TRANSCRIPT FOR THE JUNE 11, 2016 “ON THE MONEY” SHOW

Hosts: Judith Sanborn, CFP®, AIF® and Joe Bert, CFP®, AIF®

Central Florida’s oldest and largest independent firm of certified financial planning professionals. It is the Certified Financial Group in Altamonte Springs, and for over 30 years? 30 years —  Wow.

Maybe 20,000 plus shows or something like that. The Certified —

We need to go back and see when Jeff Slater was here in the mornings, that’s when I started. Remember Jeff Slater?

Of course I do. I was his producer.

Well there you go, go back and look at the record.

We will. We’ll figure that out.

That’s from the ’80s.

So like the last umpteen.

Umpteen!

Years, Joe Bert, the Oracle of Orlando, and his colleagues from the Certified Financial Group have been coming in to give you sound financial advice every Saturday morning at 9:00, we call it On The Money, and this morning is no exception as we welcome Judi Sanborn, also a certified financial planning professional, and the Oracle of Orlando, as you hear, he’s back in the studio in fine form, how are you all?

Doing great, good to be here.

Good, fine.

Is it really?

That time of year.

<Inaudible>.

Summer starts here soon.

There we go. Joe, in case anybody may be new to the program, what do you all take calls about?

Once again, Judi and I are here to answer any questions that might be on your mind regarding your personal finances, trying to clear up that financial life. People go through life trying some of this, trying some of that, and wake one day, jeez, we’ve got to retire or the jobs stop. Where is the money going to come from? How do we pay the bills? How do enjoy life? How do we take those vacations that we want to do and spend time with the grandkids and all that stuff, and that’s what financial planning and retirement planning is all about, and Judi and I and the 10 other colleagues at Certified Financial Group do this for a fee during the week, but on Saturday morning, as we like to say, we do it for free, so we’ll take questions that might be on your mind regarding your personal finances, and often times revolves around questions that you have on stocks and bonds, mutual funds, real estate, long-term healthcare, IRAs, annuities, reverse mortgages, all that and more. Judi and I are here to take your calls, and the good news for you, if you have any questions, there is absolutely no one in line so there’s no waiting this morning. All you have to do is pick up the phone and dial —

844-220-0965. 844-220-0965. You can also send us a short text from your mobile device. That texting number is 21232, or if you so desire, you can become part of the program with your voice, use the open mic feature that you will find on the News 96.5 app. Some of the things we’re going to talk about today are required minimum distributions, and Judi, I did not know this, but — Judi brought this to my attention this morning. The first Boomers are turning 70 and a half in July, and what happens when you’re 70 and a half?

Oh remember those birthdays that I talk about, those several birthdays that you’re going to hate to love? Well, I think this is the last of them, and when you’re 70 and a half you have to begin taking what’s called required minimum distributions.

Also known as RMDs.

Also known as RMDs, and you have to take those from your IRAs, your individual retirement accounts, your 401(k)s if you have left employment but you have left your 401(k) at your former employer. If you’re still employed then you don’t have to take it until you leave the employment. You do not have to take this from your Roth IRAs, but you do have to take it from a Roth 401(k) or an inherited Roth.

So what do you do?

So, well —

What does it look — what’s it look like?

What does it look like? If you turn 70 between January 1st and June 30th — Joe corrected me, I said June 31st, but June 30th this year, then you have until April 1st of next year to take your first required minimum distribution. After that, you have to take it every year by December 31st. So you look at the value of all of your IRAs.

Total them all up.

Total them all up.

Okay, one, two, twenty-five, you just create a grand total.

Correct. And the IRS has a table that you can use that has a factor and you take the value of the — December 31st — divide it by that factor, and that will tell you how much you have to take in that time period, and you can choose to take that from any of your IRAs.

So you don’t have to take it from each one.

Right.

Let’s say I have $1M, right, and I just look at one account and I say I’m going to take all my money out of one account as opposed to what I need to take out of four or five or six.

