Now or Later?

Talking Real Money - Investing Talk

Don McDonald

Education, Business, Investing, How To

4.5 • 811 Ratings

🗓️ 23 October 2025

⏱️ 28 minutes

🔗️ Recording | iTunes | RSS

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Summary

Don and Tom revisit the Social Security debate after new Wall Street Journal and New York Times articles challenge long-standing advice to delay claiming. They dismantle clickbait claims that “waiting doesn’t make sense,” highlighting emotional biases, unrealistic investment assumptions, and spousal benefit considerations. The episode also covers whether Social Security counts as an asset, then shifts to listener questions about 529-to-Roth rollovers for graduate school, switching funds in an IRA, and managing company stock in an ESOP-based 401(k). 0:00 Why they keep returning to Social Security and why 25% of retirees rely on it entirely 1:43 Two-thirds claim before full retirement age; Wall Street Journal’s clickbait headline 3:02 The “bird in hand” fallacy and instant-gratification bias 3:48 Don’s confession: took Social Security at 69—and dogs ruined the travel plans 4:40 WSJ’s faulty 5%-return argument and why most investors won’t achieve it 5:43 The math: waiting pays more monthly, but longevity is the unknown 6:32 Trade-offs between retiring early, portfolio drawdowns, and spousal benefits 7:35 NYT’s claim that Social Security is America’s most valuable “asset” 8:08 Don’s rebuttal: it’s income, not an asset—you can’t liquidate it 9:49 Why people misclassify Social Security and how bonds fit differently 10:08 When and how to get a second (fiduciary) opinion on claiming strategies 11:00 The plague of commission-driven “advisors” and fake fiduciaries 12:29 Old brokerage “no-load fund” lies and how similar games persist today 12:40 Listener Q&A: overfunded 529 plan vs. Roth rollover for grad school 14:27 Midwifery degrees, student-loan math, and the 5% rate cutoff 17:13 Rollover IRA question: switching Fidelity funds to Vanguard ETFs 18:15 Active vs. index funds—why fees and diversification matter 20:05 Active-active management and small-cap risk humor 20:54 ESOP question: how much company stock is too much? (Hint: under 5%) 22:42 Selling discipline and diversification in employee-owned firms 24:39 Don and Tom joke about their own ownership and “sell-out” strategy 25:04 Daily calls, good-natured ribbing, and reminders about Saturday’s live show Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	yes we're going to talk about it again i know we've talked about it a lot but the reason we talk
0:07.2	about it is we're talking real money i haven't told you what it is yet but it's an important topic i
0:14.1	mean think about this for a minute 25% of retired americans 25% of retired Americans depend on this for pretty much all of their
0:25.3	income, for between 90 and 100% of their income. One out of every four retirees depends on
0:33.1	Social Security. So that's why we spend a lot of time on it. You ask a lot of questions about it.
0:40.3	A lot of articles get written about it because it's important that you do it as well as you
0:47.1	can do it given your particular situation and our lack of knowledge of the future. So what are we
0:53.2	talking about? Yeah, Social Security. Hi,
0:55.4	everybody, Don McDonald here in the Talking Real Money, Florida studio. Tom Cock in the Talking Real Money
1:01.2	made the Wall Street Journal town of Bellevue, Washington. Read up, read up about it. By the way,
1:08.7	Social Security, it's such a love,ate relationship, and we hear that from you.
1:13.1	In fact, when I was thinking about this last night, I think it's probably the greatest love-hate relationship since the movie maybe romancing the Stone or when Harry met Sally or maybe even Tom and Jerry.
1:27.2	I mean, it's just people just love-h weird. Didn't they become love love? Yeah, kind of. Anyway, I go back and watch it and figure it out. But the bottom line is you, you left out one part of the, all the reasons why it's so important. And that is, well, I had to start the show. Okay. Still, it's still, it's's still, it's still about two-thirds of us take Social Security before full retirement age. It's about, it's about two out of three people. Now, there may be some circumstance for some where it makes sense, right? You need the money. Your health isn't good. Your longevity is not, it's not going to happen. Okay. But for most people, they still don't make good decisions. So, yeah, we read a lot about this. We talk a lot about this. And two new pieces this week, one from the Wall Street Journal, and then one from New York Times talking about Social Security. So, and I love these headlines because they're provocative.
2:19.9	Wall Street Journal, why delaying your Social Security benefits may not make sense.
2:25.3	In other words, you know one of the things we have told you, delay, delay, delay, and here it is telling you don't delay.
2:29.7	That is such clickbait.
2:31.6	That is such clickbait because they know that people are going to, because
2:35.1	so many people take it early, they're going to go, this will justify my decision. Click.
2:41.2	Yeah. And I'm sure, I'm sure it worked. It says, by the way, in the article, that still only 10%
2:48.2	of Americans waited until age 70. As I mentioned before, about two out of three claim it before four retirement age. But, it's a little 10% of Americans waited until age 70.
2:51.1	As I mentioned before, about two out of three claim it before four retirement age.
2:54.8	But let's talk about some of the reasons the authors thinks, well, sure, that might make sense.
	...

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