Someone with half a million dollars confidently retires and thrives. Someone else with a full million dollars runs into trouble within a few years. The dollar amount alone never tells the whole story, and today’s episode proves it with three real scenarios side by side. Joe and OG walk through exactly what changes the math: your age, whether Social Security has kicked in yet, how much of your spending is already covered by guaranteed income, and how many years that portfolio actually needs to stretch.
What You’ll Walk Away With
- Why the question to start with isn’t “how much do I have,” it’s “what’s the gap between my expenses and my guaranteed income”
- A real comparison of three retirement scenarios (500k, 750k, and 1 million) that shows why the smallest portfolio can actually be the least risky
- Why the “safe withdrawal rate” debate among experts (ranging from under 4% to over 5%) matters less than having a plan for flexibility
- The often-overlooked lumpy expenses, property taxes, insurance premiums, home repairs, that can quietly wreck an otherwise solid retirement budget
- Why retiring early and taking Social Security ahead of schedule creates a double reduction that compounds for both you and a spouse
- A clear breakdown of how many years you actually have left to “practice” your retirement spending before you commit to it
Why This Matters Now
A specific dollar figure feels like it should provide an answer, but retirement security depends on the relationship between that number and your actual life: your fixed expenses, your guaranteed income, your timeline, and your flexibility if plans change. Two people with wildly different account balances can have equally solid plans, and two people with the same balance can be in completely different positions depending on when they start drawing from it. The real work isn’t chasing a bigger number. It’s understanding exactly what gap that number needs to fill.
From the Basement
A Social Security deep dive digs into a genuinely useful and underdiscussed detail: how retiring early doesn’t just shrink your own benefit, it can shrink a spouse’s spousal benefit too, and by how much. Plus, a Golden Girls trivia detour and a listener note that sparks a good, honest conversation about teaching kids to give.
Resources Mentioned
The 201 Newsletter — deeper dives on topics covered in the show
Stacking Benjamins Field Kit — the all-in-one budgeting and net worth tracking tool
SSA.gov — create an account to download your official Social Security earnings statement
Our Headline
- The State of Retirement Income: 2025 (Morningstar)
Doug’s Trivia
- What name was ultimately given to the hit series that was originally going to be called Miami Nice?
Have a question for the show?
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Other Mentions
- Adaptive Asset Allocation (with Michael Philbrick)
- Is the 4% Rule In Play? (SB1702)
- Carving Out a Robust Retirement Spending Plan
- We Answer Your Awesome Questions: HSAs, Roth Conversions, Trusts, and More (SB1730)
Join Us Wednesday
Tune in on Wednesday when we talk with longevity expert Lynda Gratton about rethinking retirement, redesigning the traditional life path, and what it could mean to live well for 100 years or more.
Written by: Kevin Bailey
Miss our last show? Listen here: Why “Doing It Yourself” With Money Is Costing You SB1896 | Stacking Benjamins
Episode transcript
[00:00:00] Doug: In a world where overspending, debt, and keeping up with the Joneses rules us all, where the voices from the merchants, restaurants, and credit companies lord over the common man, out of the darkness, like a beacon of hope, comes a new voice, a voice that’s rich and creamy, like your favorite butter, and delicious like cheeseburger pizza on your diet cheat day.
[00:00:31] Doug: It’s the Stacking Benjamins show
[00:00:40] Doug: Live from Joe’s mom’s basement, it’s The Stacking Benjamins Show
[00:00:55] Doug: I’m Joe’s mom’s neighbor, Doug, and here’s a question. How little does it take to retire and not regret that you’ve left the workforce? Today we’ll talk about retirements of 500,000, 750,000, and a million dollars, and what bumps in the road people with these amounts of money can expect. But that’s not all.
[00:01:13] Doug: Anna and OG are back with week two of their current financial basics series. And of course, I’ll swoop in halfway home with some of my heartwarming and feel-good money trivia. And now, two guys who always feel good rolling out of bed on a Monday because they get to spend it with you, it’s Joe and OG, G-G-G-G-G.
[00:01:43] Joe: Oh, Doug, flattery. Flattery for the win on a Monday. Hey, everybody, happy Monday to you. I am Joe Saul-Sehy. I got the raspy voice going today. Been doing a little bit of traveling, and, uh, excited to be back in the basement alongside my pal OG, who’s also been traveling. You’ve been, uh, peddling your, uh, little feet off.
[00:02:04] OG: Yeah, I’m never doing it again.
[00:02:05] Joe: The bicycle’s dead to you?
[00:02:07] OG: If anybody wants a bike, it’s for sale. Free to a good home.
[00:02:11] Joe: OG suddenly realized this miracle called a car is just even more amazing than he thought it was. It was
[00:02:17] OG: very hot last weekend. One star, do not recommend.
[00:02:21] Joe: Rode in the hotter than hell, a ride that I’ve also done.
[00:02:24] Joe: Although, you did the full monte. You went all the way to 100 miles. I
[00:02:28] OG: did do a full monte. How did you know? There were police and everything. It was like a police escort. It was great.
[00:02:35] Joe: I did 100K when I did it. I was not gonna do the 100 miles, so congrats to you, man.
[00:02:41] OG: Wait, I could’ve done 100K? There’s an option?
[00:02:45] Joe: Who knew?
[00:02:46] OG: What the heck?
[00:02:47] Joe: I think there was even… Wasn’t there even a 50K?
[00:02:50] OG: Actually, I saw on the thing that there was 10, 25, 50, 75, 100, and I’m like, “What the… What am I doing? I could’ve done, like, 20 minutes.” Like, go up there, ride my bike for a little bit, get a little sweat on. Get the T-shirt. I’ve been home for a kickoff of the TCU game.
[00:03:07] Joe: I don’t know, dude. It doesn’t always have to be going over mountain passes and 100 miles- I know … in the Texas heat.
[00:03:13] OG: Jeez.
[00:03:13] Joe: Like, what are we thinking? I wish somebody
[00:03:14] OG: would’ve told me.
[00:03:15] Joe: Yeah, if only there was some- somebody out there who knew that ahead of time. We got a great show today, OG, because people often ask you all the time, “Hey, I got $500,000.
[00:03:27] Joe: Think I can retire? I got a million dollars. Am I close to retirement?” What’s funny is this answer is more nuanced than people think that it is, and we’re gonna paint that picture. We’re gonna show you what you really need to know before you decide to tell the boss to shove it. That’s gonna be the focus on today’s show, but before that, we’ve got a couple sponsors who help us keep on keeping on.
[00:03:51] Joe: We’re gonna hear from them, and then OG and I are gonna come back, and we are going to walk through, what if you got $500,000? Can you go today? I think you might be able to. 750? Sounds good. Million dollars? Okay, I’m listening. Let’s see what the bumps in the road might look like. Remember Superman, it’s a bird, it’s a plane, it’s Superman.
[00:04:12] Joe: We built the equivalent for your money. It’s a budgeting app. It cancels subscriptions. It protects and helps you build credit, tracks your net worth. So many more. It’s the super app Field Kit. Bum, bum, bum. You don’t wanna spend time managing your money. You wanna live, so get Field Kit so everything is in one place and you stop staring at screens all day.
[00:04:32] Joe: Check it out at stackingbenjamins.com/fieldkit.
[00:04:42] Joe: Well, today we’re gonna do retirement by the number stackers, $500,000, $750,000, million. And I know what happens when people hear those numbers. Somebody hears $500,000, OG, and goes, “I’m set.” Like, that is great. There’s actually a woman on TikTok who very confidently gives advice, and I was like, uh, I’m, I’m watching her video, and she’s just saying things with such this tone in her voice.
