The Four Fundamentals of Retirement Drawdown

BiggerPockets Money Podcast

BiggerPockets

Investing, Education, Business

4.6 • 2.9K Ratings

🗓️ 26 September 2025

⏱️ 63 minutes

🔗️ Recording | iTunes | RSS

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Summary

Join Mindy Jensen and Scott Trench on the BiggerPockets Money Podcast as they welcome retirement tax experts Sean Mullaney, The FI Tax Guy, and Cody Garrett, a certified financial planner, to break down their game-changing retirement drawdown order of operations. This isn't your typical retirement advice - it's a strategic blueprint that could save early retirees and traditional retirees thousands in taxes while ensuring their money lasts a lifetime. Discover the four critical retirement drawdown fundamentals that form the backbone of any successful retirement strategy, plus advanced tactics for optimizing your tax burden, managing healthcare costs, and timing Roth conversions for maximum impact. Sean and Cody don't just explain what to do - they walk through exactly when and why each strategy matters most, covering everything from your retirement date through the challenging widow and widower years. This episode covers: The four fundamental retirement drawdown rules that could save you thousands Why you should spend taxable accounts first and traditional accounts second The strategic case for delaying Social Security until age 70 How to use HSAs and Roth IRAs as powerful tax-free tools The five distinct phases of retirement and what each one means for your strategy Advanced Roth conversion tactics and optimal timing How to keep income low to maximize ACA premium tax credits Managing required minimum distributions and minimizing their impact Healthcare cost planning and insurance strategies for retirees Why working with a qualified tax planner is essential for your unique situation And SO much more! 00:00 Retirement Drawdown Strategies 01:22 Fundamentals of Retirement Drawdown 03:37 Phases of Retirement and Taxable Accounts 07:23 Managing Income and Premium Tax Credits 09:22 Roth Conversions and Standard Deductions 19:52 Hidden Roth IRA and Tax Planning 28:36 Navigating Healthcare Subsidies and Early Retirement 29:26 Balancing Benefits for Early Retirees and Self-Employed 33:34 Strategic Tax Planning for Retirement 35:50 Understanding Required Minimum Distributions (RMDs) 36:59 Mitigating the Impact of RMDs 40:51 The Widow's Tax Trap and Effective Tax Planning 46:30 Connect with Sean and Cody! Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	We've talked about the investment order of operations here on Bigger Pockets Money in order to minimize taxes during the accumulation phase.
0:08.3	But just as important for those pursuing early or traditional retirement is how we withdraw or decumulate from our portfolios.
0:16.9	Sean Mullaney, the FI tax guy, and Cody Garrett, CFP from Measure Twice Financial Planners,
0:22.7	have pioneered the withdrawal order of operations, and we are very excited to share this with you today.
0:34.1	Hello, hello, hello, and welcome to the Bigger Pockets Money podcast.
0:37.3	My name is Mindy Jensen, and with me as always is my not yet drawing down co-host, Scott Trench.
0:43.6	That's right, Mindy.
0:44.2	I'm accumulating both a portfolio of financial assets and a portfolio of introduction puns.
0:49.4	All right, we are so excited to be joined today by Sean Mullaney and Cody Garrett on the podcast.
0:53.4	We have had them several times here at Bigger Pockets Money.
0:57.1	And they were most recently here in our last episode to talk about taxes in early retirement and how your effective tax rate will almost assuredly be lower after you leave your job.
1:06.3	Today, we're going to cover the mechanics of how that actually works and a order of operations about how to
1:13.4	minimize those taxes in early retirement. John and Cody, welcome back to Bigger Pockets Money.
1:18.0	Thanks so much for having us back. We're glad to be back. All right. Sean, can you please,
1:22.8	without further ado, tell us what these four fundamentals of retirement drawdown are?
1:27.2	Yes, Scott. And I'm going to give you just a little ado, if you don't mind.
1:30.4	All of us come into retirement, regardless of when it is, with different portfolios, different backgrounds,
1:38.2	different investments, different mixes of taxable Roth traditional.
1:42.3	But what we do is we sort of break it down. If we could just
1:45.6	anchor us four simple fundamentals for retirement drawdown and then we can do the tangents
1:52.9	and but in my case and all that sort of stuff. We want to start off with like an anchor
1:56.9	with a framework. And so in a theoretical, ideal world, we would draw down with the
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