2022-9-8_MWL

You've heard it said there's no free lunch, but did you know there's no free investing either?

Hi, I'm Rob West. If you have money in a 401k, IRA, or a regular brokerage account, do you know what that costs you in fees and commissions? I'll pull back the curtain today on investing's hidden costs. Then it's on to your calls at 800-525-7000.

That's 800-525-7000. This is MoneyWise Live! Biblical wisdom for your financial decisions. So first, let me be clear. I'm certainly not trying to dampen your enthusiasm for investing.

Just the opposite, really. I want you to feel confident that you're getting the most from your investing dollars. To do that, you need to understand that there's always a cost associated with any type of investment, even a qualified retirement account where taxes are deferred for many years. As I said, there's no such thing as a free lunch. So why bother telling you about those costs?

Well, because they can and do vary greatly. Some brokerages may charge more than others to manage a retirement plan or a particular mutual fund. When you know what types of fees are charged, you can then shop around for investments with lower fees and commissions.

Now, what are some of those common fees? Well, different investments have different types of costs. Mutual funds, for example, charge something called an expense ratio. This is the cost of managing the fund given as a percentage. Let's say you had a great year with a particular fund and made 10%.

Probably not this year, but we're talking hypothetically here. So you made 10%, but the fund has a 1.5% expense ratio. That means you really only made 8.5%. Now, the fee isn't exactly hidden, but you'll never see it as a bill either. It's deducted from your assets. Other fees can be hidden within your expense ratio. One example is something called a 12B1 fee, and it's for marketing costs. That's where you get to pay your fund manager to promote it to other potential investors.

You didn't know you were that generous, did you? Now, what about some other fees you may be paying without realizing it? Well, you also have annual and custodian fees. Annual fees typically run from $25 to $90 a year. Custodian fees are what retirement plan managers charge for complying with IRS reporting regulations.

They usually run from $10 to $50 a year. Mutual funds tend to have other costs called purchase and redemption fees, and they're usually a percentage of the amount you're buying and selling. And you've probably heard the terms load and no load for mutual funds. A loaded fund is one where a commission is charged, and there are three types of these so-called loads. A front-end load is a single charge you pay when you purchase shares in a mutual fund. A back-end load, as you might expect, is a one-time fee you pay when you sell your shares.

And then there's something called a level-load fund. That's where there's an annual fixed percentage taken from your assets. A front-load fee may run you 3 to 6% when you purchase shares. A back-end load may cost you 4 to 6% when you sell your shares. A level load may run between a quarter and 1% of your fund investment, and while that sounds like a great deal, remember that's not a one-time fee.

It's annual and charged each year you hold your shares, and that can add up. But what about no-load funds? Well, obviously they're preferable to a load fund, but even no-load funds may still have some fees. For example, you may have to hold your shares for a period of time, often five years, or you'll be charged a commission.

So what, if anything, can the average investor do about all of this? Well, obviously you want to choose investments that have lower fees and commissions, because again, those costs can add up. Now, you might hear an argument that the higher the fees for an investment, the greater the return will be. In other words, you get what you pay for, because often those higher fees suggest the fund is more actively managed, and therefore will perform better.

Well, you'd think so, but studies show that's not the case. Some of the cheapest equity funds have outperformed the most expensive ones over long periods of time. Morningstar has determined that in most cases, you'll have greater earnings over time just by choosing funds with lower expense ratios.

Simply put, cheaper is often better when it comes to fees and commissions. So I hope that encourages you to look carefully at your investment fees and choose wisely. Ben Franklin said, a penny saved is a penny earned, and that's so true when it comes to investing. All right, your calls are next, 800-525-7000. You're listening to MoneyWise Live, biblical wisdom for your financial decisions.

Stick around. Great to have you with us today on MoneyWise Live, biblical wisdom for your financial decisions. I'm Rob West, your host. We're taking your calls and questions on anything financial today as we apply God's wisdom to your decisions and choices.

What's on your mind today? We'd love to hear from you. 800-525-7000. We've got some lines open.

800-525-7000. Before we head to the phones today, this week's featured Scripture verse in our MoneyWise Weekly Wisdom email comes from Matthew 28, verses 19 and 20. You'll know it well. Therefore, go and make disciples of all nations, baptizing them in the name of the Father and of the Son and of the Holy Spirit, and teaching them to obey everything I have commanded you.