[00:05:10] Joe: And she goes, “Hi, my name is so-and-so, and I retired at 53 with half a million dollars.” And immediately to me, as a guy who’s been in this industry for 30-plus years, I immediately just shut down. I’m like, “Nope, that’s not working for me.” She has yet to see what the other side of that looks like.
[00:05:32] OG: Well, maybe. I mean, frankly, I’ve had clients that retired with half a million dollars.
[00:05:36] OG: I think we’ll talk a little bit about that today. There’s some analogy there about are you, uh, able to, are you able to make it? But it’s not how much you got, it’s how much you keep, so.
[00:05:46] Joe: Yeah, good point.
[00:05:47] OG: It’ll be fun, fun conversation today.
[00:05:49] Joe: But I do think that, um, to present that without all the, “And here’s how I did it,” and just be like, “I’m your guru for everybody.”
[00:05:56] Joe: Eh, I, I, I don’t know. Anyway, somebody else, though, OG, has a million dollars, and I know there’s other people in our audience who go, “I could never retire with that little money.” Yeah. Like, “I’ve done my own math and I need, I need more.” Both these people might be right.
[00:06:11] OG: Mm-hmm.
[00:06:12] Joe: Here’s the big question: Where do we start?
[00:06:15] Joe: Before we launch into these three different people, I wanna start with the $500,000 person. What do we need to know before we retire? In other words, I don’t think the place to start is, “Hey, I got $500,000, OG, can I go?” You’re gonna have some questions back to them. What are some of the questions that the person needs to answer first?
[00:06:37] OG: Well, I think a couple things. Firstly, I wa- I wanna know what sort of guaranteed income streams you might have. You know, it’s different if you’re 52 years old with half a million dollars, like your, like your person that you mentioned on, on the internet, ’cause you probably don’t have Social Security at that point.
[00:06:56] OG: You could have a pension, you know, maybe a school teacher, worked for 30 years. That’s pretty common. You know, maybe you could, uh- Police officer,
[00:07:03] Joe: firefighter …
[00:07:04] OG: yeah, yeah, service related type of thing. What kind of guaranteed income is a big component there, and/or are you planning on retiring from your current job, but you’re gonna have a little bit of side income.
[00:07:15] OG: You know, I’m gonna stop, I’m gonna stop my nine to five, but I’m gonna work weekends at Home Depot and pick up a few bucks or, you know, whatever. So that’s important. I, I wanna know what the situation is relative to fixed expenses. What kind of debt payments do you have still? Um, obviously the person who has a paid for house and no car payments and no, you know, credit card bills and no student loans left and, you know, all that sort of stuff, uh, is…
[00:07:43] OG: That person’s gonna be in much better shape than… You know, you can only eat so much food. You know what I mean? Like, you go out to dinner every single day, every day of the year, that pales in comparison to having a mortgage payment and a car payment and some student loans and a little bit of consumer debt.
[00:08:00] OG: You know what I mean? Like, if you take away the guaranteed fixed expenses, and now all you have to do is just your consumption, that’s very adjustable. You know, you can say, “Well, this week is high expenses because I wanna go out to eat. Next week is low expenses,” or, you know, travel or whatever. So that’s a really big component.
[00:08:19] OG: And then also I wanna kinda look to the future and say, like, “Are there any big things on the horizon that we should know about?” Again, retiring at 53 with a middle schooler, which is what I would have if I retired at 53, is a different thing than retiring at 53 being an empty nester Because if I retired at 53 and somebody looked and said…
[00:08:43] OG: They’d go like, “Wait, what, you have col- like what are you doing for college? That’s a big thing coming up on the horizon.” I’m not saying you have to pay for it, I just need to know like what are you thinking you’re gonna do with that? Because, you know, if you think you’re gonna stroke a $100,000 check for college in four years, we should probably put that in the plan.
[00:09:01] Joe: This brings up this huge point, which is, again, that we don’t start with the amount of money. W- what we need to do is figure out… W- what I’m hearing, OG, is we need to figure out what the gap is. If my lifestyle costs X, and that those income streams you talk about cover Y, then my portfolio needs to produce Z, right?
[00:09:24] Joe: It just needs to fill the… So the big question you’re asking is, what’s the gap and how long are these gaps, and what are the bumps in the road gonna look like?
[00:09:32] OG: Yeah, and I think the other thing to consider too is magically changing your lifestyle from one tier to the next is not very realistic. I know that people can do it because people lose jobs and they have, uh, layoffs, or they get, pff, you know, forced to early retire and, you know, you gotta figure out what you’re gonna do.
[00:09:54] OG: But if you have the opportunity to choose your retirement, I don’t know of anybody who has done an early retirement and purposefully reduced their lifestyle, or been able to do it. You know, it’s like, it’s like you’re just used to l- the experiences that you have. And I don’t mean experiences like travel experience.
[00:10:16] OG: I, I mean, you know, you shop at a certain grocery store. You buy a certain amount of name brand stuff. You have this cable package. You know, does anybody have cable anymore? You know, streaming package. You replace your car at this frequency. Like this is who you’ve become. And while it’s not impossible, it’s like changing somebody over who’s like an amazing spender y- to turn them into being an amazing saver.
[00:10:42] OG: It’s just not in your nature, you know? And it, it’s hard. It’s not impossible, but it, it takes a big amount of discipline to do.
[00:10:51] Joe: Well, you brought this up on graduation day. I like the clip that you played about getting disciplined ahead of time. So if you think you wanna retire and you have a wide gap to fill, can you narrow that gap and work at narrowing the gap, I think, before you retire?
[00:11:09] OG: I think this was one of your things, right? When you were an advisor still it was like, if you think you can live on 2,000 a month, then you should be saving 2,000, you know
[00:11:17] Joe: Yeah, play test it … y-
[00:11:19] OG: you should be putting two grand a month in your brokerage account right now. “Well, no, no, I can’t right now, but I will as soon as I retire.”
[00:11:25] OG: Okay. Okay, buddy.
[00:11:27] Joe: Right, Pinocchio?
[00:11:28] OG: Yeah. Sure, buddy. So if you think you can, then do it, especially if it’s a big reduction. And I don’t say that to be like snarky about it. I’m not trying to pee in somebody’s Cheerios. I’m just saying it’s just really hard to do that when you have the other option of like, “Well, I’ll just work a couple more years,” if you had that option, right?
[00:11:49] OG: If you don’t have the option- Yeah … it’s a different scenario
[00:11:52] Joe: All right, so the first place that we’re working from, Stackers, then is not the amount of money. It’s figuring out the gap. That is step one. What is this amount of money going to fill? So if it’s 500,000, 750, or a million dollars, w- what’s the gap?
[00:12:04] Joe: The second is figuring out… We’re not gonna get into portfolio construction today. We have other episodes for that, and we can link to those in the show notes. We do have to talk about how much we’re gonna take out of that portfolio. Now, I, for those of you that have heard me talk about this 30 times here, on Afford Anything, on stage, wherever, I am not a fan of taking out the bleeding edge from your portfolio because I believe that creates a bunch of stress, and the last thing somebody wants in retirement is a very, very stressful retirement where you’re taking out every single penny that you can.
