July 9, 2026 • 14 mins
Most people can name the “retirement age” in a second. But the number that quietly unlocks real flexibility for your 401(k), 403(b), and traditional IRA is 59.5 and missing it can keep you working years longer than you need to. We walk through why that milestone matters, what changes when the 10% early withdrawal penalty goes away, and how access to your retirement accounts can reshape the way you think about retirement timing.
We also challenge the habit of chasing a moving “retirement number.” Markets rise, inflation hits, headlines scare us, and the goalposts shift from $1 million to $2 million to “just one more year.” That mindset feels responsible, but it can ignore a risk you can’t diversify away: Time. We talk about why retirement planning should account for health, energy, and the seasons of spending that show up across retirement, not just a single safe withdrawal rule.
Then we get practical: why the 4% rule is a helpful guideline but not a life sentence, how Social Security timing can reduce how much your portfolio needs to produce, and what a realistic plan can look like for a couple who thinks they’re years away but may be much closer. We also hit the big worries that stop people from retiring earlier, like healthcare before Medicare at 65, mortgages, and family support and how running the numbers often turns “impossible” into “manageable.”
If this helps you rethink your timeline, subscribe, share it with someone who needs it, and leave a review so more people can find smarter retirement income planning. What age do you want your money to start buying your time back?
🗓️ Meet with me: https://paradigmwealthpartners.com/begin-your-journey/#calendly
↔️ Connect with me on LinkedIn: https://www.linkedin.com/in/jbednarii/
🌐 Paradigm Wealth Partners (website) – Financial planning for career professionals who want to retire and stay retired: https://paradigmwealthpartners.com/
🌐 What the Wealth (website) – Adding clarity to difficult financial topics: https://whatthewealth.com/
▶️ YouTube: Paradigm Wealth Partners
If you or someone you care about could use the help of a financial advisor and sees the value in establishing a financial plan, please reach out to me.
Thanks for Listening!
Jonathan
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
SPEAKER_00 (00:04):
If I asked you what's a common age that most
people retire, what's the firstnumber that comes to your mind?
65, maybe 67?
For most people, it's somewherein their mid-60s.
And that makes sense.
For decades, we've beenconditioned to think that
retirement starts at 65.
You work your career, youcollect Social Security, and
(00:26):
then hopefully you enjoy yourretirement.
What if I told you there'sanother age that might be even
more important?
An age that many peoplecompletely overlook.
An age that causes some peopleto realize that they may be much
closer to retirement than theyever imagined.
That age is 59 and a half.
At Paradigm Wealth Partners,we've helped hundreds of
(00:46):
families transition intoretirement.
And one thing I've noticed isthat many people are working
longer than they actually needto.
Not because they don't haveenough money, but because
they're following outdatedretirement rules.
And that may be costing themsome of the best years of their
lives.
Once they understand thisconcept, many start looking at
(01:07):
retirement very differently.
So let's talk about why.
The reason 59.5 is so importantis actually pretty simple.
Before age 59 and a half,withdrawals from most retirement
accounts like traditional IRAs,401ks, 403Bs, trigger a 10%
early withdrawal penalty on topof your ordinary income tax
(01:31):
liability.
That's a pretty expensivemistake or pretty expensive
withdrawal.
Once you reach age 59.5, thatpenalty disappears.
Now you still pay taxes on thetraditional retirement account
withdrawals, but the extra 10%penalty for pre uh pre-59.5
withdrawal is gone.
It disappears.
(01:52):
That changes everything forretirees.
Suddenly, the money that you'vespent decades saving becomes
accessible.
Your retirement accounts stopbeing something that you're
waiting to use someday, and theyare actually available now.
They're available today.
That tool can be helpful whenthey're thinking about their
(02:15):
retirement.
Now, does this mean thateveryone should retire at 59 and
a half?
No.
But does it mean many peoplehave more options than they
realize?
Yes.
And that's where things start toget interesting.
See, many people believeretirement's about reaching a
magic number.
Maybe it's a million, or maybeit's two million, or three
million.
(02:35):
The problem is the number isn'tthe number itself.
The number always actually seemsto move.
