IRA

Should I Do a Backdoor Roth?

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We kick things off this week with one of the more popular questions we receive: Does it make sense for me to do a backdoor Roth IRA?

Some times it’s a no-brainer, but there are definitely some factors that need to be considered. That’s the conversation in the first segment with Jeff from Chicago.

Next up was Chelsea from North Carolina with a question about when it makes sense to take advantage of post-tax retirement contributions.

Digital minimalists are all around us. They're the calm, happy people who can hold long conversations without furtive glances at their phones. They can get lost in a good book, a woodworking project, or a leisurely morning run. They can have fun with friends and family without the obsessive urge to document the experience. They stay informed about the news of the day, but don't feel overwhelmed by it. They don't experience "fear of missing out" because they already know which activities provide them meaning and satisfaction.

Man oh man, that is music to my ears! That’s why I’m so excited about our guest this week in hour two, Cal Newport, with us to talk about his latest book, Digital Minimalism: Choosing a Focused Life in a Noisy World.

Newport gives us a name for this quiet movement, and makes a persuasive case for its urgency in our tech-saturated world. Common sense tips, like turning off notifications, or occasional rituals like observing a digital sabbath, don't go far enough in helping us take back control of our technological lives, and attempts to unplug completely are complicated by the demands of family, friends and work. What we need instead is a thoughtful method to decide what tools to use, for what purposes, and under what conditions.

Drawing on a diverse array of real-life examples, from Amish farmers to harried parents to Silicon Valley programmers, Newport identifies the common practices of digital minimalists and the ideas that underpin them. He shows how digital minimalists are rethinking their relationship to social media, rediscovering the pleasures of the offline world, and reconnecting with their inner selves through regular periods of solitude.

Technology is intrinsically neither good nor bad. The key is using it to support your goals and values, rather than letting it use you. This book shows the way.

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Roth Conversion and Rent vs Buy

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We start the show this weekend with a call from Mike in the midwest who is wondering if it makes sense to start converting some of his traditional IRA money into a Roth.

Next up was Alan from the Bay Area with a question that never gets old: should I rent or should I buy? That’s the decision facing Alan and his wife.

The recent trend continues as hour two is nothing but emails as we continue to dig out from an overflowing inbox.

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Should I Do a Roth Conversion?

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When you leave a job, odds are you're going to have an old retirement plan out there. What should you do with it? You can usually leave it where it is, or roll it over into a traditional IRA, or, if the dollars are pre-tax contributions, consider converting it to a Roth IRA. That's the discussion on the latest call with Matt from Maryland.

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Should I Do a Roth Conversion

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This week we're chatting with Laurie from Salt Lake City who wants to know if it makes sense to start converting some of her traditional IRA into a Roth.

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Roth IRA Conversion and Year-End Money Tips

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We kicked things off this week with Mike from Minneapolis. With a lot saved in tax deferred accounts, Mike is wondering if it makes sense to start converting some of the money into a Roth IRA? Sounds like a great idea, but there's a caveat.

Next up was Monica from Brooklyn, NY. She's only in her 30s, but Monica is absolutely killing it. Probably one of the top ten calls of 2018. Enjoy!

December is upon us, which means I basically have your attention for about another week or so.

After that, let’s face it, we’re all checking out for the rest of 2018.

So while I have you, and as the year comes to an end, it's a perfect time to review some year-end financial planning tips.

For such an occasion there's no better duo than Michael Goodman and Brenna McLoughlin from Wealthstream Advisors. And in the interest of full disclosure, not only is Michael a dear friend of mine, he's also my advisor.

We discussed a variety of financial planning topics to ponder before you shut down for the holidays, including:

Selling assets in your portfolio now versus waiting until next year: Losses offset gains that you have taken previously in the year; if you have more losses than gains, you can deduct up to $3,000 of losses against ordinary income.

Take Required Minimum Distributions: Generally, once you turn 70 1/2, you must begin withdrawing a specific amount of money from your retirement assets (there are some exceptions). The penalty for not taking your RMD is steep at 50 percent on the shortfall!

Consider a Qualified Charitable Distribution (QCD): One way to sidestep the taxation on your RMD is to make a Qualified Charitable Distribution, which allows you to gift directly from your IRA to a charity without having to include the distribution in your taxable income.

Making last minute 529 plan contributions: Money saved in these programs grows tax-free and withdrawals used to pay for college sidestep taxes, too. You can invest up to $15,000 in 2018 without incurring a federal gift tax and many states offer state tax deductions for the contributions.

Considering how tax changes could affect you: With all the changes to the tax code, there’s plenty of items to keep in mind before filing your 2018 returns.

So before you completely shut it down and wrap up your 2018 finances, you’ll want to listen to this episode to make sure there’s nothing you’re forgetting.

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My Book, IRA Contributions and Rescuing Retirement

Okay, it’s time for a BIG announcement. My very first book, The Dumb Things Smart People Do with Their Money, is now available for pre-order!!

Do you have a “friend” who is super smart, has a great career, holds a graduate degree, has even saved a chunk of money for retirement, but who keeps making the same dumb mistakes when it comes to money? Is this “friend” you?

The book reveals thirteen costly mistakes you’re probably making right now with your money without even knowing it. Drawing on heartfelt personal stories (yes, money experts screw up, too), I argue that it’s not lack of smarts that causes even the brightest, most accomplished people among us to behave like financial dumb-asses, but simple emotional blind spots.