[00:12:42] Joe: But what I wanna do is use a number, OG, that we can use for 500, 750, and a million just to get a level playing field. Follow me? So not a huge fan of the safe withdrawal rate. In fact, I became less of a fan last year, OG, when Bill Bengen, the guy that originally proposed the safe withdrawal rate at 4%, bumped it up and said, “Hey, it might be, under a lot of circumstances, 5.2,” and then just a couple months later, Morningstar and their research team comes out with their white paper that says, “Uh, we think it’s 3.9.”
[00:13:20] Joe: So we can’t even… We got these huge experts that can’t even agree on what the safe withdrawal rate is, OG. Is it 5.2? Is it 3.9? Like, I know part of it is how you invest, but this idea of safe withdrawal rate drives me crazy for, well, for the reason that we can’t decide what it is.
[00:13:39] OG: Well, the reality is is that you have absolutely no idea what your portfolio’s gonna do.
[00:13:46] OG: You don’t know how you’re gonna behave when your portfolio doesn’t behave the manner in which you expect it to. I actually think that putting a stake in the ground around a certain percentage is probably as good a spot to start as any, and I think it’s safe to say that we probably could all agree that 10%’s probably too high despite the fact-
[00:14:07] Joe: Well, except, except one dude in Tennessee-
[00:14:09] OG: Yeah
[00:14:10] Joe: who thinks that’s a, just a fine number.
[00:14:12] OG: Well, I mean, again, in the last 15 years, the market’s done really well, and you probably could have taken 10% out and probably been okay. Save a year or two in there that probably nuked it up a little bit, 2022 maybe. Or you have this dynamic withdrawal that is, you know, I’m just gonna live on whatever it produces of returns.
[00:14:35] OG: But the question then is, well, if you have a negative year, do you wait for it to get back to even money before you start… You know, it’s like, it’s just unreliable. That’s not how life works. Your electric bill’s your electric bill. You can’t call- That’s
[00:14:46] Joe: what I was thinking …
[00:14:47] OG: call them up and say- “
[00:14:48] Joe: My portfolio’s down.
[00:14:48] Joe: Give me a year.”
[00:14:49] OG: Yeah, I’m good for it, but I’m gonna need to, need to wait for the market to recover. So I think it’s as good a spot as any, and if you, if you say, “Well, it’s, you know, I believe it’s five,” I go, “Okay,” you know, whatever. It’s probably not 10. It’s probably something greater than two or three, ’cause you’re trying to balance out life expectancy and return on life.
[00:15:10] OG: You know, you probably don’t need to retire with half a million and die at 92 years old with four million. You know, you kinda probably left a little on the table. If you wanted to, I’m not saying you have to spend the money.
[00:15:21] Joe: Yes.
[00:15:22] OG: But I would put a finger on the weight at around 4 or 5% and be okay with that as a starting point.
[00:15:26] Joe: Well, for this exercise, I went with the 3.9, and, and the reason I did- I can’t do that
[00:15:31] OG: math in my head, so I go with
[00:15:34] Joe: five. Well, I’ve already done the math for you for this, for this exercise, so we’re gonna be good. But the reason I went with the low one is because I want the less stressful retirement.
[00:15:43] OG: Well, I’m gonna give you a little pushback.
[00:15:44] OG: I know that that wasn’t your intent here, but, um, that’s okay. This is what makes a great radio, Joe. I think the alternative of being a little overspendy early is less stressful. The difference between 4% and 5%’s five grand on half a million dollars, right? Which is, for maybe a lot of us, not the world’s most profound delta.
[00:16:08] OG: But $400 a month, if you kind of break this down into a monthly thing, you know, if I’m assigning dollars to this, I’m going like, “Where, where does this $400 go?” That’s easily your grocery budget if you’re a empty nester. It’s easily your cellphone, water, and maybe your electric bill. I do think it’s different to say, you know, hey, is this, is this four or is it five, or n- you know, 3.9 versus five or something like that, with a little bit of an asterisk being You have to be amenable to making some small changes.
[00:16:41] OG: You know, like our friend Paul Merriman says, you know, if things are really great, then maybe I can bump it up a little. If things are really crappy, then, you know, it’s a little lighter if you have that flexibility.
[00:16:53] Joe: No, 100%, and you’re actually getting into a more nuanced discussion that I think we have to table for today and build a whole nother episode around because I do think- Yeah
[00:17:04] Joe: I think, y- you know, when we had Dana on the show, Dana Anspach, I know that she, like you, OG, looks at it, uh, uh, th- take out more, but monitor it. And I think if you have a professional in your corner, I feel much more comfortable that that will get done, right? And that the level of stress that you’d have while you’re working through your retirement savings, while you’re spending in the early years and you’re spending more than the 3.9 that I suggested here, then y- you’ve got somebody who’s helping you recalibrate, somebody who’s worked with a much bigger swath of people, so they know that, “You know what?
[00:17:44] Joe: You’re gonna be okay. Here’s our strategy. If the market changes and things don’t work the way that they are now, here’s what our game plan is.” But if you’re not working with somebody, what I generally see from a do-it-yourselfer is panic, right? Is sitting in front of your favorite news show, complaining about stuff in Washington, watching the stock market on CNBC or Fox Business, yelling about inflation.
[00:18:09] Joe: The price of eggs drives you crazy. You worry the whole time because you’re on this island by yourself. So if you’re gonna be that person, then I would just prefer you stay away from the safe withdrawal rate. So that’s why I went with the low number. So at $500,000, that’s about 19,500. 750,000, that’s 29,250, and at a million dollars, that’s 39,000 bucks.
[00:18:35] OG: C- can we just say 20, 30, and 40? Are you okay with that rounding, Joe?
[00:18:41] Joe: We could, but I didn’t. I actually did the regular… I did the, I did the work here, man. Don’t
[00:18:47] OG: 20,
[00:18:48] Joe: 30, 40. Don’t make me, don’t make me round when I did the actual work.
[00:18:51] OG: And the other thing, by the way, as you quoted those numbers, I think we have to make this monthly We don’t live our lives in annual increments.
[00:19:00] OG: You know what I mean? Like, if somebody asks you how much money you make, rarely do you quote your annual gross salary. You would say, “Well, I bring home 3,500 every paycheck, I guess.” You know, like, that’s the, that’s the rhythm that we’re used to. I would look at this and I would say 1,700 bucks a month.
[00:19:21] Joe: Yeah.
[00:19:21] OG: And then maybe $2,500 a month. Yeah. And then maybe $3,500 a month. That’s… Those are kind of your numbers.
[00:19:27] Joe: All right, so let’s do this. 500,000 bucks, they’re bringing home 1,625 a month. All right?
[00:19:32] OG: Sure,
[00:19:32] Joe: yeah. So let’s start with that. I’m gonna say somebody comes up to you, they got $500,000. I’m gonna introduce them to you a little bit at a time.
[00:19:40] Joe: Okay. And you tell me your thought. Like, does this immediately make you go, “Oh, that’s good,” or, “Eh, that’s a yellow flag.” So $500,000 person comes to you and goes, “I’m 65 years old, and I have $500,000.” Mm-hmm. Your thought based on that age
[00:20:00] OG: I mean, so I have so many questions. Uh, just based on the age- Just based on the age
[00:20:07] OG: uh, I would say probably doable. One word answer, doable.
[00:20:11] Joe: Well, you like it. I like it because y- you’re eligible for Social Security.
[00:20:15] OG: Yeah, doable.
[00:20:17] Joe: I also like it, number two, because you’re not trying to do the early retirement thing where you’re putting, uh, more strain on your portfolio. So I like that. Second thing, mortgage is paid off.