Right. Now, the exception to that is, if you have an inherited IRA, which you do have to take required minimum distributions from, you have to take the required minimum distribution from that IRA, and if you have a 401(k) that you’ve left at a former employer, you have to take the required minimum distribution from that 401(k).

Right.

You can’t take it form —

It makes sense to roll that 401(k) into an IRA, kind of get it in one bucket, and then so you know <Inaudible> going forward because if you don’t the penalty is what?

50%. Huge.

Wow!

Plus taxes.

Plus taxes, exactly.

Yeah.

Because of course — that’s a good point, when you take this required minimum distribution, it’s taxable 100% as ordinary income. So, that is important when you make a decision on your first one if you wait until April 1st of next year, you have to take two next year instead of just the one, so I always recommend to my clients that the year they turn 70 and a half they take it in that year.

Unless you were working for part of the year and you had a lot of income.

True.

So you may want to look at what your tax is, <Inaudible> going to be, and maybe, just maybe it makes sense to delay that first one until April 1st. But what you say, you get one shot to delay it, and that’s it.

That’s it.

<Inaudible> so if you were born after July 1st, 1946.

Yes, so let’s confuse you further.

Mmh.

If you were born — because now you will not turn 70 and a half until next year, and so you will have, if you choose, you will have until April 1st of 2018 to take your first RMD.

First one.

First RMD.

That’s it.

But again, you would have to take two in 2018.

In the first year.

I’ve got a question. If you don’t have somebody helping you out, let’s say like I don’t have the Certified Financial Group in my corner helping me out with all of these plans and I’m trying to manage them, juggle them all myself, do these plans let you know that you have to take these RMDs?

Typically the custodian of your IRA will let you know, but I think I wouldn’t depend on that totally. I think everybody needs to take some responsibility and because there is such a huge number turning 70 and a half this year then perhaps more and more the custodians and the banks, if you have your IRA at the bank, would probably let you know; however, I did have a situation where the custodian — it was an inherited IRA, actually, and the custodian kept sending the person letters and the person totally ignored the letters. So if you start receiving letters from your custodian that you typically perhaps decide is junk mail, and you’re going to be 70 and a half, I would encourage you to open it and look at what it’s trying to communicate to you. I think that’s important.

And, good news for you, if you want to know how much you have to take out of your account, you can go to our website. Go to financialgroup.com, financialgroup.com, and click on tools, and there’s calculators there which will help you calculate the amount you have to withdraw.

It’s coming up on 9:15, a quarter past 9:00 on News 96.5 WDBO. Dave Wall is in the News Center. He’ll be joining us in five minutes with the top three stories we need to know about. One of them, there was a terrible murder last night at the Plaza concert venue. The artist was murdered. Dave Wall will have more on that coming up. Let’s talk to Jim here in Lake Mary. Good morning, Jim.

Good morning, Jim.

Good morning Joe and Judith — or Judi.

Yes.

My question — I’ve never been able to get an answer. I’m not a financial person. But I have some mutual funds, and I let them just grow over years and years and years, but I’ve always wondered now that I’m getting older, why every year I have to pay <Inaudible> pay taxes on them, and it’s imaginary money, I never saw any of it, and I lose and then I make, but why can’t you wait like an IRA until you sell the mutual fund, then pay the taxes? Maybe you can explain it because I’ve tried to get people to explain it, I’d understand why. I’m not touching it, I’m not making anything, why do I have to pay taxes on it?

Well, that’s a great question, and a question that we get all the time, and it’s a controversial question, especially in the down markets because often times you may have had this experience where your fund actually loses money, but you’re still required to pay capital gains on it if you get a capital gain distribution or interest, some type of tax on your dividends. So, the reason is that mutual fund — and Joe, please add to this — your mutual fund is made up of a collection of stocks, and the manager of that fund is buying and selling those stocks all the time, and consequently, they’re creating gains or losses in those stocks, and the stocks are paying dividends, and they’re required by their regulatory bodies to distribute those to the holders of the mutual fund. That’s the simple explanation.

Look at it this way, Jim. What you’ve been doing over the years is those dividends and capital gains, you’ve been reinvesting, you’ve been buying more shares, right?

