Transcript Episode 132: Key Questions

Listen to this Podcast

In this Podcast:

  • Required Minimum Distributions (RMD)
    • You’re required to distribute money out of your pre-tax accounts when you hit 72
    • You must take your first distribution out by April 1st in the year following the year you turn 72.
    • You don’t want to be in a situation having to take two distributions in the same year because they’re taxable
  • Helping people be proactive – the All Hands Analysis Team
  • Do I have to take distributions from each of those accounts?
  • 403b
  • If you have multiple 401k plans, you DO have to take a distribution from each.
    • do I want to position these not as 401K’s anymore?
  • For most employer plans, once you hit 59½, you can do an in-service distribution and self-direct your 401K.
  • QCDQualified Charitable Distribution.


This is Retire South Shore Radio, a weekly program designed to educate you on all your retirement options and introduce you to mark Rowlette, founder of South Shore Retirement Services for the latest on free seminars. To obtain a report or to set up a consultation, please visit Retirement Services and real-world retirement solutions. Looking at the whole picture to design a complete strategy, including retirement planning, Medicare decisions, and legal documents. Now, here’s Mark Rowlette. And your host, Jordan Rich.

Host Jordan Rich

Hello and welcome. This is Retire South Shore Radio. I’m Jordan Rich and it’s always a pleasure and an honor to sit down with my friend Mark Rowlette, the founder and president of South Shore Retirement Services based in Hingham, with a terrific office staffed with great people, part of the All Hands Analysis crew and of course, helping people all over and through this radio show, providing you great information. Mark, wonderful to see you as the summer slowly winds down.

Mark Rowlette

I know I hate to think of it that way. Although Lauren keeps telling me, she’s like “it’s summer, it’s not over. Just because the kids go back to school doesn’t mean that the summer is over.” And I still feel like I kid myself when September starts to loom in front of you. And you’re like, “Oh, back to school. So it’s been a great summer.”

Host Jordan Rich

But by the way, one of the perks of having your own radio show which you had now for four years, you can say happy birthday to your wife on public airwaves.

Mark Rowlette

Yes, it was Lauren’s birthday on Friday. And she just keeps getting younger and looking younger. And I say all this stuff she wrote down for me …

Host Jordan Rich

Good man! And I’m telling you, you get a lot of points when you wish your wife a happy birthday on your radio show. But trust me.

I’m usually the one asking the questions, of course. But today, we’re going to hear from you, what you hear from the folks who you meet for the first time, or from regular clients, or from those who are thinking about doing something in retirement. We thought we’d sort of tap into the questions of the public, so to speak. And I think this will be pretty interesting. So you’ve got a list? And I’ll let you take the first one right off the bat.

Mark Rowlette

We meet so many people on a weekly basis, and lots of them have the usual questions, and some are a little bit more unique. And I thought it would be just a good show to address some of the questions, maybe give some case studies without obviously mentioning names of people that we’ve met with recently. They have something that might be burning a hole in their head. And that’s what we try to  address for them day in and day out.

Some of them are obvious, and some of them are the things that people would think about. People ask about required distribution all the time. They ask about the forced distribution, whether you look at it that way or not, that you have this pre-tax money, like 401K’s, IRAs, 403B’s – something that you’ve basically been building for your career for a lot of people.

And you get to a certain age, which recently changed. And the government says, “All right, now it’s time to start pulling money out of those accounts and start paying some taxes and either use the money or don’t use the money.” But you still have to take it out. So I just thought we’d talk about the basics.

What is required distribution? Well, required distribution is you’re required to distribute money out of your pre-tax accounts when you hit 72. It used to be 70½, but in 2019 the Secure Act was passed and came into force January 1, 2020. And if you were not 70½ already, then you fell into the new category. If you were already 70½, then you were in the “old rules”.  Where you were taking distribution based on 70½, you couldn’t stop and go on to the new rules.

If you’re in that “little sweet spot”. We used to joke about it. I worked with some people who are a little bit older back in the day. And I remember them telling me that when America went from having a beer when you were 18 and they changed it to 21. That was like those people who were in that would like that middle group. They were like, “well, what do we do now? With required distributions different, you’re either in the old rules or in the in the new rules.

