Afford Anything

Tag: sep IRA

By Paula Pant

#330: Ask Paula: How Do I Know If I’m Ready to Retire?

Linda is 58 and wondering how to account for her Social Security benefits when thinking through the 25x expenditure equation. Her expected expenses are $100,000 – $150,000. How can she figure out if she’s ready to retire?

Mr. Man is eligible to retire with a full pension, health benefits, and social security at age 48. He has 20 years to go. Should he include his pension and social security benefits in his financial independence plan, or think of them as extras?

“Timothy,” a lawyer from Colorado, has $250,000 in a SEP-IRA account that’s invested in mutual funds with fees ranging from 0.61 percent to 1.06 percent. Fees on these funds are projected at $200,000 over the next 20 years. Should he and can he transfer these funds to another SEP-IRA account? What are the consequences of doing that?

Alise has dreamed of living abroad for long periods of time and wants to buy a property in Portugal before the minimum spend requirement increases. Should she go through with this, or is there another way to gain dual citizenship or travel abroad for long periods of time?

Former financial planner Joe Saul-Sehy joins me to answer more of your questions.

Do you have a question on business, money, trade-offs, financial independence strategies, travel, or investing? Leave it here and we’ll answer them in a future episode.

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By Paula Pant

#318: Ask Paula – How to Think About Finances at the 30,000-Foot Level

Kim is newly divorced and celebrating the freedom to make her own financial decisions. She’s struggling to make a living — also as a new realtor — and wants to get started with real estate…but how can she do that on limited funds?

Kim also wants to know: should she move her funds from an actively managed Fidelity IRA to a Vanguard Roth IRA?

Chaz is 22 and has $2,100 – $2,500 left each month to put toward savings. Where should he keep this money if he’d like to move out-of-state in the near future?

Joe is a new real estate agent and he’s looking for ways to save. Is opening a SEP IRA a good account when you’re no longer a W2 employee?

Grace has a similar concern: she’s a tutor, but she’s paid as a contractor. Should she forget about her Vanguard brokerage account and open a SEP IRA or Solo 401k?

Anonymous just got a raise, and while awesome, it might push her income to a level that prohibits her from making full Roth IRA contributions. Should she make a partial contribution this year, or start adding money to a Traditional IRA to do a backdoor conversion?

My friend and former financial planner, Joe Saul-Sehy, joins me to tackle these questions. Let’s dive in!

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By Paula Pant

#229: Ask Paula – Help! My Mom or Dad Took Out a Credit Card in My Name. Am I On the Hook?

Helen discovered that her mother fraudulently opened credit card accounts in her name. Eek! How can she protect herself? What will happen to these accounts once her mother passes away?

Amelia and her husband cannot fire their financial advisor. How can they minimize the damage and maximize the benefit they receive from him in the meantime?

Anonymous asks if she should live off an inheritance and max out her 401k contributions during her first year of working full-time. She wants to reduce her taxable income. Is this a good idea?

A different anonymous caller read a USA Today article claiming that “index funds are in a bubble.” How true is this? How can index funds be in a bubble?

Shawn is self-employed. He invests in a Solo 401k that features both a Roth and Traditional component. How should he manage this account?

Another anonymous listener is thinking about downshifting to part-time work. He holds around $278,000 in home equity. How can he capitalize on this?

Former financial planner Joe Saul-Sehy and I answer these questions on today’s episode. Enjoy!

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By Paula Pant

#197: Ask Paula – Traditional IRA vs. Roth IRA — What Should I Choose?

Should Bret invest in a Traditional IRA or a Roth IRA?

If Amanda gets married, how will her child support be affected? What about her student loan forgiveness?

Joe is investing in bonds, which average a rate of return that’s equal to the interest rate on his mortgage. Should he switch to all-equities and redirect his bond investments into mortgage payoff, instead?

Taunia has a car loan, a 401k loan, a home improvement loan, a primary mortgage, and a second mortgage. She also has an emergency fund that only covers two months of expenses, and she’s trying to save for college for her two children. What should she prioritize?

Mickey has a six-month emergency fund. Should he leave it in a savings account or invest in bond ladders?

David made $10,000 from a side hustle last year. Can he open a Solo 401k or SEP-IRA for his side hustle business? If so, which one should he choose?

Should Andy invest in a Target Retirement Date fund, or should he split his money between a U.S. index fund and an international index fund?

Former financial planner Joe Saul-Sehy and I answer these seven questions in today’s episode.

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By Paula Pant

#193: Ask Paula – I Spent Ten Years in School, and Now I’m Behind on Retirement Savings

Lori is behind on retirement savings, as a result of being a full-time student for more than a decade. She makes good money and lives frugally, but she’s aware that she’s behind for her age. What should she do?

Sierra wonders whether she should apply her savings towards paying off her mortgage or building investments.

Jenessa plans to retire at age 35, and she’s wondering if the 4 percent withdrawal rule applies for such a long time horizon. Her friend swears that it’s designed to cover a 30-year retirement, not a 60+ year retirement. Is that correct?

Jacqui is 24 and recently married. She’d like to open a 529 College Savings Plan for her future children, which she doesn’t plan on having for another 8 to 10 years. Should she do this?

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By Paula Pant

#122: Ask Paula – I’d Like to Airbnb a Yurt. Should I?

Tony lives in Chicago, where the returns on rental properties are so-so. He’s thinking about investing in Indianapolis, where he consistently finds rental properties with cap rates that are greater than 8 percent. Should he invest locally, so that he can get a primary residence mortgage and keep a closer eye on the space? […]

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Afford Anything