Not really. I have to write a check to my tax guy, but —

I understand, but you haven’t taken the income from the mutual funds. You’ve been leaving the money in the mutual fund account, and when those dividends and capital gains are paid, you’ve been buying more shares. So if you look back over time how many shares you started with versus how many shares you have today, you have far more shares than what you started with.

Correct.

Okay.

Let me ask one quick <Inaudible> got to go. What happens one day I say sell it, then what?

Well, the good news is —

<Inaudible>.

It’s kind of good news, because you have been paying taxes all along and increasing your cost basis. So let’s take an example. Let’s say you invested $10,000 five years ago and over the course of five years you’ve gotten a couple thousand dollars in dividends and capital gains, and you pay taxes every year on those dividends and capital gains, and this is what your concern is and what you’ve been complaining about. I have to pay taxes on this money that I never got, and I’m losing money. So let’s say that today your account is worth — instead of the 10,000 you invested, let’s say it’s worth 12,000. You’ve paid taxes over the last several years on that 2,000, you could sell the shares today for 12,000 and pay no taxes because you’ve already prepaid the taxes.

And just to clarify cost basis, because I know we use these terms sometimes, the cost basis is whatever you take initially for the stock, the bond, the mutual fund, plus the dividends that have been reinvested, and that gets complicated for people if they haven’t kept the records. Now, the custodians, major custodians are required now as of two years ago to begin reporting cost basis and keeping track of that. But we have clients sometimes that have held funds, maybe, for 20 years.

Or more.

And then they want to sell it and going back and trying to figure out cost basis becomes a challenge.

Look at it this way, Jim. Let’s forget it’s a mutual fund for a minute and let’s say it was just one stock. Now, a mutual fund is a basket of stocks. Let’s just say you had one stock, IBM, and every quarter you got a dividend. That dividend was sent to you, you spent it, you pay taxes on it, you appreciated the benefit of it, you took your wife to dinner, whatever you did, you spend the money. And you still have the IBM stock. The IBM stock is going to go up and down every day, but you’ve gotten the income from it, you’ve spent it, you enjoyed it, you paid taxes on it. Okay I got it, I enjoyed it, I’m going to pay taxes on it. And the mutual fund what you’re doing, you told the mutual fund company, don’t send me my money, I don’t want to spend it now. I don’t want to spend the dividends or capital gains it’s earning, but take my money and buy me more shares. This way the next time there’s a dividend or capital gain paid, you get a bigger piece of the pie because it’s determined by how many shares that you own. So I understand what you’re saying about the taxes that you’re paying as you’re going along, but in the long run, you’re doing fine. Now, it’s nice if it’s in a retirement account. You don’t have to pay taxes as it’s going, but what you’re experiencing there is really the way all investments work — even the savings account. If you leave the money in the savings account and just reinvest and compound the interest, even though you don’t have it, you’re going to pay taxes on it, you’re going to enjoy it, and — so I hope that helps you, Jim.

Yeah.

<Inaudible>.

What happens to I sell it? Do I have to pay taxes on the initial money?

No, no.

<Inaudible>.

When you sell it, the only taxes you pay is the difference between what you’ve invested plus all the dividends, interest, and capital gains that may have accrued over the years that you paid taxes on, and the market value when you sell it. So once again, let me take an example. You invested 10,000, you’ve got a couple thousand dollars worth of dividends and interest and capital gains you’ve paid taxes on over the years. That’s taxes paid on that 2,000. So you’ve got 10,000 plus the 2,000 of earnings you’ve had you’ve paid taxes on, and if you sell it for 13,000, yeah you’ll have to pay taxes on the $1,000 between the 12,000 and 13,000, not the 10,000 that you originally invested and the 13,000 today. But that’s how it works. So you’re not being cheated, that’s the way it works, and that’s the way it is.

Alright, we’ve got to get to Dave Wall in the News Center. If you’d like to join Joe or Judi, the number to call is 844-220-0965.