So when do you have to start? Well, you’re meant to take your first distribution out by December 31 in the year that you turn 72. You can postpone it till April 1st the following year, for the first year that you’re doing it, but then you are required to take two distributions out in that year. So I think it’s important that you stay ahead of that and get on top of it. Because maybe you don’t want to be in a situation that you’re having to take two distributions because they’re taxable, and they might have negative tax implications to you in that given year.

Host Jordan Rich

And that strongly suggests why it’s so important to do some planning when you’re in the retirement world, because these are big issues that you don’t think about. I don’t even think about them, and I’m closer to retirement than you are. But they are going to come up and they’re going to happen. And it’s a big financial decision and move to make, as to where and how you want to take that distribution. You do have to take it.

Mark Rowlette

Yeah, there’s a lot to consider. It’s not just as simple as “Alright, I’ve got to do it so I’ll just take the money.” Like you said, a huge part of our business is helping people be proactive, because lots of people are retired well before 72. And there are lots of things that you can do.

We talk about Roth conversions, taking pieces of your IRA money out in the low tax bracket environment that we’re in now, and potentially taking advantage of whatever tax band a client or clients are in, to pull money out that maybe you don’t even need, but you’re able to do a lot more tax strategy with that.

Obviously, I can’t give tax advice, but that’s part of the All Hands Analysis team, we have an alliance with a team of CPAs that can give the tax advice. We just help people build those strategies. But there’s a lot to required distribution. People look at it and say, “Well, geez, I’ve had, you know, five different jobs over my lifetime, and I’m still concurrently working…”

Maybe I’m over 72. At that point, what do I have to do? Do I have to take distributions from each of those accounts? It gets a little bit complicated, to be honest. If you have multiple IRA accounts, specifically IRA accounts, the government says, “Well, you have to take a required distribution based on each of those accounts.”

But you don’t have to take it from each of those accounts, you can just choose to say, “I have five different IRAs, I have to take $1,000 from each of those IRAs’ total value, I’ll just take the $5,000 from one account, and let the other accounts sit and continue to grow. Because maybe they’re doing really well, maybe they’re not doing well. And you don’t want to necessarily have to pull that money out of an account that’s down.

The same applies for 403B‘s for educators, and people who work in hospitals, people who have 403B plans, you can compile and say “I have multiple 403B plans, but I’m just going to take the required distribution to satisfy all of them from one account.” However, that doesn’t apply to 401K plans. If you have multiple 401k plans, then you have to take a distribution from each of those 401K’s. So it might make sense to start looking at those ahead of time and saying, Well, do I want to position these not as 401K’s anymore? Do I want to have them as IRA accounts going forward?

So there’s a lot to consider. One of the questions (and I thought I’d bring up a quick case study on this)  is “Are there any exceptions to this rule?” And there are a handful of exceptions. The biggest one that we come across is like a couple I was with recently.

The husband is already 72. He has had a couple of different jobs, but he had a large amount of money in his 401k with his current employer. And his plan is to continue to work for the next five years. And he said their former broker was very, very anxious to do what we call an in-service distribution. An in-service distribution is, for most employer plans, once you hit 59½ (and we do this a lot), you can self-direct your 401K.

You can take that money, the vested balance from your 401k, roll it over to an IRA, and you go from maybe reducing your fees, but certainly to giving yourself more options where you can invest the money. Because the 403B generally has a menu of whatever that 403B provider will offer. But there’s obviously a world out there of different strategies, different investments, different tools that you can use. So a lot of the time people roll that money out. And they put it into an IRA.

So this guy’s broker, or former broker, I should say, because he works with us, was very anxious about doing that. He just wanted a second opinion. He came to a tax strategy webinar that we were giving, then came into the office and I said, “Well, the one of the exceptions to the required distribution is if you have a 401k with your current employer and you’re still actively working there, then you are exempt from having to take a required distribution from that money. And I said, “so by rolling that money out to an IRA, you’re actually creating an extra tax liability that you don’t need to have.”

So we would leave that money in the 401k for this particular individual, until such time as he actually retires because you can still take money from it if you need money. There are slightly different tax implications to distributions from 401K plans. But the bottom line is, he got to have more choices. And somebody in my opinion was maybe being a little bit self serving by saying “let’s move that money out.”

