Sara is five years from retirement with a paid-off house. But she’s worried that her money will run out before she turns 80. What does she need to do now to protect her future self?
Lauren is a personal finance nerd who gets it. But one question perplexes her: When should she choose an ETF over an index mutual fund? What about vice versa? Paula and Joe explain.
An anonymous caller plans to sell her house and live a “slow-madic” lifestyle. But she’s on disability and needs to keep her money safe. How should she invest her $500,000 windfall?
Former financial planner Joe Saul-Sehy and I tackle these three questions in today’s episode.
Enjoy!
P.S. Got a question? Leave it here.
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Sara asks (at 01:28 minutes): I’m 60 and want to retire in five years, but I’m worried my money will run out before I’m 80. What do I need to do to avoid that?
My house is paid off, but it needs a remodel which will cost at least $65,000. I make $35,000 annually, and my social security benefit after retirement will be $1,000 monthly.
I have $250,000 invested between my brokerage and IRA accounts. And I have $250,000 saved in a Certificate of Deposit (CD) account earning 5 percent interest.
My three children are grown and no longer live with me. I love to travel and plan to leave the house when I retire.
Am I on track for retirement at 65 or do I need to add a part-time job to maximize my income? Should I adjust my retirement investments to 70 percent stocks and 30 percent bonds?
Lauren asks (at 24:13 minutes): I have a pretty solid handle on personal finances, but I don’t understand the difference between index mutual funds and exchange-traded funds (ETFs).
I have $190,000 in a 401k, $63,000 in a Health Savings Account (HSA), $190,000 in an IRA, and $160,000 in a taxable brokerage account invested mostly in S&P 500 index funds.
Is there a benefit to switching to an ETF equivalent for any of my accounts? Does it vary by account type?
Anonymous asks (at 41:42 minutes): I’m about to sell my paid-off home for $500,000 so that I can move around like a “slow-mad”. How should I invest the windfall to best support my lifestyle?
I’m on disability and don’t plan to buy another home for a while. It’s hard for me to travel but if I do it carefully, I’m able to cater to my needs without having a flare-up with my disability.
I successfully did a test run last year, so I’m confident this is the right decision for me. What kind of safe and diversified investments would you suggest for me?
Resources Mentioned:
Benefit Calculators | Website
How One Ex-Inmate is Building a Better Future | Podcast
What is efficient frontier? | Website
Asset Allocation Portfolios | Website
Asset Allocation Portfolios | Morningstar | Website
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