Click here for all the info on how and where to place your order. Thank you for the support!!

Now on to the latest radio show where we kicked things off with Virginia from Buffalo who is trying to solve a good problem. When is it time to stop contributing to her IRAs? Is there such a thing as having too much saved?

At a time when Congress can’t seem to agree on much, lawmakers are acknowledging that the main retirement savings vehicle, the 401(k), needs some fixing. Before you get too excited, the changes being considered are more like touch ups, rather than a complete renovation.

Early conversations include: requiring plan sponsors to let participants know how much their total savings would translate into monthly income; a repeal of the age limit on IRA contributions; a more liberal approach to pooled 401(k) plans, which would help more small businesses offer retirement benefits to their employees; and the option to use a portion of a tax refund to fund retirement.

While none of these ideas represents a game-changer for retirement savers, it would be the first major enhancement since 2006. But if lawmakers wanted to seek a more radical approach, they would consult with Teresa Ghilarducci and Tony James, co-authors of Rescuing Retirement: A Plan to Guarantee Retirement Security for All Americans, who claim that "The U.S. experiment with 401(k)s and IRAs, launched in the early 1980s, has failed miserably to deliver on its promises."

Ghilarducci, a labor economist and leading expert in retirement security, and James, Executive Vice Chairman of the investment firm Blackstone Group, have a detailed, well-researched and more extreme recommendation for rescuing the U.S. retirement system. It starts with a concept called a “Guaranteed Retirement Account” (“GRA”), which would be offered to every worker, "from Uber drivers to CEOs."

The GRA would be portable, whether you work for a number of different companies or for yourself – and each individual would control his or her account. It would be funded by a minimum 3 percent of salary, half contributed by the worker and half by the employer.

Perhaps the most interesting part of the GRA is that it fixes some of the big problems that are prevalent in current plans, the biggest of which is that right now, saving for retirement is voluntary. The GRA would mandate retirement savings for everyone, including those who work part-time or are self-employed.

If it all sounds too good to be true, I encourage you to check out the book. I was a cynic, but after reading it and interviewing Ghilarducci and James, I’m a convert.

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Rescuing Retirement with Teresa Ghilarducci and Tony James

At a time when Congress can’t seem to agree on much, lawmakers are acknowledging that the main retirement savings vehicle, the 401(k), needs some fixing. Before you get too excited, the changes being considered are more like touch ups, rather than a complete renovation.

Early conversations include: requiring plan sponsors to let participants know how much their total savings would translate into monthly income; a repeal of the age limit on IRA contributions; a more liberal approach to pooled 401(k) plans, which would help more small businesses offer retirement benefits to their employees; and the option to use a portion of a tax refund to fund retirement.

While none of these ideas represents a game-changer for retirement savers, it would be the first major enhancement since 2006. But if lawmakers wanted to seek a more radical approach, they would consult with Teresa Ghilarducci and Tony James, co-authors of Rescuing Retirement: A Plan to Guarantee Retirement Security for All Americans, who claim that "The U.S. experiment with 401(k)s and IRAs, launched in the early 1980s, has failed miserably to deliver on its promises."

Ghilarducci, a labor economist and leading expert in retirement security, and James, Executive Vice Chairman of the investment firm Blackstone Group, have a detailed, well-researched and more extreme recommendation for rescuing the U.S. retirement system. It starts with a concept called a “Guaranteed Retirement Account” (“GRA”), which would be offered to every worker, "from Uber drivers to CEOs."

The GRA would be portable, whether you work for a number of different companies or for yourself – and each individual would control his or her account. It would be funded by a minimum 3 percent of salary, half contributed by the worker and half by the employer.

Perhaps the most interesting part of the GRA is that it fixes some of the big problems that are prevalent in current plans, the biggest of which is that right now, saving for retirement is voluntary. The GRA would mandate retirement savings for everyone, including those who work part-time or are self-employed.

If it all sounds too good to be true, I encourage you to check out the book. I was a cynic, but after reading it and interviewing Ghilarducci and James, I’m a convert.

“Better Off” is sponsored by Betterment.

Have a money question? Email me here or call 855-411-JILL.

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"Better Off" theme music is by Joel Goodman, www.joelgoodman.com.

Can Congress Fix the 401(k)?

Can Congress Fix the 401(k)?

At a time when Congress can’t seem to agree on much, lawmakers are acknowledging that the main retirement savings vehicle, the 401(k), needs some fixing. Before you get too excited, the changes being considered are more like touch ups, rather than a complete renovation.

What to Do With Your Old Retirement Plan

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We've all been there. Leaving one job and starting another. But what should you do with your retirement account at the old place? That's the question from Nate on the latest BONUS call.

“Better Off” is sponsored by Betterment.

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Student Loans, Debt Consolidation, Roth IRA

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Should I refinance my student loans? Is debt consolidation the best option? Should I be using a Roth IRA? Those are the latest questions we answered as we attempt to clear out the inbox!

“Better Off” is sponsored by Betterment.

Have a money question? Email me here or call 855-411-JILL.

We love feedback so please subscribe and leave us a rating or review in Apple Podcasts!

Connect with me at these places for all my content:

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