Of course, we want to manage the accounts for him because that’s what we do for a living. But you have to do the right thing for the client at the right time and that was not the right thing to do in my opinion. We left that money in there. So there are some of those exceptions to it.

Host Jordan Rich

As we discuss these general questions that the public has and potential clients and non-clients have, there is an opportunity for you to target a more specific, specific question to Mark and his team. It’s called a 15 Minute No Obligation Strategy Call, a chance to get your questions answered directly.

And you can set up the call, there’s an appointment for it and you’re on the phone at home or wherever, it’s very easy on your part, to set it up at 781-836-4214 or visit There’s an easy calendar grid system to do just that.

What you just answered was in general terms. I can imagine people would have offshoot questions, because that’s the way it works. And everyone has their own unique set of circumstances.

Mark Rowlette

There are a lot of similarities between people’s retirements, but everyone is unique. So I would definitely seek people’s professional advice.

Host Jordan Rich

The 15 Minute, No Obligation Strategy Call. Go to to set that up. Mark, we have a couple of minutes left in this segment. Is there anything else to add when it comes to RMD?

Mark Rowlette

There’s one other thing that I think is really important and powerful. For the right individuals, this can work really well for them. Lots of our clients give to charity. Lots of our clients look at the church that they’re involved in, or some sort of entity that they’re involved in, and they want to give money to charity.

And when required distribution comes around, well, a lot of our clients miss opportunity here until they come into the office. There’s a thing called a QCD. It’s a qualified charitable distribution. And what is that?

Well, many people who go into retirement are not itemizing their deductions. They’re just taking a standard deduction. When you take a standard deduction, you wouldn’t be able to show any charitable contributions that you’re making. Because you’re taking the standard. Well, the QCD allows you to give money from your IRA directly to a charity of your choice or charities of your choice without actually having to put it on your tax return. It doesn’t have any impact. It basically goes directly to the charity.

You still get to take that tax deduction, essentially. You’re not paying taxes on it, because you’re giving it to the charity. For a lot of the people that we talk to, that is something that they’d never heard about. It also satisfies required distribution. Now there’s a certain schedule that you have to do it. How you take the money out is very important to make sure that you’re doing it correctly. But a lot of people, don’t even realize that they can do that. So they’re taking their required distribution, and they’re grabbing cash from somewhere else, and they’re giving money to the church. So a QCD can really work well, for a lot of people.

There’s a limit to how much you can do. But for most people that we work with the limit is pretty good. It’s $100,000 per taxpayer per year. Now, most of our clients are not giving that much money to charity, but it’s just these little things that can add extra value to a person’s bottom line and it allows them the comfort of knowing, “Alright, well, I’m going to earmark X amount of money to the church this year. So let’s just get ahead of it. Let’s just do it at the beginning of the year, give it to the church” and satisfy the required distribution at that point.

Host Jordan Rich Outstanding. We have more general questions that come in to Mark on a regular basis coming up. When we continue, don’t forget to check the website for much more on and we’ll be right back.

[Begin pre-recorded segment]


One of the biggest stressors when it comes to retirement is the obvious one, will you ever have to worry about running out of money in retirement?

Host Jordan Rich

That is the key question and proper retirement planning. Working with the All Hands Analysis team can truly help. Here’s Mark Rowlette, founder and president of South Shore Retirement Services.

Mark Rowlette

Most of our clients have a person, when we meet with them, somebody who has helped them accumulate their wealth during their working lives. But distribution going into retirement, starting to take money out of these accounts is a totally different animal. It’s not just about returns. Returns are important, but strategizing on what’s the best way to take this money out, how you should take it out, when you should take it out, and where you should take it from – is critically important when you’re transitioning into retirement.

Host Jordan Rich

Schedule your free 15 Minute Strategy Call today just visit That’s investment advisory services made available through AE Wealth Management LLC, AEWM. AEWM and Seltzer retirement services are not affiliated companies.

This is Jordan Rich reminding you that South Shore Retirement Services offers a number of ways to learn about a happy and safe retirement with frequent evening seminars at local fine dining establishments.

