Almost Weekly Blog

The commonalities between planning a mountain expedition and planning one’s financial future seem endless: both find an efficient path to the goal, navigate with redundant (back-up) systems, use specific tools to mitigate large risks, minimize the “drag” of non-essential components, and advance while constantly reassessing changing conditions. Arranging an income stream to bridge a gap between the retirement date and the commencement of Social Security benefits, boosting income in mid-retirement to adjust for “felt” inflation, or late in life to help cover the higher costs of deteriorating health must be intelligently designed from a healthy list of options.

• The Systematic Withdrawal Strategy involves withdrawing a predetermined percentage (4% is the baseline) of the retirement portfolio annually, adjusted for inflation. The advantages are a structured approach, inflation protection, flexibility, and risk management. The disadvantages consist of market dependence, management complexity, risk of asset depletion, and the natural distaste of having to periodically sell assets to produce income.

• The Bucket Withdrawal Strategy involves funding several different buckets, each holding distinct securities designed to fund expenses for a specific retirement period. Advantages of The Bucket Strategy include simplicity, clear retiree visualization, structured asset/liability matching, and adjustability. Disadvantages include high maintenance implementation, higher transaction costs, tax implications, and market risk exposure.

• The Flooring Withdrawal Strategy distinguishes between fixed and discretionary retirement expenses, secures provision for the former with lifetime income sources while investing remaining assets more aggressively to cover discretionary expenses. Advantages to The Flooring Strategy include effective management of longevity risk and excess withdrawal risk, income smoothing, suitability for low risk tolerance retirees, and may help reduce certain financial vulnerabilities later in life. Disadvantages include loss of liquidity, loss of capital with an early death, loss of investment control, pricing concerns, and irrevocability.

Studious future retirees begin by thoroughly investigating their claiming options for Social Security, a lifetime inflation-protected income source with favorable tax treatment. It’s notable that retirees who complement Social Security by funding additional fixed expenses with streams of passive income are reported in numerous studies to a) be more financially confident, b) be more content, and c) spend twice as much money as those who periodically sell assets to create income via a systematic withdrawal program.¹ Customized bridge or lifetime income streams can be funded by an annuity or bond ladder.

Add a disciplined annual tax plan to your flavor of income strategies, whether it be the Bucket, Flooring, or Systematic Withdrawal approach, as you seek to improve lifetime after-tax income. May God bless the legacy you leave to others in both example and in wealth, Shaun.

“Commit your work to the Lord, and your plans will be established.”

~Proverbs 16:3

1 The American College of Financial Services, Retirement Income Certified Professional course, 2025

Disclosure(s):

Old Forge Wealth Management, LLC is a registered investment adviser. This material is provided for informational and educational purposes only and should not be construed as individualized investment, tax, or legal advice. The strategies discussed may not be appropriate for every investor. Investment decisions should be based on an individual’s specific financial circumstances, objectives, risk tolerance, and needs.

Old Forge Wealth Management, LLC does not provide tax or legal advice. Tax considerations vary based on individual circumstances, and clients should consult with their tax and/or legal professionals regarding their specific situation.

Annuities are insurance products and may involve fees, expenses, surrender charges, liquidity restrictions, and other limitations. Guarantees associated with an annuity are subject to the financial strength and claims-paying ability of the issuing insurance company. Annuities may not be appropriate for all investors.

Misinformation pertaining to the Social Security Program and its future abounds today, leading many recipients to make poor claiming decisions which may result in a more challenging Retirement Income Plan, higher retirement income taxation, and a smaller legacy left to heirs. For many Americans, Social Security is one of the most valuable assets they will ever own, yet many people make decisions to claim benefits early based on assumptions that may not hold up when the numbers are analyzed. Here are three common—and often misleading—reasons people give for claiming Social Security too soon.

1. “I’ve paid into it for years, so I might as well take it now.”

