All About That Process

The future isn’t going to happen as you (or your financial advisor) assume, and your spending goals and actual spending are likely to change over time. Therefore, as previously discussed in our posts of April 16, 2023 and October 24, 2023, your retirement plan should include how you will determine when future adjustments to your plan may be necessary. We believe it is important for a good retirement plan to implement a robust process for making necessary future adjustments, and this process is likely to be even more important than the projection tool, or metric, used to measure the financial status of your plan.

Planning Tip--How Will My Funded Status Be Affected?

As discussed in previous posts, your Funded Status is an easily calculated, robust metric used to measure your financial health in retirement. Measuring and monitoring your Funded Status annually can help you make countless financial decisions. In this post, we encourage you to think about how your Funded Status will be affected before making a significant financial decision.

Retirement Researcher Discusses why He Prefers Funded Ratio to Monte Carlo Modeling

As discussed in our post of February 21, 2025, pre-eminent retirement researcher Dr. Wade Pfau has become an actuarial approach convert. You can hear Dr. Pfau and Alex Murguia discuss why they prefer using the Funded Ratio [Status] to Monte Carlo modeling for retirement planning in Episode 168 of their podcast series.

Better Financial Management in Retirement Through Better Metrics

In several of our recent posts, we have been touting the Actuarial Approach and its use of the Funded Status metric to measure household financial health. This is another one of those posts.

Support Grows for Using “Funded Status” Rather Than “Probability of Success” as the Key Metric for Measuring Financial Health in Retirement

This post is a follow-up to our post of February 13, 2025, How to Improve Decumulation Planning. Subsequent to that post, we received our copy of Retirement Planning Guidebook, by the preeminent retirement researcher, Dr. Wade Pfau.

Social Security Financing—When You’re in a Hole, Stop Digging Part 2

This is a follow-up to our post of October 14, 2024.  In this follow-up post, we will estimate Social Security’s January 1, 2025 Funded Status based on 2024 valuation results and once again point out that now is probably a good time for our congressional representatives to be looking at ways to increase system revenues and/or decrease system benefits to improve the system’s Funded Status rather than looking at ways to increase system benefits and/or decrease system revenues.

How to Improve Decumulation Planning

We have never been big fans of Monte Carlo models for determining how much one can afford to spend in retirement from year to year. As actuaries, we believe that following the simple “3M” process described below is much more import than the model used in the process.

Actuarial Financial Planner FAQs

The Actuarial Financial Planner (AFP) workbooks (for single retirees and retired couples) are robust actuarial models integral to each of the three “M” steps outlined below in our recommended process for keeping your spending on track and consistent with your spending goals in retirement:

Actuarial Approach--Three Key Planning Steps

• Measure your Funded Status (Assets/Liabilities) at the beginning of each year
• Monitor your Funded Status from year to year, and
• Manage your spending, assets and risks in retirement as necessary 

We have received questions about the AFPs over the years. In this post we will once again attempt to briefly answer five of the most frequently asked questions.

Would Enacting the Hoyer/Primus Proposal “Fix” Social Security?

In early January, Social Security’s retiring Chief Actuary, Steve Goss, released an actuarial valuation of a proposal intended to improve the solvency of the Social Security trust funds based on 2024 valuation results and intermediate assumptions. The request for the proposal valuation was submitted by Rep. Steny Hoyer (D-MD) and economist Dr. Wendell Primus, and therefore is referred to in this post as the Hoyer/Primus proposal. The proposal includes a total of 17 provisions that would affect the system’s finances. Some of the more significant proposal provisions would increase system revenues while other significant proposal provisions would generally decrease system benefits.

This post will not analyze or comment on (with one exception) any of the specific proposed changes. Nor will we provide our thoughts on the likelihood of this proposal passing in the near future (unlikely). Instead, we will simply discuss whether enactment of the Hoyer/Primus proposal would fix the system. In brief, while the proposal would definitely improve Social Security’s solvency, it should not be considered as a “fix” for 75 years or any specific period.

How Much Can You Afford to Spend, Not Withdraw, in Retirement?

Since our very first post in 2010, our focus has been on helping households determine how much they can afford to spend each year in retirement (hence the title of our website). By contrast, the focus of most retirement experts has been, and continues to be, how much of your portfolio can you afford to withdraw each year in retirement. If you are looking for a Strategic Withdrawal Plan (SWP) that purports to be the best way to “tap” your retirement savings, you’ve come to the wrong website.