why hasn't he been able to pay it off?
• 11:05
  Suze: What's really going on with him? So rather than giving
• 11:09
  Suze: him financial advice, you need to start talking with him
• 11:14
  Suze: in terms of personal advice as to what the hell
• 11:18
  Suze: is going on with you and why.
• 11:21
  Suze: 'Cause until you figure that out, you cannot solve this.
• 11:25
  Suze: How many times have I said you can never solve
• 11:29
  Suze: a financial problem with money, and this man has a
• 11:34
  Suze: problem with money, period. KT, next question.
• 11:39
  KT: All right.
• 11:40
  KT: So next question...
• 11:41
  Suze: you weren't expecting that, were you?
• 11:43
  KT: No, I actually thought you were going to say to
• 11:45
  KT: sell the house, but it is true. First of all,
• 11:48
  KT: an unconventional loan, hmm. That to me was the big
• 11:54
  KT: red flag, unconventional loan. He better fess up and tell
• 11:58
  KT: the truth.
• 11:59
  KT: Yeah, first to himself. All right, next question is from Bryant,
• 12:04
  KT: and Bryant says, Hi, Suze, my wife and I are
• 12:06
  KT: both 45 with two kids, nine and five. We have
• 12:11
  KT: some questions about getting an estate plan together. I'm currently
• 12:15
  KT: working in the New York City school system.
• 12:18
  KT: And my wife is a homemaker. Should something happen to us,
• 12:23
  KT: how can we set up our kids so that they
• 12:25
  KT: can be financially stable? What type of trusts are out
• 12:29
  KT: there so that we can provide them with income? Mhm.
• 12:34
  KT: So there you go. I think they don't have a
• 12:37
  KT: real trust... they need must have documents end of story.
• 12:39
  Suze: No they don't.
• 12:39
  KT: Why?
• 12:42
  Suze: They do, but they need something more than that, KT (Suze makes the wrong answer sound).
• 12:47
  KT: All right, sorry, I got that quizzy wrong.
• 12:49
  Suze: Got that quizzy wrong
• 12:51
  Suze: Listen, Bryant, you're both 45 and you have two minor children,
• 12:57
  Suze: so it's true that you need to protect them. Now
• 13:01
  Suze: you do not say in here that you own a home.
• 13:05
  Suze: It doesn't really say that you own anything, except these kids.
• 13:09
  Suze: And what you want to know is how do you
• 13:12
  Suze: protect these kids? So the very first thing that you
• 13:15
  Suze: should do is get a term life insurance policy on
• 13:20
  Suze: both you and your wife because even though you may
• 13:24
  Suze: have some insurance with where you work.
• 13:27
  Suze: It's probably one year's salary, so it's not enough to
• 13:31
  Suze: really set them up, and at 45, if you got
• 13:35
  Suze: a 20 year level term policy, assuming that you are
• 13:38
  Suze: both healthy, you could get 1 million, 2 million on
• 13:41
  Suze: each of you or more.
• 13:44
  Suze: And then if something happened to one of you, the
• 13:47
  Suze: other would actually be protected. If something happened to both
• 13:51
  Suze: of you, then your kids would be protected, especially if
• 13:56
  Suze: you left that policy to a trust. Now this is
• 13:58
  Suze: where KT is correct.
• 14:01
  Suze: Ding ding ding ding. You should have, forget about the
• 14:05
  Suze: kids for a second. You should have for yourselves a
• 14:10
  Suze: living revocable trust, an advanced directive, a durable power of
• 14:13
  Suze: attorney for health care, as well as a financial power
• 14:16
  Suze: of attorney. You really need to look into the must-have docs.
• 14:21
  Suze: Go to musthavedocs.com
• 14:24
  Suze: and check them out. They're $99 for $2,500 worth of
• 14:29
  Suze: state of the art documents that are good in all
• 14:31
  Suze: 50 states. You can update them whenever you want. You
• 14:34
  Suze: can share them with your other members of the family,
• 14:37
  Suze: whatever it may be. Anyway, you need to do that
• 14:41
  Suze: to number one, protect yourselves in case something happens. You
• 14:45
  Suze: never know what can happen, but really, if you have
• 14:49
  Suze: that in place.
• 14:51
  Suze: Then maybe the trust could be the secondary beneficiary on
• 14:56
  Suze: your retirement accounts. Remember, your spouse is always the primary
• 15:00
  Suze: beneficiary on your retirement accounts, but the trust could be
• 15:05
  Suze: the secondary beneficiary where it would say how the kids
• 15:09
  Suze: are taken care of because kids can't inherit money.