You hit your goal, then you wanta little more, or the market
continues to go up, inflationrises, or maybe there's some
scary headlines, and suddenlyyou're working another year, and
then another, and then another.
(02:56):
And I've seen people do this foryears, and not because they're
irresponsible, not becausethey're greedy, it's because
they're trying to eliminateevery possible risk.
While they're focused onpreserving their money and
having that money last to andthrough their retirement, they
often ignore another riskentirely, and that is time.
(03:17):
Let me ask you another question.
How many truly healthy andactive years do you think you
have left?
I don't mean that in a morbidway, but most of us understand
we're not going to live forever.
We underestimate is that we'renot going to stay healthy
forever either.
One of the things that hascaught my attention recently was
(03:39):
research from Stanford showingthat people experience two
significant aging uh changes.
One of those is in your 40s andthen again in your early 60s.
Now, hopefully all of us stayhealthy and active for decades,
and I certainly hope that'strue.
But remember, planning isn'tjust about how long your money
(04:01):
lasts, it's also making sure youstill have the health, the
energy, and the freedom to enjoythe life you've worked so hard
to build.
So if you're 55 today and you'refeeling great, it's easy to
assume you'll feel exactly thesame at 65.
Sometimes that's true, sometimesit isn't.
And that's why timing matters.
(04:22):
In fact, I say that time is yourbiggest asset.
So let's talk about something uhthat may be a little bit more
controversial, and that's the 4%rule.
The 4% rule has come under somecontroversy over the last couple
of years.
It's a great rule of thumb.
Most retirees have heard of the4% rule.
(04:43):
The idea is simple.
Let's say you needed$90,000 peryear to multiply that$90,000 by
$5,000, and that would give youroughly, well, not roughly, it
would give you$2,250,000 thatyou would need to save for
(05:03):
retirement.
That$2,250,000 at 4% wouldgenerate the$90,000 per year you
may need in retirement.
And while I think the 4% rulecan be useful, a guideline and a
great rule of thumb, many peopletreat it as if it's the only way
retirement can work.
(05:24):
You see, retirees are notrobots.
People adjust, people adapt,people spend differently in
different seasons of life.
And in many cases, spending isactually the highest during
their early years of retirementwhen people are traveling and
pursuing hobbies and checkingthings off of their bucket list.
(05:44):
Then your spending tends tolevel off and then increases
again later in life when healthcare costs rise.
You may need uh, you know,memory care or nursing care or
something like that, and itcauses your spending to increase
again.
You see, real life is dynamic,and retirement planning should
(06:06):
be too.
And that's why I think it'sdangerous when people become so
focused on one rule that theyignore the bigger picture.
I've seen people work yearslonger than necessary chasing an
arbitrary number that may notactually be required to hit or
reach any of their goals.
Let's talk about a hypotheticalcouple.
(06:28):
I'll call them Tom and Janet.
They're both 60 years old, theyhave$1.7 million save, a
paid-off house, no major debt,and they want to spend about
$90,000 per year.
So most financial media wouldtell them keep working, build a
bigger nest egg, you need to getto$2 million, you need to get to
(06:51):
$2.25 million, you need more.
And so they assume they're notready, but they've never
actually run the numbers.
So when we do that, when weactually run the numbers on
their situation, on their life,they could potentially retire
sooner.
At age 67, Social Security couldprovide roughly$50,000 to$60,000
(07:14):
per year for their retirementincome, their retirement
paycheck.
That means their portfoliodoesn't necessarily need to
generate$90,000 a year forever.
It only needs to bridge the gapuntil we turn Social Security
on, and then we can reduce theamount that we need to take from
retirement accounts.
So what they discoveredsurprised them.
(07:35):
They weren't five years or sevenyears away from retirement.
They were much closer than theythought.
In fact, retirement becamepossible significantly sooner
than they had imagined.
And the issue wasn't money, itwas clarity.
They had created a clarity and aframework for their retirement,
(07:57):
their income, and how they weregoing to use their nest egg for
a paycheck.
That gave them the confidence tomove into retirement sooner than
they thought they were going to.
So let's talk about now the realcost of waiting.
This is the part that reallygets me fired up.