You can find the complete schedule and register for the seminars at There are also regularly scheduled webinars. There’s the Retire South Shore podcast series and the South Shore Retirement Services newsletter. Information is power, and the All Hands Analysis team at South Shore Retirement Services is ready to inform, educate and reassure you in retirement. Again, visit

[End pre-recorded segment]

Host Jordan Rich

Welcome. This is Retire South Shore Radio. I’m Jordan and of course, I’m with Mark Rowlette, the founder and president of social Retirement Services. I love it when we just talk about what the folks are talking about. And that’s what we’re doing today, questions that Mark receives and his team, the All Hands Analysis team, receive on a regular basis. We covered in the first half a very important one, which is required minimum distributions. That’s a show in itself. But there are many other questions that you get on a regular basis, what would some of those be?

Mark Rowlette

Another one is, “I’m retired now, should I pay off my mortgage?” I’ve had lots and lots of people come into the office and say, “I’ve got a mortgage,” and it doesn’t necessarily have to be hundreds of thousands of dollars. “I’ve got 50,000 left on my mortgage, should I pay it off?” Or, “we refinanced when the interest rate market was really good, and we’ve had a 15-year mortgage? Should we pay it off?”

The simple answer is, it really depends on where you’re pulling the money from to pay it off, right? What money you’re going to use to pay that off sometimes dictates whether it makes sense to do that. And what do I mean by that?

Well, if you’ve got $75,000 sitting in a savings or checking account. While rates have gotten better, a lot of the banks just haven’t really progressed to the better rates. You’re making 0.25% in that in that account, and it’s not money that you’re really going to need. You’re scared to put it into the stock market, because the market goes down sometimes, and you don’t want to take risk with it. And your mortgage is costing you 3.5% percent.

Well, mathematically, that makes sense, right? You’re cutting out the middleman, you’re saving yourself the return that you’re paying to the bank. You now no longer need that income amount to pay the mortgage off on a monthly basis because it’s gone. So in that instance, yeah, it might make sense.

But there’s a flip side to that. You may like to be invested in the market, (in the compliance side of things, everyone knows past performance does not dictate future results). But the market generally does better than what a mortgage would cost you. So, maybe in a certain situation, it doesn’t make sense to pay it off.

Take that money, invest it in whatever way you feel comfortable, and have the return that that money is making. Pay the mortgage off, or have it pay the mortgage on a monthly basis for you. Because then at the end of the day, if it works out for you, not only have you paid your mortgage off, but you still have that money. The real downside of doing it is that you’re giving up liquidity if you just write a big check to the bank.

For a lot of people, when you start looking at how mortgages are amortized, they don’t realize that if  you have a 3.5% percent mortgage, it’s not that you’re paying an equal amount of principal and an equal amount of interest every single month. How they monetize it is interest upfront, right, you see that when you first got your first mortgage, you barely chipping away at the principal initially. So then when you get towards the tail end of the mortgage, you’re paying very little interest and a lot more principal. So maybe you’re not actually being charged at that point, you’ve already paid your interest at that point. So now, maybe it doesn’t make sense to do it (pay it off).

Again, everyone’s situation is so unique, that it really is a case-by-case basis. We talked before the break about required minimum distribution. We’ve had clients that are 68 or 69 years old, they’re retired, or they’re just retiring. And they said, “Well don’t pay the mortgage off to get rid of it. Look, I’ve plenty of income with my Social Security and with my pension plan so I just want to pay it off.

And I said, “Well, you’ve also done really well in your 401K plan.” I’ve had this happen a handful of times. It happened a couple of weeks ago with a particular client that we were working with. I said, “you did really well in your 401K, because yeah, it’s great. You’re going to have required distribution coming up in a couple of years. It’s going to force you to take money out of that account that you don’t need, that we cannot Roth convert.” There’s lots of strategies we can utilize.

But why don’t we look proactively? This is going to create additional income, so we’ll use that additional income to pay off your mortgage. Then we don’t have to write a check out of your brokerage account, which is a non-IRA account, lose that liquidity and then still have that extra income coming in down the road. So again, sometimes looking proactively at that will allow somebody to make a better, well-informed decision.