Well, that's good news from God's Word. You'll find that alongside our recommended reads and our trending podcasts. It's all in the MoneyWise Weekly Wisdom email to encourage you in your journey to be a faithful steward of God's resources. You can sign up to receive your weekly wisdom email or digest at MoneyWise.org. Just click the button that says Create Your Free MoneyWise Account to subscribe. Again, MoneyWise.org. It comes out every Thursday. This week's edition is out and live. We'd love to give it to you.

Again, just head to MoneyWise.org. All right, let's head to the phones. Reading, Pennsylvania is where we'll begin today, and we will begin with Hector. Go right ahead. Hello?

Hi, Hector. You're on MoneyWise Live. Go ahead, sir. Yes, I have a question about my retiring. I'm still working, 65. I haven't started collecting Social Security. I did retire from one job. I get a pension from them.

I would like to know when it will be the best time for me to collect Social Security, and I don't have any debt at all, other than the monthly bills that come to the house. Yes, very good. Okay, so you're retiring from your second job, too. You have a pension from each one.

Is that right, Hector? Yes. Okay, very good. And you're wondering about collecting Social Security. Does your pension cover your expenses, all of your monthly expenses? Well, right now, with the work I'm working on the pension, yes.

Okay, very good. So you're continuing to work, and therefore the pension plus your work covers all of your monthly bills. What is your age right now? I'm 65.

65, okay. And when do you plan to stop working? Do you have a time frame on that? I mean, putting it for this spring.

This spring. Okay, very good. And do you know what your full retirement age is? Is it 67?

Probably 66 and a half. Okay, very good. And so, you know, I think that's really the decision point there, is when you stop working, I suspect there will be a gap between your monthly need, your expenses, and what you're bringing in from your pension. Is that right?

Right. Okay, so that's probably the time to take Social Security. If you could continue to work, every month that you continue to work, that Social Security benefit check grows by one twelfth of eight percent. So it will increase by eight percent a year when you delay it. And every month, one twelfth of eight percent is added to that check up until age 70. So the longer you work and the longer you delay taking that check, the higher that's going to grow.

So I think you need to look at your budget and just determine exactly how much you need. If your two pensions plus Social Security will allow you to meet your obligations at, you know, this spring, then you could certainly go ahead and take that benefit. The only other thing to look at would just be to make sure that with those pensions that you were paying FICA taxes on the job for which you received the pension. Because if not, that would affect your Social Security benefits. It's probably the case that you were paying the FICA taxes. And if that's true, then you'll receive both the pensions and Social Security. And it really is going to come down to your budget, your spending plan to determine whether or not the three of those income sources, pension one, pension two, and the Social Security will meet your monthly needs. If so, you can proceed. But just keep in mind, as I said, every month you wait and continue to work that pension, excuse me, that Social Security check is going to grow. Does that make sense?

It does. Yeah. So I think that's really what you need to do.

You can get with the Social Security Administration at SSA.gov just to confirm your benefits. And then it's really just a determination of how long are you willing to work and how do you make the budget balance most effectively? All right. Yes. Here's the other thing that I'm looking at.

Right now, if I start collecting my pension from the job, I will only miss like $150 off my check if I collect a pension, if that. Okay. All right. Very good.

I'm only going out to work probably, I'm saying like for $150 more. Yeah. Okay. Yeah.

And that's really what you need to look at is just compare the numbers and determine the optimal time for you to retire and begin collecting Social Security in light of what the check will be, the monthly benefit versus your budget versus your desire to continue working. So I'm confident you'll figure this out. The next step, Hector, is to determine what God has for you in this next season. And I'd be considering that prayerfully as you ask him perhaps what your assignment is next. We appreciate you calling today. If we can help further along the way, don't hesitate to reach out. God bless you.

To Georgia we go. Lynn, you're next on the program. Go ahead. Hey, thanks for taking my call.

I have a quick question, I think. I have three different 401Ks. Two of them are from prior employment. Should I roll them over into my current employer's 401K? Yeah, I like that a lot. What are the balances roughly in those other two 401Ks, Lynn?

