A general principle in financial planning is that if nobody would be financially in trouble if you were to die tomorrow, you don’t need life insurance. The most common example of this principle is that an unmarried person with no children probably does not need life insurance. A less discussed but still very common application of this principle is that, after you have retired (or reached financial independence), you probably do not need life insurance anymore. (I say “probably” because one noteworthy exception is that if you have a pension/annuity with a small (or no) survivor benefit, you mig ..read more

For several years now, it has been impossible to purchase inflation-adjusted lifetime annuities (other than by delaying Social Security). For investors taking a “safety-first” approach to retirement planning, this leaves only TIPS and I Bonds as the tools available. While TIPS and I Bonds are indeed useful tools, they don’t offer the risk pooling that lifetime annuities do (i.e., lifetime annuities stop paying income when the annuitant dies, and because of this they can provide a higher amount of income than products without risk pooling of this nature). A new product, however, offers longevit ..read more

Today I want to share with you a brief “estate planning gone wrong” story. The story is real, but of course the names have been changed. If you are not up-to-speed on basic trust terminology, please read “What’s the Point of a Trust?” first. Here’s the basic sequence of events: Hank and Wanda (a married couple) had their attorney, Adam, create a trust for them. Hank was named as trustee of the trust. Adam was named as successor trustee. Hank and Wanda were co-beneficiaries of the trust, with their adult children named as secondary beneficiaries. Hank and Wanda moved essentially all of their a ..read more

I’ve written before about how I consider retirement spending strategies to exist on a spectrum. Strategies at one end of the spectrum (e.g., the classic “4% rule” approach) do not adjust spending based on portfolio performance. This makes spending predictable, but the tradeoff is that it results in both a higher probability of portfolio depletion as well as a higher probability of having a huge unspent sum at death. In other words, by not adjusting spending based on portfolio performance, you have a greater likelihood of ultimately overspending or underspending. And at the other end of the sp ..read more

In my prior roundup article, I referenced a few different types of scams that you’re likely to encounter. In reply, multiple readers recommended the following recent episode of Last Week Tonight with John Oliver. It’s an excellent explanation of another common and clever type of scam that you and your loved ones should be aware of. Pig Butchering Scams: Last Week Tonight with John Oliver Other Recommended Reading 9 Lessons I’ve Learned About Death and Money from Elliott Appel Why Financial Literacy Education in the US Sucks from Marie Cascione (short video) Noisy Factors from Pat Akey, Adri ..read more

Hopefully by now, everybody is familiar with basic online safety measures (e.g., even if you have a Bank of America account, don’t click the link in the email from Bank of America — instead directly visit the website and navigate to what you need). But the tools and techniques used by scammers keep improving, as we can see in the articles below: Calendar Meeting Links Used to Spread Mac Malware from Brian Krebs Finance Worker Pays Out $25 Million After Video Call with Deepfaked CFO from Heather Chen and Kathleen Magramo A Real-Life Pump and Dump Scam Experience from Jim Dahle Other Recommend ..read more

A reader writes in, asking: “I’m not sure if you would consider a blog post or similar regarding cash (CD’s, Short Term Treasuries, Money Market, etc) but after reading and following your portfolio recommendations I’m curious if you have opinions on cash and how much to keep at any given time. I recognize all situations are different but you’ve always done a good job of laying out the options. My specific situation is: recently retired but my wife is working for another 2 years at which point we will both be retired.” Firstly, I’m going to assume for the sake of this article that you already ..read more

Due to the SECURE Act 2.0 owners of 529 plans can roll a limited amount of of the 529 money into a Roth IRA. As Allan Roth explains in a recent article, there are several rules to follow, some administrative challenges, as well as a bit of remaining ambiguity in the law. The Law and Strategies to Convert a College 529 to a Roth from Allan Roth Other Recommended Reading Practical Considerations in Tax-Efficient Distribution Planning from Wade Pfau, Joe Elsasser, and Steven Jarvis Is the U.S. Stock Market Too Concentrated? from Ben Carlson Evidence to the Contrary of Limiting Beliefs from Kat ..read more

Based on reader feedback, the recent “How to Research a Tax Question” article was super popular. A handful of people suggested doing the same thing, but with Social Security. So, what follows are my tips for researching a Social Security question. With tax questions, the three broad categories of authoritative sources are the law (Internal Revenue Code), Treasury regulations (as well as revenue rulings), and court cases. Similarly, for Social Security, we have the law (Social Security Act), regulations, and court cases. But I will tell you that in ~13 years of dealing regularly with Social Sec ..read more

Last week, Rob Berger interviewed me for his popular Financial Freedom show. We discussed a range of Social Security topics: basic rules, benefit calculations, terminology, planning considerations, and the Open Social Security tool. I hope you enjoy it. Rob Berger Interviews Mike Piper about Social Security (and Open Social Security) Other Recommended Reading Is Underspending a Fiduciary Problem? from Michael Finke The Best US Economy Since the 1990s from Ben Carlson Busting Up the Home Sales Cartel Is Overdue and Necessary from Bloomberg News Identity Economics from Katie Gatti Tassin My F ..read more