[00:20:27] OG: We’re 65 and the mortgage is paid off?
[00:20:29] Joe: Yes.
[00:20:29] OG: Okay, we’re just stacking this. Yes, 100%. Like you’re, you’re slow playing the data to me. I
[00:20:33] Joe: am. That’s exactly what I’m doing.
[00:20:35] OG: All right, 65 and mortgage paid off, um, more doable.
[00:20:40] Joe: Even better. 100%. And the reason I like that is because $500,000, frankly, OG, for 65 to what could be 105, is we’re gonna have Linda Gratin on Wednesday, who’s a longevity expert, and talking about redefining this whole idea of retirement.
[00:20:57] Joe: Mm-hmm. So if you’re looking at that amount of time, having as few bumps in the road as possible I think really helps. Third thing, Social Security covers almost all my basic expenses
[00:21:11] OG: Um, that makes me pretty comfortable. I would wanna go through and define what your basic expenses are. But honestly, I think this is a little bit more common than people think when you, when you consider basic expenses being things like food and electricity and water bill and heating and that sort of thing.
[00:21:31] OG: I will tell you, the area that people f- don’t really forecast very well in their brains is the annual expenses or less than monthly expenses that come out or, or less frequently than monthly expenses. If you have a paid for house, you probably still pay property taxes. But in a lot of states, your property taxes are once a year, maybe they’re twice a year.
[00:21:54] OG: Maybe they’re twice a year, and they’re vastly different numbers. Like my mom’s house in Michigan, one of the tax bills is 1,000 bucks, and then one is 5,000. You know, so it’s kind of an asynchronous- Yeah … and is that due six months apart? It’s like one’s due in September, one’s due in February. So it’s not really- How clunky
[00:22:11] OG: it’s just, it’s just weird timing. Or auto insurance, right? Like, or your house insurance, sometimes you pay annually. And so when we think about these monthly expenses, we think like, “Oh yeah, my Amex bill’s 1,500 bucks a month, so yeah, my Social Security covers all of it.” Like, well, except for Christmas when you Christmas shop, or except for September when the property taxes are due.
[00:22:35] OG: So be careful with those oddly timed expenses.
[00:22:39] Joe: Well, and that’s great because in the person’s back of the envelope math, they think they need only about 1,250 a month from the portfolio. And so if they can take 1,600 a month, that’s gonna cover, I think, a lot of those surprises that you talk about, OG.
[00:22:56] Joe: They’re gonna have to be careful. And I think they’d have to keep a good… make sure they got that emergency fund in place. But I think it- Mm-hmm … covers it But then not only are they looking at retiring, their roof is also thinking about retiring right now, and so is their HVAC system.
[00:23:14] OG: Mm-hmm. I have some of those retirements pending in my house right now presently.
[00:23:19] OG: You can tell.
[00:23:20] Joe: Getting ready for the party?
[00:23:21] OG: Yeah. There’s not a party coming. It’s like more like put out to pasture.
[00:23:25] Joe: Yeah.
[00:23:26] OG: So how do I feel about that? Well, I’m not afraid of that. I’m not afraid of that. If you’re saying, “Hey, I need 1,000 or 1,200 against my 1,600 bucks,” I’m not as anti-debt as some people are when the arbitrage makes sense and you’re not going to do both.
[00:23:47] OG: The risk that you get into with debt is you borrow the money, then your lifestyle doesn’t account for that borrowing, and now you are increasing your lifestyle and borrowing co- You know what I mean? It’s like that snowball. HVAC system’s 8 grand. There’s probably a deal out there if you’re brand agnostic and you’re like, “I don’t, I don’t need a top-of-the-line carrier.”
[00:24:09] OG: I don’t even know. You know, but I can, I can do the deal with Trane and get 0% financing for 60 months. Yeah, do that. Why wouldn’t you? People do it with cars all the time. We have no problem doing it with cars. Plus there’s rebates in different areas, communities, utility company, federal government people have, uh, different rebates.
[00:24:29] OG: Or like in Texas, you never replace your roof. You just put a tarp on it and wait for the next hailstorm.
[00:24:34] Joe: That’s what my realtor told me when I bought my first house here. Mm-hmm. They said, “Never replace your roof.” Yeah. Never replace your roof.
[00:24:40] OG: The downside is I think they’re onto that because, um, uh, we did two roof replacements in 18 months when we first bought our house, and now our, uh, deductible is, uh, higher than the roof repla- replacement would be, so.
[00:24:52] Joe: Roughly a bazillion?
[00:24:53] OG: Yes. It’s rounded up, too.
[00:24:55] Joe: This is all I have for the half million person. I think the roof and the HVAC, though, are the only potential Achilles’ heel for the reason, though, that you, that you mentioned because big, these big lumpy expenses, OG, are the really… W- with, with half a million dollars and the potential for still 30, 35, 40 years of retirement, these big rocks are the only…
[00:25:19] Joe: Th- that’s, that’s the thing you gotta watch out for, I think, when you’re coming in a little hot. Let’s move to the 750 person. So same age, same general lifestyle, and if we think about the amount of money that they’re gonna bring in per month.
[00:25:34] OG: Like 2,500.
[00:25:35] Joe: 2,500-ish dollars. Same age, same general lifestyle, but a little plussed, right?
[00:25:43] Joe: They wanna spend a little more money. A lot of their basic expenses are not covered just by social security, OG. From the portfolio, they wanna spend just over 2,500. They wanna spend around 2,800 a month from the portfolio.
[00:26:00] OG: Okay
[00:26:01] Joe: Yeah. But I also think based on what you and I talked about around safe withdrawal rates, I think this is where I’d feel much more comfortable if you had a plan to reexamine your spending on a reasonable basis, you know?
[00:26:16] OG: Yeah. The more that you are spending that is discretionary, the more that you have the flexibility to make changes down the line. Look, I’m all for living life. You know what I mean? It’s like, I, I just don’t understand why people want to not do stuff or not experience things or not support or surround themselves with people that they wanna be around.
[00:26:38] OG: It just makes absolutely no sense to me. And then miser all their cash and, like, never do anything, and, you know, there’s a balancing act for sure, and there’s a trade-off. You know, there’s a client that I had, a long, a longtime client, he retired very early, you know, in his late 40s from a utility company, and, uh, his previous advisor had told him it was no problem to spend 10% of his portfolio ’cause that’s what the market was doing.
[00:27:02] OG: This was many, many, many years ago. You know, we coached him up and said, “Hey, this thing seems like a big number.” And he said, “I don’t care. You know, I’m just gonna live my life.” And he did for 20 years, and then he finally ran out of money. About age 70, 71, he ran out of money, and he said, “You know what? I’ll tell you something.
[00:27:21] OG: You would think that I would be mad that I ran out of money.” I’m not. He’s like, “I got a paid-for house, I got Social Security that pays my bills and puts food on the table, and I got to spend the last 20 years with my kids and grandkids every single day, hanging out with them, going to practices, going to games.
[00:27:39] OG: It was like a second chance at be– not second chance, but like a second time being a dad.” He’s like, “I got to be a dad for my kids, and then when they had kids, I got to be a dad all over again, and a granddad for 20 years, and now they’re grown, the grandkids are.” He goes, “I live in a great community, paid-for house, got a little dinghy.