• 15:14
  Suze: They're minors. So therefore, if you want to make sure
• 15:19
  Suze: that they're set up financially in case something happens to you,
• 15:24
  Suze: but somebody is in charge of it until they're adults
• 15:28
  Suze: and maybe you'll even set it up depending on how
• 15:30
  Suze: much insurance or whatever you have in there, maybe it
• 15:33
  Suze: is set up so that they don't get this money
• 15:37
  Suze: until they're 25, 35, 45 because you need to be
• 15:42
  Suze: an adult,
• 15:44
  Suze: in every possible way to handle money. All right, KT.
• 15:49
  KT: OK, next question is from Robert. Hi, Suze. We're in
• 15:52
  KT: retirement with some new income from an apartment we are
• 15:56
  KT: renting out. Besides that, our income is Social Security and
• 16:00
  KT: our investments. We do have an emergency fund enough for
• 16:04
  KT: about 10 months of expenses, but we're concerned about the
• 16:09
  KT: possibility of a real
• 16:10
  KT: crash and are wondering if we should take 50% of
• 16:15
  KT: our retirement investments and put it somewhere able to withstand, ready?
• 16:20
  KT: A 1929 or a 2008 level crash, Robert and Liz,
• 16:27
  KT: this is not the first time I've received emails like this.
• 16:30
  KT: People are getting a little nervous.
• 16:32
  Suze: So first, Robert and Liz, let me say this about 2008.
• 16:37
  Suze: That crash happened,
• 16:40
  Suze: because banks were lending on homes that were under water,
• 16:46
  Suze: no money down, it was so crooked how money was
• 16:50
  Suze: being used back then by the financial institutions, and one
• 16:55
  Suze: bank was selling a loan to another bank. They didn't
• 16:59
  Suze: care if you qualified. It was no money down. It
• 17:02
  Suze: was horrific.
• 17:04
  Suze: And that led to the crash. That's not where we
• 17:08
  Suze: are right now. Nobody's doing that anymore, so we're solid
• 17:12
  Suze: on that level, all right, so stop thinking that way.
• 17:17
  Suze: 1929 was a whole other story that's not gonna happen
• 17:22
  Suze: at this point in time again. So just get that
• 17:25
  Suze: out of your head. I don't think we're ever going
• 17:29
  Suze: to have a crash like those crashes. However,
• 17:33
  Suze: that doesn't mean that the market can't go down significantly
• 17:38
  Suze: because something else happens and we don't know what that
• 17:42
  Suze: could be, but that could happen no matter what. So
• 17:46
  Suze: if you are afraid.
• 17:49
  Suze: You're concerned for whatever reason. Nothing I say should make
• 17:55
  Suze: you necessarily feel better because the truth is I don't know.
• 18:00
  Suze: Do we have another September 11th? Do we have a
• 18:03
  Suze: cyber attack? What can happen of the unknown that could
• 18:08
  Suze: really cause everything to freeze up or do whatever? Therefore,
• 18:13
  Suze: you need to do what you need to do to
• 18:16
  Suze: make yourself feel safe and sound.
• 18:19
  Suze: Because the goal of money is for you to be secure,
• 18:22
  Suze: even though I still think these markets and everything have
• 18:25
  Suze: a long way to go. Another year or so, especially
• 18:29
  Suze: in certain areas, I do not think that we are
• 18:32
  Suze: in an AI bubble by any means, and I could
• 18:36
  Suze: go on and on, but what's important here is you
• 18:40
  Suze: have to honor your own thoughts.
• 18:44
  Suze: You have to listen to your own fear about things
• 18:49
  Suze: so only you know what's right for you and whatever
• 18:54
  Suze: decision you make, don't ever spend time thinking about, did
• 18:59
  Suze: I make the right decision, make the decision you made right, period.
• 19:06
  Suze: KT, tell everybody where we got that from my last line.
• 19:10
  KT: So Suze just quoted a Dr. Ellen Langer, who was
• 19:14
  KT: a guest on the Mel Robbins podcast. And we were
• 19:18
  KT: listening to it. We like to take our infrared saunas
• 19:21
  KT: at night and we listen to books or podcasts
• 19:24
  KT: or whatever we think we could learn from. It's very
• 19:27
  KT: relaxing and we just love the thinking of this doctor.
• 19:32
  KT: It's called the Mindful Body. So listen to it if
• 19:36
  KT: you can. It's great.
• 19:36
  Suze: Actually, KT, we learned two really important things from the doctor.
• 19:43
  Suze: The first one was what I just quoted you, everybody,
• 19:46
  Suze: which is don't question whether you made the right decision.
• 19:52
  Suze: Make every decision you make right. We thought that was brilliant.
• 19:56
  Suze: And the second one that we loved among others, was
• 20:01
  Suze: rather than adding more years in your life, add more
• 20:05
  Suze: life to your years.
• 20:08
  Suze: And KT and I especially at our age right now,
• 20:11
  Suze: really love that one that one. So that's where that
• 20:16
  Suze: came from.
