Mailbag: “I think my ex-husband stole my identity, what can I do about it?”
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I would never put all of my money into an annuity. I don't think you should put all of your money into anything. You still need some money invested in the markets in order to keep pace with taxes and inflation. I definitely would not go down this road precisely because this money is pretty much all you have.

Hey everyone, thanks so much for joining us for a special mailbag edition of Her Money. I'm here with the fabulous Katherine Tuggle, Her Money's content chief. We are diving into some of your most pressing financial questions. And we're also rolling into the start of summer. I can't believe it, but yes, school is out in some places.

The grills are on. Catherine and I just got back from some much-needed getaways, so we've recharged, we're rested, we're ready to help you tackle some real-life money dilemmas. Oh, and before we jump in, a quick shout-out to a listener who recently left us a review on Apple Podcasts.

By the way, thank you so much for that. I know you are wondering, do these reviews actually matter? They really matter. Like people look at them. That's how they decide, hey, we're going to check out her money. So if you like her money, leave us a review. And they said they missed hearing more of our team tackle these mailbag questions together. We heard you. We love it when you leave us these reviews. We love

listen to these reviews and we react to them. And if you're so inclined, leave us a five-star rating on Apple Podcasts. Or if you've got a comment and you want to weigh in on something or a question, email us anytime at mailbagathermoney.com with your questions or your feedback. We appreciate both. Okay, Catherine, how you doing?

I'm doing great. It is great to be back on the mic with you answering some questions. I feel like I see so many questions pop in from the women in our Facebook group. And it's really, really nice to tackle some of the ones that we get on email, or sometimes we get them via DM. And I just love all the different ways that people know that they can find us.

Yeah, it's funny. I get very little in the way of actual mail these days, like the occasional catalog. But all my bills are on e-statement and e-mail.

Very few people, aside from you, write letters. I know that you still do. But I do feel like I'm still wildly available in all sorts of formats. So reach out. Completely. Completely. Should we dive in? Yes. Yeah, let's dive in. Our first question today comes to us from Jen. She writes...

Would a credit card company ever cooperate with a person to help track or at least narrow down someone who committed identity theft? Last fall, about a week after returning from a business trip, I came home to nearly a dozen letters from various credit card companies stating that I was declined for their credit cards. The letters all cited the date the applications were taken out in my name. Coincidentally, it was the exact same day that my husband filed for divorce.

This was also two days before he emailed to tell me that he wanted an immediate dissolution of our finances. I've never had an issue with identity theft, so I suspect that this is not a coincidence. I keep hearing that it's next to impossible to request assistance from the credit card companies and it's difficult to trace. However, I thought they may want to help in cases when the odds are in their favor. But are they? What do you think? Such an interesting question. First of all, I'm really sorry that this happened to you. This is

terrible. It's a hassle. And it's a hassle that I think Jen is probably coming when you need it absolutely least. Unfortunately, I don't think the credit card companies are going to help you. And I am putting myself in their shoes. I wonder if they would

rightly or wrongly suspect that trying to help you uncover this would be more of a liability to them than it's worth.

which is not to say that you don't have options. So any cases of identity theft should be reported to both the Federal Trade Commission and the police. You want to get a police report on this. And it is possible that you might get some assistance that way. I might, if you've got...

the money and you've got the desire, I might hire either a private detective or a forensic accountant. Often forensic accountants are really helpful in divorces that get ugly financially because they have ways of

tracing the flows of funds. And they can help you, for example, if you think somebody is hiding money. Make sure that you're able to put together a settlement offer or a divorce agreement that is, in fact, fairer on both sides. A private detective has ways of looking at

different records. They use Freedom of Information Act requests and other things to try to uncover what's going on as well.

I do want to make sure that your credit is frozen. If your credit is not frozen, please freeze it immediately. We've got a really, really helpful explainer at hermoney.com all about how to freeze your credit. It'll literally take you 15 minutes to do it, but that will ensure that nobody is able to take out credit in your name and everything

I imagine that by this point you have separated all of your finances and you're not depositing any more money into joint accounts. But if you haven't, please make sure that all of your money is going into accounts that only have your name on it. This is something you're going to want to talk through with your divorce attorney as well to see if there's any legal recourse. But that's where I would start. What do you think, Catherine? Any other suggestions?

Yeah, I mean, this is this is crazy. I would definitely start with the police report because I feel like somebody who would do this like this may not be their first rodeo, right? Like I worry about like his mom's credit or his brother's credit or like what else is he doing with people for whom he knows their social security number. So I would definitely start with the police report.

