Amy, a 65-year-old Bay Area tech professional, called into Jill on Money with Jill Schlesinger for a retirement readiness check. Her words set the stage: “I thought I had a good plan a few years ago and then got laid off. It kind of threw me off for a couple years. I lost ground in terms of not being able to save money and kind of drawing on stuff. That’s the reason why I’m kind of skittish about things.”
On paper, Amy looks wealthy. She earns a $230,000 base with a $40,000 to $50,000 bonus, owns a $2.2 million San Francisco home with $320,000 owed at 3%, and a $1.2 million wine country second home. Retirement accounts total $915,000 across a $430,000 variable annuity, a $300,000 rollover IRA, a $185,000 Roth IRA, a $110,000 Roth 401(k), a $190,000 brokerage with concentrated stock positions, and $75,000 cash. Monthly spend runs about $9,000.
The Verdict: Yes, With Two Fixes
Schlesinger’s call is that Amy can retire, but only if she stops confusing net worth with cash flow. “I hate to tell you this, but so much of your wealth is in these two homes,” Schlesinger told her. Real estate does not pay grocery bills. Roughly $3.4 million of Amy’s balance sheet is illiquid, and the wine country home is not rented.
The math that gets Amy to retirement is simpler than the balance sheet suggests. Schlesinger walked it: “Let’s just do a round number. Let’s say you take out from that rollover account $100,000 a year and we just get rid of it, we deplete it, and you pay the tax that’s due. You’re pretty close to your $9,000 a month on your spend, because it’s like $100,000 with his $2,200 a month.”
That bridge holds until Social Security kicks in. Amy’s benefit is $41,000 per year at 67 or $51,000 at 70. Waiting until 70 stacks the income cleanly: “Once you’re at $5,100 a month plus your $2,200 a month, you’re in good shape. That’s like $7,300.” The 2026 Social Security COLA of 2.8% then does the annual heavy lifting on inflation.
Do Not Pay Off The 3% Mortgage
Amy’s instinct, common at 65, is to retire debt-free. Schlesinger’s answer was blunt: “No. Definitely not. Anything under 4%, absolutely not.”
The variable that decides this is the spread between her mortgage rate and safe yields. The 10-year Treasury is at 4.6%. Every dollar Amy uses to erase a 3% loan is a dollar she cannot park in a Treasury paying more. On a $320,000 balance, that spread is real money, and the mortgage interest is tax-deductible under the 2026 brackets set by the One Big Beautiful Bill. National-average CDs at 1.7% flip the math the other way, so Amy needs to own the higher-yield instrument for the logic to work.
The Annuity, The Concentrated Stock, And Plan B
Amy explained the annuity plainly: “I was freaked out a few years ago when I lost my job. I opened an annuity. I know that.” Schlesinger’s reaction was direct: “No one buys an annuity when you’re feeling great. There’s no way. It’s like, okay, yeah, no, okay.” The play is to wait: “You might want to look at that. You could literally use that and try to kind of annuitize that, get you through whatever else you need, or you can roll it over and use it to help get you to age 70.”
The $190,000 brokerage account is the other pressure point. Schlesinger’s guidance: “Take half of a position off. Just take half. Pay some capital gains and reallocate. Then you’re protected. You still have upside, but you’re protected against the downside.”
The wine country home is the safety valve. “If one of those goes, you’re 100% great. It’s a game changer, frankly,” Schlesinger said. With the Case-Shiller National Home Price Index at 332.7 in April 2026, a 12-month high, that plan B is currently worth something close to peak value.
What Amy Should Actually Do
- Draw $100,000 per year from the rollover IRA as the bridge to Social Security, and pay the tax rather than hoard it.
- Delay Social Security to 70 to lock in the $51,000 benefit, then let the COLA do its work.
- Trim the concentrated brokerage stock by half, accept the capital gains, and reinvest in a diversified allocation.
- Leave the 3% mortgage alone while safe yields sit above it.
- Revisit the variable annuity in early 2028, once surrender charges expire, and decide between annuitizing and rolling it over.
- Budget for Medicare: the 2026 standard Part B premium is $202.90 a month with a $283 annual deductible, and higher-income surcharges start above $218,000 for joint filers.
- Treat the wine country home as the written plan B, with a sale price and trigger already agreed on.
Amy’s closer, “I’ve been working since I was 15, so it feels unusual to maybe just kind of call it quits,” is the emotional part. The financial part is settled. As Schlesinger put it: “You’re right on the cusp. You’ve done everything right. Don’t trust the man: not the husband, I mean the man you work for: and plan accordingly. You got your plan B. I think you’re in good shape. I really do.” Cash flow is what tells you when you can retire.
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