It’s an Ask the Experts Saturday morning on News 96.5 WDBO. This is On The Money, brought to you by the Certified Financial Group. We’ll get back to the news room in about three and a half minutes from now. We went over a little bit last time around. Dave Wall is keeping an eye on things, including more on that performance last night where one of the artists was killed down at the Plaza. <Inaudible> we were just talking about it, that’s so sad. So sad. In the studio, Joe Bert and Judi Sandborn from the Certified Financial Group, and nobody on the phone, so now’s your chance to call. Joe, what are you taking calls about?

Once again, Judi and I are here to answer any questions that might be on your mind regarding your personal finances. As we often times say, we go through life trying some of this, trying some of that, and we wake up one day and find we really have a collection of financial accidents because we don’t get any guidance. They don’t teach you about this stuff in school. We read money magazine, talk to our coworkers, watch television, listen to radio, pick up the newspaper, go to seminars, and we have some of this going on and some of that and it’s really very much just <Inaudible>. So you don’t have a plan. And our job as certified financial planning practitioners is to put all the <Inaudible> together and get you started on the path to financial security and peace of mind, and we do this day in and day out. As I said earlier, we do this for a fee during the week, but on Saturday morning we are here for free, so if you have any questions regarding your personal finances, anything that’s on your mind, anything you always wondered about, like Jim had questions about gee how come I’m paying taxes on this money that I never really got, well he did have an opportunity to withdraw it if he needed it. We’re here to answer those questions, so pick up the phone and dial —

844-220-0965, or text us at 21232. Here’s a text for you all. If for some reason you don’t do it — I guess this refers to that required minimum distribution and that 50% penalty you were telling us about. If for some reason you don’t do it in time and you get hit with that 50% penalty, what is that 50% of?

I think that’s a great question. The 50% is of what you should have taken as a required minimum distribution. So, in Joe’s example, he said if you have $1M — well, he didn’t say $1M required minimum distribution, but say your minimum distribution is $25,000. Then you would have to pay a penalty on half of that plus you would pay ordinary income tax. So it’s a big penalty. I would suggest that the first time you didn’t take it, you missed it, I would think — and I don’t have direct experience, but the IRS is probably pretty forgiving <Inaudible>.

Yeah we had some experiences where clients have come to us and said Judi my advisor never told me about this, could you help me straighten this out, and we have been successful in certain circumstances. We can demonstrate that it’s been a total screw-up.

Right. And I think that’s the first time. I wouldn’t have had <Inaudible>.

<Inaudible>.

Maybe once. Maybe once.

Okay, here’s the phone number if you want to join us, 844-220-0965. We’re going to head to Dave Wall in the News Center and then come back and talk to Suzanne in Orman Beach about some matured EE bonds.

It is an Ask the Experts on News 96.5 WDBO. My name is Kirk, and this is On The Money brought to you by Central Florida’s oldest and largest oldest and largest —

Independent.

Independent.

Firm of certified financial planning professionals, that being the Certified Financial Group in Altamonte Springs. Largest and oldest independent — one of these days —

Oldest only refers to the firm <Inaudible>.

Well, one look at Joe —

Not the employees.

One look at Joe and Roger will tell you that. You guys haven’t aged very much. You’ve aged, but say you’ve aged appropriately.

Gracefully is a nice way to put it.

Still aging, right.

Well, Judi, in case anybody may be joining us late here, what are you guys taking calls about?

We’re taking calls about any financial issues you might have, 401(k)s, IRAs, life insurance, long-term care insurance, annuities, what should you do to get ready for retirement <Lost Signal>. What did you do to get ready for retirement, and Joe had mentioned earlier when he was going through all of the things that we do answer your questions about that people have a collection of sometimes we call them financial accidents. On our website, we always have a must read and articles that feel can be very valuable to you, and this week’s must read is 10 ways to get ready for retirement after age 50, so if you have reached that stage in your life insurance where you begin looking at your financial assets and going why did I buy these and what are the supposed to be doing for me, I encourage you to go to our website and perhaps you’ll get some ideas as to what you can start doing to be a little more organized with your planning.