[00:27:56] OG: Life is good.” You contrast that to, what if he would’ve worked until he was 65 like a, quote, “normal person.” He would’ve had millions of dollars, never experienced any of those things. Which life is better? I don’t know. Not for me to say. But, um-
[00:28:10] Joe: Well, not for me to say either, but I wonder as I’m listening to your story, like, is there, uh…
[00:28:15] Joe: You know, it doesn’t have to be either/or, right?
[00:28:18] OG: Well, yeah. And honestly, of course, along the way is like, you know, if we just take off the gas just a little, right? I’m not saying you have to go from all gas to all brake, but if we could just let it off just a s- just for a- Yeah … little bit. And the thing with retirement planning is e- especially if your lips are just barely above water, and maybe this scenario of 2,800 bucks a month is one of those scenarios where it’s like, you know, if everything goes according to plan, you know, if you retire Jan 1 of 2013, you’re good.
[00:28:48] OG: If you re- retire Jan 1 of 2007, probably not good. You know? Like, some of it’s just that luck factor. You’re just trying to, trying to work through that. But in both of those circumstances, if you get lucky, if that 750 can very quickly inch its way to, like, 1.2, and your spending stays at that 25, $2,800, you are so golden it’s insane.
[00:29:13] OG: Like, you’re done. Yes. Like, you don’t have to worry about withdrawal rates, safe withdrawal rates, anything. Yeah. You don’t have to worry about, like, what allocation I have in my portfolio, stocks or bonds or, like, what kind of risk can I take. Because you can absorb… You know, if your portfolio is 1.2 and you’re only taking out $2,500, you can absorb a 40% market decline before you get to that, quote-unquote, “safe withdrawal rate” of that portfolio.
[00:29:36] OG: So what does that mean? It means that you can be more aggressive with your investments, which then what happens generally, you go from that 1.2 to 2.5, you know, and now That compounding is working in your favor pretty quickly
[00:29:48] Joe: Now you’re talking about a whole different game plan.
[00:29:49] OG: Whole different thing. Yeah.
[00:29:50] OG: Yeah.
[00:29:51] Joe: For this discussion, let’s just keep him, the portfolio staying right around 750 throughout his early retirement years. Mm-hmm. You know, it’s funny because my next question to you was going to be expensive travel, but I think we already kinda answered that. This 750,000 person I think can do the expensive travel.
[00:30:08] Joe: I think they do it the, the… You mentioned Paul Merriman, the Paul Merriman way. Mm-hmm. Paul Merriman’s, uh, has said on this show that when times are great for the market, he takes the extra money, and he and his, uh, his lovely wife, they travel the world. And in years when the market went down, they traveled the Pacific Northwest where he lives.
[00:30:27] Joe: They went and they did, uh, a little bit more local stuff. Yeah. So I don’t think expensive travel’s out, even though they’re eating every dollar and a little bit more of what, you know, the, my conservative numbers
[00:30:40] OG: say they could. Yeah, but that expensive travel is part of that 2,800 bucks. It’s not $2,800 a month, and then I also need 20 grand to go to Europe.
[00:30:48] Joe: No, this is they want an additional 20
[00:30:51] OG: grand. But that’s… Oh. Eh.
[00:30:52] Joe: That’s, that’s the scenario
[00:30:54] OG: I’m
[00:30:54] Joe: talking about.
[00:30:55] OG: Maybe once. Maybe once. Yeah. Not in love with that idea.
[00:30:59] Joe: I think markets go up, I think you can handle that. You don’t think so? Do it the Merriman way?
[00:31:04] OG: No, because the, your $2,800 today is not $2,800 in 10 years from now.
[00:31:09] Joe: Oh, you’re still worried about inflation. Yeah.
[00:31:11] OG: I mean, is there anything else to be worried about? Like, that’s the only thing to be worried about with this.
[00:31:16] Joe: We’ve had no inflation lately. What are you talking about?
[00:31:18] OG: I’m looking at… My mom just texted me this, as a matter of fact. She has a long-term care policy, and she, uh, said, “Hey, what, what should I do with it?”
[00:31:25] OG: Basically, you know, guaranteed benefit, guaranteed premium.
[00:31:30] Anna: Eh,
[00:31:30] OG: except it’s not. Our bad, we did the math wrong. So her choices are reduce the benefit, reduce the time period, reduce the inflation rider, reduce the, you know, reduce, reduce, reduce, or accept a 15% premium increase.
[00:31:43] Anna: Mm-hmm.
[00:31:45] OG: Which one of these boxes do you wanna check?
[00:31:46] Joe: Mm.
[00:31:47] OG: That’s just the reality of life, you know? Milk costs more money today than it did 20 years ago.
[00:31:52] Joe: Yeah.
[00:31:53] OG: It just is. So you need a portfolio that’s gonna grow with that, and if you’re taking that growth in those good years, what are you gonna do when it’s not a good year? The purpose of the growth in the good years is to insulate you for the not so good years.
[00:32:06] OG: There we go. So if you’re always, like, right up against it, like I said, that person who retired in 2013 and has taken all the growth every year, they’re, they’re in the catbird seat except for the years when it goes down, then they get destroyed.
[00:32:19] Joe: Some great discussions around travel and bleeding every dollar.
[00:32:23] Joe: All right. Mm-hmm. Let’s go to a million dollars.
[00:32:25] OG: Woo-hoo. Party time.
[00:32:27] Joe: Yes, million dollars.
[00:32:28] OG: Finally made it.
[00:32:28] Joe: So the first two were 65 years old. The person with a million is 57.
[00:32:35] OG: Million bucks and 57. Uh, do we, do we know what our spending is?
[00:32:42] Joe: It’s coming, but your first thought?
[00:32:45] OG: What’s your spending? That’s my first thought.
[00:32:47] OG: My first thought is I need, I need more info.
[00:32:50] Joe: Well, and the reason I think you need more info is because, uh, you know, this time factor’s not insignificant. The thing I liked about 65 was the fact that they have that guaranteed income stream now and fewer years. But now we not only have let go of, for the first few years, that guaranteed income stream, but second, you know, we just cranked up the number of years that we also need this to cover.
[00:33:14] Joe: So no Social Security yet, no Medicare yet. Portfolio needs to fund almost, almost everything.
[00:33:22] OG: Yeah. Yeah, pretty concerning, um, those first 10 years. I mean, taking Social Security at 62 is such a penalty. If you’ve got some … You know, this changes if you’re a federal worker and you just retired at 57 or you were a lieutenant colonel and you just retired at 57.
[00:33:42] OG: That, that changes things quite a bit. If you … You know, and of course your spending. But if you’re, if you’re just, uh, John Q. Public and no guaranteed income and not gonna get any for probably the next 10 to 13 years, this requires some math. It’s, it’s not as clean cut as the other two.
[00:34:02] Joe: It is interesting that the million dollar scenario I gave you, and I did that on purpose obviously, the person with a million dollars- Yeah, don’t say,
[00:34:09] OG: Joe
[00:34:09] Joe: has the most fragile retirement of the three, which was my goal. The half million person has the most.
[00:34:17] OG: Yeah.
[00:34:17] Joe: We definitely don’t wanna start with 500, 750 or a million. You can see how the goal changes everything, stackers. When you wanna retire becomes super important. What is the gap that you’re trying to fill, and what penalties are you willing to take?
[00:34:31] Joe: Are you gonna take the penalty so that you can get Social Security early at 62? Lots of things to consider. Glad we were able to dive into those, OG. I would love to get your thoughts, stackers, on retiring at these three numbers, 500, 750 and a million dollars. Join our Facebook group, The Basement, stackingbenjamins.com/basement, and that gets you in the club where we talk about a lot of the things that happen on the show.