One's about 50 to 60, I think I'm down to, and the other one is between 25 and 30. Okay, yeah. So I think that makes a lot of sense because then you'll have one account, so you'll simplify your situation, just one set of statements and accounts to keep up with. You can really streamline the investments to make sure you're invested properly in such a way that is aligned with your age, goals and objectives. And you'll just need to check with your 401K plan administrator to ask and ensure that they will allow you to roll those in.

Typically they do, but you'll need to check first. If not, you would want to roll them out to probably one new IRA. But I think in your case, getting it all in that 401K with your current employer makes a lot of sense. Okay, can I ask one more quick question? Sure, yeah. Is there a maximum amount that I can contribute into my 401K?

Yes. So are you doing salary deferral currently? I am.

I was doing 10%. I have a Roth and a regular. Alright, and what is your age? 55. 55. Okay, so if you're over 50, you can actually put in, let's see, $20,500 plus another $6,500.

So you can actually put in $27,000 over the age of 50. Awesome. Alright, that helps me a lot. I appreciate it. Absolutely.

Thanks for your call, Lynn. You know, folks, as we think about handling God's money, we have to recognize we're stewards of God's resources, so we want to go to the source to find out what's on the heart of the master. You see, a steward reflects the master's wishes in how he wants us to handle his money. Well, God's word is chock full of wisdom related to how we can manage his money. We live within our means, we avoid debt, we set long-term goals, we have margin or surplus in our financial life, and we give generously. And when we do that, it puts us in a position, I believe, to experience God's best. Let's continue to unpack those principles related to your questions just around the corner.

Stay with us. Thanks for joining us today on MoneyWise Live as we apply God's wisdom to your financial decisions and choices. I'm Rob West, your host, taking our calls and questions. We've got some lines open today.

We'd love to hear from you. 800-525-7000. That's right, the number to call, 800-525-7000. Back to the phones we go to Florida. Nicole, you're next on the program. Go right ahead.

Yes, hi. We have a 13-year-old daughter, and we currently have almost $32,000 saved for her college education. And that was more money than the Florida prepaid had when I looked into it, and we don't have a 529, it's kind of like a $50,000.

And we're trying to decide if we should do a 529, but if it's, you know, because of the stock market being the way it is, and there's only five years left, if that's a wise choice with that amount of money, and if not, what should we do instead? Yeah, very good. Are you looking to continue to contribute, Nicole, to this account, or would you just take and maximize what you've already saved up? We do, we contribute a little bit every month still to it. Very good. And do you think you all would qualify for any need-based aid? No, I don't think so.

All right. Yeah, a couple of options here. I mean, you certainly could do a 529. You're kind of right on the cusp of when, you know, whether or not this makes sense in the sense that it's going to begin to get or would typically want to be more and more conservative as you get closer and closer to the need for the money, which is college, and you're just five years away. At the same time, the market is down right now, and so, you know, you could put in that whole 32,000, 16,000 each as a gift from each 16 from you and 16 from your husband, and you wouldn't have to file a gift tax return.

It still wouldn't be taxable even if you went over that, but you'd have to let the IRS know that you went beyond the 16,000. And then, you know, you could take advantage of the market's recovery over the next couple of years, and then, you know, once it rebounds and recovers to a point where, you know, we feel like it's made up for all the losses, at that point, you could begin to get a little bit more conservative as you get closer and closer to college. So I think that would be a great option. The other option to consider just in light of where the interest rates or the yield is right now would be an I-Bond account, which you could do either, well, you could do it in your daughter's name as a custodial account, and then at the age of 18, she would have access to the money. But the I-Bonds are paying 9.62% right now with zero risk because they're backed by the U.S. government, and you'd pick those up at treasurydirect.gov.

You'd open an account in her name, a custodial account, naming you or your husband as the custodian, and then you would transfer the funds in. You could only put in up to 10,000 this year, and then you could put in another 10,000 next year. Now, that 9.62% is good through November.

It'll adjust at that point based on the consumer price index, and I expect it will come down, but probably not a whole lot, just given that we expect inflation to stay fairly elevated for the foreseeable future. So I think those two options would be good ones, and that would be considered an asset of the child, which would hurt you from an expected family contribution standpoint if you were trying to qualify for need-based aid. But if you don't, then it's not really of a concern. You're just looking to maximize the investment performance and keep the risk as low as possible, and that's where the I-Bonds, at least for the next year, which would be how long you'd have to leave the money in there for a minimum of 12 months. That's where the I-Bonds would be really effective. Okay, thank you. That's wonderful. I didn't even know about the I-Bonds, so I appreciate it.