And that website is?

The website is www.financialgroup.com, and once you’ve done that, if you would like to have a complimentary consultation with one of the certified financial planners, you can click on a link that will take you directly to filling out some information and someone will be happy to get back to you.

I like that word, complimentary.

That’s it.

Alright, 10 ways to get ready for retirement after age 50, you’ll find it on the website, financialgroup.com. Alright, let’s get back to the phones. Incidentally, if you’d like to join us via phone today, the number to call is 844-220-0965, and Suzanne — who not only has a beautiful name, she’s one patient person. Good morning Suzanne.

Good morning, how are you?

Alright, Suzanne.

Good.

How can we help you?

Well, I have a question about EE bonds. My grandmother had purchased EE bonds 30 years ago, and now every year they’re coming up <Inaudible>, and I was able to roll them over into an H bond at one time, and that’s no longer an option and I’m getting hit every year with big taxes on this. I’m wondering if you know of any way I can avoid that. If there’s somewhere I can put it, or I don’t know.

No, unfortunately, you can’t. The government wants their money, that money has been deferred over all these years, and they want to get their taxes on it. So as of September 1st you said — actually September 1, 2004 —

Right.

You’re no longer allowed to reinvest in HH bonds and defer those taxes. Yeah.

Okay.

So — yeah. How old were they issued? After 1965 — if they were issued before 1965, you earn interest for 40 years. Bonds issued after 65 are 30 years. <Inaudible>.

Yeah they were after ’65. 30 years.

Yeah, <Inaudible>. So if they started maturing in 1995 and beyond, yeah. So that’s the bad news.

I couldn’t roll them over into like an IRA or a Roth IRA, open up one of those, and it wouldn’t defer longer?

<Inaudible> no, you can cash it out, pay the taxes and take the difference if you’re eligible for an IRA or a Roth and maybe get a tax deduction for what you put into the IRA, but —

But you can’t defer it any longer.

I like your thinking though. I like your aggressive nature.

<Inaudible>.

Unfortunately —

Okay.

Unfortunately the time has run out. Be thankful further grandmother was frugal and left you some funds.

Very, very thankful.

Yeah.

Yes, very.

Well, you don’t have to tell us — <Inaudible>.

Okay thank you very much.

Suzanne, just out of — you don’t have to tell us the amount but just out of curiosity, how many individual bonds did your grandmother accumulate?

Oh, many of them, and they’re all coming due over these past few years.

Yeah.

So I’m getting hit with a lot of interest. Like you said, I’m very grateful. It’s money that I didn’t put into it.

Sure.

I was just kind of wondering if there was something I could do, that’s all.

Sure. Well, you know, the thing is, and here’s what often times happens. We see this a lot here. <Inaudible> this little mini windfall every year, right?

Right.

We’ll call it a mini-windfall, and the government takes out their part of the <Inaudible> pay taxes on it, and the key is, if you don’t need that money or discipline yourself to save it and invest it for the future, let it grow, unfortunately human nature being what it is, comes in and we always find a place for it.

Always a way to spend it.

Yeah, sometimes it’s spend on wants, not necessarily on needs, and I guess the key is to get that money working for you <Inaudible> and certainly if you put it in a retirement plan, if you’re working, it can increase your contribution to your 401(k) or do an IRA and get a tax deduction that way. But that’s just my words of counsel to you.

Okay, alright. I really appreciate it. Thank you.

You’re welcome. Thanks for the call and thanks for listening.

We all want to avoid taxes any way we can, so I want to go back to the required minimum distribution issue because there is a way to avoid paying the taxes on your required minimum distribution. You can make a charitable contribution, it has to be made directly to the charity of your required minimum distribution.

By directly you mean —

You have to have the check written to the charity.

Not from your checking account, right, the custodian to the charity.

Correct. Very good point. And you can give up to 100,000 of your required minimum distribution. Now, if your required minimum distribution is only 20,000, you can only give the 20,000.

Right.