A lot of times you hear peopletalking about Social Security,
and you hear them talking aboutif you delay Social Security
(08:21):
another year, your SocialSecurity will get an 8% bump
between 62 and 70.
Now at 70, it caps out, butevery year you wait, you get an
additional 8% more by just bywaiting a year.
Some people may need that tohelp make all the numbers work.
But what I've actually seen isevery extra year you delay
(08:43):
retirement for a little moresecurity is a year you'll never
get back.
And I've seen this happen manytimes.
Someone finally retires, they'reexcited, they're making big
travel plans, and they're movingtowards this next chapter.
But then life happens.
They get a health diagnosis,they have mobility issues, a
spouse develops, you know, maybecancer or chronic illness or
(09:08):
another health concern.
So it's it's not always the bestthing to do to wait.
Now, again, from a paycheck anda social security increase
number, uh, it looks great, butyou're giving up one year of
healthy life for that.
And so that trade-off needs tobe thought through as you make
this decision.
(09:29):
It happens often enough that weneed to acknowledge it.
So let's consider two people whoretire.
One retires at 59 and a half,one retires at 65.
That's five and a half years ofpotentially better health, more
energy, more mobility, morefreedom to do the things you
(09:52):
love.
That five and a half years ofexperiences that could never be
recreated later if you continueto delay your retirement.
I've never had someone tell me,Jonathan, I wish I had worked
five more years, but I've heardmany people say, I wish I had
retired sooner.
So the big question that a lotof people are gonna ask is, what
(10:15):
about healthcare?
Now, I know some of you areconcerned about this.
It's something to be thinking ofas you move into retirement.
How are you gonna bridge the gapif you retire early until you
can get on Medicare at age 65?
What about health insurance?
What about my mortgage?
What if my kids need help?
These are all legitimateconcerns and they deserve real
(10:38):
planning.
Healthcare is one of the biggestconcerns people have uh retiring
before Medicare starts at 65.
Once we actually run thenumbers, many clients actually
discover that it's moremanageable than they expected.
The same thing happens withmortgages.
Many people have built asubstantial equity over 20 or 30
(10:59):
years, and many times theychoose to downsize later in
retirement.
They don't need a 3,800 squarefoot house when 1,700 or 1800
would be fine.
Or maybe they're going todownsize and they're going to
move across country to be closerto their family, and they don't
need as big a house.
So there's things that can beplanned for in your financial
(11:20):
plan to help kind of alleviatesome of these pain points that
you might be maybe putting morestress into than needed.
Every situation is different.
And what I've learned in manyretirement uh situations is
obstacles look much larger thanthey really are before they get
an analyzed.
(11:41):
So once we're able to look atthem, once you have a plan, they
often become more manageablethan you imagine.
So what I'm gonna do is give youthree things to do next.
If you're in your 50s, maybe 55or so, if you're within 10 years
of retirement, here are thethree things I would encourage
you to do.
(12:02):
First, don't wait untilretirement is staring you in the
face to start building aretirement plan.
Start building your retirementplan now.
Secondly, challenge yourassumptions.
Ask yourself whether retirementnumber you've been chasing is
based on actual needs or justconventional wisdom.
(12:23):
Is it just, you know, the extracomma or the extra digit makes
it look better?
And then third, work withsomeone who can help you
evaluate retirement using realplanning, not just rules of
thumb.
Retirement isn't just aboutaccumulating the biggest account
balance, it's about turning yourassets into income and using
(12:45):
that income to create the lifeyou love.
In closing, the goal isn't todie with the most money.
The goal is to live fully andenjoy life, the experiences,
your family, your friends whileyou still can.
And sometimes the biggestretirement mistakes isn't
retiring too early, it's waitingtoo long.
(13:08):
When people learn how retirementactually works, many people
realize they're closer than theyever thought.
And sometimes they stop working.
Please make sure to like andsubscribe.
If you'd like to see what aretirement plan actually looks
like, and more importantly,whether you're closer to
retirement than you think,schedule some time to talk with
(13:30):
me using the link and mycalendar link in the
description.
Until next time, be confident inyour retirement.
Have a wonderful day.
Thanks for joining me on anotherepisode of What the Wealth.