Absolutely. So if you're going to open a new 529, I'd go to savingforcollege.com to go through the little information gathering portion, and they'll recommend the top five 529 plans for you. So that would be for that portion, and then for the other portion, for the I-Bonds, you go to treasurydirect.gov. That's the only place to get them.

That's the U.S. Treasury's website for buying electronic bonds. Hopefully that's helpful to you, Nicole. We appreciate your call today. Let's see.

North to Chicago, WMBI. Pamela, thanks for calling. Go right ahead. Hi. Thank you for taking my call.

I have a question. I'm 60 years old, probably won't retire for another four years. But when I went to Social Security, as I was, you know, just letting them know that my husband had passed away, it's been seven years, and they told me that I may be eligible for the widow's benefit. But what my question is, is will I be able to obtain that if I'm still working full time? Because some people have told me no, and I haven't contacted Social Security. Yes.

Okay, very good. Yes, once you've reached age 60, you are eligible for survivor benefits, and you should be able to qualify for those regardless of whether you are continuing to work. If you're entitled to benefits, those are for you. And you can apply for them either online or by calling to get an appointment, 800-772-1213. That's 800-772-1213.

But yes, short answer is you are eligible for those survivor's benefits, and you can collect them even if you are working. Okay. All right. Thank you so much.

Have a great day. Thank you, Pamela. We appreciate your call today. Folks, we've got some lines open today. 800-525-7000 is the number to call.

Again, that's 800-525-7000. A quick email that came in to us from Catherine before we head to our next break. She writes, I'm going on a mission trip. Should I be tithing on the donations that people give me for the trip? And I think that's a great question.

I appreciate you asking, Catherine. You know, we don't want to be legalistic about our giving. We want to give from a cheerful heart out of obedience and as an act of worship. I love the tithe as a beginning point. And if we apply the principle of the tithe here, Catherine, it's actually based on your increase. Now, I would make this an exception. You can't outgive God, so if you want to give a tithe on it, you go ahead.

But here's why I wouldn't. This gift is given as almost a designated gift. So the donor is wanting to fund the mission trip specifically. So in my view, this is not your increase because it really can't be used for anything other than the mission trip. So I would honor the donor's intent and put 100% of this money toward the mission trip.

But all the other income sources you receive that are truly your increase, be it W2 income, Social Security, a pension, an inheritance, that is your increase and I would give a tithe. Thanks for writing to us. We're going to take a quick break. We'll be right back on MoneyWise Live. Stay with us. Doug, thanks for calling, sir. Go right ahead. Yes, thanks for taking my call.

I appreciate it. I just got a question for you. I have been looking into or have been seeing, I think the term is real estate crowdfunding and kind of pulling your money with others to purchase real estate investment properties. Just curious what your thoughts are on that and what you have seen with that.

Yeah. Well, it essentially uses social media to connect investors to investment properties. So it's similar to equity investing since you can buy into a property and become a shareholder and it offers companies access to capital they might not ever otherwise be able to raise.

I'm not a big fan of this just in terms of I'd rather see you either do this in the form of a real estate investment trust, a more passive type of approach or through a direct ownership. Now, the benefits are that you have a shared cost structure and you're spreading the risk out. You can diversify your assets. But the downside is you've got management or advisory fees. Assets typically can't be sold off quickly or divested of quickly so you may be somewhat illiquid.

You have to pay taxes on any dividends you receive. And the challenge is these are relatively new platforms and so with any new offering that doesn't have a lengthy track record of success, you're just taking an increased amount of risk. Also, often these require you to be accredited which just means you have to meet certain asset and income requirements.

So I think that would be the issue. Now, if you can handle the liquidity and you've done your research, you're accredited as an investor and you've got other assets. So this is really just a way to diversify into other asset classes then obviously it's going to allow you to access real estate projects and opportunities that you wouldn't otherwise be able to. And the dividends are typically larger than what you would see in a real estate investment trust. So I'm mixed on it. I think for the novice investor, I think the cons outweigh the pros.

