Retire With Style

In this episode of Retire with Style, Wade Pfau and Alex Murguia break down key concepts in retirement income planning, including present value, discount rates, and internal rates of return. They explain how these tools apply to real-world decisions such as Social Security claiming and choosing between a pension and a lump sum. The conversation highlights the importance of understanding cash flows and using sound mathematical analysis to inform decisions, while still accounting for personal preferences and risk. Listen now to learn more!   Takeaways Present value and breakeven analysis are crucial for financial planning. Understanding discount rates helps evaluate future cash flows. Internal rate of return is essential for comparing investment options. Financial decisions often boil down to present value calculations. Social security optimization relies on present value analysis. Pension versus lump sum decisions require careful discount rate consideration. Cash flow evaluation is key in retirement planning. Investment decisions should factor in opportunity costs. The relationship between interest rates and present value is significant. Financial planning is both a mathematical and an artful process. Chapters 00:00 Introduction to Retirement Income Planning 03:49 Understanding Present Value and Discount Rates 06:40 Evaluating Cash Flows and Internal Rate of Return 09:32 Applications in Financial Planning 12:46 The Impact of Interest Rates on Valuation 15:30 Real-Life Financial Decisions and Break-Even Analysis 18:53 Social Security and Pension Decisions 22:05 The Funded Ratio Tool and Its Importance Links Explore the New RetireWithStyle.com! We’ve launched a brand-new home for the podcast! Visit RetireWithStyle.com to catch up on all our latest episodes, explore topics by category, and send us your questions or ideas for future episodes. If there’s something you’ve been wondering about retirement, we want to hear it! This episode is sponsored by McLean Asset Management. Visit https://www.mcleanam.com/retirement-income-planning-llm/ to download McLean’s free eBook, “Retirement Income Planning”

Discover the upcoming tax changes set for 2026, including a return to standard ACA subsidies and higher estate tax exemptions. Learn how adjusted standard deductions will influence itemization and delve into inflation-related tax adjustments. Explore the implications of the alternative minimum tax for high-income earners. Plus, get the scoop on new Trump accounts for minors debuting in July 2026, and enjoy some light banter about New Year’s resolutions, making it both informative and entertaining!

As we close out 2025 and head into the New Year, we’re sharing one final Best of episode before returning with new conversations in January. This week’s replay is Alex’s top pick from the year, a conversation that stood out for its relevance, insight, and the questions it generated from listeners. We’ll be back soon with brand new episodes in 2026. Until then, Happy New Year, and thank you for being part of the Retire With Style community!   Repost from Episode 174 In this episode of Retire with Style, Wade Pfau and Alex Murguia sit down with Dr. Daniel Crosby, a leading voice in behavioral finance, to unpack the psychological side of investing in today’s volatile markets. Together, they examine how market swings and media noise shape investor behavior—and why having a thoughtful media diet and disciplined decision-making framework is more important than ever. This conversation lays the foundation for next week’s episode, where the discussion will shift toward deeper questions of wealth and meaning. Listen now to learn more! Takeaways Market volatility can trigger anxiety—even among professionals. It’s normal to feel fear during downturns, but those emotions don’t have to drive your decisions. Limiting exposure to financial news may help you stay focused and make better choices. Recognizing the incentives behind financial media can help you consume it more critically. More information isn’t always better—clarity often comes from less, not more. Patience matters. Reminding yourself that “this too shall pass” can be grounding. Uncertainty often causes more stress than bad news itself. Taking time to reflect before acting can lead to better financial outcomes. We tend to give others better advice than we give ourselves—pause and consider what you’d tell a friend. Automation and structured plans are powerful tools to reduce emotional decision-making. Chapters 00:00 Introduction to Behavioral Finance and Market Volatility 02:56 Understanding Market Reactions and Investor Psychology 06:01 The Impact of Media on Financial Decision Making 08:47 Navigating Uncertainty in Financial Markets 12:05 The Importance of Patience and Discipline in Investing 15:03 Frameworks for Better Financial Decision Making 17:55 Conclusion and Transition to The Soul of Wealth Links Click here to watch this episode on YouTube: https://youtu.be/6pMFE_-u0YM Explore the New RetireWithStyle.com! We’ve launched a brand-new home for the podcast! Visit RetireWithStyle.com to catch up on all our latest episodes, explore topics by category, and send us your questions or ideas for future episodes. If there’s something you’ve been wondering about retirement, we want to hear it! The Retirement Planning Guidebook: 2nd Edition has just been updated for 2025! Visit your preferred book retailer or simply click here to order your copy today: https://www.wadepfau.com/books/ This episode is sponsored by McLean Asset Management. Visit https://www.mcleanam.com/retirement-income-planning-llm/ to download McLean’s free eBook, “Retirement Income Planning”