If you enjoyed the episodetoday, smash that subscribe
button.
It helps me more than you think.
Also, if you found this episodeinsightful and a light bulb went
off, share it.
(13:51):
Your friend Aunt Judy, therandom guy in the office who's
always talking aboutinvestments.
Wealth isn't about just a chipchain.
It's about our choices, chances,and changing our financial
futures.
The information in this podcastis informational and general in
nature and does not take intoconsideration the listener's
personal circumstances.
This podcast is not intended tobe a substitute for specific in
(14:13):
financial, legal, or tax advice.
You should consult the approvedqualified professional prior to
making a final decision.
Securities offered through LPLFinancial, member FINRA SIPC.
Paradigm Wealth Partners is theother business name for
Independent Advisor Alliance.
Investment Advice offeredthrough Independent Advisor
Alliance, a registeredinvestment advisor, Independent
Advisor Alliance, and ParadigmWealth Partners are separate
(14:35):
entities for LPL Financial.
If I asked you what's a common age that most
people retire, what's the firstnumber that comes to your mind?
65, maybe 67?
For most people, it's somewherein their mid-60s.
And that makes sense.
For decades, we've beenconditioned to think that
retirement starts at 65.
You work your career, youcollect Social Security, and
(00:26):
then hopefully you enjoy yourretirement.
What if I told you there'sanother age that might be even
more important?
An age that many peoplecompletely overlook.
An age that causes some peopleto realize that they may be much
closer to retirement than theyever imagined.
That age is 59 and a half.
At Paradigm Wealth Partners,we've helped hundreds of
(00:46):
families transition intoretirement.
And one thing I've noticed isthat many people are working
longer than they actually needto.
Not because they don't haveenough money, but because
they're following outdatedretirement rules.
And that may be costing themsome of the best years of their
lives.
Once they understand thisconcept, many start looking at
(01:07):
retirement very differently.
So let's talk about why.
The reason 59.5 is so importantis actually pretty simple.
Before age 59 and a half,withdrawals from most retirement
accounts like traditional IRAs,401ks, 403Bs, trigger a 10%
early withdrawal penalty on topof your ordinary income tax
(01:31):
liability.
That's a pretty expensivemistake or pretty expensive
withdrawal.
Once you reach age 59.5, thatpenalty disappears.
Now you still pay taxes on thetraditional retirement account
withdrawals, but the extra 10%penalty for pre uh pre-59.5
withdrawal is gone.
It disappears.
(01:52):
That changes everything forretirees.
Suddenly, the money that you'vespent decades saving becomes
accessible.
Your retirement accounts stopbeing something that you're
waiting to use someday, and theyare actually available now.
They're available today.
That tool can be helpful whenthey're thinking about their
(02:15):
retirement.
Now, does this mean thateveryone should retire at 59 and
a half?
No.
But does it mean many peoplehave more options than they
realize?
Yes.
And that's where things start toget interesting.
See, many people believeretirement's about reaching a
magic number.
Maybe it's a million, or maybeit's two million, or three
million.
(02:35):
The problem is the number isn'tthe number itself.
The number always actually seemsto move.
You hit your goal, then you wanta little more, or the market
continues to go up, inflationrises, or maybe there's some
scary headlines, and suddenlyyou're working another year, and
then another, and then another.
(02:56):
And I've seen people do this foryears, and not because they're
irresponsible, not becausethey're greedy, it's because
they're trying to eliminateevery possible risk.
While they're focused onpreserving their money and
having that money last to andthrough their retirement, they
often ignore another riskentirely, and that is time.
(03:17):
Let me ask you another question.
How many truly healthy andactive years do you think you
have left?
I don't mean that in a morbidway, but most of us understand
we're not going to live forever.
We underestimate is that we'renot going to stay healthy
forever either.
One of the things that hascaught my attention recently was
(03:39):
research from Stanford showingthat people experience two
significant aging uh changes.
One of those is in your 40s andthen again in your early 60s.
Now, hopefully all of us stayhealthy and active for decades,
and I certainly hope that'strue.