[00:34:58] Joe: We’d love to have you join us, along with the 201, which is our newsletter where we dive even more into, uh, h- into this topic. I’m sure Kevin Bailey, who writes our 201 newsletter, is gonna have a lot of fun. Of course, if you don’t get the 201 newsletter, that’s stackingbenjamins.com/201. Coming up, OG is gonna be back.
[00:35:17] Joe: I get to give my vocal cords a little rest here. It’s gonna be OG and Anna and their financial basics. But first, Doug coming back down the stairs, man. It’s about time. What’s on tap for today’s trivia?
[00:35:33] Doug: Hey there, stackers. I’m Joe’s mom’s neighbor, Doug, and just imagine this podcast as a TV show. I mean, three friends chat about current topics around a card table in their mom’s basement. Sounds like one of those old ’80s sitcoms, doesn’t it? Well, one show that was not a sitcom was stacking some Benjamins quickly in the mid-1980s.
[00:35:53] Doug: It was called Miami Vice. Pastel clothes, loafers without socks, Ferraris, synth-heavy music, Don Johnson and Philip Michael Thomas everywhere. That sounds just like Stacking Benjamins, doesn’t it? I mean, that was practically us last Monday. Well, seeing a good thing a year later, producers created a sitcom they initially wanted to call Miami Nice, about four older single women sharing a house in Miami.
[00:36:22] Doug: It starred Bea Arthur, Betty White, Rue McClanahan, and Estelle Getty, and ran from 1985 to 1992, becoming a huge hit for its sharp comedy about friendship, dating, aging, family, and an impressive amount of cheesecake. What name was ultimately given to this Benjamin-stacking hit series originally called Miami Nice?
[00:36:54] Doug: Hey there, Stackers. I’m synth music lover… Seriously, I’m not, but it fits the script, so let’s just go with it, and man who’s a huge fan of all things Miami, and by that, I mean Cuban sandwiches, Joe’s mom’s neighbor, Doug. A show originally called Miami Nice definitely was playing on the Miami Vice brand while being an entirely different type of show.
[00:37:16] Doug: That’s why, ultimately, NBC trashed that title and went with another for the long-running series starring Bea Arthur, Betty White, Rue McClanahan, and Estelle Getty. What was the name? Of course, if you’ve ever watched any reruns on TV, and I mean any reruns, you’ve seen this one. Of course, it was The Golden Girls.
[00:37:36] Doug: And now speaking of gold, how about this week’s basic segment with Anna and OG?
[00:37:43] OG: Okay, Anna, season three, episode two, we’re gonna talk about Social Security, and specifically around framing this decision, uh, for people that are thinking about retiring early. Because if you’re, you know, looking at some numbers, and you’re doing some calculations, and you’re downloading some stuff from Social Security in your retirement plan and stuff like that, there’s some, some things- Mm-hmm
[00:38:05] OG: that you may need to be aware of if you’re gonna pull the trigger a little earlier than, uh, than normal, right?
[00:38:12] Anna: Absolutely. If you’re just retiring on time, get that statement, look at that statement. If you’re retiring early, we got some things we gotta talk about.
[00:38:21] OG: We got some ‘splaining to do.
[00:38:22] Anna: Mm-hmm.
[00:38:23] OG: All right, so a couple of quick things.
[00:38:25] OG: Uh, let’s talk about two bullet points around Social Security that maybe not everybody knows. Talk a little bit about the 35-year rule. What is 35-year rule? What does that mean?
[00:38:36] Anna: This is just basically how Social Security is calculated. They are gonna be using the highest earning years. Like, let’s say you worked for 40 years, they’re gonna use the 35 highest earning years of those 40 years.
[00:38:51] OG: And this could include even your 11-year-old paper route, for example.
[00:38:56] Anna: Mm-hmm. Your snack stand at the country club at the pool, like myself.
[00:39:01] OG: Like you. What happens if you are going to retire and you don’t have 35 years?
[00:39:07] Anna: Then they’re gonna fill that in with a nice big zero.
[00:39:10] OG: Donut. Mm-hmm. A donut goes in there.
[00:39:13] OG: So as you’re thinking about your retirement planning, as you’re thinking about your Social Security planning, if you don’t have 35 years, or if you have 35 years, but like, you know, f- 10 of them are from when you were 13 to-
[00:39:24] Anna: Yeah, $2,000 …
[00:39:25] OG: 20, and you’re making- Mm-hmm … Snack Shack money, that’s gonna be factored.
[00:39:28] OG: But there is some adjustment that they make, right?
[00:39:31] Anna: Yeah. So what they’re gonna do is when, when you download the statement, you’re gonna see the dollars for what you actually did earn that year, which is really fun. But when they’re doing the calculation, they are actually going to do an inflation adjustment to each of those years so that it is as if you had retired at 65, or as if the numbers were from the year you’re gonna turn 65.
[00:39:51] Anna: Is that correct?
[00:39:52] OG: Well, it’s 60, yeah. Sixty, okay. So they wage index you until 60, and then from your earnings from 60 till your full retirement age is your actual, actual dollars- Mm-hmm … uh, is what they calculate there. So yeah, when you see the two grand of Snack Shack money, it’s not gonna be counted as two.
[00:40:06] OG: It might be counted as three or four, but it’s still not some magically, uh-
[00:40:11] Anna: It’s just inflation …
[00:40:12] OG: increased number. Yeah. So this really matters as you’re thinking about this early retirement thing. So, uh, we just had somebody that retired. They were 50 years old and worked kind of a normal after-college job.
[00:40:25] OG: But what’s the calculation difference, or what do we have to consider if you’re kind of on this fire path and you’re gonna… And really, and I think 50 is a pretty early retirement. So what would you have to be aware of? And by the way, you said something earlier. You said download your statement. If you haven’t done this, ssa.gov, create a login.
[00:40:45] OG: It’s id.me. You have to go through the whole thing. But once you do that, you should download your Social Security statement annually, right? Mm-hmm. Just to make sure. So ssa.gov if you haven’t done that. Okay. So 50 years old, you’re gonna retire. What does that person have to be aware of when they’re looking at their statement, when they’re starting to think about retirement?
[00:41:03] OG: What do you have to know that maybe you’re not being told when you look at that statement?
[00:41:07] Anna: Yeah. So let’s say you’re 49, and you’re looking at it, and you’re about to retire next year. They’re gonna look at, when doing the calculation from that statement, as if you were to work and continue to work from 50 to full retirement age.
[00:41:22] Anna: They’re gonna base their calculations off of your current income level. So even if you’re deciding, “Hey, I’m gonna pull back, and I’m gonna do part-time,” or, “I’m gonna work at a coffee shop. I’m gonna do this, like, coast fire thing too,” this also is gonna play into it ’cause they’re assuming that you are working at the same level that you currently.
[00:41:41] Anna: So if you’re maxing out Social Security, they’re assuming you’re gonna max it out, and you’re gonna continue to do that until full retirement age. If it’s lowered in some way, you need to do the calculation yourself on that.
[00:41:52] OG: Yeah. And to kind of give some context here, we did the math on this just so that people know.
[00:41:57] OG: So let’s assume that you started working at 22, right? You graduated college. You, you kind of earned maybe half Social Security wage max from 22. It just kind of- Mm-hmm … ramped up until you got to 40, so that kind of 18-year track. And then from 40 to 50, you made the Social Security max, which Social Security max this year, what we mean by that is how much do you get credit for?