That sounds reasonable, but Social Security isn’t simply a savings account that you are trying to get your money back from. The timing of your claim can have a major impact on the size of your future monthly benefit. You can begin retirement benefits as early as 62, but claiming before Full Retirement Age permanently reduces the monthly benefit. Conversely, delaying beyond Full Retirement Age can earn Delayed Retirement Credits until age 70. For people born in 1960 or later, for example, claiming at 70 produces a benefit equal to 124% of the Full Retirement Age benefit.

2. “Social Security might run out, so I need to get mine before it does.”

Social Security does face a financing challenge, but “running out” is an oversimplification. According to the 2026 Trustees Report, the OASI Trust Fund is projected to be depleted in the fourth quarter of 2032 under current law. At that point, ongoing program income is projected to cover 78% of scheduled benefits. Congress has numerous potential policy options available, including changes to retirement ages, payroll taxes, taxable earnings, benefits, taxation of benefits, and other program provisions. The Social Security Administration itself publishes analyses of these options. In other words, today’s uncertainty does not automatically mean you should make a permanent claiming decision based on fear.

3. “Taking Social Security early gives me more money and preserves my investments.”

This is where retirement planning becomes much more complicated. The question isn’t simply, “When can I start Social Security?” It is, “What combination of Social Security, retirement accounts, taxes, investments, longevity, and legacy goals produces the most appropriate overall strategy for my situation?” Delaying Social Security may provide a larger future income stream, but using other assets to bridge the gap can have tax and investment consequences. In some situations, the decision can also affect a surviving spouse and the amount of assets ultimately passed to heirs.

That’s why a proper Roadmap analysis can be so important. Instead of making the Social Security decision in isolation, a Roadmap analysis can model different claiming ages alongside retirement income, withdrawals, taxation, longevity, investment assets, and legacy objectives. The goal isn’t simply to maximize a Social Security check—it is to coordinate the pieces of the retirement plan so that one decision doesn’t unintentionally undermine another. Social Security provides choices. The challenge is understanding how those choices interact with the rest of your financial life. Before you claim, run the Roadmap.¹

I’m excited to share that I have officially earned the Registered Social Security Analyst® (RSSA®) credential. This specialized certification allows me to help individuals, families, and businesses seek to optimize their Social Security benefits and make informed financial decisions for retirement. As an RSSA®, I’m here to assist people in understanding the benefits they may be entitled to receive and help them evaluate their Social Security options. If you have any questions about your Social Security benefits or know someone who could benefit from a personalized Social Security plan, I’d love to help!

Click here to learn more, and may God bless your Social Security claiming decision! Shaun

“Choosing when to trigger Social Security benefits can be one of the most financially impactful decisions the vast majority of Americans will make pertaining to their Retirement Income Plan”. ~Shaun Scott

“In the multitude of counselors there is safety” ~Proverbs 11:14

1 National Association of Registered Social Security Analysts, RSSA Program, 2026

Disclosures:

Old Forge Wealth Management, LLC is a registered investment adviser. Registration as an investment adviser does not imply a certain level of skill or training.

This material is provided for informational and educational purposes only and should not be construed as individualized investment, tax, legal, or Social Security advice. Social Security claiming strategies and their potential effects vary based on individual circumstances, and there is no assurance that any particular strategy will achieve a specific financial outcome.

Social Security laws, regulations, benefit calculations, and tax laws are subject to change. Information and projections regarding the Social Security program are based on information available as of the date of publication and may change as a result of future economic, demographic, or legislative developments.

Any Roadmap analysis is based on information provided and assumptions made at the time of the analysis. Results are illustrative and are not guarantees of future results.

The Registered Social Security Analyst® (RSSA®) designation is offered by the National Association of Registered Social Security Analysts (NARSSA). Old Forge Wealth Management, LLC and its representatives are not affiliated with or endorsed by the Social Security Administration or any other government agency.

