Today’s Prep:

Equipping Points:

Which of these things in the financial realm (and beyond) are overrated or underrated? We talk through a few common things to see what your level of hype and appreciation for them should be or how you should make changes.

To start, are you looking for a big tax refund in April? This is overrated because if you’re getting a big tax refund from the government, that means you are missing out on that money all year. You want to have either a small refund or owe a small amount of money. This can be done by adjusting your withholdings.

What about paying off your house early? Is this actually a good idea? When you enter retirement, you may want less debt. But don’t let having a mortgage payment be the one thing that will prevent you from retirement. It will get paid off at some point. Avoid taking money out of your IRA just to pay off the house early.

Look out for variable annuities because Eric calls them overrated. They sell you on a promise of “sizzle” for income opportunities and benefits. What they don’t tell you is what it costs to get that.

Finally, are Roth IRAs as good as people say? Anytime you control your tax rate in retirement is great. You pay your tax now so that you don’t have to pay your tax on that money later. Understand what you’re doing with any investment or assets. Reach out to Eric to do the retirement readiness review to analyze your future tax burden into retirement to see if you should do a Roth conversion or keep your plans on the trajectory that they are currently on.

Listen to the entire episode or skip ahead using the timestamps below.

1:09 – Over or under: getting a big tax refund?

3:23 – Is Star Wars overrated?

5:38 – Should you pay off your house early?

7:21 – Are variable annuities over or underrated?

9:39 – Who is a fan of mac and cheese?

10:49 – How do you rate Roth IRAs?

Today’s Takeaway: