Masters in Business: At The Money – Planning Your Retirement

Host: Barry Ritholtz
Guest: Christine Benz, Director of Personal Finance and Retirement Planning at Morningstar
Release Date: July 2, 2025

1. Introduction

In this episode of At The Money, Bloomberg Radio host Barry Ritholtz delves into the intricacies of retirement planning with Christine Benz, a seasoned expert in personal finance and retirement strategies. The discussion aims to equip listeners with the knowledge and tools necessary to navigate the complexities of retirement, ensuring a fulfilling and financially secure future.

2. Defining Purpose in Retirement

Timestamp: [02:46]

Christine Benz emphasizes the critical role of defining one's purpose in retirement. She argues that retiring from a fulfilling career can leave a void, as many derive significant purpose from their work.

Christine Benz: "As you approach retirement, make sure that you're being super thoughtful about how you will replace that sense of purpose that you derived from your work."

Benz advises individuals to proactively identify activities that provide a sense of purpose, whether large-scale endeavors or simple daily joys. She references Jordan Grummet's concept of "small p purpose," which includes activities like bird watching, gardening, or cooking for family—highlighting that finding fulfillment doesn't necessarily require grand undertakings.

Christine Benz: "Find those things that bring you joy, that give you that animating force for your day."

3. The Importance of Early Planning

Timestamp: [04:32]

Barry Ritholtz critiques the traditional notion of retirement as a distant, fixed point, advocating instead for early and continuous planning.

Barry Ritholtz: "The idea of retirement has a hard stop where we're not really thinking about it except for the months leading up to retirement. It's a terrible model."

He recommends initiating retirement planning around age 50, encouraging individuals to gradually transition by assessing and adjusting their current work activities. This gradual approach helps in reducing the abruptness and stress often associated with retirement.

Barry Ritholtz: "Take an inventory of the things that you still enjoy. Taking an inventory of the things you don't enjoy as much."

4. Generating Retirement Income

Timestamp: [06:07]

Christine Benz discusses the various sources of retirement income, emphasizing the importance of diversifying beyond traditional portfolio income like dividends and bond yields. She warns against relying solely on these as it can lead to portfolio construction traps.

Christine Benz: "I think retirees love the idea of subsisting on organically generated income. I think that can be actually a huge trap from a portfolio construction standpoint."

Benz advocates for a dynamic approach to income generation, where retirees actively manage their portfolios to adjust to market fluctuations and personal financial needs annually.

Christine Benz: "It's a dynamic approach. It's not a one and done."

5. Social Security Strategies

Timestamp: [08:04]

The conversation shifts to Social Security, where Benz highlights the benefits of delaying claims to maximize monthly income.

Christine Benz: "Delaying is a really good strategy for people who can afford to do that... You get a guaranteed pickup in benefits for every year that you're able to delay past your full retirement age."

She suggests that high earners, particularly the primary earners in a household, can significantly benefit from postponing Social Security claims, thereby increasing the overall household income.

Christine Benz: "For a lot of couples, it's maybe kind of divide and conquer where one claims at full retirement age and the other waits until age 70."

6. Investment Portfolio Structuring

Timestamp: [09:51]

Barry Ritholtz introduces the "bucket approach" to retirement portfolio planning, which Christine Benz strongly supports. This method involves dividing investments into distinct "buckets" based on time horizons and risk levels.

Barry Ritholtz: "Having very liquid reserves, maybe amounting to a couple of years worth of portfolio withdrawals, then maybe fixed income assets accounting for another five to eight years worth of portfolio withdrawals, and then the rest in a globally diversified equity portfolio."

Benz elaborates that this strategy not only provides peace of mind during market downturns but also enhances long-term portfolio stability. She differentiates "cash" as pure, non-volatile assets like money market funds or high-yield savings accounts, ensuring they remain untouched during market fluctuations.

Christine Benz: "I think of it as kind of a zero risk portion of the portfolio."

7. Working Part-Time in Retirement

Timestamp: [12:56]

The discussion explores the benefits of continued employment, even in a part-time capacity, during retirement. Christine Benz cites data showing that ongoing work correlates with better health and financial stability.

Christine Benz: "People who are able to work later in life do tend to be healthier and wealthier."

She advises individuals to negotiate flexible work arrangements, such as reduced hours or specific days off, to ease the transition into retirement while maintaining a sense of purpose and social interaction.

Christine Benz: "Maybe you can transition where you're taking Wednesday off at first or working three days a week."

8. Conclusion

Timestamp: [15:40]

Barry Ritholtz wraps up the episode by reiterating the paramount importance of comprehensive retirement planning. He underscores the necessity of early preparation, dynamic financial strategies, and open communication with family members to ensure a smooth and satisfying retirement journey.

Barry Ritholtz: "Planning goes a long way. The sooner you start planning, the better."

Key Takeaways

• Purpose is Crucial: Define what gives your life meaning beyond work before retiring.
• Start Early: Begin retirement planning around age 50 to allow gradual adjustments.
• Diversify Income Sources: Rely on a mix of non-portfolio and portfolio income to avoid financial traps.
• Optimize Social Security: Consider delaying claims to maximize benefits, especially for high earners.
• Adopt a Bucket Approach: Structure your investment portfolio into segments based on timeframe and risk tolerance.
• Consider Part-Time Work: Continue working in a flexible capacity to maintain financial stability and personal fulfillment.

This episode provides a comprehensive guide to retirement planning, blending expert insights with practical strategies to help listeners navigate their post-career lives confidently and purposefully.