I remember realizing shortly after we moved into our North Kingstown home that Tarzan himself once lived here. While lighting one of the enormous bonfires of those early days a combination of dense air, too much gasoline poured onto the pile too soon, and the spark itself resulted in 1,000 times the explosion required to light my fire. The U.S. economy may be approaching a highly combustible combination of its own: an energy supply shock caused by the closing of the Strait of Hormuz, noticeably depleted Strategic Oil Reserves that must eventually be replenished, and an attempt by policymakers to suppress long-term interest rates.

The Strait of Hormuz remains severely disrupted following the ongoing conflict with Iran, with traffic reportedly down about 95% from normal levels. The waterway is a critical conduit for global energy supplies, and even a partial, prolonged disruption can raise the cost of crude oil, refined products, shipping, and insurance. The first-round effect is straightforward: higher energy prices feed directly into gasoline, diesel, transportation and utility costs. The second-round effect is more important. Businesses facing higher energy, freight and input costs eventually pass those expenses through to consumers, potentially broadening an initially energy-driven inflation shock.

The Hormuz-related reduction in oil shipments has led to additional drawdowns from the U.S. Strategic Petroleum Reserve, which remains well under half of its total capacity and at historically low inventory levels.¹ Replenishing that lost inventory could eventually require the government to become a significant buyer of crude oil, potentially at prices well above today’s. This creates an additional source of demand in the oil market, putting upward pressure on crude and gasoline prices. Because energy costs are embedded throughout the economy, higher oil prices can feed into a broad range of goods and services, making the eventual replenishment of the Strategic Petroleum Reserve potentially inflationary.

These inflationary headwinds introduce the risk of a lower real (after inflation) return on long-dated US Treasury bonds. As a result, buyers of long bonds have been demanding higher interest payments to substantiate increased risk-taking, driving yields to the highest level since 2007.² This surge in yields acts as a warning signal to investors of higher inflation, but is not politically expedient approaching a Mid-term Election, and the Treasury Department has responded in what may be an attempt to suppress long-term bond yields by increasing purchases of longer-maturity government debt. Financial repression can artificially lower interest rates in the short term but undermines long-term economic stability by limiting monetary policy tools and potentially fueling future inflation. Historical parallels drawn to the 1960s and 1970s suggest that such measures could backfire.

Energy shocks do not necessarily appear fully in headline inflation immediately. They can work through supply chains over several months. That means today’s disruption could become tomorrow’s broader inflation problem—even if oil prices stabilize before the headline numbers peak. This is therefore less a forecast than a warning: Hormuz creates the inflation impulse; long-rate suppression could amplify the financial response. If both forces persist, the months ahead could look considerably more inflationary than current consensus expectations suggest.

Think about it, and may God bless your effort to mitigate investment risk while earning net-positive (after taxes and inflation) returns. Shaun

“Inflation is not an unexplainable phenomenon; it is our national policy. I define it as a deceptive way to hide excessive debt.” ~Shaun Scott

“He who earns wages does so to put them into a bag with holes”. ~Haggai 1:6

1 Stansberry Research, The Stansberry Digest, “Them’s Fightin’ Words”, August 25, 2026

2 Trading Economics, United States 30 Year Bond Yield, August 28, 2026

Disclosure(s): The information contained herein is provided for informational and educational purposes only and should not be construed as individualized investment, tax, or legal advice or as a recommendation to buy or sell any security or investment. The views and opinions expressed are based on information believed to be reliable as of the date of publication and are subject to change without notice. Third-party information and data are believed to be reliable; however, their accuracy or completeness cannot be guaranteed.

Statements regarding future economic, market, geopolitical, or policy conditions are forward-looking in nature and involve risks and uncertainties. Actual events and results may differ materially from those discussed. Past market or economic conditions are not indicative of future results.

Investing involves risk, including the possible loss of principal. Fixed-income investments are subject to risks including interest-rate, inflation, credit, and market risk, and bond values generally decline as interest rates rise. Investors should consider their individual circumstances, investment objectives, risk tolerance, and tax situation before making investment decisions.