• 20:16
  KT: Yeah, Doctor Langer, that's our favorite, and we live by that.
• 20:20
  KT: We add life to our years.
• 20:22
  Suze: All right, go on.
• 20:24
  KT: All right, so.
• 20:25
  KT: This next question, I currently have $515,000 invested in a
• 20:31
  KT: taxable brokerage account all in the Fidelity Total Stock market
• 20:35
  KT: index fund. I'm 59 years old, and I think it's
• 20:39
  KT: time to cash this position out and put the money
• 20:43
  KT: in a safer investment.
• 20:45
  KT: See, Suze, people are getting skittish, John said. I spoke
• 20:48
  KT: to my accountant. He advised me, ready? To cash half
• 20:52
  KT: of the fund out this December and the balance right
• 20:57
  KT: after the first of January. My question is, do you
• 21:00
  KT: have any suggestions on safer investments other than equities?
• 21:06
  KT: And there you go. So John gave you a summary
• 21:09
  KT: of what he's got, but I think again people are nervous, Suze.
• 21:15
  KT: A lot of um jittery people out there.
• 21:18
  Suze: Well, John, I have to tell you.
• 21:21
  Suze: I don't think the advice that you got from your
• 21:23
  Suze: accountant is the best advice at all. And here is
• 21:27
  Suze: the reason why, KT just gave me your email.
• 21:32
  Suze: The $515,000 everybody, listen to me closely.
• 21:37
  Suze: The $515,000 that John has invested is in a taxable
• 21:44
  Suze: brokerage account in the total stock market index. OK. Over
• 21:50
  Suze: the past year, two or three that has gone up considerably.
• 21:55
  Suze: Even if he sells half this year and half next year,
• 22:01
  Suze: he's gonna owe taxes on that money. That means his
• 22:07
  Suze: taxes that he paid is no longer available for him
• 22:12
  Suze: to compound or invest. It's out because he's paid taxes
• 22:16
  Suze: on it.
• 22:17
  Suze: Now he's reinvesting that money in something that's also going
• 22:21
  Suze: to be taxable. What could he do instead? John, you
• 22:27
  Suze: have in your 401k, not a Roth 401k, in your
• 22:33
  Suze: traditional 401k, $450,000.
• 22:40
  Suze: If it were me advising you, I would have told you, listen,
• 22:45
  Suze: if you want to become more conservative, you have to
• 22:49
  Suze: look at your money as a whole.
• 22:52
  Suze: Where can you take money out that you don't have
• 22:55
  Suze: to pay taxes on?
• 22:58
  Suze: And in the future it would even help you more
• 23:00
  Suze: if it didn't grow that much, and that would be
• 23:04
  Suze: your 401k because when you go to take money out
• 23:08
  Suze: of your 401k, number one, it's going to be ordinary
• 23:12
  Suze: income taxed. Next you're going to owe RMDs on that money. Therefore,
• 23:19
  Suze: if I were you, I would come out of the
• 23:21
  Suze: market with the 401k.
• 23:25
  Suze: If you're going to quit your job, OK, or whatever,
• 23:28
  Suze: you can then do an IRA roll over with that money,
• 23:32
  Suze: no taxes. Put it in treasuries, do whatever you want
• 23:35
  Suze: with it to keep it safe and sound, so that
• 23:38
  Suze: it's good, but guess what? You never pay taxes on it.
• 23:42
  Suze: And there you go, you accomplished the diversification but didn't
• 23:47
  Suze: have to pay taxes and therefore you could just let
• 23:51
  Suze: the 515,000 in the total stock market index ride because
• 23:57
  Suze: it's going to go up most likely. It's a great
• 23:59
  Suze: place to be diversified. You're doing exactly what you should do.
• 24:04
  Suze: The rest of your money, the Roth IRA, fabulous.
• 24:09
  Suze: You don't have to worry about taxes there, but if
• 24:11
  Suze: it were me, I would use the money in the
• 24:14
  Suze: 401k plan and not do what your accountant told you
• 24:18
  Suze: to do. All right.
• 24:20
  KT: So this next question is from Orhan. It's an interesting name,
• 24:24
  KT: isn't it? Orhan.
• 24:26
  KT: Been a listener for years and thank you both for
• 24:29
  KT: all the knowledge you give us. I turned 73 on
• 24:33
  KT: the last day of 2026, December 31st. Wow, that's a new...
• 24:39
  Suze: This is going to be your
• 24:40
  Suze: pop quizzy.
• 24:41
  KT: All right. Is my RMD calculated on the total traditional
• 24:48
  KT: IRA's value as of December 31, 2025 and
• 24:55
  KT: can I or must I access my RMD throughout the
• 24:59
  KT: entire 2026 year even though I don't turn 73 until
• 25:05
  KT: the last day of the year? I don't know what
• 25:08
  KT: to take out. Two RMDs in 2027. Thank you.