[00:42:20] OG: What’s the maximum you can get credit for for Social Security? It’s 176,000 this year and some change. That’s… If you make above that, then you don’t pay Social Security taxes. Mm-hmm. Your employer does, but- You max out … you don’t. You’re, you’re, you’re maxed out. So we calculated that person, 22 to 50, kind of ramped up to 40, and then from 40 to 50 was at the max, versus the number that’s on their statement when they’re 50 versus what they will really get at 67 is almost a 20% reduction.
[00:42:49] OG: Mm-hmm. So not zero. You know, that’s, that’s a, that’s a pretty profound change if you’re looking at your Social Security statement going, “Oh, I’m gonna get, like, 3,500 bucks. Great.” It’s like, well, maybe it’s more like, you know, $2,800.
[00:43:03] Anna: Mm-hmm.
[00:43:04] OG: So be aware of that. And this also affects spousal benefits, yeah?
[00:43:09] Anna: Yes.
[00:43:10] Anna: That’s a good point. So if your spouse did not have earned income or it’s just significantly less than yours, they might, whether we’re talking about early retirement or not, they might qualify to tap into spousal benefits, which is 50% of your Social Security. In that case, you also need to consider this for them when y- if you’re gonna retire early, your benefit is reduced by 20%.
[00:43:36] Anna: We have to use that reduced benefit to then calculate their benefit.
[00:43:41] OG: They’re re- So their reduced … you know, they’re gonna be reduced as well. Yeah. So if you were gonna get 3,500 bucks, now you’re gonna get 2,800. Your spouse was gonna get 1,700 but is now getting 1,400.
[00:43:51] Anna: Mm-hmm.
[00:43:52] OG: So, you know, this is a $12,000 a year change all in- Yeah
[00:43:56] OG: you know, based on retiring at 50. Not saying you shouldn’t do that, but I think it’s important to recognize that that’s a calculated difference. Spousal benefits are reduced or could be reduced. Your benefit will be reduced because of this. There’s another reduction that can happen, and that is if all of these calculations are based on full retirement age, which full retirement age today- Mm-hmm
[00:44:19] OG: is for most people age 67. I think there’s maybe some lingering folks out there that are in the 66s, but you know, for all intents and purposes we’ll say 67. But you can claim Social Security as early as-
[00:44:31] Anna: 62 …
[00:44:32] OG: 62, and as late as-
[00:44:34] Anna: 70 …
[00:44:35] OG: 70. So you know, you’ve got some wide range of decisions there along the way of when you’re gonna do that.
[00:44:43] OG: And, and if you take it before 67 Then there’s a reduction, right? Mm-hmm. So, you know, you’re 50, you’ve got a reduction coming because, you know, just the calculation’s gonna be, oh, some zeros in there or some low numbers. And then on top of that, if you decide to take it at 62 or 63 or 65, there’s another reduction that basically hits you on top of that.
[00:45:06] OG: So to kind of give you an idea here, just penciling this out, if you’re looking at the number for age 67, your full retirement benefit, which is what’s presented on your Social Security statement, it’ll also show you the 62 number, which is roughly 75-ish percent of that full number. You can also wait till 70, which is roughly about 120% of the age 67 number.
[00:45:29] OG: So you get a, you get a benefit, a bonus by waiting. You get a huge reduction by getting it early, but then there’s the trade. Well, how long are you gonna live?
[00:45:39] Anna: Yeah. If
[00:45:39] OG: we all knew that calculation.
[00:45:40] Anna: Just let me know in an email- Yeah … when you’re gonna die, and I can tell you when to take it.
[00:45:44] OG: And the spousal benefits are, are compounded on top of that- Mm-hmm
[00:45:48] OG: for survivor benefits. So this is not a, a decision to be made in a vacuum. And one thing about Social Security, just to kind of give everybody a heads-up here, you get one oopsie. Can I say… Is that, is that the right phrase? Oopsie daisy. An oopsie. An oopsie daisy. Mm-hmm. You get one oopsie daisy- That’s right
[00:46:06] OG: where if you file for Social Security, you can say, “I change my mind”- Pay back everything you got. So, you know, you gotta have the liquid- you couldn’t have spent the money. Mm-hmm. You needed to save it or have a way to pay it back. Pay back all the money within the 12 months from your filing date, and just say, “I actually, I’m gonna change my mind.
[00:46:26] OG: I’m gonna do it later.” After 12 months, you’re locked into whatever decision you made. So this is a really important decision, you know, that you have to make at 62 through, through 70. Somewhere in there you’re gonna affirmatively elect Social Security, and how that affects your spouse or spousal benefit, how it affects your survivor benefit, and now dovetailing into your early retirement decision.
[00:46:48] OG: But there is some nice news here. So we talked about age 50 being, you know, a 17 to 20% reduction hypothetically. At 55, it’s not as bad.
[00:47:00] Anna: No. Yeah, your reduction I think would be maybe close to, like, 5%-
[00:47:05] OG: Yeah …
[00:47:06] Anna: in benefit.
[00:47:06] OG: Yeah, because you’ve packed a few more years in there.
[00:47:09] Anna: Mm-hmm.
[00:47:09] OG: You know, at those higher
[00:47:10] Anna: things.
[00:47:10] Anna: Especially at your h- yeah, especially because it’s your- Yeah … higher earnings, so they’re not as likely to tap into the paper route time period- Yeah … and earning years, like- The paper route
[00:47:18] OG: earnings.
[00:47:18] Anna: Yeah. There’s less zeros, so, um, that’s a huge benefit to working those couple of years.
[00:47:26] OG: It’s interesting because wh- when we talk to people who have pensions, it seems like that’s a number that they have in their mind, right?
[00:47:32] OG: Like, “I gotta get to 29. I, you know, I’m at 29 years. I can’t retire today. I gotta get my 30, ’cause I get a big increase by waiting till 30.” Or, you know, “I gotta have this magic formula that, you know- Mm-hmm … it’s my highest three, so I gotta get that extra year of the highest three,” you know? We just had a conversation yesterday with somebody that said, “Hey, I, you know, I’d love to retire in 2028.
[00:47:52] OG: I can’t. I gotta wait till 2029 because I need that extra high year for my pension.” I feel like that’s not really a discussion that we have a lot of with Social Security because it’s just like, well, it’s this nebulous thing. I think it’s a really important piece when it comes to, you know, your early retirement planning of, hey, am I gonna retire 53 or 55?
[00:48:13] OG: Well, this is gonna affect the Social Security plan as well, just like it would affect your pension. So put this in the decision matrix, I think, along the way. Any other kind of tidbits of info on Social Security, Anna, that you think people should know?
[00:48:28] Anna: I think what everyone should be doing, if you haven’t already, is grab your statement from ssa.gov.
[00:48:34] Anna: Make sure that you create an account, get those updated statements. They’ll email them out to you. Take a look at that and make an estimate based off of what you picture for your retirement timeline, how that’s going to impact those numbers, and how that’s gonna impact your plan. Were you basing it off of that larger number, and now we need to pull it back, and does 50 or whatever the number still make sense for you?
[00:48:58] Anna: Do that. See how it affects spousal benefits.
[00:49:01] OG: Yeah. This is a great tool, by the way. Ssa.gov’s got a lot of resources. You can also screen grab some of this information. This is a great use of AI Mm-hmm … ’cause it’s gonna be able to do math for you, and say, “Hey, here’s my earnings history.” You know, just screenshot it so it doesn’t have your social and all that sort of stuff.