Old Forge Wealth Management, LLC is a registered investment adviser. Registration does not imply a certain level of skill or training.

For many retirees, a Required Minimum Distribution, or RMD, sounds harmless. After all, it is simply money being moved from an IRA or retirement account into the retiree’s checking account. But there are less obvious cost that many retirees discover only after they are already in retirement: an RMD can create a chain reaction of additional taxes and higher Medicare premiums.

Starting generally at age 73 (75 for those born in 1960 or later), retirees must begin taking RMDs from traditional IRAs and many employer-sponsored retirement plans. Those distributions are generally taxable as ordinary income.

The problem is that an RMD doesn’t exist in isolation.

One Dollar of RMD Income Can Create Several Dollars of Cost

The IRS uses a formula that considers one-half of Social Security benefits plus other income to determine whether Social Security is taxable. Depending on filing status and income, up to 85% of Social Security benefits can ultimately be included in taxable income. This creates an important phenomenon: taking additional money from an IRA can cause more of your Social Security benefit to become taxable. So the retiree may experience a double effect. The RMD itself is taxable, and the RMD may cause additional Social Security benefits to become taxable.

RMDs Can Also Trigger IRMAA Surcharges

Medicare has an income-based premium system known as IRMAA—the Income-Related Monthly Adjustment Amount. Medicare uses a retiree’s modified adjusted gross income to determine whether higher Part B and Part D premiums apply.

For 2026, for example, a married couple filing jointly with modified adjusted gross income of $218,000 or less pays the standard Part B premium. Once income crosses that threshold, the couple moves into a higher premium tier. The 2026 Part B total monthly premium rises from $202.90 at the standard level to $284.10, $405.80, $527.50, $649.20 and ultimately $689.90 as income moves through the higher brackets. Part D also carries additional IRMAA charges at higher income levels.

That means an RMD can potentially have consequences far beyond the income tax return.

A retiree who needs only $30,000 from an IRA may nevertheless be required to withdraw $60,000. If that additional income pushes the household across an IRMAA threshold, the retiree can end up paying substantially more for Medicare. And here’s the frustrating part: the retiree may not even need the money.

The Retirement Planning Paradox

This is where RMDs can become fiscally consequential.

During their working years, many people diligently contributed to traditional IRAs and 401(k)s because the contributions were tax-advantaged. The money grew tax-deferred for decades. But tax deferral isn’t tax elimination; eventually the IRS requires the money to come out. If the account has grown substantially, the RMD may be much larger than the retiree’s actual spending needs.

The result can be a retirement income paradox: the more successfully someone saved in tax-deferred accounts, the greater the potential for future taxable income.

That income can affect three different areas simultaneously:

1. Federal income taxes on the RMD.
2. The taxability of Social Security benefits.
3. Medicare Part B and Part D premiums through IRMAA.

In other words, the real cost of an RMD isn’t necessarily the tax rate applied to the distribution. The real cost is the marginal impact of the distribution on the entire retirement tax picture.

Planning Before the RMD Years

This is why retirement income planning should begin well before age 73.

For some retirees, strategically taking withdrawals from traditional retirement accounts before RMDs begin can reduce future account balances and therefore future RMDs. Others may consider Roth conversions (taxable) during lower-income years, since qualified Roth IRA distributions generally aren’t included in the owner’s taxable income and Roth IRAs don’t require lifetime RMDs for the original owner.

The objective isn’t simply to pay the least tax this year.

The objective is to manage the retiree’s lifetime tax burden.

A thoughtful retirement strategy looks at today’s tax bracket, future RMDs, Social Security taxation, Medicare premiums, and the potential tax consequences for surviving spouses and heirs.

The key lesson is simple: RMDs are not just a withdrawal requirement—they are a retirement income planning issue. Waiting until age 73 to address them may mean discovering that a lifetime of tax-deferred savings has created tax consequences that might have been reduced or better managed through earlier planning.

