Category: podcast

David McKnight unpacks the five most common objections to Roth conversions and why they simply don’t hold up under scrutiny. The first objection has to do with people not wanting to voluntarily pay taxes before the IRS requires them to. While on the surface, postponing this may sound logical, it ignores a fundamental aspect: the state of the U.S. national debt. It has just passed $39 trillion, and it’s slated to grow by $2 trillion per year for the next 10 years, and $3 trillion after that. In other words, interest on the national debt is becoming one of

David McKnight dissects a topic that causes a lot of confusion for retirees and pre-retirees: How Roth conversions affect social security taxation and Medicare premiums (IRMAA). Some warn against Roth conversions in retirement as they can cause your Social Security to become taxable and could also raise your Medicare premiums. While that’s true, David believes that the long-term benefits of Roth conversions can far outweigh the temporary, short-term pain they can cause. In order to determine whether your Social Security benefits will be taxed, the IRS tracks the so-called provisional income. If you perform a Roth conversion after you

David McKnight addresses one of the biggest threats to your retirement plan: sequence of returns risk. Are you retired or within 10 years of retirement? Sequence of returns risk may be the single most important concept you need to understand if you want to ensure your money lasts as long as you do. Sequence of returns risk refers to the danger of experiencing a market downturn early in retirement while you’re simultaneously taking withdrawals from your portfolio. David explains why this risk is most dangerous during your first 10 years of retirement. Early in retirement, your money still needs […]

David McKnight breaks down the approach he would follow if he were to invest a $2 million 401(k) in retirement. David points out that when you retire, you’re no longer just investing for growth; you’re investing for income. Remember: If you get this wrong, you don’t get a do-over. In the case David discusses, many financial advisors would recommend investing the $2 million in the market and withdrawing whatever your lifestyle requires. The problem with that way of doing things, however, is the exposure to the sequence of returns risk. If the market crashes early in retirement and you’re

David McKnight explores the so-called “22% Roth conversion mistake,” which he considers a common and costly mistake when it comes to Roth conversions. He points out that, despite Trump tax cuts being made permanent with the passage of the One Big Beautiful Bill Act in July 2025, tax rates can change at any time with a simple act of Congress. That’s why he refers to this as a “temporary permanent tax cut.” The $200 trillion underfunding of entitlement programs and the exploding interest on the national debt makes it clear that tax rates are unlikely to stay this low

David McKnight discusses the three biggest retirement planning mistakes that show up over and over again. Avoiding them will dramatically increase the likelihood that your retirement savings will last as long as you do. Mistake #1 pertains to over-accumulating in tax-deferred accounts like 401(k)s and IRAs – a mistake that surprises many people as they feel they’re doing everything right. The problem here is that you’re taking a deduction at historically low tax rates only to postpone the payment of those taxes to a point in the future where tax rates are likely to be much higher than they

David McKnight explores a retirement planning phenomenon that almost nobody discusses, but that has been documented repeatedly in academic research. It’s the idea that when retirees convert some of their savings into guaranteed lifetime income through an annuity, they actually spend more money and enjoy retirement more than those who rely on their liquid retirement savings alone. Even though many people assume that doing so would make retirees more conservative with their spending, research actually shows the opposite. According to academic studies, when retirees have reliable lifetime income, they actually feel more comfortable spending money. Moreover, when retirees rely […]

David McKnight touches upon what he considers the most overlooked tax-free income stream. What he’s referring to is to leave enough money in your traditional IRA so that your required minimum distributions can be completely offset by your standard deduction in retirement. David believes that focusing on tax-free retirement strategies is more crucial than ever, since it’s becoming increasingly clear that taxes are likely to rise dramatically in the future. The United States is $39 trillion in debt and, as interest on that debt continues to grow and compound, the Government will eventually have to find ways to service […]

David McKnight addresses an issue he sees more and more in his conversations with retirees and pre-retirees: the so-called Roth over-conversion trap. The problem stems from converting too much money with the result of shortening the lifespan of your retirement savings. David believes that the reason why many Americans are racing to convert everything they have in their IRAs and 401(k)s has to do with the fear about where the country is headed financially. Penn Wharton has warned repeatedly that, if we don’t right our fiscal ship by 2043, no combination of raising taxes or reducing spending will arrest […]

In this episode of the Power of Zero Show David McKnight gives you a blueprint with the key steps to follow for a successful and stress-free retirement if you’re about five years away. The first step is figuring out your retirement income shortfall, the income you’ll need every month in retirement, as well as how much of that will be covered by sources like Social Security and pensions. The retirement income shortfall represents the amount of income your retirement assets need to produce in order to fund your lifestyle. One strategy many retirees rely on is taking a portion […]