As the year comes to a close, we’re taking a moment to revisit a few of our favorite Retire With Style episodes from 2025. This week, we’re replaying one episode that stood out in particular as Wade’s favorite conversation of the year, based on both the discussion and the questions it sparked from listeners. We’ll be back with brand new episodes after the holiday break. Thanks for listening this year, and we look forward to continuing the conversation in 2026. Repost from Episode 195 In this episode of Retire with Style, Wade Pfau and Alex Murguia talk with William Bengen, pioneer of the 4% rule in retirement planning. They explore the rule’s evolution, how inflation and market valuations shape sustainable withdrawals, and Bengen’s current recommendations. The discussion highlights the role of asset allocation, the importance of withdrawal strategies, and why ongoing monitoring is essential for a secure retirement. Takeaways William Bengen modernized retirement income planning with the 4% rule. Inflation is a critical factor in determining sustainable withdrawal rates. Market volatility can significantly impact retirement portfolios. A comprehensive withdrawal plan should consider multiple factors. Current recommendations suggest a withdrawal rate of around 5.5%. Asset allocation plays a vital role in retirement planning. Investors should consider a rising equity glide path strategy. Regular monitoring and adjustments to retirement plans are essential. High inflation can permanently elevate withdrawal amounts. The 4% rule is not a one-size-fits-all solution. Chapters 00:00 Introduction to Retirement Income Planning 01:14 The Birth of the 4% Rule 03:03 Understanding Withdrawal Rates 09:15 The Impact of Inflation on Withdrawals 12:45 Market Valuation and Its Effects 18:07 Current Withdrawal Rate Recommendations 21:10 Asset Allocation Strategies 24:04 Free Lunches in Investment Strategies 27:34 Key Takeaways from A Richer Retirement 31:15 Future Research Directions Links Get Bill Bengen’s New Book – A Richer Retirement Want to dive deeper into the research behind the 4% rule and how retirement income planning has evolved? Bill Bengen’s new book, A Richer Retirement, is now available—visit bengenfs.com to learn more and get your copy. Explore the New RetireWithStyle.com! We’ve launched a brand-new home for the podcast! Visit RetireWithStyle.com to catch up on all our latest episodes, explore topics by category, and send us your questions or ideas for future episodes. If there’s something you’ve been wondering about retirement, we want to hear it! The Retirement Planning Guidebook: 2nd Edition has just been updated for 2025! Visit your preferred book retailer or simply click here to order your copy today: https://www.wadepfau.com/books/ This episode is sponsored by McLean Asset Management. Visit https://www.mcleanam.com/retirement-income-planning-llm/ to download McLean’s free eBook, “Retirement Income Planning”

In this episode of Retire with Style, Wade Pfau and Alex Murguia explore how Treasury Inflation Protected Securities, or TIPS, fit into a retirement income plan. They discuss when it may make sense to build a TIPS ladder, the challenge of predicting interest rates, and how TIPS compare with equities as tools for managing inflation risk. The conversation also addresses strategies for creating inflation-adjusted income, the role TIPS can play alongside Social Security, and how a TIPS ladder can support a Social Security delay bridge. Listen now to learn more.    Takeaways TIPS are designed to protect against inflation in retirement. Timing is crucial when building a TIPS ladder for retirement income. Interest rates are unpredictable, making TIPS a safer choice now. Equities can provide growth but lack the guaranteed inflation protection of TIPS. Delaying Social Security can enhance retirement income security. Bond funds may not be the best option for retirement income planning. TIPS can help mitigate sequence of returns risk in retirement portfolios. A blend of TIPS and equities can optimize retirement income strategies. Interest rate risk is a significant factor when considering long-term bonds. Effective financial planning involves understanding the role of TIPS in a diversified portfolio. Chapters 00:00 Introduction to TIPS and Retirement Planning 02:44 Building a TIPS Ladder: Timing and Strategy 06:06 Understanding Interest Rates and TIPS 08:53 TIPS vs. Equities: Inflation Protection and Growth 11:46 Creating Inflation-Adjusted Income Streams 15:05 The Role of TIPS in Retirement Income 17:55 Bond Funds vs. TIPS: A Comparative Analysis 21:13 Social Security Delay Bridge and TIPS 24:00 Current TIPS Market and Yield Considerations 27:00 Final Thoughts and Holiday Wishes   Links Explore the New RetireWithStyle.com! We’ve launched a brand-new home for the podcast! Visit RetireWithStyle.com to catch up on all our latest episodes, explore topics by category, and send us your questions or ideas for future episodes. If there’s something you’ve been wondering about retirement, we want to hear it! The Retirement Planning Guidebook: 2nd Edition has just been updated for 2025! Visit your preferred book retailer or simply click here to order your copy today: https://www.wadepfau.com/books/ This episode is sponsored by McLean Asset Management. Visit https://www.mcleanam.com/retirement-income-planning-llm/ to download McLean’s free eBook, “Retirement Income Planning”