• 25:14
  Suze: Pop quizzy.
• 25:17
  KT: All right, so, he's turning 73 on the last day of December.
• 25:23
  KT: I think he only needs to take one RMD.
• 25:25
  Suze: But he's not turning 73 to the last day of 2026.
• 25:32
  Suze: Can he? The first question, can he before he turns
• 25:38
  Suze: 73 anytime in that year,
• 25:42
  Suze: can he take out his RMD before he turns 73
• 25:47
  Suze: to satisfy the RMD for 2026? Yes or no?
• 25:55
  KT: Ohh.
• 25:59
  KT: All right, KT, this is gonna be a guess. I'm guessing.
• 26:04
  KT: I think that he had, he can pass. I think
• 26:06
  KT: you get a little grace period and he can do
• 26:08
  KT: it in 27.
• 26:10
  Suze: If he does it in '27, however, because he turned 73
• 26:16
  Suze: in '26...
• 26:17
  KT: On December 31st on the
• 26:19
  KT: last day.
• 26:19
  Suze: If he takes it out in '27, he's gonna have
• 26:23
  Suze: to take out two,
• 26:25
  Suze: in '27, one for 26 and one for '27. So
• 26:30
  Suze: now he subjected himself to two RMDs in 2027. Is
• 26:38
  Suze: that his only alternative? Yes or no?
• 26:41
  KT: I don't think it's his only alternative.
• 26:43
  Suze: So what else could he do? He has to take
• 26:45
  Suze: two out.
• 26:46
  KT: Yeah,
• 26:47
  Suze: So... (Suze makes the wrong answer sound)
• 26:49
  KT: I think, no, I said you get a grace period.
• 26:51
  Suze: You don't get a grace period.
• 26:53
  Suze: You don't?
• 26:54
  Suze: No.
• 26:55
  KT: So, so what did I do wrong?
• 26:57
  Suze: You don't know the rules, and I'm gonna tell you
• 27:00
  Suze: the rules. That's all you did wrong, my love. So
• 27:03
  Suze: listen to me, everybody.
• 27:06
  Suze: Your RMDs are based on the value of your account
• 27:12
  Suze: on December 31st, the year before
• 27:17
  Suze: you turn 73, so in this case it will be
• 27:21
  Suze: based on December 31st, 2025. Since it's based on that
• 27:28
  Suze: amount and that's not going to change because that is
• 27:32
  Suze: the amount he is allowed to take out an RMD
• 27:37
  Suze: any time during 2026, even though when he takes it out,
• 27:44
  Suze: he may not be 73 yet, but because he's going
• 27:48
  Suze: to be 73 in 2026, the last day, he can
• 27:53
  Suze: take one RMD out in 2026.
• 27:58
  Suze: And another one then when he wants to in 2027
• 28:03
  Suze: and that one will be based on the ending value
• 28:07
  Suze: of his account on December 31, 2026. That's how he
• 28:13
  Suze: would do it just so you know, you never want
• 28:16
  Suze: to subject yourself, KT, to two RMDs. You do not
• 28:21
  Suze: listen closely to me, KT, when you take out a
• 28:24
  Suze: required minimum distribution.
• 28:27
  Suze: You have to take it out by April 1st after
• 28:32
  Suze: the year you turn 73, OK? If you do that.
• 28:39
  Suze: Doesn't mean that you're postponing the next one, you'll have
• 28:42
  Suze: to take out two that year, the one you should
• 28:45
  Suze: have taken out for '26 that you postponed till '27.
• 28:49
  Suze: And the one that you should have taken out as
• 28:52
  Suze: well in '27, so you never ever want to postpone.
• 28:56
  Suze: Unless you know you're going to be in a really 0%
• 28:59
  Suze: tax bracket, you want to take your RMD in the
• 29:04
  Suze: year you turn RMD age. And for those of you
• 29:09
  Suze: born 1960 or later, you're not going to have to
• 29:12
  Suze: do it till you're 75.
• 29:17
  KT: All right, that is a wrap.
• 29:19
  Suze: So we hope you enjoyed
• 29:22
  Suze: our Ask KT and Suze, anything vacation edition.
• 29:27
  KT: Let's go eat some pasta.
• 29:29
  Suze: I'm sure we will be at this point in time, right?
• 29:33
  Suze: But anyway, there's only one thing that we want you
• 29:36
  Suze: to remember when it comes to your.
• 29:38
  Suze: Money and what is that KT?
• 29:40
  KT: People first, then money, then things.
• 29:45
  Suze: Now you stay safe and go to youtube.com/ Suze Orman and subscribe.
• 29:51
  Suze: See you soon. Bye-bye.