But remember, planning isn'tjust about how long your money
(04:01):
lasts, it's also making sure youstill have the health, the
energy, and the freedom to enjoythe life you've worked so hard
to build.
So if you're 55 today and you'refeeling great, it's easy to
assume you'll feel exactly thesame at 65.
Sometimes that's true, sometimesit isn't.
And that's why timing matters.
(04:22):
In fact, I say that time is yourbiggest asset.
So let's talk about something uhthat may be a little bit more
controversial, and that's the 4%rule.
The 4% rule has come under somecontroversy over the last couple
of years.
It's a great rule of thumb.
Most retirees have heard of the4% rule.
(04:43):
The idea is simple.
Let's say you needed$90,000 peryear to multiply that$90,000 by
$5,000, and that would give youroughly, well, not roughly, it
would give you$2,250,000 thatyou would need to save for
(05:03):
retirement.
That$2,250,000 at 4% wouldgenerate the$90,000 per year you
may need in retirement.
And while I think the 4% rulecan be useful, a guideline and a
great rule of thumb, many peopletreat it as if it's the only way
retirement can work.
(05:24):
You see, retirees are notrobots.
People adjust, people adapt,people spend differently in
different seasons of life.
And in many cases, spending isactually the highest during
their early years of retirementwhen people are traveling and
pursuing hobbies and checkingthings off of their bucket list.
(05:44):
Then your spending tends tolevel off and then increases
again later in life when healthcare costs rise.
You may need uh, you know,memory care or nursing care or
something like that, and itcauses your spending to increase
again.
You see, real life is dynamic,and retirement planning should
(06:06):
be too.
And that's why I think it'sdangerous when people become so
focused on one rule that theyignore the bigger picture.
I've seen people work yearslonger than necessary chasing an
arbitrary number that may notactually be required to hit or
reach any of their goals.
Let's talk about a hypotheticalcouple.
(06:28):
I'll call them Tom and Janet.
They're both 60 years old, theyhave$1.7 million save, a
paid-off house, no major debt,and they want to spend about
$90,000 per year.
So most financial media wouldtell them keep working, build a
bigger nest egg, you need to getto$2 million, you need to get to
(06:51):
$2.25 million, you need more.
And so they assume they're notready, but they've never
actually run the numbers.
So when we do that, when weactually run the numbers on
their situation, on their life,they could potentially retire
sooner.
At age 67, Social Security couldprovide roughly$50,000 to$60,000
(07:14):
per year for their retirementincome, their retirement
paycheck.
That means their portfoliodoesn't necessarily need to
generate$90,000 a year forever.
It only needs to bridge the gapuntil we turn Social Security
on, and then we can reduce theamount that we need to take from
retirement accounts.
So what they discoveredsurprised them.
(07:35):
They weren't five years or sevenyears away from retirement.
They were much closer than theythought.
In fact, retirement becamepossible significantly sooner
than they had imagined.
And the issue wasn't money, itwas clarity.
They had created a clarity and aframework for their retirement,
(07:57):
their income, and how they weregoing to use their nest egg for
a paycheck.
That gave them the confidence tomove into retirement sooner than
they thought they were going to.
So let's talk about now the realcost of waiting.
This is the part that reallygets me fired up.
A lot of times you hear peopletalking about Social Security,
and you hear them talking aboutif you delay Social Security
(08:21):
another year, your SocialSecurity will get an 8% bump
between 62 and 70.
Now at 70, it caps out, butevery year you wait, you get an
additional 8% more by just bywaiting a year.
Some people may need that tohelp make all the numbers work.
But what I've actually seen isevery extra year you delay
(08:43):
retirement for a little moresecurity is a year you'll never
get back.
And I've seen this happen manytimes.
Someone finally retires, they'reexcited, they're making big
travel plans, and they're movingtowards this next chapter.
But then life happens.
They get a health diagnosis,they have mobility issues, a
spouse develops, you know, maybecancer or chronic illness or
(09:08):
another health concern.
So it's it's not always the bestthing to do to wait.
Now, again, from a paycheck anda social security increase
number, uh, it looks great, butyou're giving up one year of
healthy life for that.
And so that trade-off needs tobe thought through as you make
this decision.
(09:29):
It happens often enough that weneed to acknowledge it.