Think about it, start your retirement income planning early, and God bless your efforts! Shaun

“Asset ‘location’ is as important to retirement income planning as asset allocation is to investing.” ~Shaun Scott 

“The prudent sees danger and hides himself, but the simple go on and suffer for it.” ~Proverbs 22:3

Disclosure(s): This material is provided for general informational and educational purposes only and should not be construed as individualized investment, tax, legal, or accounting advice. Information regarding Required Minimum Distributions (RMDs), Roth conversions, Social Security taxation, and Medicare premiums, including Income-Related Monthly Adjustment Amounts (IRMAA), is based on current laws, regulations, and published thresholds, which are subject to change.

Tax and retirement planning strategies involve numerous considerations and may not be appropriate for everyone. Roth conversions and retirement account withdrawals generally have tax consequences, and their impact will vary based on an individual’s specific circumstances. Individuals should consult with their tax professional, attorney, and financial advisor regarding their specific situation before implementing any strategy discussed herein.

Any examples provided are hypothetical and for illustrative purposes only and are not intended to represent the circumstances of any specific individual. There is no guarantee that any particular planning strategy will reduce taxes, Medicare premiums, or otherwise achieve a particular outcome.

Old Forge Wealth Management, LLC is a registered investment adviser. Registration as an investment adviser does not imply a certain level of skill or training.

As the Old Forge Wealth Management team pursues the credentials, knowledge, and software program required to help our valued clients investigate their claiming options, weigh the implications of each in the context of a personal Retirement Income Plan, and identify the optimal claiming strategy, please consider the following insights into the Social Security program and the financially impactful decision attached to it:

· It’s often considered a six-figure retirement decision. The difference between a well-optimized claiming strategy and a less effective one can, depending on individual circumstances, add up to tens or even hundreds of thousands of dollars over a couple’s lifetime.

· Married couples have far more claiming options than single individuals. Decisions about when each spouse claims affect not only their own benefits but also spousal and survivor benefits, making optimization significantly more valuable.

· The highest monthly benefit isn’t always the highest lifetime benefit. A larger monthly check may require waiting longer, but if life expectancy is shorter than expected, claiming earlier could result in greater total lifetime income.

· The earliest claiming option often permanently reduces benefits. Claiming before full retirement age locks in a lower monthly benefit for life, and that reduction can also affect survivor benefits.

· Longevity is uncertain. Since no one knows how long they or their spouse will live, the optimal strategy balances the risks of living much longer—or much shorter—than average.

· Survivor benefits can make delayed claiming especially valuable for the higher-earning spouse. The surviving spouse may inherit the larger benefit, meaning one claiming decision can provide higher income for decades after the first spouse dies.

· Optimizing for the household matters more than optimizing for each individual. The best strategy is often the one that maximizes total lifetime benefits for both spouses together, rather than maximizing either spouse’s monthly check.

· Social Security is one of the few sources of guaranteed lifetime, inflation-adjusted income. Maximizing this income can reduce the need to rely on investment withdrawals later in retirement.

· Inflation protection compounds over time. Since Social Security benefits generally receive annual cost-of-living adjustments, a larger base benefit can provide substantially more purchasing power over a long retirement.

· Claiming decisions are difficult or impossible to reverse. Unlike many investment decisions, Social Security claiming choices are generally permanent, making it especially important to get them right before filing.

· Taxes can change the value of different claiming strategies. Coordinating benefit timing with withdrawals from retirement accounts and other income sources can improve after-tax retirement income.

· Claiming decisions affect withdrawal strategies. The age at which benefits begin influences how much must be withdrawn from savings, potentially affecting portfolio longevity.

· One spouse’s claiming age can influence the couple’s overall financial security. Even if one spouse receives a relatively small benefit, coordinating both claiming dates can produce a substantially better overall outcome.

· Health differences between spouses matter. When one spouse is expected to live significantly longer than the other, the optimal claiming strategy often changes to maximize lifetime household income.

· Employment before full retirement age can reduce benefits temporarily. For those still working, claiming early may result in benefits being withheld under the earnings test, making timing more important.