Host Jordan Rich

I think you ought to have a big letter P on your shirt when you’re wearing your cape and flying through the air. Proactive. That’s the key. And I was thinking, “Proactive Man”. I was thinking as you were saying that about the variables and about the immense amount of opportunity people have that they may not be thinking about as they approach retirement. It’s not for everyone, but for many and I think that’s the reason you have to ask these questions.

And as we’re doing, as you’re listening, and as you’re thinking about any of this stuff about your own situation, and you just want to get a quick answer, or at least some basic information about you, the 15 Minute No Obligation Strategy Call is available. Set it up. It’s definitely worth it. The appointment schedule is the way to do it. You know when it’s going to happen, you’ll know that you have somebody on the phone to talk to. And to do that, go to We urge you to do that, and it’s a great, great service. So what are some of the other things that you’re hearing?

Mark Rowlette

Those are kind of the biggies, and they’re a little bit more detailed, but I wanted to get through some of them and  – you’re not wrong, we want people to reach out and let us go down through this 12 or 13 of them. You know, me, I’m so long winded and I keep talking. The usual questions,

How do I figure out what income I need?

How do I figure out what I need in retirement?

The rule of thumb starts at like, 75% of what you were making. But I hate rules of thumb, because they’re generalized, and you can’t generalize this. So it’s a good place to start. But we like to look and try and personalize it more.

Look at what you’re spending money on.

Is that going to change in the future? Meaning what we just talked about – mortgages.

Do you have a mortgage?

Are you going to keep paying, it isn’t going to be paid off in 3, 5, 6, 7 years?

Is that’s going to change your income needs?

Do you have kids that are still maybe financially slightly dependent on you?
Lots of clients do. I have three of my own that will be financially dependent on me for quite a while. We have lots of clients that have kids that are still on their phone bills, or on their health insurance when they go into retirement, and that will change in the future, which will change your income need.

When you start to take required distributions:
Are you going to need that money?
Is that going to increase your gross income and you don’t need that money?

So that’s going to dictate what your retirement income is, as you transition. The bottom line is that everyone’s budget is different. We did a show before and we had a white paper on “I need $85,000 in retirement. And this is what I have, am I going to be okay?”

Everyone’s budget, everyone’s spending habits may be similar, but they’re all unique. So what we try to do is tailor and drill down on what they’re spending money on. We’re not trying to put people on a budget. But it’s the only way to kind of plan and map out your future. Lots of people are really scared and nervous going into retirement, and it’s not just because what’s going on in the world today. It’s because they’ve never been in a situation where somebody’s not cutting them a paycheck every other week or every month.

Right now they have to create their paycheck and they want to know “what do I need the paycheck for?” Because there’s no point in saying, “Well, I think I need $10,000 a month” when you only need six, because now you’ve just created an extra $4000, maybe, of taxable income that you don’t need. You can always go grab it. It’s your money, but be efficient with your money.

Again, be proactive. Look down the pike at what’s going to happen in the future and map it out that way. And that’s what we would help our clients with.

Host Jordan Rich

The question I would have is probably the universal question, is this going to work out?

Am I going to be okay, are we, my wife and I, or my husband and I, whatever the case, are we going to be okay? Because this is uncharted territory. Even if we have a lot of paperwork in front of us and read the newspapers and read the Wall Street Journal, we’re still taking a step into a whole new place a whole new horizon.

Mark Rowlett

The money is obviously a resoundingly important part of people’s retirement – the filing of when you should take Social Security. The simple non-financial things, there are some non-financial, some financial question is for a couple, “Should we retire at the same time?”

But it all drills down to the same thing. It doesn’t matter whether you need $5,000 a month or $50,000 a month, people want to make sure they’re going to be okay. They want to make sure that they’re not going to have to worry about this because, walking out the door and retiring, you can’t necessarily unretire and go back to the boss and be like “I made a mistake, I want to come back”. Maybe you can. But for most people you can’t. So, to me is the most important thing is, “Am I going to be okay?”