In this episode of Retire With Style, Alex Murguia and Wade Pfau explore core themes in retirement planning, including the 4 percent rule, sequence of returns risk, and how to balance discretionary and essential spending. They discuss how these factors shape retirement income strategies, the role of reliable income sources, and when a rising equity glide path can be beneficial. The conversation highlights why retirees may need a more flexible and adaptive approach rather than relying on traditional rules of thumb.   Takeaways The 4% rule is not a constant and can vary based on market conditions. Sequence of return risk is a real concern but may be overstated for average investors. Discretionary spending in retirement should be carefully planned to avoid future regrets. Variable spending strategies can help manage sequence risk effectively. Reliable income sources are crucial for covering essential expenses in retirement. Investors should consider the implications of longevity risk on their withdrawal strategies. The rising equity glide path can be a useful strategy for managing investment risk in retirement. Dividend income should not be the sole focus for retirement income planning. The retirement planning community often relies on outdated paradigms that may not serve current needs. Education on retirement income strategies should start early, even in high school. Chapters 00:00 Introduction to Retirement Planning Themes 06:11 Understanding the 4% Rule and Withdrawal Strategies 12:03 Exploring Sequence of Return Risk 17:59 Discretionary vs. Essential Spending in Retirement 24:13 The Role of Dividend Income in Retirement 30:06 Rising Equity Glide Path Strategies 36:04 The Shift from Traditional Drawdown Paradigms   Links    Explore the New RetireWithStyle.com! We’ve launched a brand-new home for the podcast! Visit RetireWithStyle.com to catch up on all our latest episodes, explore topics by category, and send us your questions or ideas for future episodes. If there’s something you’ve been wondering about retirement, we want to hear it! The Retirement Planning Guidebook: 2nd Edition has just been updated for 2025! Visit your preferred book retailer or simply click here to order your copy today: https://www.wadepfau.com/books/ This episode is sponsored by Retirement Researcher https://retirementresearcher.com/. Download their free eBook, 8 Tips to Becoming A Retirement Income Investor at retirementresearcher.com/8tips

In this episode of Retire With Style, Alex and Wade answer listener questions on key retirement planning topics. They discuss penalty-free withdrawals from 401(k)s, the role of Roth conversions for both younger savers and retirees, and the distinctions between qualified and non-qualified accounts. They also examine how long-term demographic trends may influence market expectations and investment strategies in the decades ahead.   Takeaways The rule of 55 allows penalty-free withdrawals from 401(k) plans if employment is terminated after age 55. Roth conversions should be considered based on current and future tax rates. It's important to fill your standard deduction to minimize tax liabilities. The after-tax safe withdrawal rate differs between account types due to ongoing taxes. Demographic trends are known and factored into market pricing over time. Diversification across asset classes remains a key strategy for long-term investment success. Understanding the implications of RMDs is crucial for tax planning in retirement. Financial planning software can help manage taxes and withdrawals effectively. Chapters 00:00 Introduction and Overview 03:01 Understanding the Rule of 55 10:56 Roth Conversions: Strategies and Timing 21:34 Tax Implications of Withdrawals 25:26 Demographic Trends and Market Predictions   Links Explore the New RetireWithStyle.com! We’ve launched a brand-new home for the podcast! Visit RetireWithStyle.com to catch up on all our latest episodes, explore topics by category, and send us your questions or ideas for future episodes. If there’s something you’ve been wondering about retirement, we want to hear it! The Retirement Planning Guidebook: 2nd Edition has just been updated for 2025! Visit your preferred book retailer or simply click here to order your copy today: https://www.wadepfau.com/books/ This episode is sponsored by McLean Asset Management. Visit https://www.mcleanam.com/retirement-income-planning-llm/ to download McLean’s free eBook, “Retirement Income Planning”

Beth Pinsker, a financial journalist and author of My Mother's Money, shares insights into the often-overlooked world of estate planning and financial caregiving. She reveals that only 30% of people have any estate documents in place, leading to common disputes over inheritance. Beth explains the importance of trusts versus wills in managing assets and preventing probate issues. She also emphasizes the need for clear beneficiary designations and open family communication to ease the emotional burden of settling affairs.