But if you're somewhat sophisticated in this area and you read the fine print, you know what you're doing, then it can be a way for you to access real estate holdings that you wouldn't be able to otherwise. Does that make sense? It does, yes. Thank you. I appreciate that.

It's kind of given me a lot more to think over as far as what you said as far as what are the things to be thinking about when you get into that. So I appreciate that. So thank you. Absolutely, Doug. Thanks for calling today. God bless you, my friend. Let's see.

Aztec, New Mexico. Susan, you're next on the program. Go ahead.

Hi. Thank you very much for sharing your perspective. We appreciate it. I could use your help because my husband and I are trying to make a decision and we see it differently.

So as we're, you know, taking this into prayer and thinking about it, your perspective would be helpful. We have two rental properties. They both have about $100,000 on the mortgage left and they are rented for where after expenses and everything, we get about $500 a month that we're putting back into paying down the principal. Our plan was to pay the principal off by the time my husband turned 70 in about seven years. And then that would become part of our retirement plan is that income we have figured into our budget for retirement. Now, the question is the stock market is rocking and rolling. And if it drops, would it recover enough for us to even retire then? So what we're debating is, should we take some money out of our retirement funds and pay the tax hit and pay off one of these mortgages?

Then that's what we're debating. Sure. And did you say you're seven years away from retirement? So that would be your time horizon for these accounts to recover?

Yes. Obviously, I don't know what the future holds, Susan. And if you all felt convicted to be out of debt, I would say you could certainly proceed there. Just from a financial standpoint, though, I'm not a big fan of that plan.

Number one, you'd be locking in those unrealized losses and making them realized, eliminating the ability for them to recover. You're not one to two years out from retirement. You're seven years or so out from retirement. So you've got essentially still time on your side. And keep in mind, once you reach retirement, if you're in good health and the Lord tarries, you still have a decades long need for this money.

And you're taking away the ability for this money to continue to compound in a tax deferred environment. So if you can cash flow these properties, including the debt service, and put $500 a month toward either additional principal repayment or building up your emergency reserves for maintenance on the properties, then I kind of like you sticking with these properties and not pulling out of the 401k, which would generate a pretty massive tax bill and lock in those losses and then cause you to miss out on the recovery. You know, even though we've got some headwinds and some challenges here in this country, economically speaking, I think we will get beyond this. I don't see anything imminent that would cause us to think that the economy won't recover. And when it does, we know that the, at least historically speaking, the stock market will recover well in advance of the economy itself because the market tends to be forward looking six to 12 months. So I think from that standpoint, at least from my perspective, I'd stay on the current track of letting this 401k recover and continue to grow for the next seven years, continuing to pay down the mortgages through the rental income and accelerate that when possible.

And if you can have the maximum amount in your 401k when you retire, plus be close to or have these paid off just by, you know, through current cash flow on the rental income, then I think you've got the best of both worlds at that point. Oh, that's very helpful. Thank you so much. All right, Susan, thank you for your call today. We appreciate it very much.

Quickly to Plainfield, Illinois. Agnes, I've just got a minute and a half before our next break. Go ahead. Well, yeah, thank you for assuming my call.

I have a question. I had a will in another state and then my husband, we moved to Illinois. Fortunately, he passed three months ago. I was about to redone the will for myself. I approached a lawyer and after we talked, he said, I don't need a trust, but he said he's going to charge a thousand five hundred for the will and that he's going to add a medical power functioning.

I don't really need a power functioning for medical right now. And I'm asking, is that we cost that much? Yeah, the typical will does not cost that much. If it's relatively simple, Agnes, I would expect it to be closer to five hundred dollars. Fifteen hundred dollars would be more akin to a trust and not a will. Now, if there's additional complexities here or he was including the price of additional legal documents like a P.O.A. or a living will or a durable health care attorney, power of attorney, then that may get closer to the fifteen hundred.

But I might ask him why it's more than the average. And perhaps you get a couple of additional folks to give you a quote, if you will, for drafting a relatively simple will closer to that five hundred dollar target. So I might look around a bit unless you have some unusual situations going on that require some additional complexity. Hope that's helpful to you. Thanks for calling in.