· Social Security interacts with the rest of the retirement plan. Pension income, required minimum distributions, investment assets, and retirement spending goals all influence the best claiming decision.

· A strategy based solely on “break-even age” can be misleading. Good claiming decisions consider multiple uncertainties—including longevity, survivor needs, taxes, investment returns, and spending—not just a single age comparison.

· The optimal strategy is highly personal. Two couples with identical earnings histories but different health, ages, assets, or retirement goals may have completely different optimal claiming decisions.

· Mistakes can affect both spouses for decades. Because benefits may continue for the lifetime of the surviving spouse, the financial consequences of a suboptimal decision can extend well beyond the first spouse’s lifetime.

· A personalized analysis can help identify considerations that general rules of thumb may not address. Rules like “claim at 62” or “wait until 70” may be appropriate in some situations, but personalized analysis often identifies a strategy that better balances lifetime income, risk, and financial security for the couple.

Understand the importance of the Social Security Claiming decision to your retirement success, be convinced it is worthy of your investigative time, and feel free to reach out for professional guidance. Thank you for the privilege of serving you, Shaun.

“In the abundance of counselors there is safety” ~Proverbs 11:14

Disclosure(s): Old Forge Wealth Management, LLC is a registered investment adviser. Registration does not imply a certain level of skill or training. This material is provided for informational and educational purposes only and should not be construed as investment, legal, tax, or Social Security advice. Social Security claiming decisions should be based on an individual’s or couple’s unique circumstances, objectives, and financial situation. Individuals should consult with their tax professional, attorney, the Social Security Administration, and other qualified professionals, as appropriate, before making any claiming or financial decisions. Any examples or illustrations are for educational purposes only, are based on assumptions, and are not intended to predict or guarantee future results. Actual outcomes will vary based on individual circumstances and applicable laws and regulations, which are subject to change.

In the documentary, Meru, co-director and climber Jimmy Chin half-joked about eating his boots after he, Conrad Ankor, and Renan Ozturk ran out of food during their harrowing 2008 attempt at a ‘first ascent’ of the Shark Fin. The team carried an insufficient food supply to complete the endeavor due to a duration misjudgment. A 2021 Capital Group blogpost revealed Americans on average were underestimating lifespan by five years, and the numbers were trending down. Since Longevity Risk, or the risk you’ll live longer than you expect and have trouble funding those extra years with deflated income dollars, is one of the Seven Derailing Retirement Income Plan Risks, let’s consider how the optimal Social Security election can help to mitigate it.¹

• Provides guaranteed lifetime income: Social Security benefits continue for life, ensuring income does not run out regardless of how long the retiree lives.
• Helps Protects against longevity risk: Delaying benefits (when appropriate) increases the guaranteed monthly payment, providing greater financial security in advanced age when personal savings may be depleted.
• Creates a higher “floor” of retirement income: Larger Social Security benefits reduce reliance on investment withdrawals during later retirement years, helping preserve portfolio assets.
• Provides inflation protection: Benefits receive annual cost-of-living adjustments (COLAs), helping purchasing power keep pace with inflation over a potentially long retirement.
• Enhances survivor protection: Optimizing claiming strategies can maximize survivor benefits, providing the surviving spouse with a larger lifetime income stream.
• Improves retirement spending confidence: Knowing a larger portion of essential expenses is covered by guaranteed lifetime income allows retirees to spend with greater confidence without fear of outliving their assets.
• Offers an attractive “return” for healthy retirees: Individuals with longer life expectancies often receive substantially more lifetime benefits by delaying claiming, making optimization especially valuable.
• Reduces dependence on long-term care of family or government assistance: Higher lifetime guaranteed income can help cover increasing expenses later in life, reducing financial strain if longevity exceeds expectations.
• Functions like longevity insurance: An optimal Social Security claiming decision effectively transfers part of the financial risk of living much longer than expected from the retiree to the Social Security system.

