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Investing — and who to trust

By Terry Savage on November 22, 2020 | Financial Planning / Retirement

I am a recent widow and would like to invest insurance money and money from a Florida home sale and am confused as to what to do. My husband and I have invested in CD because we were very conservative but at the rate they are paying, I will not make any money for myself and to leave a legacy to my two children and grandchildren. I have been contacted and met with by my ban, Bank of America, Fidelity (who manage my employee IRA) and they all tell me something different and do not guarantee a favorable rate of return for the 1% they charge. I am 82 years old and own my own home. I am a listener of you WGN and respect what you say.
Thank you,

Terry Says

Thank you for respecting my advice. I hope you will take it. Everyone you talk to wants something FROM you. I can’t give specific advice without knowing more about your situation, but I will say that you won’t lose a penny leaving the money in bank CDs (as long as you stay under the insured limit at any one bank). You won’t get rich — but you won’t get poor! I know rates are horribly low these days — the Fed is pushing them down. One day that will end, and in your lifetime I think rates will be double digit again!

What you must do right now is get some legal advice about making a new “estate plan” — a will, or better yet a Revocable Living Trust. Then you must re-title all your CDs in the name of your trust. You will name a successor trustee to take over if you cannot act for yourself — typically a trusted adult child. That should be your top priority — not investing, but setting up your own life so that if you die, or become incapacitated, things will go on as you want them to. That’s the first step.

If you would like to find a FIDUCIARY, FEE-ONLY financial advisor who promises in writing to put your interests first and only charge a flat fee, you can go to Wealthramp.com to be matched. Or, since you are in Florida, contact the absolute dean of financial planning — Harold Evensky. You can trust his firm completely.

Please write back if you have more questions, and you can email me at Terry@TerrySavage.com for a more personal reply. There is NO RUSH to do ANYTHING with your money.
But you CAN — assuming you have “extra” cash beyond what you will need for your lifetime =– open a 529 College Savings Plan account for each of your grandchildren– and put up to $15,000 in each account. Ask the people at Fidelity to set them up for you. There is no tax consequence for this gift — and the money can be used for any college in any state. In the meantime it grows tax-free for college expenses. Just don’t be in too much of a hurry to give it all away. The expensive health years are coming!



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