So sorry to hear about your husband's passing. Folks, we're going to pause for a quick break when we come back. Our final segment and more of your calls just around the corner. Stay with us.

They tell you this today on Money Wise Live biblical wisdom for your financial decisions here in a final segment of the broadcast. Great questions coming up. Let's head back to the phones.

Miramar, Florida. Jane, you're next on the program. Go ahead. Hi, how are you?

I'm great. Thank you. I'm 65 years old and I have a grandson that's nine. And I wanted to open up a college fund for him. So I don't know if I'm sure it's a little late now, but should I open a 529? And I was thinking, can I just put a lump sum in there and leave it in there and add to it as I feel like I can have free money to put in there?

Or should I open up another account for him, a different kind of an account? No, I like the 529 at age nine. Jane, it's going to give you tax free growth as long as the money is used for qualified educational expenses and you really have ultimate flexibility in terms of the contributions. There are no contribution limits because these are funded with after tax dollars. The contributions are considered gifts for federal tax purposes. So you can put in up to sixteen thousand a year as a gift to an individual, including a child. If you go beyond that, there's no tax on it. It would just have to go against your lifetime exemption or gift tax exclusion of twelve million dollars. So until you get to twelve million dollars, you're not going to pay any gift tax. But if you get over sixteen in a single year, you just have to let the IRS know on Form 709. But apart from that, you can make lump sum contributions. You can make a systematic contribution or you could do both. You really don't have to tell them how or when you're putting in the money.

So it gives you really ultimate flexibility. In terms of choosing the actual 529 plan, Jane, for you, I would go to SavingForCollege.com, run through the questions that they ask you, and then they'll give you the top three to five 529s in your situation. Given that Florida doesn't have a state income tax, there's really no benefit to you staying in state to use the Florida 529. So that way you'll be able to look at all the other 529s and look at the investment performance, the fees, just the range of investments that are available.

And that's where Saving for College will give you some counsel on the best 529 for you. Does all that make sense? Yes. And my main question was, do I have to keep contributing or can I just leave it there? You can drop a lump sum in and you don't have to put in another dollar.

Or if you want to, you can add to it monthly or down the road. That's entirely up to you. Okay. All right. Thank you so much. Okay, Jane. Thank you for calling. God bless you.

Northwest Arkansas. Joe, you're next on the program, sir. Go ahead. Hey, Rob, I have a question about fees. I heard you talking about them earlier. I was going through my statements from 2021 online. All my statements are carried by all my accounts.

There's four of them. An IRA, a Roth IRA and two brokerage accounts are sitting on TD Ameritrade. But I have a financial advisor.

I think he manages them, but I'm not sure exactly what he does. But anyway, the fee for last year for 2021 was around $4,000. And he originally told me that he was charging me 1 percent. If the fee was a total of $4,000, that would mean that my accounts would have to total at least $400,000 and they don't.

And they never did during the course of the year. I see. And I approached him on it and he couldn't really give me a straight answer about how the fees were calculated. And he kind of had been hot about what actually his percent was. Didn't really give me a straight answer on that, but each time we spoke, the percent went up a little bit. OK. That's a little concerning, just given how you're describing the situation here. Notably that you approached him on it and there was not clarity as to how he gets paid and at what level. Do you know if he's a registered investment advisor or what type of advisor he is? I don't. I can give you the firm name, but probably not over the air.

Yeah, that's OK. I would just go back and say, listen, I want clarity on what I'm paying all of the various fees and if any commissions are being paid commissions. Typically, when you engage a registered investment advisor who would custody the assets at a Fidelity or TD Ameritrade, you would sign an advisory agreement that would have the percentage stated for the assets under management. And then those would typically be calculated quarterly. So just based on the asset value, given every quarter, the fee would be charged one third of that fee for that four month period.

And then again, the next quarter, it would happen again. So it's always based on the asset value at the end of the quarter. That would be most typical. But that would all be documented in an agreement that you would sign at the front end that would state exactly what those charges are. So what could be going on here is that there might be a combination of assets under management plus financial planning. But it doesn't sound like you're getting a whole lot of value out of that since you're even questioning what services are being provided. So I think at this point, you need to go back and just say, listen, I'm seeing $4,000 in fees. That is not consistent with what I believed I would be paying. So I need to know what exactly are you charging me? Where is the documentation that shows that when I entered into this agreement or this relationship? And what am I going to be paying moving forward? And try to get an understanding. Something upwards of 1.5% wouldn't be completely out of line, but the advisor should be able to explain exactly what you're paying and why. And the fact that you didn't get a straight answer is the part that's a little concerning.