But if it’s 120,000, you could give the 100,000 to a charity or multiple charities. It doesn’t have to just go to one, and that’s a way you can avoid paying the taxes on that distribution.

And people often wonder, oh, what the heck is the difference if I get the money and then turn around and write a check for $100,000. The difference is it affects the taxation of other things in your Social Security perhaps.

Right.

Yeah, so yeah, so <Inaudible> use the taxes you pay on other income by doing that direct transfer you suggested from the charity directly — from the custodian directly to the charity. Don’t let it pass through your fingers.

And you know, that’s another good point Joe, because if you choose to take two required minimum distributions in one year, then you need to be careful because that’s considered ordinary income, and that can increase your Medicare payment.

Yes, exactamundo. Yes.

So there’s another reason to be mindful of when you take that first required minimum distribution.

And how you take it. Exactly.

Coming up on 9:45, quarter until 10:00 on News 96.5 WDBO. Dave Wall is in the News Center, keeping an eye on our top stories today of course. One of them is that murder that happened last night at the Plaza concert venue where the artist, who was performing, was killed after her performance, and Dave will have more on that investigation coming up here in about five minutes from now, stick around. Right now, we’ve got Joe Bert and Judi Sandborn from the Certified Financial Group in the studio, On The Money, the number to call is 844-220-0965, or you can text at 21232. Let’s talk to Nicholas in Orlando. Good morning, Nicholas.

Good morning.

Good morning, Nicholas, thank you for calling. How can we help you?

Well, I have a question. I am currently no longer with a certain employer, and I have a 401(k) <Inaudible> see it go down, and I want to roll it into like <Inaudible> do I need to combine <?> or —

So let me be sure we understand your situation. You left your employer with money still in the 401(k), and what you want to do is move it into something, and you’re concerned because you see it’s going down so you want to put it in precious metals because that doesn’t go down?

Well, I know they go up and down, it’s just —

I just wanted to catch you there, buddy.

<Inaudible>. More security. I feel more secure with precious metals versus —

You do? And why is that? Tell me why that is.

<Inaudible> it’s going up.

Well — to really answer your question, you can roll that into your own personal IRA and there is a group in Orlando where you can go and set up a self — what’s called a self-directed IRA, and hold unusual, alternative type assets in it such as precious metals, such as real estate. If you would call the office on Monday, if you have an interest in doing that, I can give you the number — name and number of that group. That’s not mainstream, of course, and I think what Joe was trying to just caution you about is precious metals or any type of those unusual investments are quite volatile. You sound relatively young, so maybe you have the time to weather all of that volatility, and if you understand that it’s going to be volatile, it can be down big and it can be up big potentially, then perhaps that’s something that might be beneficial for you and your individual circumstances.

You know what I think — often times people gravitate towards those kinds of investments because they’re simple to understand, as opposed to — we talked about mutual funds, we talked about stocks and bonds and real estate, which has a lot of moving parts. So people understand okay I’ve got a <Inaudible>, okay, and I understand what it’s worth and it’s right there in my hand, don’t have to worry about dividends, capital gains, management, bankruptcy, yada yada yada. But they fail to realize that that asset fluctuates every day — every minute, just like any other investment. And so I think it’s —

So until you sell it.

<Inaudible> people gravitate toward that kind of stuff, it’s not necessarily it’s good for you, but it’s simple to understand.

It’s simple, but also it’s — right now you see a lot of advertising about it, especially gold, and —

And silver.

Gold’s been as high as $1,800 <Inaudible> that’s when people like to buy it.

So here’s a Nicholas, he left his job, he’s got that 401(k) back there and he’s watching the volatility of this 401(k), what should he do about that 401(k).

Well I mean I certainly encourage most people to roll it into their own IRAs so that they do have the control over what they would like to invest in, but since Nicholas kind of brought up the volatility and watching his account go down, I have to have several clients call me and say why isn’t my account up more because the market is up so much. So, I’d like to put that in a little bit of perspective because if you look year over year as of Friday’s close of the market represented by the Dow and represented by the S&P 500, the market has been flat. And in the last three years the down has been up 5.4%, and the S&P has been up 8.5% annualized. So, if you look at a longer-term perspective, if you’re diversified in the market and this certainly isn’t a diversified portfolio that I’m telling you about, it’s 100% stocks, but the market just year to date is up about 2.5%. So the markets, I’m not sure what people might be looking at that they think the market is up so much but the market hasn’t really dramatically been up in the last 18 months because relative to the up days there are also significant down days.

