Radio Show #113: Kentucky Derby, Roth IRA


It’s Derby weekend on the show—we have no idea which horse will win, but we can make one great bet: keep those expenses down with index funds and you are sure to see a bigger pay-off!

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Dick and Jim each had questions about paying for financial advice. As I have said, while many people have the time, expertise and temperament to manage their own money, many others do not. To explore fee-only advisors, who have to put your needs first and do not collect any commissions, go to

Retirement and allocation questions from John, Phillip, Mary and Jim were opportunities to review some good rules of thumb: keep company stock allocation to 5 to 10 percent of the total portfolio value; maintain an adequate emergency reserve fund (at least 12 months of living expenses); whether I-Bonds make sense as a hedge against future inflation; and how to calculate consistent retirement income (multiply total portfolio value at retirement by 3.5 percent).

Sonya’s question about a Roth IRA conversation led to a discussion of IRS Rule 72-T. This rule allows IRA owners to avoid the early withdrawal penalties if: (1) Distributions are established as substantially equal periodic payments; (2) the payment schedule is continued for five years or until the account owner reaches age 59½, whichever is longer; and (3) the withdrawal amount is calculated using one of three IRS-approved life expectancy determination methods (life expectancy, annuity, amortization). You can check out this 72-T calculator from

How can you access money from a variable annuity? Listen to my conversation with Rosie and you can learn how!

Thanks to everyone who participated and to Mark, the BEST producer in the world. If you have a financial question, there are lots of ways to contact us:

  • Call 855-411-JILL and we'll schedule time to get you on the show LIVE