In this episode of Retire With Style, Wade and Alex talk with Beth Pinsker, author of My Mother’s Money, about the realities of financial caregiving. Beth shares her experience managing her mother’s finances during a health crisis, underscoring the value of preparation and clear legal documentation. The discussion covers the importance of establishing power of attorney, the practical challenges of budgeting for someone else, and the emotional strain that arises when court involvement becomes necessary. The episode offers listeners a straightforward look at why financial caregiving matters and what steps can help families prepare before a crisis hits.   Takeaways Preparation is crucial; having legal documents in place can save time and money later. Power of attorney is essential for anyone over 18 to ensure decisions can be made on their behalf. Financial institutions have varying requirements for accepting power of attorney documents. Navigating a loved one's finances can be complicated without access to their accounts. Budgeting for someone else requires understanding their entire financial picture, including bills and accounts. The court experience for those without power of attorney can be lengthy and emotionally taxing. Many people underestimate the importance of estate planning, regardless of their financial status. It's important to normalize discussions about power of attorney and healthcare proxies among families. Planning ahead can prevent significant stress and financial burden during a crisis. Chapters 00:00 Introduction to Financial Caregiving 01:45 The Journey Begins: Beth's Personal Experience 04:11 Preparing for the Inevitable: Legal and Financial Steps 10:21 The Importance of Power of Attorney 16:20 Navigating Financial Institutions 25:32 Reverse Engineering the Budget 30:34 The Court Experience and Its Implications   Links Find links to order Beth Pinkser's book, "My Mother's Money," at www.bethpinsker.com Explore the New RetireWithStyle.com! We’ve launched a brand-new home for the podcast! Visit RetireWithStyle.com to catch up on all our latest episodes, explore topics by category, and send us your questions or ideas for future episodes. If there’s something you’ve been wondering about retirement, we want to hear it! The Retirement Planning Guidebook: 2nd Edition has just been updated for 2025! Visit your preferred book retailer or simply click here to order your copy today: https://www.wadepfau.com/books/ This episode is sponsored by McLean Asset Management. Visit https://www.mcleanam.com/retirement-income-planning-llm/ to download McLean’s free eBook, “Retirement Income Planning”

In this episode, Alex and Wade unpack the complexities of Social Security claiming strategies, weighing the benefits of delaying versus claiming early. They examine key financial considerations such as survivor benefits, tax planning opportunities, and the psychological factors that shape these decisions. The discussion also highlights how the Retirement Income Style Awareness (RISA) tool can help align Social Security choices with individual retirement preferences. Ultimately, the episode underscores the long-term financial impact of claiming decisions.   Takeaways Delaying Social Security can significantly increase lifetime benefits. Social Security provides inflation-protected lifetime income. Survivor benefits are a crucial consideration for couples. Building a social security delay bridge can ease financial pressure. Claiming early may be necessary for those without sufficient resources. Psychological factors play a role in claiming decisions. Discount rates can influence the perceived value of Social Security benefits. RISA helps align retirement income strategies with personal preferences. Claiming early can be rational under certain circumstances. Social Security reforms are likely but won't eliminate the program. Chapters 00:00 Introduction and Context 00:56 The Case for Delaying Social Security 12:07 Understanding RISA and Claiming Early 16:06 Psychological Factors in Claiming Decisions 24:38 Understanding Technical Liquidity and Early Claiming 26:18 Medical Considerations for Early Claiming 28:50 Real-Life Implications of Claiming Strategies 31:11 Legitimate Reasons for Claiming Early 34:22 The Role of Discount Rates in Claiming Decisions 39:20 Dependent Benefits and Claiming Early 42:04 Concerns About Social Security's Future 45:08 Final Thoughts on Claiming Strategies   Links  Explore the New RetireWithStyle.com! We’ve launched a brand-new home for the podcast! Visit RetireWithStyle.com to catch up on all our latest episodes, explore topics by category, and send us your questions or ideas for future episodes. If there’s something you’ve been wondering about retirement, we want to hear it! The Retirement Planning Guidebook: 2nd Edition has just been updated for 2025! Visit your preferred book retailer or simply click here to order your copy today: https://www.wadepfau.com/books/ This episode is sponsored by Retirement Researcher https://retirementresearcher.com/. Download their free eBook, 8 Tips to Becoming A Retirement Income Investor at retirementresearcher.com/8tips