When people say that to us, I know that they’re thinking about the money. But we’re also thinking about the psychology of it. It’s a really difficult transition to work full time or do something with the big part of your life 20, 30, 40 years – and then not do it anymore. So to add any additional stresses that are controllable, we think are unnecessary. So through our All Hands Analysis, looking at all of these things, and you know, quite honestly telling people or guiding people on concepts, issues, timing of when to do what and why – of a lot of things that they’re not even thinking about. That’s the bigger part of it.

Host Jordan Rich

It’s important to remember, and it’s important to have you restate this. We’re not just talking about people who owned businesses and have millions or even hundreds of thousands, we’re talking about anyone who’s had a working career. Anyone who’s done any amount of work and saving along the way, has an option has an opportunity to enjoy the kind of retirement they hopefully can aspire to.

Mark Rowlett

It doesn’t have to be a stressful conversation. It doesn’t have to be a negative conversation to sit down with somebody like myself or somebody on our team. Because it’s going to happen at some point, right? People retire, for the most part. Everyone retires at some stage. And you want to map out how that’s going to look for you and your family, to make sure that you’re in a good position to do it.

Host Jordan Rich

Absolutely. And opportunities to ask questions beyond the 15 Minute, No Obligation Strategy Call, Mark. Obviously, consultations are welcome and seminars and webinars, will be starting up again in the fall with lots of these opportunities for people to come in. And I imagine you hear these questions quite a bit when you gather in public.

Mark Rowlett

Yeah, a little break in August from doing face-to-face seminars for no other reason that it was just really busy in the office. We had some new staff members join us, Linda Curry joined us with a wealth of experience planning events. We wanted to take a little time to work on that. We still did webinars, and we still do webinars every other week. But yeah, it’s a great opportunity at any of these events for people to ask specific questions about their situation. They’re welcome to come into the office. As you know, we build these strategies, we don’t charge to do that, we feel that the right thing to do is kind of lay out all of the options for someone or a couple, before they would make a decision as to whether they want to work with us or not. We have a wonderful client base, and many of these clients have watched me grow, and my kids grow up. And they’ve worked with us for more than a decade. And it’s been a really great experience.

So we welcome people to come in, call in and ask questions.

Host Jordan Rich

The best part of it all, and we’ve said this in the past as well, is that if you don’t ask, you don’t get the information. And so often people are pleasantly surprised when they start inquiring. That’s the beauty of this. It’s not the likelihood you’re going to have bad news. It’s likely you’re going to have better news, certainly.

Mark Rowlett

I see people very emotional when they come into the office, and sometimes even more emotional when they leave. But that’s generally in a good way, because they really had no idea. You go with your car to a mechanic if it’s broken, and you’re like, oh my gosh, what’s this going to be? And then they’re like, Oh, it’s just this it’s $15 or something. It’s like that wonderful, relaxing weight off your shoulders. And when you’re dealing with retirement and the next chapter in people’s lives, that’s a really really, really stressful situation for people if they don’t know how they’re going to navigate through it.

Host Jordan Rich is the website. Do check it out. Happy birthday, Lauren. belated Thank you.

And Mark, we’ll see you next week, thank you.

[End interview]


Investment advisory services made available through AE Wealth Management, LLC (AEWM). AEWM and Rowlette and Associates, LLC DBA: South Shore Retirement Services are not affiliated companies.

This Firm offers insurance services. Investment advisory services offered only by duly registered individuals through AE Wealth Management, LLC (AEWM). AEWM and Rowlette and Associates, LLC DBA: South Shore Retirement Services are not affiliated companies. Investing involves risk, including the potential loss of principal. Any references to protection, safety or lifetime income, generally refer to fixed insurance products, never securities or investments. Insurance guarantees are backed by the financial strength and claims paying abilities of the issuing carrier.

This podcast is intended for informational purposes only. It is not intended to be used as the sole basis for financial decisions, nor should it be construed as advice designed to meet the particular needs of an individual’s situation.

Mark Rowlette and Associates, LLC DBA: South Shore Retirement Services is not permitted to offer and no statement made during this show shall constitute tax or legal advice. Our firm is not affiliated with or endorsed by the U.S. Government or any governmental agency. The information and opinions contained herein provided by third parties have been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed by Mark Rowlette and Associates, LLC DBA: South Shore Retirement Services.


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