Direct Indexing vs. Mutual Fund or ETFs

Retirement Answer Man

Roger Whitney, CFP®, CIMA®, RMA, CPWA®

Lifeplanning, Retirementplanning, Financialplanning, Saving, Careerplanning, Self-improvement, Education, Retirementpodcast, Investing, Business, Investmentmanagement, Retirement

4.7 • 1.1K Ratings

🗓️ 20 August 2025

⏱️ 46 minutes

🔗️ Recording | iTunes | RSS

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Summary

💬 Show Notes

In this episode, Roger explores how naming and recognizing the different phases of life can bring clarity to the retirement journey. A listener’s question about inherited money sparks a conversation about direct indexing—what it is, when it makes sense, and what to watch out for. He also shares how to navigate calm, choppy, and rough waters in retirement planning so listeners can move forward with more confidence and control.

OUTLINE OF THIS EPISODE OF THE RETIREMENT ANSWER MAN

(00:00) Today we will talk about direct indexing and answer some more of your questions.
(01:04) Roger talks about acknowledging and naming things in life.
(04:19) There are four levels that Roger wants to acknowledge with clients- calm waters, choppy waters, rough waters, and change of course.

ROCKIN RETIREMENT IN THE WILD

(08:55) Brian says he focuses on spending time with family in retirement.
(09:20) Don says electric bikes are game changers.

PRACTICAL PLANNING SEGMENT

(10:30) John asks a question about direct indexing.
(13:17) Direct indexing is when you buy the individual stocks of an index in your own account instead of a fund, allowing for tax benefits and customization but with more complexity.
(16:32) Should you do this if you are concerned about taxes? What are the benefits? The drawbacks?
(20:38) Roger says exchanging traded funds has some advantages over indexing.

LISTENER QUESTIONS

(21:20) Scott has a follow up question about getting a mortgage in retirement.
(28:45) An anonymous listener says it's too late for long term care and wants a recommendation for a low risk investment.
(35:40) Our next question comes from John related to being an executor for an estate.
(39:17) Dan asks a question about rebalancing.

SMART SPRINT

(43:46) In the next seven days, take a small step by naming the season of life you’re in—calm, choppy, rough, or changing direction—so you can better focus your energy on where to lean in right now.

UP NEXT

(44:40) Next week Roger chats with Tanya Nichols on the show and answers some of your questions.

REFERENCES

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Transcript

Click on a timestamp to play from that location

0:00.0	It's important in life and in retirement planning to name things.
0:07.2	Welcome to the show dedicated to helping you not just survive retirement, but to have the confidence to lean in and rocket.
0:15.8	I'm sort of laughing to myself.
0:17.0	I have so much fun hanging out here with you.
0:19.5	My name is Roger Whitney. If you are new to the show,
0:22.4	I'm a practicing retirement planner with over, wow, 30 plus years of experience, founder of Agile
0:29.4	Retirement Management. And we hang out here every week and we talk about how not just to talk
0:35.0	about retirement planning, but to be about it so you can go create a
0:39.6	great life with confidence, which is the whole point of the exercise. We forget that so often.
0:45.7	Today on the show, we are going to do a quick primer on direct indexing, which came from a client
0:52.6	question. We're going to answer a number of other questions
0:55.2	from people like you. In addition to that, we got a few tidbits from those out in the wild,
1:01.6	rocking retirement. I love those. Before we do that, though, I want to talk about acknowledging
1:07.8	and naming things in life and in retirement planning. This came up in two ways.
1:14.3	Number one was Nicole Mills and I were messaging. I forget what it was about. And I sent her a
1:21.2	message of, wow, I really want to acknowledge this beautiful season of life professionally. I get to work with amazing people
1:32.8	like Nicole and Tracy and Kim and Aaron and Troy and now Natalia and Lord Lee and Tanya. Tanya, my partner, and so many others. I want to acknowledge that. Not everybody gets to work
1:48.6	with a team that they get to bring into their life. And we work with clients that we really
1:55.1	love walking life with them. We feel like we are leaning into them from a process standpoint and making a difference
2:03.0	in some way. That's wonderful. I want to make sure I acknowledge that now while we're in the
2:07.6	midst of it, rather than when I'm 80 and reflecting on this. I just want to take a moment,
2:13.1	take a breath, and acknowledge that. So that's initially where it came up. And then we have been in the
	...

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