Rapid Fire Financial Shailos

Q: My son wants to take out a personal loan and asked me to cosign and guarantee it. The challenge is that I am 68 and have a relatively modest nest egg. Is it wrong for me to tell my son I am not doing this, or should I help him out?

A: It is not wrong. You should tell him to bug off. This loan could put you in a very precarious situation at your age and with your level of wealth. If your son defaults on the loan, which seems like a real possibility, you will be responsible and could face financial strain that you may not be able to overcome. You may then need to rely on your kids or charity to help if you do not have enough funds in retirement. Perhaps someone else can be a co-signer or tell your son not to take out a loan and to live within his means. Alternatively, tell him to ask his shvare for money. If he does not have a shvare, then maybe he should marry a girl with a rich father.

Q: My wife and I are committed Republicans. Our son and his wife have pretty much cut us out of their lives because they say we have nothing in common with them since they are Democrats. Should we cut him out of our will since he has not spoken to us in years?

A: I am not in favor of using a will to send a hurtful message. However, your son has actively pushed you and your wife out of his life, and his actions may understandably have consequences. Even so, I would think carefully before completely disinheriting him.

A better approach may be to keep him in the will while directing part of his inheritance to charity. You could choose an organization that promotes dialogue and understanding. If you want to make a point, you could direct a portion to Republican causes and explain that you did so because he chose to distance himself from you. It may irritate him, but it is far less damaging than cutting him out entirely.

More importantly, do not let your estate plan become your final conversation with your son. Try to make amends while you still can. That may mean you need to make the first move. If you reconcile, leave politics out of it. You do not need to agree on politics to love your child.

The country will survive without political debates at your Yom Tov table. Your relationship with your son may not.

Q: What are your thoughts on the Fed raising rates and what should investors do in response to this?

A: My thoughts stated succinctly are that raising rates is part of any normal market and economic cycle, and most investors should do nothing in response to the Fed’s move. Financial news outlets love obsessing over rates because it drives engagement. They would get far less attention if they simply stated the truth.

However, let me take a step back and add some needed context. The Fed raised interest rates by a quarter of a percentage point because inflation is still proving difficult to control. Prices continue to rise, and geopolitical tensions are adding pressure. Higher rates help address these challenges. At the same time, the economy remains strong, with the Fed expecting continued growth and lower unemployment, partly due to the boom in artificial intelligence. The main message is that the Fed is committed to fighting inflation.

For retail investors with properly structured portfolios, the best move is to stay put. Your allocation should not change materially based on rates. More conservative investors, or those holding cash for a near‑term purchase, will benefit because they can now earn higher interest with little or no risk. For long‑term investors, keep holding equities as planned. Stocks may be volatile during this part of the cycle, which is normal, but over the long run a diversified stock portfolio will likely outperform hiding in bonds.

Q: Someone told me that if you speak at a Pesach program you can write off the cost of the entire program as a business expense. Is this true?

A: I am not a CPA and do not play one on TV (although that would make great television). Based on my limited knowledge of the tax code, I believe the IRS would not allow someone to write off an entire vacation simply because they give a few lectures during the trip. Deductibility depends on the primary purpose of the travel, and most Pesach programs or resort stays are considered personal unless the schedule is overwhelmingly business driven, which it is not since you will presumably be celebrating Yom Tov much of the time.

Only the business portion of a mixed trip can be deducted, such as travel directly tied to speaking engagements. That may include your flight, but not your entire family’s flights. You can also deduct lodging for business days and specific speaking‑related expenses. Personal vacation days, family costs, and program fees tied to leisure or holiday experiences are not deductible.

In an eight‑day Passover program with only a few lectures, the IRS would likely view the trip as primarily personal, making a full write‑off indefensible. A conservative approach is to allocate expenses by day, deduct only the business‑related portion, and maintain clear documentation such as contracts, schedules, and proof of professional activity. While some costs may qualify, attempting to deduct the entire trip would raise significant audit risk. That is a risk you need to decide if you want to take.

A two‑year vacation in Otisville may be worth the risk to some. It does not seem worth it to me.

Q: Social Security is projected to run deficits for the rest of the century. How would you propose fixing the system?

A: This shayla comes up often. It is just not usually posed to me, but I’m happy to offer some thoughts.

Social Security’s math problem is well known. What is missing is political will, not ideas. There are four basic levers available:

1. Lift or eliminate the taxable wage cap. This is probably the least painful politically because it mainly impacts earnings above roughly $176,000. It could close a meaningful portion of the shortfall, although not the entire problem.

2. Raise the retirement age. This makes actuarial sense given longer life expectancies, but it would hit lower‑income workers and people in physically demanding jobs the hardest. Any increase would need to be phased in with protections for vulnerable workers.

3. Slow benefit growth. Changing the inflation formula or means‑testing benefits for higher earners would reduce future outlays. These ideas are politically difficult because they are viewed as benefit cuts.

4. Raise payroll taxes. This is straightforward mechanically, but tax increases face predictable resistance.

Most credible bipartisan proposals combine several of these approaches and spread the burden among workers and beneficiaries. The political challenge is that any solution requires someone to accept less than they were promised. The projected trust fund depletion around 2033 or 2034, followed by automatic benefit reductions, may eventually make inaction more costly than action. Until then, Washington has little incentive to move.

The truth is that Social Security will always exist because it is a popular program and neither party wants to risk its political reputation by eliminating it. The problem is that a long-term fix requires sacrifices that are not politically popular, which is why a permanent solution may never materialize.

My suggestion to families who are concerned about Social Security is to focus on what is in your control. Namely, a high savings rate, investing properly, and living well within your means. Regardless of what happens with Social Security, you will be prepared for retirement.