Using Buffered ETFs: EDU #2607

The Retirement and IRA Show

Jim Saulnier, CFP® & Chris Stein, CFP®

Business, Investing

4.3 • 729 Ratings

🗓️ 18 February 2026

⏱️ 79 minutes

🔗️ Recording | iTunes | RSS

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Summary

If you would rather not listen to the guys’ banter about Jacob’s upcoming move to Iowa, Jim’s garden planning, and a listener correction about the word “imbibe” you can skip ahead to (33:30).

Chris’s Summary
Jim and I are joined by Jacob Vonloh as we discuss using Buffered ETFs prompted by a Morningstar article titled “Buffer ETFs Are Not for Everyone.” We explain how defined outcome ETFs use options to provide an explicit amount of loss protection over a given period while limiting potential gains, and we outline why these products are generally suboptimal for long-term investors. We then connect this to investment positioning, focusing on risk capacity, distribution planning, and why dollars assigned to delay-period Minimum Dignity Floor and Go-Go spending may require a degree of principal protection.

Jim’s “Pithy” Summary
Chris and I are joined by Jacob Vonloh as we take a listener-submitted Morningstar article—“Buffer ETFs are not for Everyone”—and use it to kick off what is going to be a series on principal protection. Morningstar does a very good job in this article laying out what it likes about buffered products, and it also makes some excellent points on where these types of products would fit and where they don’t fit. They’re not for everybody, but they could be of interest in certain cases, in a certain application, and we’re going to share how we use them.

What I want to do in this series is broaden the conversation. Buffered ETFs are just one type of principal protected product. There are multiple tools in that category, and we’re going to walk through where they fit into distribution planning. As you transition from accumulation into what I call the Venn diagram phase, and ultimately into distribution, you have to stop thinking of your portfolio as one big portfolio and start thinking in terms of smaller portfolios—investment positions—based on assigned spending. Dollars earmarked for a legacy position can be invested aggressively. Dollars earmarked for immediate spending—like the Go-Go reserve or the reserve for your MDF—need a degree of principal protection. This ties directly into the Secure Retirement Income Process and the See Through Portfolio and how we navigate asset positioning in retirement.

Show Notes: Morningstar Buffered ETFs article

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Transcript

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0:00.0	The retirement and IRA show represents the words and views of the show hosts exclusively and should not be construed as investment legal or tax advice. All information is believed to be from reliable sources. However, we make no representation as to its completeness or accuracy. All economic and performance information is historical in nature and is not indicative of any future results. Any indices mentioned on the show are unmanaged and cannot be invested indirectly. Diversification and asset allocation strategies do not assure profit or protect against loss.
0:23.7	Never make any investment or financial decisions based on information offered on this show
0:26.8	without first consulting your financial legal or tax advisor.
0:29.6	Financial planning services offered through Jim Solnior and Associates LLC, a registered investment advisor.
0:47.0	This is the retirement and IRA show coming to you from beautiful Northern Colorado.
0:52.6	Join us as certified financial planner Jim Sonier, as well as Colorado State University Finance instructor and certified financial planner Chris Stein teach you about IRAs,
0:58.0	borrow-in-case, annuities, Social Security, pension plans, and estate planning in a fun and enjoyable show.
1:05.0	Whether you are listening live in Colorado or streaming from their website or iTunes podcast,
1:10.0	Jim and Chris want you to know that
1:12.2	they're available to help you plan for your retirement. Just visit their website at Jimhelps.com.
1:18.3	That's Jim H-E-L-P-S dot com and click the Meet the Team button on the homepage. Now here's Jim and Chris
1:26.0	with today's show.
1:35.0	Well, hello everybody and welcome to the Retirement and IRA show EDU edition for this week.
1:42.3	This week's show is prompted by a listener who sent us in an article from Morningstar that entitled, I may as well just read the title and that'll give
1:47.6	you a sense for where we're going today.
1:49.6	Title was Buffer ETFs are not for everyone.
1:53.8	Here's how to use them in your portfolio.
1:56.9	So it was an interesting article that kind of got our creative juices flowing, if you will.
2:04.4	And we thought it would be great for Jim and I, not only to talk about them,
2:10.5	but bring in Jacob from the office here who works most closely with our clients in the positioning of their assets.
2:20.0	Positioning is the, what we describe, our version of asset allocation, if you will.
2:27.6	We've talked about it previously.
	...

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