Social Security income is the foundation of the Flooring Strategy, which seeks to match lifetime income sources to fixed expenses, and income dependent on market forces to discretionary expenses. It’s an approach which may lower the probability we’ll have to consider eating our boots. Think about it, and may God bless your retirement income planning efforts! Shaun

“My son, do not forget my teaching, but let your heart keep my commandments, for length of days and years of life and peace they will add to you” ~Proverbs 3:1-2

1 Insurance Newsnet, Advisor News, “Your Clients Are Likely Underestimating Their Lifespan By 5 Years”, July 19, 2021

https://insurancenewsnet.com/innarticle/your-clients-are-likely-underestimating-their-lifespan-by-5-years

Disclosure(s): Old Forge Wealth Management, LLC is a state-registered investment adviser. Registration does not imply a certain level of skill or training. The information contained in this article is provided for informational and educational purposes only and should not be construed as investment, tax, legal, or accounting advice, or as a recommendation that any particular Social Security claiming strategy or retirement planning strategy is appropriate for every individual. Social Security claiming decisions should be based on an individual’s unique financial circumstances, objectives, health, and retirement goals. Please consult your financial, tax, and legal professionals before making financial decisions. Past performance is not indicative of future results, and all investments involve risk, including the possible loss of principal.

The wealthier a family is, the more it will benefit from a lower tax rate. It’s also true that every family paying taxes will benefit from paying less of them. Another way of saying it is, the less a family pays in taxes, the more financially liberated that family will be. Since legal maneuvering aimed at minimizing lifetime taxes can produce meaningful long-term savings, let’s differentiate between tax preparation, tax planning, and tax management in hopes we may benefit from each.

Tax preparation involves gathering financial information, calculating tax liabilities, and filing required tax returns accurately with government authorities while avoiding penalties and errors. It is a retrospective process aimed at settling a past tax bill with the IRS, and though it costs money, it’s primary purpose is compliance rather than tax reduction.

Tax planning is the strategic process of arranging financial activities to maximize lifetime after-tax income and minimize taxes on the distribution of the remaining estate to heirs. Notice this does not resemble the rote minimization of taxes every year, but does include building a retirement income plan, positioning assets tax-efficiently, identifying tax-efficient withdrawal strategies, and creating a program for future tax outcomes. It is forward-looking, strategic, and when done well, can result in significant tax savings when implemented properly.

Tax management is the ongoing process of implementing and monitoring the tax plan while adjusting for personal financial developments and changes in tax policies and regulations. It is action-oriented and includes routine “what-if” analyses, year-round management of tax opportunities, and the integration of tax, investment, insurance, retirement income planning and estate planning decisions into one coordinated process.

While tax preparation and proper filing are required, they generally offer fewer tax-saving opportunities than proactive tax planning. Building a tax plan is a worthy endeavor, but absent implementation, it doesn’t reduce taxes. Consider whether the careful ongoing management of well-laid tax plans might benefit you and your family, and may God bless your planning efforts! Shaun

“Render to Caesar the things that are Caesar’s, and to God the things that are God’s” ~Matthew 22:21

“Never waste a low tax bracket with short-term thinking!” ~Ed Slott

“Your IRA is an IOU to the IRS” ~Ed Slott

“Tax preparation costs you money; tax planning makes you money” ~Ed Slott

Disclosure(s)

This material is provided for informational and educational purposes only and is not intended to provide tax, legal, accounting, or investment advice. The information presented is general in nature and may not apply to your specific circumstances. Tax laws, regulations, and interpretations are subject to change, and their application may vary depending on individual facts and circumstances. You should consult with your qualified tax, legal, and financial professionals before implementing any tax planning strategy or making financial decisions.

Tax planning strategies are not guaranteed to reduce taxes or produce specific financial outcomes. Any references to potential tax benefits or strategies are for illustrative purposes only and do not represent a promise or prediction of results. Individual outcomes will vary based on personal circumstances, changes in tax laws, and other factors.