That is such a good point. One of the things people don't often realize is how often identity theft is perpetrated by people who actually know us, people who are in our lives, which is why it's important to keep all of those private documents really private because you never know when people are in your house what they're

happening to pick up, to read, to copy. That's how you can get in trouble when you don't expect it. So true. Great point. Our next question comes to us from Antoinette. She writes, Hi, Jean. My question is about taking early retirement or not. I turned 66 last December and will be eligible for full retirement in August when I'll be 66 in eight months to claim social security. But I'm in need of the money now. I work about 30 to 40 hours a week.

Should I take early retirement now and not wait until August and invest half of it into a Roth IRA? Thanks so much. So let's parse this out, right? I'm a little confused because...

To me, when you say early retirement, that seems to indicate stopping work. But if you're in need of the money right now, why would you stop working? Unless there is some reason that you can no longer work.

If that's the case, and we'll just do this in a couple of different scenarios, Antoinette, and you can pick the one that works for you. If you're no longer able to work and you need the money, then of course you take Social Security. You've heard me and I'm sure a lot of other people say it's best if you can wait from

age 62 until age 70 to take Social Security. And the reason for that is that although you're eligible to start your benefits at age 62, in most cases, your benefits grow by about 8% per year guaranteed until age 70.

which is a really, really great guaranteed return and why we suggest that you hold off if you possibly can. Now, in order for that calculation to work out in your favor, you need to live past your mid 80s. If you have a reason to suspect that you're not gonna live that long, then it does make sense to draw benefits sooner.

And if you need the money, then it makes sense to draw benefits sooner. But if you could continue to work a little longer and that would enable you to stave off Social Security, I would do that. And I also wonder...

why you would take early retirement and then invest the money in a Roth IRA, because that to me indicates that maybe you don't need it or you don't need all of it. I'd look for other sources of money if you're looking at something to just tide you over a little bit. If you own a home, can you draw out a little bit of home equity? If you...

have other savings. If you've got an emergency cushion, this is what an emergency cushion is for. If you've got other retirement assets, you are past the age of penalty and you could also tap into those. So be careful before starting to tap Social Security because it's a very hard thing, if not impossible thing to reverse.

Yeah, that's a great point, Jean. And I do think maybe the tidying over is the key here. It sounds like it. Something that can float her until she's a little bit further along. So yeah, good luck, Antoinette. And let us know if there's anything else that you have a question about and we'll elaborate. We're going to take a very quick break.

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Our next question comes from Dawn, who has a question about annuities. She writes,

I'm 57, single, and have a 403B from a previous employer with about $300,000 in it. I have a financial advisor who recommends that I move it into an index-linked annuity. I've done some research on these, and it does seem that they pay good commissions, which may be why he's recommending it. This money is pretty much all I have, so I'm concerned about losing it as I plan to retire in eight years. Should I just put it into a rollover IRA? Thank you in advance.

So Dawn, this is a, it's a really good question. I think that you probably know that I like annuities in retirement. I like them because they're

I think having enough coming in in the form of income that will last as long as you will on a guaranteed level to cover your fixed expenses is a really, really good idea. That said, I would never put all of my money into an annuity. I don't think you should put all of your money into anything.

you still need some money invested in the markets in order to keep pace with taxes and inflation. And I am highly suspect of this financial advisor who is recommending that you put all of it

in this annuity and think that you're probably right about the commissions. I don't know what the commission is on this particular product, but I definitely would not go down this road precisely because this money is pretty much all you have. Here's what I would do. I would take a step back

And I would think about your roadmap to retirement. This is something that we've been doing in the new finance fix classes that we've rolled out, which are essentially a pre-retirement checkup. We ask you to look really closely at a combo platter of

How much money you're spending on a regular basis? How much you can count on drawing from Social Security? How much you're likely to have in your investments when you get to retirement and how much income that will produce for you either in the form of an annuity or in some other way?

and whether all of those things combined work to give you a retirement that is sustainable over a good 30-year period. It's very tough to answer this question

in a vacuum without knowing the answers to those other questions. The money that's in the 403b, you could certainly put it into a rollover IRA. That is a fine place to start it out. And

Then you need to make some really careful decisions about how you want to invest that money, whether you want to invest it for growth, whether you want to invest it for income, whether

whether you want to use any portion of it to buy an annuity. But until you've answered those questions, I wouldn't make any moves. I would really, really take a good look at your entire financial picture first. And you can ask that financial advisor to help you look at your entire financial picture. Not all financial advisors are holistic.

