Ask Liz Weston

Get smart with your money

Q&A

Q&A: I’m 59 with no retirement savings. What now?

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Dear Liz: I’m 59. In 8 years, I will qualify for an average Social Security income. I have no retirement saved and am not a homeowner but I have been blessed with a modest inheritance. What financial advice would you give in this situation?

Answer: The most powerful action you can take for your future retirement is to delay your Social Security application as long as possible, preferably waiting to apply until your benefit maxes out at age 70.

Each year you delay after your full retirement age of 67 will add 8% to your checks — a guaranteed return that can’t be matched anywhere else. You also don’t have to worry about missing out on inflation adjustments, since those are added into your benefit starting at age 62 whether or not you’ve applied.

Applying early stunts your benefit for life. The longer you live, the more likely you are to run through your other savings, so a maximized Social Security benefit is the ultimate longevity insurance.

If you’re married and the higher earner, your benefit also determines what the survivor will get after the first spouse dies.

Other smart moves would be to start saving what you can for retirement and get your inheritance invested properly, so that your money continues to grow. Consult a fee-only financial planner or an accredited financial counselor for help.

Q&A: How to avoid or reduce taxes on required minimum distributions

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Dear Liz: I’m confused about required minimum distributions from my retirement accounts. I’d like to avoid taxes on my withdrawals, but it seems there is no way to avoid them. Please give me some guidance.

Answer: If you got a deduction for contributing this money, and you want to keep the funds you’re required to withdraw, then yes, you have to pay taxes on these distributions.

Required minimum distributions from retirement accounts currently have to start at age 73. There are a few exceptions. Roth accounts don’t offer deductions on contributions and also don’t have RMDs. You can postpone RMDs from a workplace plan such as a 401(k) or 403(b) as long as you’re still working for the employer that sponsors the plan, the plan offers this “still working” option, and you don’t own 5% or more of the company.

If you don’t need the money, you could consider donating your required minimum distribution to charity. Known as “qualified charitable distributions,” these donations can start as early as age 70½. As long as the money goes directly from an IRA to a qualified nonprofit, you can avoid paying taxes on the distribution. For 2025, the maximum qualified charitable distribution is $108,000 per individual. (You can’t make a qualified charitable distribution from a workplace plan, but you can roll some or all of the account into an IRA and make the donation from there.)

Sometimes RMDs can be large enough to catapult savers into a higher tax bracket and trigger higher Medicare premiums. If that’s the case, and you’re still a few years away from starting RMDs, consider talking to a tax pro about ways to manage the tax bill. Starting distributions early or converting some funds to a Roth IRA might be options.

Q&A: How do you force heirs to pay?

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Dear Liz: My husband and his six siblings inherited a large family farm. No one lives there; it is used recreationally. Our limited liability corporation is set up so that only blood relatives can inherit. If they don’t want it, they can sell their share (only to family) for 40% of the value. The seven current owners all pay equally for the upkeep.

Our question is what to do with the next generation if some don’t want to pay their share of the upkeep, and also don’t want to sell. This is a very likely scenario. How to “force” them to pay? About half of the grandchildren (13 of them) will be all in, the other half probably won’t care to pay. My husband and I are the youngest of the owners, and we most likely will need to deal with this someday. If you don’t have a solution, what type of lawyer would be best to consult with?

Answer: It’s impressive and perhaps even astonishing that seven people have been able to successfully share ownership of this property so far. Expecting the next generation to do the same, with nearly twice as many people involved, is almost certainly asking too much.

An experienced estate planning attorney can offer suggestions on how to manage this property and address options if heirs don’t pay their share, either due to unwillingness or inability. (Keep in mind that heirs who are ready to pay their fair share now may not always be able to do so if their economic fortunes change.) Most likely, forcing payment would require the cousins to resort to the courts, so the current owners need to think deeply about what’s most important: keeping this property in the family or preserving family harmony.

Q&A: Bank dragging its heels on reimbursement for forged checks

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Dear Liz: I am a victim of check fraud where someone intercepted two checks made out to the U.S. Treasury and changed the payee name. These two checks were for $21,000 and $6,000, so it’s substantial. I made a police report and spoke with my bank at the end of August. Any advice on how to push the bank to reimburse me? I hate being in limbo!

Answer: A bank generally has 10 business days to investigate unauthorized transactions. If the bank can’t complete the investigation in that timeframe, it’s typically supposed to issue you a temporary credit. If your bank isn’t following the law, you can file a complaint with its regulator. National banks, for example, are regulated by the Office of the Comptroller of the Currency’s (OCC) Customer Assistance Group.

As mentioned before, check fraud due to mail theft is a huge issue. Sending checks through the mail isn’t safe, so please switch to electronic payments whenever possible.

 

Q&A: Unwanted timeshares granted back to developers

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Dear Liz: I successfully granted back seven timeshare properties in different locations that my father had bought over the years. In several cases, the companies were very unhelpful over the phone, but responded once I wrote a letter explaining my father’s age and inability to travel and requested to grant back the deed. It seems all of the companies have a process for doing this, but won’t reveal it over the phone. I had to pay administrative fees and some other costs ($500 to $1,000 per timeshare), but it was worth it to eliminate the yearly maintenance fees.

Answer: Thank you for sharing your experience. Far too many older people continue to pay maintenance fees long past the point where they can enjoy their timeshares because they don’t see a way out. The timeshare companies usually insist the fees must be paid “in perpetuity.” Failing to pay can lead to collection action and damage to your credit score. Desperate timeshare owners are often targeted by scam artists and unethical companies that fail to deliver on promises to get them out of their contracts.

In reality, many developers will take timeshares back under the circumstances you describe. Owners may be able to sell or give away their timeshares using sites such as Timeshare Owners Group and RedWeek. Or they can simply stop paying the fees and let the developer foreclose. Although the damage to their credit scores may be significant, the effect typically wanes over time and disappears once the collection drops off their credit reports in seven years.