Old Forge Wealth Management, LLC is a registered investment adviser. Registration does not imply a certain level of skill or training.

While it is a uniquely enjoyable privilege to dally on a high mountain summit, every experienced climber knows the vast majority of mountaineering casualties occur on the descent and understands the need for precision. I suspect this lingering truth results in an unjustly short average summit stay, given the ascent’s required suffering. A similar anomaly plays out in the form of retiree underspending, in particular with those who create income by selling assets, as with a standard systematic withdrawal plan, as opposed to those who receive streams of lifetime income, as with regular payments from a pension or annuity.

Savers invest a portion of their income today, which reduces the present lifestyle, to pre-fund a desirable lifestyle after retirement, generally into a Defined Contribution Plan, such as a 401(k), SIMPLE, or 457(b) Plan. In an inflationary culture, however, and for retirees lacking a second lifetime income stream (to Social Security), a spend-down in savings is often required to maintain the habituated lifestyle in retirement, and here enters the paradox; for various reasons, retirees are generally uncomfortable watching their nest egg shrink, even to fund pre-planned retirement lifestyle goals, and so they underspend. One research project concluded that retirees with guaranteed income sources spend twice the amount of money as those with an equal amount of investment wealth!¹

While strong legacy goals may justify a degree of underspending, “The Flooring Approach” may help some retirees feel more comfortable spending in retirement and may support retirement lifestyle goals.:

• To determine the percentages of your God-given wealth to be allocated towards giving, investing, and producing lifetime income, start by differentiating between fixed and discretionary retirement expenses.
• Consider whether reliable lifetime income sources may help cover a substantial portion of essential retirement expenses. Start by considering a delay in Social Security benefits to age 70, which will maximize monthly benefits, may provide additional inflation protection over time, and may help support income needs for a surviving spouse with the smaller benefit amount.
• If net Social Security benefits, coupled with other lifetime income sources, like a pension or annuity, don’t cover fixed expenses, consider your ability to buy a lifetime income annuity to make up the difference.

While the advantages of “The Flooring Approach” are notable, most lifetime income annuities don’t include a cost-of-living adjustment, which increases the importance of a delay in Social Security benefits to fight inflation long-term. Consideration should also be given to the type of dollars (Pre-tax, Taxable, or Tax-free) used to fund such an annuity, consistent to your personal tax plan.

It is a mystery to retirement economists that so few retirees spend a portion of their wealth to purchase a lifetime income, referred to as “the annuity puzzle”, especially since it is economically efficient to transfer longevity risk to an insurance company.² Don’t enjoy the well-earned summit too briefly, and don’t be an underspending retiree for lack of due diligence on the subject! May God bless your retirement income planning efforts, Shaun.

“Plans fail for lack of counsel, but with many advisers they succeed”

~Proverbs 15:22

“Commit to the Lord whatever you do, and He will establish your plans.

~Proverbs 16:3

1,2 Ed Slott’s IRA Advisor, April, 2026, “Giving Yourself a License to Spend in Retirement”, by Michael Finke, Ph.D.

Disclosure

Old Forge Wealth Management, LLC is a registered investment adviser. Registration does not imply a certain level of skill or training. This material is provided for informational and educational purposes only and should not be construed as individualized investment, tax, legal, or insurance advice or as a recommendation to buy or sell any security or insurance product. The views and opinions expressed are those of the author as of the date of publication and are subject to change without notice.

All investments and retirement income strategies involve risk, including the possible loss of principal. Strategies discussed, including annuities, systematic withdrawals, and Social Security claiming decisions, may not be suitable for all individuals and should be evaluated based on an investor’s unique financial situation, objectives, risk tolerance, liquidity needs, and tax circumstances. Guarantees associated with annuity products are subject to the claims-paying ability and financial strength of the issuing insurance company. Individuals should consult with qualified financial, tax, and legal professionals before implementing any retirement income strategy.

Past performance and historical research are not indicative of future results.