So let's consider two people whoretire.
One retires at 59 and a half,one retires at 65.
That's five and a half years ofpotentially better health, more
energy, more mobility, morefreedom to do the things you
(09:52):
love.
That five and a half years ofexperiences that could never be
recreated later if you continueto delay your retirement.
I've never had someone tell me,Jonathan, I wish I had worked
five more years, but I've heardmany people say, I wish I had
retired sooner.
So the big question that a lotof people are gonna ask is, what
(10:15):
about healthcare?
Now, I know some of you areconcerned about this.
It's something to be thinking ofas you move into retirement.
How are you gonna bridge the gapif you retire early until you
can get on Medicare at age 65?
What about health insurance?
What about my mortgage?
What if my kids need help?
These are all legitimateconcerns and they deserve real
(10:38):
planning.
Healthcare is one of the biggestconcerns people have uh retiring
before Medicare starts at 65.
Once we actually run thenumbers, many clients actually
discover that it's moremanageable than they expected.
The same thing happens withmortgages.
Many people have built asubstantial equity over 20 or 30
(10:59):
years, and many times theychoose to downsize later in
retirement.
They don't need a 3,800 squarefoot house when 1,700 or 1800
would be fine.
Or maybe they're going todownsize and they're going to
move across country to be closerto their family, and they don't
need as big a house.
So there's things that can beplanned for in your financial
(11:20):
plan to help kind of alleviatesome of these pain points that
you might be maybe putting morestress into than needed.
Every situation is different.
And what I've learned in manyretirement uh situations is
obstacles look much larger thanthey really are before they get
an analyzed.
(11:41):
So once we're able to look atthem, once you have a plan, they
often become more manageablethan you imagine.
So what I'm gonna do is give youthree things to do next.
If you're in your 50s, maybe 55or so, if you're within 10 years
of retirement, here are thethree things I would encourage
you to do.
(12:02):
First, don't wait untilretirement is staring you in the
face to start building aretirement plan.
Start building your retirementplan now.
Secondly, challenge yourassumptions.
Ask yourself whether retirementnumber you've been chasing is
based on actual needs or justconventional wisdom.
(12:23):
Is it just, you know, the extracomma or the extra digit makes
it look better?
And then third, work withsomeone who can help you
evaluate retirement using realplanning, not just rules of
thumb.
Retirement isn't just aboutaccumulating the biggest account
balance, it's about turning yourassets into income and using
(12:45):
that income to create the lifeyou love.
In closing, the goal isn't todie with the most money.
The goal is to live fully andenjoy life, the experiences,
your family, your friends whileyou still can.
And sometimes the biggestretirement mistakes isn't
retiring too early, it's waitingtoo long.
(13:08):
When people learn how retirementactually works, many people
realize they're closer than theyever thought.
And sometimes they stop working.
Please make sure to like andsubscribe.
If you'd like to see what aretirement plan actually looks
like, and more importantly,whether you're closer to
retirement than you think,schedule some time to talk with
(13:30):
me using the link and mycalendar link in the
description.
Until next time, be confident inyour retirement.
Have a wonderful day.
Thanks for joining me on anotherepisode of What the Wealth.
If you enjoyed the episodetoday, smash that subscribe
button.
It helps me more than you think.
Also, if you found this episodeinsightful and a light bulb went
off, share it.
(13:51):
Your friend Aunt Judy, therandom guy in the office who's
always talking aboutinvestments.
Wealth isn't about just a chipchain.
It's about our choices, chances,and changing our financial
futures.
The information in this podcastis informational and general in
nature and does not take intoconsideration the listener's
personal circumstances.
This podcast is not intended tobe a substitute for specific in
(14:13):
financial, legal, or tax advice.
You should consult the approvedqualified professional prior to
making a final decision.
Securities offered through LPLFinancial, member FINRA SIPC.
Paradigm Wealth Partners is theother business name for
Independent Advisor Alliance.
Investment Advice offeredthrough Independent Advisor
Alliance, a registeredinvestment advisor, Independent
Advisor Alliance, and ParadigmWealth Partners are separate
(14:35):
entities for LPL Financial.
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