Radio Show #129: Brazil, financial advisors


Just back from a quick trip to Brazil and happy to get right back into the groove with questions from the smartest fans around!

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Kathy from MD started asked a question about re-titling an old stock certificate. We dealt with that quickly, before moving into the thornier topic of how to convince an aging parent to draft a will.

Cheryl from NC, Anne from PA and Barb from OR each asked a question about their respective advisors. If Cheryl’s case, she needs to go back to the advisor/broker to better understand the terms of the new asset management fund. Anne needs to tell her advisor that they want to maintain a separate account with stocks that he will not manage and that the risk of her managed account may need to be adjusted to compensate for that fact. For Barb, it’s time to dump her bank-based advisor and find a fee-only (use or a fee-based advisor.

Ron from IL checked in with a question about IRS Rule 72T, which allows access to 401(k) funds before age 59 ½, without the early withdrawal penalty.

Jack from CA and is busy trying to pay down $180K in student loans, while Carl is preparing to assume new debt for college and wants to know appropriate parameters that he should use before starting the process.

Kathryn wrote in to warn against a refinancing scam that is aimed at veterans (ugh!) If any listeners encounter these types of horrible hoaxes, please let me know so we can help spread the word!

We fielded a bunch of Social Security questions from Mark, Janis, Max, Ben, Christopher, Ray, Larry and Lowell. As a reminder, the procedure to calculate benefits involves three steps.

1. A worker’s previous earnings are restated in terms of today’s wages to reflect wage growth.

2. Earnings for the highest 35 years are averaged and divided by 12 to arrive at Average Indexed Monthly Earnings (AIME).

3. The Social Security benefit formula is applied to AIME to produce the Primary Insurance Amount (PIA), the benefit payable at the Full Retirement Age (FRA).

If you have less than 35 years of earnings, you may want to work enough additional years so you have a full 35 years of earnings. Otherwise, the Social Security Administration will average in zeros for any years less than 35.

The maximum SS benefit depends on the age you retire. If you retire at your full retirement age in 2013, your maximum benefit would be $2,533.  If you retire at age 62 in 2013, your maximum benefit would be $1,923. If you retire at age 70 in 2013, your maximum benefit would be $3,350.

Tony asked how many months out of the year are required for state residence and Alan from Buffalo needed help with debt pay down options.

Dave in St Paul, MN asked about a bond fund versus a stable value fund and whether to use retirement assets to build a house.

Thanks to everyone who participated and to Mark, the BEST producer in the world and Christina the intern. 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