Judi, what if he’s not contributing to this 401(k) and it’s just sitting there. Is it languishing, or —

No, no. Typically it would continue to be invested in whatever his employer offered and however he chose to invest it while he was at work.

Okay.

But nobody’s watching it. I mean he would have to watch it. Nobody else is watching it.

Alright we’re coming up on news time. Dave Wall is in the News Center. Orlando is in the top of the news across the country for this story that Dave’s about to tell you about, so stick around, and then more with Joe Bert and Judi Sandborn from the Certified Financial Group. If you’d like to join us, the number to call is 844-220-0965. When we come back, David in Seminole County has a question about required minimum distribution, and we’ve got an e-mail question about that as well, so stick around, more is coming up.

9:56, four minutes away from Dave Wall in the News Center. We’ll get right back to him, but right now we are with Joe Bert and Judi Sandborn from the Certified Financial Group. Just enough time to talk to David from Seminole County, good morning David.

David.

Yes, I’m here. A few quick questions. One is, my wife has to take her required minimum distribution, she needs it to take it this year or next year April 1st, my question is she has several IRAs, can you split it? Can you take part of it this year and the remaining that we should’ve taken by April 1st next year?

Well, I would think so.

Yes.

On the first one, the only requirement is that you have to take 100% of it by April 1st.

By April, okay. And my second question — the reason I ask that, it had to — she’s still working but she’s self-employed, can — where she’s of course 70 so we can’t do it on a regular IRA, but what about a Roth. Could we do on her income for her and a spousal Roth for me?

Yes. <Inaudible>.

Or this year, 2016 — I’m trying to get her to retire so hopefully this is only <Inaudible> some money into that to leave to the kids or whatever. So okay, <Inaudible> question. Thank you.

Good, thank you, and actually thank you for the question because the last — one of the other aspects of turning 70 and a half is that you can no longer contribute to a traditional IRA.

A deductible <?> IRA. Right.

You can do a Roth if you’re working, you’re self-employed. You can do a SEP, you can do a SIMPLE IRA, but you cannot contribute any longer to a traditional IRA. So whether you’re working or <?> —

And the funky thing is, you can’t roll over your RMD to a Roth. People always want to do that, you can’t do that.

No, you cannot.

<Inaudible> got about a minute left in the program here. Do we have some workshops coming up here?

We do.

We do, always. Always. The next one is June 25th which is a Saturday from 11:00 to 1:00pm, and it is When Can You Retire, Know Your Number, and that’s hosted by Gary Abley, and the next is Saturday, July 23rd from 11:00 to 1:00, that is hosted by Gary Abley along with Jodie Murphy, who is an estate planning attorney, and that is Countdown to Retirement. There’s a Social Security Boot Camp on Thursday, July 28th, from 6:00pm to 7:30pm, hosted by Nancy Hecht and Denise Kovatch, and the last one that’s scheduled is Tuesday, September 27th, from 6:00 to 8:00, financial basics for life, strategies for success, and that’s hosted by Gary Abley as well.

All that information is on our website, financialgroup.com, that’s financialgroup.com, click on workshops, you can make a reservation right there, and we look forward to seeing you.

The information presented on this program is believed to be factual and up to date, but we do not guarantee its accuracy and it should not be regarding as a complete analysis of the subjects discussed. Discussions and answers to questions do not involve the rendering of personalized investment advice but is limited to the dissemination of general information. A professional advisor should be consulted before implementing any of the options presented. Certified Advisory Corp. is registered as an investment advisor with the SEC and only transacts business in states where it is properly registered or is excluded or exempted from registration requirements.

Schedule A Virtual Meeting From Anywhere In The World