So I'd place a call back to him, maybe even set up a meeting and go in and just let him know the purpose of the meeting is to understand exactly what is being paid and what value you get out of that both in the form of active management and oversight of the investments and any financial planning services. Okay. One more question. You mentioned a registered, what did you call it? A registered investment advisor. Registered investment advisor. Okay.

Yeah. And that would be somebody that would be governed by the Securities and Exchange Commission typically. And you could do an advisor search on either broker check or through the IARD system. You could go in and just Google IARD. That's the investment advisor registration depository.

And you could do an advisor search for your advisor there. If he or she doesn't come up in the IARD, then you would look at broker check. And that would be somebody that would be subject to FINRA, the financial regulatory authority. That would typically mean that they charge commissions and fees. But either one, either the IARD or broker check should allow you to find the advisor. And then you'd be looking for something if they're an investment advisor called an ADV.

They have to file an ADV with the Securities and Exchange Commission and that spells out not only their background and the assets under management and a lot of details about the firm, but it should have their fee schedule in there as well. So you might do a search in both of those repositories before you go in just so you've got that information handy. Okay. You kind of firehosed me with all this information.

Is there some place that would give me this? I mean, I got the ARID written down. Yeah. So let me just run through it again quickly because I don't think there's anywhere written down. So your next steps are this. Call your advisor and schedule a meeting.

Let him know you're coming in because you want to understand exactly what you've paid over the last year, where that was agreed to at the outset of the relationship, and what you get for that. Okay. That's step one. Step two is do a search for your advisor at IARD.com and if you don't find them there, look at BrokerCheck.com.

That's all you need to do and that will give you the information you're looking for about the advisor and that will get the meeting scheduled for you to get more information. Okay. Are these shows recorded that I could listen to it again? Yes, sir.

Absolutely. You'll find them on our website at MoneyWise.org probably tomorrow. We'll get this show turned around.

So, yeah, you can go check back there or in the MoneyWise app. And, Joe, we appreciate your call today, sir. God bless you.

Ohio, Jeff, you're next on the program. Go right ahead. Yes.

Thank you. Two questions. One, you've talked about a tax vehicle that you can put IRA money into that can be withdrawn and donated to charities without making it taxable. Could you tell me what that's called and how I would go about doing that? And the second question has to do with having my wife's Social Security start coming and not mine in order to get the increase and I wondered what you told somebody the other day and I didn't get it, what the circumstance would be that you should try to do that.

Yeah, very good. Yeah, the qualified charitable distribution, which is how you give a gift directly from an IRA to a church or a charity, is only really for somebody who has a required minimum distribution. So you do that when you reach at least age 70. And then basically what you'd be doing at that point would be making a gift from your IRA directly to the charity to satisfy the required minimum distribution. You have to be at least 70 and a half years old and you can donate up to $100,000 to one or more charities directly from an IRA and that satisfies any required minimum distributions up to the amount that the IRS says you have to take as you make the gift. The benefit is then that distribution is not added to your taxable income and the ministry or charity gets the full benefit of the gift at that point. Does that make sense?

It makes sense. However, I'm 66 and a half, but I have an inherited IRA from a deceased parent and I am required to take minimum distributions for that. So would I qualify for that or because I'm not 70 and a half? And so it's not going to be available to you. It will be something you can take advantage of down the road.

Unfortunately, in your situation, you're going to have to take that distribution and recognize it as income and then you can do with it what you want at that point. Unfortunately, sorry about that, Jeff. And unfortunately, we're out of time today, but we'd love to invite you to call back tomorrow and see if we can get you back on the program for that second question. God bless you, my friend. Thanks for checking in with us.

MoneyWise Live is a partnership between Moody Radio and MoneyWise Media. Thank you to Gabby T, Amy Rios. Thank you to Ryan Hansen and Jim Henry, my team today doing amazing work. Thanks for being along with us. We'll see you tomorrow. Bye bye.