Should We Update the House or Sell as Is?

Jill Schlesinger (0:03)

Welcome to the Jill on Money show. It's Thursday, October 8th, and we are here talking about whatever is on your mind financially. If you've got a question, if you want a scenario, a second opinion, give us a holler, go to jillonmoney.com, click the contact us button, write us a note, and if you want to join us live, just check the box, Mark will do everything else. While you're on the website, check out all of the amazing content that lives there. We also have another program, it's called Money Moves, it's our YouTube show, and we'd love for you to subscribe to that as well. And everything just says, it's a Jill on Money kind of day. That's all you can consider it that.

All right, let us get to you, because this is the show that is about you. We've got Paul who joins us from Virginia. Hello, Paul, what is going on?

Paul (0:51)

Hello, Jill.

So we are looking at selling our house that we've lived in for 36 years and moving to another state. And we have questions about how we should proceed through this process.

Jill Schlesinger (1:05)

Okay. Well, hold on. Before you do that, Paul, how old are you?

Paul (1:11)

I will be 70 in December.

Jill Schlesinger (1:13)

Okay. And you have a spouse because you said we. How old is your spouse?

Paul (1:18)

My spouse is 65

Jill Schlesinger (1:21)

I like that. He's sort of like, you're sure about that? I'm not sure. Yeah, she said she's saying yes. Okay. And do you guys both work still? Are you retired?

Paul (1:32)

We're both retired. I retired five years ago and my wife retired at the end of last year.

Jill Schlesinger (1:39)

How are you supporting yourselves? What are your sources of income?

Paul (1:43)

So I have two pensions from my job, which equal about $60,000 a year. My wife was a federal employee, and so she has a pension from her job.

She gave me paperwork here. Let's see.

Jill Schlesinger (2:00)

I love it. It's at Theater of the Mind right there. I got that. The sound effect mark is great.

Paul (2:05)

So her pension she gave me by the month is $9,900 a month.

Jill Schlesinger (2:10)

Ooh, look at us.

Paul (2:12)

And it's adjusted for inflation.

Jill Schlesinger (2:15)

She's gorgeous. I love it.

OK, wait, $9,900 a month. And does that mean she was a federal employee? Does she also have health insurance?

Paul (2:27)

Yes, she does. And we have kept her health insurance in retirement. And that might be a different podcast to talk about whether that was a good idea or not.

Jill Schlesinger (2:36)

Interesting. OK. For you on this current income, how's everything?

Paul (2:43)

We bring in a lot more money than we spend, although taxes have really hit us hard. Getting capital gains spun off from investments, and we did some Roth conversions that turned out to be more expensive than I had anticipated.

Jill Schlesinger (3:01)

It's not such a terrible thing to pay taxes because you sound like you have a lot of money coming in. Tell us about what is still in pre-tax retirement accounts that have, you know, like your retirement accounts not yet been converted.

Paul (3:14)

Okay, so my traditional has 1.4 million.

My wife's has 1.2 million. So those are in 401k type accounts.

Jill Schlesinger (3:28)

Okay.

Paul (3:29)

And I have a traditional IRA. It has nothing in it. I only use it to convert.

Jill Schlesinger (3:34)

Okay.

Paul (3:35)

So would you like the Roth balance?

Jill Schlesinger (3:37)

Yeah, let's hit me up with the Roth.

Paul (3:39)

So the Roth IRA has 800,000. The Roth 401k in my account has $327 because I can never figure out how to get the last bit out.

Jill Schlesinger (3:54)

Wait, I thought you were saying 327,000. You're actually saying $327.

Paul (3:59)

Yes.

Jill Schlesinger (4:00)

That's hysterical.

Paul (4:01)

Okay.

And my wife, I've tried two or three times to get that to zero. It just, I can't do it.

Jill Schlesinger (4:06)

Okay.

Paul (4:07)

My wife's TSP Roth is $660,000.

Jill Schlesinger (4:12)

You guys got piles of money. Do you have grown kids?

Paul (4:16)

We do. Two boys.

Jill Schlesinger (4:19)

Are you helping them in any way?

Paul (4:21)

Yes. Yes, we help them.

Jill Schlesinger (4:24)

How much help?

Let me do this. How much money do you spend on a, generally, on a monthly basis, and include the help to the kids?

Paul (4:35)

We spend $6,500 a month.

Jill Schlesinger (4:40)

Including everything?

Paul (4:41)

Does that include?