In this conversation, Alex Murguia and Wade Pfau explore strategies for retirement planning, including hedging against inflation, using break-even analysis in Social Security decisions, and evaluating annuities for retirement income. They also cover the implications of Roth conversions and the reverse equity glide path strategy for managing investments. The discussion highlights the importance of understanding how different financial tools contribute to a comprehensive retirement plan.
Takeaways
- Hedging against inflation can be approached through TIPS or equities, each with distinct risk profiles.
- TIPS provide a contractually protected hedge against inflation, while equities may offer higher long-term growth.
- Break-even analysis for social security is often misleading and can lead to poor decision-making.
- Delaying social security benefits can provide inflation-adjusted lifetime income, which is crucial for retirees.
- Annuities can be a useful tool for ensuring reliable income, but their lack of inflation protection must be considered.
- Paying taxes for Roth conversions from an IRA is acceptable if no other funds are available.
- The present value of social security benefits should be considered as part of a retiree's bond-like income.
- The reverse equity glide path strategy can help manage sequence risk in retirement by gradually increasing equity exposure.
- Understanding the implications of social security estimates is essential for accurate retirement planning.
- Investment strategies should align with individual risk tolerance and retirement income needs.
Chapters
00:00 Market Valuations and Investment Strategies
00:00 Inflation Hedging: TIPS vs. Equities
04:23 The Break-Even Analysis of Social Security
09:54 Annuities and Inflation Protection
14:01 Roth Conversions and Tax Strategies
20:01 Social Security Strategies for Couples
26:58 Retirement Income Challenges and 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
Popular Podcasts
On Purpose with Jay Shetty
I’m Jay Shetty host of On Purpose the worlds #1 Mental Health podcast and I’m so grateful you found us. I started this podcast 5 years ago to invite you into conversations and workshops that are designed to help make you happier, healthier and more healed. I believe that when you (yes you) feel seen, heard and understood you’re able to deal with relationship struggles, work challenges and life’s ups and downs with more ease and grace. I interview experts, celebrities, thought leaders and athletes so that we can grow our mindset, build better habits and uncover a side of them we’ve never seen before. New episodes every Monday and Friday. Your support means the world to me and I don’t take it for granted — click the follow button and leave a review to help us spread the love with On Purpose. I can’t wait for you to listen to your first or 500th episode!
Stuff You Should Know
If you've ever wanted to know about champagne, satanism, the Stonewall Uprising, chaos theory, LSD, El Nino, true crime and Rosa Parks, then look no further. Josh and Chuck have you covered.
The Joe Rogan Experience
The official podcast of comedian Joe Rogan.