But many of them will be able to help you do that kind of analysis and show you what sort of returns this money could produce for you down the line. Yeah, I feel like that in my mind has always been the main reason to have a planner is that they do have that 360 degree view on everything because I'm in the place now where I'm helping my parents manage their finances and

having their advisor there to talk about, okay, well, this is in the IRA and this is in the annuity and this is the property. It's just been so nice.

Yeah, no. And the thing is not all advisors do that, right? Some advisors really just want to work on your portfolio. That's not my preferred type of advisor. But it's important to understand who you're forming this relationship with and what they actually provide. Yeah, totally. All right. We have one more question.

Great. This one comes to us from an anonymous listener, which we always welcome. They write, Hi, Jean. I'm a late bloomer to your show, but I've been listening every morning on my way to work. I am now up to the 2017 episodes, and I have already learned so much. I am very excited to catch up to modern time recordings.

Thank you for binging. That's amazing. They write, I'm 37 and desperately trying to fix both my own and my mother's financial situation. Her significant other recently passed and she received around $50,000 from his life insurance. She's 64 with no retirement or savings. I'm hopeful she can continue to work until she's at least 67 as I cannot afford to take care of her.

My question for you is, would the lump sum of money be better off paying off her mortgage, which is what she wants to do, she owes a little over $60,000 at this point, or should it go into some kind of savings or investment account, which is what I think she should do? My partner thinks it's pointless at her age to put the money into an investment account, but I'm hopeful that she can continue to not touch it for many years if she's able to survive off Social Security.

Thanks in advance for any help and advice. And thank you even more for all that you do. You are a saint. Oh my goodness. Well, thank you. Thank you so much for the compliments.

I gotta say, I'm with you. I don't think that your mother should take this money and use it to pay down her mortgage. And here's why. I have several reasons. The first is, you didn't say what her mortgage rate was. But assuming she's owned this house for some time, she...

she had a lot of years to lock into a really, really low mortgage rate through some sort of a refi or even through her original purchase. By investing this money, if she's got a mortgage in the three or 4% range, she's gonna do so much better long-term letting this money grow than she is using the money to pay off her house.

Also, reason number two, you say this money is essentially all she has, which means she doesn't have money to deal with any sort of emergency, a life emergency, a health emergency, a house emergency. If she has an emergency, what's she going to do? She's probably going to end up putting it on a credit card or asking you for money, which is

tough given your own financial situation. Using a credit card to pay for an emergency and then paying credit card interest rates on that emergency is gonna be much, much more costly than using some of this money that she's been left. And finally, if we look at average market rates of return over time,

She actually can grow this money. The historical rate of return on the S&P is somewhere around 10%, which means the market basically doubles every seven to eight years. Your mom is 64 years old. So in eight years, she's going to be 72 years old. That 50,000 could be 100,000.

And in eight more years, when she's 80, that could be $200,000. And maybe she will have to use a bit of it. But maybe Social Security will continue to tide her over at that point. And she will have allowed this nest egg to grow for her. So here's what I would do. I would look at your mother's monthly cost of living. And I'd take...

enough to cover three to six months worth of that cost and park it in a high-yield savings account take $10,000 as an example 10 to 12 park it in a high-yield savings account I take the rest and I would absolutely invest it for some sort of growth and continue to pay off her mortgage on the schedule that she's got

And I hope that's helpful. Yeah, that's great advice, Jean. I was just thinking, you know, in the event that she can live on Social Security for a few years, the market really could have delivered some good returns for her. So it's never too late. Obviously, the earlier the better for seeing real, you know, gains, but it's never too late.

Yeah, and at her mom's age, I would not put the entire thing in stocks. I would put it in a 60-40 portfolio. So if you put...

60% of it in a total stock market fund and 40% in a total bond market fund where the costs are low. You should be good long term. Yeah. Yeah. 64 is young. Yeah, it is. I am 60 and I think 64 is very young. It's very young. You're looking better than ever. People can't see on the podcast, but Jean, Jean is killing it at 60. Yeah.

Gina's blushing. But if you have any other money-related questions, we would love to hear from you. Send them our way by emailing us at mailbagathermoney.com. Thank you so much, Katherine. Great to see you as always. Thanks, Jean. Thanks for listening, guys. If you loved this episode, please give us a five-star review on Apple Podcasts. We always value your feedback. And if you want to keep the financial conversations going, join me for a deeper dive.

Her Money has two incredible programs, Finance Fix, which is designed to give you the ultimate money makeover, and Investing Fix, which is our investing club for women that meets biweekly on Zoom. With both programs, we are leveling the playing fields for women's financial confidence and power. I would love to see you there.

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