[00:49:18] OG: Be aware of, uh, security. But screen grab that, put it into Chat or Claude or whatever your tool is, and say, “Hey, if I’m gonna work for the next five years, how does this affect my Social Security? If I’m not gonna work for the next five years, what do I gotta be aware of?” It’s gonna give you some real easy calculations there to kind of model out, you know, if you’re DIYing this at home.
[00:49:38] OG: And if you’re not DIYing it and you’re working with somebody, make sure you’re calculating this as part of the deal, okay?
[00:49:43] Anna: Mm-hmm.
[00:49:44] OG: That’s gonna wrap it up for Social Security stuff. I mean, we could talk for hours on this. We talk about Medicare, long-term care stuff. That’s coming up on the horizon here as well.
[00:49:53] OG: If you got questions or you think of something here that you wish we would’ve talked about, you can just email me, og@stackingbenjamins.com. Uh, if you wanna talk to us about your plan, uh, stackingbenjamins.com/og. So dealer’s choice on how you reach out.
[00:50:07] bumper: Hey, I’m Rob Berger. When I’m not rolling in the dough, that’s right, I’m stacking Benjamins.
[00:50:14] Joe: Let’s wander out here on the back porch for just a second, OG, because we have had some great letters from our Stacker community. James wrote to me and said, “Greetings, Joe. I listened to the podcast a few days ago about teaching children about money,” and this was our special Friday Roundtable episode, 1887.
[00:50:34] Joe: James said, “I know you had some experts on the subject. After I listened, I didn’t recall hearing anything mentioned about giving to charity, to church, to help others.” I’d say that was an oversight. And you know what’s funny, James, is that I laid out that entire discussion, and 100% you are right, that was an oversight, so I love your note ’cause I think there are some great lessons to teach there.
[00:50:57] Joe: He said, “As a young boy, my mother would give me an allowance, and every time we’d take out a portion for savings, another portion to give to the church. It was a long time ago, so these amounts were measured out nickels or even pennies, but the lesson was there and it’s very scalable. Just thought I’d give you something to think about.
[00:51:14] Joe: Best regards to you and your SB gang.” Well, not only am I thinking about it, Jim, I wanted to bring it to the podcast. I think that’s a great thing for kids to learn early. OG? Yeah. We,
[00:51:24] OG: um… See, I subscribe to the theory that you should get used to saving money. I just believe that when you’re a kid or when you’re 20 years old, or probably even when you’re 30 years old frankly, you probably don’t know exactly what you want to support yet.
[00:51:41] OG: You haven’t maybe found the exact thing that is the most impactful for you or your family. While I think it’s noble to, you know, have 50 bucks a week come out of your paycheck and go to United Way, no offense, but I don’t think they’re gonna miss it. I would much rather save and invest that money until I find the thing that really gets me excited, and then be able to do something meaningful that moves the needle for whatever group it is.
[00:52:07] OG: So I wanna really focus on, you know, one specific thing or two specific things in depth with all the resources that I have. I tell my kids that they need to save and invest money with the idea being keep your eyes open for the things that excite you, but I’m not super passionate about like having them say like, “Oh, well, I’m gonna put $25, you know, from my paycheck into this generic charity fund” they don’t particularly care about ’cause they’re 17 years old.
[00:52:38] OG: But I think the habit of saving money and the habit of putting that aside is a good idea But we also do other things, like around the holiday time and stuff like that, we really kinda get engaged in our community, and that’s where they see a lot more action than the 25 buck thing.
[00:52:56] Joe: With the boots on the ground.
[00:52:57] OG: Yeah.
[00:52:57] Joe: Getting your hands dirty.
[00:52:58] OG: Yeah, a lot of that. Yep. Around the holiday,
[00:53:00] Joe: yeah. Reminds me of when, uh, Chris Field was on the show, uh, the giving expert, talking about how giving 100 bucks is great, but you know what? If you’re somebody who’s great at social media, doing some social media on behalf of your favorite local charity goes a world further.
[00:53:15] Joe: Like if- Yeah … you give them way more than a couple hundred bucks in terms of, uh, your expertise. Well,
[00:53:20] OG: and $100, I think, you know, using that $100 example, when you go out for breakfast in December and you can tell that that server is on their about 700th table, you know, of, of pancakes at the IHOP and, and is showing the wear of 700 pancake deliveries at 10:45 in the morning on a Saturday, that person probably benefits from that $100 way more than a generic 501[c][3].
[00:53:48] OG: You know what I mean?
[00:53:49] Joe: Yeah.
[00:53:50] OG: To me, that’s more meaningful than, more impactful and gets, and does the work in my community more than, you know, a generic-
[00:53:59] Joe: Yeah …
[00:53:59] OG: online contribution to Red Cross. No offense to the Red Cross. Yeah.
[00:54:02] Joe: I like, James, uh, to church, to help others. Good stuff. We did not even bring this up at all.
[00:54:08] Joe: James, thanks for the note, and if, uh, you’ve got a note for the show, just send it to me, joe@stackingbenjamins.com. All right, that’s gonna do it for today. Big thanks to all of you for hanging out. Today, we talked about retiring on three different amounts of money and about how you really wanna think about that.
[00:54:23] Joe: I hope we were able to open your eyes on the approach that is far superior to just thinking, “I’ve got X amount of money. Can I retire?” A lot of questions to ask first, but you can see that when you begin with that end in mind and work backwards, things get a heck of a lot better for you and your retirement.
[00:54:42] Joe: Speaking of retirement, Linda Gratton is a retirement and longevity expert, OG. She’s a psychologist, and there’s a lot of psychology at play when we start thinking about the fact that you might live to be 130- … maybe 140 years old, and retiring. Think about somebody that says- Which
[00:55:01] OG: means I need to start saving around age 100.
[00:55:03] OG: Until then, spend, spend, spend.
[00:55:05] Joe: Right? Think about somebody who’s gonna retire at 55 or 50. What are you gonna do from then to 140? Uh, Linda thinks we need to blow up the way we think about our life and, uh, reexamine it. We’re gonna talk about a new way to look at retirement and how to live a 100-year lifestyle, she calls it, on Wednesday’s show.
[00:55:25] Joe: Can’t wait to say hi to Linda, but for now, let’s say hi to Doug. Doug, what should we have learned from today’s show?
[00:55:31] Doug: Well, Joe, first, take some advice from our headline: $500,000 for retirement? You can make it work. Everything is possible depending on your lifestyle, feelings about bringing in some income from time to time, and how you manage your portfolio.
[00:55:45] Doug: Second, did you write down Anna and OG’s lesson for today? What are you doing? Get started. Come on. But the big lesson, never, ever, ever call Joe’s mom a golden girl. She’ll say, “Thank you for being a friend,” and then punch you in the face harder than one of Bea Arthur’s one-liners. She was so salty This show is the property of SP Podcast, LLC, copyright 2026, and is created by Joe Saul-Sehy.
[00:56:17] Doug: You’ll find out about our awesome team at stackingbenjamins.com, along with the show notes and how you can find us on YouTube and all the usual social media spots. Come say hello. And oh yeah, before I go, not only should you not take advice from these nerds, don’t take advice from people you don’t know.
[00:56:36] Doug: This show is for entertainment purposes only. Before making any financial decisions, speak with a real financial advisor. I’m Joe’s mom’s neighbor, Doug, and we’ll see you next time back here at the Stacking Benjamins show
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