Do you have a lot of stuff? If you said yes, you are not alone. 60% of older Americans think that they have too much stuff. We’ll take a look at an article that addresses this problem in the Retirement Headlines segment today. I also have 2 listener questions that I will respond to. But before we get into any of that I would love it if you could help me out and take our annual listener survey. After you take the survey, press play to learn more to help you make the most of the only retirement you’ll get.

I would love it if you could help me out and take our annual listener survey. Share on X

Outline of This Episode

  • [2:42] How to get rid of stuff
  • [10:09] The 5-year conversion rule
  • [15:39] Guyton-Clinger rules

We’re ready to hear your voice with our annual listener survey

Before we get into our Retirement Headline, I would love it if you could help me out and take our annual listener survey. This 10 question survey only takes a few minutes and it helps me guide the topics of the show next year. You can tell me what you love and don’t love about the show. You can also voice your opinion and let me know what kind of topics you’d like to hear more about. I’d love to hear all of your opinions, so please make your voices heard by responding to this survey!

Early retirement provides a window of opportunity for downsizing and shedding away those things that you don’t need anymore. Share on X

Do you have too much stuff?

I am like most people in America, I feel like I have too much stuff. But with 6 kids at home, I’m just going to have to deal with it for a bit longer. Recently, I came across an article that had an interview with the author of Downsizing. The interview with the “King of Downsizing” highlights why we have so much and what we can do to get rid of it.

He remarks that early retirement provides a window of opportunity for downsizing and shedding away those things that you don’t need anymore. Once people reach their 70s, 80s, and beyond the ability to stoop and crouch can be limited which can make downsizing much more difficult.

Tips for downsizing

When we finally decide to relinquish our possessions there is a hierarchy of ways to part with them.

  1. Give it away – when we pass on a special object to someone who shares a similar attachment to the item it makes everyone happy.
  2. Sell it – if the item still has some value then selling it is a great option.
  3. Donate it – giving the item to someone who needs it more can still make you feel good.
  4. Throw it away – this sometimes has an added cost to it. You may need to pay someone else to help you get rid of it.

Often the downsizing process takes between 2-6 months. The experts recommend giving yourself a deadline to complete the process. This article had some interesting ideas that I hadn’t thought of. Press play to hear advice for receiving your parents’ stuff.

What triggers the 5-year rule? Share on X

A 5-year Roth conversion rule clarification

Gerry had a question about Roth contributions and conversions after age 59 ½. We all know that after age 59 ½ we no longer subject to the early withdrawal penalty, but what about the 5-year rule? What triggers the 5-year rule?

The 5-year rule can be a bit confusing, so here are the basics. At age 59½, you can withdraw both your contributions and your earnings with no penalty provided your Roth IRA has been open for at least five tax years.

The 5-year rule is triggered by three circumstances:

  • You withdraw earnings from your Roth IRA
  • You convert a traditional IRA to a Roth IRA
  • You inherit a Roth IRA

Are you curious to find out what you can do to make sure that you have no issues with the 5-year rule? Make sure to listen in to hear the full answer to Gerry’s question and you’ll also learn what kinds of funds you can use to build a Guyton-Clinger model.

Resources & People Mentioned

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