The Crushing Cost of Conservative Retirement Planning (SB1597)

The Stacking Benjamins Show

Joe Saul-Sehy and Josh ‘OG’ Bannerman, CFP

Personal Finance, Financial Planning, Education, Retirement, Investing, Cfp, Business, Money

4.4 • 2K Ratings

🗓️ 5 November 2024

⏱️ 55 minutes

🔗️ Recording | iTunes | RSS

🧾️ Download transcript

Summary

Today, we'll discuss the pitfalls of overly conservative retirement planning and how it could delay your financial independence and retirement dreams. In this show which was originally aired on our "brother" show Earn & Invest, Doc G, and guest Jesse Cramer from the Best Interest podcast delve into the importance of finding a balance, exploring the impacts of stacking conservative assumptions related to social security, investment returns, and inflation. Jesse shares practical tips on re-evaluating your retirement assumptions, emphasizing the significance of flexibility and ongoing adjustments to avoid unnecessarily prolonging your work life.

RUN OF SHOW

Introduction and Topic Overview
The Cost of Being Too Conservative
Interview with Jordan Grumet and Jesse Kramer
Workplace Benefits Guide Announcement
Earn and Invest Podcast Begins
Jesse Kramer's Background and Career Shift
Conservative Assumptions in Retirement Planning
Introduction to Conservative Retirement Assumptions
Guest Introduction: Jesse Cramer
The Impact of Conservative Assumptions on Retirement
Strategies to Avoid Overly Conservative Assumptions
Revisiting and Adjusting Retirement Plans
The 4% Rule and Its Implications
Balancing Conservatism and Aggressiveness in Retirement Planning
The Consequences of Overly Conservative Planning
Practical Tips for Retirement Planning
Exploring the 'Die With Zero' Philosophy
Dealing with Loss Aversion Anxiety
Conclusion and Final Thoughts
Post-Interview Discussion

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Transcript

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0:00.0	Hey there, Stackers. I'm Joe Salcii. And what's the cost of being conservative?
0:07.0	It's funny because we think, well, I don't want to lose money, so I'm going to be really conservative. But what if you very safely never get anything done? And that truly is the cost. Isn't it? In today's show, which is from our brother's show, Earn and Invest, we're going to be chatting
0:25.7	about exactly that.
0:28.0	What is the cost of maybe, just maybe, being too conservative and never getting where you
0:35.1	want to go?
0:35.6	It's hosted by my good friend Jordan Grummet,
0:38.3	aka Doc G, at Earn and Invest.
0:40.5	And it's an interview with our also good friend, Jesse Kramer,
0:46.3	and Jordan Grummet joins me now.
0:48.7	Doc G., why was this interview so important to you
0:52.4	to talk about maybe being too conservative? Well, I think the problem is
0:57.5	we're so worried about running out of money that we end up being incredibly conservative on not just
1:04.3	one aspect of retirement savings, but multiple. And see, the problem is when you start stacking these conservative assumptions, they become
1:13.9	exponential.
1:14.6	So it's one thing if you're like, I need a safe withdrawal rate of 3.75 instead of four, that's
1:19.6	going to make a certain amount of difference.
1:21.4	But if you add that onto discounting the fact that you're going to get Social Security
1:25.4	and deciding that equity's returns
1:28.1	are going to be 4% instead of 6% or 8%. And when you stack those all together, eventually what
1:34.3	you end up with is someone who's been so conservative, they have tons more money than they expected.
1:39.1	And the goal is to actually spend the money, isn't it?
1:42.0	So I love that on one side.
	...

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