BiggerPockets Money Podcast

Episode: The Secret to Retiring Early AND Spending More Money

Date: August 29, 2025

Host(s): Mindy Jensen (A), Scott Trench (B)

Guest: Aubrey Williams (C), Financial Planner & FI Community Expert

Overview

This episode dives deep into breaking the myth that retirees must choose between retiring early and enjoying life, or retiring later and spending more. Guest Aubrey Williams reveals how building flexible, risk-based spending “guardrails” can not only help people retire sooner, but actually spend more confidently throughout retirement. The conversation upends the conventional “4% rule” mindset, explores the psychology of spending after decades of saving, and offers accessible tools and actionable planning strategies to optimize both your enjoyment and financial security.

Main Discussion Points & Insights

1. The Myth of the Smooth Retirement Path

• Traditional Planning vs. Reality:
  The familiar 4% rule assumes a fixed, unchanging portfolio withdrawal. But in practice, life’s path is turbulent — market ups and downs, unexpected events, etc. Flexibility is key to success.
  • Aubrey: “If you take a look at this picture, the top one is your plan. 4% forever. But what actually happens?... There’s a rock slide and a bomb and you have to row across the lake and jump over the hurdle and there’s a rainstorm climbing the slippery ladder, but you make it.” (03:02)

2. Everyone Adjusts: Human Nature in Financial Independence

• Real-World Behavior:
  Most people instinctively adjust spending up or down when market conditions change, even if their plan is ‘fixed.’
  • Aubrey: “People adjust. The 4% rule was not intended to be a drawdown strategy... but it is not a drawdown strategy.” (04:32)
• The Unknown is Scarier:
  The lack of “decumulation” stories makes spending scary — it’s just less familiar, not inherently more difficult.

3. The Psychology of Spending After Saving

• Underspending as a Real Risk:
  Many FI (Financial Independence) achievers struggle to spend after a lifetime of extreme saving, often working longer than needed or enjoying less.
  • Aubrey: “If you’re not spending your money, then it’s going to go to, as Kevin Sebesta says, the hogs, which are heirs, organization or government.” (07:54)
• Check-ins and Control:
  Regular monitoring provides plenty of warning — retirees rarely “suddenly” run out of money.
  • Mindy: “It’s not like you have $1 million today and then all of a sudden tomorrow it’s zero... you’re going to have a huge heads up before you actually run out of money.” (29:24)

4. Guardrails: The Secret to Spending More

• Risk-Based Guardrails Defined:
  Instead of inflexible rules, set “guardrails” (upper and lower bands) — if your portfolio grows, increase withdrawals; if it falls far enough, trim spending. Most years, no change is needed.
  • Aubrey explains: By using tools like FireCalc or Projection Lab, “we can do this risk based guardrail strategy based on historical analysis... have numbers set in advance. I’m going to adjust this much when my portfolio goes to this value. And that’s really different than just be flexible.” (13:40)

Example (See: 33:00–37:00)

• $1M portfolio, guardrails set at +10%/-46%.

• You increase spending if portfolio rises above $1.095M, cut spending if it falls to $524K.

• Result: Can spend ~10% more per month than a rigid 4% rule allows, with minimal risk.

• Aubrey: “The difference... your withdrawal rate is 4.39%, so an extra 0.4%. That means $3,660 a month in the adjusting plan versus $3,315.” (37:00)

5. Testing the Worst-Case Scenarios

• History-Proven:
  Modeling the Great Depression and stagflation, the guardrails approach survives—even thrives. The few times money runs out, it’s after three decades, or spending can be easily adjusted before that happens.
  • Aubrey: “We’re going to see how it drives. That’s the phrase I like to use. I’m going to show you what would happen if you ran this through the Great Depression, stagflation, 2008…” (37:05)

6. Changing the Language: From “Success” to “Underspending”

• Mental Shift Needed:
  Framing retirement as “100% chance of success” means a 100% chance you’ll leave a large, unspent pile of money, possibly at the cost of enjoyment.
  • Aubrey: “The other thing it means is that you have a 100% chance of underspending.” (45:54)

7. Optimizing Asset Allocation: The “Glide Path”

• Equity Glide Path / Bond Tent:
  As FI approaches, gradually shift to a more conservative (e.g., 60/40) allocation, then slowly increase equity after retiring to ensure growth and reduce market-sequence risk.
  • Aubrey: “When you’re three to five years away, you start moving towards bonds... then after that... over the next 5, 8, 10 years you increase that equity share.” (21:30)

Notable Quotes & Memorable Moments

• “The 4% rule was not intended to be a drawdown strategy. It’s an academic answer to an academic question.”
  — Aubrey Williams, (04:32)

• “If you’re not spending your money, then it’s going to go to... heirs, organization or government. If that’s what you want, that’s great. But in the meantime, you could be giving with a warm hand... or doing something yourself.”
  — Aubrey Williams, (07:52)

• “We’re too busy reaching FI to be FI.”
  — Aubrey Williams, (27:48)

• “People who got to financial independence will practice checking in on their finances, and won’t suddenly run out of money. You’re going to have a huge heads up before you actually run out.”
  — Mindy Jensen, (29:24)

• “If you’re willing to make a small adjustment downward when the market is good, you can make adjustments upward and get more area under the curve and more lifetime spending…”
  — Aubrey Williams, (16:43)

Timestamps of Key Segments

• Intro & Aubrey’s Adjustment Philosophy: 00:00–06:13
• FI Mindset and Real-Life Spending Behavior: 06:14–11:28
• Psychological Barriers to Spending, Tools, and Guardrails: 11:29–18:15
• Asset Allocation/Glide Path Explanation: 21:30–25:09
• Risks of Overspending vs. Underspending, and Living Well: 25:10–29:22
• Guardrails Strategy, Real-World Demo: 33:00–39:28
• Historical Simulations (Great Depression, Stagflation): 48:59–55:04
• Changing the Retirement Language: 45:08–46:26
• Wrap-Up & Resources: 58:37–60:22

Actionable Resources

• Aubrey’s free guardrails instructions & spreadsheet:
  openpath.financial/guardrails (58:40)
• Tools mentioned:
  FireCalc, Projection Lab (paid), Big Earn SWR Calculator

Closing Thoughts

With effective planning, flexible spending adjustments, and the right mindshift, retirees can leave the “scarcity” mindset behind. Aubrey’s approach offers clear tools, historical backing, and a way to confidently spend more while still safeguarding your financial future.

He is Scott Trench. I am Mindy Jensen. Peace, geese!